Etisalat’s first-quarter profit rises 5% to Dh2.2bn

The UAE's biggest telecom operator’s subscriber base climbed 2% to 143 million

Shoppers walk in front of Etisalat Telecommunication in Dubai Mall, in Dubai, United Arab Emirates, December 20, 2018. Picture taken December 20, 2018. REUTERS/Hamad I Mohammed
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Etisalat, the UAE’s biggest telecom operator, posted a 5 per cent year-on-year increase in first quarter net profit, as the company continued to attract more customers.

Net profit rose to Dh2.2 billion in the first three months of the year, the company said on Tuesday in a regulatory filing with the Abu Dhabi Securities Exchange where its shares are traded.

Revenue in the period declined 1 per cent to Dh13bn from the year earlier period impacted by currency fluctuations in Pakistan and Morocco, the company said.

“Etisalat will continue its endeavour towards network modernisation and investment in future technologies ... powered by our pioneering deployment of 5G network ... that it will enable the company to address its growing customer and business aspirations,” said Saleh Abdullah Al Abdooli, Etisalat’s group chief executive.

Etisalat, which had a monopoly in the UAE until du entered the market in 2007, is set to introduce ultra-high speed mobile broadband 5G services this year. The operator has teamed up with Chinese tech giant Huawei to roll out 5G across the country as it views to build about 1000 5G towers this year.

UAE telecom subscribers reached 12.6 million while the number of subscribers across the company's units internationally climbed 2 per cent to 143 million in the first quarter.

Earnings per share of the company amounted to Dh0.25 - a 5 per cent increase from the same period last year.

The operator owns and operates subsidiaries in the Middle East, Africa and Asia.

The company, which owns a 28 per cent stake in Saudi telecom operator Etihad Etisalat (Mobily), has also signed an agreement with Telecom Egypt to provide the first voice services over an LTE network in the country.

EFG Hermes, an Egyptian investment bank, said Etisalat’s results came broadly in line with its estimates on most levels, without any major surprises.

"Operating performance was largely stable across most core operations and margins were slightly healthier across most units," Omar Maher, vice president of telecoms at EFG Hermes, told The National.

Etisalat’s performance in the UAE – the largest contributor to the group’s revenues – was also in line with our expectations and management guidance, added Mr Maher.

“Hence, we do not have any concerns on the overall outlook and we see minimal risks on earnings and dividends in 2019 financial year. We reiterate our neutral rating on the stock as we see no catalysts and believe it is fairly valued at current levels.”