Saudi mobile telecommunications company Zain Saudi Arabia announced its annual financial results for 2023, showing a 1.3% growth in net profit to reach SAR 604 million, compared to SAR 596 million recorded in 2022. This growth is supported by strong operational performance and the company achieving its highest revenues in its history, which amounted to SAR 10.98 billion.
Revenue growth driven by digital transformation
Zain Saudi Arabia's revenues for 2023 witnessed remarkable growth of 6%, an increase of SAR 618 million compared to the previous year's SAR 10.36 billion. The company attributed this record performance to several key factors, primarily the rise in retail revenues thanks to the significant expansion of 5G services, which enhanced the customer experience and increased data consumption. Growth in wholesale revenues also contributed positively, along with the continued expansion of Tamam Finance, Zain's fintech arm, reflecting the company's strategy to diversify its revenue streams and capitalize on the opportunities of the digital economy.
Strong operational performance reflects the robustness of the core business
When analyzing net profit, it is important to note that the 2022 profit included non-recurring benefits totaling SAR 233 million. These benefits consisted of SAR 76 million related to the application of the new Zakat regulations and SAR 157 million resulting from a one-time tax adjustment. Excluding these non-recurring items, the 2023 net operating profit shows strong year-on-year growth of SAR 241 million, underscoring the significant improvement in the company's operational performance and the efficiency of its core operations.
General context and keeping pace with Vision 2030
These positive results come at a time when the Saudi telecommunications sector is undergoing a radical transformation, driven by the goals of Vision 2030, which places digital transformation at the heart of its development strategy. Zain Saudi Arabia, as one of the leading operators in the market, is playing a pivotal role in enabling this transformation through its significant investments in 5G network infrastructure. This performance not only reflects the success of the company's strategy but also highlights the strength of the Saudi economy and the ability of the telecommunications sector to grow and thrive in a competitive environment, thus bolstering the confidence of local and international investors in the market.
Distribution of cash dividends to shareholders
To further strengthen shareholder confidence, Zain Saudi Arabia’s Board of Directors has recommended a cash dividend of SAR 449.36 million for the fiscal year 2023. This dividend will be distributed across 898.72 million outstanding shares, at a rate of SAR 0.5 per share, representing 5% of the share's par value. Shareholders of record as of the close of trading on the second trading day following the company’s General Assembly meeting, the date of which will be announced later, will be entitled to the dividend. The distribution date will be determined after approval by the General Assembly.
