Zain Group’s board appoint chairman and CEO
Zain Group’s newly elected board has appointed Mohannad Al-Kharafi as chairman and Bader Al-Kharafi as vice-chairman and CEO of Zain Group.
The Middle East operator held its annual Ordinary General Assembly where its cash dividend of $0.11 per share for the financial year ending 31 December 2016 and the election of the Group Board of directors for the next three years were both confirmed. Scott Gegenheimer was appointed in a new role as chief executive officer of operations.
Incoming Zain Group Board members:
Mohannad Mohammad Al-Kharafi; Bader Nasser Al-Kharafi; Ahmed Tahous Al-Tahous (the representative of the Kuwait Investment Authority); the corporate entities: Fajer Al Nasim for selling and buying stocks represented by Houssam Fawzi Al-Kharafi; Nasim Al-Delta for selling and buying stocks represented by Khaled Ali Al-Ghanim; Abeer Al-Shorouq for selling and buying stocks represented by Talal Jassem Al-Kharafi; Jawharat Gibla for selling and buying stocks represented by Faisal Nizar Al-Nusif; and Dana Al Qebla for selling and buying stocks represented by Khaled Waleed Al-Falah.
During the General Assembly, the Group reported a 2% year-on-year increase in net profit to hit KWD 157 million ($519m), reflecting earnings per share of 40 fils ($0.13). Total annual consolidated revenue for the year amounted to KWD 1.1 billion ($3.6bn), while EBITDA grew 3% to KWD 512 million ($1.7bn). Zain Group’s customer base grew by 3% during the year, reaching more than 47 million customers.
Zain’s financial results were affected by social unrest and security risks in several of the company’s markets, along with fluctuations in currency exchange rates and monetary policies that were imposed in some markets. At the Assembly, he added: "The result of several factors beyond our control negatively impacted our overall operational performance in 2016, as we witnessed worsening social economic developments affecting Zain operations in Iraq and Sudan."
Saudi Arabia and Iraq:
However, Zain still made strategic and operational progress, and in Saudi Arabia, for example, the decision from the Communications and Information Technology Commission to extend Zain Saudi Arabia's licence for an additional 15 years was a significant boost to the operation there.
Al-Kharafi explained that Zain Iraq succeeded in reaching a negotiated settlement with the country’s Finance Ministry related to an imposition of a capital gains tax on its Iraqna acquisition in 2007. This resulted in the lifting of restrictions on the trading of Zain Iraq's shares, access to the company’s bank deposits, and the waiving of penalties and interest on taxes.
“Investments in emerging technologies will diversify our revenue streams,” said vice-chairman Bader Al-Kharafi. "Zain Group continues to focus on innovation in digital services, and we expect our investment program to drive us in new areas as we collaborate with innovative technology players.”
Zain has identified service provision in the smart cities space and in B2B/enterprise sector as significant growth areas and has been investing accordingly. Such developments fall under the Zain Digital Frontier and Innovation (ZDFI) business strategy, a unit that was established in 2014, and charged with launching Zain into the digital space with the view to growing the company through new innovative business streams, which add to its financial viability and market capitalisation.