Bharti Airtel Q4 profit down 28% on higher interest outgo

Thomas K. Thomas New Delhi | Updated on March 12, 2018 Published on May 02, 2012

A file photo of Mr Sunil Bharti Mittal, Chairman & Managing Director, Bharti Airtel Ltd.


Bharti Airtel reported its ninth straight quarterly profit decline owing to higher interest costs and foreign exchange fluctuation losses.

The company reported a 28.2 per cent decline in its net profit to Rs 1,006 crore during the fourth quarter ended March 31, 2012. The consolidated net income was at Rs 1,401 crore during the corresponding quarter last year.

The telecom services company said that it was impacted by higher costs on account of 3G licence fee amortisation (Rs 106 crore), 3G interest costs (Rs 84 crore), forex fluctuation losses (Rs 132 crore) and tax provisions (Rs 198 crore).

The bad run, however, does not appear to be nearing an end with the company facing huge regulatory hurdles. “The recent regulatory developments in India will have significant implications on the future of telephony and broadband, as well as India's global competitiveness,” Mr Sunil Mittal, Chairman Bharti Airtel, said in a statement.

But the markets shrugged off the numbers as the company's share price was 2.47 per cent higher than yesterday's close at Rs 317.95.

The company expects consolidated capital expenditure of between $3 billion and $3.2 billion for the current fiscal year that started in April, excluding any potential payment for spectrum, said Mr Sarvjit Singh Dhillon, Group Chief Financial Officer at the mobile operator's parent Bharti Enterprises.

Monthly average revenue per user (ARPU), a key gauge for telecom carriers, fell 3 per cent to Rs 189 compared to Rs 194 last year.

ARPU for its African operations fell 5 per cent to $6.8. Bharti, which in 2010 paid $9 billion to acquire most of the African operations of Kuwait's Zain, has yet to turn a profit in its African segment. But thanks to recent increase in tariffs, the company's Average Rate Per Minute increased by one per cent to 43.8 paisa compared to 43.3 paise in March 2011.

Monthly churn has increased to 8.8 per cent from 7.6 per cent a year ago due to Mobile Number Portability. Non-voice revenue has declined to 14.4 per cent of the overall income from 15 per cent earlier despite the launch of 3G services.


Published on May 02, 2012
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