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Idea Cellular announces un-audited results for the third quarter (Q3) and nine months ended December 31, 2013

27th January, 2014

Highlights - Q3 FY14

Idea - Standalone 1 Revenue Rs. 66,105mn EBITDA Rs. 18,135mn PAT Rs. 3,981mn




Idea - Consolidated 2 Revenue Rs. 66,131mn EBITDA Rs. 20,557mn PAT Rs. 4,677mn





INR mn
 
Idea standalone1
Idea consolidated 2

Q3 FY14
Q2FY14
YTD Q3 FY14
YTD Q3 FY13
Q3 FY14
Q2FY14
YTD Q3 FY14
YTD Q3 FY13
Revenues - Established Services Areas 3
62,779
59,853
184,597
145,187
       
Revenues - New Services Areas 4
3,326
3,317
10,033
19,810
       
Total revenue
66,105
63,170
194,630
164,997
66,131
63,233
194,751 163,962
EBITDA - Established Services Areas 3
19,716
18,689
58,155
43,919
       
EBITDA - new services areas 4
(1,581)
(1,259)
(4,154)
(5,241)        
Total EBITDA
18,135
17,430
54,001
38,677
20,557
19,715
61,035 43,315
EBITDA % - Established Service Areas3 31.4% 31.2% 31.5% 30.2%        
EBITDA% - New Service Areas 4
-47.5%
-37.9%
-41.4%
-26.5%        
Total EBITDA%
27.4%
27.6%
27.7%
23.4%
31.1%
31.2%
31.3% 26.4%
Depreciation & Amortisation
10,671
9,811
30,888
23,757
11,666
10,795
33,814 25,686
EBIT
7,465
7,619
23,113
14,921
8,891
8,920
27,221 17,629
Interest and Financing Cost (Net)
1,213
1,575
4,621
6,257
1,575
1,949
5,735 7,250
Dividend from Indus
-
-
838
1,543
-
-
- -
PBT
6,251
6,044
19,331
10,206
7,316
6,971
21,486
10,379
PAT 3,981 3,984 12,794 7,411 4,677 4,476 13,780 7,028
Cash profit 5
15,663
14,555
47,656
33,901
17,435
16,164
51,864 35,521
Note: Mumbai and Bihar service areas have been included in Established Service Areas from Q1FY14, previous quarters figures have not been restated.

Mumbai: Continuing with its long term trajectory of expanding market share, Idea Q3FY14 standalone revenue grew by 17.8 per cent from Rs. 56,135 million (Q3FY13) to Rs.66,105 million (Q3FY14) on back of 9.4 per cent annual growth in 'Total Minutes of Use' and 107.6 per cent in data volume.

Consumer preference for brand Idea continues to rise as company added 18 million incremental subscribers (on VLR) in calendar year 2013, now serving 129 million subscribers. Idea supported its consumer centricity vision by launching highest ever 18,297 new sites (2G+3G) during calendar year 2013 expanding Idea presence to over 3,44,000 towns and villages. The company maintains its enviable five years track record of 'fastest growing Indian mobile operator' with 'VLR Subscriber Market Share' @ 16.7 per cent and 'Revenue Market Share' @ 15.8 per cent in Q2FY14, an improvement of over 1 per cent in last one year. The quality of Idea subscribers improved as ARPU increased to Rs.169 (v/s Rs. 158 in Q3FY13) and subscriber churn fell by 1.2 per cent to 5.6 per cent (v/s Q3FY13).

Inspite of higher network expansion and inflationary pressures, Idea continued its record of sharp Y-o-Y EBITDA growth @ 37.7 per cent. During 2013, the company improved its EBITDA margin by 4.0 per cent to 27.4 per cent mainly on the strength of improved rate realisation (ARPM), cost optimisation and scale benefits.

The 'Value Added Services' (VAS) contribution increased to 16.1 per cent of 'Service Revenue' (14.6 per cent in Q3FY13), despite steep decline in 'Non Data VAS' service contribution from 8.9 per cent (Q3FY13) to 6.6 per cent in Q3FY14. The higher 'Mobile Data' adoption has primarily led to VAS growth with data revenue as per cent of 'Service Revenue' improving by 3.8 per cent to 9.5 per cent in last one year.

From this quarter, the company eliminated incidental data users reporting; thereby overall mobile data users base has fallen to 25.5 million (2G+3G), but the mobile data ARPU has improved to Rs.91 in Q3FY14 (v/s Rs.52 in Q3FY13). The blended mobile data usage per user grew to 309 MB (2G+3G) as total data volume exploded @ 107.6 per cent to 20.8 bn MB in Q3FY14 (v/s 10.0 bn MB in FY13). However, with a grim battle for data supremacy, the 'Average Realised Rate per MB' (ARMB) fell sharply by 1.3 paisa from 31.0p/MB (Q3FY13) to 29.6p/MB (Q3FY14).

The company added 4.6 million new 3G users during 2013 with 3G EoP user base (Voice and/ Data) now at 8.7 million. The 3G user mobile data ARPU is steady at Rs.112 per month.

The double bottom line drivers of Voice and Data business helped Idea more than double its 'Profit After Tax' (PAT) from Rs.1,911 million in Q3FY13 to Rs.3,981 million in Q3FY14. The Cash Profit for the company remained healthy at Rs.15,663 million a growth of 41.3 per cent over Q3FY13, helping reduce net debt by Rs.27,364 million during 2013 to Rs.89,458 million.

At consolidated level, including Indus 16 per cent contribution, Idea revenue has grown by 18.5 per cent on Y-o-Y basis and Consolidated EBITDA by 39.5 per cent. The Consolidated EBITDA margin on Y-o-Y basis has improved by 4.7 per cent to 31.1 per cent in Q3FY14. The Consolidated Idea PAT at Rs.4,677 million, including Rs.696 million Indus contribution grew by 104.6 per cent compared to Q3FY13 PAT at Rs.2,286 million.

The growing consumer demand and brand affinity, expanding infrastructure and strong cash flows of Idea reaffirms company ability to remain on course with its stated mission of consistent, competitive, responsible and profitable growth and meet all volatile, uncertain, complex and ambiguous developments, as it consolidates its market standing both in mobile voice and data market.

Notes:

  1. Idea Standalone represents Idea, and its 100 per cent subsidiaries. Effectively, this encompasses all operations, excluding the Joint Venture i.e. Indus.
  2. Idea Consolidated represents Idea Standalone and proportionate consolidation of Indus (@16 per cent).
  3. 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 as well as Mumbai and Bihar service areas from Q1FY14 onwards. For FY13 Established Service Areas were 13, not including Mumbai and Bihar
  4. New Service Areas represent seven service areas of Orissa, Tamil Nadu, J&K, Kolkata, West Bengal, Assam and North East from Q1FY14 onwards. For FY13 New Service Areas were nine, including Mumbai and Bihar.
  5. Cash Profit is calculated as summation of PAT, Depreciation and Amortisation, charge on account of ESOPs and Deferred tax, for the relevant period.
  6. Figures for past periods have been regrouped, wherever necessary.

About Idea Cellular Limited
Idea Cellular is the third largest wireless operator in India with a Revenue Market Share of 15.8 per cent (Q2FY14). 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, India's first truly multinational group. The group operates in more than 30 countries, is anchored by an extraordinary force of over 1,36,000 employees belonging to 42 nationalities, and derives over 50 per cent of its revenues from operations outside India.