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Saudi Telecom Group (stc) reported SAR c. 3.3 bn in net income in 1Q 2024, up 5.7% y-o-y, while revenues rose 5.1% y-o-y to SAR 19.1 bn, according to its earnings release (pdf).
Growth drivers: The telecom giant credited its bottom line growth to a 1.2% uptick in revenue from its Saudi operations driven by booking more business across its commercial, carrier and wholesale unit, as well as growth in the mobility and residential segments. Revenues from subsidiaries also grew 13% y-o-y in the same quarter with Channels by stc, Solutions by stc, and STC Kuwait leading the charge in terms of revenue size, according to a disclosure to Tadawul.
Other key financial metrics: The group also increased its capex by 36% y-o-y to c. SAR 1.7 bn in 1Q. The hike in capex explains, in part, its free cashflow turning to net outflows of SAR 260 mn in 1Q 2024, compared to SAR 2 bn in net inflows in the same quarter last year. Meanwhile, the company’s total debt more than doubled on an annual basis to SAR 22 bn in the same quarter.
Subscriber growth in KSA + Bahrain: Fixed broadband and telephone subscribers grew 2.2% y-o-y to 5.6 mn in 1Q 2024, while mobile subscribers grew 10.4% y-o-y to 27 mn at stc KSA, and stc Bahrain saw a 12.8% y-o-y increase in mobile subscribers to 900k in the same quarter.
REMEMBER- Stc + PIF to create region’s largest telecom infrastructure company: The related parties are working together to consolidate stc-owned Telecoms Towers Company, better known as Tawal, and Golden Lattice Investment (Glic) under a new entity that is expected to own and manage a portfolio of around 30k towers across five countries. The new entity will have annual revenues in the USD 1.3 bn range, the PIF statement reads.
The latest of its competition in Spain: “The [Spanish] government aims to buy as much as 10% of Telefonica’s shares as soon as possible, which would leave it a step ahead of the Saudi state-backed telecom’s plan to take a 9.9% stake.”
Double kudos: stc clinched the top spot as the most valuable telecoms brand in the Middle East after a 12% increase in brand value to USD 13.9 bn. It ranked as the region’s second strongest brand in the region with a brand strength index score of 88.1/100. It has clinched the top spot as Saudi’s best workplace in LinkedIn’s 2024 Top Companies. It unseated Aramco as Saudi’s top workplace this year, ending the oil giant’s three-year streak at the top of the list.
