Etisalat announces strong results for Q1 2014

Etisalat Group yesterday announced its consolidated financial statements for thethree months ending 31st March 2014.Ahmad Abdulkarim Julfar, Group Chief Executive Officer, Etisalat, commented: "Weachieved strong financial results in the first quarter of 2014, building on our strongperformance in 2013. Our focus on innovative products and services that change theway people live their lives further supported customer retention while at the sametime attracting new subscribers to our brand." In the first quarter of 2014, Etisalatsuccessfully deployed LTE (Long-Term Evolution) Advanced technology (LTE-A); astandard for high-speed mobile data communication, for the first time in the regionon 1800 MHz and 800 MHz bands. Julfar said: "The strong momentum built up byour data business in 2013 continued in the first quarter of 2014, and this segmentwill remain a strategic priority for the company. The successful LTE-A deployment issignificant as it provides significant new opportunities in commercialising the datasegment." He elaborated: "Being able to help millions of customers to navigate the digital eco-system requires Etisalat to continually invest and innovate to keep pacewith the growing demand for mobile data within our networks. This growth alsocontributes to our efforts in strengthening mobile banking solutions in the marketswhere Etisalat operates.Julfar continued, "We will continue to expand our service offering and geographicfootprint in order to diversify our revenue base and cement our regional leadershipposition. Africa remains a strategic region for our business and we will continue toinvest and build even closer relationships with the communities in which we operatein the continent." He added: "We are also proud to have made a significantcontribution to the UAE's m-government strategy this quarter with the launch of our2G trade-in initiative. Etisalat Group believes in supporting initiatives that are ofbenefit to local communities and this initiative will make smartphone technologyavailable and affordable for many more people in the UAE" Etisalat Groupaggregate subscriber base grew to 145 million by end of March 2014 representingyear over year growth of 3%.In the UAE, the active subscriber base grew to 10.9 million subscribers in March2014 representing year over year growth of 16%. Etisalat UAE strengthened itscompetitive position in Q1 2014 by reinforcing its leadership in high-valuesegments in both the mobile and fixed segments. As a result, in the UAE, the mobilesubscriber base grew by 20% to reach 8.9m subscribers. Fixed line subscribersincluding eLife and broadband segments increased to 2 million representing a yearon year growth of 2%.Etisalat Group's consolidated revenue in the first quarter of 2014 amounted to Dh9.9 billion with growth accelerating to 3% in comparison to the same period last year.In the UAE, revenues of Dh6.5 billion for the first quarter of 2014 were 8% higherthan the first quarter of 2013. This growth was mainly as a result of increaseddemand for eLife services, handset sales and mobile data.Revenue from international consolidated operations reached to Dh3.3 billion,representing 34% of consolidated revenues.In December 2012, a new royalty mechanism for the telecom operators wasestablished by the Federal Government in the UAE As per the new royalty mechanism, Etisalat is required to pay 15% royalty fee on the UAE regulatedrevenues and 35% of net profit after deduction of 15% royalty fee on the UAEregulated revenues. 35% royalty fee on profits from international operations isnetted off with the corporate taxes paid/payable in the respective foreign countries.Federal Royalty for the first quarter of 2014 amounted to Dh 1.9 billion,representing a year-over-year increase of 4%. This resulted in an effective royaltyrate of 48% on net profit before Federal Royalty in comparison to 50% in the samequarter prior year. Consolidated net profit after Federal Royalty increased year-over-year by 11% to Dh2billion in the first quarter of 2014.Earnings per share (EPS) amounted to 26 fils in the first quarter of 2014, an increaseof 11% from the same period last year.