Mobile Telecommunication Company Saudi Arabia (Zain KSA) has seen a 17.7 percent decrease in net profit in 2021 as COVID-19 driven repercussions weighed on revenues.
Net profit dropped to SR214 million ($57 million) on an annual basis, compared to SAR 260 million in 2020, as shown by the company's consolidated financials for the year ended 31 December 2021.
According to a filing to Saudi Exchange, Tadawul, the decline was due to a 22 percent rise in revenue cost, resulting in a cumulative 10.3 percent decrease in gross profit.
Revenues remained almost unchanged, weighed down by the pandemic limiting Umrah visits, but compensated by a growth in business to business and 5G network revenues, it added.
However, the Riyadh-headquartered firm managed to narrow operating expenses by SR247 million and limit finance costs by SR409 million, buoyed by debt restructuring.
Total Capex investment for the full year 2021 was SAR 1 billion, to further expand the 5G network, enhance the quality of services provided to customers.
In Q4 2021, the company reported a net profit of SAR 71.1 million, a rise of 98% year-on-year (YoY), due to higher B2B and 5G revenues, despite the increase in the cost of revenue by 12% to SAR 78 million. Compared with the previous quarter, net profit rose 17.7% from SAR 60.39 million.
Meanwhile, shareholders' equity, excluding minority interest, amounted to SAR 9.04 billion in 2021, up 3.56% compared to SAR 8.72 billion a year earlier.