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Bharti Airtel posts results for quarter ended December 2017; profits continue to plunge

January 18, 2018

Bharti Airtel has posted a 39 per cent decline in its net income (net profits) from Rs 5.04 billion in quarter ended December 2016 to Rs 3.06 billion in the corresponding quarter in 2017. The overall consolidated revenue declined by about 13 per cent from Rs 233.36 billion to Rs 203.19 billion during the same period.

Region wise, revenues from the operator’s India operations registered a decline of 15 per cent from Rs 180.12 billion in quarter ended December 2016 to Rs 152.94 billion in the corresponding quarter in 2017. Meanwhile, EBITDA (earnings before interest, tax, depreciation and amortisation) declined by 20 per cent from Rs 72.51 billion to Rs 57.66 billion during the same period.

The year-on-year de-growth was primarily impacted by a drop of 22 per cent in revenues from mobile services, comprising of mobile services and network groups building / providing fiber connectivity. The revenues from mobile business declined from Rs 138.13 billion to Rs 107.51 billion during the period under consideration. In contrast, revenues from other businesses including Digital TV and Airtel Business have recorded healthy year- on-year growth of about 10 per cent and 7 per cent respectively.

In a statement, Gopal Vittal, MD and CEO, India & South Asia, said: “Regulatory fiat in the form of a cut in domestic interconnect usage charges (IUC) rates has exacerbated the industry ARPU decline in Q3’18. The recent announcement of reduction in International termination rates will further accentuate this decline and benefit foreign operators with no commensurate benefit to customers.”

On the operations side, the mobile data traffic recorded a whopping 543.6 per cent growth (more than 6x) from 172 billion MBs in quarter December 2016 to 1,106 billion MBs in the corresponding quarter in 2017. Mobile broadband customers grew by 64.9 per cent to 37.7 million to 62.1 million during the same period.

“Continued investments in data capacities, strategic partnerships with content and handset providers and focus on customer friendly innovations like data rollover have led to healthy customer additions of 8.1 million during the quarter. Q3’18 has also seen the highest ever broadband site deployment of 32,000 in any quarter, complementing the robust data and voice traffic growth of 544 per cent and 50 per cent respectively on a Y-o-Y basis.”, added Vittal in the company statement.

Meanwhile, its Africa revenues declined by 4 per cent from Rs 53.55 billion to Rs 51.29 billion during the period under consideration. EBITDA from African operations however increased by 40 per cent from Rs 12.94 billion in quarter ended December 2016 to Rs 18.18 billion during the corresponding quarter in 2017.

The company’s consolidated net debt has increased to Rs 917.14 billion in quarter ended December 2017 from Rs 914.80 billion during the quarter ended September 2017. Net debt excluding the deferred payment liabilities to the Department of Telecommunications (DoT) and finance lease obligations has decreased by Rs 7.24 billion sequentially in the quarter. Net debt to EBITDA ratio for the quarter was at 3.01 times (vs. 2.91 times in the previous quarter). Lower EBITDA along with rising spectrum costs and continued investments in India have resulted in deterioration of return on capital employed to 4.9 per cent in quarter-ended December 2017 from 7.1 per cent in the corresponding quarter in 2016.

 

 
 

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