Idea Cellular announces unaudited results for the second quarter (Q2) and half year ended 30 September 2014
20 October, 2014
Share| Highlights – Q2 FY15 | |||
| Idea – Standalone1 | Revenue Rs. 75,673mn | EBITDA Rs. 22,394mn | PAT Rs. 7,794mn |
| Idea – Consolidated2 | Revenue Rs. 75,699mn | EBITDA Rs. 24,907mn | PAT Rs. 7,559mn |
| INR mn | ||||||||
| Idea standalone1 | Idea consolidated2 | |||||||
| Q2 FY15 | Q1FY15 | H1 FY15 | H1FY14 | Q2 FY15 | Q1FY15 | H1 FY15 | H1FY14 | |
| Revenue - Established Service Areas3 | 71,437 | 71,547 | 1,42,984 | 1,21,818 | ||||
| Revenue - New Service Areas4 | 4,236 | 4,015 | 8,252 | 6,707 | ||||
| Total revenue | 75,673 | 75,562 | 1,51,236 | 1,28,525 | 75,699 | 75,610 | 1,51,309 | 1,28,620 |
| EBITDA - Established Service Areas3 | 24,192 | 24,325 | 48,517 | 38,119 | ||||
| EBITDA - New Service Areas4 | (1,798) | (1,729) | (3,527) | (2,616) | ||||
| Total EBITDA | 22,394 | 22,596 | 44,990 | 35,503 | 24,907 | 25,038 | 49,945 | 40,115 |
| EBITDA % - Established Service Areas3 | 33.9% | 34.0% | 33.9% | 31.3% | ||||
| EBITDA% - New Service Areas4 | -42.4% | -43.1% | -42.7% | -39.0% | ||||
| Total EBITDA% | 29.6% | 29.9% | 29.7% | 27.6% | 32.9% | 33.1% | 33.0% | 31.2% |
| Depreciation &; Amortisation | 10,774 | 10,586 | 21,360 | 20,218 | 11,788 | 11,545 | 23,333 | 22,148 |
| EBIT | 11,621 | 12,010 | 23,631 | 15,285 | 13,119 | 13,493 | 26,612 | 17,967 |
| Interest and Financing Cost (Net) | 1,176 | 2,005 | 3,181 | 3,043 | 1,445 | 2,275 | 3,720 | 3,796 |
| Dividend from Indus | 1,026 | 3,623 | 4,648 | 838 | - | - | - | |
| PBT | 11,470 | 13,628 | 25,098 | 13,080 | 11,674 | 11,219 | 22,893 | 14,171 |
| PAT | 7,794 | 10,117 | 17,911 | 8,813 | 7,559 | 7,282 | 14,841 | 9,103 |
| Cash Profit5 | 18,155 | 20,230 | 38,385 | 31,994 | 18,971 | 18,372 | 37,343 | 34,429 |
| Note: Forex loss/gain which was part of net interest and finance cost earlier, has been regrouped to other expenditure (impacting the EBITDA). Past period figures are restated. | ||||||||
Idea Cellular, is pleased to reverse the last two years' trend of sequential revenue decline during the seasonally weak ‘July to September’ quarter due to contraction in ‘Voice Minutes of Use’, with an absolute revenue growth of Rs.111 million. Idea standalone Q2FY15 revenue at Rs.75,673 million has robust YoY growth @ 19.8 per cent on back of 17 per cent annual increase in voice MoUs and 125.9 per cent growth in ‘Mobile Data Volume’.
During this quarter, the company carried 162.5 billion minutes on its network, less pronounced seasonal quarterly decline of 1.7 per cent, in comparison to 5.8 per cent minute decline in Q2 vs Q1FY14. In line with the emerging digital connectivity demand, mobile data volume exploded to 39.4 billion MB on its 2G+3G platform @ 21.3 per cent QoQ growth, reaffirming consumer preference for brand Idea.
While the voice rate realisation was under pressure, but 22.5 per cent quarterly jump in mobile data revenue, contributing 14.0 per cent to service revenue, helped Idea improve ‘Average Realisation per Minute’ (ARPM) by 0.8paisa from 45.1p in Q1FY15 to 45.9p in Q2FY15. The ‘Value Added Service‘ (VAS) contribution has improved sharply to 21.1 per cent of service revenue, a gain of 4.9 per cent over last one year.
The standalone EBITDA of Rs.22,394 million grew by 29.5 per cent on YoY basis due to multiple drivers including scale benefit, better cost management and robust net subscriber addition, voice minutes and data volume growth. Idea improved its EBITDA margin by 2.2 per cent during last one year to 29.6 per cent.
