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Spice Mobility’s mobile devices business reports losses of Rs 6.42Cr in Q2FY18

Spice Mobility’s devices business continues to post losses, and in this quarter it recorded a significant jump: the segment reported a net loss before tax of Rs 6.52 crore for the quarter ended September 30, 2017, compared to a loss before tax of Rs 2.73 crore in the previous quarter, and a loss of Rs 4.77 crore in the same quarter last year.

Note that on May 19 this year, the company’s board had decided to discontinue its ‘Spice’ branded handsets business, and this discontinued segment posted losses of Rs 2.15 crore for the quarter, as opposed to losses of Rs 2.57 crore in the previous quarter.

Total revenues from the mobile devices segment stood at Rs 106.48 crore, down from Rs 124.85 crore in the previous quarter and Rs 162.39 crore in the same quarter last year. The segment accounted for 60.01% of Spice Mobility’s total revenues, which stood at Rs 177.44 crore for the quarter.

Services business

Revenues from Spice Mobility’s services business stood at Rs 69.74 for the quarter, up marginally from revenues of Rs 69.15 crore in the previous quarter, and up from revenues of Rs 63.34 crore in the same quarter last year. The segment accounted for 39.31% of Spice Mobility’s total revenues.

The segment posted a profit of Rs 50.37 lakh, as compared to losses of Rs 1.81 crore in the previous quarter. However, it was down significantly from the profit of Rs 3.04 crore posted in the corresponding quarter last year.

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Overall, Spice Mobility posted revenues of Rs 177.44 crore for the quarter, and losses (after tax) of Rs 11.62 crore.

Spice Digital stake

In September, Spice Mobility’s Board Finance Committee decided to acquire an additional 10.78% stake in its subsidiary, Spice Digital Limited. Following this, Spice Mobility’s stake in Spice Digital went up from 89.19% to 99.97%. The value of the deal was Rs 34.56 crore, which Spice Mobility paid in cash.

The timing of this additional stake acquisition was interesting, because a month before that Spice Digital had got the final Certificate of Authorization (COA) from the Reserve Bank of India (RBI) to set-up as an operating unit under the Bharat Bill Payment System. It had received an in-principle approval from the RBI back in May 2016. It joined other non-bank entities such as Oxigen, PayU, TechProcess Payment Services, Euronet and Paytm to set up a Bharat Bill Payment Operating Unit (BBPOU).

Download: Financials

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