(MENAFN - Arab Times) Zain Group, the pioneer in mobile telecommunications in eight markets across the Middle East and North Africa, announces today its consolidated financial results for the half-year ended June 30, 2012.
The results reflected a stable performance year-on-year in the face of challenging industry and global economic environments.
H1, 2012 Key Performance Indicators
Customers 41.4m up 5% on H1, 2011
Revenues KD 663.5m ( 2.384 billion)
EBITDA KD 299 m ( 1.074 billion)
Net Income KD 141.9 m 509.6 million)
EPS KD 0.036 ( 0.13)
For the first half of 2012, Zain Group generated consolidated revenues of KD 663.5 million ( 2.384 billion), reflecting around 1% increase over the same period of H1, 2011. The net income witnessed an increase of 1% year-on-year to reach KD 141.9 million ( 509.6 million). The Group's consolidated EBITDA reached KD 299 million ( 1.074 billion) up 2% over the same period of last year, and reflected an EBITDA margin of 45.1% (up 0.6 pp). The earnings per share reached 36 fils ( 0.13).
Year-on-year customer growth across all Zain operations was almost 5%, with the Group serving 41.4 million active customers as of June 30, 2012.
Remarks from the Chairman and CEO:
Commenting on the results, the Chairman of the Board of Directors of Zain Group, Asaad Al Banwan said: "The Group's consolidated revenues for H1-2012 grew around 1% as compared to the same period in 2011, which is a positive outcome given the challenging environment in the sector. The increase in consolidated revenues to KD 663.5 million ( 2.384 billion), up around 1% year-on-year, highlights Zain's ability to sustain a high level of performance despite substantial competitive pressures and currency fluctuations in many of the markets in which it operates."
Al Banwan also noted that: "A growing number of customers continue to benefit from utilizing Zain's services, with 1.8 million customers added in the 12 months to June 30, 2012, representing almost 5% growth rate. Our strategy is focused on achieving greater leadership across all our operations, and we remain determined to provide the latest technology along with high quality services to our customers."
Zain Group CEO Nabeel Bin Salamah said: "Zain continues to be a pioneer in the markets in which it operates despite competitive, economic, and political pressures in many of our countries of operation. We are facing these challenges head-on, having reduced our funding costs, as well as continuing with our policy to actively reduce administrative and operational expenses."
Bin Salamah continued: "Our operations achieved great success in data services during H1, 2012 due to a favorable series of expansion and development programs that were launched last year and have since gained traction. Mobile broadband and data transfer remain definite growth areas for Zain Group and we intend to continue investing in these areas in order to meet customer expectations while also increasing shareholder value."
Bin Salamah pointed out that there will be greater emphasis placed on data due to pent-up demand for such services, particularly in light of the growth in the usage of smartphones.
Commenting on Zain operations in Sudan and South Sudan, Bin Salamah revealed that Zain Group is currently facing challenges in the two countries, but hopes that the recent rapprochement between them will ultimately result in an improvement in the political and economic situation in both countries and may reflect positively in reducing the impact of such challenges.
Detailing developments within its operation in Saudi Arabia, Bin Salamah said: "Zain KSA is witnessing a radical shift given the successful completion of its rights issue, where the Group increased its stake in the company from 25% to 37%. Our faith and confidence in Zain KSA remains high, and we remain optimistic regarding the company's prospects in the future."
Bin Salamah went on to say: "Zain KSA's capital restructuring is going to be a major factor in boosting its operational and financial performance and its relationship with Zain Group will definitely become stronger resulting in more intense continued support for its new operational strategy."
Zain is a leading telecommunications operator across the Middle East and North Africa providing mobile voice and data services to over 41.4 million active customers as of June 30, 2012. With a commercial presence in 8 countries, Zain operates in the following countries: Bahrain, Iraq, Jordan, Kuwait, Saudi Arabia, Sudan and South Sudan. In Lebanon, the company manages 'touch' on behalf of the government. In Morocco, Zain has a 15.5% stake in Wana Telecom, now branded 'INWI', through a joint venture. Zain is listed on the Kuwait Stock Exchange (stock ticker: ZAIN). For more, please email firstname.lastname@example.org or visit
In Kuwait, Zain competes with Wataniya, a unit of Qatar Telecom, and Viva, an affiliate of Saudi Telecom Co. The operator's Iraq and Sudan units account for about two-thirds of its subscribers and 59 percent of revenue, according to its first-quarter results.
Zain has raised its stake in loss-making unit Zain Saudi, oversubscribing to the affiliate's 1.6 billion rights issue following a tepid response from other shareholders.
That raised Zain's stake in Saudi Arabia's No. 3 operator to 37 percent from 25 percent, marking a reversal in strategy for the Kuwait firm whose attempt to sell its entire holding failed last year.
Zain Sudan aims to add 1 million subscribers in 2012, but earnings gains will be offset by weaker operating margins due to higher taxes and a growing economic crisis, its chief executive told Reuters in June.
Last week, Zain told Reuters earlier it will not book an impairment in the third quarter for its key Sudan unit after the Sudanese pound was devalued by 40 percent in a move that cuts the dollar value of the subsidiary's earnings.
Shares in Zain, which has mobile licences in Kuwait, Saudi Arabia, Bahrain, Lebanon, Sudan, Iraq and Jordan, stood at 680 Kuwaiti fils on Monday.