Zain Group reports net profit of 14% for Q2 2023

Image credit: Zain Group

Zain Group, operating in seven markets across the Middle East and Africa, announced its consolidated financial results for Q2 and six months ended June 30, 2023.

The mobile voice and data services operator reported that it served 52.7 million customers at the end of the period, a two per cent increase year-on-year (YoY).

Zain Group financial KPIs of key markets

Kuwait

Maintaining its market leadership, the flagship operation of Zain Group saw its customer base grow 2 per cent YoY, to serve 2.6 million customers. The group’s most profitable operation, revenue remained stable at KD173m ($563m).

Data revenue represented 39 per cent of total revenue. Despite intense competition, the operator continues to expand and grow its leading nationwide 5G network capturing the largest 5G customer base and revenue market share in the country. Winning key corporate and government accounts through its B2B offerings, as well as the continual introduction of new digital services including Zain Max, a quad-play redefining a new generation of Internet and entertainment plans for postpaid customers, are key parts of the operator’s focus.

Saudi Arabia

Revenue grew 10 per cent YoY to reach $1.3bn while net income grew 220 per cent for the six-month period reaching $183 million. The operator’s 5G network covering over 50 cities saw data revenue represent 41 per cent of total revenue and customers served stood at 8.7 million.

Jordan

Revenue grew 4 per cent YoY to reach $261m with net income reaching $38m. The ongoing expansion of FTTH and 4G services across the country and soft launch of 5G in parts of the kingdom, helped data revenue grow 2 per cent representing 49 per cent of total revenue. Zain Jordan served 3.8 million customers (up 5 per cent YoY) maintaining its market leadership.

Bahrain

Revenue grew 11 per cent YoY reaching $98 million with net income reaching $7.3m, with data revenue growing 7 per cent to represent 45 per cent of total revenue.

Iraq

Revenue grew 17 per cent to reach $455m, with net profit jumping nearly eight-fold to reach $43m compared to $5m last year. The operator’s customer base reached 17.7 million customers maintaining its market-leading position.

Sudan

Despite the ongoing crisis, revenue soared 46 per cent to reach $303m, with net income for the period growing 23 per cent reaching $136m. Data revenue grew by 67 per cent representing 35 per cent of total revenue, customers base increased by 3 per cent to reach 16.9 million, maintaining its market leadership position.

Over the past six months, Zain said it had invested $178m in CAPEX (tangible and intangible) operations in Kuwait, KSA, and Bahrain which saw a growth in 5G revenues, and also conducted a soft launch of 5G in Jordan. It added that fintech services witnessed exponential growth as total revenue increased 294 per cent YoY, customers grew 73 per cent to reach 1.3 million, with transaction value doubling YoY.

Commenting on the H1 2023 results, Osamah Al Furaih, chairman of the Board of Directors of Zain Group, said, “This exceptional performance is a result of the Board and management’s focus on driving sustainable shareholder value through effective environmental, social and governance (ESG) practices, network upgrades expansion, and growing new lucrative business verticals with a focus on providing customers with an exceptional telecom experience.”

He added, “Our conducive relationships with the management of Omantel and government authorities across our markets are supporting us in our mission to reap the benefits of digital transformation as we drive systemic change and provide meaningful connectivity to the communities we serve and beyond.”

Telecommunications outlook

Zain, it is report noted that the establishment of Zain Omantel International will change the international telecommunications wholesale landscape. The operator said that it is in talks with TASC Towers Holding to enter into exclusive negotiations with Ooredoo to create a joint independent tower entity comprising of 30,000 telecom towers.

Bader Al-Kharafi, Zain vice-chairman and group CEO said, “The solid growth in enterprise, digital and fintech revenues combined with operational efficiencies across our markets was key to the impressive financial performance for the first half of 2023.”

“On the back of these robust results combined with our strong balance sheet and financial solvency, and in accordance with our declared 35 fils per share minimum dividend policy for the next three years starting 2023, the board is pleased to declare a third consecutive half-year dividend of 10 fils per share.”

“The sound performance of all our operations is a testament to our firm commitment and success in executing our ambitious ‘4Sight’ corporate strategy to drive growth through digital transformation and new lucrative business streams, as we methodically manage the continuing competitive and socio-economic challenges that several of our markets face.”