Etisalat profit flat on higher taxes, depreciation and lower net finance

Telecom operator’s revenues rise 5% to Dh13.1b in first quarter

The etisalat Group yesterday reported a flat yearon-year profit of Dh2.1 billion in the first quarter due to higher depreciation charges, lower net finance and income and higher taxation.

The Abu Dhabi-based telecom operator’s revenues increased 5 per cent year-onyear to Dh13.1 billion.

Its earnings before interest, taxes, depreciation and amortisation (Ebitda) increased 2 per cent year-on-year to Dh6.5 billion.

“Etisalat’s first-quarter results are a continuation of previous quarters’ solid performance, and a promising start for the current year, alluding positive prospects for both customers and shareholders,” Saleh Al Abdooli, etisalat Group CEO, said in a statement.

“As we continue to encounter evolving industry dynamics, innovation and successful partnerships remain relevant and integral in sustaining our leading market position and assuring our profitability,” he said.

Etisalat, which operates in 16 markets across the Middle East, Africa and Asia, did not give a detailed breakdown of the results. In the UAE, the operator’s revenues in the first (Group) quarter increased 3 per cent year-on-year to Dh7.8 billion, due to the growth of digital and ICT services, and the wholesale segment, as well as an increase in handset sales.

When compared to quarter on quarter, revenues from the UAE fell 3 per cent due to lower handset revenues.

Subdued impact

“Given the increasing cost of acquiring new customers, the proportionate impact on the bottom line is subdued,” Sukhdev Singh, vice-president at market research and analysis services provider Kantar AMRB, told Gulf News.

“While etisalat has performed very well in growing [the] customer base by 3 per cent and registering a 5 per cent increase in revenue, the profit growth has suffered due to the higher cost of sales and increased network costs.”

These are early signs of improving economic conditions, he said, adding that though one has to be watchful over the next quarter or so, business activities appear to be picking up in the region, particularly in the UAE.

Etisalat’s total subscribers grew 3 per cent year-on-year to 12.9 million in the UAE. Out of that, the mobile subscriber base grew 4 per cent year-onyear to 11.1 million, representing a net addition of 0.5 million mobile subscribers, mostly in the prepaid segment.

The group’s total subscriber base touched 144 million, representing a year-on-year increase of 3 per cent.

It added 4.1 million new subscribers during the last 12 months, due to strong subscriber growth in the UAE, Morocco, Ivory Coast, Benin, Togo, Niger, Mali, Burkina Faso, Pakistan and Afghanistan.