Etisalat profit leaps 70 per cent

Etisalat 2013 profits were at Dh7.08 billion as demand for data surged. However, international operations face pressures.

Etisalat achieved net profit of Dh1.45 billion in the three months to December 31, 2013, according to Reuters calculations. Ryan Carter / The National
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Etisalat, the country's biggest telecoms company, has recorded a 70 per cent leap in fourth-quarter profit.

The company achieved net profit of Dh1.45 billion in the three months to December 31, according to Reuters calculations.

Full-year profits reached Dh7.08bn compared with Dh6.74bn a year earlier.

“Etisalat’s revenues rose from Dh32.95bn in 2012 to Dh38.85bn in 2013, but more than half of that increase was due to the consolidation of Etisalat’s operation in Pakistan – that is to say the Pakistan unit was included in the 2013 results, but not in 2012,” said Matthew Reed, an analyst at Informa Telecoms and Media in Dubai.

“One clear, positive development is that Etisalat’s revenues in the UAE rose from Dh23.89bn in 2012 to Dh25.96bn in 2013, probably due quite largely to the improving economic conditions in the country.”

Etisalat, which had previously focused on international expansion, is now concentrating on developing its domestic market, where a boom in smartphone handset sales is helping to drive revenue growth.

Etisalat has faced some challenges in international markets such as Egypt, where a weakening currency has hit revenues. The company’s operations in Tanzania and Sri Lanka are also facing competitive pressures. Etisalat operates in 15 markets. Reuters said Etisalat’s Dh20bn deal to buy Vivendi’s 53 per cent stake in Maroc Telecom is expected to be completed by the end of May and is currently awaiting regulatory approval from the countries in which Maroc operates.

Etisalat’s local rival, du, has reported a net profit after royalities of Dh1.99bn for 2013.

The recent introduction of the mobile number portability (MNP) service, which allows users to switch between Etisalat and du while keeping the same phone number, led to the transfer of 23,000 numbers between the two firms, the Telecommunications Regulatory Authority said last month.

* With Reuters

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