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20 May 2024

Du reports first annual profit

Customers pay the cashier at the du customers service centre in Al Ain (NASSER BABU)

By Reuters
Dubai-based telecom firm du earned Dh78 million in the fourth quarter, at the upper end of expectations, pushing the group to its first full year profit since launching mobile services in February 2007.

Du posted a 2008 full year net profit of Dh4.124 million in 2008, compared with a loss of Dh885.27 million in 2007.

Quarterly revenue rose to Dh1.23 billion, nearly double compared to the same period last year, the company said in a statement on Monday.

The telecom firm also said it had doubled mobile phone subscriptions compared to last year, with the number of its active mobile phone subscribers reaching 2.498 million.

Fixed line subscription grew by 72 per cent year-on-year to to 280,000 active subscribers, the firm said.

Analysts' forecasts for the firms's fourth-quarter profit ranged from Dh45.22 million to Dh83.03 million in a Reuters survey last month.

The company said it would invest up to Dh2 billion ($544.5 million) in 2009 to strengthen its telecommunications infrastructure.

Du made a loss of Dh146.65 million in the fourth quarter of 2007 and a loss of Dh74.03 million in the first nine months of 2008.

The firm turned its first profit in the third quarter of 2008, a year ahead of plan, posting a profit of Dh31.47 million due to growth in subscriber numbers and a one-time gain.

Fourth-quarter net profit of Etisalat fell 19.3 per cent to Dh1.42 billion ($386.6 million), missing analyst forecasts.

Shares in du lost 70 per cent in the last year to Sunday's close, underperforming Etisalat, whose shares lost only around half their value.

At a briefing in Dubai in mid-December, EFG-Hermes said Etisalat and du together had around 9.1 million active subscribers at the end of September 2008 in the UAE, which is home to about 5.05 million people and where penetration exceeds 180 per cent.