Wataniya blames home woes, FX loss for profit drop
DUBAI, Oct 22 - Wataniya (NMTC.KW), Kuwait's No.2 telecom operator and majority- owned by Qatar Telecom QTEL.QA (Qtel), missed estimates with a 31 percent drop in quarterly profit, mainly because of a decline in domestic income and widening losses in Saudi Arabia.
The firm, in which Qtel recently raised its stake to 92.1 percent, made a net profit of 15.5 million dinars ($55.18 million) in the three months to September 30, down from 22.5 million dinars in the year-earlier period, according to a company statement.
Two analysts polled by Reuters forecast Wataniya would make a third-quarter net profit of between 20.68 million dinars and 21 million dinars.
Quarterly revenue was 191 million dinars. This compares with 188 million dinars a year ago.
In Kuwait, Wataniya competes with Zain (ZAIN.KW) and Viva, an affiliate of Saudi Telecom Co 7010.SE, while it also has operations in Algeria, Tunisia, the Maldives, Saudi Arabia and the Palestinian Territories.
Total customers rose by 8.5 percent to 18.8 million from a year earlier.
"Foreign exchange movements in some of our key operations have impacted profitability, while our domestic market continues to face competitive challenges," Sheikh Abdullah Bin Saud al- Thani, Wataniya's chairman, said in the statement.
Domestic revenue in the first nine months of 2012 fell 7.2 percent to 172.1 million dinars despite Wataniya increasing its customer base by 3.7 percent from a year earlier. This led nine-month domestic profit to fall 25 percent over the same period to 41.4 million dinars.
Nine-month profits attributable to shareholders from its Tunisia and Algeria units were 32 million dinars and 11.2 million dinars respectively, up 11.4 percent and 42 percent.
But losses from Saudi Arabia unit Bravo, which provides services to government and corporate clients, widened to 6.6 million dinars from 4.5 million dinars.
In October, Qtel agreed to pay $1.8 billion to raise its stake in Wataniya to 92.1 percent from 52.5 percent.
Wataniya shares were down 1.7 percent on the Kuwait bourse at 0855 GMT. ($1 = 0.2809 Kuwaiti dinars)
(Reporting by Matt Smith; editing by Dinesh Nair and Keiron Henderson)
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