Bharti Airtel Africa’s loss slashed to $91 million
India’s business mogul, and core investor in Bharti Airtel, Sunnil Bharti Mittal, has hinged the cut from $170m loss last year to $91m on growth in data customers and consumption and currency stabilisation in most markets, except for Nigeria, where the Naira depreciated by 7.9 per cent. Revenue for the continent rose 3.7 per cent to $898 million.
Chief Operating Officer of Africa, Raghunath Mandava, said that underlying Africa revenue growth for the quarter was 4.7 per cent year- on-year, backed by focus on profitable top line growth, led by localised distribution, stronger data networks and the company’s war on waste programme.
In Nigeria, the firm, which is headed by Segun Ogunsanya, currently controls 22 per cent of the market and services over 32 million customers across the country.
The telecommunications firm claimed that its second-quarter net profit fell almost five per cent from a year earlier, as its voice and data businesses came under pressure with the entry of Reliance Jio Infocomm in India, and its interest burden rose. The Indian top telecom company beat market estimates, though, as it controlled costs.
According to ET India, the company posted a net profit of Rs 1,461 crore for the three months ended September, topping the average estimate of about Rs 1,200 crore in an ET poll of analysts. Profit was little changed from Rs 1,462 crore in the April-June quarter.
Revenue climbed 3.4 per cent to Rs 24,652 crore from a year earlier and the telecoms ended the quarter with more than 363 million customers across India, South Asia and Africa, Bharti Airtel said in a statement. In India, which makes up over 77 per cent of overall revenue, the company had almost 260 million mobile subscribers.
“Overall revenue momentum in India has been sustained during Q2 with a growth of 10.1 per cent Y-o-Y. This is primarily due to the strong performance of our non-mobile businesses, which grew in aggregate at 18.8 per cent Y-o-Y, albeit our mobile business has experienced a slowdown in growth due to free services being offered by a new operator,” Managing Director and Chief Executive Officer, India & South Asia, Gopal Vittal, said in the statement.
Bharti Airtel said separately that it plans to sell a “significant” stake in tower unit Bharti Infratel, without giving further details. The company holds almost 72 per cent in the unit. Infratel shares climbed 2.4 per cent to Rs 378.7 at the close on the BSE Tuesday, giving it a market capitalisation of almost Rs 72,000 crore. Airtel shares gained 1.5 per cent to Rs 311.05.
Jio, backed by India’s richest person Mukesh Ambani, started commercial operations on September 5, this year with a free voice and data offer. Incumbents, including Bharti Airtel, were forced to slash effective data rates and even offer free voice calling on some plans. Existing telecoms had started cutting rates even before Jio’s launch, all of which hurt key operational metrics such as average revenue per user (ARPU) and average revenue per minute (ARPM).