Etisalat Q2 profit falls 14.9 pct, misses analysts view

Etisalat Q2 profit falls 14.9 pct, misses analysts view

Q2 misses analysts expectations; Higher operating costs hurt profits; Sets interim dividend of 25 fils/share

July 18, 2011 2:47 by Reuters

Etisalat , the United Arab Emirates’ largest carrier, said its second-quarter net profit fell 14.9 percent on Monday, missing analyst expectations amid a rise in operating costs.
The former monopoly, which operates in 18 countries, reported a second-quarter profit of 1.59 billion dirhams ($433 million), down from 1.87 billion dirhams in the year-earlier period. Etisalat posted second quarter revenue of 7.93 billion dirhams compared with 8.05 billion dirhams year-ago.
Analysts polled by Reuters on average had expected the firm to post a quarterly profit of 1.87 billion dirhams.
Staff and operating costs climbed 17.5 percent to 1.25 billion dirhams in the quarter compared with the year-ago period, Etisalat said in a statement.
For the first half of 2011, the telco made a net profit of 3.4 billion and revenue of 15.96 billion dirhams. It set an interim dividend of 25 fils per share for the year.
The firm said it had 7.5 million mobile subscribers, 1.1 million fixed lined subscribers and 1.4 million internet subscribers at the end of the first half, without giving comparative figures for the prior year period.
Etisalat also said it recorded 318 million dirhams as a provision for estimated indirect tax liabilities from one of its overseas subsidiaries.
Earlier this month, the firm said its Indian mobile phone joint venture partner has brought “proceedings” against it and various group companies before the Company Law Board in India. (Reporting by Shaheen Pasha, Editing by Dinesh Nair)