Including Indus dividend receipt of Rs.1,026 million, the company has delivered excellent ‘Profit After Tax’ (PAT) at Rs.7,794 million, nearly double the Q2FY14 PAT of Rs.3,984 million.
Brand Idea continues its high subscriber growth momentum with 4.6 million net new customer additions in the quarter, now servicing 143.6 million EoP customer base as ‘Average Revenue Per User’ (ARPU) improved to Rs.176 (Rs.164 in Q2FY14) and MoU/Subscriber increased to 384 minutes (368 minutes in Q2FY14). The company continued its journey of strengthening its competitive market standing with VLR subscriber market share climbing to 17.8 per cent (August 2014) and Revenue Market Share (RMS) in Q1FY15 @ 17.1 per cent, an increase of 0.9 per cent compared to Q1FY14.
Idea managed to maintain the mobile data ‘Average Realisation per MB’ (ARMB) at 26.5paisa (vs 26.3p in Q1FY15). The explosive mobile data volume growth and steady ARMB has helped mobile data quarterly revenue cross Rs.10 billion mark. The mobile data consumer base has risen in this quarter by 3.1 million to 30.9 million. The blended data ARPU (2G+3G) has also improved to Rs.119 and ‘Usage per data subscriber’ is now at 447 MB. The 3G (Voice+Data) customer grew steadily to 13.3 million but still represents only 9.3 per cent of Idea's total subscriber base. In comparison, the 3G phone penetration among Idea subscribers is improving and over 17 per cent of Idea users own high speed 3G devices.
In July 2014, the company allotted 51.84 million equity shares at an issue price of Rs.144.68 per equity share (including a premium of Rs.134.68 per equity share), aggregating to approximately Rs.7,500 million, on preferential basis to its telecom partner — Axiata Investments 2 (India) Limited, an affiliate of Axiata Group. With additional equity infusion and strong cash profit of Rs.18,155 million in the quarter, Idea has reduced its net debt by Rs.21,500 million to Rs.118,269 million. The net debt to annualised EBITDA ratio stands at 1.32, providing the company sufficient headroom to participate in the forthcoming 900 MHz spectrum renewal auction.
For Q2FY15, on consolidated basis including Indus 16 per cent contribution, Idea revenue grew by 19.7 per cent against same quarter year ago and YoY EBITDA rose by 27.2 per cent, driving the EBITDA margin to 32.9 per cent. The consolidated PAT at Rs.7,559 million has grown sharply by 68.9 per cent from Rs.4,476 million in Q2FY14.
The strong consumer demand and brand association, expanding 2G and 3G network footprint, competitive spectrum portfolio with steady cash flows from operations affirms Idea ability to deliver consistent, competitive, responsible and profitable growth. The company is well geared to meet all volatile, uncertain, complex and ambiguous developments and remains on course of its mission to improve its market standing both in mobile voice and data business.
Notes:
- Idea standalone represents Idea, and its 100 per cent subsidiaries. Effectively, this encompasses all operations, excluding the joint venture i.e. Indus.
- Idea consolidated represents Idea standalone and proportionate consolidation of Indus (@16 per cent).
- Established Service Areas represent 15 service areas namely Maharashtra and Goa, Gujarat, Andhra Pradesh, Madhya Pradesh and Chhattisgarh, Delhi, Kerala, Haryana, Uttar Pradesh West and Uttaranchal, Uttar Pradesh East, Rajasthan, Himachal Pradesh, Punjab, Karnataka, Mumbai and Bihar service areas.
- New Service Areas represent seven service areas of Orissa, Tamil Nadu, J&;K, Kolkata, West Bengal, Assam and North East.
- Cash profit is calculated assummation of PAT, Depreciation and Amortisation, charge on account of ESOPs and deferred tax, for the relevant period.
- Figures for past periods have been regrouped, wherever necessary.
About Idea Cellular Ltd
Idea Cellular is the third largest wireless operator in India with a revenue market share of 17.1 per cent (Q1FY15). Idea is listed on the National Stock Exchange (NSE), and the Bombay Stock Exchange (BSE) in India. Idea is part of the Aditya Birla Group, which is one of the largest business groups in India. The Aditya Birla Group is a conglomerate with operations in more than 30 countries. The Aditya Birla group has a history of over 50 years and has businesses in, among others, mobile telecommunications, metals and mining, cement, carbon black, textiles, garments, chemicals, fertilizers, life insurance and financial services industries.
