Bharti Airtel registers 41% decline in net profit

Bharti AirtelBharti Airtel has registered a 41% drop in its net profit for the quarter ended December 31, 2010. This plunge is due to one time-brand development costs and foreign exchange losses. Last year during same period, company had posted the net profit at Rs. 2195 crore against Rs 1,303 crore in the Q3 of current year.

India's largest cellular operator by subscriber number, said that last year the company has undertaken a huge rebranding exercise of Rs 340 crore . As a result of the brand relaunch, its sales and advertising cost shot up by almost 50% from the last year to Rs 1,939 crore. In addition to brand relaunch, it suffered losses of Rs 303 crore on account of foreign exchange.

The company said that last year it has acquired Africa’s business of Zain for $ 10 billion and adverse currency movements in Africa and India has affected the mobile operator’s profits and finally resulted in losses of Rs 151 crore in Q3.

Due to rebranding exercise, it recorded a rise in sales by 53% at Rs 15,756 crore from Rs 10,305 crore sales of last year. The mobile operator’s overall subscriber base stands at 207.8 million across 19 countries. During the third quarter license and spectrum fees also strikes the doors of the mobile operator. Bharti’s shares closed at Rs323.25 on BSE.