Etisalat announces financial results for first half 2008

The company reported Dhs2,995m in net profits for the second quarter. This takes net profits for the first half of 2008 to 5,118m, an increase of 37.1% on 2007 figures. Net profits in the second quarter of 2007 were recorded at Dhs1,895m and Dhs3,732m for the first half of 2007.

Etisalat recorded net revenues of Dhs6,383m for the second quarter of 2008 and Dhs12,443m in total for the first half of the year. This shows an increase of 24%, compared to the first half of 2007 (Dhs10,059m). Total assets recorded were Dhs30,704m an increase of 19% (Dhs4,809m) compared to last year's total. Profits per share for the first six months increased to reach Dhs0.85 against Dhs0.62 for the same period in 2007.

Compared to the same period last year, the operating profit excluding the impact of Federal royalty on gain on disposal of shares in an associate (Etihad Etisalat Company) increased by Dhs555m to Dhs4,035m.

H.E. Mohammad Hassan Omran, Chairman of Etisalat, said:

"Etisalat's results in the first half of the year and in the second quarter in particular, have been excellent. Our subscriber numbers continue to grow strongly and in the UAE alone, mobile phone customers have reached 6.83 million customers an increase of 7% compared to the end of 2007. We are also pleased to see that the number of total fixed line customers with Etisalat is now 1.35 million and that the number of internet customers has now reached 1.02 million."

Omran added: "Etisalat has achieved several major landmarks during 2008. Earlier we attained the rank of the largest telecommunications company in the Middle East and one of the 14 largest in the world - a clear sign that our strategy to become one of the largest ten operators is on track."

In accordance with the Saudi Royal Decree establishing Etihad Etisalat Company, the founding shareholders were required to reduce the shares by 20% within the first three years of the company's incorporation. Accordingly Etisalat reduced its equity interest in Etihad Etisalat from 35% to 26.25%. The transaction was completed and the proceeds from disposal were received by the corporation in April. Gain on disposal of these shares amounting to Dhs1,784m was recognized by the corporation in the second quarter of 2008.

On May 12, the Group acquired an additional 12% (118,719 shares) of the equity in Atlantique Telecom for a consideration of Dhs251m. This increased the corporation's shareholding to 82% (811,244 shares).

Also during the quarter, Etisalat's commitment to transparency with regards to its financial data and investors was acknowledged by local authorities. Etisalat was presented the SCA Diamond Standard for Financial Transparency for the year 2007 according to Securities and Commodities Authority that has named Etisalat as a 'Diamond' company in terms of financial transparency.

Etisalat has also augmented its world class services for the region through global roaming partnerships that today connects Etisalat customers with 510 operators around the world. Today Etisalat customers can stay connected while roaming in up to 186 countries, using BlackBerry, 3G or GPRS or just simple voice and SMS services.

Etisalat has also signed an agreement with "iPass" to support travelers wishing to access Internet services. This agreement will help keeps Internet customers connected to the Internet at over 60,000 locations in 150 countries around the world via Etisalat's own Internet services, removing the need for the customer to sign up to local subscriptions.

Main services launched in the second quarter of 2008:
• Mobile NFC (Near Field Communication) payments: a pilot program with Emirates Bank and National Bank of Dubai, allowing customers to make payments using their mobile phones.
• Launch of new high speed Internet leased lines ranging from 200 Mbps to 1 Gbps.
• Launch of a new software application to upload photos to their Facebook profiles using Multimedia Messaging Service (MMS).
• Launch of a 3.5G Router, that allows up to 32 people to browse 3.5G Mobile Broadband Internet simultaneously using one SIM card.
• Launch of eCafe service allowing internet cafes within the UAE to get new higher speed internet packages.