KUWAIT: The Zain Group Annual General Meeting (AGM) was held yesterday at the Zain Group's headquarters in Kuwait, attended with a quorum of 69.95 percent that approved the recommended cash dividend of 33 percent (33 fils per share) to the shareholders already registered in the company's record date of 5 April 2020. Cash dividends will be paid to shareholders commencing 9 April 2020. Additionally, a first by any corporate entity in Kuwait, the AGM approved Zain's adoption of a minimum cash dividend policy of 33 fils per share for three years, commencing 2019.

Furthermore, the AGM elected the Board of Directors for the next three years. The incoming Board members now constitute the following: Ahmed Tahous Al-Tahous, Representative of the Kuwait investment Authority; Bader Nasser Al-Kharafi, Elected; Yousef Khalid Abdul Razzaq, Representative of the Kuwait investment Authority; Talal bin Said Al-Mamari, Representative of Fajer Al Nasim for selling and buying stocks and bonds; Zaki Hilal Saud Al-Busaidi, Representative of Jawhara Al-Jeblah for buying and selling Stocks and bonds; Atef bin Saeed bin Rashid Al-Siyabi, Representative of Abeer Al-Shorouq for selling and buying stocks and bonds; Abdullah Salem Abdullah Al-Harthy, Representative of Naseem Al-Delta For buying and selling stocks and bonds; Martial Antoine Marcel Caratti, Representative of Dana Al-Qebla for selling and buying stocks and bonds; Abdulrahman Mohammad Ibrahim Al-Asfour, Independent.

During the AGM, Zain Group announced its financial results for the full-year 2019, whereby the company served 49.5 million customers. The company generated consolidated revenue of KD 1.66 billion ($5.5 billion), an impressive 26 percent Year-on-Year (Y-o-Y) growth, while consolidated EBITDA for the period rose by 40 percent Y-o-Y to reach KD 728 million ($2.4 billion), reflecting a healthy EBITDA margin of 44 percent. Consolidated net income reached KD 217 million ($715 million), up 10 percent Y-o-Y and reflecting Earnings Per Share of 50 fils ($0.17).

For the full-year, foreign currency translation impact, predominantly due to the 30 percent currency devaluation in Sudan from an average of 31.9 to 45.8 (SDG / USD), cost the Group $140 million in revenue, $61 million in EBITDA and $20 million in net income. Excerpts from Zain Group Chairman, Ahmed Al-Tahous statement at the AGM
On behalf of the Board of Directors I would like to welcome you to the AGM. The company's impressive performance for 2019 is testament to the successful implementation of the strategic and sustainability-conscious roadmap set by the Board and management.

We will maintain our resolve to rollout high quality telecommunications services across our markets in a responsible manner, empowering and improving the socio-economic well-being of the communities we serve. We are proud of our pioneering role in Kuwait and across the region and look forward to 2020 and beyond with enthusiasm, as we take further steps in our aspirations to be a leading ICT and digital lifestyle provider.

Despite continuing competitive and socio-political challenges, Zain Group's performance during 2019 witnessed strong growth in all its financial indicators. This growth was underpinned by the successful rollout of numerous new digital services in both the consumer and enterprise space, coupled with solid performances across all our markets, as well as the strategic consolidation of Zain Saudi Arabia into Zain Group.

The company is committed to investing in its networks and taking advantage of the ever-increasing demand for broadband internet services. Zain continued to invest and upgrade its 3G and 4G networks across its footprint during 2019, and introduced 5G services in June 2019, making it the first operator to launch the technology in Kuwait and the region. Zain went on to launch the largest 5G network in Saudi Arabia in October 2019, which at the time was the largest in the MENA and Europe and third largest globally, and in November, announced plans of a 5G launch by Zain Bahrain within the first half of 2020.

I would like to thank all the government ministries and regulatory authorities across our markets for their wisdom and understanding of the emerging industry dynamics, supporting us in overcoming challenges faced by the telecom sector. Excerpts from Zain Group Vice-Chairman and Group CEO, Bader Al-Kharafi's AGM statement. It is a profound pleasure to address the AGM considering the exceptional operational and financial year we achieved in 2019. Across activities and geographies, Zain Group excelled substantially, leveraging the talent of its progressive workforce and seeking opportunities in new lucrative areas. These include appealing digital services offered through our state-of-the-art 4G and 5G platforms and the development of enterprise and cloud solutions serving the government and business sectors in order to drive revenues and margins.

In rapidly changing ecosystems defined by the Fourth Industrial Revolution and a greater demand for accountability, the need to evolve the organization to extract maximum value while implementing a more responsive approach to the environment and specifically climate change is highly relevant to Zain. Across our footprint, more than 7,200 dedicated and talented Zainers continue to strive to provide customers Meaningful Connectivity through a relevant range of services to help the communities we serve lead better lives.

New 3-year dividend policy
A first by any corporate entity in Kuwait, the Board of Directors have recommended a new cash dividend policy committing the company to a minimum 33 fils for three years inclusive of 2019. This recommendation is a result of the impressive operational performance attained by the Group in recent years and confidence in the future potential of our digital growth strategy in seeking new business verticals. We expect to reap healthy rewards from our investments in 5G, Fiber and network upgrades across key markets that support the ever-increasing demand for mobile and fixed broadband services by individuals and enterprises alike.

