Zain group’s net profits for FY 2016 go up 2% YoY

Results impacted by currency devaluation in Sudan and tax disputes in Iraq
Al Banwan: "I remain proud that we have been able to maintain our leadership position in the majority of the markets we operate in."
Al Banwan: "I remain proud that we have been able to maintain our leadership position in the majority of the markets we operate in."

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Zain Group's full year 2016 net profits went up 2% as the company recorded revenues of KD 1.1 billion ($ 3.6 billion). Zain ended the year serving 47 million customers, reflecting a 3% increase YoY.

Chairman of the Board of Directors of Zain Group, Asaad Al Banwan said: "The currency issue in Sudan in the last quarter of 2016 had an adverse impact on the results, as did the settlement of cumbersome litigation in Iraq that resulted in a payment of $93 million. Nevertheless, we draw confidence from both the freeing of our cash deposits in Iraq and the favorable gesture by the Saudi leadership in extending our licence in the Kingdom by an additional 15 years, which had a positive impact on the operation’s financials and growth strategy.”

The Board of Directors have recommended a cash dividend of 35 Fils per share subject to approvals.

Group data revenues (excluding SMS and VAS) increased 6% during 2016, representing 23% of the group’s consolidated revenues.

Zain Group CEO, Scott Gegenheimer said: “We are delighted by the success of our data monetisation and Enterprise (B2B) initiatives across our operations, both of which are fast-growing and profitable business areas. During 2016 in key operations, we built-up dedicated B2B business units and premium B2B care models, installed state-of-the-art IoT/M2M platforms as well as developing new service propositions for Small Medium Enterprises and small home offices, leading to high-double digit sales growth. We are excited by the enormous potential that B2B offers and will continue to invest in and develop this strategic area of the business.”

The CEO is further hopeful that the group's strategic investment in smart city solutions is starting to reap benefits and expects exponential growth in this area.

CAPEX spend for the year amounted to $635 million (excluding Saudi Arabia), reflecting 18% of the group's revenues. The group invested most in 3G and 4G network expansion upgrades across its operations.

FY 2016 for Zain:

Total active customers: 47 million (+ 3% YoY)
Consolidated revenues: KD 1.1 billion ($ 3.6 billion)
EBITDA: KD 512 million ($1.7 billion)
EBITDA margin: 47%
Net income: KD 157 million ($519 million)
EPS: 40 Fils ($0.13)

Q4 for Zain:

Consolidated revenues: KD 261 million ($860 million)
EBITDA: KD 122 million ($400 million)
EBITDA margin: 47%
Net income: KD 32 million ($106 million)
EPS: 8 Fils($0.03)

 

Operational review of key markets:

Kuwait:

Customer base: 2.95 million (+1% YoY)
Revenues: KD 322 million ($1.1 billion)
EBITDA: KD 160 million ($531 million)
Net income: KD 90 million ($298 million)
EBITDA margin: 50%
Data revenues: 36% of total revenues

Iraq:

Revenues: $1.1 billion -(11% YoY)
EBITDA: $394 million (-18% YoY)
Net loss: $5 million (-104% YoY)
EBITDA margin: 36%
Data revenues: 9% of total revenues (+ 21% YoY)

Sudan:

Revenues: SDG 5.2 billion (+15% YoY) ; $709 million (-1% YoY)
EBITDA: SDG 2.1 billion (+4% YoY) ; $290 million (-7%)
Net income: SDG 398 million (-62% YoY); $91 million (-44% YoY)                                                                                   Data revenues: 13% of total revenues (+42% in SDG; +23% in $)

Saudi Arabia:

EBITDA: $479 million (+10% YoY)
EBITDA margin: 25%
Revenues: $1.9 billion (+2% YoY)
Net losses: $261 million
Customer base: 10.7 million (-10% YoY; affected by introduction of biometric identification requirement)
Data revenues: + 36% YoY (33% of total revenues)

Jordan:

Customer base: 4.3 million (+5% YoY)
Revenues: $483 million (+5% YoY)
EBITDA: $240 million
EBITDA margin: 50%
Net income: $105 million
Data revenues: 34% of total revenues (+23% YoY)

Bahrain:

Revenues: $175 million (- 9% YoY)
EBITDA: $66 million (-12%)
EBITDA margin: 38%
Net income: $11 million (-17%)
Customer base:971,000 ( + 22% )
Data revenues: +11% YoY (41% of overall revenues)

 

 

 

 

 

 

 

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