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Income Statements
|
As
Reported Annual Income Statement |
|||
|
Report
Date |
12/31/2010 |
12/31/2009 |
12/31/2008 |
|
Currency |
SAR |
SAR |
SAR |
|
Consolidated |
Yes |
Yes |
Yes |
|
Scale |
Thousands |
Thousands |
Thousands |
|
Revenue
from services |
51786828 |
50780087 |
47469368 |
|
Cost
of services |
21464230 |
0 |
0 |
|
Gross
profit |
30322598 |
0 |
0 |
|
Government
changes |
0 |
5664399 |
5541955 |
|
Access
changes |
0 |
7494284 |
6130577 |
|
Employee
costs |
0 |
6771597 |
6164272 |
|
Selling
& marketing expenses |
7083100 |
0 |
0 |
|
General
& administrative expenses |
3618983 |
0 |
0 |
|
Depreciation
& amortization |
8642204 |
7798739 |
6407514 |
|
Administrative
& marketing expenses |
0 |
7614336 |
7194289 |
|
Repairs
& maintenance |
0 |
2623145 |
2127821 |
|
Total
operating expenses |
19344287 |
37966500 |
33566428 |
|
Operating
income |
10978311 |
12813587 |
13902940 |
|
Cost
of early retirement |
-605559 |
-810914 |
-675000 |
|
Finance
cost |
1780670 |
1385300 |
0 |
|
Commissions
& interest |
308727 |
361957 |
1501375 |
|
Other
income/(expenses), net |
2076253 |
1151038 |
-2686961 |
|
Total
other income & (expenses), net |
-1249 |
-683219 |
-1860586 |
|
Net
income before Zakat, tax & non-controlling interests |
10977062 |
12130368 |
12042354 |
|
Provision
for Zakat |
118208 |
334513 |
375513 |
|
Provision
for tax |
820171 |
642042 |
456829 |
|
Net
income before non-controlling interests |
10038683 |
11153813 |
11210012 |
|
Non-controlling
interests' share |
602361 |
290457 |
172166 |
|
Net
income |
9436322 |
10863356 |
11037846 |
|
Year-end
shares outstanding |
2000000 |
2000000 |
2000000 |
|
Net
earnings per share - basic |
4.72 |
5.43 |
5.52 |
Source:
Analysis
The above table shows the
reported annual income statement of STC Telecom Company for the years from 2008
to 2010. The data shows a significant improvement in revenue of the companies from
services in 2010 as compare to 2008 i.e. 51786828 and 47469368 respectively. Furthermore,
a significant increase is observed in Depreciation & amortization as well
in 2010 as compare to 2008 i.e. 8642204 and 6407514 respectively. However, the
operating income of the company was decreased in 2010 as compare to 2008 i.e. 10978311
and 13902940 respectively.
Interestingly, Year-end shares
outstanding of the company is same for 2008, 2009, and 2010 i.e. 2000000. A
huge increase is recorded in Non-controlling interests' share in 2010 i.e. 602361
that was 290457 in 2009 and 172166 in 2008. Similarly, provision for tax also
increased consecutively from 2008 to 2009 and 2010 i.e. 456829, 642042, and 820171
respectively. On the other hand, provision for Zakat has significantly
decreased in 2010 as compare to 2008 i.e. 118208 and 375513 respectively.
Benefits of IFRS Conversion
In my opinion, after analyzing
the income statement of STC Telecom Company, the company as well as the Kingdom
of Saudi Arabia have gained benefits from IFRS Conversion. The access to
financial reporting has become much easy than earlier and the financial reports
are now timelier. The comparison of the performance of company over the years
has become easier. The financial information of the company seems to be consistent,
comparable, and transparent that is considered as a good guide for the investors
because they can make optimal investment decisions that either they should be
investing in STC Telecom Company or not.
Furthermore, the quality
reporting has took place in STC Telecom Company as well as in other companies
of Saudi Arabia. After this conversion, STC Telecom Company no longer have to maintain
the system of dual accounting.
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