Du Posts 62% Q1 Profit Hike
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Du Posts 62% Q1 Profit Hike

Du Posts 62% Q1 Profit Hike

The telecoms operator posted a net profit of Dhs333.1 million during the first quarter of the year.

Gulf Business

UAE telecoms operator Du reported a 62 per cent rise in first-quarter net profit, beating analysts’ estimates, as the telecoms operator added subscribers and mobile data revenue more than doubled from a year earlier.

Du, which is majority-owned by government institutions, made a profit of Dhs333.1 million ($90.69 million) in the three months to March 31, up from Dhs205.8 million in the year-earlier period, according to a statement to the Dubai bourse.

A one-off gain of Dhs30 million from “favourable settlements” also boosted this year’s first-quarter profit. The company did not provide further details on the gain.

Analysts polled by Reuters on average forecast Du would make a quarterly profit of Dhs268 million.

Quarterly revenue was Dhs2.45 billion, up from Dhs2.04 billion in the corresponding period of 2011. Revenue from mobile services rose 21.8 per cent to Dhs1.9 billion.

Mobile data revenue more than doubled from a year earlier to Dhs297 million.

“We believe this will continue to grow in importance as a revenue stream,” Du CEO Osman Sultan said in the statement.

Du, which ended rival Etisalat’s domestic monopoly in 2007, also added 320,600 mobile subscribers to increase its mobile customer base to 5.5 million, giving it a 46.7 per cent market share in the country.

Fixed line subscribers also rose 13.5 per cent to 545,300, while the firm’s operating margin in the first-quarter was 37.8 per cent, up from 30.5 per cent in the corresponding period of 2011.

Network sharing in the UAE, which will allow competition in home telecoms services, faces further delays because Du and rival Etisalat have yet to agree on commercial terms for the arrangement.

Shares in Du have risen 6.6 per cent year-to-date.

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