Zain Saudi Arabia, a leading telecommunications provider in the kingdom, has registered a gross profit of SR1.14 billion ($303 million) in the fourth quarter, up 7 per cent over SR1.06 billion ($282 million) for the same period in 2015.

Announcing its financial results for the quarter ending December 31, 2016, Zain Saudi said its revenues for the period rose eight per cent to hit SR1.8 billion from SR1.6 billion the year before.

Revenues for the twelve-months of 2016 grew by three per cent reaching SR6.92 billion, up from SR6.74 billion for the same period in 2015.

The Saudi telco group reported steady gross margin at 63 per cent compared to 64 per cent during Q4 2015, whilst gross profits during the twelve-month period reached a record SR4.4 billion increasing by 11 per cent up from SR3.9 billion during the same period of last year, with gross margin of 64 per cent improved compared to 59 per cent the previous 12 months' period.

The company reported a significant 21 per cent increase in ebitda in Q4, 2016 to reach a record SR490 million, up from SR405 million during the same quarter of 2015. The ebitda for the 12 months of 2016 amounted to a record SR1,795 million, up 10 per cent on SR1,629 million recorded in the same period of 2015.

Zain Saudi recorded an operating profit of SR87 million during Q4 2016, up from a loss of SR82 million in the same quarter in 2015, Q4 2016 includes the incorporation of the relevant amortization savings associated with the 15-year license extension.

The telco firm narrowed its net losses for Q4 2016 by 54 per cent to SR135 million, down from SR291 million during Q4, 2015, and by 49 per cent compared to SR267 million in Q3 2016 reflecting the lowest net loss since inception.

The net losses for the twelve-month period increased by 1 per cent in 2016, reaching SR980 million, up from SR972 million a year earlier. The fourth quarter also marked the end of the arbitration process between Zain and Mobily, with the final judgement of the arbitration panel being fully provided in the accounts.

Commenting on the results, Prince Naif bin Sultan bin Mohammed bin Saud Al Kabeer, the chairman of the board of directors of Zain Saudi Arabia said: "Q4 2016 marked the most significant development for the company since inception, following the High Order announced on October 1, to extend the company's licence by 15 years and upgrade it to a unified licence."

"The extension of the license decreased the amortization charge by SR108 million during the quarter," he noted.

CEO Peter Kaliaropoulos said despite increased competition and challenging conditions in the kingdom's telecom sector, Zain delivered healthy revenue growth and better margins for the quarter and year-on-year.

"The important and necessary biometric identification requirement which Zain is fully committed to, whilst adversely affecting the total customer base of all industry operators, it also provided the opportunity to gain new, first time to Zain, customers. We will continue to deliver better value and quality to consumers and businesses through ongoing investment in our network and innovative voice and broadband offers," he added.

Commenting on the High Order, Kaliaropoulos said: "Zain Saudi's net losses have decreased significantly due, in part, to the impact of the extension of our license and growth in revenues. The upgrade of the licence to a unified licence will enable the company to introduce a wider range of telecommunications services, including fixed services, leveraging Zain's network and that of new partners."

"Customers across all sectors will increasingly have more choice for broadband services to the home and communications solutions for their business," stated the company chief.

"We will continue to face very tough market challenges in 2017 and we need to remain clearly focused and continually improve all aspects of our operations," he added.-TradeArabia News Service