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Hathway Cable & Datacom Q3 EBITDA up 46% QoQ on back of activation revenue

MUMBAI: Aided by strong activation revenue, Hathway Cable & Datacom’s fiscal third quarter operating profit at the standalone level grew 46% to Rs 49.8 crore (Rs 498 million) from Rs 34.2 crore (Rs 342 million) a quarter ago.

However, EBITDA sans activation revenue was down 7% to Rs 27.6 crore (Rs 276 million) from Rs 29.5 crore (Rs 295 million) in the earlier quarter.

As per management estimates, quarterly EBITDA inclusive of Hathway’s economic interest in the EBITDA of its several subsidiaries, joint ventures and associate companies would aggregate to about Rs 83.17 crore (net off licence fee).

Net loss narrowed to Rs 32.58 crore (Rs 325.8 million) from Rs 48.94 crore (Rs 489.4 million) in the prior quarter.

Carriage revenue falls 3% QoQ

Standalone total revenue at Rs 300.4 crore (Rs 3 billion) was up 10% from Rs 274.03 crore (Rs 2.74 billion) in the preceding quarter. But without activation, it was up 3% at Rs 278.2 crore (Rs 2.78 billion).

Activation revenue grew to Rs 22.3 crore from Rs 4.7 crore (Rs 47 million) in Q2.

Placement revenue at the standalone level fell 3% to Rs 82.2 crore (Rs 822 million) in the third quarter from Rs 84.8 crore (Rs 848 million) in the trailing quarter.

hathway STANDALONE FINANCIAL RESULTS FOR Q3 FY16 results 12 feb

Subscription revenue from cable TV operations stood almost flat at Rs 108 crore (Rs 1.08 billion) from Rs 107.5 crore (Rs 1.08 billion) a quarter ago.

Broadband subscription revenue in the third quarter was at Rs 78.7 crore (Rs 787 million), up 9% from Rs 71.9 crore (Rs 719 million) a quarter ago.

hathway standalone subscription and arpu trend results1 12 feb

Pay channel cost up 8.3% QoQ

Total expenditure stood at Rs 250.62 crore (Rs 2.51 billion), up from Rs 239.88 (Rs 2.4 billion) a quarter ago.

Pay channel cost in the third quarter was up 8.3% to Rs 106.44 crore (Rs 1.06 billion) compared to Rs 98.27 crore (Rs 982.7 million) in the earlier quarter.

STB deployment

Hathway has deployed 0.9 million set-top boxes (STBs) in the fiscal third quarter to take its total subscriber base to 9.6 million. With this, 80% of its cable TV universe at the consolidated level is digitised.

hathway-closing-consolidated-numbers-results-12-feb-

The multi-system operator (MSO) has three million subscribers in Phase III. “It is expected that Phase III deployments will further grow once court mandated stay orders in certain markets are vacated,” Hathway said.

ARPU improves marginally

Average revenue per user (ARPU) in Phases I and II has marginally improved. In Phase, ARPU net of taxes inched up from 100 in the fiscal second quarter to Rs 102 in the three months ended 31 December 2015. In Phase II, ARPU grew to Rs 83 in the third quarter from Rs 80 in the preceding quarter.

Prepaid

The MSO launched prepaid for its direct cable TV customers in Bengaluru, helping it to register a 24% increase in collections. Hathway’s Mumbai, Delhi and Pune direct customers have also been converted to prepaid in the third quarter.

“A substantial improvement in collection from direct customers is expected in the following quarters,” Hathway said.

Broadband biz

Hathway added 50,000 broadband subscribers in the third quarter, taking the total base at the consolidated level to 567,000. Broadband number of homes passed in the third quarter grew to 2.8 million homes.

Broadband ARPU at the standalone ARPU was up 3.8% to Rs 683 compared to Rs 658 a quarter ago.

hatheay-Standalone-ARPU-Trend-12-feb

Revenue for third quarter increased 26% year-on-year (YoY). Adjusted EBITDA net off activation and license fees increased 95% YoY to Rs 33.8 crore (Rs 338 million).

The financial results for the third quarter takes into account 8% license fee in the broadband business. The company had moved TDSAT for a stay on the license fee and the tribunal has granted stay till the disposal of the matter. “If license fee is added back, EBITDA would increase by 6.3 crore for the quarter,” Hathway said.

Debt

Hathway’s standalone gross debt stood at Rs 1,399 crore (Rs 13.99 billion) and net debt at Rs 1,337.2 crore (Rs 13.37 billion).

Consolidated gross debt is at Rs 1,829.8 crore (Rs 18.3 billion) and net debt at Rs 1,711.5 crore (Rs 17.12 billion).