Siti Networks Q1 EBITDA up 54%, adds 1.6 mn digital cable subs

MUMBAI: Siti Networks’ operating profit in the fiscal first quarter was boosted by activation revenue while 1.6 million digital subscribers were added.

The multi-system operator’s (MSO) EBITDA was up 54% to Rs 107.2 crore in the quarter ended 30 June 2017 compared to Rs 69.4 crore a quarter ago.

Revenue increased 10% quarter-on-quarter (QoQ) to Rs 371 crore from Rs 337.8 crore.

Subscription revenue was up 6% at Rs 170 crore. Activation revenue grew 75.2% QoQ to Rs 84.9 crore.

Carriage revenue fell 4.1% QoQ to Rs 77 crore.

Broadband revenue fell 2.9% QoQ to Rs 25.8 crore. Broadband subscriber base was at 2.40 lakh compared to 2.28 lakh in the previous quarter.

The company added 1.6 million digital cable customers in West Bengal, Haryana, Andhra Pradesh and Telangana, primarily in Phase IV areas, taking its total digital cable subscriber base to 11.6 million. It also added 60,000 HD subscribers to take the total HD subscriber base to 2.2 lakh.

The company also said that its prepaid migration was on track with 1.16 million subscribers across 134 locations brought under its ambit by August 2017.

As a strategy, the MSO has focused on higher ‘lock-in’ plans in Q1. About 40% of acquisitions are coming on longer-term plans. It is targeting to take this figure to 50%+ in Q2. This will lead to better long-term value for the customer, reduced churn and increased customer stickability.

A significant increase in average plan speed and data consumed will create a sharp value story for customers. The company expects a resultant sharp increase in customer data consumption, indicating a higher involvement with the services, Siti said.

Docsis ARPU continued to move up steadily and June exit ARPUs were in the Rs 650–90 range, across locations, on the back of upselling to better value plans and focus on discretionary customers. New acquisition ARPU in July was around Rs 750/subscriber, which is significantly higher than the base ARPU.

Consolidated gross debt stood at Rs 1,335 crore and net debt at Rs 1,221 crore.

While commenting on the results, Siti Networks executive director Sidharth Balakrishna mentioned, “Siti continues to hold a strong position in the market with record customer additions. We are well positioned to monetise this base from Q2 onwards and maintain a strong growth trajectory. In broadband, we will selectively expand our offerings and drive increased customer focus. We are also making significant efforts to strengthen processes and optimise costs going forward, while also enhancing customer offerings. This, along with a focus on certain revenue streams, could potentially provide upsides going forward.”