Analysts expect that second quarter results from du, the upstart firm that broke Etisalat's domestic telecommunications monopoly, will show it has continued to trim losses and improve margins.
Upon launching its services last year, du announced that it expected to become profitable by the first quarter of 2009.
Weighed down by the costs of establishing the company and building a nationwide mobile network, du has reported losses of more than Dh1.6 billion (US$435.6 million) since it was founded in December 2005.
But the losses have shrunk in recent quarters, with the company becoming marginally profitable on an earnings before interest, tax, depreciation and amortisation (EBITDA) basis in the first quarter of this year. Second quarter results, due by the end of the month, are likely to show a continued improvement on this front.
An average of analyst expectations shows du making a Dh55m loss in the second quarter of this year. Estimates ranged between Emaar Saudi Financial Services predicting a Dh46.2m loss to EFG-Hermes predicting a Dh62m loss.
But analysts agreed that the company had continued to add new customers and improve operating margins in the quarter.
Thanks to an aggressive price-based campaign to gain new customers, du is expected to announce a total of 2.1 million subscribers. The company said it had crossed the two million mark in late May.
In a note to clients, Alok Nawani, an analyst for Emaar Financial, said du was "comfortably headed toward market share of 30 per cent by the end of 2008".
In second quarter results published last week, Etisalat reported 6.83 million subscribers, adding 200,000 new customers.
The report said that profits were up by 58 per cent on last year. The Dh3 billion profit was driven largely by a Dh1.78bn windfall from the sale of a quarter of the company's 35 per cent stake in Mobily, its new network in Saudi Arabia.
Etisalat also has begun to absorb the costs of its loss-making international operations, which are currently in start-up stages.
These operations, in growth markets like Egypt, Nigeria and Pakistan, are widely expected to begin contributing profits next year, at the same time that analysts foresee that du will begin making money.
Mr Nawani said he expected du's core operations to have become more profitable in the second quarter, with EBITDA margins for the period reaching 13 per cent, up three percentage points on the previous quarter.
As the burden of start-up costs is reduced and customer revenues grow, most analysts agree that du will approach real profitability by the end of this year.
But the financing cost associated with its new Dh3bn loan is also expected to rear its head for the first time in the coming quarter, costing the company an estimated Dh8m, a figure that will rise dramatically when the debt comes online in the second half of the year.
"The injection of additional debt to its capital structure has obvious cost implications," said Mr Nawani. "It may put pressure on the company's ability to meet its break-even target."
@Email:tgara@thenational.ae
Medicus AI
Started: 2016
Founder(s): Dr Baher Al Hakim, Dr Nadine Nehme and Makram Saleh
Based: Vienna, Austria; started in Dubai
Sector: Health Tech
Staff: 119
Funding: €7.7 million (Dh31m)
Napoleon
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Company%20Profile
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Company%20Profile
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THE%20STRANGERS'%20CASE
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Scores
New Zealand 266 for 9 in 50 overs
Pakistan 219 all out in 47.2 overs
New Zealand win by 47 runs
EA Sports FC 25
Developer: EA Vancouver, EA Romania
Publisher: EA Sports
Consoles: Nintendo Switch, PlayStation 4&5, Xbox One and Xbox Series X/S
Rating: 3.5/5
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
The specs
Price, base / as tested Dh1,470,000 (est)
Engine 6.9-litre twin-turbo W12
Gearbox eight-speed automatic
Power 626bhp @ 6,000rpm
Torque: 900Nm @ 1,350rpm
Fuel economy, combined 14.0L / 100km
PROFILE BOX
Company name: Overwrite.ai
Founder: Ayman Alashkar
Started: Established in 2020
Based: Dubai International Financial Centre, Dubai
Sector: PropTech
Initial investment: Self-funded by founder
Funding stage: Seed funding, in talks with angel investors
Jigra
Starring: Alia Bhatt, Vedang Raina, Manoj Pahwa, Harsh Singh
COMPANY%20PROFILE
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Nepotism is the name of the game
Salman Khan’s father, Salim Khan, is one of Bollywood’s most legendary screenwriters. Through his partnership with co-writer Javed Akhtar, Salim is credited with having paved the path for the Indian film industry’s blockbuster format in the 1970s. Something his son now rules the roost of. More importantly, the Salim-Javed duo also created the persona of the “angry young man” for Bollywood megastar Amitabh Bachchan in the 1970s, reflecting the angst of the average Indian. In choosing to be the ordinary man’s “hero” as opposed to a thespian in new Bollywood, Salman Khan remains tightly linked to his father’s oeuvre. Thanks dad.
