Bharti Airtel reported a decline in its third quarter revenue as the battle with Reliance Jio raged on and the impact of lower termination charges kicked in, but the company prevented any massive damage to its bottom line.
Airtel’s top line shrunk by 6.7% on quarter and 13% on year to Rs 20,319 cr for the Oct-Dec quarter, while net profit fell by 4.3% on quarter to Rs 561 cr. In the year-ago period, the net profit was 672 cr.
Much of the damage happened in India. The revenue from mobile services in India fell by 12% on quarter and 22% on year to Rs 10,751 cr — or about half of the company’s total revenue.
Average revenue per user or ARPU fell by 15% in three months to Rs 123 per month per customer from Rs 145 per month in the September quarter.
On the positive side, total data carried by the company in India on its mobile network jumped 41% in three months. It has risen six fold compared to the year-ago period.
Operating profit (EBIT) at India mobile business fell to 167 cr from 1,138 cr three months earlier and Rs 2,303 cr a year earlier.
However, net profit was saved primarily because of a tax write-back as well as a sharp decline in tax expense.
Profit before exceptional items and tax, for example, fell by 35% compared to the previous three months to Rs 838 cr. Compared to the year-ago period, the number was down by almost 60%.
However, net profit was saved from the same kind of damage thanks to lower taxes.
Total tax expense — including current and deferred — fell from around Rs 535 cr in the preceding quarter to just Rs 38 cr. The fall in tax was even sharper when compared to the previous year, when the tax expense was Rs 1,184 cr.