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Ortel lost over 8% of its broadband users due to demonetization & competition

Multi system operator Ortel Communications reported broadband revenues of Rs 8.7 crore for the quarter ended December 2017 (Q3 FY17). This was up 5% from Rs 8.3 crore in the same quarter last year and down from Rs 10 crore in the preceding quarter. The company mentions that demonetization and increased competitive situation impacted its subscriber growth.

Total broadband subscribers stood at 72,503 at the end of the quarter, down 8.5% from 79,182 subscribers in the previous quarter. Broadband users accounted for 9% of Ortel’s subscribers. This number was 10% in the preceding quarter. Broadband ARPU, which had been steadily increasing over the quarters, declined to Rs 394 in Q3FY17, down from Rs 406 in the previous quarter, and from Rs 396 in the same quarter last year.

Data usage per customer increased to 5,415 MB from 4,562 MB in the preceding quarter.

Quarterly financials

Ortel reported a net loss of Rs 2.8 crore for the quarter compared to a profit of Rs 3.9 crore in the same quarter last year. On a sequential basis, net profit decreased from Rs 2.5 crore.

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– Total revenues increased by 3% to Rs 51.8 crore, with gross margins for Cable and Broadband segments at 74% each.

– EBITDA stood at Rs 11.8 crore down 36.9% from Rs 18.7 in the same quarter last year.

– EBITDA margin stood at 22.8%.

– In Q2, the company’s cable TV revenue grew 25% YoY to Rs 40 crore from Rs 32 crore.

Other developments

– In September, Ortel , which had started public WiFi hotspots in January, said that it has  30,000 people accessing internet from these.

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– In October last year, ErosNow tied up with Ortel to offer a subscription based movie streaming service called Ortel Broadband Movies.

– In March 2015, Ortel’s Initial Public Offering (IPO), failed to gain full subscription. Of the 12 million shares issued, about 9.68 million, or around 81%, was subscribed to. Ortel had previously mentioned that it was looking to raise Rs 217.2 – 240 crore through the public issue offering.

Download: Presentation and press release

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