Bharti Airtel Q2 profit declines 77%

Bharti Airtel results for the second quarter ended September 30, 2017 has shown a profit decline of 77 per cent to reach Rs. 343 crore from Rs. 1,461 crore in Q2 2016.

The consolidated revenues for Q2’18 at Rs. 21,777 crore has also shown Y-o-Y drop of 10.4% on an underlying basis. Consolidated mobile data traffic at 853 Mn MBs in the quarter has registered a robust Y-o-Y growth of 294% on an underlying basis.

India revenues for Q2’18 at Rs 16,728 crore have declined by 13% Y-o-Y primarily led by mobile drop of 16.8% Y-o-Y. Mobile data traffic has grown fourfold to 784 billion 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 million from 41.3 million 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 billion MBs in the quarter as compared to 34 billion MBs in the corresponding quarter last year.

Data customers increased by 20.1% to 21.7 million from 18.1 million 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 South Asia margin drop of 5% 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.

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.

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.”

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. 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.”