African acquisition weighs Bharti down
10 July 2013, 09:39
Lagos - While its African acquisition is yet to turn into a profitable venture, Bharti Airtel said it had begun repaying debts of over $11.74 billion.
The company announced two months ago that its net quarterly profit had halved during the final financial quarter to March citing fierce competition and punishing interest charges.
Bharti Airtel founder and chairman, Sunil Bharti Mittal, said consolidated net profit for the three months to March tumbled to 5.08 billion rupees ($94 million), down from 10.06 billion rupees (about $190 million) in the same period a year earlier.
The drop in profit marked the mobile giant’s 13th straight quarterly fall and was well wide of analysts’ forecasts of a 7.0-billion-rupee profit, leading to a sharp fall in its shares.
Bharti’s earnings have been weighed by the debt it took to fund its purchase of the African operations of Mobile Telecommunications Co.
K.S.C. and to buy bandwidth for third-generation, or 3G telecom services.
Bharti owned about a third by SingTel - raised $1.5 billion by selling bonds in the overseas market during the January-March quarter to repay some high-cost loans.
It also sold stakes in some of its units earlier to raise funds to reduce debt.
- CAJ News