Financial Daily from THE HINDU group of publications
Wednesday, Oct 26, 2005
Info-Tech - Financial Performance
VSNL posts flat growth in Q2
Mumbai , Oct. 25
VIDESH Sanchar Nigam Ltd has announced a near flat growth of 3.2 per cent in net profit for the second quarter ended September 30, 2005.
This was due to a modest increase in sales resulting from fall in tariffs, more than corresponding increase in expenditure, negative segment results from `other services,' and higher depreciation.
Net profit for the quarter amounted to Rs 91 crore, up from Rs 88 crore the previous corresponding quarter.
Net sales rose by 19.3 per cent, to Rs 929.5 crore (Rs 778.9 crore), and total income by 18.9 per cent, to Rs 961.2 crore (Rs 807.9 crore).
Total expenditure rose by 21.6 per cent to record at Rs 738.5 crore (Rs 607 crore), expenditure rising across all heads.
Depreciation rose by 57 per cent, to Rs 89.3 crore (Rs 56.8 crore)
Profit before tax showed a decline of 4.9 per cent, at Rs 136.9 crore (Rs 144.1 crore).
Telephony and related services reported segment results of Rs 404.6 crore (Rs. 292.5 crore) for the quarter. Other services reported a loss of Rs 4.4 crore (Rs 0.7 crore), these services include transponder lease, television uplinking, gateway packet switching services and video conferencing facilities. The company continued to witness sustained growth in volumes in all its businesses, said a press release from VSNL. "The international and domestic voice volumes continue to grow during the quarter. The volumes in the enterprise data business have contributed to this growth, though the tariff drop has impacted revenue growth."
Having acquired the undersea cable network Tyco, and with the acquisition of Teleglobe also in the pipeline, the company will be able to scale up its voice business and compete on a global basis, said Mr N. Srinath, Executive Director, VSNL.
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