Data grows fourfold for Airtel but revenues continue to fall

Data grows fourfold for Airtel but revenues continue to fall

"The financial stress in the industry continues due to double digit revenue decline and will be further accentuated by the reduction in IUC (Interconnect Usage charges) rates in the next quarter", PTI quoted Gopal Vittal, CEO, India. On sequential basis, profit fell 5.11 percent sequentially, the company said in an exchange filing.

However, mobile data traffic has grown fourfold to 784 billion MBs in the quarter as compared to 178 billion MBs in the corresponding quarter a year ago.

The company said it had "stepped up" the capex investments in the quarter on the back of data coverage and capacity.

The consolidated revenues of the company spanning 17 countries - India, Sri Lanka and 15 in Africa - declined 11.7 per cent to Rs 21,777 crore for the reported period as compared to Rs 24,652 crore a year ago.

Airtel's second quarter net profit of 3.43 billion rupees ($53 million) was its smallest profit in 19 quarters and its sixth consecutive drop in quarterly profit.

Bharti Airtel, along with other incumbent telecommunication service providers, has been engaged in a fierce tariff war with Mukesh Ambani-controlled Reliance Jio.

The company's weak result is primarily because of intense competition led by Reliance Jio Infocomm and low tariffs war which is continuing in the sector. The company reported consolidated revenues of Rs 21,777 crore.

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Its data customer base increased to 65.77 million at the end of September quarter 2017, higher by 5.1 percent compared with previous quarter.

Quarterly net finance cost rose by Rs 420.9 crore on year, with consolidated net debt totalling Rs 91,480 crore compared with Rs 81,480 crore a year ago.

Africa revenues for the quarter stood at Rs 5,203 crore as against Rs 5,272.6 crore in the corresponding quarter previous year.

Revenue from Africa business grew 2.6%, while the company's efforts to control costs in the market helped expand its operating margins by 9.1% on a constant currency basis.

Separately, Bharti Infratel on Monday reported a 17 percent drop in second-quarter profit to 6.38 billion rupees, missing analysts' estimate of 7.41 billion rupees. Revenue from operations on standalone basis declined 3.6 percent to Rs 13,980.1 crore for quarter ended September 2017.

Shares of Bharti Airtel ended 0.98% higher in Mumbai trading before the release of the earnings, while the benchmark S&P BSE Sensex closed 0.2% lower.

A year ago, Airtel had reported a September quarter net loss of Rs 622.7 crore for its Africa operations. Foreign exchange and derivative loss for the quarter was Rs 422 crore compared to loss of Rs 302 crore in the corresponding quarter previous year.

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