mts

After registering a decline in its data card subscriber base for three consecutive quarters, Sistema Shyam Teleservices (SSTL) which operates in India as MTS India, has finally seen some growth – 1.21 million subscribers for the quarter ended September 30, 2013, up 4.5% from 1.16 million subscribers in the previous quarter.

Non-voice revenues which includes data and VAS revenues declined quarter-on-quarter (QoQ) to Rs 97.9 crore, down 2.2% from Rs 100.1 crore in the previous quarter. However its contribution to MTS India’s total quarterly revenues increased marginally to 34.5% for the quarter, up from 34.4% in the previous quarter.

Highlights

Blended mobile ARPU increased by 6.8% to Rs 95 for the quarter, up from Rs 89 in the previous quarter, due to increase in usage minutes following improved quality of customer base.

Minutes of Use increased to 363 million minutes for the quarter, up 11% from 328 million minutes reported in the previous quarter.

– SSTL’s total mobile subscriber base declined marginally to 9.6 million subscribers for the quarter, down 1.8% from 9.8 million subscribers in the previous quarter. Sistema is currently operational in 9 of the 22 telecom circles in India, after shutting down its operations in 10 telecom circles in February 2013 and pulling the plug in additional three circles in the following month. The operational circles include the eight circles where it secured spectrum in the March spectrum auctions and Rajasthan circle which was unaffected by the Supreme Court judgment last year.

– During the quarter, Sistema received unified licenses for eight circles it had won in the March 2013 auctions, thereby becoming the first telco to receive unified license in the country, which will enable them to offer any form of communication (telephone, Internet, broadband and others) through a single license for 20 years.

– MTS India commercially rolled out its 3GPLUS Evolution-Data Optimized (EV-DO) Rev B Phase II network which claims to offer download speeds of up to 9.8 Mbps.Coinciding with this launch, the telco also debuted the next-gen MBlaze Ultra dongle in all nine operational circles. It also plans to launch a series of smartphones which will utilize the 3GPLUS network, by the end of 2013.

– It partnered Shemaroo Entertainment to launch a devotional service ‘iDivine‘ as a value added service for MTS MBlaze subscribers.

– Launched an online shop which allows customers to buy MTS CDMA smartphones and data cards.

– SSTL’s high speed data services is now available in 500 towns across nine circles.

Discussing the results, SSTL CEO Dmitry Shukov welcomed the Indian Government’s move to allow 100% FDI in telecom, although he noted that the government should also provide a clear roadmap for the 800 MHz spectrum auctions. “This is a must for proliferation of data services amongst the masses and also for restoring investor confidence”.

He also mentioned that they continue to focus on optimizing its business in line with its medium term target to turn OIBDA (Operating Income Before Depreciation and Amortization) positive by the end of 2014.

Financials

– Consolidated Revenues declined 2.2% quarter-on-quarter (QoQ) to Rs 284.4 crore, down from Rs 290.2 crore in the previous quarter, due to reduced operating footprint. The revenues in nine operational circles however remained flat QoQ.

– Net loss declined 10% QoQ to Rs 760 crore for the quarter, from Rs 844.7 crore in the previous quarter, but up 53% year-on-year from Rs 495.4 crore loss in the same quarter last year.

– SSTL made investments of Rs 40.4 crore during the quarter while the debt from banks and financial institutions at the end of March 31, 2013 stood at Rs 3,897 crore.

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