For the first half of 2010, the Zain Group recorded consolidated revenues of KWD672.6 million ($2.33 billion), an increase of 10 percent compared to the same period of 2009. Consolidated EBITDA reached KWD287.2million ($995 million) with EBIT reaching KWD206.8 million ($716 million), the company said in a statement released Friday. Net income soared 488 percent to reach KWD895.3 million ($3.085 billion). This includes the capital gain of KWD770.3 million ($2.653 billion) from the sale of Zain Africa assets on June 8, 2010. The earnings per share reached 232 fils ($0.80). With the conclusion of the sale of Zain Africa last June 8, the company received cash proceeds of $7.868 billion, of which proportionate capital gain profit is reflected in the H1 2010 net income results. “Despite the challenging global economic conditions and the competitive markets in which we operate, we are extremely pleased with the 10 percent revenue increase which is in line with our expectations as well as the record profit that is the largest in the company's history,” said Asaad Al Banwan, chairman of the Board of Directors of Zain. “With the sale of the Zain Africa assets now concluded, coupled with a healthy cash balance and reduced debt levels, the company is now well positioned to focus on, and further grow, its profitable Middle East operations. Better things are yet to come as we diligently strive to maximise shareholders' value in this new era.” He added that “the H1 2010 net income (excluding the capital gain) and EBITDA results is all the more impressive when one takes into account that in the same period last year (H1-2009), where we had several reversals of provisions, including a favorable ruling resulting in an extraordinary net income gain of KWD63 million ($218 million) and EBITDA gain of KWD44.8 million ($155 million). This is an indication that EBITDA and net income growth for the first half of 2010 would have been much higher than stated, as without such provision reversals, the company would have had a respective growth of 7 percent in EBITDA and 41 percent in net income.” The half-year period witnessed an increase in total shareholders' equity of approximately 16.6 percent, reaching $8.9 billion, compared with $7.7 billion at the end of the first half of 2009. Zain Group CEO Nabeel Bin Salamah said: “The company has reengineering itself with a new and dynamic management team both at group and in several country operations. We are focused on further increasing our market leadership in all our Middle East operations, offering customers the latest technologies and quality mobile services. We are now in the flexible position of being able to consider all our options.” He added that the impressive performance of several key markets is an indication that better financial results are expected in the near future. “With our Saudi Arabia operation achieving breakeven EBITDA and 7 million customers in only 22 months of operation, coupled with the impressive customer and revenue growth in our Sudan and Iraq operations, and Kuwait maintaining its market share despite the entry of a third operator, we are confident these impressive results will continue.” In recent years, Zain has invested heavily in network expansion in the region, especially in vast countries such as Iraq, Jordan, Saudi Arabia and Sudan, as well as technology upgrades in Bahrain and Kuwait. “These have all been translated into robust customer acquisition and healthy revenues,” said Bin Salamah. “We expect to reap further financial rewards of these strategic and capital intensive investments in the years ahead,” he concluded. Most recently in June 2010, Zain Jordan acquired a 15-year license for $70.4 million to establish and operate HSPA+ and LTE technology (3G) that is expected to be commercially launched in the first quarter of 2011.
