- Quarter highlighted by revenues increasing 8%
- Net losses narrowed by 54% in Q4
- The High Order awarding of a 15-year license extension and unified license is set to support Company's growth strategy
RIYADH, Saudi Arabia, Jan. 19, 2017 /CNW/ - Mobile Telecommunication Company Saudi Arabia (Zain Saudi Arabia) announced its financial results for the fourth quarter ending December 31, 2016.
Key Performance Indicators for the fourth quarter (Q4) of 2016:
Compared to Q4, 2015, Zain Saudi Arabia reported:
- Revenues of SAR 1,801 million, up 8%
- Gross profit of SAR 1,142 million, up 7%
- EBITDA increased by 21% YoY, reaching SAR 490 million
- Net losses by 54% to reach SAR 135 million
Key Performance Indicators for the 12 months ending 31 Dec 2016:
Compared to Full-Year 2015, Zain Saudi Arabia reported:
- Revenues increased by 3% to SAR 6,927 million,
- Gross profit grew by 11% to SAR 4,401 million.
- EBITDA also grew by 10% to a level of SAR 1,795 million
- Steady net losses up by 1% to SAR 980 million
Zain Saudi Arabia reported an 8% increase in revenues to reach SAR 1,801 million in Q4 2016, up from SAR 1,672 million a year earlier. Revenues for the twelve-months of 2016 grew by 3% reaching SAR 6,927 million, up from SAR 6,741 million for the same period in 2015.
Gross profits for Q4 2016 reached SAR 1,142 million, up 7% compared to SAR 1,065 million in Q4 2015, and up 8% compared to SAR 1,061 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 SAR 4,401 million increasing by 11% up from SAR 3,951 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 SAR 490 million, up from SAR 405 million during the same quarter of 2015. EBITDA for the 12 months of 2016 amounted to a record SAR 1,795 million, up 10% on SAR 1,629 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 SAR 87 million during Q4 2016, up from a loss of SAR 82 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 SAR 135 million, down from SAR 291 million during Q4, 2015, and by 49% compared to SAR 267 million in Q3 2016 reflecting the lowest net loss since inception. Net losses for the twelve-month period increased by 1% in 2016, reaching SAR 980 million, up from SAR 972 million a year earlier.
The fourth quarter also marked the end of the arbitration process between Zain and Mobily, with the final judgement of the arbitration panel being fully provided in the accounts.
Commenting on the results, HH 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 SAR108 million during the quarter."
HH 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."
Mr. 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 Mr. Kaliaropoulos.
Commenting on the High Order to extend the Company's license and grant it a unified license, Mr. 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." concluded Mr. Kaliaropoulos.
SOURCE Zain Saudi Arabia