Kuwait's Zain reports 8% rise in Q1 net profit
Iraq, domestic business contribute to welcome recovery
Kuwait’s Zain Group posted an 8% jump in first-quarter profit yesterday, surpassing analysts’ forecasts, following a stabilisation of Sudan’s currency and increased earnings in Iraq and at home, according to a report from Reuters.
The company reported net profit of KWD55.9m ($198.5m) in the first quarter. While no dinar figure was available for the year-earlier period, Reuters reported that previous financial statements showed a profit of KWD52m in Q1 2013. Two separate analysts had forecast profit figures of KWD50m and KWD53.3m.
Zain Group had watched profits fall in five of the past six quarters due to stiffening domestic competition and a sustained drop in the Sudanese pound. After a devaluation against the dollar in November last year, the pound stabilised.
Chief executive Scott Gegenheimer cited Zain's "huge investment" in network upgrades as reason for the rise in earnings.
Also instrumental in the posted figures was Zain’s Iraq operation, which accounts for 35% of subscribers and 40% of revenue. The opco's net profit rose by almost a quarter to $78.3m.
At home, quarterly profit rose 8% to $98m. Data accounted for 31% of domestic revenue, which grew 9% to $313.2m.
Zain, a former monopoly, is Kuwait’s top operator by subscriber base and competes domestically with Wataniya, an operation of Qatar's Ooredoo, and Viva, controlled by Saudi Telecom Co. It also operates in eight territories across the MEA region.