Telecom Operator Du Reports Dh1.44b Net Income
Telecom Operator Du Reports Dh1.44b Net Income: Telecommunications company Emirates Integrated Telecommunications Company (EITC), operating as du in the UAE, disclosed a net income of Dh1.44 billion for the entirety of 2020, marking a decline from the Dh1.73 billion reported in the previous year.
In the fourth quarter of 2020, du reported a net income of Dh48 million, impacted by a one-time goodwill write-off of Dh137 million related to its broadcasting business, affected by the challenges posed by the Covid-19 pandemic. Excluding this exceptional circumstance, the net income for the fourth quarter stood at Dh185 million. The company demonstrated robust performance in navigating the challenging business environment caused by the pandemic. EITC's capital expenditure rose by 24.1% year-over-year to Dh1.87 billion, reflecting a capital intensity of 16.9%, the highest level observed in the last five years.
The board of du recommended a dividend distribution of 28 fils per share, with 13 fils per share already paid in August 2020 as an interim dividend.
Du, headquartered in Dubai, experienced a 1.9% increase in fourth-quarter revenues compared to the third quarter of 2020, amounting to Dh2.74 billion. This marked two consecutive quarters of growth in 2020, indicating ongoing economic recovery. Revenues for the full year 2020 reached Dh11.08 billion. Fourth-quarter mobile revenues remained nearly stable at Dh1.32 billion, while fixed revenues were recorded at Dh645 million. Full-year 2020 fixed revenues increased by three percent to Dh2.57 billion compared to the previous year.
Du's fourth-quarter EBITDA stood at Dh1.03 billion, demonstrating contained erosion as the company executed cost optimization initiatives to enhance operational efficiency. The EBITDA for the entire year was Dh4.51 billion, reflecting a solid EBITDA margin of 40.7%.
Commenting on the financial results, Mohamed Al Hussaini, Chairman of EITC, expressed satisfaction in successfully navigating the turbulent environment, ensuring the efficient provision of telecommunication services crucial to the economy and community. Al Hussaini emphasized the commitment to further developing and modernizing infrastructure through increased capital expenditure, reaching Dh1.87 billion in 2020, primarily utilized for network enhancement and the continued rollout of 5G.
Fahad Al Hassawi, Acting CEO of EITC, noted positive momentum in the second half of 2020, with gradual normalization observed in economic activity, trade, and tourism. Du reported two consecutive quarters of positive revenue growth in the third and fourth quarters of 2020, signaling a promising trend toward recovery.
