Zain Saudi narrows losses by 24% to SAR 972 mln in FY15

Zain Saudi, the kingdom’s third largest mobile operator, narrowed net losses by 23.5 percent year-on-year (YoY) to SAR 972 million for the 2015 fiscal year, from SAR 1.27 billion a year earlier on the back of a 23 percent increase in gross profit to SAR 3.9 million, its highest since its start, and a higher gross profit margin.

Increased revenue from growing demand for its services and better cost management also helped in cutting annual losses. 

In Q415, Zain’s losses eased by 4.9 percent YoY to SAR 291 million. Net losses, however, widened by 31 percent from SAR 223 million in Q315. The telco said lower quarterly losses were backed by a 30 percent rise YoY in gross profit, which pushed margins up to 64 percent.

Its losses increased quarter-on-quarter due to higher operating expenses, depreciation, and amortization costs.

Fourth-quarter earnings before interest, taxes, zakat, depreciation and amortization (EBITDA) jumped 47 percent YoY, implying a higher margin of 24 percent YoY, thanks to the telco’s successful turnaround strategy, higher sales, and better cost optimization.

Zain’s subscriber base grew significantly by 28 percent YoY to 12.4 million customers by the end of Q415, compared with 9.7 million users in the same quarter of 2014.