Fixed-line decline for Etisalat
Domestic growth stagnates as UAE operator outlines expansion plans
The effects of the global economic downturn appear to have caught up with UAE operator Etisalat in the first quarter of this year.
Quarter-on-quarter net revenue and profit remained flat, while the operator struggled to sign up more mobile users and the number of fixed-line subscribers actually fell.
The UAE incumbent suffered a drop in fixed-line subscribers, from 1.36 million during the last quarter of 2008 to 1.349 million during the first quarter of this year.
There has been a slight growth in the number of internet subscribers, from 1.15 million to 1.202 million, but mobile subscriber growth has flat lined.
Etisalat said it had 7.341 million mobile subscribers during the first quarter of this year – a slight increase of 41,000 subscribers from the preceding quarter.
Mobile penetration levels in the UAE are among the highest in the world, but industry figures expect the days of rapid, quarter-on-quarter growth to be at an end.
CEO of rival operator Du, Osman Sultan, last week said that he expected growth to slow considerably “in line with the more challenging context”.
Although Etisalat’s results show a 4% increase in net profit and a 13% increase in net revenue when compared to the same quarter of 2008 – in line with analysts’ forecasts - there has been little growth during this year.
Net profit for the first quarter of this year stood at AED 2.178 billion, compared to 2.1 billion during the last quarter of 2008.
Net revenue for the first quarter of 2009 was AED 7.119 billion, which was AED 7.1 billion during the last three months of 2008.
As growth in Etisalat’s domestic market appears to stagnate, chairman Mohammad Omran used the results as an opportunity to outline the operator’s expansion plans.
“We are now looking for new investment opportunities,” he said in a statement. “We are continuing to study many different markets for the best opportunities that will add to Etisalat’s reputation and support our ambition to become one of the largest ten operators in the world.
“We have identified Syria and Lebanon as having potential for 2009, and we await an appropriate opportunity to participate in these markets.”
He added that the commercial launch of Etisalat’s operations in India, through its 45% acquisition of Swan Telecom, is expected to take place “during the second half of 2009”.