stc Group Net Profit Rises 7.7% to SAR 6.6 Billion in H1 2024

stc Group, Saudi Arabia’s leading digital and telecommunications company, announced preliminary financial results for the first half of 2024, reporting a 7.7% increase in net profit to SAR 6.6 billion compared to the same period last year. The results, released via the Saudi Press Agency (SPA), highlight the group’s robust performance driven by revenue growth and operational efficiency. Revenues rose by 4.79% to SAR 38.255 billion, with total profit up 3.88% to SAR 18.957 billion and EBITDA increasing 5.96% to SAR 12.889 billion. The group also declared a dividend of SAR 0.40 per share for the second quarter, reflecting its commitment to shareholder value.

Context and Background

stc Group, formerly known as Saudi Telecom Company, is a major player in the Kingdom’s digital transformation journey. The company’s performance is closely tied to Saudi Arabia’s Vision 2030, which aims to diversify the economy and enhance digital infrastructure. The first half of 2024 saw stc capitalize on growth in customer unit revenues, which increased by 6.0%, and subsidiary revenues, which surged by 13.4%. These gains underscore stc’s strategic expansion and its role as a key enabler of the Kingdom’s digital economy.

The telecommunications sector in Saudi Arabia is highly competitive, and stc’s ability to achieve such growth reflects its effective strategies, including the ‘Dare 2.0’ initiative, which focuses on innovation and customer-centric services. The company’s strong financial position allows it to continue investing in advanced technologies and infrastructure, supporting both its own growth and the broader national agenda.

Key Details

Eng. Olayan bin Mohammed Alwetaid, stc Group’s chief executive, praised the efforts of the group’s sectors and subsidiaries in enhancing its market position. He attributed the outstanding financial performance to the commitment to the ‘Dare 2.0’ strategy and a comprehensive cost efficiency program that improved profit margins through operational efficiency and cost control. Alwetaid highlighted that the program strengthened the company’s financial position and its ability to seize opportunities and invest in digital infrastructure, solidifying its role as the leading digital enabler in the Kingdom.

Alwetaid also commended Saudi Arabia’s efforts to provide exceptional services for Hajj pilgrims, noting stc’s commitment to leveraging technology for their comfort and safety. During the Hajj season, stc provided standard internet speeds to 1.8 million users in the holy sites and increased voice call volume by 65% compared to the previous year. This demonstrates stc’s dedication to supporting national events and enhancing the pilgrim experience.

Furthermore, stc signed a strategic partnership with the Esports World Cup Foundation to become the elite and founding partner of the Esports World Cup. This partnership aligns with Vision 2030’s goal to make Saudi Arabia a global hub for gaming and eSports. stc will provide high-quality telecommunications and IT services to cover all event facilities, ensuring the best digital infrastructure for participants and supporting the ‘Dare 2.0’ strategy.

Implications and Impact

The financial results and strategic initiatives position stc Group as a pivotal player in Saudi Arabia’s digital transformation. The increase in net profit and revenues not only reinforces stc’s market leadership but also contributes to the Kingdom’s economic diversification goals. By investing in digital infrastructure and forming partnerships, stc is enhancing the competitiveness of various sectors, including transportation and ports, through its Carrier and Wholesale Unit. For instance, collaborations with the Saudi Ports Authority, Saudi Global Ports Company, and Red Sea Gateway Terminal are improving operational efficiency and economic competitiveness.

On the international stage, stc’s growth and partnerships, such as with the Esports World Cup Foundation, elevate Saudi Arabia’s profile as a technology and entertainment hub. This attracts global attention and investment, further integrating the Kingdom into the global digital economy. The company’s success also serves as a testament to the effectiveness of Saudi Arabia’s Vision 2030 reforms in fostering a vibrant private sector and innovation-driven growth.

Vision 2030 Alignment

stc Group’s performance and initiatives are squarely aligned with Vision 2030, which seeks to transform Saudi Arabia into a diversified, knowledge-based economy. By expanding digital infrastructure, supporting events like the Esports World Cup, and enhancing services for Hajj, stc is directly contributing to the Kingdom’s goals of economic diversification, improved quality of life, and global engagement. As stc continues to innovate and invest, it remains a cornerstone of Saudi Arabia’s journey toward a prosperous and technologically advanced future.

20 Questions

Q1. What was stc Group’s net profit for the first half of 2024?

A1. stc Group reported a net profit of SAR 6.6 billion for H1 2024, representing a 7.7% increase compared to the same period in 2023. This growth reflects the company’s strong operational performance and strategic initiatives.

Q2. How much did stc’s revenues increase in H1 2024?

