Dubai: Etisalat group said on Thursday that it supports the steps taken by the Mobily board of directors to restate 18 months of profits and has full confidence it will overcome this issue and return to growth again.
The statement by the UAE telecom operator, which owns 27.46 per cent stake in the Saudi Arabian company, however, failed to bolster Mobily shares and it fell on the Saudi bourses for the third straight day by 10 per cent to 58.50 Saudi riyals (Dh57.27) on Thursday, taking the stock’s losses to 27 per cent since it resumed trading on Tuesday.
Etisalat also closed 0.44 per cent lower at Dh11.40 on the Abu Dhabi Stock Exchange.
Mobily slashed its profits for 2013 and the first half of 2014, citing accounting errors, by a combined 1.43 billion riyals on Monday.
“We understand further that the Mobily Board/audit committee has commenced a thorough review of the matter and we are discussing with them further action that might be taken,” Etisalat said in a statement.
Etisalat had slashed its profits by Dh162 million due to the accounting errors. It is also in coordination and contact with Saudi Arabian Government authorities and will be keeping them fully apprised of actions taken.
“We are entering a transformation phase with Mobily which we are confident will further add to our future growth and the strength of our offering throughout the Kingdom,” Ahmad Abdul Karim Julfar, chief executive officer of Etisalat Group, said recently.
Saudi is an important market for Etisalat as it believes in its growth potential and the opportunities it brings to Mobily. Moreover, international operations are contributing 48 per cent to the group’s revenue as of third quarter and hopes that international operations will continue to grow on track to contribute at least 50 per cent of its overall revenues.
Mobily contributed Dh1.18 billion to Etisalat’s Dh7.08 billion profit in 2013 and Dh469 million to Etisalat’s Dh6.75 billion profit for the nine months this year.
