Mr. Sunil Lulla

Message from Executive Vice Chairman & Managing Director

“Overall, FY2017 will see an exciting movie collection for Eros of over 65 films driven by compelling stories in Hindi and other regional languages, making it the biggest future slate by any studio in India.”

Dear Shareholders,

As I write to you, Eros International is emerging stronger across India’s vast and growing entertainment landscape, building on its time-tested leadership.

Our idea of leadership is all-encompassing. It is evident not only in the way we manage our company, but also the role we play as a catalyst for change in our industry. We achieve this through a keen analysis of developments in the media markets around the world and incorporating global best practices in all we do, to build a better, stronger Eros.

For over three decades, Eros has been a pioneer in setting the global stage for Indian language cinema. Equipped with a strong balance sheet, scale, a large content library and a well-developed distribution network, Eros will continue to capitalise on new opportunities. Our operations involving the distribution of new films across theatrical, television and digital channels, along with monetisation of our extensive film library provides us with diversified revenue streams and a de-risked business model.

Our marketing and distribution capabilities allow us to reach audiences across India and over 50 countries in the original, dubbed or sub-titled form. Together with our strength in content, this enables Eros to sustain its strong leadership in India’s filmed entertainment industry.

The industry has witnessed significant growth on the back of diversified content ideas, wider releases and aggressive promotions by production houses. Factors such as rapid urbanisation, penetration of multiplexes in Tier II and III cities, increasing sophistication in production and marketing of films and viewers’ appetite to embrace varied content are all expected to be a catalyst for future growth. Additionally, the regional film industry is rapidly developing and offers a huge potential for growth. As a result, film revenues are expected to grow at CAGR of 10.6% over the period CY2015-20.

I am happy to report yet another strong set of financial results for FY2016. We ended the year with record revenues of Rs 1,603.55 crores and healthy profitability. The most encouraging highlight was that we generated free cash flows of Rs 300 crores in FY2016 and strengthened our balance sheet by bringing about working capital efficiencies.

I am happy to report yet another strong set of financial results for FY2016. We ended the year with record revenues of Rs 1,603.55 crores and healthy profitability. The most encouraging highlight was that we generated free cash flows of Rs 300 crores in FY2016 and strengthened our balance sheet by bringing about working capital efficiencies. Our results reflect the strong performance of our film slate with complete domination of the box office charts with runaway hits such as Bajrangi Bhaijaan, Bajirao Mastani, Tanu Weds Manu Returns, Welcome Back and others. The box office performance was complemented by strong television, ancillary and overseas revenues. The quality and performance of our films is further validated by the 150+ awards that we have won in 2015, earning Eros the honour of ‘Studio of the Year’.

We continue to take pride in our green-lighting process, and build on our portfolio strategy of films across varied budgets and languages backed by strong pre-sales to minimise the risk profile of our business.

Digitisation of cinema screens has changed the landscape of Indian cinema in several ways. At Eros, we have leveraged this trend to ensure faster consumer reach and tighter cost control, and further consolidate our leadership position.

Eros continues to lead innovations in the industry and our initiative of Trinity Pictures, India’s first franchise film label is progressing well with 4 films expected to enter into production, including 2 Indo-China film productions. We believe that with these initiatives in the years to come we will be able to develop new and non-traditional revenue streams such as gaming, merchandising and opening new markets such as China for theatrical releases. Equally Eros Now, the entertainment portal owned by our parent company, Eros International Plc. is growing well and we are proud to have garnered over 44 million registered users.

At Eros, we remain committed to serve our audiences better; and in this context I would like to thank the extraordinary effort of our employees and partners.

We are entering FY2017 with an exciting collection of over 65 content driven Eros films in Hindi and other regional languages, making it the biggest future slate by any studio in India. We have already entered into pre-sales of satellite rights for Housefull 3, Dishoom, Baar Baar Dekho, Rock On 2, Banjo amongst others along with some regional films which give us a good revenue visibility and mitigate risk.

I am confident that with our clear strategic focus and our scaled up and differentiated business model we will continue to deliver encouraging results in the future.

On behalf of our entire leadership team, I thank all our shareholders and associates for their continued support.

(from Annual Report 2015-16)