Saudi Telecom Net Profit q2 2011

Indonesia stock info - Saudi Telecom Net Profit q2 2011 ; Saudi Telecom Co. (7010.SA), the largest listed telecom operator in the Middle East, Monday said its second-quarter net profit rose 9% on year to 2.06 billion Saudi riyals ($549.9 million) due to its growing broadband customer base.

Bahrain-based SICO expected STC to post a second-quarter net profit of SAR2.1 billion, while analysts at Riyadh-based NCB Capital had penciled in SAR1.88 billion.

"This continuous increase in the group's revenue is mainly attributed to strong growth within domestic operations revenue as a result of increased broadband customers (fixed and mobile)," Saud Al Daweesh, STC's chief executive, said in a statement posted on the Saudi bourse website.

First-half earnings per share were unchanged at SAR1.92, while second-quarter operating profit amounted to SAR2.78 billion compared with SAR2.35 billion a year ago.

In a separate statement, STC, which saw its revenue from services for the second quarter rise 10% to SAR13.88 billion, said its board of directors agreed to pay SAR1 billion dividend for the second quarter of the year, or SAR0.50 a share. The dividend represents 5% of the par value of the share.

Saudi Telecom, which had a domestic monopoly until 2005 and is mainly owned by Saudi public-sector corporations, is under intense pressure to improve profitability as a regional telecom war heats up, with rivals like Kuwait's Zain (ZAIN.KW), and the U.A.E.'s Emirates Telecommunications Corp. (ETISALAT.AD) also competing within Saudi Arabia.

But it was able to continue growing in its domestic market and upgraded its HSPA+ network. Its mobile subscriber base increased 8% from a year earlier and the number of its broadband internet users hit more than 11 million at the end of June.

In May, the firm's Indonesian subsidiary NTS, better known as Axis, signed a $1.2 billion, seven-and-a-half year, shariah-compliant financing deal for equipment purchases. Saudi Telecom said the financing, which has been backed by export credit agencies, would help fund Axis expand over the next five years, particularly into mobile broadband and improved coverage in Indonesia with the aim of improving financial returns for the group.

Saudi Telecom, which plans to spend over $1 billion this year on infrastructure across its global operations, is also bidding on Syria's third mobile license, despite the auction being postponed in April due to political ructions in Syria.


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