Du's Q1 net profit more than quadruples

Dubai telecom firm du said on Tuesday net profit before royalty in the first quarter more than quadrupled driven by subscriber growth, beating analysts' forecasts, while the outlook for its fixed line business remained strong.

Du, which recorded its first full-year profit in 2008, said in a statement net profit before royalty for the first quarter was Dh194 million ($52.83 million), compared with Dh47 million in the year-ago period.

Analysts in a Reuters survey in April forecast an average net profit of Dh97.2 million.

"The subscriber growth was the main driver behind du's highest mobile revenues for a quarter ever," the firm said in the statement.

"Outlook for our fixed line business ... remains strong with the prospect of a nationwide infrastructure agreement," the firm's Chief Executive Osman Sultan said.

Du, owned partly by the ruler of Dubai's investment company Dubai Holding and Abu Dhabi investment vehicle Mubadala Development Co, said it gained 262,000 mobile telephone customers in the three months to March 31, bringing its total active subscribers to 3.74 million.

The operator, which broke Emirates Telecommunications Corp's monopoly in 2007, said total revenue for the quarter rose 36 per cent from a year earlier to Dh1.6 billion.

In the first quarter du announced the launch of a rights issue intended to raise 1 billion dirhams of additional capital to fund infrastructure improvements beyond 2010.

The firm's shares have yet to trade on Tuesday on Dubai's bourse. 

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