Zain Saudi Arabia, a subsidiary of Kuwait’s Zain Group, has published the company’s consolidated financial results for the three months ending 30 June 2013 on the Saudi Stock Exchange’s (Tadawul’s) website, with a 17.54% increase in gross profit to SAR831 million (USD221.58 million), up from SAR707 million in 2Q12. The company reported a net loss of SAR370 million, a 6.09% improvement on the SAR394 million generated in the year-ago period, partly explained by 23% reduction in the financing costs to SAR345 million, compared to SAR449 million during the same period of 2012. Further, revenues increased by 9% year-on-year to reach SAR1.71 billion by end-June 2013, up from SAR1.57 billion reported in 2Q12. The company attributed the increase in turnover to a surge in the overall number of subscribers.
As previously reported by TeleGeography’s CommsUpdate, in June 2013 Zain Saudi reached an agreement with the Saudi Ministry of Finance to defer the payment of licence-related levies, estimated at SAR56 billion over a seven-year period. The chairman of the Board of directors of Zain Saudi Fahd bin Ibrahim Al-Deghaither said that the agreement would contribute to a provision of greater liquidity and would be used to reduce a portion of the company’s liabilities. The cash-strapped cellco also extended the repayment period of a SAR9 billion facility until 31 July 2013, after the company managed to secure a SAR2.25 billion three-year borrowing facility, guaranteed by Zain Group. The loan was provided by four banks, including Arab National Bank, Banque Saudi Fransi, Gulf International Bank BSC and Samba Financial Group, and was used to help refinance its SAR9 billion Islamic loan.