STC expects to invest $1bn to expand its networks

Updated 01 September 2015
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STC expects to invest $1bn to expand its networks

DUBAI: Saudi Telecom Co. (STC) expects to spend another $1 billion in the second half of 2015 on enhancing its networks as it tries to meet surging demand for web-based services, its chief executive said on Tuesday.
The SR3.9 billion outlay repeats STC's capital expenditure in the first six months of 2015 and lifts this year’s spend to a four-year peak.
"STC is continuing to invest in both mobile and fixed (networks) and modernising our IT systems — we want to ensure our network is second to none," STC Chief Executive Khaled Al-Biyari told Reuters.
"The growth in data traffic we’re experiencing is unmatched ... which is putting stress on the network."
STC, the Gulf's largest telecom operator by market value, is the dominant force in the Kingdom's telecoms market. Rival operators Etihad Etisalat (Mobily) and Zain Saudi are both loss-making.
Al-Biyari, who became CEO in April, predicted services for corporate clients would be “the engine of growth” for STC because Saudi's consumer telecoms market is saturated. There are 1.8 mobile phone subscriptions per resident, one of the highest penetration levels globally.
STC, which own stakes in operators in the Gulf, Turkey, South Africa and Asia, has switched its focus to the domestic market in recent years, a decision that helped revive the company's fortunes. It sold an 80 percent stake in Indonesian operator PT Axis Telekom last year.
STC's annual profits slumped to a 10-year low in 2012 but hit a six-year peak in 2014. First-half net profits this year were down 2.5 percent at SR5.06 billion from a year earlier as costs rose.
Al-Biyari attributed higher costs to a bonus of two months' salary paid to state employees to mark Custodian of the Two Holy Mosques King Salman's accession to the throne in January. STC is 70 percent owned by the government.
Al-Biyari also confirmed that Oger Telecom, in which STC owns a 35 percent stake, was seeking to sell its majority holding in South African mobile operator Cell C.
"Optimizing the portfolio is something that’s at the top of my agenda," said Biyari. "We want to ensure our investment portfolio brings in value."
STC has no immediate plans to raise debt, Al-Biyari added.


US poised to end waivers for 5 countries importing Iranian oil

Updated 48 min 47 sec ago
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US poised to end waivers for 5 countries importing Iranian oil

  • Japan, South Korea, Turkey, China and India were exempted from sanctions until May 2
  • Since November, Italy, Greece and Taiwan have stopped importing oil from Iran

WASHINGTON: The Trump administration is poised to tell five nations, including allies Japan, South Korea and Turkey, that they will no longer be exempt from US sanctions if they continue to import oil from Iran, officials said Sunday.
Secretary of State Mike Pompeo plans to announce on Monday that the administration will not renew sanctions waivers for the five countries when they expire on May 2, three US officials said. The others are China and India.
It was not immediately clear if any of the five would be given additional time to wind down their purchases or if they would be subject to US sanctions on May 3 if they do not immediately halt imports of Iranian oil.
The officials were not authorized to discuss the matter publicly and spoke on condition of anonymity ahead of Pompeo’s announcement.
The decision not to extend the waivers, which was first reported by The Washington Post, was finalized on Friday by President Donald Trump, according to the officials. They said it is intended to further ramp up pressure on Iran by strangling the revenue it gets from oil exports.
The administration granted eight oil sanctions waivers when it re-imposed sanctions on Iran after Trump pulled the US out of the landmark 2015 nuclear deal. They were granted in part to give those countries more time to find alternate energy sources but also to prevent a shock to global oil markets from the sudden removal of Iranian crude.
US officials now say they do not expect any significant reduction in the supply of oil given production increases by other countries, including the US itself and Saudi Arabia.
Since November, three of the eight — Italy, Greece and Taiwan — have stopped importing oil from Iran. The other five, however, have not, and have lobbied for their waivers to be extended.
NATO ally Turkey has made perhaps the most public case for an extension, with senior officials telling their US counterparts that Iranian oil is critical to meeting their country’s energy needs. They have also made the case that as a neighbor of Iran, Turkey cannot be expected to completely close its economy to Iranian goods.