Press Releases

Digitalisation drives a strong Q3 performance | Tata Communications’ 9M data revenues; up 9.7% YoY

Q3 PAT USD 210.6 mn USD | 9M data EBITDA up 16.9% YoY

Mumbai (BSE) – January 23, 2017

Tata Communications today announced its financial results for the nine months and quarter ended on December 31st 2016.

Highlights | Q3 FY2017

  • Data revenues were buoyed by both traditional[1] and growth services[2] as global demand for data continues to gain momentum significantly

 

Consolidated Nos. INR Crore QoQ Growth YoY Growth USD Mn QoQ Growth YoY Growth
Gross Revenue 4,872 (4.3%) (4.5%) 723.2 (4.9%) (6.5%)
EBITDA 722 (16.8%) (3.7%) 107.1 (17.4%) (5.8%)
PAT 1,413 3436% 1,176% 210.6 3430.7% 1147.7%

 

  • Consolidated PAT stood at INR 1,413 Crores. Contribution from an exceptional one-time gain from the stake sale of the India Data Centre (INR 2,138 Crores) was offset by the impairment (INR 250 crores) on account of the South African subsidiary – Neotel
  • Quarterly revenue and EBITDA growth were impacted by the exclusion of the India data centre revenue with effect from October 19, 2016 and also a couple of regulatory changes that led to modifications in access facilitation agreements and the demonetisation drive which affected the payment solutions business

 

Core Nos. INR Crore QoQ Growth YoY Growth USD Mn QoQ Growth YoY Growth
Gross Revenue 4,419 (5.8%) (5.6%) 655.9 (6.3%) (7.6%)
EBITDA 592 (24.0%) (10.6%) 87.7 (24.6%) (12.6%)
EBITDA margin 13.4% (322bps) (75bps) 13.4% (324bps) (77bps)
PAT 1,359 4,704% 1,1154% 202.6 4,705% 1,118%

 

  • Core business (consolidated excluding Neotel) growth was impacted by a decline in global voice demand (which continues to be a challenge for operations) and the adjustments made on account of the exclusion of the data centre revenues and one off adjustments
  • On a like to like basis the normalised EBITDA margin stood at 16.8% for Q3 and normalised EBITDA growth at 17.5% YoY

 

Highlights | 9 Months FY2017

  • Consolidated EBITDA improved by 7.3% while consolidated revenue declined marginally by 2.7% YoY at INR 14,995
Consolidated Nos. INR Crore YoY Growth USD Mn YoY Growth
Gross Revenue 14,995 (2.7%) 2,235.9 (6.0%)
EBITDA 2,453 7.3% 365.8 3.6%
PAT 1,495 461.3% 222.8 441.8%

 

Core Nos. INR Crore YoY Growth USD Mn YoY Growth
Gross Revenue 13,739 (1.0%) 2,048.6 (4.4%)
EBITDA 2,157 9.9% 321.6 6.1%
EBITDA margin 15.7% 155bps 15.7% 155bps
PAT 1,478 694.0% 220.3 666.5%

  • 9M PAT for core business (consolidated excluding Neotel) was up 694% YoY
  • 9M FY17 core revenue growth was 0.6% and core EBITDA growth was 19.4% YoY on a normalised basis

 

Commenting on the results, Vinod Kumar, MD and CEO, Tata Communications said, “These results illustrate our strategic intent, in both financial and operational terms. We continue to face challenges in the voice sector but our investment in digital competencies holds us in good stead for the future. Our recent investment in Teleena Holding B.V. reflects our strategic vision to build further capabilities in mobility and IoT, creating an access and usage agnostic, cross-border mobile experience for humans and machines alike.”

“These are exciting times with digitalisation creating new avenues for value and impact across the ecosystem. We continue to focus on building an agile enterprise, prioritising operational efficiency to continue to deliver first class solutions to our customers and partners worldwide.”

Pratibha K. Advani, CFO, Tata Communications said, “The operational performance of the business continues to be robust as the growth trajectory in the data business continues to be positive. The process of de-leveraging has begun and the business is generating healthy free cash flow.”

 

Corporate highlights | Q3 FY2017

 

