Saudi Telecom reports 6.7% rise in Q2 profit
Saudi Telecom Co (STC), the Gulf's No.1 telecoms operator, reported a 6.7 percent rise in second-quarter profit on Wednesday, beating analysts' estimates.
It attributed the profit growth to an increase in its domestic broadband, business services and wholesales services sales, as well as higher revenue from international operations.
The former monopoly made a net profit of SR2.41bn ($642.7m) in the three months to June 30, up from SR2.26bn in the year-earlier period, it said in a bourse statement.
The telco said in a separate statement it would pay a dividend of 0.5 riyals a share for the second quarter.
Soaring demand for broadband has lifted STC's earnings in recent quarters, with the state-run firm offering bundle packages to woo back customers from rival operators Etihad Etisalat (Mobily), an affiliate of the United Arab Emirates' Etisalat, and Zain Saudi, part-owned by Kuwait's Zain.
STC, which remains majority government-owned nearly a decade after its partial privatisation, is the largest Gulf telecoms operator by market value with operations across the Muslim world from Turkey to Indonesia.
Morgan Stanley in June upgraded STC's stock to overweight and raised its price target to 48 riyals from 39 riyals, saying earnings and dividends were likely to increase.