Q1 FY22 PAT at INR 296 Crores I Focus on profitability with EBITDA margin expansion of 40 BPs YoY

Mumbai, August 04, 2021

Tata Communications, a global digital ecosystem enabler, today announces its financial results for the quarter ended 30th June 2021.

Highlights | Q1 FY2022

Consolidated financial highlights

  • Consolidated revenue came in at INR 4,103 Crore (USD 556 Mn), growth of +0.7% Quarter-on-Quarter (QoQ), and 6.8% decrease Year-on-Year (YoY). This YoY contraction is primarily due to reduction in Voice business and moderation of Collaboration traffic in the Data segment
  • Consolidated EBITDA stood at INR 986 Crore (USD 134 Mn); reduction of 5.3% YoY. This quarter, EBITDA has been impacted by a provision of INR 33 Crore on account of license fee on revenue from pure internet services which was allowed as deduction in the definition of Adjusted Gross Revenue (AGR) earlier. Despite this impact EBITDA margin has expanded by 40 BPs YoY
  • Consolidated Profit After Tax (PAT) is at INR 296 Crore (USD 40 Mn) for Q1 FY22 as compared to a profit of INR 258 Crore in Q1 FY21, registering a growth of 14.9% YoY
  • CAPEX for this quarter grew to INR 381 Crore as compared to INR 372 Crore in Q1 FY21

 

Consolidated Nos. INR Crore YoY Growth
Gross Revenue 4,103 (6.8%)
EBITDA 986 (5.3%)
EBITDA margin 24.0% 40 BPs
PAT 296 14.9%

Data services portfolio

  • Data business revenue came in at INR 3,104 Crore witnessing a growth of + 0.6% QoQ and a -2.2% YoY reduction. Data business continues to be affected by COVID related slowdown. Enterprise decisions have been slow due to macroeconomic headwinds leading to longer lead time for deal wins. Service delivery was affected by lockdowns during the 2nd Wave of COVID-19 pandemic
  • EBITDA for the segment stood at INR 932 Crore; up +0.4% QoQ and decline of -2.4% YoY. EBITDA was affected by provision of license fee made during the quarter and despite this impact EBITDA margin is maintained at 30%.
  • In Core Connectivity, there is a healthy growth in revenue by +1.7% YoY, and EBITDA increased by +0.3% YoY with margins at 42.6%
  • Digital Platforms and Services were affected by moderation of Collaboration traffic which was at its peak in Q1 FY21. Revenue strengthened by 2.9% QoQ but reduced by -12.8% YoY. There are early signs of recovery and an uptake of usage based services in geographies where economies have opened

 

“In a challenging quarter impacted by the second wave of COVID-19, we have delivered a robust performance,” said A S Lakshminarayanan, Managing Director and CEO, Tata Communications. “The global markets are slowly opening up and we are witnessing greenshoots of demand recovery.”

He added, “Our focus is to continue investing in developing innovative digital ecosystem solutions driven by customers’ needs. Early demand for our recent launches for live sports on our Media Edge Cloud and IZO™ Financial Cloud is testament that we are moving in the right direction.”

 

Commenting on the results, Kabir Ahmed Shakir, Chief Financial Officer, Tata Communications, said, “Our focus on growth and profitability continues to deliver results. A healthy profit and free cash flow is empowering us to innovate and accelerate growth while streamlining processes and bringing in further efficiencies. We are well-poised to enable enterprises make the shift with digitalisation playing a pivotal role enabling businesses derive positive growth.”

 

An investor fact sheet providing detailed analysis of the results for the quarter ended 30th June 2021 has been uploaded on the Tata Communications website and can be accessed here.

Ends...


Media contact: Arati Mukerji Tata Communications +91 9958895759 arati.mukerji@tatacommunications.com Investor contact: Vipul Garg Tata Communications +91 (11) 6625 7431 vipul.garg@tatacommunications.com

About Tata Communications

A part of the Tata Group,  Tata Communications (NSE: TATACOMM; BSE: 500483) is a global digital ecosystem enabler powering today’s fast-growing digital economy in more than 190 countries and territories. Leading with trust, it enables digital transformation of enterprises globally with collaboration and connected solutions, core and next gen connectivity, cloud hosting and security solutions and media services. 300 of the Fortune 500 companies are its customers and the company connects businesses to 80% of the world’s cloud giants. Its Tier-1 IP network, wholly-owned subsea fibre backbone and consortium cables’ global network carries ~30% of the world’s internet routes. For more information please visit 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.

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