ABU DHABI, (Reuters) – Emirates Telecommunications Corp (Etisalat) made a second-quarter net profit of 2.41 billion dirhams ($656.1 million), down 19 percent from a year earlier but beating forecasts.
The company posted a first-half net profit of 4.59 billion dirhams, compared with 5 billion dirhams a year earlier, saying in a statement that last year’s results included 892 million dirhams earned from an asset sale. Reuters calculated the quarterly profit based on previous financial statements.
Analysts had forecast on average that Etisalat, one of the largest Arab telecom companies, would post a second-quarter profit of about 2.22 billion dirhams, in a Reuters survey earlier this month.
Earnings per share were 0.64 dirham in the first half versus 0.70 dirham a year earlier, the statement said, adding that last year’s figure would be 0.58 dirham after excluding income from the asset sale.
Revenues grew 10 percent in the first half to 14.74 billion dirhams from a year earlier while total assets stood at 67.24 billion dirhams at end-June 2009, up 7 percent.
MORE SELECTIVE EXPANSION OVERSEAS
“The growth in revenues achieved will help us expand and develop our national and international business units,” Mohammed Omran, chairman of Etisalat, said in the statement.
“We have reduced our operational expenditure in the period and have become even more selective in choosing our international investments. We are achieving this by making use of the current financial environment and searching for positive opportunities that arise during these times,” Omran said.
The telecom firm has been expanding overseas as it faces stiffer competition in its home market of the United Arab Emirates, where some analysts have predicted that job cuts could reduce population, weighing on profits of Etisalat and rival du DU.DU.
Etisalat has more than 85 million subscribers from a population base of 1.7 billion people, and expects subscriber numbers to reach 100 million in 2010, Omran said.
CEO Mohammed al-Qamzi said the company also saw areas of expansion in its home market, where he said mobile penetration had exceeded 200 percent.
“This high penetration rate reduces the opportunities for growth in number of subscribers, and gives a chance for cumulative growth in terms of rates, minutes of use and data traffic through mobile phones and 3G services,” Qamzi said.