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RCom Q3 net slips 43% on finance costs

By Religare
RCom Q3 net slips 43% on finance costs
Anil Dhirubhai Ambani led Reliance Communications (RCom) has reported the bigger-than-expected decline of 43 per cent in net profits for third quarter ended December 2012 at Rs 105 crore, as rising finance costs weighed upon the earnings.

The net profit of the company stood at Rs 186 crore during the same period a year ago, said RCom in a filing to the BSE on January 23, 2013. Analysts had expected the profit to fall to around Rs 183 crore.

"This is due to increase in finance charges for refinancing foreign currency convertible bonds (FCCBs) with interest-bearing loans," said Gurdeep Singh, president and chief executive officer of the wireless business at RCom. Net debt was Rs 37,361 crore.

The company had refinanced a couple of FCCBs repayments last year. First tranche of FCCBs worth USD 1.1 billion was refinanced in February last year while another worth USD 500 million in May 2011.

Besides, the revenues of the company rose 5 per cent to Rs 5,301 crore year-on-year while EBITDA grew 2.4 per cent to Rs 1,614 crore year-on-year.

Revenue per minute or RPM stood at 44 paise during the three months to December 2012.

"We have successfully achieved RPM stability for 11 consecutive quarters, amidst increasing competition and oversupply of minutes in the market place," said RCom in a statement.

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