Zain Saudi Ara­bia con­tin­ues to grow

Com­pany records prof­its for sec­ond con­sec­u­tive quar­ter

Kuwait Times - - FRONT PAGE -

KUWAIT/RIYADH: Zain Saudi Ara­bia (Zain KSA) re­ported its sec­ond con­sec­u­tive quar­terly net profit and its first ever, half year net profit for the pe­riod end­ing 30 June 2017. Data ser­vices growth lever­ag­ing the ad­vanced 4.5G LTE net­work, pru­dent man­age­ment of op­er­a­tional costs and the ef­fect of the 15-year li­cense ex­ten­sion were the main con­tribut­ing fac­tors to the pos­i­tive per­for­mance of the com­pany.

Key per­for­mance indi­ca­tors for the 2nd quar­ter of 2017 when com­pared to Q2 2016, Zain KSA recorded: Rev­enues of SAR 1.865 bil­lion, up 8 per­cent; Gross profit of SAR 1.259 bil­lion, up 13 per­cent; EBITDA of SAR 632 mil­lion, up 70 per­cent; Op­er­a­tional in­come of SAR 235 mil­lion; Quar­terly net profit amount­ing to SAR 8 mil­lion, (six-month net profit of SAR 53 mil­lion).

Bader Nasser Al-Kharafi, Zain Group Vice-Chair­man and CEO; and ViceChair­man of Zain Saudi Ara­bia com­mented: “The strong per­for­mance of this promis­ing oper­a­tion in the first six months of 2017 are at­trib­uted to pru­dent man­age­ment in im­ple­ment­ing the turn­around pro­gram that fo­cuses on op­er­at­ing ef­fi­cien­cies, net­work up­grades, cus­tomer ser­vice and data mon­e­ti­za­tion ini­tia­tives com­bined with the pos­i­tive ef­fect of the li­cense ex­ten­sion by an ad­di­tional 15 years.”

For the sec­ond quar­ter of 2017, Zain KSA wit­nessed an 8 per­cent in­crease in rev­enues to reach SAR 1.865 bil­lion. Im­pres­sively, Zain KSA recorded a sig­nif­i­cant 70 per­cent in­crease in EBITDA to reach SAR 632 mil­lion dur­ing Q2 2017 up from SAR 372 mil­lion dur­ing Q2 2016 with an EBITDA mar­gin reach­ing 34 per­cent com­pared to 22 per­cent in Q2 2016. This im­prove­ment re­flects the pos­i­tive ef­fects of man­age­ment’s ef­forts in driv­ing ef­fi­cien­cies and op­ti­miz­ing the com­pany cost struc­ture.

Zain KSA also re­ported a 13 per­cent in­crease in gross profit to reach SAR 1.259 bil­lion for Q2 2017, re­flect­ing a gross mar­gin of 67 per­cent. A much-im­proved op­er­a­tional in­come of SAR 235 mil­lion was recorded for Q2 2017, com­pared to an op­er­a­tional loss of SAR 108 mil­lion in Q2 2016. Notably, the com­pany an­nounced its sec­ond se­quen­tial quar­ter of net profit ever in Q2, 2017, amount­ing to SAR 8 mil­lion, com­pared to net losses of SAR 328 mil­lion in Q2, 2016. The first six-month of 2017 net profit recorded by the oper­a­tion was SAR 53 mil­lion.

Kharafi noted, “The Saudi mar­ket faces on­go­ing chal­lenges in terms of de­creas­ing to­tal num­ber of sub­scribers due to bio­met­ric re­quire­ments which re­sulted in 6.5 mil­lion fewer sub­scribers in the last 12 months and in­creased com­pe­ti­tion. Dur­ing the sec­ond quar­ter, Zain KSA also suc­cess­fully se­cured ad­di­tional 1800MHz spec­trum which is crit­i­cal to the de­liv­ery of high qual­ity data ser­vices across the king­dom. Strate­gic ex­pan­sion of our 4.5G LTE net­work’s cov­er­age and ca­pac­ity is im­por­tant to de­liv­er­ing faster more re­li­able data ex­pe­ri­ences and in­creas­ing cus­tomer sat­is­fac­tion re­sult­ing in im­prov­ing our brand im­age.”

Fur­ther­more, Kharafi said, “Zain has re­tained its mar­ket share and con­tin­ues to fo­cus on in­creas­ing the “share of wal­let” from our cus­tomer base, re­duc­ing churn and im­ple­ment­ing a dis­ci­plined, op­er­a­tional ef­fi­cien­cies pro­gram to re­duce ex­pen­di­tures.” Kharafi added, “Zain KSA con­tin­ues to ex­plore op­por­tu­ni­ties with se­lected part­ners, to com­ple­ment our wire­less ser­vices port­fo­lio and in­tro­duce high speed broad­band ser­vices based on the lat­est, ad­vanced fiber tech­nol­ogy.”

Kharafi con­cluded, “I would like to rec­og­nize the ded­i­ca­tion of the en­tire Zain team in Saudi Ara­bia, and the con­tin­ued sup­port of the Board of Di­rec­tors of both Zain Group and Zain Saudi Ara­bia, our share­hold­ers and the Zain Group man­age­ment team in the turn­around of this promis­ing tele­com en­tity. We re­main fo­cused on our strate­gic pri­or­i­ties to con­tin­u­ally im­prove all as­pects of this key strate­gic oper­a­tion for Zain Group.”

Zain Vice-Chair­man and Group CEO Bader Al-Kharafi

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