* Q4 net profit 1.45 bln dirhams vs 854 mln a year ago
* Maroc Telecom purchase from Vivendi seen by end-May
* Full year profit 7.08 bln dirhams vs 6.74 bln in 2012
* Proposes dividend of 0.35 dirhams for second half 2014
(Adds Maroc Telecom purchase plans, CFO quotes, details)
By Matt Smith
DUBAI, March 4 Etisalat, the United
Arab Emirates' biggest telecoms operator by revenue and
subscribers, missed analysts' forecasts with a 70 percent rise
in fourth-quarter net profit on Tuesday after it took
impairments on Nigerian and Indonesian operations.
The company also said it expected to complete a 3.9-billion
euro purchase of Paris-listed Vivendi's 53 percent
stake in Maroc Telecom, plus 300 million euros in 2012
dividends from the Moroccan firm, by end-May.
Etisalat, a former monopoly operating in about 15 countries
across the Middle East, Africa and Asia, made a net profit of
1.45 billion dirhams ($394.77 million) in the three months to
Dec. 31, according to Reuters calculations.
Analysts polled by Reuters gave a consensus forecast of
fourth-quarter profit of 2.17 billion dirhams.
Of the 1.37 billion dirhams in impairment charges, 516
million dirhams related to loans to affiliate Etisalat Nigeria,
in which it holds a 40 percent stake, with 506 million dirhams
relating to its 4.2 percent stake in Indonesia's PT XL Axiata
, Etisalat CFO Serkan Okandan said.
The Indonesian Rupiah fell 26 percent against the dollar
last year. The UAE dirham is pegged to the dollar.
Etisalat's foreign operations accounted for 33 percent of
Etisalat's revenue in 2013, up from 28 percent a year earlier
after unit Pakistan Telecommunications Co (PTCL) was
included. The UAE firm treated PTCL as a subsidiary from 2013.
"Since international subsidiaries are growing faster than
the UAE, we're expecting that to improve by a few (percentage)
points," said Okandan.
MAROC TELECOM DEAL BY END-MAY
As part of that overseas expansion, Okandan told Reuters
that the Maroc Telecom deal, agreed in November, should go
through before the end of May, as long as regulatory approval
from the countries where the firm operates was forthcoming.
Former monopoly Maroc Telecom, whose annual profit fell 17
percent to 5.54 billion Moroccan dirhams last year, also has
operations in Gabon, Mauritania, Burkina Faso and Mali.
That approval was likely to be a formality in most places,
telecom analysts said, although Gabon may be more complicated
because Etisalat owns Gabon operator Moov.
Vivendi's chief financial officer, Herve Philippe, said last
month that the sale of the controlling stake should go through
in the coming weeks.
Okandan said Morocco's takeover rules require Etisalat to
make a buyout offer for Maroc Telecom's minority shareholders,
but declined to provide further details.
Rising foreign revenue came despite a 6.6 percent decline in
earnings from Egypt.
This was due to the falling value of the Egyptian pound,
Okandan said, adding that in local currency terms its Egyptian
revenue actually rose about 6 percent.
Etisalat's 2013 full-year net profit rose to 7.08 billion
dirhams from 6.74 billion dirhams a year earlier, according to a
statement to Abu Dhabi's bourse.
The company had 148 million subscribers at the end of 2013,
an increase of 9 million from a year earlier, Okandan said.
Annual revenue rose 18 percent to 38.9 billion dirhams.
Operating expenses climbed 26 percent to 24.7 billion dirhams,
which Okandan said was largely due to higher handset sales.
Handsets offer little profit margin, but Gulf operators are
increasingly using smart phone sales to sign up customers to
monthly contracts. People on such contracts usually spend more
on telecom services and are less likely to switch providers.
Etisalat spent 6.3 billion dirhams last year on new licences
and improving and expanding its networks, Okandan added.
The company proposed a cash dividend of 0.35 dirhams per
share for the second half of 2014.
($1 = 3.6730 UAE dirhams)
(Editing by Mike Collett-White)