RCom posts marginal growth, misses estimates

The operator recorded marginal growth in both topline and bottomline despite a 11.6% increase in EBITDA

Reliance Communications, on Friday, posted a 2.8 per cent growth in the third quarter net profit to Rs 108 crore against Rs 105 crore in the same quarter last year. This is due to 23.8 per cent increase in net finance charges to Rs 749 crore.

The total income of the company grow even lesser at 1.9 per cent to Rs 5,403 crore from Rs 5,301 crore in the corresponding quarter last year. Adjusted for other income of Rs 246 crore, it recorded a flat 0.4 per cent growth in revenues. In both topline and botttomline, the results missed analyst estimates who expected as much as Rs 256 crore in net profits and revenues at Rs 5,484 crore.

The company's earnings before interest, tax, depreciation and amortisation (Ebitda) grew by 11.6 per cent at Rs 1,845 crore. “Ebitda margin at 34.2 per cent is amongst the highest in the industry, with strong contribution from India and global businesses,” said the company, in a press release.

The operator also said its revenue per minute or RPM increased by 5.1 per cent to 43.5 paisa. “Voice RPM has increased to 33.5 paisa, up 8.4 per cent. We have significantly improved RPM with tariff hikes and strong focus on paid and profitable minutes,” the company said.

It is to be noted that the company had restated its key performance indicators like RPM and average revenue per user (ARPU) last quarter. It also reported an 11.6 per cent increase in ARPU at Rs 125, even as its minutes of usage went down by 1.8 per cent.

The number of data customers increased by 31.2 per cent to 36.2 million, which includes 11 million 3G subscribers. “The total data traffic up 85.2 per cent. The traffic has increased due to increase in data subscribers and higher data usage per customer,” Reliance Communications said.