Sustainability & National Contribution Report 2016

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Key Highlights

  • Subscriber growth of 14.4% to 14.9 million

  • 2016 net addition of 1.8 million

  • Data subscriber growth of 22% to 6.02 million

  • Rebranded as “Ncell, an Axiata company” in August 2016

  • Successfully completed integration into the Group in April 2016

About Ncell

Ncell Private Limited has been in operations in Nepal since 2004 as the first private mobile service provider in the country. The Company is committed to being the best local mobile providing international quality services with a local touch. Most of the employees of Ncell are Nepali and its services are designed to meet the needs of local society.

Ncell is constantly working towards its goals of connecting everyone in Nepal through its network, providing high quality, modern and cost effective services, and creating value for its customers and partners.

Contributing to the development of the country’s economy and infrastructure, Ncell builds best-in-class networks and brings communication services to people living in the most remote areas of Nepal.

Business Review 2016

In 2016, Ncell maintained its leading position in the Nepalese mobile market. The Company’s subscriber base grew by 14.4% Year on Year (YoY) to reach 14.9 million subscribers.

Data revenue contributed 16% of total revenue during the year, representing data revenue growth of 70.3% YoY, driven by 116.2% growth in data volume.

Ncell’s 3G population coverage increased compared to the previous year, reaching 29.6% as at end of December 2016.

One of the Company’s top priorities within the telecommunications service industry is its focus on enhancing customer experience. Reflecting its sustained efforts in this area, Ncell achieved the highest Net Promotor Score (NPS) score in Nepal in 2016 in comparison to its competitors.

Throughout the year, the Company continued to provide quality services at affordable rates with attractive voice and data services. Among the new products and services launched were Day Voice Pack and Day Data Pack, Every Customer is a Winner and Dobbar Paisa Back which garnered positive results from customers as well as increased its competitive strengths within the Nepalese telco industry.

Innovative new services were launched in 2016, which included the Mobile TV Pack application enabling customers to watch live TV on mobile devices at an affordable rate. The Video on Demand (VOD) service, the first to be launched in the Nepal market, marks a key milestone for Ncell.

A total amount of NPR9.59 billion in capital expenditure was capitalised at end 2016. Ncell’s focused strategic investments significantly impacted its network coverage as well as quality, and contributed towards revenue growth in the Company.

Moving into 2017, Ncell will continue to focus on extending its data leadership as a key growth driver, by maintaining voice and international long distance revenue contributions, expanding its digital services portfolio, and putting greater emphasis on operational efficiency to ensure profitability and maximising shareholders’ value. At the same time, Ncell is committed to offer the highest standard of service to its customers by embracing its core values of trust, innovation and affordability throughout its delivery chain.

Financial Performance

In 2016, Ncell recorded revenue of NPR58.652 million, signifying an increase of 2.4% YoY on the back of outgoing voice revenue increasing by 7% and data revenue growth of 70.3%. This was achieved in spite of lower incoming international long distance revenue contribution of 17% YoY.

EBITDA and PAT increased by 2.3% and 7.7% respectively, mainly due to higher revenue as well as lower operational expenses achieved through effective cost management initiatives.

  • Revenue

    +2.4%

    • 57,260


      2015

    • 58,652


      2016

    NPR Million

  • EBITDA & EBITDA Margin (%)

    +2.3%

    • 36,823

      64.3%

      2015

    • 37,659

      64.2%

      2016

    NPR Million

  • PAT

    +7.7%

    • 18,836


      2015

    • 20,297


      2016

    NPR Million

  • Subscribers

    +14.4%

    • 13,039


      2015

    • 14,917


      2016

    Thousand

  • Blended ARPU

    • 370


      2015

    • 346


      2016

    NPR per Month

  • Blended MoU (Per Sub Per Month)

    • 127


      2015

    • 146


      2016

    Minutes of use/sub/month

Outlook for 2017

Moving into 2017, Ncell is committed to maintaining its leadership position in the Nepalese mobile market by continuously providing superior customer experience through network expansion and modernisation, as well as the introduction of an innovative range of products and services.

The Company’s key focus will be on generating sustainable revenue streams by maintaining voice segment growth, stabilising the international long distance business and aggressively driving growth in data revenue contribution. Introduction of 4G services in the future as well as data-led pricing will enable the company to enhance its data leadership position in the market as well as gaining competitive advantage amidst rapid shift in the consumption pattern from voice to data.

In 2017, Ncell will place greater emphasis on sustainably generating its next wave of growth via digital services offerings and developing the ecosystem to support it. The Company will also focus on the digitalisation of its core functions to increase operational efficiency and effectiveness. The resultant effect would be a more robust delivery chain, better equipped to face continuous market pressure on its profitability.