MTNL Q1 loss widens to Rs 451 cr on staff cost

State-run Mahanagar Telephone Nigam (MTNL) today said its net loss widened to Rs 451 crore for the quarter ended June 30, 2010, weighed down by its excessive staff costs and outgo for 3G spectrum fee.

The company had a net loss of Rs 42 crore for the April- June quarter last year, MTNL said in a statement.

"This (the loss) is due to increased staff cost, provision for retirement benefits and payment of spectrum on amortisation of one time charges of 3G and BWA spectrum to the extent of Rs 157.6 crore during the quarter," it added.

Total income rose to Rs 971 crore in the quarter ended June 30, from Rs 952 crore in the same period previous fiscal.

However, MTNL's total expenditure was much higher than its revenue from operations due to higher staff costs.

The company spent Rs 717 crore as staff costs for retirement benefits during the quarter.

Staff costs and other expenses added up to Rs 1,456 crore, which is much higher than its total revenue.

MTNL with 5 million subscribers, offers services in just two areas — Delhi and Mumbai.

An amount of Rs 182 crore is received by MTNL towards wet lease for the infrastructure to be provided by MTNL in respect of Commonwealth Games and out of this, Rs 60.67 crore is accounted for income proportionately in the first quarter, the company said.

MTNL had made a payment of Rs 6,564 crore for the 3G spectrum and Rs 4533.97 for BWA spectrum.

MTNL scrip closed at Rs 66 on the BSE, up 0.61 per cent from the previous close.