(MENAFN- Gulf Times) Saudi Telecom Co (STC), the Gulf's No 1 telecom operator by market value, reported a 4.7% rise in first-quarter profit yesterday 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 2.50bn riyals ($667mn) in the three months to March 31, up from 2.39bn 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 2.32bn riyals.
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 12.47bn riyals, up 15.7%.
Profit grew slower than revenue as operating expenses rose by 17.5%, or 619mn riyals, as the company upped its marketing budget, general costs grew and amortisation and depreciation costs also rose.
STC did not state a total amount for its expenses, but revealed miscellaneous costs also rose 612mn riyals year-on-year. This included an extra 395mn in wages after a royal decision to grant government employees a bonus of two months' salary earlier this year. STC is majority state-owned. The company said its number of domestic mobile and fixed fibre broadband subscribers increased by 8% and 21% respectively, but did not provide more details.
STC's board has approved paying a first-quarter dividend of 1 riyals per share, it said separately, compared with 0.75 riyals a year before, according to Reuters data.
Sipchem
Saudi International Petrochemical Co (Sipchem) reported a 17.3% increase in first-quarter profit yesterday, missing analysts' estimates.
Sipchem made a profit of 80.6mn riyals ($21.5mn) in the three months to March 31, according to a bourse filing. This compares with a profit of 68.7mn riyals in the prior-year period. Five analysts polled by Reuters on average forecast Sipchem would make a quarterly profit of 98.3mn riyals.
Sipchem attributed the increase in quarterly profit to higher production and sales and lower expenses.
It added pressure on earnings from a decline in euro was partly offset by increased efficiency in plant operations, having had a number of plants offline during the opening quarter of 2014 for unplanned maintenance.
Union National Bank
Union National Bank, 50% owned by the Abu Dhabi government, posted a 20% rise in first-quarter net profit yesterday, beating analysts' forecasts.
The fifth largest lender on the Abu Dhabi exchange by assets reported a net profit attributable to equity holders of 610.8mn dirhams ($166.29mn) in the three months to March 31, up from 509.1mn dirhams a year earlier, a bourse filing said.
UNB had loans and advances worth 66.94bn dirhams at March-end, up from 64.07bn dirhams a year ago.
Customer deposits were 69.68bn dirhams as of March 31. This compares with 67.44bn dirhams 12 months earlier.
Tasnee
Saudi Arabia's National Industrialisation Co (Tasnee) said yesterday it would cut costs and revise foreign exchange and derivatives contracts at a subsidiary after swinging to a first-quarter loss.
The diversified industrial firm has interests in petrochemicals, metals and chemicals and is one of the world's largest producers of titanium dioxide through its Cristal subsidiary, in which it increased its stake at the end of last year.
However, like many petrochemical firms in the kingdom, Tasnee's earnings have suffered as product prices are closely tied to oil prices, which have slumped since mid-2014. Saudi producers also benefit from subsidised energy and feedstock costs, so lower crude prices compress their margins.
For the first quarter of 2015, Tasnee posted a net loss of 332.5mn riyals ($88.7mn) versus a profit of 320.8mn riyals in the same period a year ago, according to a bourse filing.
Also dragging Tasnee's results were higher expenses from foreign exchange hedging and derivatives contracts transacted by a subsidiary, the firm said in the bourse filing without providing any details.
Bank Audi
Lebanon's Bank Audi said its first-quarter net profit rose 17% to $100mn, year-on-year.
It said its net profit was boosted by the allocation of $33mn of net loan loss provision charges.
The bank, which operates in 13 countries, said its consolidated assets were $41.5bn by the end of March and its customer deposits stood at $35.1bn.
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