Du doubles Q1 profit; revenue rises to Dh2b

DUBAI — UAE telecom operator Emirates Integrated Telecommunications Co, popularly known as du, said on Monday that it doubled its profit in the first quarter as it gained 41 per cent of the domestic mobile market.

By Issac John

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Published: Tue 26 Apr 2011, 11:39 PM

Last updated: Tue 7 Apr 2015, 3:35 AM

Du Chief Executive Officer Osman Sultan said the company achieved revenues of Dh2 billion in the first quarter against Dh1.58 billion in the same period a year earlier.

He said du expects revenue to grow 20 per cent in 2011 as the company forecasts a nationwide rollout of its services before the end of the year.

Sultan said the company is already in advanced testing of its services outside of its traditional geographical footprint.

The telecoms operator added 272,000 active mobile subscribers in the first three months of the year, bringing the total subscription to 4,604,800. It invested Dh477 million in infrastructure during the period.

The first-quarter net profit, after providing for royalties, surged to Dh205.8 million from Dh97.1 million in the year-earlier period, from Dh97.1 million in the year-earlier period, slightly exceeding a forecast of Dh203.7 million.

“Year-on-year growth remains strong and we enter the year in a robust position,” Sultan said in a statement to the Dubai bourse. “We have continued to attract new customers; indeed, we added more customers than any of the quarters in 2010.”

Sultan claimed that du has the highest growth rate in the region among all telecoms operators. Du’s rival etisalat, the Middle East’s largest telecoms firm by value, posted an 8.9 per cent drop in quarterly profit. Last week, it reported a first-quarter profit of Dh1.82 billion.

He said the company’s growth momentum would continue this year in both fixed-line and mobile services, with no interruption seen in BlackBerry usage as a result of a change in security policies implemented by the Telecommunications and Regulatory Authority.

He said du would also continue to provision for royalty payments to the government at 50 per cent of its profits “until it is advised by the government on the rate for the year.”

“It is healthy to be conservative in order to have no surprises,” he said.

The operator paid a 15 per cent royalty fee to the government in 2010.

Sultan said the company is also in advanced discussions with banks to refinance part of a Dh3 billion loan maturing in June as it weighs its refinancing needs for development going forward.

“We will not be going out seeking the totality of the Dh3 billion loan,” he said. “Discussions are happening with banks to see how we can refinance these needs,” he said.

· issacjohn@khaleejtimes.com



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