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Riyadh: Etihad Etisalat (Mobily), Saudi Arabia's second-largest mobile phone company by market value, reported a 47.4 per cent rise in second-quarter net profit, almost double the rise in earnings from operations.
Mobily, an affiliate of Emirates Telecommunications, said net profit was 448 million Saudi riyals ($119.5 million) for the three months to June 30, compared with 304 million riyals in the year-earlier period.
The earnings came close to the top range of analysts' forecasts for Mobily's second-quarter profit which ranged from 345 million riyals to 486.4 million riyals in a Reuters survey last month. Mobily said the rise in net profit was the result of mainly better mobile phone services and a rise in sales outlets.
Operating profit rose 24 per cent to 530 million riyals on the back of a 25 per cent rise in revenues.
"We continue to show solid growth in all operations, led mainly by the data business which we doubled, and post-paid revenues which rose at least 40 per cent in the 12 months to end-June, 2008," CEO Khalid Al Kaf told Reuters.
He said net profit growth outpaced that of operating profit after the company reduced its operating and financial costs. "We are improving the efficiency of our business," he said.
Emirates Telecommunications posted a 58 per cent jump in second-quarter profit on capital gain it made after it reduced its stake in Mobily to 26.25 per cent from 35 per cent.
The rise in Mobily's second-quarter net profit compared with a 30 per cent annual increase in the first-quarter which was both the smallest gain in quarterly profit since the firm started operations in 2005 and below all analysts' forecasts.
Mobily competes with Saudi Telecom, the second-largest Arab telecom firm by market value, for mobile phone users in the kingdom.
Zain Saudi Arabia, an affiliate of Kuwait's Mobile Telecommunications (Zain), plans to start operations this year after selling shares to the public in the first quarter.
Mobily, which did not release subscriber numbers, says it has a 39 per cent market share with 11.1 million subscribers.
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