GCC Corporate Earnings-Q1-2012

1Q12 Earnings

GCC companies showed an earnings growth of 12% YoY 1 and 45% QoQ to USD 14.6bn. Large sequential increase in earnings (+45%) is due to dismal performance by companies in 4Q11 on account of weak petrochemical prices and increased last quarter provisioning by banks.

Earnings of Saudi Arabian companies totalled USD 6.7bn, an increase of 15% YoY and 28% QoQ. SABIC, which reported USD 1.9bn in 1Q profits, saw its bottom-line decline by 5% YoY due to softening of global petrochemical prices when compared to 1Q11. Saudi Banks continued its stable growth with earnings increasing 23% YoY and 27% QoQ to USD 2.0bn. Al Rajhi Bank reported an 18% YoY growth in net income to USD 536mn, on account of higher operational income. Telecom sector’s earnings grew 70% YoY to USD 853mn as Saudi Telecom’s earnings rose 60% to USD 672mn due to improved operational efficiency.