10 May, 2012
du Announces First Quarter 2012 Results
Dubai, UAE- Emirates Integrated Telecommunications Company
PJSC ("du") today announced its financial results for the
first quarter of 2012.
Financial highlights for the quarter:
Revenues increased 20.1% year on year to AED 2.4
billion, up from AED 2.0 billion in Q1 2011.
Mobile revenue increased 21.8%, growing to AED 1.9
Mobile data revenue grew to 15.5% of mobile
o Mobile data revenue more than doubled to AED 297
million from AED 141 million in Q1 2011.
Post-paid mobile customer base contributed 48.6% of
the growth in mobile revenues.
EBITDA increased by 49.0% year on year to reach AED
o EBITDA margin grew to 37.8%, up from 30.5% in Q1
Net profit before royalty increased 61.8% reaching
AED 666 million compared to AED 412 million in Q1 2011
o Net profit margin (before royalty) increased to
27.2% from 20.2% in Q1 2011.
Customer highlights for the quarter:
320,600 mobile customers added, bringing total
mobile customer base to 5.5 million.
o 50,400 postpaid mobile customers added, now
representing 7.5% of the mobile customer base.
Fixed line subscribers increased to 545,300; a 13.5%
increase from Q1 2011.
Osman Sultan, du's Chief Executive Officer, said, "We have
enjoyed a strong start to the year. We have achieved
healthy growth in revenues, with strong performance from
what we believe will be key drivers going forward,
including mobile data revenue and our post-paid subscriber
base. Our mobile data revenues in particular more
than doubled year on year. We believe this will
continue to grow in importance as a revenue stream, and we
will seek to continue developing innovative products and
services that encourage data usage.
While top-line growth has been significant, it has more
importantly been achieved with greater efficiency.
Our EBITDA and net profit have both grown significantly,
with margins both increasing by more than seven percentage
points, an achievement we are very pleased with.
Delivering value is at the heart of everything we do and is
considered in every strategic decision. We believe that the
areas we are focusing on will deliver the greatest value to
all of our stakeholders - our customers, our employees, and
of course our shareholders."
Q1 2012 results analysis
Total combined revenues for Q1 12 increased 20.1% year on
year to AED 2.4 billion compared to AED 2.0 billion for Q1
11. The primary driver of revenue growth was the
mobile business. Quarter on quarter, growth was 1.5%,
partially impacted by seasonal differences typically
affecting the fourth quarter, with a positive impact from
what is a traditionally busy period for conferences, as
well as cultural festivals such as EID Al-Adha,
Diwali, and Christmas. In addition the first quarter
was a day shorter than the fourth quarter, impacting
Significant customer additions
At the end of March, du's share of the UAE mobile market
stood at 46.7%, based on the data published by the
Telecommunications Regulatory Authority ('TRA') and
competitor disclosures. 320,600 mobile customers were added
in the first quarter of 2012, more than in any of the
quarters in the last two years.
More than a sixth of the additions were high-value
post-paid customers. This is further evidence of the
strength of du's position as being the provider of choice
for the majority of new mobile customers in the UAE.
du now serves a total of approximately 5,536,600 active
Sustained growth in mobile revenues
Mobile revenues grew by a further 21.8% year on year in the
first quarter, reaching AED 1.92 billion, compared to Q1 11
(AED 1.58 billion) and up 1.8% versus Q4 11 (AED 1.89
Drivers of performance in this segment continue to include
growth in the Company's customer base, strong ARPU ,
especially from the post-paid segment, and increasing data
The high-value postpaid mobile customer base continues to
increase in importance, contributing 48.6% of the growth in
mobile revenues during Q1 12. 43.6% of this
contribution can be attributed to growth in ARPU.
A further 50,400 post-paid customers were added in Q1 12,
testament to the Company's continued efforts to attract and
retain high-end mobile users. 413,200 high-value postpaid
customers now represent 7.5% of the mobile customer base
(up from 6.7% in Q1 2011).
Mobile ARPU remained steady at AED 119, for the first
quarter, up from AED 118 during Q1 11.
Data revenue contribution growing
Mobile data usage continues to grow as an important
component of du's mobile revenues, representing
approximately 15.5% of mobile revenues. Mobile data
revenues more than doubled year on year from AED 141
million in Q1 11 to AED 297 million in Q1 12. Mobile data
revenue for the quarter was boosted by a promotion that
began at the end of December and finished during the first
Revenues for du's fixed business, including fixed
telephony, TV and Broadband, amounted to AED 409 million, a
21.2% year on year increase (Q1 11: AED 337 million) and a
4.5% quarter on quarter increase (Q4 11: AED 391
Decrease in overheads as percentage of revenue
Total overheads stood at AED 769 million, representing
31.4% as a percentage of revenue and a decrease of nearly
three percentage points (as a percentage of revenue) over
the same period a year ago (34.2% in Q1 11). This
reflects the Company's focus on profitability and its
efforts to improve operating efficiencies through internal
During the first quarter, EBITDA grew by 49.0% year on
year, and increased 9.0% quarter on quarter to AED 925
million compared to AED 621 million and AED 848 million
respectively. EBITDA margins also improved to 37.8% in Q1
12, up by more than seven percentage points from 30.5% in
Q1 11, and up compared to the previous quarter (35.2%).
Net profit before royalty for Q1 12 was AED 666 million
representing an increase of 61.8% over the AED 412 million
reported for Q1 11, and a 34.0% increase quarter on quarter
(up from AED 497 million in Q4 11).
While net profit growth was healthy due to revenue growth
combined with increased operational efficiency
improvements, quarter on quarter growth in net profit
before royalty in Q1 2012 was positively impacted by an
exceptional impairment of AED 47 million in Q4 2011 and
one-off gains of approximately AED 30 million from
favourable settlements in Q1 2012.
Provisioning for royalty continues to be made at 50%.
The Company's capital expenditure programme remains
focused, with AED 335 million accounted for during Q1
12. More than half of the Q1 spend was focused on
Product & Service initiatives during the first quarter
- Introduced 'The Executive Plan': specifically
targeted at the new generation of business executives.
- The best value on international calls comes from Pay
as you Go® from du.
- Introduced the "Music Store": The 24 hour mobile
destination for unlimited music downloads.
- Launched the new Sony PlayStation® Vita 3G in the
- Built the 4G/LTE Network with Cisco Mobile Internet
Solutions to meet the growing demand for advanced mobile
- Received international recognition for having the
best mobile broadband network in the Middle East and
- Dubai SME, du and Microsoft Gulf to launch ICT
package for businessmen and investors which will benefit
over 72,000 small and medium enterprises.
- Partnered with Mobile Doctors to launch 24/7
Physician Helpline to coincide with World Health Day
- Introduced a new VSAT service platform to provide
better connectivity for remote sites as an alternative to
traditional telecommunication services.
- Launched Russian Prime Package targeted at the
rapidly increasing market of Russian Expats in the UAE