The UAE’s biggest telecoms operator e& — formerly known as Etisalat — reported a nearly 25 per cent rise in fourth-quarter net profit, driven by a surge in the number of subscribers.
Consolidated net profit after royalty attributed to the owners of the company in the October-December period jumped to Dh2.7 billion ($730 million), e& said in a statement to the Abu Dhabi Securities Exchange, where its shares are traded.
The company attributed the increase to higher income from associates, and lower depreciation and amortisation expenses.
From diversifying our business and revenue streams to expanding to new verticals and introducing innovative services, we had a laser focus on leveraging the potential offered by digital transformation
Jassem Alzaabi,
e& chairman
Revenue for the fourth quarter of last year reached Dh13.1 billion, a yearly decline of 4 per cent. Fourth-quarter sales continued to witness “significant exchange rate volatility in the Egyptian pound, Pakistani rupee and Moroccan dirham as a result of global macroeconomic turbulence”.
However, this was mostly offset by a strong performance in the UAE and strong local currency growth in operations in Egypt and Pakistan, the company said.
For the full financial year, the profit attributable to the owners of the company in the January-December period jumped 7.4 per cent to Dh10 billion while revenue dropped 1.7 per cent to Dh52.4 billion.
“From diversifying our business and revenue streams to expanding to new verticals and introducing innovative services, we had a laser focus on leveraging the potential offered by digital transformation,” e&’s chairman Jassem Alzaabi said.
“We remain committed to serving our customers and creating long-term value for our shareholders. As a global technology and investment group, we will continue to work towards making a positive impact in the communities we serve.”
Abu Dhabi-based e& was founded in 1976 and is the UAE's oldest telecoms company. It has operations in about 16 countries across the Middle East, Asia and Africa.
Last February, e& rebranded as it sought to transform into a global technology investment conglomerate.
The company provides innovative digital solutions, smart connectivity and next-generation technology to a variety of customer segments through its business pillars — etisalat by e&, e& international, e& life, e& enterprise and e& capital.
Etisalat by e& recorded 13.8 million subscribers in the UAE last year, an increase of 8.8 per cent compared to 2021. The group’s aggregate subscribers reached 163 million, an increase of 2.5 per cent over 2021, in nearly 16 markets.
The company’s board of directors also proposed a dividend of Dh0.40 per share for the second half (July-December) of last year, representing a total dividend of Dh0.80 per share for the full financial year.
“Despite various global challenges, our domestic and international operations achieved impressive results, reinforcing our leadership position in highly competitive and evolving markets,” said Hatem Dowidar, group chief executive of e&.
“Our growth mindset enables us to achieve our goals while creating additional and long-term value for our customers and shareholders … prudent mergers and acquisitions further accelerated our growth and diversification creating new streams of revenue and positioned us as a leading global technology group.”
In October, e& launched a $250 million venture capital fund as part of its new investment unit, e& capital, to support the tech start-up ecosystem. The e& capital VC fund will seek to attract, engage and support start-ups and provide them with access to investor and expert networks.
In the same month, it also completed the 100 per cent acquisition of Smartworld, one of the UAE’s leading technology solutions providers and systems integrators.
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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Indoor cricket in a nutshell
Indoor Cricket World Cup - Sep 16-20, Insportz, Dubai
16 Indoor cricket matches are 16 overs per side
8 There are eight players per team
9 There have been nine Indoor Cricket World Cups for men. Australia have won every one.
5 Five runs are deducted from the score when a wickets falls
4 Batsmen bat in pairs, facing four overs per partnership
Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.
Zones
A Front net, behind the striker and wicketkeeper: 0 runs
B Side nets, between the striker and halfway down the pitch: 1 run
C Side nets between halfway and the bowlers end: 2 runs
D Back net: 4 runs on the bounce, 6 runs on the full
