Bharti Airtel profit down on price war, forex loss
By ERIKA KINETZ , 08.11.10, 01:11 AM EDT
MUMBAI, India -- Bharti Airtel said quarterly profits fell 32 percent to $361 million on foreign exchange losses and tight competition in its main India market.
A stronger dollar fueled currency losses of $46 million during the quarter, the company said Wednesday.
Revenues for the April-to-June quarter were $2.6 billion, up 17.4 percent over the same period last year. That number includes 23 days of its newly acquired operations in Africa.
"Our business in India and South Asia got off to a solid start with robust revenue growth and healthy margins," chairman Sunil Bharti Mittal said in a statement. "This reaffirms our conviction that leaders emerge stronger in a hyper competitive market."
A price war in India has driven call rates down to less than 1 cent a minute, forcing Bharti, India's largest telecom, to look overseas for growth.
During the quarter it acquired the operations of Kuwait's Zain telecom group in 15 African countries for $10.7 billion. It also bought 3G licenses and broadband licenses in India for $3.4 billion.
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But delays in government security clearances for telecom equipment stalled the rollout of those networks, restricting capital expenditures to $394 million, the company said.
Bharti said it has 183.4 million customers across 18 countries.
Its customers in India's hyper-competitive mobile market, plus small operations in Bangladesh and Sri Lanka, was 140.6 million, up 36 percent from last year.
The results were reported based on international accounting standards.
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