Investing for growth
Throughout 2019, Zain Group invested over USD 1 billion in CAPEX, predominantly in expansion of Fiber-to-the-Home (FTTH) infrastructure; spectrum fees; 4G upgrades and new network sites across its markets, as well as 5G rollouts in Kuwait and Saudi Arabia. In addition to supporting our digital transformation aspirations, this huge investment is paying off as reflected by the 36 percent annual growth in the Group consolidated data revenue that reached $2 billion, representing 36 percent of the Group's revenue for 2019.

Digital strategy gains momentum
Our digital expansion strategy is taking shape, centered on evolving our core telecom business to maximize value and building on our many strengths to selectively invest in growth verticals beyond standard mobile services that support our vision of becoming a leading ICT and digital lifestyle provider that makes the world a better place.

Moreover, we are setting up structures and entering into key partnerships in the FINTECH and e-Health arena as well as with our newly established Zain Drone entity that was launched in Kuwait and Saudi Arabia to date, and opening our APIs across key markets to offer appealing entertainment and gaming services, so as to reap the lucrative opportunities in the digital space. We will continue to foster this lucrative and customer appealing platform that provides customers access to multiple mobile-led services. Zain Kuwait, Bahrain, Iraq, Jordan, and Saudi Arabia are benefitting from new revenue streams from this cloud API service, with Omantel recently joining the platform.

Regulatory key to 5G
To ensure the success of our strategy, we have been very active in the regulatory arena in regard to spectrum acquisition and in seeking support from regulators and other government authorities. During 2019, we acquired or renewed over 600 MHz of the frequency spectrum across markets in various bands at an acquisition commitment price of nearly $300 million.

In Kuwait and Saudi Arabia, the allocation of these spectrum bands has facilitated the launch of 5G services as is the case with Bahrain that will soon launch 5G. On this point, I would like to point out that we were the first operator in the region to offer 5G roaming between Kuwait and KSA back in November.

The company is mobilizing resources to capitalize on the enormous prospects that 5G technology provides, creating vast opportunities in the value chain proposition in numerous industries, especially with regard to enterprise (B2B) services to government and businesses of all sizes. We believe 5G will push the telecom sector to a new and exciting phase of growth.

Sustainability, Diversity & Inclusion
A core part of the strategy is the creation of positive socio-economic impacts across the region, which begin within the company. Priorities within our sustainability efforts include, but are not limited to, contributing to the socio-economic development of our operating countries; aligning to climate change targets and developing our employees, all of which ultimately leads to a more successful and profitable organization.

In our world, digital and technological advancements offer endless opportunities to not only address negative impacts but create positive ones. Through digitization, our wide range of services, and reach, we aim to unlock the many opportunities that the Sustainable Development Goals (SDGs) offer, as sustainability is an intrinsic part of our DNA. Most recently, for example, Zain became a member of the Climate Disclosure Project (CDP), thus paving the way to a structured reduction of our environmental footprint.

Zain's Diversity and Inclusion (D&I) initiatives are among the most compelling and comprehensive of any organization in the region. The work that Zain currently does within the organization to foster understanding and offer great life and work opportunities to all employees is truly inspiring.

Initiatives that fall under our D&I focus, to name just a few, include Gender Diversity (Women Empowerment); our aim for Zain to become Disability Inclusive by 2022 (WE ABLE); becoming a signatory to the International Labor Organization (ILO) Global Business and Disability Network Charter; Reverse Mentoring and our Generation Z graduate program (ZY); and our internal innovation program (ZAINIAC).

These D&I-based programs have all become central to Zain's development as an organization, with their overwhelming success seeing Zain operations immediately enjoy many direct benefits as well as being appreciated by our own people and external stakeholders alike.

Thank you
On a final note, on behalf of the executive management team, I would like to express my deep, personal gratitude to the Zain workforce, the Board of Directors, and the government agencies and bodies we cooperate with to deliver the mobile experience and services we do at such a high level. I believe we can look ahead with confidence as we continue to make considerable progress and help uplift the societies we serve along the way.

BOX OUT
Health Safety: Zain provided Live Streaming of AGM to registered shareholders

• Fulfilling its obligations towards its shareholders, Zain held its Annual General Meeting (AGM) in Kuwait in an open-air setting following guidelines set by the Ministry of Health
• Given the circumstances, Zain Group transmitted livestreaming of the AGM in Arabic and English to registered shareholders, who were unable to attend due to safety concerns or travel restrictions
• Shareholders on the live broadcast were granted five minutes to ask questions
• As the first company in Kuwait to provide livestreaming of its AGM, Zain hopes that other listed entities follow suit, to fulfill their obligations towards shareholders considering these current conditions
• Al-Kharafi thanked the shareholders for their cooperation, and the technical and support teams for their efforts in providing the live stream within the safety guidelines
  
  Zain studying options re Mobile Virtual Network Operator (MVNO)
  
  Recently the relevant authorities in Kuwait extended the application period for the awarding of a MVNO license. Commenting on this matter, Al-Kharafi acknowledged that a MVNO can complement existing telecom operators given the mechanism in which MVNOs operate. Furthermore, Al-Kharafi indicated that Zain is studying its options within the extended application period and will make a decision based on the best interests of shareholders and all other stakeholders.