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ZAIN Saudi Arabia reported an 8% increase in revenues to reach SR1,801 million in Q4 2016, up from SR1,672 million a year earlier. Revenues for the twelve-months of 2016 grew by 3% reaching SR6,927 million, up from SR6,741 million for the same period in 2015.
Gross profits for Q4 2016 reached SR1,142 million, up 7% compared to SR1,065 million in Q4 2015, and up 8% compared to SR1,061 million in Q3 2016. The company reported steady gross margin at 63% compared to 64% during Q4 2015, whilst gross profits during the twelve-month period reached a record SR4,401 million increasing by 11% up from SR3,951 million during the same period of last year, with gross margin of 64% improved compared to 59% the previous 12 months’ period.
The company reported a significant 21% increase in EBITDA in Q4, 2016 to reach a record SR490 million, up from SR405 million during the same quarter of 2015. EBITDA for the 12 months of 2016 amounted to a record SR1,795 million, up 10% on SR1,629 million recorded in the same period of 2015.
EBITDA margin rose in Q4 2016 to 27% compared to 24% in Q4 2015, while reaching 26% for the twelve months of 2016 compared to 24% in 2015.
The company recorded an operating profit of SR87 million during Q4 2016, up from a loss of SR82 million in the same quarter in 2015, Q4 2016 includes the incorporation of the relevant amortization savings associated with the 15-year license extension.
Net losses for Q4 2016 were narrowed by 54% to SR135 million, down from SR291 million during Q4, 2015, and by 49% compared to SR267 million in Q3 2016 reflecting the lowest net loss since inception. Net losses for the twelve-month period increased by 1% in 2016, reaching SR980 million, up from SR972 million a year earlier.
The fourth quarter also marked the end of the arbitration process between Zain and Mobily, with the final judgment of the arbitration panel being fully provided in the accounts.
Commenting on the results, Prince Naif Bin Sultan Bin Mohammed Bin Saud Al Kabeer, Chairman of the Board of Directors of Zain Saudi Arabia, said “Q4 2016 marked the most significant development for the Company since inception, following the High Order announced on October 1st, to extend the company’s license by 15 years and upgrade it to a unified license. The extension of the license decreased the amortization charge by SR108 million during the quarter.”
He added “I would like to thank the Custodian of the Two Holy Mosques and the Government for this decision which, in line with Vision 2030, will enhance the competitiveness of the sector and enable it to play an important role in the development of the economy.”
Peter Kaliaropoulos, Chief Executive Officer of Zain Saudi Arabia, said “despite increased competition and challenging conditions in the Kingdom’s telecom sector, Zain delivered healthy revenue growth and better margins for the quarter and year-on-year.”
“The important and necessary biometric identification requirement which Zain is fully committed to, whilst adversely affecting the total customer base of all industry operators, it also provided the opportunity to gain new, first time to Zain, customers. We will continue to deliver better value and quality to consumers and businesses through ongoing investment in our network and innovative voice and broadband offers,” added Kaliaropoulos.
Commenting on the High Order to extend the company’s license and grant it a unified license, Kaliaropoulos said “the company’s net losses have decreased significantly due, in part, to the impact of the extension of our license and growth in revenues. The upgrade of the license to a unified license will enable the company to introduce a wider range of telecommunications services, including fixed services, leveraging Zain’s network and that of new partners. Customers across all sectors will increasingly have more choice for broadband services to the home and communications solutions for their business.”
“The efforts of the entire Zain team in Saudi Arabia, and the continued support from the Board of Directors, our shareholders and Zain Group, are sincerely appreciated. We will continue to face very tough market challenges in 2017 and we need to remain clearly focused and continually improve all aspects of our operations,” Kaliaropoulos noted.
© The Saudi Gazette 2017
