Vodafone Idea books first batch of post-merger results

15 Nov 2018

Vodafone Idea, the entity formed by the combination of Vodafone India with Idea Cellular, has reported its first quarterly results since completing the merger in August this year, registering pro-forma revenue of INR120.2 billion (USD1.67 billion) for the three-month period, down by 7.1% quarter-on-quarter, and EBITDA of INR9.8 billion (down 29.7% q-o-q). As the merger was only completed on 31 August, the pro-forma figures treat Vodafone India as a merged entity from 1 April. The enlarged entity’s reported figures for the period – comprising only Idea Cellular until 30 August and including Vodafone India from 31 August – featured revenue of INR76.6 billion and EBITDA of INR4.6 billion. The cellco registered a net loss of INR49.5 billion for the quarter. Vodafone Idea counted a total of 422.3 million mobile subscribers at end-September, down from 435.4 million three months earlier, whilst monthly ARPU dipped from IN92 to INR88. Combined 3G and 4G subscriptions, however, grew from 95.3 million to 99.7 million q-o-q.

Commenting on its first batch of results, CEO Balesh Sharma said: ‘We have set on a strong course with meticulous pre-merger planning and rigorous post-merger execution. In just 75 days of operations, several milestones have been achieved, ahead of expected timeline. We are thus well on track to deliver the synergies envisaged at the time of merger. Going forward, we remain focused on accelerating integration momentum for higher synergy realisation; expanding coverage and capacity of our 4G network; providing the best of customer experience to our retail and enterprise customers; and in creating an agile and future-fit organisation. Shareholders’ support along with assets monetisation puts us into a strong position to achieve our strategic intent.’

Post-merger integration remains the cellco’s top priority and to date, the operator has given notice on around 66,000 co-located sites where it will convert current rentals to lower loading charges for the remaining equipment. The cellco has also started the process of consolidating spectrum and integrating the networks, with circle-level CAPEX planning and vendor selection already completed.

Meanwhile, the company notes that it has received interest in its 156,000km inter and intra-city fibre network and has decided to ‘actively explore’ a potential sale of the assets. The operator’s directors have been instructed to evaluate potential routes for raising up to INR250 billion of equity, and promoter shareholder Vodafone Group and Aditya Birla Group have indicated that they would contribute up to INR110 billion and INR72.5 billion respectively as part of such a capital raise.

India, Vodafone Idea (previously Idea Cellular), Vodafone India