Saudi Telecom Posts 32.6% Q4 Net Profit Slump, Raises Dividend
Now Reading
Saudi Telecom Posts 32.6% Q4 Net Profit Slump, Raises Dividend

Saudi Telecom Posts 32.6% Q4 Net Profit Slump, Raises Dividend

The firm made a net profit of SAR2.44 billion ($649.8 million) in the last quarter of 2014.

Avatar

Saudi Telecom Co’s (STC) fourth-quarter profit slumped 32.6 per cent as gains on a property deal with the government failed to make up for higher expenses and losses on investments.

The Gulf’s No.1 telecom operator by market value made a net profit of SAR2.44 billion ($649.8 million) in the three months to Dec. 31, down from SAR3.62 billion in the prior-year period.

It missed analysts’ forecasts for net profit of SAR3.32 billion.

STC, which own stakes in operators in the Gulf, Turkey, South Africa and Asia, said a 19 per cent year-on-year rise in expenses was behind the fall.

This included a SAR399 million one-time impairment on its 35 percent stake in Dubai-based operator Oger Telecom, which owns a 55 per cent stake in Turk Telekom.

It also booked a separate SAR164 million loss because of an accounting method change for its investment in India’s Aircel Group. The Aircel accounting change was behind a nine-fold year-on-year profit growth recorded in the same quarter of 2013.

These losses, plus other expenses, wiped out gains worth SAR595 million booked as compensation for expropriated land and buildings in an upmarket area of Riyadh.

In December, the former monopoly said it would book a SAR621 million gain on the expropriation but that the investment had not been fairly valued and it would appeal.

Quarterly revenue was also 5.2 per cent up year on year at SAR11.85 billion.

Despite the profit fall, the company said it would hike dividends to SAR1 per share for the final three months of 2014. That compares with SAR0.75 for the corresponding period of 2013, according to Thomson Reuters data.

Group Chairman Abdulaziz al-Sugair repeated that the company was evaluating options over its international portfolio, without giving specifics.

The firm has been focusing on its domestic business under Sugair, who took over in June 2012. It sold its Indonesian subsidiary AXIS in September 2013.


© 2021 MOTIVATE MEDIA GROUP. ALL RIGHTS RESERVED.

Scroll To Top