LONDON, Aug 3 (Reuters) – UAE telecoms carrier du on Wednesday said its second-quarter net profit rose 51 percent, beating analysts’ expectations, as customers increased spending and it gained more market share from former monopoly Etisilat.

The operator, which ended Etisalat’s domestic monopoly in 2007, reported a second-quarter net profit of 207.2 million dirhams ($56.4 million) after provisioning to pay 50 percent of its profit in royalties in 2011. This net figure is up from 137.4 million dirhams in the year-earlier period.

Four analysts polled by Reuters forecast du would make a quarterly profit of between 188 million and 235 million dirhams.

“These look like a good set of results — revenues, EBIDTA, customer share and free cash flow continue along a good trajectory,” said Martin Mabbutt, Nomura telecoms analyst.

“Du is addressing a market that is not very competitive - Etisalat has traditionally earned a very high return, with margins of more than 60 percent, so it’s quite an easy target.”

Etisalat’s second-quarter profit fell 14.9 percent, its second straight quarterly decline.

Du’s second-quarter mobile revenue rose 32 percent to 1.66 billion dirhams, with the Dubai-based carrier now claiming 44 percent of the UAE’s mobile subscriptions, up from 41.6 percent in the first-quarter.

* Three telcos must IPO by August-end, but reluctant to list

* Low liquidity, small mkt cap seen hurting valuations

* Penalty a smaller price to pay than poor IPOs

By Matt Smith

DUBAI, July 20(Reuters) – It was meant to symbolise the triumph of capitalism in post-Saddam Hussein Iraq.

But the stock market flotation of three Iraqi telecoms firms, required by law to go public by the end of August, is stuck, with the operators holding out for better market conditions and higher valuations.

As a result, all three are likely to miss the deadline in a move unwelcome to the Baghdad bourse and the telecom regulator.     Zain Iraq, part of Kuwait’s Zain , Qatar Telecom’s Asiacell and France Telecom affiliate Korek have dragged their feet on selling 25 percent stakes and listing on the Iraq Stock Exchange.

DUBAI, July 18 (Reuters) – Etisalat , the United Arab Emirates’ largest telecoms carrier, said on Monday its second-quarter net profit fell 14.9 percent, missing analysts’ forecasts, as operating costs rose amid increasing competition in its home market.

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.

Analysts polled by Reuters forecast the firm would post a quarterly profit of 1.88 billion dirhams.

“Revenues were lower than our expectations while costs were higher,” said Nishit Lakhotia, telecoms analyst at Securities & Investment Co (SICO) in Bahrain. “Etisalat has been facing tough competition at home, which is its key market, contributing more than 70 percent of Etisalat’s revenues.”

Quarterly staff costs climbed 17.5 percent to 1.25 billion dirhams compared with a year ago, Etisalat said in a statement.

Etisalat, which dropped plans to buy a controlling stake in Kuwait’s Zain earlier this year, posted second-quarter revenue of 7.93 billion dirhams, down from 8.05 billion dirhams a year earlier.

“Etisalat must be aggressive defending its home market share - it has lost a lot of ground to du over the past year, especially in the post-paid segment,” Lakhotia said.

DUBAI, July 14 (Reuters) – Vodafone Qatar on Thursday said its first-quarter loss narrowed as mobile subscriber numbers rose, while the carrier also named a new chief executive.

The firm made a loss of 122.3 million riyals ($33.59 million) in the three months ending June 30, compared with a net loss of 148.1 million riyals a year earlier, it said in a statement. Two analysts forecast a first-quarter loss of between 137 million and 143.5 million riyals.

Revenues rose 65 percent to 290.6 million riyals, while earnings before interest, tax, depreciation and amortisation (EBITDA) for the three months ending June 30 was 31 million riyals. Vodafone Qatar’s financial year starts on April 1.

“Achieving continued EBITDA success is very important as this is a key factor in our ability to pay dividends to our shareholders,” said John Tombleson, acting chief executive, adding the carrier was on track to pay dividends in the financial year ending March 31, 2013.

The carrier, which ended Qatar Telecom’s domestic monopoly in 2009, had 761,000 subscribers as of June 30, up 43 percent from a year earlier, allowing it to claim a 23.4 percent share of Qatar’s mobile revenues.

Richard Daly will become chief executive on September 4, the firm said in a separate statement, while Steve Walters has been appointed chief financial officer, effective from October.

Former CEO Grahame Maher died in November. ($1 = 3.641 Qatar Riyals)

DUBAI, July 12 (Reuters) – Telecoms carrier Zain Sudan is in talks with South Sudan to obtain a licence to operate in the newly independent country, the firm’s managing director said on Tuesday.

South Sudan seceded from the north on Saturday, the culmination of a 2005 peace deal that ended decades of civil war.

Zain Sudan, a unit of Kuwait’s Zain and one of three mobile telecoms carriers licensed from Khartoum, will continue to operate in the South as usual until a new licence is agreed, managing director Elfatih Erwa told Reuters.

Erwa ruled out asking north Sudan to refund some its estimated 200 million euros licence fee to offset the cost of the new South licence. The firm will split its Sudan operations after South Sudan obtains an international dialling code.

Zain Sudan’s 57 percent mobile market share generated revenues of $273 million in the first quarter – almost a quarter of Zain group’s total — but just 6 percent of this came from the South. The carrier had 10.7 million Sudan subscribers on March 31, up 21 percent from a year earlier.

Only 1 million of South Sudan’s estimated 8 million people have mobile phones, but this will likely treble within two years, Erwa said.

South Sudan is considered one of the world’s least-developed nations. The territory is about the size of France but is estimated by some officials to have just 50 km of paved roads.

