Mobile Telecommunications Company (ZAIN) Q4 2024 earnings summary

Executive summary

• FY 2024 revenue reached $6.4 billion (KD 1,971.9 million), up 3.3% year-over-year, with strong growth across major markets despite challenges in Sudan.

• Net income for FY 2024 was $677 million (KD 250.96 million), down 3% year-over-year, but normalized net income rose 15% after adjusting for one-time items.

• The auditor issued a qualified opinion due to lack of IAS 29 hyperinflation adjustments for Sudanese subsidiaries, impacting comparability and reliability of results.

• Launched the '4WARD' strategy in December 2024 to accelerate transformation into a regional tech conglomerate.

• Operations in Sudan faced significant disruption due to ongoing conflict, resulting in asset impairments and heightened operational risk.

Financial highlights

• Q4 2024 revenue grew 7% year-over-year, with net income up 120% due to top-line performance and a gain on business combination.

• EBITDA for FY 2024 was $2.25 billion, up 2% normalized year-over-year; EBITDA margin at 35%.

• EPS for FY 2024 was 16 cents (48 fils from continuing operations), unchanged from 2023.

• Total CAPEX for FY 2024 was $1.07 billion (KD 325.9 million), representing 17% of revenue, focused on 5G, digital infrastructure, and network modernization.

• Total assets: KD 5,264.1 million; total equity: KD 1,961.9 million.

Outlook and guidance

• FY 2025 revenue guidance: +7% to 10% growth; net income expected to grow 3% to 5%; CAPEX/revenue ratio to decrease to 15%-17%.

• Dividend policy extended for three years, maintaining a minimum annual cash dividend of 35 fils per share.

• Management expects to maintain operational continuity in Sudan barring escalation of hostilities.

• Anticipates higher effective tax rates from 2025 due to OECD Pillar 2 implementation in low-tax jurisdictions.

• No material impact expected from new IFRS standards not yet effective.