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Tata Communications registers PAT of Rs 770 million during QE June 2019 driven by growth in data business

August 05, 2019
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Tata Communications has announced its financial results for the quarter ended (QE) June 2019. As per the results, the company reported a consolidated profit after tax (PAT) of Rs 770 million ($11 million) as compared to a loss of Rs 1.99 billion ($29 million) reported during the QE March 2019. Further, consolidated revenues stood at Rs 41.69 billion ($599 million) registering a growth of over 5.7 per cent on a year-on-year (YoY) basis. According to the company, the growth in data business has helped mitigate the decline in the voice business.

Meanwhile, the consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) stood at Rs 8.26 billion ($119 million), witnessing an increase of over 40.7 per cent on a YoY basis on the back of strong profitable growth in the data business and steady voice margins. The company’s capex for the QE June 2019 stood at $45 million as compared to $60 million in during the QE March 2019.

Financial highlights:

• Strong growth in data business; revenue grew by over 12.4 per cent on a YoY basis on the back of robust performance across all segments, despite industry headwinds

• Growth services witnessed robust momentum; revenue grew by over 29.2 per cent on a YoY basis on the back of strong execution and large deal wins

• Traditional services saw an upsurge in revenue and profitability; revenue grew by over 6.1 per cent on a YoY basis with EBITDA margins at 38.5 per cent

• Data services contributed 79 per cent to the overall revenues, up from 74 per cent during the QE June 2018

• Data EBITDA stood at Rs 7.36 billion ($106 million); a growth of over 42.7 per cent on a YoY basis led by strong profitability in traditional services

Commenting on the results, Pratibha K. Advani, chief financial officer, Tata Communications, said, “Our strategic focus on offering best-in-class digital infrastructure solutions is showing results. The overall share of profitable data services is increasing and performance during the quarter reflects the continued momentum. Robust growth in our enterprise business (over 20 per cent) and growth services (over 29 per cent) is testament to the fact that we are considered as a preferred digital transformation partner. With our continued market focus, we have won large deals across our product portfolio from some of the biggest global enterprises, which are in different stages of execution. Our data business has witnessed robust performance both in terms of revenue and profitability. We have a strong order book and we expect this trend to continue as we keep executing large deals. We are reimagining and transforming our systems, processes and cost structure to achieve even higher level of efficiencies and profitability.”

Business highlights:

• Partnerships:

  • Batelco and Tata Communications: Batelco, Bahrain’s leading digital communications solutions provider announced an extension of its partnership with Tata Communications, to offer flexible and reliable data connectivity with expanded global reach; to service providers, mobile network operators (MNO) and ISPs in the Middle East
  • Cisco and Tata Communications: Tata Communications extended its partnership with Cisco to redefine enterprise networking in the multi-cloud world with new managed SD-WAN solution. The companies will enable enterprises to transform their legacy network to a customised and secure multi-cloud native hybrid network

• New launches:

  • Tata Communications’ IoT Marketplace – The first-of-its-kind IoT marketplace in India: Tata Communications announced the launch of its Internet of Things (IoT) marketplace – a first-of-its-kind initiative in India to strengthen and accelerate the country’s growing IoT ecosystem
  • CII – Tata Communications centre for digital transformation’s ‘Digital Maturity Appraisal’: The CII-Tata Communications centre for digital transformation launched a digital transformation self-assessment tool - the Digital Maturity Appraisal - to help Indian industries navigate today’s business landscape as it continues to undergo rapid changes, led by digital technologies which are transforming the way systems, processes and people work

• Research: Global Talent Competitiveness Index (GTCI) produced in partnership with INSEAD. The Adecco Group and Tata Communications, the GTCI is an annual benchmarking report that measures the ability of 125 countries to compete for talent. The 2019 GTCI saw six Asia Pacific countries ranking in the top quartile with Singapore leading the Asia Pacific in talent competitiveness for the 6th straight year

• Leadership update: On July 30, 2019, Tata Communications announced that it has selected Amur Swaminathan Lakshminarayanan to be appointed as the managing director and chief executive Officer (MD and CEO) of the company

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