“Zain KSA” made solid progress during the year 2013 with revenue growth of 6% reaching SAR 6,523 million up from SAR 6,171 million in 2012. Subscriber numbers have also increased by 10% reaching 8.7 million, up from 7.9 million the previous year. Main drivers of this increase in revenues were increase in the internet segment revenues, alongside revenues increase in the postpaid segment. The internet service traffic on the MBB network has also increased by 108% during full year 2013 as compared to 2012.

Gross profit recorded double digit growth of 10%, increasing from SAR 2.9 billion in 2012 to SAR 3.1 billion at year-end 2013, leading to a gross profit margin of 48% for the year, up from 46% at year-end 2012. The company has also succeeded in reducing general and administrative expenses by 27% year on year.

Net loss narrowed further from SAR 1.7 billion for FY 2012 to SAR 1.6 billion at year end 2013 due to topline growth, financial restructuring, operational efficiency improvements and costs controls during the year.

As for EBITDA, an improvement by 2% has been recorded during 2013 reaching to SAR 891 million up from SAR 878 million in 2012. The Company maintained stability of its EBITDA Margin at 14%.

Financial charges has significantly decreased by 12% (equivalent to SAR 100 million) during 2013 reaching to SAR 723 million down from SAR 823 million in 2012, such decrease is attributable basically to capitalizing majority of advances from shareholders as part of capital restructuring  back in 2012, which accordingly minimized the commission related to it. Moreover, financial charges related to Murabaha Facility decreased as a result of lowering the carrying Murabaha Profit took place during July 2013.

On another note, Loss from operations increased by around 2% in 2013 reaching to SAR 949 million up from SAR 932 million in 2012. This is attributable to the increased maintenance costs under the distribution and marketing costs, which is a result of the increased number of network sites. cost of revenues have also increased in 2013 by 2% reaching to SAR 3,388 million up from SAR 3,311 million in 2012. This increase in cost of revenues is attributable mainly to an increase in the international interconnection cost related to number of international destinations.

Commenting on the FY 2013 results, Fahd bin Ibrahim Al-Deghaither, Chairman of the Board of Directors of Zain KSA, said:
“2013 has been a stepping stone in the evolution of Zain KSA. We have made good progress in improving our capital structure by successfully refinancing the Murabaha Facility Arrangement to a lower interest and longer term tenure. In addition, we entered into an agreement with the Ministry of Finance to defer royalty fees payable to the government for seven years.

 “During 2013, we increased our customer base by 10% to a total of 8.7 million customers, partly due to the solid progress made in the mobile broadband (MBB) segment.

Hassan Kabbani, Chief Executive Officer, Zain KSA said:
“Zain KSA goals are to boost market share and continue capturing MBB market opportunities in which MBB data traffic significantly increased by 108% during the year 2013 as compared to 2012.

In 2013, we maintained stable revenues, lowered net loss and increased efficiencies. We now have a solid base for entering the next phase of growth for Zain KSA, we implemented a strategic program, aimed at enhancing our services, focusing on the strength of our network and achieving our commercial and financial goals.

 “In a competitive telecom market, we are proud to offer customers a fast and reliable network, and we are confident Zain KSA is well positioned to take advantage of the current market opportunities and achieve sustainable and profitable growth in the future.”