Saudi Telecom Q1 net profit rises 4.7

(MENAFN- Arab News) JEDDAH: Saudi Telecom Co. (STC) the Gulf's No.1 telecom operator by market value reported a 4.7 percent rise in first-quarter profit that beat estimates but was smaller than an increase in revenue as costs grew.
The firm which competes domestically with Etihad Etisalat (Mobily) and Zain Saudi made a net profit of SR2.50 billion ($667 million) in the three months to March 31 up from 2.39 billion in the prior-year period.
Three analysts polled by Reuters had on average forecast STC which own stakes in operators in the Gulf Turkey South Africa and Asia would make a quarterly profit of SR2.32 billion.
STC had reported falling profits in the preceding two quarters stalling an improvement in its bottom line largely due to the company trimming its international ambitions.
First-quarter revenue was SR12.47 billion up 15.7 percent.
Profit grew slower than revenue as operating expenses rose by 17.5 percent or 619 million riyals as the company upped its marketing budget general costs grew and amortization and depreciation costs also rose.
STC did not state a total amount for its expenses but revealed miscellaneous costs also rose SR612 million year-on-year. This included an extra 395 million in wages after a royal decision to grant government employees a bonus of two months' salary earlier this year.
The company said its number of domestic mobile and fixed fiber broadband subscribers increased by 8 percent and 21 percent respectively but did not provide more details.
STC's board has approved paying a first-quarter dividend of SR1 per share it said separately compared with SR0.75 a year before according to Reuters data.