Bharti Airtel on Wednesday reported a 41 per cent drop in its consolidated net profit at Rs.1,303.30 crore for third quarter of current fiscal (October-December, 2010), mainly due to heavy spending on its re-branding strategy and foreign exchange losses. However, the telecom major's total revenue for the quarter went up by 51.14 per cent to Rs.15,756 crore.
“Adverse currency movements in India and Africa resulting in restatement losses of Rs.151 crore and the one-time re-branding costs of Rs.340 crore are the main factors that dragged the net income down,” Bharti Group CFO Manik Jhangiani told journalists here. Bharti Airtel re-paid $415 million of its net debt in the third quarter, a major portion of which was towards the repayment of loans for 3G and BWA licence. “Revenue from African operations rose by 8.7 per cent quarter-on-quarter to $911 million. We have completed the integration of the Zain's Africa business,” Bharti Airtel CEO Sanjay Kapoor said. The telecom subscriber base of the company stood at 19.91-crore at the end of December 31, 2010, of which 4.21 crore users were in Africa. The company also registered a higher monthly churn (subscribers leaving and joining the network) rate of 7.8 per cent during the quarter.
Commenting on the mobile number portability (MNP) and how it will impact the company, Mr. Kapoor said: “With what we have seen in Haryana, the number of people going in for MNP is dismal. So, I don't think it will make or break churn.” Bharti Airtel plans to roll out 3G service across the 13 circles where it holds licence by March 31.
