Saudi Mobily sees 40pc jump in market share
Riyadh, May 24, 2008
Etihad Etisalat (Mobily), Saudi Arabia's second-largest mobile phone operator, said on Saturday it expects its market share to rise above 40 per cent in 2008 despite the arrival of a third operator.
The company had 11.1 million customers at the end of 2007, giving it a market share of 39 per cent, chief executive officer Khaled Al Kaf told reporters.
'We expect this market share to exceed 40 per cent in 2008,' he said. Mobily, which started operations in May 2005, competes with incumbent Saudi Telecom Company, the largest Arab telecom firm by market value, for mobile phone users in the kingdom, the world's largest oil exporter and home to 25 million people.
Zain Saudi Arabia, an affiliate of Kuwait's Mobile Telecommunications Company (Zain), plans to start operations next month after selling shares to the public in the first quarter.
Mobily plans to focus on developing the post-paid customer base, Kaf said. 'About 25 per cent of our 2007 revenues was from post-paid clients and the remainder from pre-paid clients,' he said.
Mobily also expects the first net income from Bayanat al-Oula by the end of next year, he told Reuters on the sidelines of the news conference marking the start of Mobily's fourth year of operations.
Mobily agreed in September to buy 99.9 per cent of the data provider company for SR1.5 billion ($400 million). 'Bayanat will start operating a WiMax wireless Internet network this year,' he said.
A 40 per cent increase of Mobily's capital will be completed within two months, Kaf said. Chairman Abdulaziz Al-Sughayir told shareholders in March that the capital hike would be completed in May.
Mobily made a first-quarter net profit of 326 million riyals, a 30 per cent rise from the year-earlier period, still the smallest gain in quarterly profit since the firm started operations.
Mobile phone penetration in the largest Arab economy probably exceeds 100 per cent. Saudi mobile phone operators may be generating SR55 billion in revenue in 2010, 38 per cent more than 2006, the kingdom's telecom ministry Mohammed bin Jamil al-Mullah said last year.
Mobily's stock has fallen almost 24 per cent this year, underperforming the index, which is down about 13 percent. Emirates Telecommunications Corporation (Etisalat) owns 26.25 per cent in Mobily, having sold an 8.74 per cent stake in the firm at 55 riyals per share this year.-Reuters