The Indian arm of Norwegian telecom firm Telenor has posted an operating loss of 3226.31 crore in the third quarter ended September 30, hit by a massive loss due to impairment of its licenses. It had posted an operating loss of 299.52 crore in the same period a year ago.
Based on recent observations in the Indian market, the fair value of the licenses in Telenor India has been assessed, resulting in an impairment loss of NOK 4 billion (3192 crore). The company has indicated its possible exit from India business due to high spectrum cost that leads to high investment and low returns.
During the first nine months of 2016, Telenor said it has identified an impairment amounting to 5346.6 crore related to tangible and intangible assets in Telenor India.
In addition, Telenor has written down 478.8 crore in non-interest-bearing receivables during the first quarter of 2016.
During the 9 months of 2016, total impairment loss and write downs related to Telenor India of NOK 7.3 billion (5825.4 crore) were recognized. Revenues in local currency increased by 12 percent compared to the same quarter last year. Subscription and traffic revenues in local currency increased by 10 percent. However, as per reported Norwegian Krone numbers, the revenue growth was 8.8 percent. Telenor, however, said that its EBITDA margin increased by nearly one percentage point to 38 percent as a result of high revenue growth and strong margins in Bangladesh as well as improved performance in India.