Vodafone Idea, the country’s largest telecom operator by users, has posted a consolidated net loss of Rs 5,004.6 crore on total revenue of Rs 11,760 crore in the third quarter ended December 31, 2018.
The total revenue, which fell 2.2 per cent on a quarter-on-quarter basis, was at a lower rate of decline compared with the previous second quarter. This was due to “good progress” on strategic actions, the company said in a statement.
The December quarter is the first full quarter results reported by company post the merger of Vodafone India and Idea Cellular in August 2018. Hence, previous financial year’s third quarter numbers are not comparable.
“We are progressing well on our stated strategy. The initiatives taken during the quarter started showing encouraging trends by the end of the quarter. We are moving faster than expected on integration, specifically on the network front, and we are well on track to deliver our synergy targets,” Balesh Sharma, Vodafone Idea CEO said.
The introduction of ‘service validity vouchers’ and other commercial initiatives resulted in a turnaround in revenue trends during the quarter. This was reflected in a month-on-month increase in daily revenues in December 2018, and the trend continued in January.
These actions also led to higher churn of ‘incoming only’ or ‘minimal ARPU’ customers and reduced the total subscriber base to 387.2 million (versus 422.3 million in Q2FY19).
The company’s EBITDA rose 16.3 per cent on a QoQ basis to Rs 1,140 crore, driven by the reduction in operating expenses. The third quarter operating expenses (excluding licence fee, spectrum usage charges and roaming and access charges) fell by Rs 750 crore (annualized Rs 3,000 crore) compared to pro-forma operating expenses in first quarter (the period prior to the merger).
Vodafone Idea added 9.5 million 4G customers during the year, taking its total to 75.3 million.
“We remain focused on fortifying our position in key districts by expanding the coverage and capacity of our 4G network, and target a higher share of new 4G customers, while offering an enhanced network experience to our customers. The proceeds from the announced capital raise will put us in a strong position to achieve our strategic goals,” he added.
INTEGRATION
Vodafone India said the pricing plans of both brands (Vodafone and Idea) for pre-paid and post-paid offerings have been harmonised. Integration of the distribution channels, retail footprint and customer service operations are expected to be completed shortly.
The company had given a guidance of Rs 8,400 crore of run-rate costs synergies to be achieved during FY21, two years ahead of the initial target.