Saudi telecom provider Mobily decreased its quarterly losses in Q1 2018 by 49 percent to SR93 million ($24.84 million) compared with SR182 million in Q4 2017. This was mainly due to a growth of revenues driven by a better mix of products mainly from data, the increase of efficiency in managing operational expenses, the impact of implementing IFRS 9 and 15, and the reversal of certain provisions that are no longer required, according to the company.
Revenues improved for the second consecutive quarter reaching SR2,833 million in Q1 2018 compared with SR2,827 million in Q4 2017, a slight increase of 0.2 percent, despite the following:
l The impact on sales at the beginning of the year due to the implementation of the value-added tax (VAT).
l The reduction in interconnection rates by 45 percent.
l The seasonality of handset sales, and its increase in Q4 2017.
l The seasonal decrease related to the number of days in Q1.
Without the decrease of the interconnection rates, revenues would have grown by 2 percent.
Mobily’s gross profit increased in Q1 2018 by 6.6 percent to SR1,663 million compared with SR1,560 million in Q4 2017. This increase is mainly due to the reduction in interconnection rates during Q1 2018 compared with those of Q4 2017 and the reduction in equipment costs in Q1 2018 compared with Q4 2017.
Mobily managed to grow its revenues for the second consecutive quarter. Q1 2018 revenues slightly decreased by one percent (SR33 million) to SR2,833 million compared with SR2,865 million in Q1 2017. Mobily achieved a stable level in revenues despite the general economic and regulatory changes, including the impact on sales in the beginning of the year due to the implementation of VAT, and the reduction in interconnection rates by 45 percent.
Without the decrease of the interconnection rates, the revenues would have grown by one percent year over year.
The gross profit stabilized at SR1,663 million in Q1 2018 compared to SR1,665 million in Q1 2017 with a slight decrease by 0.12 percent, despite the slight decrease in revenues.