Saudi telco Mobily’s net profit skids 16.1% in first quarter
Recently, the telco received a fine of more than 17 million riyals from the Saudi telecoms regulator
Saudi telecoms company Etihad Etisalat (Mobily) reported a more than 16 per cent dip in net income in the first three months of 2019 compared with the previous quarter, to 67.3 million Saudi riyals (Dh65.9m) after zakat and tax.
However, revenues for the first quarter ending March 31 increased 13 per cent year-on-year - reaching 3.2 billion riyals - Mobily said in a statement on Sunday to the Saudi stock exchange Tadawul, where its shares are traded.
The company attributed the jump in revenues to its better mix of services and the growth in business unit and wholesale revenues.
UAE's biggest telecom operator Etisalat owns a 28 per cent stake in Mobily, which was founded in 2004. This month, it received a fine of more than 17m riyals from the Saudi telecom regulator in a round of crackdowns on market irregularities.
“Gross profit amounted to 1.8bn riyals [in the first quarter of 2019], a yearly increase of almost 10 per cent. This is mainly due to a healthier topline that absorbed the impact of the new government royalties mechanism and the implementation of IFRS16,” Mobily said in the statement.
Financial charges for the period also increased 12.8 per cent yearly, reaching 212m riyals, mainly due to the result of the implementation of the new financial and banking standards International Financial Reporting Standard 16.
Without IFRS 16 impact, the financial charges would have decreased 5 per cent, reflecting the company’s efforts in reducing net debt and the slight decrease in funding costs.
Updated: April 21, 2019 11:43 PM