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UAE telco du posts 1.3% rise in Q2 net profit

UAE telco du posts 1.3% rise in Q2 net profit

Net profit after royalties for the three months to June 30 rose to Dhs453m

Emirates Integrated Telecommunications Co (EITC), also known as du, posted a 1.3 per cent rise in second-quarter net profit on Thursday, buoyed by an increase in fixed line revenue.

Net profit after royalties for the three months to June 30 rose to Dhs453m ($123.34m) from Dhs447m a year earlier.

SICO Bahrain and EFG Hermes forecast du would make a profit of Dhs430.4m and Dhs428.7m, respectively.

Revenue rose 2.9 per cent to Dhs3.4bn, the United Arab Emirates’ No.2 telecom operator said.

Top line growth was supported by a 9.4 per cent increase in revenue from its fixed line business, CEO Osman Sultan said, adding that its mobile revenue, which fell 1.6 per cent, was affected during the Muslim fasting month of Ramadan and the Eid al-Fitr holiday.

Mobile subscribers on the du brand fell around 4 per cent in the second quarter, largely due to a government policy to disconnect numbers not used for a prolonged period of time or were not registered, Sultan told reporters on a conference call. He said he did not expect this to reverse in the third quarter.

Sultan did not disclose the number mobile subscribers and said that the majority were prepaid customers with postpaid users accounting for about 15 per cent to 20 per cent.

EITC also operates a service using the Virgin Mobile brand, which Sultan said was still in its “infancy” declining to comment on its performance since it launched last year.

The company is on track to meet its three-year plan launched in 2017 to find savings of around Dhs1bn, Sultan said.

The telecom company and rival Etisalat have to pay the United Arab Emirates government a royalty tax on their revenue and profit. In the second quarter, du paid Dhs528m in royalties.

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