Government-owned telecom operator MTNL continues to post losses. It reported losses of Rs 900.6 crore for the quarter ended March 31, 2018 (Q4FY18). Losses widened from Rs 639 crore in the preceding quarter, and also on a year-on-year (YoY) basis it increased from Rs 639.17 crore in the corresponding quarter last year.
Total income recovered and stood at Rs 660 crore, down 22.5% quarter-on-quarter (QoQ) from Rs 852.6 crore in Q3FY18, and down 31.4% from a total income of Rs 963 crore in Q4FY17. Operating income also followed a downward curve. It stood at Rs 492.3 crore for the quarter, down 15% from Rs 580 crore in the preceding quarter, and significantly down 30% from Rs 705 crore in the same quarter last year.
Basic (Fixed line and Broadband) revenue stood at Rs 440.8 crore, a decline of 15% QoQ from Rs 519.7 crore in Q3FY18. In Q4FY17, this segment had posted revenue of Rs 590 crore. The segment posted losses of Rs 428.4 crore, significantly increasing from losses of Rs 150.98 crore in the preceding quarter, and loss of Rs 296.3 crore in the corresponding quarter last year.
Cellular segment revenue stood at Rs 52.6 crore, down 14.7% from Rs 61.7 crore in the previous quarter, and less than half of the Rs 116.7 core revenue posted in Q4FY17. The losses posted by the segment marginally improved this quarter with Rs 166 crore, as compared to losses of Rs 168 crore in the preceding quarter. However, losses widened on YoY basis, as the segment reported a loss of Rs 140.78 crore in Q4FY17.
MTNL net worth eroded last quarter
Last quarter auditors’ report mentioned that MTNL’s net worth is completely eroded and that the company’s net cash loss during the quarter and period ended December 31, 2017, as well as in the FY2016, the current liabilities exceeded the current assets substantially.” The report also mentioned that the Department of Public Enterprises (DPE) has classified MTNL as ‘Incipient Sick CPSE,’ which has also been confirmed by the Department of Telecommunications.
Back in October 2015, DPE had issued guidelines regarding how to deal with the revival and restructuring of incipient sick Central Public Sector Enterprises (CPE).
Government’s indecision on MTNL
It’s worth noting that the government had earlier considered merging BSNL and MTNL in Lok Sabha in March last year to save the company from a possible shutdown. But later in a Lok Sabha reply in August 2017, Minister of Communications Manoj Sinha said that “there is no proposal for merger of BSNL and MTNL”.
Earlier, in February 2017, the Ministry of Communications had informed the Lok Sabha that MTNL is exploring options to monetize its assets which may contribute to additional revenue.