RS banking on Ch 8, health and beauty arm for revenue growth

Corporate January 11, 2017 01:00


DIGITAL TV station Channel 8 and health and beauty business will be the two key drivers for RS’s revenue growth this year, with total income of Bt3.5 billion, according to the head of the music and entertainment powerhouse.

“Of total revenue this year, 75 per cent will be from media, 15 per cent from health and beauty, 5 per cent from music and 5 per cent from other business,” chief executive officer Surachai Chetchotisak said yesterday. 

He believes that the digital-TV industry this year will perform better than last year thanks to a number of relief measures endorsed by the military’s ruling National Council for Peace and Order and the National Broadcasting and Telecommuni-cations Commission (NBTC). 

Last year, the NCPO issued an order under Article 44 of the interim charter on relief measures for 22 commercial digital-TV broadcasters that had been affected by the sluggish economy and the national tragedy in October. 

Under the order, the broadcasters are permitted to extend the payment period from three to six years for the remaining instalments on their upfront licence fees. 

Surachai said RS was interested in taking advantage of the extended payment period to reduce financial stress by adding cash flow. He explained that the annual interest that would be incurred under this option was acceptable and reasonable. 

Apart from that, the NBTC also approved a financial subsidy for satellite transmission under the “must carry” rule and a new sliding scale for annual licence fees and contributions to the commission’s media research and development fund. 

Channel 8 will invest about Bt700 million on content production and acquisition to boost TV ratings and advertising revenue. The channel aims to have an average of 500,000 viewers per minute by the end of this year, up from 350,000 now. It also expects to generate Bt2 billion in revenue, similar to last year. 

To expand its audience base, Channel 8 has bought the right to broadcast a top-rated Indian series. Last year, the channel also introduced South Korean series to attract young viewers. 

Another flagship RS enterprise is its Life Star health and beauty business. This year, Life Star plans to expand its modern trade channel and other outlets. 

Surachai acknowledged that the music, radio and satellite-TV businesses were stagnant. To make those units profitable, the company will focus on reducing fixed costs.