(Adds detail, background)
RIYADH, April 21 Saudi Telecom Co
(STC), the Gulf's No.2 telecom operator, missed forecasts with a
38.5 percent year-on-year plunge in first-quarter net profit on
Sunday attributed to charges relating to an Indian affiliate.
The firm, still majority government-owned nearly a decade
after being listed, posted a net profit of 1.55 billion riyals
($413 million) for the three months to March 31, down from 2.52
billion riyals a year earlier.
STC was expected to post a profit of 2 billion riyals, a
Reuters poll of analysts showed.
The company said in a separate statement that it would
distribute first-quarter dividends of 0.5 riyals per share.
It said its gross profit rose 2.6 percent but it had to take
"non-cash charge of 500 million riyals" relating to Aircel, an
affiliate in India.
Two STC chief executives have quit in less than a year,
while the heads of its domestic and international operations
also resigned within the same period.
Its main competitor, Etihad Etisalat (Mobily),
reported an 11 percent rise in first quarter net profit on
STC's quarterly revenue for services rose to 11.5 billion
riyals from 11.1 billion a year earlier.
Rising demand for broadband lifted earnings in the first
nine months of 2012, but the company then reported a 79 percent
drop in fourth-quarter profit citing rising costs and one-off
charges at its Indian and South African affiliates.
(Reporting by Angus McDowall; editing by Jason Neely)