Telecoms Firm Zain Saudi Posts Narrowed Q2 Net Loss

Telecom operator Zain Saudi reported a narrowed second-quarter loss on Wednesday as it cut costs and benefited from favourable legal judgements, although the loss was slightly bigger than analysts had expected.

The firm, which began operations in 2008, claimed 15 per cent of Saudi’s mobile subscribers at the end of 2013 and has struggled to break the dominance of better-resourced rivals Saudi Telecom Co and Etihad Etisalat (Mobily).

Chief Executive Hassan Kabbani, an industry veteran appointed in September, told Reuters in April that Zain Saudi aimed to break even within five years.

The company, 37-per cent owned by Kuwait’s Zain, made a net loss of SAR329 million ($87.7 million) in the three months to June 30, according to a bourse filing. That compares with a loss of SAR370 million in the prior-year period.

Analysts polled by Reuters had on average forecast a loss of SAR310.8 million.

The company said it had made its operations more efficient, benefited from favourable judgements in court cases and extended the lifespan of some assets.

Zain KSA also reported significant growth in its internet business year, with revenue and subscribers soaring 94 per cent and 107 per cent respectively.

Parent company Zain reported a two per cent fall in second-quarter net profit earlier on Wednesday, its sixth quarterly decline in the past eight quarters but in line with analyst expectations.