MEA operator group Zain announced a drop in third-quarter profit, as currency issues took their toll on the bottom line.
The company reported a profit for the period of KWD46 million ($163 million), a 13 per cent year-on-year decrease, on revenue of KWD294 million, down 6 per cent. But excluding the impact of currency variations, net profit would have increased by 3.9 per cent.
The currency impact mainly related to its operations in Sudan, with Iraq also impacted to a lesser degree.
Zain said that its managed active customer base decreased by 1 per cent, to 43.7 million. The company noted that a change of definition of ‘active customers’ by the regulator in Iraq saw its customer base in the country decrease to 13.3 million from 14.5 million.
As mandated by its operating licence, Zain also completed an IPO of 15 per cent of its operation in Bahrain, with trading on the country’s bourse expected to begin this month.
For the nine months, net income was down 2 per cent to KD161 million, on revenue which was “stable” at KWD921 million. Net income increased by 7.5 per cent excluding the currency impact.
In a statement, Zain noted “exceptional circumstances” in Iraq, “considering the escalation of social instability in recent months that has seen several million people displaced internally coupled with Zain Iraq enduring frequent temporary network shutdowns and associated higher network operational costs”.
Regardless, it also stated readiness to launch 3G services “as soon as the licence is acquired”.
For its “flagship operation” in Kuwait, the company said its 4G network is “truly differentiating the mobile operator from its peers”. Data revenue now represents 31 per cent of its total.
Asaad Al Banwan (pictured), chairman of Zain Group, said: “As a market leader in six of our eight operations, the Board remains focused on further strengthening our dominant presence in our home market of Kuwait while at the same time investing in network upgrades and enhancing our positions across all our other markets.”
Last month Zain CEO Scott Gegenheimer told the GSMA’s Mobile 360 event in Dubai that the operator group is also planning to diversify into the enterprise and M2M markets, as it prepares to make Jordan the fifth market in which it offers LTE.