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Mon 21 Jul 2014 06:14 PM

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Saudi's Mobily posts 18.6% slump in Q2 net profit

Gulf kingdom's No 2 telecom operator records profit drop after scrapping network sharing deal with Atheeb Telecom

Saudi's Mobily posts 18.6% slump in Q2 net profit

Etihad Etisalat (Mobily), Saudi Arabia's No.2 telecom operator, matched forecasts with a 18.6 percent fall in second-quarter net profit on Monday after it scrapped a network sharing deal with Atheeb Telecom.

Mobily, an affiliate of the United Arab Emirates' Etisalat , made a first-quarter net profit of SR1.31 billion ($349.3 million), down from SR1.61 billion in the prior-year period.

Analysts polled by Reuters on average forecast Mobily would make a quarterly profit of SR1.33 billion.

In June, Mobily warned its second-quarter profit would be cut by SR338.7 million following the dissolution of a network sharing deal with fixed-line operator Atheeb. Mobily in May scrapped plans to buy into Atheeb following months of negotiations.

Mobily's revenue for the three months to June 30 was SR5.99 billion, according to Reuters calculations, flat to the same period of last year. Mobily didn't provide a quarterly breakdown in its bourse filing.

For the first half of the year, data revenue contributed 39 percent of the operator's total revenue, up from 27 percent in the same six months of last year.

Mobily's board proposed paying a cash dividend of 1.25 riyals per share for the second quarter, the statement added. This is marginally higher than the 1.2 riyals the firm paid for the corresponding three months of 2013, according to Thomson Reuters data.

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