A2. Revenues increased by 4.79% to reach SAR 38.255 billion in H1 2024, driven by a 6.0% rise in customer unit revenues and a 13.4% increase in subsidiary revenues, showcasing broad-based growth across the group.

Q3. What is stc Group’s dividend per share for Q2 2024?

A3. stc announced a dividend distribution of SAR 0.40 per share for the second quarter of 2024, in line with its approved dividend policy, demonstrating its commitment to returning value to shareholders.

Q4. Who is the CEO of stc Group?

A4. Eng. Olayan bin Mohammed Alwetaid is the chief executive of stc Group. He has been instrumental in driving the company’s ‘Dare 2.0’ strategy and achieving outstanding financial performance.

Q5. What is the ‘Dare 2.0’ strategy?

A5. ‘Dare 2.0’ is stc Group’s strategic framework focused on innovation, customer-centric services, and digital transformation. It guides the company’s expansion and enables it to maintain leadership in the competitive telecommunications market.

Q6. How did stc support Hajj pilgrims in 2024?

A6. stc provided standard internet speeds to 1.8 million users in the holy sites and increased voice call volume by 65% compared to the previous season, ensuring seamless connectivity and enhancing the pilgrim experience during Hajj.

Q7. What partnership did stc sign for the Esports World Cup?

A7. stc signed a strategic partnership with the Esports World Cup Foundation to become the elite and founding partner. stc will provide high-quality telecommunications and IT services to support the tournament, aligning with Vision 2030’s gaming and eSports goals.

Q8. How does stc contribute to Vision 2030?

A8. stc contributes to Vision 2030 by investing in digital infrastructure, supporting events like the Esports World Cup, enhancing Hajj services, and driving digitalization across sectors. These efforts support economic diversification and technological advancement.

Q9. What was stc’s EBITDA in H1 2024?

A9. stc’s EBITDA increased by 5.96% to SAR 12.889 billion in H1 2024, reflecting improved operational efficiency and cost control measures that boosted profitability and financial strength.

Q10. What role does stc play in Saudi Arabia’s digital transformation?

A10. stc is the leading digital enabler in Saudi Arabia, providing advanced telecommunications and IT solutions. Its investments in infrastructure and technology support the Kingdom’s digital economy and Vision 2030 objectives.

Q11. How did stc’s subsidiaries perform in H1 2024?

A11. stc’s subsidiaries saw a 13.4% increase in revenues during H1 2024, contributing significantly to the group’s overall growth and demonstrating the success of its diversification strategy.

Q12. What cost efficiency program did stc implement?

A12. stc implemented a comprehensive cost efficiency program to enhance profit margins through operational efficiency and cost control. This program strengthened the company’s financial position and supported continued investment in digital infrastructure.

Q13. What partnerships does stc have in the transportation sector?

A13. stc partners with the Saudi Ports Authority, Saudi Global Ports Company, and Red Sea Gateway Terminal to provide digital services and solutions for the transportation and port sectors, improving performance and reducing costs.

Q14. How does stc’s performance reflect on Saudi Arabia’s economy?

A14. stc’s strong financial results reflect the robustness of Saudi Arabia’s telecommunications sector and the success of economic reforms under Vision 2030, showcasing the private sector’s role in driving growth.

Q15. What is stc’s position in the Saudi market?

A15. stc Group is the most influential local brand in Saudi Arabia, according to the 2023 Ipsos global index. It leads the market in digital services and telecommunications, consistently delivering innovative solutions.

Q16. How did stc’s total profit change in H1 2024?

A16. stc’s total profit rose by 3.88% to SAR 18.957 billion in H1 2024, supported by revenue growth and effective cost management, underscoring the company’s financial health.

Q17. What are stc’s key growth drivers?

A17. stc’s growth is driven by customer unit revenues, subsidiary performance, strategic partnerships, and investments in digital infrastructure. The ‘Dare 2.0’ strategy and cost efficiency program also play crucial roles.

Q18. How does stc support the gaming and eSports sector?

A18. stc supports the gaming and eSports sector through its partnership with the Esports World Cup Foundation, providing advanced telecommunications and IT services to ensure a world-class experience for participants and attendees.

Q19. What is stc’s approach to innovation?

A19. stc embraces innovation through its ‘Dare 2.0’ strategy, focusing on digital solutions, operational efficiency, and partnerships. It continuously invests in modern technologies to maintain its leadership and support Vision 2030.

Q20. What are stc’s future plans?

A20. stc plans to continue investing in digital infrastructure, supporting Vision 2030 initiatives, and expanding its partnerships. It aims to drive digitalization across sectors and maintain its position as the leading digital enabler in Saudi Arabia.

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