Axiata Group has posted its unaudited interim financial results for Ncell and its other subsidiaries for the second quarter of 2023 which ended 30 June. During this period, the group’s Nepali venture Ncell Axiata generated over 9 arab in revenue as data continues to be more influential for its business.
The private telco posted 9 arab, 76 crores, and 99 lakhs in its revenue for Q2, 2023 which is a positive trajectory from the first quarter report. However, It’s a year-to-year decrease of 69 crores, 56 lakhs, and 80 thousand compared to the same period from the last fiscal year FY 2022. In the second quarter of FY 2022, Ncell filed 10 arab, 46 crores, 55 lakh, and 80 thousand in total revenue.
| Ncell revenue, Q2 FY 2023 | Ncell revenue, Q2 FY 2022 | Difference |
| 9,76,99,00,000 | 10,46,55,80,000 | 69,56,80,000↓ |
At the same time, the company’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) reached 5 arab, 59 crores, 24 lakhs, and 10 thousand. 5,59,24,10,000 at a margin of 57.2%. EBITDA is one of the primary ways to look into the company’s ability to generate cash.
Ncell profit (PATAMI) increases in Q2, 2023
Ncell’s PATAMI (Profit after Tax, and Minority Interest) slightly increased over the same period from last year. In Q2, 2023, The company posted PATAMI of 1 arab, 28 crores, 95 lakhs, and 40 thousand at an increased margin of 13.2%. Last year, the same figure stood at 1 arab, 16 crores, and 93 lakhs which is an increase of 12 crores, 2 lakh, and 40 thousand with an 11.2% margin.
| EBITDA | PATAMI |
| Rs 5,59,24,10,000 | Rs 1,28,95,40,000 |
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Operating costs of Ncell, second quarter, 2023
Ncell’s direct operating costs reached 4.83% or Rs 47 crores, 18 lakhs, 86 thousand, and 170 against its total revenue for the same period. The network cost surpassed 15% or Rs 1 arab, 55 crores, 14 lakhs, 60 thousand, and 120.
The company’s direct operating costs, however, decreased from last year as it reached Rs 4 arab, 17 crores, 76 lakhs, 9 thousand, and 240 of 42.76%. In Q2, 2022, Ncell’s direct operating cost was 46.3% against its total revenue which was Rs 4 arab, 84 crores, 55 lakhs, 63 thousand, and 540.
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ARPU sees growth
During the same period, the leading private operator saw its average revenue per user or ARPU rise for both prepaid and post-mobile services. While not all the indicators are shining for the leading telco, positive ARPU is an encouraging takeaway. For postpaid and prepaid, Ncell registered Rs 264 and Rs 186 in ARPU respectively in Q2, 2023. During the same period in FY 2022, the company’s ARPU stood at Rs 258 and Rs 197 respectively marking an increase in postpaid ARPU by Rs 6 while prepaid ARPU fell by Rs 11 between the same three months between two fiscal years.
| ARPU, Q2 FY 2023 | ARPU, Q2 FY 2022 | Difference |
| Rs 264 in postpaid | Rs 258 in postpaid | Rs 6↑ |
| Rs 186 in prepaid | Rs 197 in prepaid | Rs 11↓ |
Data contribution rises to Ncell’s finances
Data is a veritably key factor for telcos’ earnings and it’s no exception with Ncell. As the report shows, a total of 33.07% contribution came from data for its total revenue which is Rs 3 arab, 23 crores, 9 lakhs, 5 thousand, and 930. During the same period, data traffic soared exponentially reaching 126.37 million GB with each user consuming 4528.82 MB of Ncell data per month. The per-user/month data usage has continuously grown for the telco in the past quarters. In FY 2022, Q2, an average of 3251 MB of data was used by each user per month. Likewise, in the first quarter of 2023, per-user/month data usage was 4150.26 MB. Find all: Latest Ncell data packs | 2023
| Total data traffic | Per user data consumption | Data contribution to the revenue |
| 126.37 (million GB) | 4528.82 MB per user/month | 33.07% |
The report shows that Ncell has 73% of its subscribers are on smartphones. The company operates 3,239 3G and 4,148 4G cell towers till 30 June 2023. Check out: Ncell installed 338 mobile towers in FY 2022/23, improved mobile services, including 4G capacity
Axiata Group’s steady Performance but challenges in Ncell
Despite some positive financial growth in comparison, the telco continues to face challenges to keep its earnings on an encouraging trajectory. Axiata Group, the parent company attributed this to insufficient data growth to counter losses from voice. Axiata said:
Ncell in Nepal continues to face challenges as data growth has not been sufficient to offset the declining voice segment, impacted by lower interconnection rate and minutes of usage (MoU).
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In fact, Axiata Group has witnessed steady financial performance in the first half of 2023 generating double-digit growth in revenue and EBITDA thanks to all operating companies except ADA and Ncell in Nepal.
Ncell, like other mobile network operators (MNOs), has been facing financial strains in recent years with the voice segment seeing a gradual decline in usage. The cheaper data packs, lower interconnection rates, and cut-throat competitiveness have also affected overall financial well-being.
