Vodafone Idea Q1 loss narrows to Rs 7,319 crore

Debt-ridden private telecom company Vodafone Idea on Saturday posted a lower consolidated loss of Rs 7,319 crore for the first quarter ended on June 30, 2021, against Rs 25,460 crore loss in the same quarter a year ago.

The consolidated revenue from operations of Vodafone Idea (VIL) declined by about 14 per cent to Rs 9,152.3 crore during the reported quarter from Rs 10,659.3 crore in the corresponding quarter of 2020-21.

The total gross debt (excluding lease liabilities and including interest accrued but not due) as of June 30, 2021, of VIL stood at Rs 1,91,590 crore, comprising deferred spectrum payment obligations of Rs 1,06,010 crore and adjusted gross revenue (AGR) liability of Rs 62,180 crore that are due to the government.

The company had filed a review petition before the Supreme Court in which it has claimed that erroneous calculation of AGR by the DoT will cost the company around Rs 25,000 crore, which includes principal amount of Rs 5,932 crore with interest and penalty and interest on the penalty.

It has said that the correction in the demand is necessary for survival of the company.

Cash and cash equivalents of the company at the end of reported quarter were Rs 920 crore and net debt stood at Rs 1,90,670 crore.

“We continue to focus on executing our strategy to keep our customers ahead, and our cost optimisation plan remains on track to deliver the targeted savings. We are in active discussion with potential investors for fundraising, to achieve our strategic intent,” VIL MD and CEO Ravinder Takkar said in a statement.

The company has undertaken the cost optimisation exercise in line with the evolving industry structure and business model.

VIL has a target to achieve Rs 4,000 crore of annualised cost savings by the end of this calendar year and claims to have achieved about 70 per cent of the targeted annualised savings on a run-rate basis by the end of the reported quarter.

The subscriber base of VIL continued to decline. The company’s subscriber base at the end of the reported quarter declined to 25.54 crore compared with 26.78 crore it had in January-March quarter and 27.98 crore in the same quarter a year ago.

“The subscriber base, however, declined by 12.3 million as the second wave of COVID disrupted economic activity, with lockdowns or restricted store timings impacting the gross additions during the quarter,” VIL said.

The 4G subscriber base of the company increased to 11.29 crore during the reported quarter from 10.46 crore a year ago.

The average revenue per user of the company declined to Rs 104 compared with Rs 114 a year ago. Some respite for the company came from growth in data volumes, which grew by 13.2 per cent on quarter-on-quarter basis driven by higher data demand during the lockdown.

Data usage per broadband subscriber on the company’s network increased to 14.6 GB per month compared with 12.8 GB per month in the January-March quarter.

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