Telecom companies posted mixed results during the quarter ended September 2016. While operators such as Bharti Airtel, Idea Cellular and Tata Communi­cations reported a decline in their consolidated year-on-year profit, tower company Bharti Infratel and equipment vendor Ster­lite Technologies reported an increase in their consolidated net profit. Vodafone India and Telenor India reported a jump in their revenues.

Notably, since most companies have now adopted the Indian Accounting Standards (Ind-AS) – which are compliant with the International Financial Reporting Standards (IFRS) – for reporting their financial results,  the results of this quarter are not exactly comparable with those of the corresponding quarter in 2015.

Bharti Airtel

Bharti Airtel reported a decline of around 5 per cent in its year-on-year consolidated net profit for its India operations. The operator’s net profit fell to Rs 14.61 billion during the quarter ended September 2016, from Rs 15.36 billion reported in the corresponding quarter in 2015. According to the operator, the decline can be attributed to the increase in spectrum-related costs. Meanwhile, total revenues increased by 3.4 per cent to Rs 246.51 billion during the quarter ended September 2016 from Rs 238.35 billion during the corresponding quarter in 2015. The higher revenues resul­ted in an increase of 14.5 per cent in the operator’s earnings before interest, taxes, depreciation and amortisation (EBITDA) from Rs 82.65 billion during the quarter ended September 2015 to Rs 94.66 billion during the corresponding quarter in 2016. The EBITDA margin increased by 3.7 percentage points from 34.7 per cent to 38.4 per cent during this period.

The operator’s average revenue per user (ARPU) decreased by 2.5 per cent from Rs 193 to Rs 188. Voice ARPUs declined by 5.9 per cent from Rs 140 to Rs 132 during the reporting period. Meanwhile, data ARPUs increased by 4.2 per cent from Rs 193 to Rs 201. The total MBs on the network also increased by 54.9 per cent from 114.96 billion MB to 178.12 billion MB. Meanwhile, Airtel’s revenues from its Africa operations (in constant currency) improved by 4 per cent from $866 million during the quarter ended Septem­ber 2015 to $898 million during the corresponding quarter in 2016. Its EBITDA increased by 29 per cent, from $163 million to $211 million, and the EBITDA margin increased from 18 per ce­nt to 23.5 per cent.

For its South Asia operations, Airtel reported a year-on-year growth of 3 per cent in its total revenues, which rose from Rs 4.04 billion during the quarter ended September 2015 to Rs 4.16 billion during the corresponding quarter in 2016. The operator’s EBITDA improved from a negative Rs 0.24 billion to Rs 0.21 billion.

Vodafone India

Vodafone India reported a 5.8 per cent growth in its total revenues, from Rs 214.04 billion during the half-year ended September 2015 to Rs 226.54 billion during the corresponding period in 2016. Higher revenues resulted in a 2.6 per cent increase in the operator’s EBITDA, from Rs 65.34 billion to Rs 67.04 billion, during the same period.

The operator witnessed a 6.7 per cent increase in its mobile customer base from 0.18 billion during the half-year ended September 2015 to 0.2 billion during the corresponding period in 2016. Meanwhile, the operator’s average revenue per minute (ARPM) stood at Re 0.48, while the voice ARPM stood at Re 0.32 during the half-year ended September 2016. The operator’s data business contributed about 20.8 per cent to the overall revenue. Further, the data ARPU for consumers using data higher than 1 MB increased from Rs 158 to Rs 164 during the reporting period.

Idea Cellular

Idea Cellular reported a decline of 88 per cent in its year-on-year consolidated net profit for the quarter ended September 2016. Its net profit fell from Rs 7.62 billion during the quarter ended September 2015 to Rs 0.91 billion during the corresponding quarter in 2016. According to the operator, the decline was due to the higher network running expenses incurred due to accelerated expansion, increased subscriber acquisitions and servicing costs, and inflationary pressures. This led to an increase in the overall operating cost. The company’s revenues rose by 7.11 per cent from Rs 86.75 billion during the quarter ended Septem­ber 2015 to Rs 93 billion during the corr­esponding quarter in 2016. The EBITDA increased by 1.8 per cent from Rs 27.9 billion to Rs 28.4 billion. However, the EBITDA margin declined from 32.2 per cent to 30.5 per cent.

