Bharti Airtel reports 39% fall in Net profit

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NewDelhi : India’s largest telecom operator Bharti Airtel has today reported over 39% drop in its consolidated net profit for the third quarter ended December 31, 2017 to about 306 crore, against 504 crore in the corresponding period last fiscal.

India revenues for Q3’18 at Rs 15,294 crore have declined by 11.3% Y-o-Y (15.1% on reported) on an underlying basis, adjusted for the impact in reduction of domestic termination rates. Y-o-Y de-growth primarily impacted by mobile drop of 17.6%. India other business have witnessed healthy growth e.g. 10.4% in Digital TV and 7.2% in Airtel Business on Y-o-Y basis. Mobile data traffic has grown more than 6x to 1,106 Bn MBs in the quarter as compared to 172 Bn MBs in the corresponding quarter last year. Mobile broadband customers increased by 64.9% to 62.1 Mn from 37.7 Mn in the corresponding quarter last year.

During the quarter, Bharti Airtel divested Ghana country operation in Africa. Effective current quarter, financials and operational parameters have been shown for balance 14 countries and the historical periods have been re-instated to make them comparable. In constant currency (1st Mar’17) terms, Africa revenues grew by 5.3% Y-o-Y led by strong growth in data and Airtel money transaction value. Mobile data traffic has grown by 95.3% to 66 Bn MBs in the quarter as compared to 34 Bn MBs in the corresponding quarter last year. Data customers increased by 39.4% to 23.3 Mn from 16.7 Mn in the corresponding quarter last year.

Active Airtel Money customer base increased to 10.4 million, boosting the total transaction value on Airtel Money platform by 37.9% to $ 5.4 billion. Our continuous cost control initiatives have resulted in significant improvement of EBITDA margin by 10.8% Y-o-Y and stands at 35.5%. Consolidated EBITDA at Rs 7,587 crore declined 11.5% Y-o-Y. Consolidated EBITDA margin increased by 0.6% to 37.3% in the quarter as compared to 36.7% in the corresponding quarter last year. Consolidated EBIT dropped by 26.5% Y-o-Y to Rs 2,701 crore. Net interest costs of Rs 2,081 crore have risen from Rs 1,810 crore in the corresponding quarter last year – largely due to lower investment income. During the quarter, forex and derivative losses was lower at Rs 7 crore compared to loss of Rs 126 crore in the corresponding quarter last year. The company’s consolidated net debt has increased to Rs 91,714 crore from Rs 91,480 crore in the previous quarter. Net debt excluding the deferred payment liabilities to the DOT and finance lease obligations has decreased by Rs 724 crore sequentially in the quarter. Net debt to EBITDA ratio (LTM) for the quarter 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 (ROCE) to 4.9% from 7.1% in the corresponding quarter last year.

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