Abu-Dhabi based Etisalat Group grew its subscriber base in the third quarter boosted by a better performance in its home market. The increase in customer numbers comes as the UAE’s largest telecom operator and local rival du begin competition over fixed voice and broadband services.
The operator on Wednesday also reported an 8.6 per cent drop in net profit for the three months to September as forex losses and a higher royalty to the government ate into earnings. Etisalat’s net profit was at Dh1.9 billion for the quarter. Revenue for the group was 1 per cent lower to Dh13bn. The company attributed the revenue decline to “unfavourable exchange rate movements and competitive environments in selected markets”.
“Earnings were in line with our estimates,” said Nishit Lakhotia, head of research at Bahrain-based SICO. “UAE operations continue to perform strongly while TCL in Pakistan and currency devaluation in Egypt impacted the international operations.”
Sebastien Henin, head of asset management at Abu-Dhabi based The National Investor, said that Etisalat faced regulatory pressure in Pakistan as some subscriptions were deactivated for security reasons. But overall, the operator reported “acceptable performance that is in line with the market forecast”.
Etisalat’s subscribers in the UAE rose 7 per cent year-on-year to 11.6 million by the end of the third quarter. Revenues from the UAE were up 6 per cent year on year to Dh7.2bn on a “strong performance in the mobile and fixed broadband and ICT segments”, it said.
Last week, chief executive Ahmad Julfar told The National that Etisalat is aiming to get half of its revenue from data. Currently, data contributes 30 per cent of the group’s revenue.
Etisalat’s pledge to grow its revenue from data comes as it enters into full market competition with du over fixed voice and broadband services.
The pair last week said that they will be expanding their services to the areas of the country where each had previously operated exclusively. Until now consumer choice had been limited by location, with the majority of Abu Dhabi residents serviced by Etisalat and residents of new areas in Dubai serviced by du.
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