Bharti Q2 profit shrinks 38%

Dylan Bushell-Embling
07 Nov 2011
00:00

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India's Bharti Airtel said its Q2 profit slumped 38% in the seventh straight quarterly decline, with earnings for the period hit by surging costs and forex losses.

 

The operator, India's largest by subscribers, reported a profit for the quarter of $225 million.

 

Revenue grew 13.4% year-on-year to $3.78 billion, during the first directly comparative quarter since Airtel acquired Zain's African assets for $11.7 billion last year.

 

Revenue from Africa grew 22.9% year-on-year, while India and South Asia revenue increased by 11.7% as the operator's recent tariff hike helped offset the margin and inflationary pressures in the cutthroat Indian market.

 

But costs incurred during the operator's 3G rollout - including higher amortisation costs of $36 million and increased interest costs – and forex losses dragged down the operator's bottom line.

 

Despite the profit impact, Airtel chairman Sunil Mittal said the year “has been progressing well,” adding that “the arrest of continually declining prices in India augurs well for the telecom industry.”

 

Airtel and six other major operators could meanwhile be on the hook for fines from the Department of Telecom, due to a dispute over rollouts in rural areas.

The ministry has accused Airtel, RCom, Vodafone India, Aircel, Tata Teleservices, Idea Cellular and state-owned BSNL of failing to meet their rollout obligations in a subsidized rural mobile infrastructure scheme, Economic Timessaid

Source: 

telecomasia.net

Dylan Bushell-Embling

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