July 26, 2018 / 12:32 PM / 4 months ago

UPDATE 1-India's Bharti Airtel posts surprise Q1 profit on tax write-back

* Co posts surprise Q1 profit

* Tax write-backs of 18.44 bln rupees

* One-time losses at 3.62 bln rupees (Adds background on sector, details on exceptional items)

July 26 (Reuters) - India’s Bharti Airtel Ltd posted a surprise first-quarter profit helped by a tax write-back, though a pricing war in the country’s telecoms sector continued to weigh on the mobile carrier’s bottomline.

Profit fell 73.5 percent to 973 million rupees ($14.17 million) for the quarter ended June 30, compared with 3.67 billion rupees a year earlier, the company said in a statement here on Thursday.

Exceptional items for the quarter rose to 3.62 billion rupees, including a charge of 1.65 billion rupees towards operating costs for network upgrades and re-farming - the process of re-allocating spectrum.

Analysts, on average, expected a net loss of 3.08 billion rupees, according to estimates by Thomson Reuters I/B/E/S.

However, tax write-backs of about 18.44 billion rupees helped Airtel turn in a profit for the quarter.

Last year, India’s telecoms regulator cut interconnect usage charges - the fees that mobile operators pay each other for calls from one network to another - impacting revenues of operators including Airtel.

The firm’s revenue from mobile services in India fell 18.8 percent to 104.80 billion rupees, while overall revenue fell about 9 percent to 200.80 billion rupees.

The sector has seen an upheaval since the entry of Reliance Jio, the telecoms arm of Reliance Industries Ltd, in late 2016.

$1 = 68.6700 Indian rupees Reporting by Chris Thomas in Bengaluru; Editing by Adrian Croft and Vyas Mohan

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