Feb 14 2012 |
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2ndUPDATE: Kuwait's Zain 4Q Net Pft -14% On Foreign Exchange Fluctuations
Tuesday, Feb 14, 2012
--4Q net profit -14% as foreign exchange losses mount
--Result broadly inline with analyst expectations
(Recasts, adds details, analyst comment.)
Of ZAWYA DOW JONES
DUBAI (Zawya Dow Jones)--Kuwait's Mobile Telecommunications Co., better known as Zain (ZAIN.KW), posted a 14% decline in fourth quarter net profit as losses on currency fluctuations continued to weigh.
The latest result was in bang line with the KWD75 million result penciled in by analysts at Bahrain's SICO, while analysts at Kuwait-based Global Investment House had forecast KWD70 million.
"The group was able to maintain growth levels in its main financial indicators, though profitability levels were severely affected because of the continuing volatility of the currency exchange rates in some of its main markets, which cost the group $124 million in 2011," Zain 's Chairman As'ad Ahmad Al-Banawan said Tuesday.
Zain didn't specify which markets were hit by the currency fluctuations last year, but in November Elfatih Erwa, Zain Sudan's chief executive told Zawya Dow Jones that 2012 will be a difficult year due a drop in the Sudanese pound.
Zain 's board of directors also recommended a cash dividend of KWD0.065 a share subject to annual general assembly and regulatory approvals.
Cairo-based investment bank EFG-Hermes said the proposed payout was "positive surprise" as it had expected a dividend of 41 fils a share.
"This implies a generous payout ratio of about 89% and a dividend yield of 7.4%, higher than the regional average yield of 6.0%," it said. "The attractive yield could trigger interest in buying the stock and we could see positive share price performance in the short term."
Zain said its customer base grew by 8% to 40.2 million subscribers across all its operations last year.
The telco's shares last traded 1.1% lower at KWD0.870.
-By Shereen El Gazzar, Dow Jones Newswires; +971 444 61684; Shereen.elgazzar@dowjones.com
Copyright (c) 2012 Dow Jones & Co.
(END) Dow Jones Newswires
14-02-12 0925GMT
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