Qatar Telecom QSC fell the most in more than eight months after the phone operator’s fourth-quarter profit missed analysts’ estimates.
Shares of the company, known as Ooredoo, dropped 3 percent, the most since June 28, to 112 riyals at the close in Doha. Trading volume was more than double the three-month daily average at 184,875 shares and the stock was the biggest decliner on the benchmark QE Index, which slipped 0.2 percent.
Ooredoo, the Arab world’s second-biggest phone company by sales, said yesterday quarterly net income rose 15 percent to 523 million riyals ($144 million), missing the 762 million-riyal median estimate of three analysts compiled by Bloomberg. Revenue growth of 6 percent was driven “by healthy increases in Iraq, Algeria, Qatar and Indonesia supported by a stable performance by Nawras,” the company’s Oman unit, Ooredoo said, without providing further detail.
“Although international business is supporting the company’s earnings, its local business has shown flat figures,” said Tariq Qaqish, deputy head of asset management at Dubai- based Al Mal Capital PSC. “For a company which is looking to acquire more assets, they need cash for future growth.”
Ooredoo, which derived 18 percent of third-quarter revenue from Qatar, posted a 29 percent drop in cash holdings in 2012, data compiled by Bloomberg show. The company, which is mulling expansion into Libya and Southeast Asia, is considering a bid for Vivendi SA (VIV)’s 53 percent stake in Maroc Telecom SA (IAM) and expects no difficulty financing the deal, Nasser Marafih, chief executive officer said last week. Emirates Telecommunications Corp. (ETISALAT), or Etisalat, is also vying for the stake.
Nine analysts recommend investors buy the shares of Ooredoo. The company, which recommended a 2012 cash dividend of 5 riyals a share, has a 12-month dividend yield of 1.8 percent, compared with 5.9 percent for Etisalat, the Middle East and North Africa’s largest phone company by market value.
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