Bharti Airtel is India's largest mobile operator with 22.4% of the total market. It reported its December results last week, which, as it has a March year end, are for a nine month period. The figures show a marked improvement in every respect - the customer base has risen considerably, revenues, EBITDA are net income are all well ahead, return on capital has improved and gearing is down.
Taking the customer base first, Bharti added just under 5m customers in the quarter, to take its total from 27.1m to 32.0m. This is 96% more than it had at the same stage in its 2006 fiscal year, when its total was just 16.3m. This spectacular growth has made it one of the 20 largest operators in the world. Quite where it stands on this list will not be determined until the rest of the industry has reported, but it was the 17th largest company at the end of September, up from 34th one year earlier. Its current total of 32m, had it been reported three months earlier, would have put it in eleventh place.
Despite the near doubling of its base over the year, the main operational metrics have not been hugely diluted. Minutes of use are, in fact, well ahead at 467 compared with 411 in the December 2005 quarter and 451 in the prior period. This has helped ARPU stay within ten percent of the prior year's Rp 470, at Rp 427. Within this, non-voice usage has risen from 9.7% of service revenues to 10.4%. Finally, churn has improved significantly. Prepaid churn is down from 5.5% to 4.8%, while contract churn has fallen from 4.2% to 3.5%. Bharti divides this latter into voluntary and company initiated churn, and gratifyingly, both are down, in the first instance from 1.4% to 1.2% and in the latter, from 2.8% to 2.3%.
These much improved operating results have enabled Bharti to produce a very strong set of financial results. Overall group revenues in the third quarter rose from Rp30.26bn to Rp49.13bn, an increase of 62%, while EBITDA increased by 79% to Rp20.06bn (Rp11.20bn). Strong cash generation has reduced financial expenses and as a result, profits before tax are up a massive 126%, at Rp14.41bn. The figures for the nine months are nearly as striking: revenue is up 59% at Rp131.26bn, EBITDA is up 69% at Rp52.10bn, while the pre-tax figure is 86% up, at Rp33.79bn. The mobile business contributed the largest part of these revenues and indeed, the largest part of the improvement. Third quarter mobile revenues totalled Rp37.58bn, up 73%, while mobile EBITDA is 78% ahead, at Rp14.13bn.
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Posted to the site on 31st January 2007
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