Mobile Telecommunication Company Saudi Arabia (Zain KSA) announces its Interim Financial Results for the Period Ending on 2020-06-30 (Six Months)
Tuesday 14 July 2020
| ELEMENT LIST | CURRENT QUARTER | SIMILAR QUARTER FOR PREVIOUS YEAR | %CHANGE | PREVIOUS QUARTER | % CHANGE |
| Sales/Revenue | 1,889 | 2,057 | -8.167 | 2,039 | -7.356 |
| Gross Profit (Loss) | 1,355 | 1,524 | -11.089 | 1,473 | -8.01 |
| Operational Profit (Loss) | 297 | 374 | -20.588 | 357 | -16.806 |
| Net Profit (Loss) after Zakat and Tax | 59 | 130 | -54.615 | 105 | -43.809 |
| Total Comprehensive Income | 48 | 85 | -43.529 | 38 | 26.315 |
All figures are in (Millions) Saudi Arabia, Riyals
| ELEMENT LIST | CURRENT PERIOD | SIMILAR PERIOD FOR PREVIOUS YEAR | %CHANGE |
| Sales/Revenue | 3,928 | 4,150 | -5.349 |
| Gross Profit (Loss) | 2,828 | 3,004 | -5.858 |
| Operational Profit (Loss) | 653 | 756 | -13.624 |
| Net Profit (Loss) after Zakat and Tax | 164 | 260 | -36.923 |
| Total Comprehensive Income | 86 | 148 | -41.891 |
| Total Share Holders Equity (after Deducting Minority Equity) | 4,189 | 3,867 | 8.326 |
| Profit (Loss) per Share | 0.281 | 0.445 |
All figures are in (Millions) Saudi Arabia, Riyals
| ACCUMULATED LOSSES | CAPITAL | PERCENTAGE % |
| 1,444 | 5,837 | 24.7 |
All figures are in (Millions) Saudi Arabia, Riyals
| ELEMENT LIST | EXPLANATION |
| Increase (Decrease) in Net Profit for Current Quarter Compared to the Same Quarter of the Previous Year is Attributed to | Zain KSA continues to record net profit for eight quarters in a row despite the outbreak of Covid-19. The company reported net profit of SAR 59 million in Q2 2020 with a decrease of SAR 71 million compared to Q2 2019 due to the decrease in revenue by SAR 168 million. The estimated impact from covid-19 outbreak in Q2 potential revenue is SAR 186 million mainly from the drop in prepaid, postpaid, devices, and visitor packages and the halt of the Umra season. This has been partially absorbed by SAR 125 million decrease in Opex as a result of better cost management to limit the impact of the pandemic. Depreciation and amortization increased by SAR 34 million as a result of the capex investment. Finance cost decreased by SAR 14 million due to the decrease in Sibor and Libor and as well to better cash management. The release of certain provision increased, in this quarter, by 35 million compared to Q2 2019. |
| Increase (Decrease) in Net Profit for Current Quarter Compared to the Previous Quarter is Attributed to | The company reported net profit of SAR 59 million in Q2 2020 with a decrease of SAR 46 million compared to Q1 2020 due to the decrease in revenue by SAR 150 million, mainly from the drop in prepaid, postpaid, devices, and visitor packages and the halt of the Umra season. This decrease in revenue has been compensated by a decrease in cost of revenue by SAR 31 million; as well as a decrease in Opex by SAR 99 million as a result of better cost management, also finance cost decreased by SAR 17 million. However, depreciation and amortization increased by SAR 22 million. |
| Increase (Decrease) in Net Profit for Current Period Compared to the Similar Period of the Previous Year is Attributed to | The revenue decreased by SAR 222 million in this period compared to the same period of last year. This decrease in revenue was partially compensated by a decrease in cost of revenue by SAR 46 million and Opex SAR 120 million. In addition, finance cost decreased by SAR 19 million. Depreciation and amortization increased by SAR 43 million. All the above have led to a net profit of SAR 164 million in H1 2020. |
| Basis of the External Auditor's Opinion | Unmodified opinion |
| Reclassification of Comparison Items | Certain comparatives figures have been reclassified to conform with the presentation in the current period. |
| Additional Information | The accumulated deficit decreased to reach SAR 1,444 million as at 30-06-2020, representing 24.7% of the company’s share capital of SAR 5,837 million. This is an improvement when compared to the accumulated deficit of SAR 1,503 million as at 31-03-2020, which represented 25.7 % of the company’s share capital. This decrease is due to the net profit recorded in this quarter. During the second quarter of 2020, the Company made an early voluntary payments for financing agreements amounting SAR 1.1 billion bring the total payments within 21 months to SAR 2.5 billion, which portrays the company’s solid cashflow generation Total capex investment for the first six-month of 2020 is SAR 1,859 million out of which SAR 607 million related to the acquisition of new spectrum in addition to the rollout capitalization of the 5G investment. Noting that Zain KSA was awarded recently Ookla’s renowned speed test award for Saudi Arabia’s fastest fixed network. |