The country’s largest telecommunications tower company, Bharti Infratel, on Tuesday reported a 19% year-on-year increase in its fourth-quarter net profit, boosted by expansion of networks by its major clients and helped by a lower finance costs.
During the January-March quarter, Bharti Infratel’s net profit grew from Rs 557.5 crore to Rs 661.7 crore during the same period a year earlier, the company said in a regulatory filing.
Its revenue also increased by 7% during the quarter from Rs 2946.7 crore to Rs 3161.9 crore, it said. The profits were boosted by a 31% fall in finance costs during the three months through March which came in at Rs 45.7 crore from Rs 65.8 crore, and an 2% lower income tax expense from a year earlier to Rs 315.9 crore, the company said.
Moreover, the New Delhi-based company also trimmed down its capital expenditure during the just ended quarter by 7% at Rs 525.7 crore, it said.
The company – owned about 71.70% by Bharti Airtel – builds, owns and leases communications infrastructure such as towers to telecommunications companies including its rivals Vodafone India, Idea Cellular, and Reliance Jio Infocomm.
It also co-locates towers with Indus Towers, a three-way joint venture between Bharti Airtel, Vodafone India, and Idea Cellular. During the fourth quarter, the company added 753 towers, taking the total number of such towers to 88,808 at end of March, as mobile phone operators expanded their networks to offer 3G/4G services as well as to address call drop issues. The network expansion by sharing of towers in turn helped Bharti Infratel’s average sharing ratio to reach 2.19 times at end of March, compared to 2.17 times during the previous three months through December, the company said.
Increased tenancy on each tower had pushed the sharing revenue per tower higher by 5.6% on-year to R75,856 from R71,828, while its sharing revenue per operator rose 1.9% to R34,671 , the company said.
In summary, the higher tenancy and marginal increase in revenue sharing per operator, helped its Ebidta margin to expand to 45.7% during the past quarter from 45.1%, a year earlier. At end of March 2016, Bharti Infratel had an average residual service contract period with its clients for about 5.38 years, while its total minimum lease payment receivable stood at about R46,474.4 crore.
On Tuesday, Bharti Airtel’s board of directors also approved a proposal to buy back 44,444,444 shares from public investors, constituing about 2.53% of the total paid up equity share capital of the company, for a maximum price of R450 per share. The total amount for buyback of shares has been fixed at R2,000 crore, the company said.
Bharti Airtel, the parent company of Bharti Infratel is scheduled to announce its earnings for the fiscal fourth quarter on Wednesday after market hours.