Du reports 112 per cent surge in net profit in Q111

UAE telco Du, reported revenue of AED2.038 billion (US$554.8 million) for the quarter to end-March, an increase of 29 per cent year-on-year. The company’s earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 69.4 per cent year-on-year to AED621 million, while net profit before royalty for the first quarter of 2011 increased 112 per cent to AED412 million.

Following the government’s announcement that Du would pay a 15 per cent royalty rate for the year ended December 31, 2010, the company will provision for royalty payments of 50 per cent of its profits until it is advised on the rate for 2011. Du expects to invest a total of AED1.7 billion in 2011, with AED477 million accounted for during the first quarter of the year, 52 per cent of which was spent on the rollout of its mobile network.

Subscriber growth and rising data usage were the key drivers behind Du’s strong sustained mobile revenues, which reached AED1.576 billion, up 35 per cent year-on-year. Mobile data revenues more than doubled from AED59 million in Q110 to AED141 million a year later and accounted for nine per cent of total mobile revenues. Du said it added 272,000 net active mobile subscribers during the quarter, taking its wireless customer base to 4.604 million as at end-March, of which 306,400 were post-paid customers (seven per cent of the total base), up 87 per cent year-on-year.

Mobile average revenue per user (ARPU) remained steady, at AED118 for the quarter, up from AED108 during the same period a year earlier. Revenues generated by Du’s fixed business, including fixed telephony, TV and broadband, amounted to AED337 million, a 27 per cent year-on-year increase. The company’s fixed line subscriber base grew 27.3 per cent from 456,700 in the first quarter of 2010 to 581,500 a year later, with 20,700 lines added during the quarter. Du has forecast a nationwide rollout of its fixed line services before the end of the year.