Saudi Telecom Q1 net falls due to handout
Riyadh, April 20, 2011
State-owned Saudi Telecom (STC) reported a 11 percent fall in first-quarter net profit due to bonus salaries ordered by King Abdullah, missing analysts' average estimates.
The firm made a net profit of 1.573 billion riyals in ($419.5 million) the three months to March 31, compared to 1.772 billion in the year-earlier period, according to a bourse statement on Tuesday.
Analysts surveyed by Reuters had expected Saudi Telecom to make an average of 2.04 billion riyals in net profit. STC blamed the profit fall on extra salary costs of 375 million riyals under handouts ordered by the king since his return from sick leave abroad in February.
"Without this cost ... there would have been a 10 percent rise of profit compared to the same quarter last year," STC said.
King Abdullah has given handouts worth around $130 billion for citizens, among them two extra salaries for state employees.
Revenues rose by 4 percent to 13.07 billion riyals in the quarter, it said, citing a rising number of clients and market share.
Earnings per share fell to 0.79 riyals from 0.89 riyals in the same quarter a year ago. - Reuters