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Hathway’s Q1 net loss narrows, revenue drops 14.5%
MUMBAI: A change in method led to higher depreciation provision, preventing Hathway Cable & Datacom from turning positive on the net level in the fiscal first quarter.
Hathway posted a standalone net loss of Rs 92.47 lakh (Rs 9.25 million) in the June quarter compared to a net loss of Rs 49.26 crore (Rs 492.6 million) in the preceding quarter. In the year-ago quarter, it had posted a net profit of Rs 5.32 crore (Rs 53.23 million).
The company suffered a 14.5 per cent dip in its top line. Operating revenue stood at Rs 250.22 crore (Rs 2.50 billion), compared to Rs 292.72 crore (Rs 2.93 billion) in the trailing quarter. In the year-ago period, income from operations stood at Rs 232.65 crore (Rs 2.33 billion).
Delays in the implementation of digital addressable system (DAS) in Phase I and II metros, as well as challenges faced by MSOs in executing contracts with the subscribers and implementation of revenue sharing with the local cable operators (LCOs), impacted revenues.
At the operational front, Hathway managed to trim operating loss on the back of lower pay channel costs.
Operating loss for the quarter (before other income, finance costs and exceptional items) stood at Rs 3.88 crore (Rs 38.8 million) compared to a loss of Rs 20.80 crore (Rs 208 million) in the trailing quarter. In the corresponding quarter of the previous fiscal, the company recorded operating profit of Rs 34.55 crore (Rs 345.49 million).
Total operating expenses stood at Rs 254.10 crore (Rs 2.54 billion), showing a decline of 18.9 per cent, compared to Rs 313.52 crore (Rs 3.13 billion) in the fourth-quarter ended 31 March 2014. In the year-ago period, total expenses stood at Rs 198.1 crore (Rs 1.98 billion).
Hathway’s employee costs jumped 43.8 per cent to Rs 14.55 crore (Rs 145.5 million), compared to Rs 10.12 crore (Rs 101.2 million) in the trailing quarter. It was Rs 13.77 crore (Rs 137.7 million) in the year-ago period.
However, pay channel costs dropped 25.65 per cent to Rs 85.80 crore (Rs 858.05 million), compared to Rs 115.41 crore (Rs 1.15 billion) in the trailing quarter. In the year-ago period, this stood at Rs 58.45 crore (Rs 584.5 million).
A change in depreciation provisioning resulted in a net surplus of Rs 41.86 crore (Rs 418.6 million) which is adjusted against provisioning of doubtful advances/investments, etc. aggregating to Rs 12.99 crore (Rs 129.9 million). Net impact of Rs 28.87 crore (Rs 288.7 million) from exceptional items ultimately pushed Hathway into the red for the quarter under review.