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Saudi’s Mobily Scraps Q3 Dividend After Earnings Error

Saudi’s Mobily Scraps Q3 Dividend After Earnings Error

The move comes after the telecommunications firm posted a shock third-quarter profit drop last week due to the accounting issues.

Saudi Arabia’s Etihad Etisalat (Mobily), which has seen its share price fall by the daily limit for three straight days since reporting an accounting error on Monday, said it would not distribute a dividend for the third quarter.

The firm, under investigation by the bourse regulator after restating a year and a half of earnings, also said it would evaluate whether to pay shareholders in the coming quarters.

The move, announced in a bourse filing, comes after the telecommunications firm on Monday posted a shock third-quarter profit drop due to the accounting issues.

Shares in Mobily, the kingdom’s No.2 operator, have fallen their maximum daily amount of 10 per cent since trading resumed on Tuesday, having been halted last Thursday at the company’s behest, and are at a 27-month low.

Shareholder sentiment is likely to be further damaged by Thursday’s post-trading announcement from the company, 28-percent owned by the United Arab Emirates’ Etisalat .

“The company will evaluate the feasibility of distribution of dividends for the coming quarters, in line with the company goals and aspirations of the investors,” it added.

It is the first time since the third quarter of 2011 that the company has failed to pay a quarterly dividend, according to Thomson Reuters data.

Mobily paid shareholders 1.2 riyals ($0.32) per share in the third quarter of 2013.

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