Zain Saudi says Q3 loss swells 26.3 pct

RIYADH, Oct 20 (Reuters) - Zain Saudi Arabia 7030.SE posted a 26.3 percent rise in its net loss for the third-quarter due to growing costs of operations and marketing, 13 months after starting operations in the Saudi market.

The firm, in which Kuwait-based Zain (ZAIN.KW) holds a 25 percent stake, made a net loss of 820 million riyals ($218.7 million) in the three months to end-September, up from 649 million riyals a year earlier, it said in a statement.

The firm attributed the rise in the loss to the growing costs of depreciation, operations and marketing.

Revenues increased to 825 million riyals in the third-quarter, up from 701.5 million riyals in the second quarter of 2009 and 81 million riyals during the third quarter of last year.

The company started operations in August, 2008.

Zain Saudi Arabia competes with Saudi Telecom 7010.SE and Etihad Etisalat 7020.SE.

"The firm has realised a new breakthrough in the growth of its market share during this quarter by grabbing more than 15 percent of the volume of the mobile telecommunications market in the kingdom," it said.

A company spokesman later clarified that Zain Saudi Arabia reached 15 percent market share of overall mobile phone users in the kingdom. Zain Saudi had 4 million active users at the end of June, he said.

There are no official figures on the number of mobile phone users in the kingdom, but industry analysts say they exceed the country's 25 million population, with some 70 percent of them being active users.

(Reporting by Souhail Karam, Editing by Natsuko Waki)