DUBAI, July 3 (Reuters) – Zain Iraq faces “a big challenge” to meet an August deadline to launch an initial public offering and may end up floating less than a regulator-mandated 25-percent stake, its chief executive said.

The operator, a unit of Kuwait’s Zain , must become a listed joint stock company by the end of August.

“We have started the process some time ago,” Zain Iraq Chief Executive Emad Makiya said by email. “However, meeting the deadline would be a big challenge.”

Under the terms of licences issued in 2007, Zain Iraq and rival operators Asiacell, an affiliate of Qatar Telecom (Qtel), and Korek — part-owned by France Telecom — must sell 25 percent of their shares and list on the Iraq Stock Exchange (ISX) by August-end.

With less than nine weeks to the deadline and the Muslim holy month of Ramadan due to start in early August, the three carriers have offered only vague assurances of their intentions to list.

“We are talking to the regulator and ISX about what is the best approach for the country,” said Makiya, when asked if he had asked the telecoms regulator — the Communications and Media Commission — and ISX about postponing the IPO.

“The CMC and ISX may prefer smaller percentages (to be floated) at the beginning — we shall coordinate these issues with them,” said Makiya.

DUBAI, June 22 (Reuters) – Iraqi telecom company Asiacell is worried low local bourse liquidity could stop it from raising enough money in a mandatory initial public offering and is waiting for clarification on its licenses terms.

Asiacell’s license calls for the carrier — a Qatar Telecom (Qtel) affiliate — to launch an IPO to sell a quarter of its shares by the end of August and then list on the Iraq Stock Exchange (ISX).

“The timing of an IPO may depend on clarifications on how to implement the requirements of the license, the stock market rules and Iraqi company law,” a company spokesman said on Wednesday when asked if the company wanted to delay the IPO.

The ISX started operations in 2004 and has a market capitalisation of less than $4 billion, while daily turnover averaged just $1.6 million in May. The market’s small size may stop AsiaCell from raising the funds that would justify an IPO.

“This is a concern of Asiacell’s shareholders,” the spokesman said. But he declined to rule out selling a smaller percentage of the firm’s shares.

“Asiacell has expressed its concerns regarding the capacity of the Iraqi stock market to absorb IPOs of one or more telecom operators at the levels called for under the license,” he said.

Iraq’s mobile phone market has boomed since the 2003 U.S.-led invasion. Asiacell had a 39 percent share of the market and 8.1 million subscribers by the end of 2010, generating 5.1 billion riyals ($1.4 billion) in revenue last year.

DUBAI, June 22 (Reuters) – Index compiler MSCI’s move to extend a review on whether to upgrade the UAE to emerging status shows the oil exporter’s progress in developing its capital markets, the chief executive of Nasdaq Dubai bourse said.

MSCI has extended the review period for both the UAE and Qatar to December. It cited the May introduction of Deliver versus Payment (DvP) settlement systems as a key reason for this delay, which will give market participants more time to give their feedback. [ID:nN1E75K1W1]

“The UAE markets are evolving in the right direction,” said Jeff Singer, chief executive of Nasdaq Dubai, one of three bourses in the UAE.

“MSCI’s decision to extend the review period is recognition of the progress the UAE has made. The extension gives exchanges and regulators another bite at the apple. Further evolution is required to create an ideal capital market environment.

“I’m encouraged the UAE has made an upgrade to emerging market status a priority.”

The extra requirements include increasing foreign ownership limits, the introduction of stock borrowing and lending and short selling, plus a deeper derivatives market, Singer added. (Editing by Dinesh Nair)

DUBAI, June 16 (Reuters) – Axiom Telecom has sold a 35 percent stake to Qatar’s Mannai Corp for an undisclosed amount after deciding against a London share listing, the Dubai-based mobile phone retailer said on Thursday.

The sale follows Axiom’s aborted initial public offering (IPO) last year, when it planned to list on the Nasdaq Dubai exchange by selling up to one-third of its shares. Axiom cited “market conditions and liquidity” concerns, with offers not matching its $1 billion valuation.

Axiom said the Mannai deal was done at a higher valuation, without offering further details on pricing.

“We have covered all our financial requirements through this deal, but maybe there will be other opportunities to look at later on,” Axiom chief executive Faisal al-Bannai told Reuters.

Some shareholders sold shares holdings on a pro rata basis and the company also issued new shares to raise cash.

“Some money will go to the company and some to the shareholders,” said Bannai.

Once completed, Bannai’s associate companies will own 39 percent of Axiom’ shares, with the remaining 26 percent held by a unit of Dubai Holding, itself owned by Dubai’s ruler.

DUBAI (Reuters) – Qatar Telecom QTEL.QA (Qtel) will close its Virgin Mobile Services following an order from the country’s regulator, a decision which marks a victory for its rival operator Vodafone Qatar VFQS.QA.

Vodafone Qatar had long argued Qtel’s launch of Virgin-branded pre-paid services constituted a third service provider in Qatar and so violated the terms of Vodafone’s licence.

“Vodafone Qatar welcomes the news of ictQATAR’s decision,” said a Vodafone Qatar spokeswoman.

ictQATAR “has instructed Qtel to close all Qtel Virgin Mobile-branded services in Qatar,” the regulator, also known as The Supreme Council of Information and Communication Technology, said in a statement.

In a separate statement, Qtel said it would comply with the ruling and will transfer its existing Virgin Mobile customers to Qtel-branded services. These customers will retain their existing balances and phone numbers, but will require a new Qtel SIM card. Virgin accounts must be deactivated by August 4.

Shares of Vodafone Qatar rose 4 percent on the Qatar bourse. Qtel shares gained 1.4 percent.

Distributors and agents returning unused recharge cards will receive refunds, as will customers who do not to switch to Qtel.