At Dh303m, UAE telco du signals strong net profit for Q2-2022
Postpaid subscriber numbers continue to grow at du, setting up higher margin gains
Dubai: Demand for broadband and mobile services signalled a 26.2 per cent increase in UAE telco du’s second quarter 2022 net profit, which totalled Dh303 million. This was on a revenue platform of Dh3.13 billion, up 9.9 per cent.
The du board of directors have approved an interim dividend of 11 fils a share. (In the first quarter, du turned in a Dh240 million net profit from revenues of Dh2.85 billion.)
While prepaid mobile and data subscriber numbers dropped after the Expo, on postpaid, du managed a fourth straight quarter of growth, with 1.4 million subscribers. The mobile customer base at the end of H1-22 was 7.4 million, with prepaid making up 6.1 million.
“We have delivered three consecutive quarters of improvements and growth,” said Fahad Al Hassawi, CEO. “Crucially, our service revenues have been - and will - continue to be a significant driver of profitability.” In fact, during the April-June period, du’s service revenues hit a three-year high.
We had a fourth consecutive quarter of net additions in the high-value postpaid segment. Our customer acquisition of consumer broadband services remains robust. We are also actively managing the efficiency of our business to drive profitability. Cash generation will sustainably improve as our capex program continues to normalize.
- Fahad Al Hassawi, CEO of du
The du capex numbers do show moderation, at Dh558 million, with a capital intensity of 17.8 per cent. According to the telco, this ‘reflects the usual seasonality as most of the capex spend is skewed towards the second-half of the year. More importantly, our capex profile is continuing to normalize following two consecutive years of high capital intensity.’
Broadband possibilities
du got another 35,000 subscribers to sign up for its broadband services, on top of the 31,000 during Q1-22. In the recent past, the Dubai-headquartered operator had also been providing 5G-enabled services into homes. “This strong performance is due to a combination of connecting new premises to our fiber network and our attractive commercial offering,” the statement added.
Overall consumer broadband numbers at the end of June was 473,000, up 69.5 per cent.
Revenue split
Revenues, which totalled Dh3.13 billion was made up of Dh1.4 billion through mobile services - which ‘continued their recovery’ - while handset sales generated Dh196 million. Fixed services revenues are higher by 24.4 per cent from a year ago to Dh855 million. Overall service revenues increased 14.1 per cent to Dh2.26 billion.
The recovery trend seen towards the end of last year, is morphing into a growth trajectory that is driving revenues back to pre-Covid levels and an improvement in profitability. Our transformation projects, a key enabler of these commercial initiatives, are progressing according to plan. With these elements in mind and on the basis of our solid results.
- Malek Al Malek, Chairman of du