Middle East and Africa mobile operator Zain reported a net profit of USD 1.2 billion for 2008, a 6 percent increase over the previous year. Zain, which is present in 22 countries, recorded revenue of USD 7.44 billion, an increase of 26 percent compared to 2007, while EBITDA increased 15 percent to reach USD 2.78 billion.
Year-on-year customer growth across the two continents in which Zain operates was 50 percent, with the Zain Group serving 63.54 million active customers at 31 December 2008. The Kuwait-based company has recommended a cash dividend of KWD 0.50 per share. During the year Zain committed over USD 3 billion to network upgrades and expansion, primarily in growing markets such as Ghana, Iraq, Nigeria, Saudi Arabia and Sudan.
This is expected to contribute to a further 30 percent increase in many of its financial indicators in 2009. The company raised USD 4.49 billion in September 2008 in a share issue, which will support further expansion. Zain has recently paid back a Murahaba facility of USD 1.2 billion as well as the first installment of USD 525 million for the purchase of Iraqna and several other financial obligations.
The company noted that profit growth was limited last year due to higher borrowing rates in the second half of the year and an adverse USD 138 million currency exchange cost, predominantly in Africa. Zain said it views the world financial crisis as an opportunity to make further acquisitions, given valuations of many prime telecom assets are considerably lower than they were six months ago, and the company is actively pursuing such prospects.
Zain will also adapt its strategy to use share swaps and minority stakes if acquisition opportunities are attractive