STC reports 2.1% profit increase in Q1 of 2018
Saudi Telecom Company (STC) has reported a net income increase of 2.1% quarter-on-quarter, for the first three months of 2018.
According to the filing made with the Saudi Stock Exchange (Tadawul) the income increase can be attributed to a few factors. Firstly there was a decrease of SR 211 million ($56.2 million) as well as a decrease of SR 138 million ($36.7 million), which resulted in an increase of SR 73 million ($19.4 million) in gross profit.
Commenting on the results Nasser Alnasser, STC’s acting CEO, said that the increase in net income by 2.1% for the 1st quarter of 2018 compared with the 1st quarter 2017 was a result of the continued program to improve operational efficiency and cost optimisation initiatives.
Another factor was the SR 55 million ($14.6 million) increase in operating expenses caused by depreciation and amortization of around SR 76 million ($20.2 million). This however was offset by a slight decrease in sales and marketing expenses.
The company made additional savings due to a decrease in staff early retirement costs, bringing STC’s up to SR 224 million ($59.7 million) compared to SR 154 million ($41 million).
In his comments to Tadawul Alnasser noted that the overall telecom market landscape particularly with respect to consumer business segment remains challenging amid economic and regulatory changes that are taking place.
To combat this Alnasser said that STC has developed a new strategy, called DARE that focuses on four key areas: Digitising STC, accelerating the performance of core assets, reinventing customer experience and expand scale and scope.
Revenue from services in Q1 of 2018 decreased by 1.1% to SR 12,386 million ($3.3 billion). Total Shareholder Equity for the quarter was up by 0.9% to SR 63,468 million ($1.7 billion), as was comprehensive by 1.1% to SR 2,540 million ($677 million).
Alnasser finished in saying that, STC has signed an agreement with the General Sport Authority, the Saudi Arabian Football Federation. Under which STC the right to obtain the exclusive broadcast rights for the local competitions, including: the Saudi Professional League, the King Cup, the Crown Prince Cup, professional league matches and all the Saudi national team matches.