Kuwait's Zain Q2 net profit falls 33%

30/07/2015 05:41 AST

KUWAIT — Zain, Kuwait's biggest telecom operator by subscribers, reported a 33 percent fall in second-quarter profit on Wednesday, extending a sustained earnings slump as difficulties in Iraq and a strong dollar hurt earnings.

The company, which operates in eight countries in the Middle East and Africa, made a net profit of 39.2 million dinars ($128.8 million) in the three months to June 30, it said in a statement.

This compares with a profit of 58.8 million dinars in the year-earlier period, previous financial statements show.

Zain had posted falling profits in nine of the 11 preceding quarters as tougher domestic competition, service interruptions and higher costs in war-torn Iraq and foreign exchange volatility in some markets weighed on the bottom line.

Zain said currency losses, mainly due to a strong dollar, had trimmed its half-year profit – which fell 30 percent year-on-year to 80 million dinars – by $13 million.

Zain Iraq, which listed on Baghdad's bourse in June, made a net profit of $60 million on revenue of $604 million in the first half. This compares with profit and revenue of $165 million and $856 million respectively a year earlier.

Domestically, Zain's half-year revenue was $544 million and net income $166 million, both down 16 percent according to Reuters calculations.

Last month affiliate Zain Saudi, in which Zain owns a minority stake, reported a narrowing quarterly loss, while the parent firm's Sudan unit appears to have overcome longstanding currency-related troubles, posting a 31 percent rise in half-year net income to $78 million.

Saudi Gazette