RCom Posts Profit Jump

Mumbai, May 26, 2012: Reliance Communications Limited (RCOM) today announced its consolidated financial results for the quarter ended March 31, 2012.

Highlights of the financial performance for the quarter are:

- Revenue at Rs. 5,310 crore, up 5% from Rs. 5,055 in Q3.

- EBITDA at Rs. 1,632 crore, up 1% from Rs. 1,614 crore in Q3. EBITDA margin at 30.7%, amongst the highest in the industry, with strong contribution from both Wireless and GEBU businesses.

- Net Profit at Rs. 332 crore, up 78% from Rs. 186 crore in Q3.

KEY HIGHLIGHTS:

1. Consolidated Revenue & EBITDA: RCOM Q4 total revenues at Rs. 5,310 crore, up 5% from Rs. 5,055 crore in Q3. Q4 EBIDTA at Rs. 1,632 crore, with EBITDA margin of 30.7% amongst the highest in the industry. Clear focus on profitable businesses, now delivering consistent EBITDA margins in the industry.

2. Wireless Revenue & EBITDA: Q4 wireless revenue up 4.3% from Q3 on comparable basis. Q4 wireless EBITDA up 13% from Q3 on comparable basis. RCOM is focused on profitable growth through innovative product portfolio, superior network experience and customer centric approach.

3. RPM: RPM stood at healthy 43.6 paisa. We have successfully achieved RPM stability for the last 8 consecutive quarters amidst increasing competition and over supply of minutes in market place. Our total RPM drop over last 8 quarters has been 1% vs. significantly higher drop in the industry.

4. Global Enterprise (GEBU) Revenue & EBITDA: Q4 Revenues at Rs. 2,440 crore, up by 3.7% from Rs. 2,352 crore in Q3. Q4 EBIDTA at Rs. 589 crore, up by 3.5% from Rs. 569 crore in Q3.Q4 EBITDA margin stands at 24.2%.

5. RCOM continues to be free cash flow positive. RCOM generated operational cash flow (EBITDA) of Rs. 1,632 crore in Q4. Post payment of 3G auction fees and with peak capex behind us, this is the first full year of positive free cash flow (FCF) for the company and this trend will continue in succeeding years.

6. RCOM has tied up with Android: RCOM announced its plans to exclusively market Android devices in India over its superior network for the next 2 years. Through this strategic collaboration with Google, RCOM will market the Android mobile operating system and Google Mobile Services in order to promote the usage of Android devices in the country.

In line with other such collaborations in mature markets like USA, Japan and Australia, Google has associated with RCOM to leverage the pan India high quality Reliance network, especially the superior Reliance 3G network along with the fastest growing Android mobile platform to deliver leading-edge mobile applications, services and devices.

7. RCOM launched Indias first GSM and CDMA Tablet: RCOM became the first GSM and CDMA operator in India to enter the Tablet space by unveiling its Reliance 3G Tab and Reliance CDMA Tab, a fully loaded Android tablet. With this launch, Reliance not only emerges as the first telecom operator in India to offer Tablets on both the 3G and CDMA Both the tablets are stylish and comes with a 7-inch capacitive touch screen with Android 2.3 OS. Loaded with 512 MB RAM and a micro SD external storage, it is sure to appeal a large segment of value conscious Indian consumers. The light weight (under 400g) Reliance Tab comes with a 2.0 MP rear camera and a front camera, among other key features, catering to both business users as well as the youth segment. The Reliance CDMA Tab is supported by Reliances CDMA network across 22 circles in over 1000 towns in the country. The devices are priced attractively at Rs. 12,999 and are further bundled with attractive monthly and annual data plans.

8. RCOM paid redemption amount of US$ 1,182 Mn to redeem outstanding FCCBs: RCOM refinanced its outstanding FCCBs by entering into an agreement with Industrial and Commercial Bank of China Ltd. (ICBC), China Development Bank Corporation (CDB) and Export Import Bank of China (EXIM) for redemption of its outstanding FCCBs (Foreign Currency Convertible Bonds). The outstanding FCCBs of US$ 1,182 million (approximately Rs. 5,825 crore) were redeemed on the due date of March 1, 2012. RCOM will benefit from extended Loan Maturity of 7 years and attractive interest cost of about 5%. This is the largest refinancing in the history of FCCBs by any Indian Corporate.

9. TRAI Quality of Service Report: As per TRAI QoS report published in April, 2012; RCOM has met TRAIs QoS criteria in ALL the 22 circles. TRAI has rated RCOMs network as No.1 in 18 out of 22 circles for Lowest Call Drop Rate across operators and also rated amongst Top 3 in 18 out of 22 circles for Best Call Set-up Success Rate.

10. Recent Rewards & Recognition:

May 2012 - Reliance was awarded TM Forum Global Excellence Award 2012 Business Innovation, in Dublin - Ireland this year. This award was conferred for 3G Video on demand innovative platform - demonstrating the most innovative and successful new service or business model.

April 2012 - Top Green IT Enterprise Award 2012 instituted by IDG Media in recognition of our contribution towards green and clean environment.

March 2012 - CIO Grand Masters Virtualization award for operational agility, resources flexibility through eco-friendly initiatives to deliver responsive, reliable & continued service.

11. RCOM has announced that it is evaluating a potential initial public offering and listing in Singapore of its subsea telecommunications infrastructure network business, through a Singapore business trust.

Reliance Communications Ltd.