Etisalat third-quarter profit lower on forex losses and higher taxes

The telecoms operator Etisalat posted an 8.6 per cent drop in its third-quarter net profit, as forex losses and higher tax hit its earnings.

The company’s net profit was Dh1.9 billion for the quarter. Revenue for the group was down 1 per cent to Dh13bn. Etisalat attributed the revenue decline to “unfavourable exchange-rate movements and competitive environments in selected markets”.

In June, Etisalat warned that its net profit this year would be affected by about Dh204 million on the back of alleged accounting irregularities related to its Saudi unit Mobily. Etisalat owns 27.5 per cent of the Saudi telecoms operator.

Saudi market authorities have been investigating Mobily since late last year. It assigned a special team to look into Mobily’s finances, which raised concerns about its accounting ­methods.

Etisalat’s revenue from the UAE was up 6 per cent during the third quarter to Dh7.2bn. Subscribers in the UAE rose 7 per cent year-on-year to 11.6 million by the end of the third quarter.

Last week, the Etisalat chief executive Ahmad Julfar told The National that he aims to raise half of Etisalat’s revenue from data. Etisalat operates across 18 markets in the Middle East and Africa. Currently, data provides 30 per cent of the group’s revenue.

Etisalat’s pledge to grow its revenue from data came as it enters into full market competition with du, its local competitor, over fixed broadband and landline services.

Last week, the pair said that they would be expanding services into areas of the country where each had previously been operating exclusively.

Until now the public was limited to one provider, with the majority of Abu Dhabi residents restricted to Etisalat and residents of new areas in Dubai tied to du.

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