Mumbai: Cinema operator Reliance MediaWorks expects to turn to profit from April this year as two of its projects get off ground and on better box-office collections, a senior official said on Thursday.
The firm posted a net loss in FY09 on heavy investments in the year and the first two quarters of FY10 were also in the red.
“Starting from the middle of the calendar year, we would see lot of positive cash flows,” chief executive officer Anil Arjun told Reuters in a telephonic interview.
Two projects - a film studio and a media BPO - will be commissioned this year, helping cut interest and depreciation costs, he said.
Arjun is also upbeat about box office collections such as James Cameron’s whopper hit 3-D sci-fi Avatar, another Hollywood movie that raked in the moolah, 2012, and Bollywood’s Aamir Khan-starrer 3 Idiots after a lacklustre 2009.
The firm, which runs 507 screens across the world, will add 80 more screens in India and 20 in the US this year.
Arjun is “quite bullish” on the film and media space, which has expanded in the last six months, and is already scouting for acquisition opporunities in Europe and the US.
“Wherever there are clients, we will look at a possibility. We are looking at Europe a lot more closely, and the US will also be on our radar.”
Earlier in the day, the theatre operator said it had acquired assets of London-based Ilabs and has already won two projects for image processing and restoration from UK-based broadcasters.
The firm plans to raise up to Rs6 billion via a rights issue of shares and will seek an approval from market regulator, Securities & Exchange Board of India (Sebi) in January.
“We are in the midst of preparing the draft letter offer. We are filing it to Sebi soon. That is under discussion,” he said.
The funds will be used to expand its cinema network, set up studios and media BPOs and to partly retire debt, he added.
Reliance Media plans to cut debt to below total equity value in the Jan-March quarter from the current ratio of 2:1.
Shares in the firm ended flat at Rs279.95 in a weak Mumbai market, which ended down 0.5%.