Zain’s profit rises 8% on gains in Iraq, at home

22/04/2014 07:32 AST

Zain, Kuwait’s top telecoms operator by subscribers, reported an 8 per cent rise in first quarter profit on Monday, beating analysts’ estimates as earnings from Iraq and its domestic business rose and Sudan’s currency stabilised.

The former monopoly, which operates in eight countries in the Middle East and Africa, posted a net profit of 55.9 million dinars ($198.5 million) in the three months to March 31.

It did not provide a year-earlier figure in dinars, but its previous financial statements show it made a profit of 52 million dinars in the first three months of 2013.

Two analysts polled by Reuters had forecast profit figures of 50 million dinars and 53.3 million dinars.

The firm had posted falling profits in five of the preceding six quarters as tougher competition at home and the plunging value of Sudan’s pound weighed on the bottom line.

The currency has been steady this year after Sudan devalued it against the dollar by nearly a quarter last November. It has had less of an impact on Zain’s earnings this year, the company said.

First-quarter revenue was 311 million dinars, up 4 per cent from the year-earlier period. Data revenue rose 27 per cent to reach 15 per cent of the total.

Chief Executive Scott Gegenheimer said in a company statement that the rise vindicated Zain’s “huge investment” in upgrading its networks.

Zain’s Iraqi operation is its most important, accounting for 35 per cent of customers and 40 per cent of revenue. The unit’s net profit rose by almost a quarter to $78.3 million.

The Gulf Today