Q2 2014 Year-on-Year Revenues Exceed AED 3 billion for First Time
Emirates Integrated Telecommunications Company PJSC (“du”) publishes Q2 2014 Results
·
Q2 revenues of AED 3.02 billion, a 13.7% increase on Q2 13 – the first time quarterly revenues have surpassed AED 3 billion
·
Q2 Net Profit before Royalty of AED
949
million, a 22% increase on Q2 13
Dubai, 24 July 2014
–
Emirates Integrated Telecommunications Company PJSC (“du”) today
announced its financial results for the second quarter of 2014
demonstrating robust growth.
In
line with du’s progressive dividend policy, the Company has announced
that it will issue shareholders with an interim dividend of 12 fils per
share as a reward
for their continued support.
Key
drivers behind the solid performance include an uptick in Fixed revenue
of 30% as well as almost a 10% rise in Mobile revenue fuelled by an
increase in Post
Paid customers. In addition, du’s efficiency strategy is continuing to
deliver resulting in a reduction in overheads from Q1 2014.
The
UAE TRA’s ‘My Number, My Identity’ campaign requiring all mobile users
to register their mobile number to protect customer privacy and to avoid
fraud, resulted
in a natural churn of 468,000 customers in the pre-paid segment as
unregistered mobiles were withdrawn from the market place. Further
attrition is possible in the coming quarters.
Financial Highlights for Q2 2014:
·
Revenues grew to AED 3.02 billion; a 13.7% increase against Q2 2013 (AED 2.66 billion)
·
EBITDA increased 17.9% compared to Q2 2013
to AED 1.29 billion from AED 1.09 billion
·
Net profit before Royalty grew 22%
to AED 949 million versus Q2 2013 (AED 778 million)
·
Net Profit after Royalty in Q2 2014 grew to 548 million AED a 15.5% increase on Q2 13
Revenue Breakdown:
·
Mobile revenue reached AED 2.26 billion, a 9.5% increase year-on-year (AED 2.07 billion)
·
Mobile data revenues increased by 18.6%, from AED 573 million in Q2 13 to AED 680 million
·
Fixed revenue increased by 30% to 541 million compared to 416 in Q2 2013
·
Data now represents 29.3% of mobile service revenues, up from 27.1% in Q2 2013
Osman Sultan, du’s Chief Executive Officer, commented:
"I am pleased to report another quarter of solid growth, with double
digit growth across many of our key indicators and an increase in the
number of higher-value post-paid customers we serve. These results show
that by continuously developing innovative
propositions to meet our customers’ requirements and rigorously
implementing our efficiency strategy, we are able to deliver steady
growth despite a highly competitive environment.
“Our
strong performance is reflected in our net profit before royalty, which
was up 22% on 2013 at AED 949 million. EBITDA for the quarter reached
AED 1.29 billion, an increase of 17.9% compared to the same quarter
last year. Data continued to be a key market driver during the quarter
which translated into data revenues of AED 680 million in Q2 2014, an
18.6% increase on Q2 2013 as our customers’ demand for connectivity
remained strong.
“We
are pleased to announce that the Board is recommending an interim
dividend of 12 fils per share to be approved at the general assembly.
“Going
forward, we are proud to be working under the umbrella of the UAE’s
2021 Vision to implement Smart Government and we look forward to
outlining
our plans to contribute to the transformation of Dubai into a Smart
City in the near future.”
