Bharti Airtel Q2 net profit down on forex losses

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Bharti Airtel Q2 net profit down on forex losses

Country's largest telcom service provider Bharti Airtel's net profits slipped marginally to Rs 1,207 crore against Rs. 1215.2 crore (QoQ).

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Moneycontrol Bureau

Country's largest telcom service provider Bharti Airtel's net profits slipped marginally to Rs 1,207 crore against Rs. 1215.2 crore (QoQ). 

This is the seventh straight quarter in which Bharti Airtel has reported a consecutive decline in its net profit due to higher interest outgo and costs related to the roll-out of its 3G network.

However, the company's consolidated revenues in the second quarter rose 1.78% to Rs 17,276 crore against Rs 16,974.9 crore in the April-June quarter of FY12.

Analysts say while revenue growth slowed down mainly due to low traffic growth in Indian wireless market, net profits were hit because of forex losses. Bharti reported a forex loss of Rs 239 crore against Rs 170 crore (QoQ) on account of currency fluctuations.

Commenting on the earrings, chairman Sunil Mittal said, "This year is progressing well for Bharti Airtel businesses. The arrest of continuously declining prices in India augurs well for the telecom industry. We notched up strong revenue growth of 23% money in Zambia and Kenya. We continue to expand our acquisition of a 2G and 3G license in Rwanda."

Meanwhile, the company has reported a 10 basis points rise in earnings before interest, tax, depreciation and amortization (EBITDA) margins to 33.7% versus 33.6% Q-o-Q.

The company in a statement that this is the first full quarter of comparable consolidated results post the Africa acquisition. India and South Asia continued its double digit revenue growth 11.7% Year-on-Year.

"The recent tariff increase in India has begun to take effect, offsetting some of the inflationary and other cost increases impacting the entire industry," said the company in a press release.

Meanwhile, Africa revenues stood at $1,030 million, up 23% Y-o-Y.
Consolidated EBITDA margins have been sustained at 33.7% when compares with the preceding quarter, despite cost pressures.

Shares of the company dipped 0.5% at Rs 391.15 at 9.25: hours on the Bombay Stock Exchange.

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