Financial Daily from THE HINDU group of publications
Wednesday, Dec 10, 2003
Financial Daily from THE HINDU group of publications Wednesday, Dec 10, 2003 |
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Info-Tech
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Telecommunications Salaries, licence fees drag BSNL net 77% Our Bureau
Mr Prithipal Singh, CMD, BSNL with Mr V. P. Sinha, Director, Planning, at a press conference in the Capital on Tuesday. - - Ramesh Sharma
New Delhi , Dec. 9 BSNL has registered a 77 per cent decline in its net profit for the year 2002-03, at Rs 1,444 crore from Rs 6,412 crore during the previous year. Announcing this after the third annual general meeting of the company held on Tuesday, Mr Prithipal Singh, Chairman and Managing Director of the company, noted that this decline in profit was mainly on account of the higher outgo of Rs 2,800 crore on salaries and wages, licence fee and spectrum charges and expenses on power. The salaries and wages had increased from Rs 3,900 crore in 2001-02 to Rs 6,300 crore in 2002-03 due to the company switching to the corporate wage structure. The company had to pay a licence fee and spectrum charges of Rs 3,400 crore, while the Government reimbursed only Rs 2,300 crore. BSNL has asked the Government to reimburse the remaining and as and when it is received, the profits would go up correspondingly to Rs 2,540 crore. About Rs 300 crore was spent additionally on fuel due to power cuts, he noted. It is estimated that the company would make higher profits, to the tune of around Rs 3,000 crore during the current fiscal since these lump sum payments would not be a burden. "The BSNL board has almost finalised two-three VRS packages which will be announced in a couple of months. About 3,000 employees, representing less than one per cent of the workforce, are expected to avail themselves of the VRS in the first year. This will bring down the outgo on salary and wages," he said. In this context, Mr Singh said that despite the sharp decline in tariffs, the gross revenues of the company increased by five per cent in 2002-03 to Rs 25,892 crore. It had a total investment of Rs 12,108 crore for expansion of the telecom network. "BSNL registered an impressive growth in turnover despite a highly volatile telecom market, which had experienced major decline in tariffs. The telecom market is experiencing a major shift in the customer base from the fixed wire basic telephones to cellular phones driving down the earnings per line, and creating a substantial churn in the customer base of the basic services. The revenue growth of BSNL in this environment is quite a remarkable achievement," said Mr Singh.
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