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Saudi Aviation, Travel Industry Financing to Exceed $37 Billion

Saudi Economy and Planning Minister Faisal al-Ibrahim delivers a speech at the Future Aviation Forum in Riyadh (Asharq Al-Awsat)
Saudi Economy and Planning Minister Faisal al-Ibrahim delivers a speech at the Future Aviation Forum in Riyadh (Asharq Al-Awsat)
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Saudi Aviation, Travel Industry Financing to Exceed $37 Billion

Saudi Economy and Planning Minister Faisal al-Ibrahim delivers a speech at the Future Aviation Forum in Riyadh (Asharq Al-Awsat)
Saudi Economy and Planning Minister Faisal al-Ibrahim delivers a speech at the Future Aviation Forum in Riyadh (Asharq Al-Awsat)

Saudi Arabia’s Economy and Planning Minister Faisal al-Ibrahim has revealed that the Kingdom plans to boost its financing of travel, tourism, and aviation sectors. The finance ceiling will be raised to over SAR 140 billion ($37 billion), according to the minister.

Saudi Arabia has embarked on implementing digital application, e-government and attracting efficiencies due to the challenges facing the aviation sector in the world, al-Ibrahim said, noting that airports in Saudi Arabia, through Saudi Vision 2030, will provide several job opportunities to enhance national investments.

Al-Ibrahim’s remarks came at the Future Aviation Forum in Riyadh on Tuesday.

After the coronavirus pandemic, the Saudi economy began a rapid transition to revitalizing its aviation sector and industry, the minister pointed out.

He added that the Kingdom laid the foundations for investment in this field, stressing the need for countries of the world to focus on the sectors of the aviation industry because of its impact in promoting economic growth.

Al-Ibrahim called on decision-makers worldwide to focus on sustainability plans.

Delivering a speech during the Forum, organized by the General Authority for Civil Aviation in Riyadh, the minister noted that the Kingdom is ready for investment and development for the recovery from the pandemic, and for preparing global policies and procedures that match the new economy, adding that the economy has resumed after the pandemic and moved to stimulating the aviation sector and its industry.

He added that the Kingdom’s civil aviation sector was a fertile environment for investments.

Al-Ibrahim acknowledged that the development took a lot of effort in the system of legislative policies and the economy, stressing that in the wake of the pandemic, a greater appetite opened to attract investments.

“The Kingdom has put in place all the reasons for preparing to achieve this, as it is currently enjoying flexibility and recovery, and is compatible with the new economy,” he said.

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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.