Emirates Integrated Telecommunications Company PJSC (du) has released its financial results for the third quarter of 2024, showcasing impressive topline growth of 9.1 percent alongside a substantial EBITDA increase of 16.9 percent. The Q3 EBITDA margin reached 48.3 percent, marking the highest level since the company’s inception. During this quarter, net profit surged to AED719 million, representing the highest quarterly net profit in the past three years. For the first nine months of the year, net profit climbed by an impressive 49.7 percent to reach AED1.9 billion ($517.2 million). This remarkable financial performance is attributed to sustained commercial momentum, effective execution of strategic initiatives, and diligent cost management. Notable achievements have been made in the connectivity sector and beyond, reflecting du’s transformation from a traditional telecom operator into a leading provider of Telecom and Digital Services.
Revenue growth and profitability
In the third quarter of 2024, the company demonstrated robust commercial momentum, achieving a 9.1 percent year-on-year revenue increase. Total revenues reached AED3.6 billion, highlighting a solid topline performance. Profitability also improved significantly, with EBITDA rising by 16.9 percent to AED1.7 billion. This growth resulted in a record EBITDA margin of 48.3 percent, indicative of enhanced operational efficiency and effective cost control measures.
Remarkable net profit increase
Net profit experienced an impressive rise of 42.7 percent, reaching AED0.7 billion, thereby marking the highest quarterly net profit recorded over the last three years. Capital expenditures have begun to normalize, reflecting a capital intensity of 12.2 percent over the first nine months of 2024.
Strategic initiatives in B2B
In the B2B segment, a strategic portfolio overhaul introduced two new sub-brands, broadening offerings and expanding market reach. Additionally, du established a global partnership with Orange, aimed at driving innovation and furthering digital transformation initiatives.
Commitment to innovation
Commenting on the developments and performance in Q3, CEO Fahad Al Hassawi noted that in the third quarter, the company continued to execute its strategy of reinforcing its core connectivity business while selectively expanding beyond its primary focus to position itself as a leading integrated digital services enabler. He explained that the recent revamp of the operating brands, including the introduction of du Tech and du Infra, illustrates a strategic pivot toward comprehensive digital transformation across services, emphasizing a commitment to innovation and the creation of dynamic digital ecosystems.
Future growth and investment plans
He added that the successful execution of the strategy has resulted in another quarter of strong financial performance and that the company’s robust cash generation and healthy balance sheet provide the flexibility to invest in future growth opportunities while delivering substantial returns to shareholders. He expressed confidence in achieving the company’s targets and reaffirmed the guidance for 2024.
Strategic partnerships and collaborations
In August 2024, du and etisalat by e& announced a strategic partnership with Nakheel, a member of Dubai Holding, to provide advanced fixed telecommunications services and enhance ICT infrastructure in upcoming developments. This collaboration, aligned with the Taawun infrastructure deployment initiative, will further ensure a strong telecommunications infrastructure across Nakheel’s key projects.
Also in August 2024, e& and du reported a federal royalty payment of AED3.54 billion ($963.78 million) to the UAE government for the first half of the year, compared to AED3.73 billion ($1.01 billion) for the same period in 2023, as outlined by the Ministry of Finance’s Royalty Guidelines.
Aggregate royalty obligations
According to the financial results disclosed by both companies on market websites, the total royalty payable by the e& group in the first half of 2024 amounted to AED2.749 billion ($748.43 million), slightly down from AED2.75 billion in the first half of 2023. Meanwhile, du contributed AED797.6 million ($217.15 million) in the first half of 2024, a decrease from AED978.9 million for the same period last year.
From 2012 to 2023, the combined royalty payments from the two telecom operators totaled AED90.3 billion or $24.58 billion (comprising AED70.6 billion from e& and AED19.7 billion from du).
In November 2023, e& and du announced the receipt of the Royalty Guidelines for the local telecom sector, issued by the Ministry of Finance, covering the period from January 2024 through December 2026.
Notable profit increase in H1 2024
In July 2024, du reported a significant increase in its net profit for the first half of 2024 (H1 2024), soaring by 54.2 percent to AED1.184 billion ($322.35 million), compared to AED768 million ($209.09 million) in H1 2023. Concurrently, the company’s revenue grew by 5.7 percent to AED7.174 billion, up from AED6.787 billion in the same period last year.
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