Emirates Integrated Telecommunications Company (EITC) has announced a remarkable 46.3% rise in its second-quarter (Q2) net profit, reaching AED581 million ($158.2 million), as revenues surged by 7.3% to AED3.6 billion, driven by robust product offerings.
EITC’s EBITDA rose by 3.2% to AED1.6 billion, reflecting the growth in revenues. The net profit of AED581 million represents a 46.3% year-over-year increase, primarily due to the substantial EBITDA growth. Capital expenditure (Capex) stood at AED442 million, while Operating Free Cash Flow (EBITDA – Capex) increased by 10.9% year-over-year to AED1.1 billion.
Subscriber Growth and Product Success
EITC’s mobile customer base grew by 2.9% year-over-year to 8.2 million subscribers, despite a slight dip over the quarter due to typical seasonality. The postpaid customer base saw an impressive 11.3% year-over-year increase to 1.7 million subscribers, underscoring the appeal of EITC’s innovative enterprise connectivity solutions and successful consumer products like “du Smart Car.” The prepaid customer base grew by 0.9% to 6.5 million customers, with voice and data growth balanced by a normalization of the tourist influx.
EITC’s fixed customer base grew by 12.7% year-over-year to 630,000 subscribers, with 15,000 net additions over the quarter. The company’s Home Wireless plans were the main growth driver, enhanced by new offerings like Home Wireless Gaming, while enterprise connectivity also performed strongly during the quarter.
Financial Highlights
Revenues increased by 7.3% year-over-year to AED3,592 million, buoyed by strong growth in mobile and “other revenues.” Mobile service revenues grew 6.6% year-over-year to AED1,612 million, driven by robust postpaid revenue growth, increased enterprise sector demand, and the success of innovative offers. Fixed service revenues increased by 3.5% to AED982 million, attributed to the Home Wireless product and enterprise broadband plans. “Other revenues” rose by 12.7% to AED998 million, fueled by strong growth in ICT and wholesale services.
EBITDA grew by 3.2% to AED1,570 million, with an EBITDA margin of 43.7%. Excluding Q2 2023’s positive one-off, EITC achieved high single-digit EBITDA growth year-over-year. The EBITDA margin expanded by over 1 point year-over-year on a normalized basis. Capex was AED442 million (Q2 2023: AED504 million), with capital intensity moderating to 12.3% (Q2 2023: 15.1%) in line with typical capex phasing. EITC’s investment program focuses on enhancing 5G coverage, fiber deployment, and transforming its IT and network infrastructure.
Operating free cash flow (EBITDA – Capex) rose by 10.9% to AED1,127 million, reflecting EBITDA growth and Capex moderation.
Achieving Record Results
Malek Al Malek, Chairman, stated: “The first half of 2024 saw EITC deliver another record set of results. The management remained focused on strategy execution, delivering profitable growth in our core business and beyond, and creating value for our shareholders. The company remained at the forefront of technological innovation to offer the best experience to our customers in areas including Fintech and AI.
“Our strategy to deliver unmatched experiences to customers has resulted in the du brand now being the 3rd strongest in the UAE. The country’s macro-economic environment was very supportive of our activity, and we remain well-positioned to support the UAE government’s digital strategy. This is demonstrated by our plan to launch Hyperscale Cloud and Sovereign AI Services for the Government. Reflecting our dedication to excellence in governance, we made strategic additions to our Board of Directors by welcoming four new members with valuable experience and perspectives. In light of our sustained strong performance and healthy balance sheet, I am pleased to announce that the Board of Directors approved the distribution of an interim cash dividend of AED0.20 per share, representing a 53.8% increase compared to the interim dividends of 2023. This reflects the Board’s confidence in the company’s ongoing success and outlook and our commitment to delivering value to our shareholders.”
Fahad Al Hassawi, CEO, commented: “Our unwavering commitment to excellence, focused strategy, and efficient resource management have enabled us to deliver another strong operational and financial performance in the second quarter. We have grown our subscriber base, revenues, profitability, and cash generation, solidifying the stellar start we made this year.
Commercial Momentum and Innovation
“Our commercial momentum led to strong growth in our service revenues in Q2, buoyed by significant large enterprise deals and a robust pipeline of new projects, as well as the launch of innovative consumer products. In Fintech, the first full quarter of du Pay exceeded our expectations, marking a significant milestone in our innovation journey and further expanding our market reach capabilities. Our results for the first half give us full confidence in delivering our upward revised full-year financial guidance. Going forward, we will remain focused on executing our strategy, committed to investing in our future, enhancing 5G coverage, and continuing to transform our IT and network infrastructure, thus building a solid foundation for long-term growth and creating value for our shareholders.”
