Net profit up by 42% to KD 17.3 million in H1 2019

KUWAIT: National Mobile Telecommunications Company K.S.C.P "Ooredoo Kuwait" announced yesterday its financial results for the half year period ended 30 June 2019:
Financial highlights:

• Consolidated customer base increased by 2 percent to 26.7 million in H1 2019, compared to 26.1 million in H1 2018.
• In local currency terms Kuwait, Tunisia and Maldives recorded good growth in revenue. However, revenues in KD were impacted by a 21 percent depreciation of the Tunisian dinar and the decrease in Algeria revenue mainly due to the weak economic environment, currency devaluation and price competition. Consequently, consolidated revenue decreased by 9 percent to KD 310.4 million for H1 2019, compared to KD 341.4 million for the same period in 2018.
• EBITDA increased by 8 percent for H1 2019 to KD 115.9 million, compared to KD 107.6 million for the same period in 2018, supported by the implementation of IFRS 16, a new accounting standard and operational efficiencies.
• Net profit attributable to NMTC was KD 17.3 million for H1 2019, representing a strong growth of 42 percent compared with KD 12.2 million for the same period in 2018. Net Profit growth was supported by good performances by Ooredoo Kuwait and Ooredoo Tunisia.
• The consolidated earnings per share was 35 fils for H1 2019, compared to 24 fils per share earned for the same period last year.
  

Sheikh Saud Bin Nasser Al-Thani, Chairman of the Board of Directors commented:
"Ooredoo Kuwait (NMTC) continues on the path of digital transformation as we work towards our vision to enrich the digital lives of our customers. We are constantly adapting and refining our service offering to meet the evolving needs of our customers. I am pleased to report a 42 percent increase in our Net Profit for the first half of 2019 and an increase of our customer base by 2 percent to 26.7 million in H1 2019 year on year. Overall, we reported a sound set of results with all of our operations, excluding Algeria, reporting an increase in EBITDA. Algeria was affected by economic instability, currency devaluation and intense price competition putting pressure on EBITDA during the period. Group EBITDA increased 8 percent during the first half of 2019, positively supported by the implementation of IFRS 16, which came into effect on January 2019.
Impacted by geopolitical and macroeconomic factors, as well as the currency depreciation in Algeria and Tunisia, our top line remains under pressure. During the first half of 2019 revenues declined by 9 percent due to the broader industry wide shift towards data from traditional voice and SMS services.
In Kuwait, EBITDA increased 48 percent during the first half of the year, driven by the realization of savings from our cost optimization program as well as the positive impact from the implementation of IFRS 16.
In Tunisia, we increased our subscriber base by 5 percent and grew EBITDA to KD 26.8 million in the first half of 2019, despite the 21 percent year on year depreciation of the Tunisian dinar.
In Algeria we made good progress in preparing for a data centric future, by increasing the coverage of our 4G network to 58 percent of the population. In Palestine we performed exceptionally well, with our customer base up 5 percent and EBITDA increasing 23 percent due to various cost optimization initiatives.
Maldives continued to perform well, with a 4 percent increase in customer numbers, 2 percent increase in revenue and a 10 percent increase in EBITDA."

Review of operations
The Group's operational performance can be summarized as follows:
Ooredoo - Kuwait
Ooredoo's customer base in Kuwait increased to 2.5 million in H1 2019, up 6 percent compared to H1 2018. Revenues for H1 2019 were KD 114.1 million, compared to KD 127.6 million in H1 2018. EBITDA was strong, increasing to KD 36.0 million for H1 2019, compared to KD 24.3 million for H1 2018. The increase of 48 percent reflected good operational efficiencies across the business as well as a positive impact of the new IFRS 16 accounting standard.
Ooredoo - Tunisia
Ooredoo's customer base in Tunisia increased 5 percent to reach 8.8 million customers in H1 2019, compared to the same period in 2018. The Tunisian dinar depreciated by 20.8 percent year on year, leading to a decrease in revenues from KD 63.7 million in 1H 2018 to KD 57.5 million in H1 2019. In local currency terms, revenues were up by 9 percent. EBITDA was KD 26.8 million in H1 2019 compared to KD 24.2 million in H1 2018.
Ooredoo - Algeria
Customer base in Algeria stood at 13.6 million in H1 2019. Business in Algeria was negatively impacted by the devaluation of the Algerian Dinar, weak economic environment and price competition. Revenues also decreased to KD 104.9 million in H1 2019, compared to KD 115.7 million in H1 2018. EBITDA was KD 38.3 million in H1 2019, down from KD 46.0 million in H1 2018. Algerian dinar depreciated by 2.6 percent year on year.
Ooredoo - Palestine
Customer base in Palestine increased by 5 percent to reach 1.3 million customers in H1 2019. Revenue decreased to KD 14.2 million in H1 2019, compared to KD 15.0 million in H1 2018. EBITDA was strong, increasing to KD 4.1 million in H1 2019 compared to KD 3.3 million in H1 2018, up by 23 percent compared to the same period in 2018.
Ooredoo - Maldives
Ooredoo Maldives reported a 2 percent increase in revenues to KD 19.7 million in H1 2019, compared to KD 19.2 million in H1 2018. EBITDA for H1 2019 was KD 10.9 million, an increase of 10 percent compared to KD 9.9 million for the same period in 2018. Ooredoo Maldives now serves a total of 447k customers, an increase of 4 percent compared to H1 2018.