SITI Networks Limited (BSE: 532795, NSE: SITINET), has released its Consolidated Financial Results for Q1FY19, ending June 30, 2018.
In line with SITI's Profitable Growth Strategy, SITI has maintained persistent elevation in Operating EBITDA reporting 146% growth over first quarter of last fiscal. SITI reported Operating EBITDA of Rs.549 Mn in Q1FY19 as against Rs.223 Mn on Y-o-Y basis.
The company's Operating EBITDA Margin expanded by 892 bps to ~17%. This has been driven by Subscription Revenue surge of 26.3% to Rs. 2,149 Mn and nearly flat growth in expenses.
SITI has initiated a country-wide monetization increase program in June 2018. This has resulted in a 17% increase in ARPU. The Company has also improved its subscription collection efficiency, surpassing 93% in June 2018 exit, which has further risen to 97% exit July'18.
Highlights for the first quarter ended June 30, 2018
- Operating EBITDA at Rs.549 Mn, up ~7% Q-o-Q
- Subscription Collection Efficiency surpasses 93% in June'18; 97% in July'18
- 3.5 lakh new Digital subscribers added in Q1FY19
The Company's active digital subscriber base also reached 11.7 Mn by end of the first quarter with 3.5 lakh fresh additions. The company now serves ~55 Mn+ consumers in ~580+ locations across the country. SITI's HD base also increased to 3.56 lakh by adding 41,000 subscribers in the quarter.
In preparation for the New Tariff Order, SITI is working on Smart Tiered Packaging to offer customers bespoke options and great value. This will further help SITI in implementing the New Tariff Order regime later in this fiscal. The Company has undertaken significant technological and process enhancements for its Subscriber Management System while initiating training and education modules for all stakeholders on the New Tariff Order.
As an Industry first, SITI implemented the "eMIA Initiative" to ensure digitization of agreements with all partners.
To drive employee engagement and enhance operating efficiencies, SITI launched a customized app for its employees called "My SITI". This has helped to promote a high-performance culture across the organization through real-time monitoring and evaluation of various operational and strategic parameters. With a clear focus on last mile connect, a customer engagement application is under beta testing phase which will provide real-time details of consumer package, profile information & social connect.
While commenting on the results, Mr. Rajesh Sethi of SITI Networks Limited mentioned, "SITI had a great start to FY19 with strong improvement across all operational metrics. Our "Customer First" strategy helped drive superlative 146% Operating EBITDA growth coupled with expansion of 892 bps in the margins. While we increased our Subscription Revenue nearly 26% year on year, we have further initiated an ARPU increase program and the results will be visible in the coming Quarters.
With the New Tariff Order notification, we are well positioned to move to the new regime. Our systems and processes are ready for this seismic transformation of last mile operations. In FY19, we intend to drive efficiencies along with solid EBITDA and Margins growth, in line with our core strategy of profitable and sustainable growth."
Report By: Saurabh Datta