Mumbai, India – May 31, 2010: Tata Communications, a leading global provider of a new world of communications, reported its consolidated financial results under Indian GAAP for the year ended March 31, 2010. Consolidated revenues increased by 10.7 % to Rs 11,026 crores (about $2.32 Billion) from Rs. 9,963 crores in the previous year.
The company’s operating profit (EBIDTA) was Rs 1,012 crores for 2009-10 as against Rs 1,366 crores for the previous year. The company reported a net loss of Rs 598 crores for 2009-10. The consolidated net loss for the year includes a loss of Rs 464 crores for the company’s holding in Neotel, South Africa. The company’s shareholding in Neotel was at an effective 49.01 % for the full year as against 22.01% for a significant period of the previous year. The consolidated net loss also includes increases in other non-cash costs, depreciation by Rs 409 crores (consequent to significant amount of capitalization done over the last two years) and provision for retirals by Rs 161 crores (consequent to changes in actuarial assumptions for our overseas subsidiaries and amendments in the gratuity provisions in India).
The Board of Directors has recommended that no dividend be payable this year.
Tata Communications continued to invest in achieving its vision and strategy. A strong focus on expansion and long-term investment has seen the company reinvest its cash in the business in expanding its presence and capabilities in India and all key international markets. With economic conditions improving across the world and technology playing an important role in post-revival business strategies, the company anticipates strong demand across most of our market segments.
The company reported continued growth in its core wholesale voice as well as enterprise data services business. During the year, Tata Communications signed a landmark five year agreement with BT Group through which Tata Communications became BT’s primary supplier of International Direct Dial (IDD) and other voice termination services outside BT’s own footprint countries and BT became Tata Communication’s main distribution channel for its IDD traffic into the UK. Tata Communications also entered into an agreement to acquire the Mosaic business of the BT Group which enhanced the company’s capabilities in the digital media & entertainment space. During the year the company continued its rollout of Telepresence public rooms through tie –ups with Starwood Hotels and Carlson & Wagonlit Travels.
During the year, Tata Communications completed the construction of its new 6700km, 3.8 Tbps TGN-Intra Asia submarine cable system connecting Singapore, Hong Kong, Japan, Vietnam and the Philippines. Tata Communications also began work on the TGN-Gulf submarine cable system which will be completed during 2011, and will connect the middle-eastern region to the rest of the world via the Tata Global Network (TGN), providing reliable high speed bandwidth to all the key cities of the world. The company also announced the availability of new capacity connecting Asia and South Africa as well as investment in a new cable system on the west coast of Africa.
* * *
About Tata Communications
Tata Communications is a leading global provider of a new world of communications. With a leadership position in emerging markets, Tata Communications leverages its advanced solutions capabilities and domain expertise across its global and pan-India network to deliver managed solutions to multi-national enterprises, service providers and Indian consumers.
The Tata Global Network includes one of the most advanced and largest submarine cable networks, a Tier-1 IP network, with connectivity to more than 200 countries across 400 PoPs, and nearly 1 million square feet of data center and collocation space worldwide.
Tata Communications’ depth and breadth of reach in emerging markets includes leadership in Indian enterprise data services, leadership in global international voice, and strategic investments in operators in South Africa (Neotel), Sri Lanka (Tata Communications Lanka Limited), and Nepal (United Telecom Limited).
Tata Communications Limited is listed on the Bombay Stock Exchange and the National Stock Exchange of India and its ADRs are listed on the New York Stock Exchange. (NYSE: TCL) www.tatacommunications.com
Forward-looking and cautionary statements
Certain words and statements in this release concerning Tata Communications and its prospects, and other statements, including those relating to Tata Communications’ expected financial position, business strategy, the future development of Tata Communications’ operations, and the general economy in India, are forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors, including financial, regulatory and environmental, as well as those relating to industry growth and trend projections, which may cause actual results, performance or achievements of Tata Communications, or industry results, to differ materially from those expressed or implied by such forward-looking statements. The important factors that could cause actual results, performance or achievements to differ materially from such forward-looking statements include, among others, failure to increase the volume of traffic on Tata Communications’ network; failure to develop new products and services that meet customer demands and generate acceptable margins; failure to successfully complete commercial testing of new technology and information systems to support new products and services, including voice transmission services; failure to stabilize or reduce the rate of price compression on certain of the company’s communications services; failure to integrate strategic acquisitions and changes in government policies or regulations of India and, in particular, changes relating to the administration of Tata Communications’ industry; and, in general, the economic, business and credit conditions in India. Additional factors that could cause actual results, performance or achievements to differ materially from such forward-looking statements, many of which are not in Tata Communications’ control, include, but are not limited to, those risk factors discussed in Tata Communications’ various filings with the United States Securities and Exchange Commission. These filings are available at www.sec.gov. Tata Communications is under no obligation to, and expressly disclaims any obligation to, updates or alters its forward-looking statements.
+ 91 9223306610
Vaishnavi Corporate Communications