Etisalat Group's profit stabilises in Q1
Strong growth in international markets offsets declines in home market
Etisalat Group's profit remained stable in the first quarter of the year as growth in international markets helped to offset domestic declines.
The telco posted a net profit after government royalty of AED1.809 billion ($492m) for the quarter ended 31 March 2012, compared to AED1.817 billion a year earlier. Revenues reached AED8.205 billion, up 2% from the same period last year.
The telco's operating profit for Q1 was AED3.430 billion before federal royalty, representing a 42 % margin.
Etisalat attributed the stabilisation in profit to a "successful strategy of diversifying revenues across both geographies and sectors". Revenue earned from international operations grew 21% in the first quarter compared to the same period last year, driven mainly by Saudi Arabia, Egypt, Afghanistan and Nigeria.
Etisalat added that it maintained a healthy liquidity position with cash reserves of AED11.5 billion.
Mohammad Omran, chairman, Etisalat, said: "Group performance has been solid for the first quarter. [...] Our growth in this first quarter is predominantly due to increased penetration into high population markets, including Saudi Arabia, Egypt, Nigeria and Afghanistan, as well as through developing innovative services to serve our clients better."
Ahmad Julfar, group CEO, Etisalat, added that the telco had achieved its aims of reducing costs and realising previous investments in Next Generation Networks. "These goals are being realised through, among other things, the launch of the nationwide Fibre To The Home and LTE - 4G networks in the UAE, and network optimisation across the group to give Etisalat customers in our markets of operation the best network quality and speed," he said.
Etisalat remains under pressure in its home market where it is losing market share to its competitor, Du.
Etisalat posted its full year results for 2011 in March.