Reliance Communications (RCOM) has reported a 61.25 per cent decline in its net profit from Rs 4.80 billion for the quarter ended December 2010 to Rs 1.86 billion for the corresponding quarter in 2011.
This is the tenth straight quarterly decline in profits, recorded by the operator. RCOM?s revenues stood at Rs 50.52 billion for quarter ended December 2011, registering a mere 1 per cent increase from Rs 50.04 billion for the corresponding quarter in 2010. Of the total revenue, Rs 44.47 billion (almost 63 per cent) was contributed by the wireless segment. Earnings before interest depreciation tax and amortisation (EBITDA) for the quarter under review stood at Rs 16.11 billion. RCOM?s EBITDA margin at 31.9 per cent was amongst the highest in the industry during October-December 2011.
The operator had 150 million subscribers at the end of December 2011, second only to Bharti Airtel. Between October 2011 and December 2011, the company added 3 million subscribers, of which 2.8 million were 3G subscribers.
Recently, RCOM has sought funding from Industrial and Commercial Bank of China (ICBC), China Development Bank (CDB), Exim Bank and other banks, to refinance about $1.18 billion of foreign-currency convertible bonds due for redemption on March 1, 2012. RCOM will benefit from extended loan maturity of 7 years and interest cost of 5 per cent.
Going forward, RCOM aims to repay its Rs 367 billion debt by March 2013. Crucial to this, will be the sale of its tower arm, Reliance Infratel, for an estimated Rs 150 billion and the Singapore based listing of its undersea cable business, which could generate another Rs 75 billion.
