JEDDAH – Kuwait-based telecoms giant Zain Group has announced its consolidated financial results for the 12 months ended Dec. 31, 2013, reporting a 3.9 percent annual decline in revenues to KWD1.24 billion ($4.4 billion), down from KWD4.58 billion reported in 2012. Data revenues displayed healthy growth of 25 percent, due to increased investment in 3G and Long Term Evolution (LTE) technology upgrades. In the period under review, EBITDA reached KWD538.0 million, while the company booked a net profit of KWD216.4 million in 2013, a 14.1 percent decrease on the KWD252.1 million reported 12 months earlier. Asaad Al Banwan, chairman of the board of directors of Zain Group, said “the company's overall 12-month financial results were substantially affected by currency translation impact, effectively slashing revenues by $419 million and EBITDA by $181 million. Without the effects of this currency translation impact, the company's consolidated revenues would have grown 5 percent year-on-year with EBITDA growth of 2 percent. With regard to net income, if not due to both a foreign currency translation impact of $92 million and an exceptional increase of $57 million loss from ‘foreign currency revaluation' for the 12-month period, net income would have grown by 1 percent.” In operational terms, Zain Group reported 8 percent growth in its consolidated customer base, which reached 46.1 million on Dec. 31, 2013, equivalent to over three million net additions in the 12 months under review. In Kuwait, subscribers increased by 12 percent y-o-y, to 2.5 million, while Bahrain reported 25 percent growth in its customer base over the same period. Iraq saw its customer base grow by 16 percent to 15.9 million, as the local unit's networks expanded to cover Northern Iraq. Meanwhile, Saudi Arabia contributed 8.5 million users to the total subscriber base, equivalent to 13 percent annual growth. Elsewhere, Sudan reported a total of 11.7 million users, while customers in South Sudan increased by 22 percent to reach 812,000. Further, Touch's Lebanese subscriber base increased by 5 percent to reach two million, while Zain secured another extension to its management contract in the country, renewable on 31 March 2014. Zain Group CEO Scott Gegenheimer noted: “We have undertaken many transformational initiatives to drive operational efficiency and innovation across our operations which continue to perform well in local currency terms. Although our quarter-to-quarter results are positive, it is disappointing to report declining financial results for the full year considering the sound operational progress achieved during 2013. Factors outside of Zain's control such as exceptional local currency devaluation in one key market, together with social instability in others continue to adversely affect our financial results. However, we are not discouraged by these set of circumstances and firmly believe that we are implementing the correct strategy for the company's future growth.” — SG
