KUWAIT: Zain Group, a pioneer of mobile telecommunications across the Middle East and Africa, announces its consolidated financial results for the six months ended 30 June, 2015. Active customers served reach 46.3 million as at 30 June, 2015. Zain is the market leader in six of its eight operations by customer numbers.
Performance Indicators For the first six months of 2015, Zain Group generated consolidated revenues of USD 1.9 billion (KD 562 million) down 15% Year-on- Year (Y-o-Y) in US dollars (USD) terms (down 10% Y-o-Y in KD terms). The Group’s consolidated EBITDA for the period reached $806 million (KD241 million), down 14% Y-o-Y in USD terms (down 9% Y-o-Y in KD terms). EBITDA margin stood at a healthy 43% at the end of the period. Consolidated Net Income reached $269 million (KD80 million), down 34% Y-o-Y in USD terms (down 30% Y-o-Y in KD terms). Earnings per share for the period stood at $0.07 (Fils 21).
2nd quarter of 2015 For the second quarter of 2015, Zain Group generated consolidated revenues of $940 million (KD283 million). EBITDA for the quarter reached $411 million (KD124 million), resulting in a healthy EBITDA margin of 44%. Net Income for the quarter reached $130 million (KD39 million). Earnings per share for the quarter amounted to $0.03 (Fils 10).
Key Operational Notes:
- Consolidated Group data revenues (excluding SMS and VAS) witnessed a 10% growth rate Y-o-Y, with data now constituting 20% of the Group’s total revenues.
- Foreign currency translation impact mainly due to the appreciation of the USD cost the company USD 57 million on revenue, USD 26 million on EBITDA and USD 13 million on net income. 3. Healthy growth in Zain Saudi Arabia saw the operation increase its customer base by 25% to serve 11.
3 million customers, with net losses narrowing by 29% Y-o-Y.
- Zain Sudan performed extremely well as revenues increased by 6% and net income by 31% (in USD terms) Y-o-Y.
- Zain Iraq completed its operating licence requirement of listing on the Iraq Stock Exchange on 23 June, 2015, offering 25% of the company’s equity to the public.
- The continued social instability in Iraq and heightened levels of competition severely impacted Zain Iraq’s and consequently the Group’s overall key financial metrics
- Zain Group entered into the area of venture capital investment through several strategic participations in Middle East Venture Partners’ (MEVP) latest fund and WAMDA’s future growth fund, both of which invest in early stage and growth technology companies.
- Zain Group announced the expansion of its existing Partner Market Agreement with Vodafone, to deliver Machine-To-Machine (M2M) services to Enterprise and Government sectors across the region.
Commenting on the results, the Chairman of the Board of Directors of Zain Group, Asaad Al Banwan said: “Zain Group continues to deal with the diverse market and social challenges that it faces to the best of its ability, especially in conflict areas where circumstances beyond our control have impacted our overall key financial results for the six month period.” The Chairman continued, “The Board is working closely with senior management in driving efficiency and cost optimization, upgrading and expanding our networks, maintaining our market leadership positions across our country operations, and constantly evaluating business-enhancing and acquisition opportunities. The Board is confident that the company’s innovation and digital strategy will generate long-term value for shareholders.” Zain Group CEO, Scott Gegenheimer noted, “Although our digital transformation and efficiency drive efforts are well on track across many of our operations, we are disappointed by the severe impact that the increased social instability and intense competition in Iraq is having on our overall financial results for the year to date.
Nevertheless we are encouraged to see growth of our customer base in key markets, with both Saudi Arabia and Sudan witnessing healthy growth in all of their key financial indicators.” Gegenheimer added, “We will continue to focus on and invest in our key markets to drive growth and efficiency and we remain focused on further exploiting our state-ofthe- art 3G and 4G infrastructure and concentrating on new sources of incremental revenue in the digital space including enterprise services such as smart cities and M2M services, embracing the areas of future value realization within the telecoms sector.”