The specs
Engine: 2-litre or 3-litre 4Motion all-wheel-drive Power: 250Nm (2-litre); 340 (3-litre) Torque: 450Nm Transmission: 8-speed automatic Starting price: From Dh212,000 On sale: Now
AIDA%20RETURNS
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COMPANY%20PROFILE
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Teaching your child to save
Pre-school (three - five years)
You can’t yet talk about investing or borrowing, but introduce a “classic” money bank and start putting gifts and allowances away. When the child wants a specific toy, have them save for it and help them track their progress.
Early childhood (six - eight years)
Replace the money bank with three jars labelled ‘saving’, ‘spending’ and ‘sharing’. Have the child divide their allowance into the three jars each week and explain their choices in splitting their pocket money. A guide could be 25 per cent saving, 50 per cent spending, 25 per cent for charity and gift-giving.
Middle childhood (nine - 11 years)
Open a bank savings account and help your child establish a budget and set a savings goal. Introduce the notion of ‘paying yourself first’ by putting away savings as soon as your allowance is paid.
Young teens (12 - 14 years)
Change your child’s allowance from weekly to monthly and help them pinpoint long-range goals such as a trip, so they can start longer-term saving and find new ways to increase their saving.
Teenage (15 - 18 years)
Discuss mutual expectations about university costs and identify what they can help fund and set goals. Don’t pay for everything, so they can experience the pride of contributing.
Young adulthood (19 - 22 years)
Discuss post-graduation plans and future life goals, quantify expenses such as first apartment, work wardrobe, holidays and help them continue to save towards these goals.
* JP Morgan Private Bank
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
Kamindu Mendis bio
Full name: Pasqual Handi Kamindu Dilanka Mendis
Born: September 30, 1998
Age: 20 years and 26 days
Nationality: Sri Lankan
Major teams Sri Lanka's Under 19 team
Batting style: Left-hander
Bowling style: Right-arm off-spin and slow left-arm orthodox (that's right!)
The specs
Engine: 2.0-litre 4-cyl turbo
Power: 201hp at 5,200rpm
Torque: 320Nm at 1,750-4,000rpm
Transmission: 6-speed auto
Fuel consumption: 8.7L/100km
Price: Dh133,900
On sale: now
If you go
The flights
Emirates and Etihad fly direct to Nairobi, with fares starting from Dh1,695. The resort can be reached from Nairobi via a 35-minute flight from Wilson Airport or Jomo Kenyatta International Airport, or by road, which takes at least three hours.
The rooms
Rooms at Fairmont Mount Kenya range from Dh1,870 per night for a deluxe room to Dh11,000 per night for the William Holden Cottage.
The specs
Engine: 1.5-litre turbo
Power: 181hp
Torque: 230Nm
Transmission: 6-speed automatic
Starting price: Dh79,000
On sale: Now
The specs
Engine: 2.0-litre 4-cyl, 48V hybrid
Transmission: eight-speed automatic
Power: 325bhp
Torque: 450Nm
Price: Dh289,000
COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
Sarfira
Director: Sudha Kongara Prasad
Starring: Akshay Kumar, Radhika Madan, Paresh Rawal
Rating: 2/5
GROUP RESULTS
Group A
Results
Ireland beat UAE by 226 runs
West Indies beat Netherlands by 54 runs
Group B
Results
Zimbabwe tied with Scotland
Nepal beat Hong Kong by five wickets