Idea Cellular posts 57.4 per cent rise in consolidated net profit

Idea Cellular, India's third-largest telecom operator by subscribers, has posted a 57.4 per cent rise in net profit at Rs728.2 crore on a consolidated basis for the first quarter ended 30 June. On a comparative basis, the GSM operator recorded a net profit of Rs 462.7 crore during the same quarter a year ago.

The rise in net profit, which was much above analysts' expectations, was due to a balanced growth on rise in voice minutes and Average Realisation per Minute (ARPM). The street expected the company, in which Malaysia's Axiata hold a one-fifth stake, to report net profit of Rs 650 crore.

During the reporting quarter, the Aditya Birla group company posted revenue of Rs7,561 crore, an increase from Rs6,538 crore reported in the year-ago quarter. Its EBITDA (operating profits) rose 33.2 per cent to Rs2,510.6 crore.

On a standalone basis, the telecom operator more than doubled its net profit to Rs1,011.7 crore from Rs482.9 crore, while total revenues rose 15.62 per cent to Rs7,556.2 crore (Rs6,535.5 crore).

The standalone net profit included a Rs362.3 crore dividend it received from Indus Towers – a three-way joint venture between Bharti Airtel, Vodafone India and Idea Cellular - which helped the company deliver the highest-ever standalone net profit.

''This quarter Idea delivered balanced growth with sequential quarterly voice minutes expansion by 5.2 per cent and improvement of 3.3 per cent,'' the company said in a statement.

The higher voice rate realisation and jump in data contribution to 11.5 per cent of service revenue helped improve ARPMs by 1.5 paise from 43.6 paise in the fourth quarter to 45.1 paise in first quarter of FY15. The Value Added Services (VAS) contribution has improved sharply to 17.8 per cent of overall service revenue, it added.

Idea Cellular's standalone EBITDA at Rs 2,266.4 crore grew faster by 14 per cent on a quarter-on-quarter basis due to multiple drivers including scale benefit, better cost management and robust voice and data growth. The EBITDA margin has improved sequentially by 1.8 per cent to 30 per cent, it said.

This quarter, Idea reversed the falling average realisation per MB (ARMB) data rate trend by improvement of 1 paisa to 26.3 paise (vs 25.3 paise in Q4FY14).

The explosive mobile data volume growth and ARMB improvement has helped the company deliver 23.6 per cent mobile data revenue growth. The net mobile data consumer base has risen in the quarter by 2.6 million to 27.9 million.

Idea Cellular has pared its net debt by Rs5,208.7 crore to Rs13,976.9 crore as of June-end. This follows a Rs3,000-crore QIP and an additional cash of Rs2,023 crore from operations. The company's net debt to annualised EBITDA ratio now stands at 1.54, providing the company sufficient headroom to participate in the forthcoming spectrum auction.