Airtel revenue up 42 percent, touches Rs.90 bn (Second Lead)October 31st, 2008 - 5:59 pm ICT by IANS
New Delhi, Oct 31 (IANS) Telecom major Bharti Airtel Friday said its consolidated revenue has grown 42 percent to Rs.90.2 billion (Rs.9,020 crore) in the quarter ended Sep 30.Bharti’s net income stood at Rs.20.46 billion ($415 million) in the second quarter, up 27 percent from Rs.16.14 billion a year earlier, the company said here.
It reported cash profit from operations at Rs.31.25 billion (Rs.3,125 crore) as compared to Rs.25.97 billion (Rs.2,597 crore), recording a 20 percent growth.
The increase in net income was on account of a record subscriber addition in the quarter under review, taking Airtel’s customer base to 79.9 million as of Sep 30 - reflecting an increase of 57 percent from the same date last year.
“We have added more than eight million customers in the last quarter, which makes Bharti the third largest telecom company globally,” claimed Manoj Kohli, CEO of Bharti Airtel’s mobile services.
However, the company suffered a foreign exchange loss of Rs.5.86 billion.
Although its revenue crossed the Rs.90-billion mark in the July-September quarter and customer base rose to 80 million, the company suffered a foreign exchange loss of Rs.5.86 billion due to a weaker rupee, which fell about 9 percent against the dollar in July-September.
Shares in Bharti, India’s third-most valuable firm with a market value of about Rs.1,160 billion, were up 0.14 percent at Rs.615.90 on the Bombay Stock Exchange (BSE) after reaching an 8 percent gain earlier.
“The company has to write mark-to-market the entire loan irrespective of whether it is hedged or not. As long it is hedged, the impact will be notional,” Bharti Airtel deputy CEO Akhil Gupta said.
“We hedge a significant portion of our loans. The loss of Rs.586 crore (Rs.5.86 billion)is due to the accounting on foreign exchange and derivatives. This happens in every quarter. When rupee appreciates, it results in a gain and vice versa,” he said.
Voluntary customer churn also remained flat at around 1.1 percent, indicating Bharti has not seen much erosion in its subscriber base. “Customer churn level, be it voluntary or company initiatives, shows people still prefer Airtel over other operators,” Kohli said.
”Though the company’s SMS (short messaging services) revenues has fallen 4.3 percent in the September quarter from 4.6 percent a year earlier, 10 percent of our revenues come from value-added services, that is VAS,” he said.
Bharti’s earnings before interest, taxes, depreciation and amortization (EBITDA) of Rs.36.99 billion (Rs.3,699 crore) grew 37 percent on a year-on-year basis.
Kohli said the company has received spectrum for three circles - Karnataka, Tamil Nadu and Bihar and is entitled to receive the same for six more circles from the government.
Average revenue per user per month, a benchmark for mobile phone companies, fell to Rs.335 from Rs.366 a year ago.
Bharti’s internal cash generation exceeded its spending on expanding networks and services in the quarter for the first time since 1994, Akhil Gupta, deputy group chief executive officer of the operator’s parent Bharti Enterprises Pvt., told reporters.
“In this industry, in today’s environment when liquidity is in severe crunch it has given Bharti Airtel an edge over new entrants,” Gupta added.
“Each of them has huge funding needs,” he said.