Meanwhile, the operator’s blended ARPU decreased from Rs 175 during the quarter ended September 2015 to Rs 173 during the corresponding quarter in 2016. Voice ARPUs declined from Rs 126 to Rs 122. Idea added 5 million mobile data customers during the quarter ended Sep­tember 2016, taking the total number of data users on its network to 54 million. The blended mobile data ARPU (which includes 2G, 3G and 4G services) declined from Rs 144 to Rs 130 during the reporting period.

RCOM

Reliance Communications (RCOM) has reported a year-on-year decline of 80 per cent in its net profit, from Rs 1.95 billion during the quarter ended September 2015 to Rs 0.39 billion during the corresponding quarter in 2016. This was on account of a 4.33 per cent fall in the operator’s total revenue, from Rs 53.3 billion to Rs 51 billion, during the same period. The operator has attributed the dip in revenues to the migration of its CDMA customers to 4G services, increase in competitive intensity and seasonality factors. Further, the operator reported a 14.1 per cent decline in its EBITDA, from Rs 17.95 billion during the quarter ended September 2015 to Rs 15.41 billion during the corresponding quarter in 2016. Meanwhile, its ARPU fell from Rs 155 to Rs 138. Further, the share of data services in the overall revenues declined from 36 per cent to 27.1 per cent.

Telenor India

Telenor India reported a 9.49 per cent in­crease in its total revenues for the quarter ended September 2016. The total revenues of the operator increased from NOK 1,411 million in the quarter ended September 2015 to NOK 1,545 million in the corresponding quarter in 2016. This was despite an increase in the year-on-year net loss, from NOK 373 million to NOK 4,043 million. Meanwhile, the operator’s EBITDA improved from a negative NOK 58 million to NOK 132 million. Accor­ding to the operator, this can be attributed to the significant revenue growth and positive effects of the ongoing network modernisation programme. The operator’s ARPU decreased from NOK 12 in the quarter ended Sep­tember 2015 to NOK 11 in the corresponding quarter in 2016. Moreover, its subscription base was 9 per cent higher in the quarter ended September 2016 than the corresponding quarter in 2015.

Tata Communications

Tata Communications reported a 64.4 per cent decline in its consolidated year-on-year net profit for the quarter ended Sep­tember 2016. Its profit after tax declined from Rs 1.12 billion during the quarter ended September 2015 to Rs 0.4 billion during the corresponding quarter in 2016. The company’s profit increased on the back of higher net revenues, which rose by 0.8 per cent from Rs 26.42 billion to Rs 26.63 billion. The operator’s finance costs decreased marginally by 0.3 per cent from Rs 1.774 billion to Rs 1.77 billion. Meanwhile, the EBITDA witnessed a year-on-year growth of 7.5 per cent, increasing from Rs 8.07 billion during the quarter ended September 2015 to Rs 8.68 billion during the corresponding quarter in 2016. The EBITDA margin improved from 15.7 per cent to 17.1 per cent.

Bharti Infratel

Bharti Infratel reported a 30.8 per cent increase in its consolidated net profit, which increased from Rs 5.92 billion during the quarter ended September 2015 to Rs 7.74 billion during the quarter ended September 2016. This was on the back of an 8.25 per cent rise in the company’s revenues, which grew from Rs 30.4 billion to Rs 32.9 billion during the same period. The higher revenues led to an improvement in the EBITDA, from Rs 13.17 billion to Rs 14.54 billion. In addition, the company’s income from operations increa­sed by 9.01 per cent from Rs 13.73 billion to Rs 14.96 billion. Meanwhile, its expenses rose by 2.98 per cent from Rs 106.43 billion to Rs 109.6 billion.

The total number of towers installed by the company increased from 87,184 to 89,791 during the reporting quarter.

Sterlite Technologies

Sterlite Technologies reported a 40.28 per cent increase in its net profit, which increased from Rs 0.39 billion during the quarter ended September 2015 to Rs 0.56 billion during the corresponding quarter in 2016. However, the company’s total in­come from operations decreased from Rs 5.71 billion to Rs 5.5 billion. The total expenditure of the company increased marginally, from Rs 4.85 billion to Rs 4.86. Meanwhile, the company won new orders worth Rs 7.31 billion during the quarter ended September 2016.

Puneet Kumar Arora with Kuhu Singh