Zain Group reported a consolidated net profit of $3.675 billion for 2010, the highest ever in Zain’s history and a record in the private sector of Kuwait.
In 2010 Zain Group recorded impressive consolidated revenues of $ 4.72 billion, an increase of 7% compared to the 12 months of 2009. The company’s consolidated EBITDA increased by 6% for the same period to reach $ 2.15 billion reflecting an EBITDA margin of 46%, with EBIT rising 4% to reach $1.57 billion.
Consolidated Net Income reached $3.675 billion), an increase of 445%, that is inclusive of the capital gain of $ 2.653 billion from the sale of Zain Africa assets on June 8, 2010. If the capital gain from the Africa Assets sale is not taken in account, net income reached $1.022 billion for the year, representing a notable 50% increase on 2009 net income of $675 million.
The earnings per share for the 12 months of 2010, stood at $ 0.95, compared to $0.18 in the previous year. Additionally, the period witnessed shareholder equity increase 11% to reach $9.77 billion.
With such impressive earnings, the Board of Directors has recommended a cash dividend of $0.72 that is subject to the necessary approvals at the annual general assembly.
Year-on-year customer growth across all the Middle East countries in which Zain operates was 23%, whereby the company is serving 37.24 million managed active customers as of December 31, 2010. Zain Group added seven million new active customers over the past twelve months.
“The year 2010 was both a crucial and record year for the company as it represented a turning point in the Group’s operational and strategic plans. It witnessed a series of decisions that led to the sale of the Group’s 15 African mobile operations, reaping the fruits of the Group’s investments on the continent and accomplishing the desired results of Zain’s successful expansion strategy embarked on back in 2003,” said Asaad Al-Banwan, Chairman of the board of directors of Zain.
“This decision of divesting the African assets has helped the Group settle its financial obligations and invest a large part of the financial gains in its main and cash generative Middle East markets where the focus will be going forward. It also highlights the significant value and wealth creation that has been provided to shareholders by the Group actions. Our priority is first and foremost the interests of shareholders when making any decision,” he added.
“Zain is the largest operator in the region with over 37 million customers and a market leader by customers in five of its seven Middle East operations. With a healthy cash balance and reduced debt levels, the company is now well-positioned to focus on, further invest in and grow its profitable Middle East operations. We will strive to increase our market leadership by offering customers the latest technologies and quality mobile services, ensuring a wonderful mobile experience,” said Zain Group CEO Nabeel Bin Salamah.
Bin Salamah said that during the past two years the Group has invested more than $1.4 billion to develop and improve the operational efficiency and quality of its network across all its Middle East operations. “This will provide a strong base for future growth so that Zain can be at the forefront of mobile technology in most of the markets it serves where,” he said.
He said that the company has reengineered itself and implemented a range of initiatives over the past year at both Group and country levels to increase operational efficiency and increase margins on many key indicators.
“To realize our business aspirations, we have devised an integrated strategy that will hopefully aid us, through organic growth, to reach 52 million customers, generate 6.3 billion in revenues, increase the EBITDA to $3.4 billion – while improving the EBITDA margin to 53% – and more than double our net profit to $2.1 billion by 2014,” he added.