The financial figures for the third quarter of 2021 were released by Emirates Integrated Telecommunications Company PJSC (“EITC”). On continued demand for broadband services and 5G devices, revenue increased 6.9% to AED 2,874 million.
More crucially, thanks to a strong postpaid market, mobile services continued to improve. Cost management helped reduce margin pressure from direct costs, resulting in EBITDA of AED 1,100 million. Despite greater depreciation and amortization expenses, the net profit was AED 283 million.
Fahad Al Hassawi, CEO, said “I am very pleased that consumer and corporate confidence are on the mend. Our fixed services business delivered another solid quarter. Broadband net-adds accelerated to 52k thanks to an attractive service offering. In addition, we see corporate demand for fixed services returning.”
He added, “Our commercial initiatives in mobile services are bearing fruit. The refreshed prepaid mobile tariffs are pushing gross-adds on the prepaid segment towards pre-pandemic levels. Our enhanced postpaid tariff plan stimulates usage and supports a pathway to ARPU growth. This quarter is an inflection point for mobile service revenues: we renewed with nominal growth (+0.7% quarter-on-quarter) after three consecutive quarters of decline.”
He also said, “Following two years of capital deployment, I am pleased to announce that our 5G network is now accessible to 90% of the population. The next milestone is to ultimately ensure seamless access for all residents. We remain committed to delivering value for our customers and will continue to be a market differentiator.”
- Mobile customer base reached 6.5 million. The postpaid segment remains resilient with net-adds of 13k. The postpaid customer base grew to 1.3 million due to an improved digital Customer Experience and enhancements to the Power Plans. The prepaid customer base declined to 5.2 million subscribers due to a combination of summer seasonality and flight restrictions brought by the Covid-19 Delta variant.
- Sustained commercial momentum in Fixed services across various product categories. The simplicity of our consumer offer helped accelerate net-adds to 52k. We ended the quarter with 331k broadband customers. Demand from the Enterprise segment is also returning.
- Capital deployment plan is bearing fruits. Following significant deployment, our 5G network covers 90% of the population, and independent tests confirmed our network was the fastest during the quarter. In addition, we inaugurated two data centres, KIZAD in Abu Dhabi and Dubai Silicon Oasis. These centers have an aggregate capacity of 2.7MW.
- Revenues grew 6.9% yoy to AED 2,874million. Fixed revenues grew 14.7% to AED731 million as the consumer and enterprise segments continue to perform well. “Other revenues” increased 16.6% to AED 839 million due to doubling handset sales and higher wholesale revenues. A resurgent postpaid segment ignited the recovery of mobile revenue to AED 1,304 million.
- EBITDA retreated by 4.9% yoy to AED 1,100 million. Our cost optimization plan continues to yield results. We have rationalized marketing and G&A spend. We have improved our collections, therefore, reducing provisions on receivables. These various initiatives mitigated pressure from direct costs (product costs, interconnect costs).
- Net profit (adjusted) declined by7.1% to AED 283 million. Depreciation and amortization increased due to our ambitious investment program. The disposal of Khazna Data Center in 2020 reduced the contribution from associates.
- Capex dropped 27.3% to AED 372 million due to phasing of expenditure. As a result, operating free cash flow increased to AED 728 million.
|AED million||Q3 2020||Q3 2021||change|
|Net profit (adjusted)1||305||283||-7.1%|
|Net profit (reported)||824||283||-65.6%|
|Operating free cash flow||645||728||12.8%|