LOC18:45
15:45 GMT
KUWAIT, May 8 (KUNA) -- Zain Group, the pioneer of mobile
telecommunications across the Middle East and North Africa, announces today
its consolidated financial results for the three months ending 31 March, 2013.
Zain Group added 3.9 million new active customers over the past twelve
months to now serve 44.1 million, reflecting a 10pct growth rate, said the
group's chairman of the board Asaad al-Banwan in a press statement.
The Group added 1.4 million customers during the first three months of
2013. Zain is a market leader in six of its eight operations, he said.
For the first quarter of 2013, Zain Group recorded consolidated revenues of
USD 1.06 billion (KD 299 million), and the company's consolidated EBITDA for
the same period reached USD 449 million (KD 127 million), reflecting a healthy
EBITDA margin of 42.4pct.
Consolidated Net Income reached USD 184 million (KD 52 million),
representing a 3pct increase on the fourth quarter of 2012. Earnings per share
for the quarter stood at USD 0.05 (KD 0.013).
Among key Group Quarter operational notes:
1. Adverse currency translation impact in Sudan costs the company the
equivalent of USD 179 million in revenues, USD 76 million in EBITDA and USD 44
million in net profit for the quarter.
2. Although Zain Saudi Arabia continues to narrow its operating loss, Zain
Group's increased ownership from 25pct to 37pct pressures Group operating
results.
3. The gap between traditional voice and data revenues reduce as data
revenues see impressive 14pct growth.
4. Shareholders receive USD 685 million (KD 195 million) cash distribution
after Annual General Assembly Meeting approved dividends of 50pct of share
face value (50 fils).
5. Benefits of Vodafone Partner agreement began to take effect as Zain
agrees to pilot the 'joyn' Rich Communications Services initiative formulated
by the GSM Association. The service will allow the company to compete more
effectively against OTT players by providing customers access to leading-edge
technology and services in a shorter period of time. The Zain brand was also
exposed to a global motor racing audience as the Vodafone Mercedes McLaren
cars and team were branded Zain during the recent Bahrain Grand Prix.
Commenting on the results, the Chairman of the Board al-Banwan said: "It is
promising from a forward-looking perspective to see the addition of 3.9
million customers notwithstanding the Group's key financial indicators having
been impacted by adverse currency fluctuations, and to a lesser extent by the
Group's increased stake in Zain Saudi Arabia."
The Chairman also noted, "Our substantial investment in expanding and
upgrading our 3G and 4G networks across our markets are paying off and
continual attention to such areas is necessary to maintain the company's
growth momentum."
On his part, Zain Group CEO, Scott Gegenheimer noted, "Operationally our
Group companies are performing well in local currency terms and despite
intense competitive challenges, they are all attaining the targets set at the
beginning of the year. The adverse effect on our financial results by the
devaluation of the Sudanese pound, which fell by 53pct against the US dollar
over the last 12 months, is unavoidable as there is no effective hedge on the
currency."
Gegenheimer added, "Our focus today is to drive efficiency and to build on
our many competitive strengths with the aim to cement our market leadership
position in the countries we serve. Empowering our customers with the latest
innovative technologies is a critical focus and the 14pct growth in data
revenues reflects positively on our efforts and investments in this area. We
expect data revenue growth to continue, in line with industry trends
worldwide".
The percentage growth in data revenues is all the more significant and
promising for Zain when one considers that a large number of the Group's
customers do not yet have smartphones and are located in rural areas across
several countries that are vast in their geographies.
With regard to ongoing dealings that will be further elaborated in the near
future, Gegenheimer noted that the Group is currently examining several prime
adjacent business and key partnership opportunities that if successfully
completed, will be accretive to both operational efficiency and shareholder
value. The company is also in the final stages of entering into numerous
commercial and customer enhancing agreements that will improve the Zain
service experience.
As for Zain's country operational year-on-year growth, it is to be noted
that in Kuwait, Zain launched nationwide 4G LTE with year-on-year customer
growth of 9pct.
In Bahrain: Customer base grew by 30pct; recently launched 4G LTE.
In Iraq: Customer base grew by 9pct as operation expands network to North
Iraq.
In Jordan: Zain maintains customer and value leadership through dynamic
marketing campaigns.
In Lebanon: Management contract extended to 30 June 2013.
In Saudi Arabia: 4G LTE network and aggressive marketing campaigns
contribute to 32pct customer growth, revenue growth of 17pct.
In Sudan: In SDG currency terms, revenues grew by 25pct year-on-year, net
income grew by 57pct , and in South Sudan: Customer base grew by 44pct while
revenues grew by 8pct . (end)
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