|
Profit & Loss Summary
|
|||||
|
(AED m)
|
Q2 '14
|
Q2 '13
|
YoY Change
|
Q1 '14
|
QoQ Change
|
|
Revenue
|
3,024
|
2,660
|
13.7%
|
2,955
|
2.3%
|
|
EBITDA
|
1,290
|
1,094
|
17.9%
|
1,183
|
9.0%
|
|
EBITDA Margin
|
42.7%
|
41.1%
|
1.5 basis points
|
40.0%
|
2.6 basis points
|
|
Net profit before royalty
|
949
|
778
|
22.0%
|
865
|
9.7%
|
|
Net profit margin
|
31.4%
|
29.2%
|
2.1 basis points
|
29.3%
|
2.1 basis points
|
|
Balance Sheet Summary
|
|||||
|
(AED m)
|
As of 30 June 2014
|
As of 31 March 2014
|
|||
|
Cash & Cash Equivalents
|
4,243
|
|
|||
|
Total Assets
|
15,683
|
16,
|
|||
|
Total debt
|
4,085
|
|
|||
|
Net Cash
|
158
|
|
|||
|
Total Equity
|
7,316
|
|
|||
|
Cash Flow Summary
|
|||||
|
(AED m)
|
Q2 2014
|
Q2 2013
|
|||
|
Operating & investing cash
|
(333)
|
(106)
|
|||
|
Financing
|
(688)
|
(1,031)
|
|||
|
Net change in cash
|
(1,021)
|
(1,137)
|
|||
|
Ending cash balance
|
4,243
|
|
|||
|
Customer Summary
|
|||||
|
(000s)
|
Q2 '14
|
Q2 '13
|
YoY Change
|
Q1 '14
|
QoQ Change
|
|
Mobile Customers
|
7,161
|
6,654
|
7.6%
|
7,550
|
-5.2%
|
|
Fixed line customers
|
619
|
578
|
7.1%
|
614
|
0.9%
|
|
Telephony
|
262
|
239
|
9.8%
|
259
|
1.1%
|
|
Broadband
|
163
|
148
|
10.5%
|
161
|
1.3%
|
|
TV
|
136
|
126
|
8.0%
|
134
|
1.4%
|
|
Call Select
|
58
|
66
|
-11.5%
|
59
|
-1.6%
|
Q2 2014 Results Analysis
Total Revenue
Revenues grew to AED 3.02 billion;
the first time revenue
has lifted over AED 3 billion for a quarter, and a 13.7% increase
against Q2 2013 (AED 2.66 billion). This increase was driven by
consistent data revenues and a continued focus on the post-paid segment.
Mobile revenue grew to AED 2.26 billion, a 9.5% increase year-on-year (AED 2.07 billion). Fixed revenue increased by 30% to
541 million compared to 416 million in Q2 2013.
The company remains focused on innovation and improving service experience to retain high value customers across all segments.
Mobile and Fixed Customer
The
company is proud to now serve a total of approximately 7.2 million
active mobile subscribers. The ‘My Number My Identity’ deadline during
Q2
2014 resulted in churn of 468,000 active subscribers but the steady
increase (7.6%) of the total mobile subscriber base year on year is an
acknowledgment of du’s attention to product innovation and customer
service.
ARPU
lifted in Q2 2014 due to the company’s focus on data revenue and
increasing the proportion of post-paid customers. du continues to
experience
pricing pressures from competitors and the popularity of VOIP services,
a trend the entire industry is facing. ARPU is expected to remain
steady over the coming quarters.
Mobile Data (AED Million)
Mobile data revenue increased 18.6% to AED 680 million in Q2 2014 from AED 573 million in Q2 2013. Data now represents 29.3%
of mobile service revenues, up from 27.1% in Q2 last year.
du
customers are using increasing amounts of data and as a result, the
company has developed propositions to provide their users with the data
services
required to meet their needs. The ability to monetise data is a
challenge faced by the industry as a whole but as a result of the
company’s commitment to innovation in this area, revenues from mobile
data continue to steadily increase.
EBITDA (AED Million)
EBITDA in Q2 2014 increased 17.9% compared to Q2 2013
to
AED 1.29 billion from AED 1.09 billion. This growth represents an
improvement in operating expenses as a percentage of revenue from 26.3%
in Q2 2013 to 23.9% in Q2 2014. The EBIDTA level
was also favourably impacted by settlements of prior year provisions.
Net Profit Before Royalty
du demonstrated continued growth in net profit after a solid start in 2014. Net profit before Royalty grew 22%
to
AED 949 million versus Q2 2013 (AED 778 million) whilst Net Profit
after Royalty in Q2 2014 increased to AED 548 million, a 15.5% increase
on Q2 2013.
