Mobily Touts Q4 Profit

Etihad Etisalat Co. (Mobily) , Saudi Arabia's alternative operator, has reported a 55.8 percent increase in fourth quarter profit as it continues to steal market share away from state-owned incumbent Saudi Telecom Co. (STC) .

Part-owned by United Arab Emirates-based carrier Etisalat , mobily beat analysts' expectations with a net income of 514 million Saudi Riyals (US$136.67 million), up from SAR330 million ($87.74 million) in the fourth quarter of 2006. The average forecast calculated by Reuters had profits rising by 23.8 percent.

Full-year net income jumped from SAR700 million ($186.12 million), or SAR2.76 per share, to SAR1.38 billion riyals ($366.93 million), or SAR1.4 per share, as sales rose 44.3 percent to SAR8.44 billion ($2.24 billion).

The operator credits an increase in sales outlets in rural areas for the growth, along with new services such as broadband, which accounted for 10 percent of its sales during the year. The operator signed a $2.88 billion financing agreement last year to fund its network expansion. (See Mideast Carriers Line Up Credit.)

Mobily claimed a 30 percent share of the Saudi mobile market at the end of 2006, 18 months after its launch. That has now climbed to 40 percent, the carrier says, without providing details of subscriber figures.

Competition from mobily has Saudi Telecom, which provides fixed-line and mobile services, out shopping for investments abroad as the loss of market share eats into its profits. (See Saudi Telecom Buys $2.6B Oger Stake.)

Mobily was the only gainer on the Saudi stock exchange Sunday, closing 1.12 percent higher after the results were released. It climbed another 3.32 percent on Monday to close at SAR70.

— Nicole Willing, Reporter, Light Reading

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