Bharti Airtel Limited (“Bharti Airtel” or “the Company”) today announced its audited consolidated Ind-AS results for the second quarter ended September 30, 2017.
The consolidated revenues for Q2’18 at Rs 21,777 crore, Y-o-Y drop of 10.4% (reported drop of 11.7%) on an underlying basis (viz. adjusted for Africa / Bangladesh divested operating units and tower assets sale). Consolidated mobile data traffic at 853 Mn MBs in the quarter has registered a robust Y-o-Y growth of 293.8% on an underlying basis
India revenues for Q2’18 at Rs 16,728 crore have declined by 13.0% Y-o-Y primarily led by mobile drop of 16.8% Y-o-Y. Mobile market continues to experience value erosion and financial stress led by competitive pressures. Mobile data traffic has grown fourfold to 784 Bn MBs in the quarter as compared to 178 Bn MBs in the corresponding quarter last year. Mobile broadband customers increased by 33.6% to 55.2 Mn from 41.3 Mn in the corresponding quarter last year
In constant currency (1st Mar’17) terms, Africa underlying revenues grew by 2.8% Y-o-Y (reported growth of 2.6% Y-o-Y). Mobile data traffic has grown by 83.8% to 63 Bn MBs in the quarter as compared to 34 Bn MBs in the corresponding quarter last year. Data customers increased by 20.1% to 21.7 Mn from 18.1 Mn in the corresponding quarter last year. Our continuous cost control initiatives have resulted in significant improvement of underlying EBITDA margin by 9.1% Y-o-Y and at 32.1%. Active Airtel Money customer base at 9.5 million, increasing the total transaction value on Airtel Money platform by 31.1% to $ 4.9 billion.
Consolidated EBITDA at Rs 8,004 crore declined 15.4% Y-o-Y with EBITDA margin dropping by 1.6% to 36.8%, led by India SA margin drop of 5.0% Y-o-Y on an underlying basis. Consequently, the consolidated EBIT dropped by 27.0% Y-o-Y to Rs 3,290 crore. Net interest costs of Rs 1,905 crore have risen from Rs 1,603 crore in the corresponding quarter last year – largely due to lower investment income. Forex and derivative loss for the quarter was at Rs 422 crore compared to loss of Rs 302 crore in the corresponding quarter last year. The Consolidated Net Income after exceptional items for the quarter stands at Rs 343 crore (Q1’18: Rs 367 crore) compared to Rs 1,461 crore in corresponding quarter last year.
The company’s consolidated net debt has increased to Rs 91,480 crore from Rs 87,840 crore in the previous quarter. Capex investments stepped up in the quarter behind both data coverage and capacity. Net debt excluding the deferred payment liabilities to the DOT and finance lease obligations has increased by Rs 2,554 crore sequentially in the quarter. Net debt to EBITDA ratio (LTM) for the quarter at 2.91 times (vs 2.67 times in the previous quarter). Lower EBITDA along with rising spectrum costs and continued investments in India have resulted in deterioration of Return on Capital Employed (ROCE) to 5.1% from 7.4% in the corresponding quarter last year.
In a statement, Mr. Gopal Vittal, MD and CEO, India & South Asia, said: “The financial stress in the industry continues due to double digit revenue decline and will be further accentuated by the reduction in IUC rates in the next quarter. This will eventually force operator consolidation and exits as we have witnessed in the recent past. Airtel remains committed to its goal of increasing revenue market share in this competitive environment by providing superior customer experience and strategically investing behind building more data capacities.”
In a statement, Mr. Raghunath Mandava, MD and CEO, Africa, said: “Airtel Africa underlying revenues grew by 2.8% Y-o-Y with net revenues growing 6.3% on the back of increase in data penetration. Data traffic grew by 83.8% Y-o-Y. Airtel Money continues to lead with transaction values growing over 30% Y-o-Y. Our efforts to create a profitable business model for Africa continues and we have delivered EBITDA margin of 32.1%, with underlying margins up 9.1% Y-o-Y. This has also now enabled the business to sustainably generate positive free cash flows. Our teams remain focused on accelerating growth through the three pillars of increasing mobile penetration, growing the data business and expanding the Airtel money base.”
