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Airtel Digital TV Q1 ARPU touches new high, EBITDA up 15.9% QoQ

MUMBAI: Airtel Digital TV, the direct-to-home (DTH) arm of telecom operator Bharti Airtel, has remained EBIT positive for the second straight quarter and has touched a new ARPU (average revenue per user) high of Rs 222 in the first quarter of the fiscal.

ARPU trend

In the trailing quarter, ARPU stood at Rs 214. According to the company, adjusting for the impact of change in accounting for indirect taxes, the underlying ARPU improvement over last year is Rs 27.

Airtel Digital TV also continued its trend of strong subscriber additions during the first quarter. The company added 339,000 subscribers in the quarter ending 30 June 2015, compared to 263,000 in the trailing quarter. In the corresponding quarter of the previous fiscal, it had added 376,000 net subscribers.

The company’s total net subscriber base now stands at 10.412 million.

Dish TV also had a strong subscription growth in the quarter, taking its net subscriber base to 13.3 million. In the June quarter, it added 390,000 net subscribers.

Airtel Digital TV’s monthly churn narrowed to 0.8 per cent per month, from 1 per cent in the preceding quarter. However, in the year-ago period, churn was at 0.6 per cent

Financial performance

EBITDA for the quarter ended 30 June 2015 grew 15.9 per cent to Rs 240.8 crore (Rs 2.41 billion), from Rs 207.8 crore (Rs 2.08 billion) in the trailing quarter. In the year-ago period, EBITDA stood at Rs 143.8 crore (Rs 1.44 billion).

EBIDTA margin also improved significantly to 35.2 per cent in the quarter, compared to a margin of 32.7 per cent in the preceding quarter, or 24.3 per cent in the year-ago period.

The company also reported EBIT of Rs 41.5 crore (Rs 415 million) in the current quarter, compared to EBIT of Rs 8 crore (Rs 80 million) in Q4FY15 and EBIT loss of Rs 62.5 crore (Rs 625 million) in the corresponding quarter of the previous fiscal.

Airtel DTV Rev and EBIDTA

 

 

Revenue saw 7.88 per cent growth sequentially. The company’s total revenue was at Rs 684.8 crore (Rs 6.85 billion), compared to Rs 634.8 crore (Rs 6.35 billion) in the trailing quarter.

In the year-ago period, it had made revenue of Rs 591.5 crore (Rs 5.91 billion). The company said that adjusting for change in accounting for indirect taxes since the third quarter of last year, the growth in revenues for DTH is 26.8 per cent compared to the year-ago period and not 15.8 per cent.

Revenue from digital TV services accounted for 4 per cent of Bharti Airtel’s total revenue while EBITDA contribution stood at 3 per cent.

During the quarter, the company incurred a capital expenditure of Rs 211.3 crore (Rs 2.11 billion). Capex stood at Rs 262.7 crore (Rs 2.63 billion) in the trailing quarter and at Rs 133 crore (Rs 1.33 billion) in the year-ago period.

Operating free cash flow during the quarter was at Rs 29.5 crore (Rs 295 million), compared to Rs 74.8 crore (Rs 748 million) in the trailing quarter. However, in the year-ago period, cash burn was at Rs 118.9 crore (Rs 1.19 billion).

As of 30 June 2015, the company’s cumulative investment in the DTH business touched Rs 5,621.6 crore (Rs 56.22 billion).

Airtel Digital TV offers 470 channels including 30 HD channels, four international channels and three interactive services across 639 districts in India.

During the quarter, Airtel Digital TV announced the launch of its first indigenously manufactured set-top boxes. The STBs will be available in HD to begin with and soon all of Airtel Digital TV’s boxes would be manufactured in India, the company announced.

It is important to note that from the third quarter of last fiscal onwards, the company had started harmonising the accounting of indirect taxes in line with other segments and industry standards. Such taxes were earlier part of opex and are now netted off against revenues.