Al-Kharafi: Zain Saudi Arabia continues to record net profit for three consecutive quarters
KUWAIT: Zain Saudi Arabia (Zain KSA), announces impressive financial results for all key indicators for the first quarter ended 31 March, 2019.
For the first quarter of 2019, Zain KSA recorded revenues of SAR 2.1 billion ($558 million), a 24 percent increase to the same period in 2018. EBITDA for the quarter reached SAR 955 million ($255 million), up 67 percent from SAR 571 million ($152 million) a year earlier. The operator’s EBITDA margin for Q1 2019 stood at 46 percent. EBIT also improved to reach SAR 382 million for Q1 2019 compared to SAR 143 million for the same period a year earlier, reflecting a 167 percent increase.
Net income for Q1 2019 reached a healthy SAR 129 million ($34 million), a marked improvement on the loss of SAR 77 million ($21 million) recorded for Q1 2018.
Key Operational and Financial notes for three months ended 31 March, 2019:
- The Zain KSA board of directors signed an agreement to sell and lease back the passive physical infrastructure of the company’s mobile tower portfolio to IHS Holding Limited (IHS) for a revised amount of circa SAR 2.52 billion ($672 million)
- Zain KSA successfully obtained new frequencies in the 3.5 GHz band, which is one of the key bands used globally to provide 5G wireless services
- Zain KSA acquired 2600 MHz spectrum, following an auction held by the Communications and Information Technology Commission (CITC). By expanding its range of available frequencies, Zain KSA is expected to offer even more state-of-the-art mobile telecommunications services using 4G and 5G technologies. Following this acquisition, Zain KSA has expanded its current spectrum frequencies roster to include 800MHz, 900MHz, 1800MHz, 2100MHz, and 2600MHz
- Profitability positively impacted by decrease the in CITC royalty fees from 15 percent to 10 percent and from the release of certain provisions from the settlement signed with various ministries of the Kingdom (MOF, MCIT and CITC)
Commenting on the results, Bader Al-Kharafi, Zain Vice Chairman and Group CEO; & Zain KSA Vice-Chairman, said “Despite the fierce competition present in the Saudi telecom market, the operation’s ongoing transformation has resulted in Zain KSA recording net profit for three consecutive quarters with revenue growing quarter-on-quarter.”
Al-Kharafi added, “This positive growth is a real translation of the performance and hard work of both the Zain KSA and Group team efforts in leveraging the operator’s network investment in advanced technologies and upgrades, prudent cost optimization and operational efficiencies, ongoing focus on the growth of data services, higher value customers and B2B acquisitions, combined with dedicated customer care efforts.”
Furthermore, Al-Kharafi highlighted that the company is working on a package of qualitative initiatives aimed at further developing Saudi nationals, increasing the efficiency of the quality of the company’s services, in addition to concluding important agreements with major global technology companies to improve and develop the 5G ecosystem.
Zain KSA has recently signed several important agreements aimed at improving the quality of services. The most prominent of these agreements include with Nokia, Alibaba Cloud, Huawei, Saudi Telecom Company (STC), DETASAD and other significant agreements of strategic importance.
Al-Kharafi concluded by expressing his sincere gratitude to the leadership of Saudi Arabia for creating an environment in which companies can thrive, stating, “Zain is committed to playing a key role in the Kingdom’s ICT sector and offer customers quality and life empowering telecommunication services in line with Vision 2030.”