Bharti Airtel defers September quarter results till 14 November citing AGR issue; shares slide over 4%

Telecom operator Bharti Airtel on Tuesday said it has deferred September quarter result announcement till 14 November, due to the adjusted gross revenue (AGR) issue.

The company was earlier scheduled to approve and release its Q2 numbers on Tuesday.

The New Delhi-based company’s board, which met earlier in the day, accepted the management’s recommendation to shift the September-quarter results to 14 November, the telecom operator said in a statement here filed to the stock exchanges.

Bharti Airtel, which was due to announce its Q2 results today, defers it till November 14. @airtelnews requests @DoT_India's support to deal with the adverse outcome w.r.t. adjusted gross revenue (ADR) pic.twitter.com/CKtw2yVnIg

— CNBC-TV18 (@CNBCTV18Live) October 29, 2019

“…the management of the company recommended to the board of directors that the agenda item related to the approval of audited financial results for the second quarter and half year ended 30 September, 2019… be deferred till 14 November, 2019, on account of the fact that more clarity is needed on the AGR matter arising out of recent judgement of… the Supreme Court,” Airtel said in a regulatory filing.

The company’s shares were down 4.4 percent on the BSE today. It was among the top losers.

The Sunil Mittal-led company said it is approaching the Department of Telecom (DoT) to seek clarity on the total amounts involved and “request for their support to deal with this adverse outcome,” a PTI report said.

“The board of directors, in its meeting held today (Tuesday), has accepted the management’s recommendation and deferred the agenda item relating to the approval of the said financial results till Thursday, 14 November, 2019,” the filing said.

All other agenda items shall be taken up by the board in the meeting to be resumed today in the ordinary course, it added.

Sunil Mittal knocks govt doors

Mittal on Monday came knocking at the doors of top government officials including Telecom Minister Ravi Shankar Prasad , over billions of dollars in statutory dues like spectrum and licence fee liability that his and other telcos had not fully provisioned in their accounts.

Sources said Mittal first met Prasad and then Telecom Secretary Anshu Prakash, apparently over the liability that arises from the Supreme Court upholding government’s view on how revenues should be calculated for sharing of statutory dues.

Delivering its verdict, the Supreme Court had on 24 October upheld government contention that non-core revenue in telecoms groups should be included in adjusted gross revenue – the figure on which statutory levies are charged.

Sources said the telecom operators are looking at the government for a possible relief such as waiver of penalties and interest though the Supreme Court had categorically stated that companies must pay many years worth of charges plus interest and penalties.

Ideally, companies are required to make provisions in their books for any potential liability that may arise from a legal dispute.

Airtel, Vodafone-Idea and other telecom operators may have to pay the government a whopping Rs 1.4 lakh crore following the Supreme Court order last week that sent shock waves through an industry already grappling with billions of dollars in debt and an intense tariff war to retain customers.

The top court had upheld the government’s position on including revenue from non-telecommunication businesses in calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer.

According to the DoT’s calculations, Bharti Airtel faces a liability of around Rs 42,000 crore after including licence fees and spectrum usage charges, while Vodafone-Idea may have to pay about Rs 40,000 crore. Jio may have to pay around Rs 14 crore.

--With inputs from agencies