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MTNL Losses Up 68% QoQ To Rs 1,985.9 Cr In Q4-FY13

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State run telecom service provider Mahanagar Telephone Nigam Limited (MTNL) has reported an increase in its operational revenue to Rs 918.6 crore for the quarter ending March 31, 2013, up 10% from Rs 835 crore reported in the previous quarter and up 8.96% from Rs 843.1 crore reported in the same quarter last year.

The telco however saw a significant increase in its losses during the quarter, reporting Rs 1,985.9 crore loss, a 68% increase from Rs 1,182 crore loss in the previous quarter and a 44.48% increase from Rs 1,374.5 crore in the same quarter last year.

Highlights

– In January 2013, MTNL had launched Video Telephony Service on broadband in Delhi and Mumbai. The telco had partnered with the Ahmedabad based ICT solutions provider Sai Infosystem (India) Limited for this service.

– MTNL has 2.3 million active mobile subscribers across Delhi and Mumbai, as of March 2013 and currently has a 0.58% market share in the wireless segment, as per the latest TRAI numbers.

– MTNL has 1.08 million (pdf) broadband subscribers as of March 2013 and has 7.2% market share in the broadband segment, as per the latest TRAI numbers.

– MTNL has 3.46 million (pdf) wireline subscribers as of March 2013 and has 11.45% market share in the wireline segment.

– Last month, Kapil Sibal, the Minister of Communications and Information Technology, had attributed the rising losses to Fixed to Mobile substitution, increasing staff expenditure due to a large legacy work force, stiff competition in the mobile sector, payment towards 3G and BWA spectrum charges and a decrease in the average revenue per user (ARPU). The minister however didn’t disclose any information on the current ARPU of MTNL.

– Sibal had also elaborated on the steps taken to improve the profitability of the telco. These include commissioning Convergent billing which will provide a single bill for all services to a subscriber, reviewing tariffs of existing products and services, rolling out measures to facilitate easy payment of telephone bills and providing an online system for subscribers to book different services and file complaints for landline and mobile services. However, He hadn’t disclosed any specific information on how do they plan to roll out these measures.

Annual Results

On an annual basis, MTNL reported an increase in its operational revenue to Rs 3,428.7 crore for the year ending March 31, 2013 (FY13), up 1.64% from Rs 3,373.3 crore revenues reported in FY12. However, the company also saw a significant increase in its losses, reporting a Rs 5,321.1 crore crore loss for the year FY13, up 29.47% from Rs 4,109.8 crore loss in FY12.

Segment Revenues

– Revenues from Basic services increased marginally to Rs 2,696.1 crore for the year ended FY13, up 1.04% from Rs 2,668.3 crore in FY12. The segment reported a loss before tax of Rs 3,136.8 crore for FY13, up 39.22% from Rs 2,253.2 crore in FY12. MTNL offers basic landline and broadband services in the two cities of Delhi and Mumbai and its major share of revenue comes from basic services. Revenues from Basic services accounted for 78.63% of MTNL’s total operational revenues for FY13.

– Revenues from Cellular services increased to Rs 759.3 crore for FY13, up 3.87% from Rs 731 crore in FY12. The segment reported a loss of Rs 479.7 crore for FY13, a 22.59% decline from Rs 619.7 crore loss before tax in FY12. MTNL offers cellular services in Delhi and Mumbai and revenues from cellular services accounted for 22.15% of MTNL’s operational revenues for FY13.

MTNL hasn’t provided any segment revenues for the quarter, however in the previous quarter (Q3-FY13), MTNL’s basic services had reported Rs 668.91 crore revenue and Rs 610.86 crore loss, while its cellular services had reported Rs 172.99 crore revenue and Rs 186.95 crore loss.

Download: Financials

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