By: Thabet Shehata

Riyadh – Mubasher: Profits of three of the four telecommunications companies listed on the Saudi Stock Exchange (Tadawul) totalled SAR 2.2 billion ($585.41 million) in the second quarter of 2017, up 17% from SAR 1.88 billion ($500.6 million) in the year-ago period.

Net profits for the first six months of 2017 for the three companies, whose fiscal years end in December, reached a combined SAR 4.6 billion, registering a growth of 13.86% from SAR 4.04 billion in H1-16, according to statistics by Mubasher.

The Saudi telecom sector comprises four companies, namely: Etihad Etisalat “Mobily”, Saudi Telecom Company (STC), Mobile Telecommunications Company Saudi Arabia (Zain KSA), and Etihad Atheeb “Go”. The fiscal years for the first three ends 31 December, while Go’s ends in March.

Riyad Capital recently projected a 49% year-on-year growth in total income for the Saudi telecom sector in Q2-17. It forecasted SAR 2.32 billion in net income from STC, Mobily and Zain, combined, compared to SAR 1.56 billion in the year-ago period.

Operating profits for the three companies declined by 2.8% to a combined SAR 2.83 billion in Q2-17 from SAR 2.9 billion, and by 2.47% to SAR 5.75 billion in H1-17 compared to SAR 5.89 billion in H1-16.

Mobily logged SAR 189.7 million losses in Q2-17 against profits of SAR 3.2 million in the year-ago period, which pressured the sector’s overall profits.

Following the announcement, Al Rajhi Capital downgraded its target price (TP) for Mobily’s stock to SAR 16.5 per share from SAR 18.

Meanwhile, Zain achieved SAR 8 million in profits in Q2-17 against losses of SAR 328 million in the same period of 2016.