Q3 FY2014 Net Revenue remained steady and EBITDA declined by 12.0% q-o-q

BANGALORE, India – January 28, 2014: OnMobile Global (“OnMobile”) today announced the results for the Third Quarter FY2014 ended December 31, 2013. Revenue for Q3 FY2014 was Rs. 2,255 million, an increase of 28.0% y-o-y and 0.2% q-o-q. This includes financials of OnMobile Live (OLI).

Highlights:

• Challenging quarter in terms of revenue growth
• Latin America:
  • Revenue increased 14.6% y-o-y, however declined 10.6% q-o-q
  • Impacted by technical issues affecting all core and VAS services during the first half of Q3: issues since resolved and monthly run rate back to normal
  • Revenue share declined, driven by volume of business, as per contract
• India:
  • Revenue declined 17.1% y-o-y, however increased 3.2% q-o-q
  • Revenues stabilized after a long period of decline
• Other Emerging Markets:
  • Revenues recorded growth of 4.3% y-o-y and decrease of 7.6% q-o-q
  • Softness in Bangladesh owing to local political situation
  • Bangladesh:
    • Launched RBT services with another operator in the country
    • Signed a contract with another top operator for RBT services
• Europe:
  • Continued robust growth with revenues increasing 128.4% y-o-y and 9.7% q-o-q, driven by CVAS offering

Financials excluding OnMobile Live:

Q3 FY2014 vs. Q3 FY2013: Y-o-Y Highlights (excluding OnMobile Live)

• Net Revenue of Rs. 2,043 million, up 16.0% as compared to Q3 FY2013
• International businesses increased by 34.4% to Rs. 1,521 million and contributed 74% of the Net Revenue in Q3 FY2014 (vs. 64% in Q3 FY2013)
  • International revenue was primarily driven by Europe and Latin America
  • Latin America impacted by technical issues regarding core and VAS services in Brazil during the first half of Q3 – issues since resolved and monthly run rate back to normal
• EBITDA decreased by 22.8% to Rs. 338 million and Net Profit declined by 85.7% to Rs. 30 million
  • Primarily on account of the one-time impact of minimum guarantee of Rs. 144 million (7.0% of revenues), for a contract in Europe
  • Opex rationalization measures resulted in savings in the quarter
• Effective Tax Rate for the quarter (ETR) stood at 26.0%
• Earnings per share was Rs. 0.24 as against Rs. 1.81 in Q3 FY2013

Q3 FY2014 vs. Q2 FY2014: Q-o-Q Highlights (excluding OnMobile Live)

• Net Revenue declined by 1.2%
  • International revenues decreased 2.7% as compared to Q2 FY2014 – softness in Latam, Egypt and Bangladesh
  • Domestic revenues witnessed stability and grew 3.2%
• EBITDA decreased by 6.0% to Rs. 359 million and Net Profit declined to Rs. 30 million
  • Primarily on account of the one-time impact of minimum guarantee of Rs. 144 million for a contract in Europe
  • Normalized for forex impact, Net Profit increased by 48.4% to Rs. 72 million
• Net Cash increased from Rs. 254 million to Rs. 801 million
• Earnings per share was Rs. 0.24 as against Rs. 0.85 in Q2 FY2014

OnMobile Live Update:

• Final stages of integration and migration in progress – revenue run-rate of Q2 maintained
• EBITDA burn for Q3 was marginally higher at USD 0.7 million on account of separation cost of USD 0.2 million – OPEX optimization measures on track

About OnMobile

OnMobile [NSE India: ONMOBILE], headquartered in Bangalore, India, and with offices in all regions of the world, delivers millions of music plays daily to mobile customers worldwide. Based on current deployments, OnMobile has the potential to reach more than 1.1 billion mobile users across several geographies. For further information, please visit www.onmobile.com

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pr@onmobile.com