Zain Saudi Arabia, a subsidiary of Kuwait-based telco Zain Group, has reported gross profit of SAR3.223 billion (USD858 million) in the twelve months to end-December 2014, a 2.81% annual increase on the SAR3.135 billion reported in 2013. The operator attributed the positive result to ‘the rising demand for internet services, the decline in repair and maintenance expenses and the adjustment of the useful life of some of the company’s assets’. Zain Saudi incurred net losses of SAR1.270 billion during the period under review, a figure which represents a 23.08% annual improvement on the SAR1.651billion loss reported for 2013. Earnings before interest, taxation, depreciation and amortisation (EBITDA) for the twelve-month period also increased, by SAR210 million (or 24.0% year-on-year), to SAR1.100 billion.
The company disclosed that its performance in 2014 fell short of its approved business plan and that it was also below one of its loan covenants; Zain Saudi stated, however, that it has secured a waiver for the breach and has agreed to revise covenant calculations for 31 December 2014 and 31 March 2015. In addition, the management has approved a revised business plan on 20 January 2015, subject to final approval.
In operational terms, Zain Saudi reported that its internet service subscribers increased by 147% in the twelve months under review, while internet data traffic also increased, by 621% year-on-year.