In its first full quarterly results since its merger, Vodafone Idea has announced that it is integrating its networks more quickly than anticipated.
The operator, created in August 2018 by the merger of Vodafone India and Idea Cellular, expects to achieve certain business synergy goals two years ahead of schedule. It reported that while it has seen strong progress across all aspects of combining the two businesses, the market difficulties that led to the operators merging persist.
Despite its progress, its earnings presented some concerning statistics. Vodafone Idea registered a loss of INR50 billion ($699 million) in its fiscal Q3 2019 (ending 31st December 2018) – significantly more than the combined INR14 billion loss that can be extrapolated from the results of Vodafone India and Idea Cellular in the same quarter of 2017.
However, Vodafone Idea claimed that these losses cannot be fairly compared as it incurred several one-off expenses in its first quarter as an operator, including INR7.43 billion on costs related to its merger and INR350 million on network realignment.
Additionally, Vodafone Idea expects that these expenses will be offset by sooner-than-anticipated savings related to operational synergies. It now anticipates savings of INR84 billion for its 2021 fiscal year, two years sooner than it forecast at the time of announcing the merger in March 2017.
The operator claims to have aligned tariffs across the brands of its constituent businesses, and will “shortly” finish integrating its retail operations, customer service management and distribution channels. CEO Balesh Sharma said: “We are moving faster than expected on integration, specifically on the network front, and are well on track to deliver synergy targets.”
