Bharti Airtel Ltd today reported a 30% drop in net income at Rs 721.2 crore during the July-September quarter on increased network costs, squeezed margins due to stiff competition, and is looking to increase tariff. It had posted a net income at Rs 1027 crore in the corresponding quarter the previous fiscal year .
During the April-June quarter it reported net income at Rs 762.2 crore, about five% higher than that of the second quarter this fiscal.
“We have lost close to 40% pricing power in the last 12 quarters. Considering the inflation that has hit the country over the last 12 quarters, least we deserve is to go back to the levels we were at,” Bharti Airtel CEO (India and South Asia) Sanjay Kapoor told reporters here today. Kapoor said prices have to rise as the “present model is not sustainable”.
Asked whether they have calculated the additonal burden that they have to face financially due to -refarming, one time fee and auctions Kapoor said: "We are yet to take a decision on this issues as the polciies have not been finalised till now">
Total revenue rose 17% to Rs 20273.2 crore during the quarter under review as against Rs 17269.8 crore in the same period a year-ago. “Despite the seasonally most weak quarter, I think this performance is satisfactory,” said Kapoor.
Meanwhile, the company has received Rs 586 crore during the July-September quarter because of a favourable order order by TDSAT to an outstanding dispute pertaining to inter-connect agreements. The helped the cmpany is reporting hight revenues and higher profit before tax and net income during the quarter. According to an analyst, Bharti Airtel could have reported degrowth in revenues, profit before tax and net income from Indian operations.
The telecom market leader’s subscribers in India fell as the company embarked upon a strategy to weed out inactive customers (as additional spectrum allocation is no longer linked to number of subscribers) but faced with a high churn ( 8.5% in the quarter), average revenue per user dipped 4% to Rs 177 in India during July-September quarter, compared to Rs 185 in April-June quarter.
In Africa, however the ARPU dip was less substantial at 2% to USD 6.4.
Also the total number of minutes on the India network also dipped by 2% this quarter of the previous one.
However the company’s EBITDA margin increased marginally to 31.3% in July-September quarter from 30.2% in the previous quarter.
The total average voice use per user dropped to 417 minutes during July-September from 433 minutes during April-June reflecting seasonal slowdown in consumption.
As on September 30, 2012, Bharti Airtel recorded 5.4 million active 3G customers of which 4 million are active 3G data customers a clear reflection that the expected numbers which operators had anticipated while bidding huge amounts for the spectrum has not fructified at all. .
Its data ARPU stood at Rs 43 in India backed by 133 MBs of data download per user per month.
Kapoor said Bharti Airtel is expanding its 4G network in the country and is expected to cover five more cities soon.
Bharti Airtel, which has licence for 4G services in Maharashtra, Kolkata, Karnataka and Punjab, has acquired stake in Qualcomm's Indian venture which has licence for 4G services in Delhi, Mumbai, Kerala and Haryana circles.
On its African operartions joint managing director Manoj Kohli said: “We have achieved leadership position in most of the African market," However, he admitted that the company is facing tough competition in Nigeria as the market leader has dropped tariffs by 30 percent, adding that Bharti Airtel is still gaining market share in Nigeria.