On The Wires: Zain Saudi Arabia has posted a first-quarter loss of 532 million riyals but makes progress since a year ago.
Zain Saudi Arabia posts a loss but narrows the gap
Zain Saudi Arabia, a unit of Kuwait's Mobile Telecommunications, said its first-quarter loss narrowed as the kingdom's third-largest phone company by market value attracted customers with new services.
The loss fell to 532 million riyals (Dh521m), or 0.38 riyal per share, from 662m riyals, or 0.47 riyal, a year earlier, the Riyadh-based company said in a statement on the Saudi bourse website today. First-quarter revenue rose 36 per cent to 1.48bn riyals.
Saudi telecom companies, including Saudi Telecom, are competing for mobile-phone and internet customers with advertising campaigns and pricing promotions. Mobile-phone users rose 15 per cent to 51.6 million by the end of 2010 from a year earlier and internet users increased 11 per cent to 11.4 million, the Saudi Communication and Information Technology Commission said on its website.
The quarterly loss narrowed "due to the success of the company in expanding its customer base by offering new services," Chief Executive Officer Saad al-Barrak said in the statement.
Zain Saudi Arabia's share price declined 11 per cent during the first quarter. The share price closed unchanged at 6.95 riyals yesterday in Riyadh.
It said on April 12 it signed an accord with a group of banks on refinancing $600m of debt. The two-year Shariah-compliant transaction was arranged by banks including Arab National Bank, Banque Saudi Fransi and Bahrain-based Gulf International Bank, the company said in a statement to the Saudi bourse.
Zain Saudi's net debt rose to 14.68 billion riyals by the end of last year, according to data compiled by Bloomberg.
The company signed an agreement with Bahrain Telecommunications and Kingdom Holding on April 6 to sell a 25 per cent stake in Zain Saudi Arabia. Saudi Telecom is the largest mobile phone operating in the kingdom.