October 07, 2008

Saudi Electricity posts biggest Q4 loss in 4 years

Saudi Electricity reported a loss of USD 144.8 million in October to December 2007 quarter, biggest quarterly loss in at least 4 years and twice as large as even the most pessimistic forecast.

Analysts' forecasts for October to December 2007 quarter losses ranged from SAR 63 million to SAR 286 million. It traditionally reports losses in the first and fourth quarters when temperatures moderate, reducing the need for air-conditioning and lowering consumption.

Saudi Electricity said that net income in 2007 rose by 6.9% YoY to SAR 1.51 billion. It added that "The increase in profit is due to a rise in sales from a higher number of subscribers."

Mr Ali bin Saleh Al Barrak CEO of Saudi Electricity said that "The moderate weather in the fourth quarter of the year reduced demand."

Saudi Electricity plans to invest SAR 190 billion to increase generating capacity by 59% to 54,000 MW by 2015 from 34,000 MW at the end of 2006 to meet surging demand. It also plans to invest about SAR 7 billion per year of its own funds and raise the rest through loans or Islamic bonds.