Du owner EITC's first-quarter profit declines
But firm 'takes a long-term view and remains focused on implementing strategy to drive more efficiency in core business'
Emirates Integrated Telecommunications Company, the parent of operator du, said first-quarter net profit slid as revenues dipped.
Net profit after royalties for the three months ending 31 March declined 12.3 per cent year-on-year drop to Dh449.4 million, the company said on Tuesday in a regulatory filing with the Dubai Financial Market, where its shares are traded. Revenue fell nearly 6 per cent to Dh3.1 billion from a year earlier.
“Industry wide challenges, with continued pressure on voice revenues and data monetisation, are reflected in our top line results,” said Osman Sultan - EITC’s chief executive - in a statement.
“We take a long-term view and remain focused on implementing our strategy to drive more efficiency in our core business, while capturing new areas of growth through ICT… as we reposition our company for the future,” said Mr Sultan.
Capex spend in the first quarter was Dh181m, up by 74 per cent compared to the same period last year, as the company is ramping up preparations for the launch of ultra-high speed mobile broadband 5G, added Mr Sultan.
The UAE’s second-largest telecom operator is aiming to roll-out 5G services this year as the telco has announced to set up more than 700 5G-enabled stations in the country by the end of this year.
According to the company, net profit increased 14 per cent year-on-year, if an exceptional one-off benefit of the first quarter of 2018 is excluded or not considered. In the first quarter of last year, EITC recorded a one-off benefit related to regulatory costs - which positively impacted the company’s profitability.
EITC, which was founded in 2005 as the UAE’s second licensed telecommunications provider, did not give a reason for the drop in revenues in the bourse filing. The company includes the du brand, launched in 2007, and Virgin Mobile, which was rolled out in 2017.
Mobile revenues dipped by 8 per cent to Dh1.7bn, while fixed line revenue registered good comparative growth, increasing 9 per cent to Dh611m during the period.
The company’s active mobile subscribers have declined over the months as the company has disconnected some mobile customers on the back of the UAE regulator’s “My Number, My Identity” campaign.
Basic and diluted earnings per share amounted to Dh0.10 - a yearly decrease of nearly 9 per cent.
EITC is 39.5 percent owned by Emirates Investment Authority, 19.75 percent by Mubadala Investment Company, 19.5 percent by Emirates International Telecommunications and the remaining by public shareholders and national organisation.
Updated: April 24, 2019 08:52 AM