Wataniya Telecom posts KD 52.8 million net profit in 2005

"In 2005 Wataniya Telecom grew in each market where it has operations - generating strong cash flow, and as a result the Board of Directors have proposed a cash dividend of 80 % at 80 fils per share and 5% bonus shares, with the cash dividend resulting in an 65% pay-out ratio for the year which is outstanding news for shareholders," said Mr. Faisal Al Ayyar, Chairman of Wataniya Telecom.

"We will continue to focus on growth and seek new opportunities that fit our strategic vision internationally and provide our customers with the best service in the markets we are in.'

Telecom Group Highlights:

- Revenues for the fourth quarter increased to KD 99.3 million (USD 338.3 million), an increase of 2% compared to last quarter revenues of KD 97.1 million (USD 330.8 million), and an increase of 46% compared to the same period in 2004.

- Total active customers jumped to 6,390,504 compared to 5,208,677 from the last quarter, an increase of 23%.

- Consolidated earnings per share are 123 fils for the year as of December 31, 2005.

- The Board of Directors proposed a cash dividend of 80% at 80 fils per share and 5% bonus shares, with the cash dividend resulting in a 65% pay-out ratio for the year.

Kuwait: Wataniya Telecom increased its active customer base to 945,811. Revenues were KD 41.8 million (USD 142.4 million) compared to KD 36.5 million (USD 124.3 million) in the same period of 2004. EBITDA for the 4th quarter of 2005 was KD 19.8 million (USD 67.5 million), or a 48% EBITDA margin, compared to KD 17.6 million (USD 60.0 million), a 48% margin for the 4th quarter of 2004. Net profit for the 4th quarter of 2005 was KD 22.7 million (USD 77.3 million), an increase of 58% compared to KD 14.4 million (USD 49.1 million) for the same period in 2004.

Tunisia: Tunisiana closed the year with 2,257,662 customers that translate to a 42% market share where market penetration has reached 53%. Revenues were KD 24.5 million (USD 83.5 million), an increase of 28% from Q4 2004 or KD 19.1 million (USD 65.1 million). EBITDA was KD 10.1 million (USD 34.4 million), an increase of 46% compared to KD 6.9 million (USD 23.5 million), for Q4 2004. The net attributable profit to Wataniya Telecom from Tunisiana in Q4 is KD 0.7 million (USD 2.4 million).

Iraq: AsiaCell ended 2005 with 1,649,710 customers and has now extended its network to the southern part of the country and now operates in all three regions of Iraq, the first operator to do so. Revenues for the 4th quarter of 2005 were KD 19.6 million (USD 66.8 million) compared to KD 9.3 million (USD 31.7 million) for the 4th quarter 2004, an increase of 111%. EBITDA was KD 7.9 million (USD 26.9 million), versus KD 6.4 million (USD 21.8 million) in the 4th quarter 2004, an increase of 23%. The net attributable loss to Wataniya Telecom from Asia-Cell in Q4 is KD 3.4 million (USD 11.6 million).

Algeria: At year end Nedjma provided coverage to all 48 States in the country and increased its active customer base to 1,475,353 subscribers as compared to 287,000 at the end of 2004. Revenues for the 4th quarter of 2005 were KD 12.6 million (USD 42.9 million) compared to KD 3.1 million (USD 10.5 million) at the end of 2004, an increase of 306%.The net attributable loss to Wataniya Telecom in Q4 2005 is KD 4.5 million (USD 15.3 million) as compared to KD 3.5 million (USD 11.9 million) in Q4 2004.

Saudi Arabia: Bravo's main focus in the fourth quarter was preparation for the religious Haj season that brought more than 2.5 million pilgrims to Mecca and Medinah and other parts of the western region of the Kingdom. Bravo's network was able to handle the high usage of push to talk with great success. The net attributable loss to Wataniya Telecom in Q4 is KD 0.6 million (USD 2.0 million). Bravo is accounted for on the equity method with Wataniya International owning 38%.

Maldives: Wataniya Telecom Maldives closed on a USD 27 million long term financing deal for the build out of its cellular network and its investment in an undersea fiber optic cable project which will carry its international traffic. Customers at the end of the year were 50,162. Revenues were KD 0.8 million (USD 2.7 million).The net loss in Q4 is KD 0.6 million (USD 2.0 million).

The Company's share price as of December 31, 2005 was KD 2.560, giving a Kuwait Stock Market valuation for NMTC (Wataniya Telecom) of KD 1,117.2 million (USD 3.8 Billion). Consolidated earnings per share for period ended December 2005 were 123 fils.