After taking my CO OP with KPMG under the Saudi Telecom contract, I had to give a presentation to my university KFUPM about the situation of Telecom industry in Saudi Arabia.
9. STC Profile - Largest telecom operator in the MENA region - Over 19,500 employees - 98% coverage of populated areas and highways - 19 million mobile subscribers, 4.1 million fixed subscribers and over 1million Broadband subscribers as at 31stDec. 2008
13. Liquidity Ratios The Current ratio = Current Assets/Current liabilities A part of surplus cash is invested in Murabaha deals with maturity periods of 90 days or less with Several local banks Quick ratio = (current assets-inventories)/current liabilities
14. Net working capital = current assets – current liabilities Cash ratio = (Cash + Marketable securities)/ Current liabilities
15. The profitability Ratios Gross Profit Margin = Gross Profit / Sales Net Profit Margin = Net Income/Sales The increased currency losses and tax provisions were mainly due to increased international operations of STC through its subsidiaries
16. Return on Total Assets = EBIT / Total Assets 1- Increasing competition in the domestic GSM market. Return on Equity = Net Income/Total Equity 2- the increase in the operating expenses.
17. The Payout Ratio = Div./Net Income The Plowback Ratio = 1 – Payout Ratio Growth in Equity = Plowback ratio * ROE
18. HAJJ EFFECT ON PROFITABILITY Mobily vs. STC : 3 million pilgrimages come to SA, Roaming revenues increase
19. The leverage Ratios Equity Multiplier = Total Assets/ Total Equity Debt Ratio = Total Liabilities/Total Assets Debt to Equity = Total Liabilities/ Equity
25. 1- The mechanism of choosing managers, employees in STC must be developed 2- More Focus on the local market 3- I expect Mobily is going to beat STC more on the market share side, taking advantage of the internal systematic problems in STC 4- From 1998 until now, STC monopolizes the Saudi wired line voice operations. The introduction of 3 new fixed line licenses will negatively affect STC’s wired line revenues