Business highlights | Q3 FY2017

  • Hitachi Sunway and Tata Communications Strengthen Presence in ASEAN – With this partnership, Hitachi Sunway will now be able to provide its more than 1000 enterprise customers in ASEAN access to Tata Communications’ robust portfolio of Managed Network Services, Managed Security Services and Unified Communications & Collaboration (UCC) offerings.
  • Semtech and Tata Communications to inaugurate ‘Applications Center for LoRa Technology’ in India – Both partners are set to launch the first applications centre dedicated to LoRa® Technology in Mumbai, India. The centre allows enterprise customers and Internet of Things (IoT) solution providers to deploy and test their applications over a LoRaWAN™-based low power, wide area network (LPWAN). Following successful LoRaWAN network trials in Mumbai, Delhi and Bengaluru, Tata Communications and Semtech have worked together to deploy 35 IoT proofs-of-concept (PoCs) based on LoRa Technology across these cities. The PoCs cover a wide array of applications, including sensors for remotely monitoring air conditioners and safety deposit boxes, energy management systems used to optimize the use of electricity, gas and water, and multiple smart buildings and smart city applications.
  • Tata Communications launches a new brand campaign in India – The major multi-channel brand campaign in India has been designed to highlight the company’s diverse services portfolio that enables digital transformation for businesses and its contribution to the ‘Make in India’ narrative, the campaign will roll out in December 2016 through to the end of June 2017. The campaign will look to celebrate the company’s customers and partners in India. Unfolding across India’s busiest airports of Mumbai, Delhi, Bangalore and Pune, and reaching over 100 million travellers, this campaign also includes the sponsorship of major industry and technology events in India as well as an extensive online advertising campaign with leading business publications, generating over 100 million impressions on all its digital channels.
  • Tata Communications launches IZO™ SDWAN to enable organisations to unleash their global growth potential – As the myriad of different applications, clouds, data sources and connections create complexity for organisations, IZO™ SDWAN helps them detangle this complexity and propel their growth through seamless, secure and easy-to-manage connectivity across 130 countries spanning both developed and emerging markets.
  • Emirates Data Clearing House and Tata Communications partner to simplify global borderless mobility – The bilateral partnership is aimed at mutual business cooperation in their data and financial clearing forte offerings to mobile network operators across the globe. The partnership will enable Tata Communications to provide a more robust portfolio of solutions as an integrated mobility service provider with its existing range of innovative solutions. EDCH will in turn expand their geographical avenues significantly towards global markets with an enhanced roaming and mobility management portfolio.

 

An Investor fact sheet providing a detailed analysis of the results for the half year and quarter ended December 31st 2016 has been uploaded on the Tata Communications website and can be accessed at: http://www.tatacommunications.com/sites/default/files/FIN-investorfact-sheet-PDF-20170123.pdf


[1] Traditional services include Virtual Private Network, International Private Line, Internet Leased Line, Ethernet, Internet Protocol –Transit, Inmarsat, Content Delivery Network, National Private Line, Mobility, Data Centre, Unified Collaboration and Conferencing

[2] Growth services include IZO™, Managed Hosting, Managed Security Services, Broadcast, Video Connect, SIP Trunking, Global Hosted Contact Center, Video Streaming, Mobile New Services, Healthcare, Media Management and Mobile Innovation.

Ends…


 

FOR IMMEDIATE RELEASE

PRESS RELEASE

Natalie Chak
Tata Communications
+44 (0)7833 043 779
natalie.chak@tatacommunications.com
Neil Thomas
Hill & Knowlton Strategies
+44 207 413 3454
neil.thomas@hkstrategies.com

About Tata Communications

Tata Communications Limited (CIN no: L64200MH1986PLC039266) along with its subsidiaries (Tata Communications) is a leading global provider of A New World of Communications™. With a leadership position in emerging markets, Tata Communications leverages its advanced solutions capabilities and domain expertise across its global and pan-India network to deliver managed solutions to multi-national enterprises, service providers and Indian consumers.

The Tata Communications global network includes one of the most advanced and largest submarine cable networks and a Tier-1 IP network with connectivity to over 240 countries and territories across 400 PoPs, as well as nearly 1 million square feet of data centre and collocation space worldwide.

Tata Communications’ depth and breadth of reach in emerging markets includes leadership in Indian enterprise data services and leadership in global international voice. Tata Communications Limited is listed on the Bombay Stock Exchange and the National Stock Exchange of India.

http://www.tatacommunications.com

Forward-looking and cautionary statements

Certain words and statements in this release concerning Tata Communications and its prospects, and other statements, including those relating to Tata Communications’ expected financial position, business strategy, the future development of Tata Communications’ operations, and the general economy in India, are forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors, including financial, regulatory and environmental, as well as those relating to industry growth and trend projections, which may cause actual results, performance or achievements of Tata Communications, or industry results, to differ materially from those expressed or implied by such forward-looking statements. The important factors that could cause actual results, performance or achievements to differ materially from such forward-looking statements include, among others, failure to increase the volume of traffic on Tata Communications’ network; failure to develop new products and services that meet customer demands and generate acceptable margins; failure to successfully complete commercial testing of new technology and information systems to support new products and services, including voice transmission services; failure to stabilize or reduce the rate of price compression on certain of the company’s communications services; failure to integrate strategic acquisitions and changes in government policies or regulations of India and, in particular, changes relating to the administration of Tata Communications’ industry; and, in general, the economic, business and credit conditions in India. Additional factors that could cause actual results, performance or achievements to differ materially from such forward-looking statements, many of which are not in Tata Communications’ control, include, but are not limited to, those risk factors discussed in Tata Communications Limited’s Annual Reports. The Annual Reports of Tata Communications Limited are available at www.tatacommunications.com. Tata Communications is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements.


© 2017 Tata Communications Ltd. All rights reserved. TATA COMMUNICATIONS and TATA are trademarks of Tata Sons Limited in certain countries.

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