Airtel India Q3 loss narrows to Rs 972 crore QoQ
ARPU rose 4.1% on quarter to Rs104, but was 15.5% lower than a year back.
Consolidated net profit in the three months ended December was 72% lower from a year earlier and a drop from Rs 119 crore reported for July-September, including a one-time gain. This was the 11th straight quarter of declining profit for Airtel.
The nation’s second-largest telecom company said quarterly revenue from local mobile services was Rs 10,189 crore, less than Jio’s Rs 10,383 crore, underlining the Mukesh Ambani-owned telco’s growing strength. Jio reported a fifth straight quarter of profit at Rs 831 crore, up 65%.
Airtel’s net exceptional gain of Rs 1,017 crore was “largely on account of deconsolidation of Airtel Payments Bank,” the company said in a statement Thursday. The telco also had a tax write-back of Rs 579 crore.
India revenue fell 3% on year and 1% sequentially, but the decline was arrested by the initial effects of the telco’s minimum average revenue per user (ARPU) plans and higher data consumption. Mobile services contributed 69% of the India revenue.
Its India mobile ARPU rose 4.1% on quarter to Rs 104, but some users chose to leave the operator rather than recharge at a higher rate. ARPU gained for the first time after 10 quarters, suggesting that the worst could be behind it.
Airtel’s India subscriber base fell 14.6%, or almost 49 million, sequentially to end the quarter at 284.2 million. The percentage of people leaving the Airtel network rose to 7.3% from 4.1% in the second quarter. This dragged overall numbers down over 10% on quarter to 384.7 million across India, South Asia and 14 African countries.
“Effective this quarter, we have modified our customer base measurement to represent only transacting and revenue-generating customers,” Gopal Vittal, managing director, India & South Asia, said in the statement. He said over 11 million 4G customers had been added, almost tripling mobile data volumes on year.
Consolidated revenue rose 1% year-on-year to Rs 20,519 crore and from Rs 20,422 crore in the preceding quarter, partly helped by its Africa operations, where revenue grew over 15% on year. Net income, before exceptional items, for the continent surged to Rs 551.8 crore from Rs 176.2 crore a year ago, propelled by increased consumption of voice and data services.
Airtel shares climbed 1.3% to Rs 307.15 at the close on the BSE on Thursday, a day after the company said the Africa unit would raise $200 million from Qatar Investment Authority to pare debt.
The earnings were announced after market hours.
Airtel’s earnings before interest, tax, depreciation & amortisation (Ebitda) for the quarter stood at Rs 6,307 crore, down 0.5% on quarter, compared with an over 7% sequential fall in the July-September period.
“Airtel’s consolidated Ebitda appears to have bottomed out and with India mobile revenues largely flattish sequentially in the December quarter, one can expect an improvement on this score in the fiscal fourth quarter, by when the full-beneficial impact of the minimum recharge plans should kick in,” said Naveen Kulkarni, a telecom analyst and head of research at Reliance Securities.
Capital expenditure for the quarter was Rs 6,568 crore compared with Rs 6,466 crore a year ago.
“We have deployed 24K broadband sites during the quarter and remain committed to invest in capacities ahead of the demand curve,” said Vittal.
Net debt rose to Rs 10,63,674 crore from Rs 9,17,139 crore a year earlier but was lower than about Rs 11,32,042 crore in the second quarter.
The company said its net finance costs fell about 7% to Rs 1,945 crore in the quarter largely on account of lower forex fluctuations.
Wider acceptance of Airtel’s bundled offers resulted in traffic growth of 42.1% to 703 billion minutes. Sequentially, voice minutes on the network and voice usage per subscriber rose 1.4% and 5.8%, respectively. Mobile data usage per customer rose 14% sequentially.