Emirates Integrated Telecommunications Company PJSC Reports Second Quarter 2022 Results

  • Based on these results, the Board of Directors approved the distribution of an interim cash dividend of AED 0.11 per share

Dubai, United Arab Emirates Emirates Integrated Telecommunications Company PJSC (“EITC”) has released its financial results for the quarter ended June 30, 2022. Revenue increased by 9.9% to AED3.14 billion on sustained demand for high quality services. debit and mobile. EBITDA improved by 12.1% to AED 1.27 billion thanks to a strong increase in service revenue and gross margin expansion. Net profit increased by 26.2% to reach AED303 million. Operating free cash flow (EBITDA – Capex) increased by 47.7% to reach AED 709 million thanks to the increase in EBITDA and capital expenditure which is starting to normalize. Based on these results, the Board of Directors approved an interim cash dividend of AED 0.11 per share, an increase of 10% over the interim dividend of the previous year.

Operating Highlights

  • Our mobile customer base grew by 13.0% to 7.4 million subscribers. We highlight the sustained performance of our postpaid segment with 24,000 net additions, a fourth consecutive quarter of growth, reaching 1.4 million subscribers. We ended the quarter with 6.1 million prepaid customers. The customer base of prepaid visitors declined after the end of Expo 2020 and the start of the low tourist season. Excluding visitor SIMs, our prepaid customer base remained stable compared to the previous quarter.
  • Our consumer broadband customer base grew by 69.5% to 473,000. We attracted 35,000 new customers (Q2’21: 31,000). This good performance is due both to the connection of new premises to our fiber network and to our attractive commercial offer.

Financial Highlights

  • Revenue increased by 9.9% to reach AED3,137 million. Mobile service revenues continued their recovery: revenues increased by 8.6% to reach AED 1,406 million, while handset sales generated revenues of AED 196 million. Fixed benefits income jumped 24.4% to reach AED855 million as our consumer and enterprise segments continue to perform. Overall, service revenue increased by 14.1% to reach AED2,261 million.
  • EBITDA increased by 12.1% year-on-year to reach AED1,267 million. This improvement is mainly explained by the increase in service revenues and the improvement in the gross margin. Given the increased profitability of mobile and fixed services, EBITDA margins increased by 80 bps to 40.4%.
  • Net profit jumped 26.2% to reach AED303 million. The impact of higher EBITDA was partially offset by higher depreciation charges and federal royalties.
  • Capital expenditure was moderate at AED558 million on a capital intensity of 17.8%. This reflects the usual seasonality, as most capital spending is geared towards the second half of the year. More importantly, our investment profile continues to normalize after two consecutive years of high capital intensity.
  • Operating free cash flow (EBITDA – Capex) increased by 47.7% to reach AED 709 million. This is the combined result of improved EBITDA and lower capital expenditures.

Financial Summary

million AED

Q2 2021

Q2 2022

change

Revenue

2,855

3,137

9.9%

EBITDA

1,130

1,267

12.1%

Margin

39.6%

40.4%

0.8 points

net profit

240

303

26.2%

Capex

650

558

-14.1%

capital intensity

22.8%

17.8%

-5.0pts

Operating free cash flow

480

709

47.7%

Malek Al Malek, President commented:

“The EITC has delivered excellent results. The recovery trend seen towards the end of last year is turning into a growth trajectory that brings revenues back to pre-COVID levels and improved profitability. We maintain a dynamic and proactive commercial approach: we will continue to launch new products and services for the benefit of our customers. Our transformation projects, a key enabler of these business initiatives, are progressing as planned. With these in mind and based on our strong results, I am pleased to announce that the Board of Directors has approved the distribution of an interim cash dividend of AED 0.11 per share.

Fahad Al Hassaoui, CEO, said:

“I’m really pleased with the performance this quarter. We have achieved three consecutive quarters of improvements and growth. Fundamentally, our services revenue has been and will continue to be a significant driver of profitability. Q2’22 services revenue hit a three-year high. Our commercial and investment efforts continue to bear fruit. We recorded a fourth consecutive quarter of net additions in the value-added postpaid segment. Our customer acquisition in consumer broadband services remains robust. We also actively manage our business efficiency to drive profitability. Cash generation will improve sustainably as our Capex program continues to normalize.

As the economy and population of the UAE grows, I am confident that we will continue to improve our positioning through the various initiatives we are launching.

-End-

About Emirates Integrated Telecommunications Company PJSC

Emirates Integrated Telecommunications Company PJSC (“EITC”) was founded in 2005. We are the second licensed telecom operator in the UAE. We operate under two brands: du (launched in 2007) and Virgin Mobile, the region’s first digital service (launched in September 2017).

We are listed on the Dubai Financial Market (DFM) and trade under the symbol DU (Bloomberg DU UH, Refinitiv Eikon DU.DU). Our main shareholders are government related entities (Eirates Investment Authority 50.12%, Emirates International Telecommunications Company LLC 19.7%, Mamoura Diversified Global Holding PJSC 10.06%).

Media contact Investor contact
Noora Al Mansoori Eric Chang
[email protected] [email protected]

Sean B. Jackson