Ooredoo Kuwait Q1 Net Profit Plunges 89%

Ooredoo Kuwait, the country’s No.3 telecoms operator by subscribers, blamed foreign-exchange losses from its Tunisia and Algeria operations as it posted an 89 per cent fall in first-quarter profit that extended a lengthy earnings slump.

The subsidiary of Qatar’s Ooredoo competes domestically with Zain and Saudi Telecom affiliate Viva and has now reported falling profits in 10 of the past 13 quarters.

Ooredoo Kuwait made a net profit of KD2.2 million ($7.3 million) in the three months to March 31, down from KD19.8 million a year earlier, it said in a statement.

EFG Hermes had forecast that Ooredoo Kuwait, which also has operations in Algeria, Tunisia, the Maldives and the Palestinian Territories, would make a quarterly profit of KD13.3 million.

First-quarter revenue was KD174.3 million, against KD182.7 million a year ago.

The company said that declines in the Tunisian and Algerian currencies had led to first-quarter foreign-exchange losses of KD12.9 million.

Its Tunisian business provided a net profit attributable to Ooredoo Kuwait of KD2 million in the first quarter, down from KD5.8 million.

It fared worse in Algeria, making a net attributable loss of KD3.5 million, compared with an KD8.6 million profit in the same period last year. Excluding foreign-exchange losses, the unit’s first-quarter profit would have been KD6.5 million.

Domestically, Ooredoo Kuwait has slipped to third place in terms of mobile subscribers, data from Zain shows, as Viva grabbed market share through aggressive pricing.

Ooredoo Kuwait had 2.5 million subscribers at March 31, up 11 per cent year on year, with revenue up 4.6 per cent to KD44.3 million. Domestic net profit, however, was flat at KD2.9 million, indicating weakening margins.