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Airtel Digital TV adds 530,000 subs in Q3, EBITDA at Rs 247 cr

MUMBAI: For Airtel Digital TV, the fiscal third quarter has been outstanding in terms of subscriber growth. The DTH arm of Bharti Airtel added 530,000 net subscribers, its highest in the last 18 quarters.

Average revenue per user (ARPU) saw modest increase to Rs 229 due to higher HD penetration and upselling of packs.

Operating profit grew 45% to Rs 247.4 crore (Rs 2.47 billion) from Rs 170.7 crore (Rs 1.71 billion) a year ago. The QoQ increase was 5.59% as EBITDA in the second quarter of the fiscal stood at Rs 234.3 crore (Rs 2.34 billion).

EBITDA margin at 33.3% in the current quarter compared to 33.1% in the trailing quarter and 27.4% a year ago. The DTH operator’s EBIT jumped 216% to Rs 53.8 crore (Rs 538 million) in the current quarter compared to Rs 17 crore (Rs 170 million) in the preceding quarter. The company reported EBIT loss of Rs 36 crore (Rs 360 million) in the corresponding quarter of the previous fiscal.

Airtel Digital TV Services jan16

Revenue

Airtel Digital TV’s total revenue grew 5% to Rs 742.2 crore (Rs 7.42 billion) from Rs 706.8 crore (Rs 7.07 billion) in the previous quarter. Revenue was 19% higher from the year-ago period. In the third quarter of FY15, revenue stood at Rs 623.4 crore (Rs 6.23 billion).

ARPU

ARPU saw a modest 2% growth on a quarter-on-quarter (QoQ) basis. It increased to Rs 229 as compared to Rs 224 in the fiscal second quarter. ARPU grew 7% from the earlier year when it was at Rs 214.

4.5 Digital TV Services jan16
Subscriber additions

Airtel Digital TV mopped up the highest net customer addition in the last 18 quarters at 530,000, representing a 223% increase over the previous quarter and 96% growth from the earlier year. For the quarter ended 30 September, the DTH operator had a net addition of 164,000 subscribers. In the year-ago period, it had collected 270,000 customers.

As on 31 December 2015, Airtel Digital TV’s total subscriber base stood at 11.1 million, representing an increase of 13.2% as compared to the corresponding quarter last year. In the previous quarter, the total subscriber base was 10.5 million.

Churn

Monthly churn reduced to 0.7% during the quarter compared to 1.3% in the trailing quarter and 1% a year ago.

Capex

Capital expenditure incurred in the fiscal third quarter jumped 37% to Rs 342.2 crore (Rs 3.42 billion) compared to Rs 250.1 crore (Rs 2.5 billion) in the trailing quarter. In Q3 of FY15, capex was Rs 163 crore (Rs 1.63 billion).

The company’s cash burn during the quarter was higher at Rs 94.8 crore (Rs 948 million) primarily on account of higher capex spends due to higher gross additions in the festive season and higher market stock for conditional access system (CAS). This compared to cash flow of Rs 77 million in the corresponding quarter of the previous fiscal. In the preceding quarter, the cash burn rate was Rs 15.8 crore (Rs 158 million).

Cumulative investment

Bharti Airtel’s cumulative investment in the DTH business was Rs 6,177 crore (Rs 61.77 billion) at the end of the quarter. As of 30 September 2015, the company’s cumulative investment in the DTH business had touched Rs 5,865.3 crore (Rs 58.65 billion).

The DTH operator launched its first 4K Ultra HD (UHD) channel during the quarter. Currently, it offers 486 channels including 38 HD channels, four international channels and four interactive services. The company had its digital TV operations spread across 639 districts, as on 31 December 2015.