Date:27/10/2004 URL: http://www.thehindubusinessline.com/2004/10/27/stories/2004102703530300.htm

Back VSNL net rises 81 pc in second quarter

Our Bureau

Mumbai , Oct. 26

VIDESH Sanchar Nigam Ltd (VSNL) has reported an 80.9 per cent increase in net profit for the second quarter of the current fiscal; this is on a slight decrease in total income for the same period.

Net profit amounted to Rs 88.1 crore (Rs 48.7 crore) while total income amounted to Rs 807.9 crore (Rs 821.8 crore).

The hefty growth in net profit showed largely on account of an expenditure of Rs 56.8 crore towards voluntary retirement schemes during the corresponding quarter of the previous year which considerably reduced the net profit for that quarter. Partly, the growth in net profit is also due to containment of expenses, especially network costs.

Total expenditure during the quarter was Rs 607.2 crore, down from Rs 658.2 crore during the year-ago second quarter. Network costs stood reduced to Rs 490.6 crore, from Rs 564 crore. Depreciation amounted to Rs 56.8 crore (Rs 40.6 crore).

Profit before tax and exceptional items, at Rs 144 crore, showed an 18 per cent increase over the previous year's Rs 122 crore. Profit before tax and after exceptional items was at Rs 144 crore. Provision for taxation, at Rs 56 crore (Rs 16.5 crore), was considerably higher than the same year-ago figure. Revenues from international telephony and related services, which accounted for 75 per cent of total revenues for the quarter, showed a 14.2 per cent decline, falling to Rs 584.6 crore, from Rs 682 crore. Profit before interest and tax from this segment showed a 4 per cent increase, and stood at Rs 160 crore (Rs 154.6 crore).

Revenues from services other than international telephony and related services continued to increase; they grew 79 per cent, to Rs 194 crore, up from Rs 93.5 crore; while profit before tax and interest from this segment rose 108 per cent, to Rs 132 crore, up from Rs 63.6 crore. For the half year ended September 30, VSNL has reported a net profit of Rs 214.9 crore, 87.6 per cent higher than that of the previous first half, at Rs 114.5 crore. Revenues during this period fell 6.9 per cent, to Rs 1,572 crore, from Rs 1,612 crore.

Consequent to the settlement, an amount of Rs 46.9 crore has been included in the net sales during the quarter ended June 2004, in keeping with accounting standards for events happening after balance sheet date, said a statement from the company.