Saudi Electricity Company profit slides 17% as revenues fell

Company's results are seasonal because of the big swing between power demand in winter and summer

A Saudi Electricity Co plant near Riyadh. The firm has come in below estimates on earnings. Reuters

Saudi Electricity Company, the Arabian Gulf's largest utility firm, reported a 17.3 per cent drop in second-quarter net profit on Sunday as revenues from electricity services fell and financing costs rose.

The company, which the government is aiming to restructure to improve efficiency, made a net profit of 1.85 billion Saudi riyals (Dh1.81bn) in the three months to June 30, according to a bourse statement.

That compares with a profit of 2.23bn riyals in the same period a year earlier.

The results fell short of two analysts' forecasts. SICO Bahrain had expected a net profit of 2.11bn riyals, while NCB Capital forecast a net profit of 2.15bn riyals.

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SEC's results are seasonal because of the big swing between power demand in winter and summer, when high temperatures lead most homes and businesses to use more air conditioning.

Saudi Arabia's main sovereign wealth fund, the Public Investment Fund, owns 74 per cent of SEC. The kingdom will consider selling a large stake in SEC to SoftBank Vision Fund, but the Saudi government would retain a controlling shareholding, the utility said in October.