The board of Hum Network Limited (HUMNL) has convened a meeting on 26th Oct’22 to discuss and approve the result for 1QFY23.

We project the company to post earnings of PKR 494mn (EPS: PKR 0.52) against PKR 217mn (EPS: PKR 0.24) in SPLY and PKR 347mn (EPS: PKR 0.36) during 4QFY22. The 2x YoY jump in profitability is expected on the back of a 56% YoY surge in company topline primarily due to augmented revenue from advertisements run on Hum TV and Hum News channels.

In particular, in a notice disseminated to the stock exchange in Dec’21, the company had notified that the public sector advertisement rates for Hum News had been revised by the Ministry of Information and Broadcasting to PKR 140,000/minute from PKR 100,000/minute previously. Apart from this, the company’s social media presence continues to grow; as per Social Blade – an American website created in 2008, to track social media statistics and analytics – subscribers and views of Hum TV’s YouTube account have shown a massive growth.

Subscribers at the end of Sep’21 were 15.8mn while they crossed 22.8mn by the end of the outgoing quarter this year. Moreover, views per week jumped up from 9.9bn last year (1QFY22 end) to 17.7bn views per week by the end of Sep’22. This, alongside USD appreciation, will aid the company’s subscription income. In addition, margins are expected to remain stable on a YoY basis at 43% however, improvement will be observed on a QoQ basis. During the last quarter, due to a change in recognition of certain administration related costs in COGS as recommended by auditors, company margins were axed to 30% as the entire year’s technical advisory fee was booked in the last quarter. This will be normalized in 1QFY23.

Courtesy – AHL Research