Zain announces robust Q1 financial results

West Asia's leading telecommunications operator Zain has announced its consolidated financial results for the quarter ended March 31, showing robust growth in several key performance indicators.

The Kuwait-headquartered company said for the first quarter of 2011, the Zain Group recorded consolidated revenues of $1.163 billion (KWD 324.4 million), reflecting a positive 1% increase vis-a-vis the same period in Q1 of 2010.

The period witnessed net income soaring to $251.1 million (KWD 69.9 million), a 40% increase over the same period in Q1 of 2010.

The company's consolidated EBITDA reached $529.7 million (KWD 147.7 million) up 10% on Q1 of 2010, reflecting an EBITDA margin of 46% (up 4 percentage points) with EBIT of $379.9 million (KWD 105.9 million), a 10% increase vis-a-vis Q1 of 2010.

The earnings per share reached 19 fils ($0.06). During the quarter, Zain Group completed a $1.3 billion syndicated loan facility with a syndicate of international and regional banks to be utilised for general corporate purposes.

The facility comprised two parts, a 12-month term loan of $433.33 million (KD 120 million) and a revolving credit facility of $866.67 million (KD 240 million) with a maturity of three years.

Commenting on the results, the chairman of the board of directors of Zain, Asaad Al Banwan, said: "The impressive 40% net income growth and earnings per share of 19 fils, coupled with customer growth of 20%, indicates we are on the right track."

Al Banwan said despite intense competition on various levels across all the markets and adverse currency fluctuations, it was pleasing that the company maintained relatively stable revenue levels overall.

He pointed out that net profit for the quarter was adversely affected by currency fluctuations of an amount of $84 million, which was partially offset by an adjustment and reversal of provisions related to executive management entitlements during the quarter.