RCom Q4 net doubles on tax adjustment

Reliance Communications (RCom) nearly doubled its net profit to Rs 332 crore in the fourth quarter ended March 31 from Rs 168 crore in the year-ago period, due to a Rs 119-crore tax adjustment.

Revenue, however, was down 33 per cent to Rs 5,010 crore from Rs 7,475 crore. Net income from operations include a one-time adjustment of Rs 2,545 crore consequent to a change of accounting treatment in respect of what it called “indefeasible rights of use”. The management was not available for more clarity on the issue.

The depreciation and amortisation dropped by 72.6 per cent to Rs 970 crore from Rs 3,550 crore in the year-ago period. RCom said its subsidiary Reliance Infratel was granted an approval by the Ministry of Corporate Affairs to provide depreciation in its stand-alone accounts on telecom towers at 2.72 per cent under straight line method over the useful life of asset.

“As a result, depreciation charge in consolidated accounts for the year ended March 2012 was lower by Rs 173 crore and profit was higher by the said amount,” RCom said.

The company's revenue per minute (RPM) for the quarter stood at 43.6 paisa. “We have successfully achieved RPM stability for the last eight consecutive quarters amidst increasing competition and over supply of minutes in market place. Our total RPM drop over last eight quarters had been one per cent versus significantly higher drop in the industry,” the company said. It posted an Ebidta margin of 30.7 per cent for the quarter.