UAE telco du raises dividend after best ever profit tally

Dubai: The Dubai headquartered du will be paying out 54 fils a share as 2024 dividend - it's highest ever to date. This compares with 34 fils a year ago.

The telcom services provider - which is expanding its scope in high-vale tech and fintech spaces - hiked the dividend after net profit grew 49.1% to a record Dh2.5 billion. Revenues were at Dh14.6 billion, a tally that du said came in above its growth forecasts of 5%-7%.

The higher number reflects 'our ability to drive both top-line expansion and bottom-line improvement', said a statement.

The combined fixed-line and mobile subscribers now come close to 10 million.

“In 2024, we made significant progress in our transformation journey from a traditional telecom operator to a comprehensive digital services provider," said Malek Sultan Al Malek, Chairman.

"The introduction of the 'du Tech' and 'du Infra' sub-brands enhances our B2B service offerings and caters more effectively to specific market segments.

"The launch of du Pay challenges the status quo, promoting financial inclusion, accessibility and security.

"Our outlook remains positive as we continue to progress on our transformation journey, prioritise emerging technologies, and strengthen our position in the telecom and ICT sectors to meet evolving market demand."

Clearly, the sizable capex spending of the previous years is paying off. The company made a concerted move to expand beyond pure-play telco, with features such as private cloud services for businesses, creating new remittance channels via its fintech platform, etc.

While these are still early days for these services to realise optimum returns, a strong start has been made, say analysts.

On DFM, the stock closed the day at Dh7.9, up by 0.6%, as the buzz about a possible dividend hike filled the air.

"In the data centre business, strategic partnerships with Oracle Alloy and AI Hosting Hub boosted our capabilities, while a new strategic partnership with Telefónica will strengthen our competitive edge," said Fahad Al Hassawi, CEO of du.

du can be pleased about the 600,000 net additions in mobile subscribers during Q4-2024, growing 4.2% to 8.9 million subscribers overall. The postpaid subscriber numbers were 10% higher year-over-year to 1.8 million customers 'supported by attractive B2B initiatives such as 'SME Infinite' plans and new postpaid plans for large enterprise customers as well as new consumer offers'.

The prepaid user base grew 2.9% to 7.1 million, through offers that targeted blue-collar workers and those offered to du Pay customers. Also helping the numbers were the e-sim services for tourists, as well as 'the tourist welcome bonus and enhanced bundles for tourists'.

Most notable was the intake under 'other revenues, which in 2024 was up 8.7% to Dh4.1 billion. This was brought on by a 'strong increase in our ICT business and highlighting the successful diversification of our revenues beyond connectivity'.