Etisalat shows flat YOY growth as margins shrink
UAE’s number-one operator continues to feel drag from foreign assets
The UAE's number-one telecoms operator Etisalat posted net quarterly profit of AED1.83bn, which represented a mere 1.1% increase on the same quarter in the previous year, Reuters reported.
Etisalat, which is active in 15 MEA markets and saw a surge in revenue and subscribers in the same period, still missed the AED2bn average net earnings figure forecast by analysts.
Q1 revenue for the telco stood at AED9.6bn, a 17% bump from the AED8.2bn of Q1 2012, while subscribers jumped from 122m to 141m - a 16% increase. The operator cited Asia markets as responsible for both surges, particularly Pakistan, as business from affiliate Pakistan Telecommunication Co Ltd (PTCL) was included for the first time.
Etisalat endured profit slumps in eight of the previous 12 quarters, as overseas operations put a strain on its margins. Rising costs, write-downs and one-off charges have continued to hit its bottom line, including that of $827m for a failed Indian joint venture and $769m from operations in Pakistan and Sudan.
The UAE telco recently secured $8bn in finance to pursue a bid for Vivendi's stake in Maroc Telecom, but faces competition from Qatar's Ooredoo.