Etisalat earnings decline as it loses mobile customers

Etisalat says it has lost mobile subscribers and has posted revenues and net profits that are short of analyst expectations. In a filing to the Abu Dhabi Securities Exchange, the UAE's largest telecommunications operator reported a net profit of Dh1.99 billion (US$541.8 million) in the first quarter of this year on revenues of Dh7.94bn. In the first quarter of last year, it posted a net profit of Dh2.17bn.

Etisalat said it had 7.71 million mobile subscribers, slightly down from the previous three months where it reported 7.74 million. The company also lost 10,000 fixed-line subscribers, but added 50,000 internet users in its domestic market. Simon Simonian, a telecoms analyst with Shuaa Capital, expected Etisalat to report Dh7.51bn in revenues and Dh2.1bn in net profit. But Etisalat said its revenues for the latest period were up 5 per cent, or Dh379m, compared with the same quarter last year.

The company is expected to report detailed figures on Wednesday. The country's second-largest telecoms operator, du, is expected to report its first-quarter figures within weeks. In a research note this month, Mr Simonian said Etisalat's bottom line in the latest quarter would be boosted by the absence of start-up costs related to the launch of its Indian subsidiary. The company recently started a mobile service in India under the Cheers Mobile brand and is participating in the country's auction of its 3G wireless spectrum after submitting a deposit of 4.27 billion rupees (Dh352.2m).

"We are expecting flat year-over-year revenue and [earnings before interest, taxes, depreciation and amortisation] for UAE operations," Mr Simonian said. dgeorgecosh@thenational.ae