Cable TV

Ortel loss mounts: NCLT orders insolvency process

Ortel’s net loss after taxes for Q2 2019 more than tripled y-o-y

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BENGALURU: Ortel Communications Ltd (Ortel) reported a higher loss for the quarter ended 30 September 2018 (Q2 2019, period or quarter under review) as compared to the immediate trailing quarter Q1 2019 and the corresponding year ago quarter Q2 2018. On 27 November 2018, the National Company Law Tribunal, New Delhi (NCLT) passed an order for commencement of corporate insolvency resolution process (CIRP) based on an application filed by Sony Pictures Network India (SPN) which is an operational creditor of Ortel. The results for Q2 2019 pertain to the period before the CIRP.

Ortel’s net loss after taxes for Q2 2019 more than tripled y-o-y to Rs 17.62 crore as compared to Rs 5.75 crore in Q2 2018. The company had reported loss after tax of Rs 13.48 crore for the immediate trailing quarter. Operating loss (negative EBITDA) for the period under review was Rs 3.39 crore as compared to an operating profit of Rs 12.25 crore in Q2 2018 and an operating profit of Rs 0.21 crore in Q1 2019.

Oretl’s revenue from operations in Q2 2019 declined 34 per cent y-o-y to Rs 31.56 crore as compared to Rs 47.83 crore in Q2 2018, but was fractionally higher by 0.7 per cent q-o-q as compared to Rs 31.35 crore in Q1 2019. Total Income in Q2 2019 declined 33.4 per cent y-o-y to Rs 32.29 crore as compared to Rs 48.51 crore in Q2 2018, but was 1.8 per cent higher q-o-q than Rs 31.71 crore.

Segment numbers

Four segments contribute to Ortel’s revenue. They are cable TV, be, infrastructure leasing and others. Revenues from cable TV, broadband and infrastructure leasing segments declined in Q2 2019 as compared to Q2 2018.

Ortel’s Cable TV segment’s revenue declined 32 per cent in the quarter under review to Rs 25.67 crore from Rs 37.73 crore. The segment reported an operating profit of Rs 6.03 crore in Q2 2019 as compared to an operating profit of Rs 12.16 crore in Q2 2018.

Broadband segment’s revenue declined 44.7 per cent in Q2 2019 to Rs 3.31 crore from Rs 5.99 crore in Q2 2018. The segment’s operating profit declined to less than a fourth (declined 76.3 per cent) in Q2 2019 to Rs 0.32 crore as compared to Rs 1.34 crore in the corresponding quarter of the previous fiscal.

Ortel’s infrastructure and leasing segment had operating revenue of Rs 1.77 crore in Q2 2019 which was 47.4 percent lower than the Rs 3.36 crore in Q2 2018. The segment’s operating profit declined 41.8 per cent in Q2 2019 to Rs 1.48 crore from Rs 2.54 crore in Q2 2018.

The numbers for Ortel’s ‘Others’ segment are small and have not been considered in this report.

Let us look at the other numbers reported by Ortel

Ortel’s total expenditure in Q2 2019 declined 18.1 per cent to Rs 49.91 crore from Rs 50.53 crore in Q2 2018. Programming costs reduced 18.1 per cent in Q2 2019 to Rs 9.11 crore from Rs 11.12 crore in Q2 2018. Bandwidth costs in the quarter under review reduced 24.8 per cent to Rs 3.27 crore from Rs 4.35 crore. Finance costs in Q2 2019 reduced 6.7 per cent to Rs 6.8 crore from Rs 7.29 crore in Q2 2018. Employee benefits expense in Q2 2019 declined 9.7 per cent to Rs 4.63 crore from Rs 5.13 crore in Q2 2018. Other expenses in the quarter under review increased 19.7 per cent to Rs 17.94 crore as compared to Rs 14.98 crore in Q2 2018.

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