| Element | Current quarter | Similar quarter for previous year | % Change current | Previous quarter | % Change previous |
|---|---|---|---|---|---|
| Net profit (loss) |
2,148
|
2,322
|
-
|
1,865
|
15.17
|
| Gross profit (loss) |
7,067
|
7,624
|
-
|
7,360
|
-
|
| Operational profit (loss) |
2,361
|
3,038
|
-
|
2,597
|
-
|
| All figures are in (Millions) Saudi Arabia, Riyals | |||||
| Element | Current period | Similar period for previous year | % Change |
|---|---|---|---|
| Net profit (loss) |
6,388
|
7,384
|
- |
| Gross profit (loss) |
21,649
|
22,332
|
- |
| Operational profit (loss) |
7,962
|
9,381
|
- |
| Earning or loss per share, Riyals |
3.19
|
3.69
|
- |
| All figures are in (Millions) Saudi Arabia, Riyals | |||
| Element | EXPLAINATION |
|---|---|
| Reasons of increase (decrease) for quarter compared with same quarter last year | The net profit for the 3rd quarter decreased by SR 174m compared to the comparable quarter in the previous year, mainly due to the following: 1- The SR 1,160m increase in cost of services, and the SR 120m increase in operating expenses during the 3rd quarter compared to the comparable quarter in the previous year, as a result to the SR 603m increase in revenue during the quarter compared to the comparable quarter last year, which resulted in the SR 677m decline in Operating Profit compared to the comparable quarter last year 2- The booking of SR 42m for (Other income and expenses, net) during the 3rd quarter compared to SR (431m) for the comparable quarter last year, mainly due to the following: a- The SR 105m decrease in early retirement program cost during the 3rd quarter compared to the same period last year b- The SR 192m decrease in (Losses from investments accounted for under equity method) during the 3rd quarter compared to the same quarter last year c- The SR 45m decrease in cost of finance during the 3rd quarter compared to the same quarter last year d- The SR 44m increase in commissions during the 3rd quarter compared to the same quarter last year e- The SR 86m decrease in (Other income and expenses; other, net) compared to the same quarter last year 3- The SR 37m increase in the provision for Zakat & Tax during the 3rd quarter compared to the same quarter last year |
| Reasons of increase (decrease) for period compared with same period last year | The net profit for the 9 months period decreased by SR 996m compared to the same period last year, mainly due to the following: 1- The SR 2,926m increase in cost of services, and the SR 736m increase in operating expenses during the 9 months period compared to the same period last year, as a result to the SR 2,243m increase in revenue during the 9 months period compared to the comparable period last year, which resulted in the SR 1,419m decline in Operating Profit compared to the comparable period last year 2- The SR 219m decrease in (Other income and expenses, net) during the 9 months period compared to the same period last year, mainly due to the following: a- The SR 21m decrease in the early retirement program cost during the 9 months period compared to the same period last year b- The SR 80m decrease in (Losses from investments accounted for under equity method) during the 9 months period compared to the same period last year c- The SR 21m decrease in cost of finance during the 3rd quarter compared to the same period last year d- The SR 231m increase in commissions compared to the same period last year e- The SR 134m increase in (Other income and expenses; other, net) compared to the same period last year, and the main reason is attributed to the following: 1- The SR 174m decrease in Miscellaneous revenue compared to the same period last year 2- The SR 162m decrease in (losses on sale/disposal of property, plant and equipment) during the 9 months period compared to the same period last year 3- The SR 122m increase in Miscellaneous expenses during the 9 months period compared to the same period last year, which includes an amount of SR 395m two-month salary expenses (one-off) booked during the 1st quarter of 2015, which was made as a gesture to follow the initiative of the Honorable Royal Decree (as previously announced) 3- The SR 36m increase in the provision for Zakat & Tax during 9 months period compared to the same period last year 4- The SR 241m decrease in Non-controlling interest share compared to the same period last year |
| Reasons of increase (decrease) for quarter compared with previous quarter | The net profit for the 3rd quarter increased by SR 282m compared to the immediate prior quarter, mainly due to the following: 1- The SR 215m increase in cost of services, and despite the SR 57m decrease in operating expenses, operating Profit decreased SR 236m during the 3rd quarter compared to the immediate prior quarter 2- The booking of SR 42m compared to SR (537m) for the immediate prior quarter, mainly due to the following: a- The SR 105m decrease in the early retirement program cost during the 3rd quarter compared to the immediate prior quarter b- The SR 253m decrease in (Losses from investments accounted for under equity method) during the 3rd quarter compared to the immediate prior quarter c- The SR 226m decrease in (Other income and expenses; other, net) compared to the immediate prior quarter 3- The SR 58m increase in the provision for Zakat & Tax during the 3rd quarter compared to the immediate prior quarter |
