Business News
COVID-19 takes a hit on du’s mobile revenues for first-half 2020
Jul
Dubai: The Dubai-based telco du recorded revenues of Dh5.66 billion for the first six months of 2020, helping it generate a net income of Dh570 million.
The COVID-19 outbreak placed a squeeze on du’s sales activity, changes in customer behavior, as well as dips in tourism and trade activity. There was a “contraction” in mobile and other revenues, though it was offset to some extent in fixed revenue generation.
Du has also proposed an interim dividend of 13 fils a share.
The second quarter mobile revenues were “under pressure due to the movement restrictions across the country, which led to an erosion of the base as a result of lower gross additions and a shift in customer behaviour from prepaid mobile usage to fixed usage as companies implemented work from home initiatives,” the operator said in a statement.
First-half mobile revenues declined to Dh2.81 billion, and driven from a “significant reduction in the prepaid customer base and the prepaid usage”.
“We have seen, as expected, a severe negative impact on our business coming mainly from mobile revenues, as we are structurally more exposed to the prepaid sector and from “other revenues” due to the lockdown and travel restrictions,” said Johan Dennelind, CEO of the operator in a statement.
“We have launched a cost efficiency programme to ease the pressure on our bottom-line, the extent of which will also depend on the speed of the market recovery post lockdown.”
226,000
Du’s fixed-line customer base tally at the end of second quarter. This is a gain of 6.8 per cent from last year.
Sticking to capital investments
Du’s mobile subscriber base was at 6.42 million at the end of June, and down from a year ago.
Mohamed Hadi Al Hussaini, Chairman of Emirates Integrated Telecommunications Co., said: “Despite a challenging environment that adversely impacted our results for the quarter, we continued our transformation programme, particularly on the digital front.
“We remain committed to continue investing in our business to sustain long-term value creation. Our capex spend for the half-year period was up by 75.3 per cent to Dh819 million, equivalent to 14.5 per cent of our half-year revenues.”
Our strong balance-sheet and solid cash position allowed us to proceed with an interim dividend
