Zain Saudi Arabia announces strong Q3, 2009 results

Most notably, Zain's market share of active mobile users within the Kingdom now exceeds 15%.

The third quarter witnessed growth rates in Gross Profit of 84% to reach SR243m ($65m), compared to Q2, 2009 where the company achieved a total profit of SR133m ($35m), indicating a Gross Profit Margin of 29%, a significant improvement from the 19% attained in the previous quarter.

The period also saw an Operating Loss of SR668m ($178m), a reduction of 5% compared to Q2, 2009 (SR706m or $188m). This reflects a Net Loss of SR820m ($219m), a 4% reduction for the same period.

"Our third quarter results reflect the significant improvement in the performance of the company on all financial fronts. Despite the current economic conditions and fierce competition in the market, the company has surpassed its revenue and customer targets for this period."

commented Dr. Saad Al Barrak, CEO of Zain Group and Zain Saudi Arabia.

Dr Al Barrak also noted that, "As with many start-ups, operational losses are expected in the short term. However we are witnessing a continual reduction in these losses at a faster rate than our initial projections."

He also mentioned that the company succeeded, during this period, in increasing its customer base to over 15% of active mobile users in the Kingdom. "Zain managed to attract a large component of the market despite fierce competition and this is a testament of the quality and diversity of the services we offer."

Commenting on the company's day-to-day operational activities, Chief Operating Officer, Ismael Fikree said "By the end of the 3rd quarter, Zain can boast a 73% coverage of the kingdom's populated areas, covering more than 245 towns and villages with a modern and sophisticated network."

Fikree also noted that Zain KSA was awarded ISO certificates for its systems and information security, and strengthening its CSR credentials by launching a series of high-profile initiatives for social development.

Most significantly however, on August 11, 2009 Zain KSA signed a Murabaha financing facility worth $2.5bn (SR9.37bn) with a group of local and international banks in what was one of the largest Islamic financing deals of the year. "The Murabaha facility comes at a vital stage of Zain KSA's business growth cycle assisting the company to meet its financial obligations," said Dr Al Barrak. "The granting of this facility is an enormous vote of confidence by the International financial community in Zain KSA's performance to date and its future expansion plans in what is the region's largest economy."