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Suez Canal Authority: Revenues Drop 40% Since Beginning of the Year

A container ship of Mediterranean Shipping Company (MSC) transits the Suez Canal towards the Red Sea (EPA)
A container ship of Mediterranean Shipping Company (MSC) transits the Suez Canal towards the Red Sea (EPA)
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Suez Canal Authority: Revenues Drop 40% Since Beginning of the Year

A container ship of Mediterranean Shipping Company (MSC) transits the Suez Canal towards the Red Sea (EPA)
A container ship of Mediterranean Shipping Company (MSC) transits the Suez Canal towards the Red Sea (EPA)

Dollar revenues from Egypt's Suez Canal have dropped 40% from the beginning of the year compared to 2023, canal authority head Osama Rabie said on Thursday.
The drop was reported after attacks on ships in the Red Sea by Yemen's Houthis which caused major shippers to divert away from the route, according to Reuters.
Rabie said in a late television program that ship transit traffic declined 30% between Jan. 1 and 11 compared to a year prior.
He said the number of vessels to pass through the Suez Canal dropped to 544 this year from 777 in the equivalent period of 2023.
The Suez Canal is a crucial source of scarce foreign currency for Egypt, and authorities have been trying hard to boost revenues recently, including through a canal expansion in 2015. A further expansion is underway.
The Houthis have been attacking commercial ships in the Red Sea for weeks to support Hamas in the war against Israel.
Many commercial shippers are diverting their ships to other routes.
Last month, the US announced a new international mission to patrol the Red Sea and deter attacks.
Rabie said only ships that had to proceed promptly with their journey had diverted around the Cape of Good Hope and that others were waiting for the situation to stabilize.
He said the security concern to shippers could not be overcome with discounts or other incentives offered by the canal.

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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)

Telecommunications companies listed on the Saudi Stock Exchange (Tadawul) achieved a 12.46 percent growth in their net profits, which reached SAR 4.07 billion ($1.09 billion) during the second quarter of 2024, compared to SAR 3.62 billion ($965 million) during the same period last year.

They also recorded a 4.76 percent growth in revenues during the same quarter, after achieving sales worth more than SAR 26.18 billion ($7 billion), compared to SAR 24.99 billion ($6.66 billion) in the same quarter of 2023.

The growth in the revenues and net profitability is the result of several factors, including the increase in sales volume and revenues, especially in the business sector and fifth generation services, as well as the decrease in operating expenses and the focus on improving operational efficiency, controlling costs, and moving towards investment in infrastructure.

The sector comprises four companies, three of which conclude their fiscal year in December: Saudi Telecom Company (STC), Mobily, and Zain Saudi Arabia. The fiscal year of Etihad Atheeb Telecommunications Company (GO) ends on March 31.

According to its financial results announced on Tadawul, Etihad Etisalat Company (Mobily) achieved a 33 percent growth rate of profits, bringing its profits to SAR 661 million by the end of the second quarter of 2024, compared to SAR 497 million during the same period in 2023. The company also achieved a 4.59 percent growth in revenues to reach SAR 4.47 billion, compared to SAR 4.27 billion in the same quarter of last year.

The Saudi Telecom Company achieved the highest net profits among the sector’s companies, at about SAR 3.304 billion in the second quarter of 2024, compared to SAR 3.008 billion in the same quarter of 2023. The company registered a growth of 4.52 percent in revenues.

On the other hand, the revenues of the Saudi Mobile Telecommunications Company (Zain Saudi Arabia) increased by about 6.69 percent, as it recorded SAR 2.55 billion during the second quarter of 2024, compared to SAR 2.39 billion in the same period last year.

Commenting on the quarterly results of the sector’s companies, and the varying net profits, the head of asset management at Rassanah Capital, Thamer Al-Saeed, told Asharq Al-Awsat that the Saudi Telecom Company remains the sector leader in terms of customer base expansion.

He also noted the continued efforts of Mobily and Zain to offer many diverse products and other services.

Financial advisor at the Arab Trader Mohammed Al-Maymouni said the financial results of telecom sector companies have maintained a steady growth, up to 12 percent, adding that Mobily witnessed strong progress compared to the rest of the companies, despite the great competition which affected its revenues.

He added that Zain was moving at a good pace and its revenues have improved during the second quarter of 2024. However, its profits were affected by an increase in the financing cost by SAR 26.5 million riyals and a rise in interest, while net income declined significantly compared to the previous year, during which the company made exceptional returns.