Du posts 42.7% profit increase in Q3 with highest quarterly profit in three years

Dubai telco reports rise in both mobile and fixed services revenues

Du's mobile customer base increased 2.7 per cent annually to 8.3 million subscribers in the last quarter. Sarah Dea / The National

Emirates Integrated Telecommunications Company, the Dubai telecoms operator known as du, reported a 42.7 per cent increase in its third-quarter net profit – its highest quarterly profit in three years – driven by a surge in customers and rising revenue.

Net profit for the three months to the end of September was Dh719 million ($196 million), the company said on Monday in a filing to the Dubai Financial Market, where its shares are traded.

Revenue rose about 9.1 per cent annually to nearly Dh3.6 billion, driven by a 7 per cent growth in mobile services revenue to more than Dh1.6 billion. Fixed service revenue stood at over Dh1 billion, up 7.9 per cent.

The company’s mobile customer base increased 2.7 per cent annually to 8.3 million subscribers. It reported 71,000 net-additions in the July-September period and 218,000 over the past 12 months.

The company said the growth was driven by a “robust 12.5 per cent growth in postpaid subscriber base supported by … compelling consumer offers, such as unlimited data plans and special roaming bundles for the holiday season”.

Its fixed customer base grew 14.2 per cent annually to 655,000 subscribers, with 24,000 net-additions in the last quarter and 81,000 over the past one year.

Du's nine-month profit, meanwhile, surged 49.7 per cent to more than Dh1.9 billion as revenue rose 6.8 per cent to nearly Dh10.8 billion.

“We continued to execute our strategy of strengthening our core connectivity business while selectively expanding beyond the core to position ourselves as a leading integrated digital services enabler,” said Fahad Al Hassawi, du’s chief executive.

“These results highlight the alignment of our products with customer needs and the high quality of our infrastructure. Our strong cash generation and healthy balance sheet provide us with the flexibility to invest in future growth opportunities and deliver strong returns to our shareholders.”

Du is also aiming to offer “affordable and accessible” cloud and artificial intelligence services in the UAE as it prepares to launch them locally next year.

The company will start by offering cloud and AI services to government agencies by the first half of 2025, competing with major players like Microsoft, Amazon and Google in the UAE market, Mr Hassawi told The National in September.

In the third quarter, du's earnings before interest, taxes, depreciation and amortisation (Ebitda) increased 16.9 per cent on a yearly basis to over Dh1.7 billion.

Ebitda growth was driven by a “combination of revenue growth, an improved revenue mix and an effective management of operating expenses”, the company said.

Du’s capital expenditure for the last quarter stood at Dh511 million. The company said it will continue extending its 5G coverage focusing on densification and indoor coverage, as well as introducing fibre in new and existing developments.

The company's operating free cash flow increased by 27.9 per cent to more than Dh1.2 billion.