Vodafone Idea recorded a sharply lower net loss in its fiscal Q2 (to 30 September) due to a reduction in exceptional charges and progress in cost-cutting, as the third-ranked operator in India continued to shed subscribers.
Net loss fell to INR72 billion ($967.6 million) from INR509 billion as impairment and exception charges plunged to INR7.67 billion from INR308 billion in the same period of 2019. Revenue was flat at INR107.9 billion.
MD and CEO Ravinder Takkar said while it continued to face Covid-19 (coronavirus) challenges, the period showed signs of recovery with a gradual improvement in economic activities.
“We are executing on our strategy and our cost optimisation exercise has already started to yield incremental savings. We have also initiated a fundraising exercise to support our strategic intent. We continue to interact with the government seeking long-term solutions to the critical challenges which the industry faces.”
After achieving targeted merger opex savings of INR84 billion, Takkar said it started the cost optimisation exercise across the company in line with an evolving industry structure and business model.
It aims to achieve INR40 billion of annualised cost savings over 18 months.
The operator stated: “Our ability to continue as [a] going concern is essentially dependent on successful negotiations with lenders and its ability to generate the cash flow that it needs to settle and refinance its liabilities and guarantees as they fall due.”
Its subscriber base declined 39.3 million to 271.8 million, of which 106 million were 4G users, up 10.2 million. ARPU increased 11.2 per cent to INR119.
The operator said it deployed more than 10,000 4G FDD sites, primarily through refarming of 2G and 3G spectrum to expand capacity.
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