Zain announces robust Q1, 2011 financial results as net income soars 40%
Zain announces its consolidated financial results for the quarter ended 31 March, 2011. The results showed robust growth in several key performance indicators. For the first quarter of 2011, the Zain Group recorded consolidated revenues of KD324.4m, reflecting a positive 1% increase on the same period in Q1-2010.
The period witnessed net income soaring to KD69.9m ($251.1m), an impressive 40% increase on the same period in Q1-2010. The company’s consolidated EBITDA reached KD147.7m ($529.7m) up 10% on Q1-2010, reflecting an EBITDA Margin of 46% (up 4%age points) with EBIT of KD105.9m ($379.9m), a 10% increase on Q1-2010. The earnings per share reached 18 fils ($0.06).
Q1, 2011 Operational Highlights:
• Zain Group completed a $1.3bn syndicated loan facility with a syndicate of international and regional banks to be utilized for general corporate purposes. The facility comprised of two parts, a 12-month term loan of $433.33m (KD120m) and a revolving credit facility of $866.67m (KD240m) with a maturity of 3 years;
• Successful closure of landmark IFC led $400m seven-year facility for Zain Iraq to fund network enhancement and expansion coupled with the successful launch of commercial services in country’s northern Kurdistan region. Zain Iraq now serves 12 million customers (up 14%) with a healthy 11% increase in revenues;
• Notable growth in Zain Sudan which now serves 10.65m customers (up 21%) and attaining a 13% revenue increase in local SDG currency;
• Exceptional HSPA+ launch in Jordan in early March sees over 41,000 broadband customers join within a month; encouraging launch of multi-functional ‘Zain E-mal’ mobile commerce service in the Kingdom;
• Management agreement of ‘mtc touch’ network in Lebanon renewed for another 12 months;
• Multitude of advanced technologies and services launched in Kuwait and Bahrain.
Commenting on the results, the Chairman of the Board of Directors of Zain, Mr Asaad Al Banwan, said, “These impressive results justify the many prudent decisions recently adopted by the Board and the executive management. The company has reengineered itself, focusing on maximising shareholders’ value while at the same time providing customers with a wonderful mobile experience. The impressive 40% net income growth and earnings per share of 18 fils, coupled with customer growth of 20%, indicates we on the right track.”
Mr Al Banwan also noted that despite intense competition on various levels across all the markets and adverse currency fluctuations, it was pleasing that the company maintained relatively stable revenue levels overall. He pointed out that the net profit for the quarter was adversely affected by currency fluctuations of an amount of $84m, which was partially offset by an adjustment and reversal of provisions related to executive management entitlements during the quarter.
The Chairman also revealed that the quarter witnessed an increase in total shareholders’ equity of approximately 12%, reaching KD2.695bn ($9.748bn), compared with KD2.514bn ($8.72bn) at the end of the first quarter of 2010.
Zain Group CEO, Mr Nabeel Bin Salamah, said, “The operational efficiency drive implemented over the past 12 months has resulted in healthy growth of several key indicators. Additionally we are reaping the rewards of our extensive investments in network technology upgrades across all our country operations, and we expect such progress to continue for the foreseeable future.”
Mr Bin Salamah concluded that the company is seeking to further increase market leadership in the markets Zain serves, by delivering customers the latest innovative technologies and quality mobile services.