Tata Communications delivers strong performance

Tata Communications today announces its financial results for the quarter ended June 30th, 2020

Highlights|Q1 FY2021

Data services portfolio

· Strong growth in Data business; revenue grew by +10% YoY on the back of robust performance across all segments, despite an uncertain economic environment.
· Data EBITDA was at INR 975 crore; up +32.4% YoY on the back of margin expansion of 460 Bps YoY led by cost efficiency initiatives.
· Due to lockdown and remote working, we are witnessing increased bandwidth usage and higher collaboration traffic. Enterprises have upgraded their capacities and are consuming more data to support this work model. Consequently, our India enterprise business grew by 6.7% YoY and international enterprise business grew by 8.3% YoY on the back of strong demand. This has led to increase in both revenue and profitability.
Consolidated financial highlights
· Consolidated revenue was at INR 4,403 crore; growth of +5.6% YoY on the back of strong growth in Data business.
· Consolidated EBITDA at INR 1,042 crore; increase of +26.2% YoY and margin expansion of 390 Bps on the back of strong profitable growth in data business and focus on cost efficiencies.
· Consolidated PAT at INR 258 crore as compared to a profit of INR 77 crore in Q1 FY20; growth of +236% YoY.
· CAPEX for this quarter was INR 372 crore as compared to INR 342 crore in Q4 FY20

Commenting on the results, A.S Lakshminarayanan, MD and CEO, Tata Communications, said, “We have started this new financial year with strong performance amidst an uncertain and unpredictable economic environment. Digital is increasingly defining and shaping the experiences in this new world. It will become even more strategically core as businesses look to adopt new ways of working and transform how they operate, and how they engage with their audiences and with each other. We continue to be a key partner for our customers as they look to now focus on business recovery, acceleration, and growth.

Our new proposition, Secure Connected Digital Experience, is aimed at enabling customers to adopt new digital working models by providing a holistic ecosystem of solutions that are suited for this digital-first environment and are built for the long term. We’re seeing good interest in the market for these solutions. We remain focused on our strategy to deliver profitable growth and to be a preferred digital partner to our customers.”

Commenting on the results, Pratibha K. Advani, Chief Financial Officer, Tata Communications, said, “We have registered another quarter of strong growth. Data portfolio, which has been the key driver for our business, recorded a double-digit growth of 10% YoY with robust margin expansion of 460 Bps.

Enterprise business has also shown a healthy increase in the quarter, on the back of strong growth in India as well as the international markets, with India growing by 6.7% and international by 8.3% YoY. We continue to drive cost efficiencies in our business and with every successive quarter, we are improving our financial fitness.

An investor fact sheet providing detailed analysis of the results for the quarter ended June 30th, 2020 has been uploaded on the Tata Communications website and can be accessed

Business highlights | Q1 FY2021

Customer wins:

· In Q1 FY21, we expanded our relationship with VICE Media, a digital media and broadcasting company, to manage content across all its production centres and offer immersive, high quality viewing experience to its audiences, globally. Tata Communications is providing a range of network solutions, cloud storage and a suite of Media and Entertainment solutions including Video Connect and Media Asset Management to VICE Media, enabling secure, scalable, and cost-efficient cloud-based post-production workflows for its content editors. These suite of solutions will allow VICE Media to be agile and grow its global footprint by capturing content from anywhere in the world, transferring it over a secure, hybrid network to its editors in production centres across 36 locations in Europe, US, Canada, Asia Pacific, and the UK, and broadcasting it across VICE Media channels to global audiences.

· Tata Communications is providing Petrofac, a leading international service provider to the energy industry, with a secure, global and flexible suite of enterprise-grade WAN services, consisting notably of IZO™ Internet WAN and IZO™ SDWAN, connecting their 50+ locations across the globe. IZO™ Internet WAN is a unique global Internet-based WAN service that gives enterprises the flexibility and predictability of a private network, with the global reach of the Internet. This is in addition to the Secure Web Gateway that we have been providing to Petrofac’s global users. With Tata Communications’ cutting edge software-defined and virtualised network technologies, Petrofac will now be able to leverage consistent network performance, end-to-end Service Level Agreements (SLAs) & reporting, and a future-ready network to aid cloud adoption for its existing enterprise application with predictable performance.

Awards: Best employer

· Recognised among ‘India’s Best Companies to Work For 2020’ by Great Place to Work® Institute, for fourth year in a row. · Recognised among the ‘Best Workplaces in Hong Kong™ 2020’ by Great Place to Work® Institute, for fourth year in a row

Awards: Analyst recognitions

· Eight awards at Frost & Sullivan’s 2020 India ICT Awards:
o Enterprise Data Service Provider of the Year (eleventh year)
o Enterprise Telecom Service Provider of the Year – Large Enterprise Segment (fifth year)
o Managed Multi Cloud Service Provider of the Year (third consecutive year)
o SDWAN Service Provider of the Year (third consecutive year)
o Unified Communications Service Provider of the Year (third consecutive year)
o Managed Security Service Provider of the Year – Telecom (second consecutive year)
o Cloud Interconnect Service Provider of the Year (second consecutive year)
o Video Managed Services Provider of the Year (second consecutive year)
· Omdia: Leader in Global Video CDN landscape (first year) · IDC MarketScape: ‘Major Player’ in Asia/Pacific Managed Security Services 2020 (second consecutive year) · Everest Group: Leader in Global Network Transformation & Managed Services PEAK Matrix Assessment 2020 (first year)
· Forrester: Covered in the Forrester NowTech Global as Midsize Vendor in Cloud Contact Center Vendors report (first year)
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