Zain announces financial results for 2008

For the year 2008, Zain Group recorded consolidated revenues of US$ 7.441 billion, an increase of 26% compared to 2007. The company's consolidated EBITDA increased by 15% for the same period to reach US$ 2.78 billion. Consolidated net profits reached US$ 1.2 billion, an increase of 6% on 2007. The earnings per share were US$0.33 and the shareholders equity was up 36% to US $8.69 billion.

Year-on-year customer growth across the two continents in which Zain operates was 50% with the Zain Group serving 63.54 million managed active customers at 31 December, 2008.

Chief executive officer of Zain, Dr Saad Al Barrak commented: “Despite a very challenging environment on many fronts and huge investments in network expansion, the group was able to achieve appealing and realistic levels of profitability during 2008...”.

Zain, according to Dr Al Barrak is targeting a 30% increase on its financial indicators in 2009.

Chief executive officer of Zain, Dr Saad Al Barrak

Overcoming the global economic crisis

Referring to the global financial crisis and volatility that has affected many equity markets, commodities and currencies, Dr Al Barrak said, “Despite the fact that [the] company had to endure higher borrowing rates in the second half of the year and a currency exchange cost of US$ 138 million which was predominantly in Africa, it still performed admirably. Without this loss caused by currency fluctuation we would have added another 12% to the net profit figure.”

Defending the Zain share price that sees it trading at historical low Price Earnings multiples, amid the negative sentiment that is gripping world stock markets and seeing billions wiped off valuations, including telecom groups to the range of 30 to 70%, Dr Al Barrak said, “We believe this unjustifiable in Zain's case as the debt levels of the group fall within a reasonable range when compared to many other international mobile groups...”