Bharti Airtel today reported the first ever loss of Rs 940 crore from its mainstay India business for the June quarter as it bled to retain market dominance in the face of free voice calls and dirt cheap tariffs from Reliance Jio. Also Read - Jio Platforms: Qualcomm Ventures follows Intel Capital to invest Rs 730 crore for a 0.15 percent stake
Airtel, however, reported a Rs 97 crore net profit on a consolidated basis in the April-June period after taking into account revenues from its Africa business. Also Read - Zoom releases statement after JioMeet trolled for similarities
The firm’s India business had posted a net profit of Rs 834.9 crore in the first quarter of the previous 2017-18 fiscal and Rs 186 crore in the preceding January-March quarter. Also Read - Jio Platforms stake sale: Intel becomes 11th investor with Rs 1,894.50 crore investment
“Industry pricing continues to remain untenable. However, led by our successful bundles, content partnerships and handset upgrade programs, our mobile data traffic surged 355 per cent on a year-on-year basis,” the company’s MD and CEO (India and South Asia) Gopal Vittal said in a statement.
The consolidated net profit in April-June was 73 per cent lower than Rs 367 crore in the same period a year ago.
Consolidated income of Bharti Airtel declined by 8.6 per cent to Rs 20,080 crore for the first quarter of this fiscal from Rs 21,958 crore in corresponding period of 2017-18.
The Africa business, an investment which was once regretted by the company’s founder Sunil Bharti Mittal, helped the company post positive income.
Bharti Airtel’s Africa operations recorded net income of Rs 393.9 crore before exceptional item while India and South Asia business pulled it down by loss of Rs 982.5 crore.
An exceptional gain on account of deferred tax asset of Rs 515.6 crore in Nigeria rescued the India-based telecom major from posting its first ever consolidated net loss.
The company’s operational performance was also dragged down by a 16 per cent rise in finance cost to Rs 212.65 crore (from Rs 182.74 crore) and forex losses. The net debt of the company reached Rs 1.03 lakh crore in the just ended quarter.
Bharti Airtel’s India performance continued to face turbulence from the ongoing tariff war despite high level of investments and increase in usage of services.
The average revenue per user on Bharti Airtel’s India network declined by around 32 per cent to Rs 105 from Rs 154 on year-on-year basis.
With the acquisition of Telenor’s India business, the mobile subscriber base of Airtel increased by 28 per cent to 344.6 million as on June 30, 2018 compared to 280.6 million in the corresponding quarter of last year.
Airtel in India acquired 8.7 million additional data customers compared to previous quarter, thus taking the total count of internet users on its network to 94.8 million at the end of the quarter.
“Aggressively expanding our 4G capacities and continuing to offer highest data speeds to customers remains a key priority for us, and towards this end, first quarter of financial year 2019 has seen our highest quarterly capex spends of Rs 7,887 crore,” Vittal said.
By the end of the reported quarter, the company had 1,67,355 network towers as compared to 1,62,380 towers in the corresponding quarter last year.
Africa, the saviour of the company’s financial performance during the quarter, reported 14 per cent increase in gross revenue in US dollar terms.
Airtel Africa’s gross revenue grew by 14 per cent on a Y-o-Y basis. We have rolled out about 1,000 broadband towers during the quarter. We continue our focus on profitable growth through superior customer offerings and expanding our Airtel money base – which now transacts more than USD 24 billion on an annualised basis, Airtel Africa MD and CEO Raghunath Mandava said.
Airtel operates in 14 African countries where it offers 3G services in all of them and 4G services in 9 markets.
Data traffic in Africa on Airtel’s network grew by 75 per cent, voice minutes increased by 44 per cent and Airtel Money throughput grew by 43 per cent on a y-o-y basis.
Shares of Bharti Airtel today closed at Rs 357.6 a unit, up by 1.63 per cent compared to the previous close, on BSE today.
This is published unedited from the PTI feed.