| Reclassifications in quarterly financial results | Certain comparatives figures for the period ending at 30 September 2015 have been reclassified to conform with the presentation used for the period ending at 30 September 2016. |
| Other notes | Revenue from services for the 9 months period amounted to SR 39,833m compared to SR 37,590m for the corresponding period last year, an increase of 6 %, and for the 3rd quarter revenue from services reached 13,498m compared to SR 12,895m with an increase of 5% compared to same period last year. Earnings before interest, taxes, zakat, depreciation and amortization (EBITDA) for the 3rd Quarter amounted to SR 4,346m compared to SR 4,958m for the corresponding period last year, a decrease of 12%, and for the period, EBITDA amounted to SR 13,954m compared to SR 14,911m for the corresponding period last year, a decrease of 6%. Total shareholder equity (excluding non-controlling interest) as 30 September 2016, SR 59,480m compared to SR 60,355m as of 30 September 2015 decreased by 1.5% Commenting on the results, STC Group CEO, Dr. Khaled H. Biyari, stated: The 6% increase in Consolidated revenue compared to the same period last year, came as a result to the growth in all sectors revenues, and an increased contribution from enterprise services, specially the recently introduced services which includes cloud computing and managed data services as a result to STC investments in this sector, these investments started to contribute to the top line and will have a bigger positive outcomes in the near future. I also assure, that STC will continue to invest in infrastructure, advanced networks and new technologies which will enable us to reach new levels of customers satisfaction and enrich our customers experience. With regards to the increase in cost of services during the period, it should be noted that it includes costs resulting from the bio-metric process, registering all mobile customers (postpaid and prepaid) and bind their fingerprint with the related Government agencies, as this process consumed time and effort from the company and significant costs which was booked during the period. In light of the recent major development with regards to NTP 2020 and KSA Vision 2030, STC as an efficient ICT provider at a world-class standard is at the forefront of the Digital Transformation of the Saudi economy, due to the company strength and durability in infrastructure tailored to the latest technology. To achieve this in conjunction with the KSA Vision 2030 and the NTP, the company has significant investments in integrated structure of cloud computing services and an integrated platform system for (Internet of things) with great emphasis on investment in human resources and this will provide national solutions based on best practices in these sectors, to offer new smart services to customers from various government and business sectors, and individuals to enable the knowledge economy and the information society. With regards to international operations, the 9 months period witnessed revenue growth of 2% in the controlled international subsidiaries compared to same period last year, and this is attributed mainly to the continued growth in controlled subsidiaries customer base and market shares. Domestically, the 9 months period witnessed revenue growth of 5% from domestic operations compared to same period last year, as a result to the growth in all sectors revenues, and an increased contribution from the enterprise sector. STC continues with the deployment of the fiber optic network for both business and Consumer sectors. During the 3rd quarter, FTTH Customer base increased 33% compared to the same period last year, and 4% compared to the immediate previous quarter. Fixed Broad Customer base increased 3.4% compared to the same period last year. STC continued during the 3rd quarter with the revamp the fixed line services through the new wave of services with the accompanying services which resulted in 5% increase in Bundled services customer base compared to the same period last year. Enterprise business unit overall revenues increased approximately 20% during the 3rd quarter compared to the same period last year, driven mainly by the 28% and 21% increase in Business sector data services revenues and Enterprise mobile services revenue accordingly compared to same period last year. |
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