Vodafone Idea has announced the financial results for quarter ended June 2020. Revenue for the quarter stood at Rs 106.6 billion, a decline of 9.3 per cent QoQ on account of large-scale lockdown and disruption of economic activities. On reported basis, EBITDA for the quarter declined to Rs 41 billion, a QoQ decline of 6.4 per cent. Despite a sharp revenue decline, EBITDA excluding IndAS 116 impact declined by Rs 1.8 billion to Rs 15.4 billion, after adjusting for one-off of Rs 3 billion, vs Rs 17.1 billion in Q4FY20 (after adjusting for one-off of Rs 4 billion) as impact of lower revenue was largely offset by reduction in subscriber acquisition costs due to lower gross additions during the quarter, marketing costs and other expenses as well as other cost optimisation initiatives. The EBITDA margin, excluding IndAS 116 impact and adjusted for one-offs, stood at 14.4 per cent vs 14.6 per cent in Q4FY20.

Gross debt (excluding lease liabilities) as of June 30, 2020 was Rs 1,189.4 billion, including deferred spectrum payment obligations due to the government of Rs 922.7 billion. Cash and cash equivalents were Rs 34.5 billion and net debt stood at Rs 1,155.0 billion (vs Rs 1,125.2 billion in Q4FY20).

Capex spend in Q1FY21 of Rs 6.0 billion was lower compared to Rs 18.2 billion in Q4FY20, as the rollout in Q1 was impacted by COVID-19 with disruptions to equipment supply and logistics following the nationwide lockdown.

Announcing the Q1 FY2020-21 results, Ravinder Takkar, managing director and chief executive officer, Vodafone Idea Limited, said, “During the nationwide lockdown due to COVID-19 pandemic, our teams did a phenomenal job of providing seamless high quality services, keeping people and businesses connected during these unprecedented times. Q1FY21 was a challenging quarter as availability of recharges due to store closure and ability of customers to recharge on account of economic slowdown were impacted. 4G coverage and capacity expansion remains a priority for us to further improve our customers’ experience and we continue to lead the league tables on 4G data download speeds across several states, metros and large cities. We continued to make progress on our strategy with integration largely complete, enabling us to realise costsynergies well ahead of our initial targets.We have launcheda new cost optimisation initiative that will drive further costsavings. We also continue to actively engage with the government seeking a comprehensive relief package for the industry, which faces critical challenges.”

Operational highlights

Subscriber churn reduced to an all-time low of 2 per cent (3.3 per cent in Q4FY20), as net disconnections were lower during the quarter. However, the gross additions were severely impacted by closure of retail stores during the nationwide lockdown resulting in subscriber base decline to 279.8 million in Q1FY21 from 291.1 million in Q4FY20. ARPU for Q1FY21 was Rs 114 vs Rs 121 in Q4FY20.

At the end of the quarter, the 4G subscriber base was 104.6 million. Total data volumes grew by 10.6 per cent (40.4 per cent YoY), to 4,523 billion MB compared to the last quarter, being the highest growth in the last 6 quarters. Total minutes on the network declined by 6.0 per cent during the quarter.