Ooredoo Group announces net profit of $53.01mln in Q1 2021

 

Group net profit attributable to Ooredoo shareholders decreased by 50% year-on-year to (QR193 million) in Q1, mainly due to foreign exchange impact coming from Myanmar with an FX loss in Q1, 2021 versus an FX gain in Q1, 2020.

 

Excluding the FX impact, the net profit increased by 120%, Ooredoo said.

 

Marginal year-on-year revenue decline of 1% to QR7.2bn in Q1, 2021 was due to a negative FX impact. Despite the Covid-19 pandemic (excluding FX impact) revenue increased by 1%, mainly driven by growth in its home market- Qatar and in Indonesia.

 

EBITDA increased by 6% year-on-year to QR3.2bn in Q1, 2021, as the company maintains its focus on digitalisation and cost optimisation.

 

EBITDA margin increased to 45% in Q1, 2021 from 41% in Q1, 2020, supported by EBITDA margin expansion in Indonesia, Kuwait, Iraq and Myanmar. Excluding FX impact, EBITDA increased by 9%.

 

Data revenues account for more than 55% of total revenue driven by data leadership and digital transformation initiatives across the operations, Ooredoo said.

 

Commenting on the results, Sheikh Faisal bin Thani Al-Thani, Ooredoo chairman said: “Ooredoo Group delivered a robust set of results during the first quarter of 2021 despite challenging market conditions across many of our territories. We remained focused on our digital transformation agenda which has enabled us to create value for our customers by offering a seamless and convenient user experience as well as optimise our cost base by streamlining and automating processes. Consequently, our EBITDA margin improved to 45% in Q1, 2021 compared to 41% for the same period last year.

 

“We made good progress with our strategy to move to a more efficient and flexible asset-light model with the successful sale and leaseback agreement valued at $750 million for more than 4,200 of our telecom towers in Indonesia to Edge Point Indonesia. Monetising these assets forms an integral part of our group strategy to create value for both our shareholders and customers.

 

“During the quarter, Ooredoo Group successfully priced its $1bn bond issuance, reflecting the market’s confidence in the strength and stability of our balance sheet as well as our strategy to deliver new and innovative solutions to our customers by leveraging our world class technology and infrastructure.”

 

Aziz Aluthman Fakhroo, managing director, Ooredoo said: “I am pleased to report that Ooredoo Group had a solid start to the year, despite challenging market conditions due to the Covid-19 pandemic. Ooredoo Group delivered a 6% increase in EBITDA to QR3.2bn in Q1, 2021 compared to the same period last year. The growth was driven by the ongoing implementation of our cost optimisation strategy which includes leveraging technology to drive efficiency.

 

“As a result, our EBITDA margin for the period increased to 45% in Q1 2021 compared to 41% for the same period last year, supported by margin expansion in Indonesia, Kuwait, Myanmar and Iraq.”

 

Revenues remained under pressure due to a soft macroeconomic environment in many of our markets.”

 

Ooredoo Group reported revenues of QR7.2bn during the first quarter, down 1% compared to the same period in the previous year.

 

Indosat Ooredoo continued to make strong progress with its strategy of offering simple, relevant, and transparent products supporting a 13% increase in revenue and a 36% increase in EBITDA.

 

Fakhroo said: “Ooredoo Group invests further in its infrastructure to bring world class services to its customers. During the quarter Asiacell launched 4G in Iraq and Ooredoo Oman is preparing for the launch of mobile 5G services in Q2, 2021.”

 

OOREDOO OMAN

 

Ooredoo Oman’s performance was affected by economic conditions, increasing competition in the prepaid segment and the Covid-19 impact. Revenues declined 4% to QR 610 million in Q1 2021 compared to the previous year, driven by a reduction in prepaid revenue which was partially offset by post-paid revenue gains.

 

Consequently, EBITDA declined 12% to QR 314 million during the first quarter of 2021 compared to the same period in the previous year. The company remains committed to managing its overall cost structure.

 

Ooredoo Oman’s customer base increased by 2% of 2.9 million in Q1 2021 compared to the same period in the previous year, as the company prepares to launch 5G mobile services in Q2 2021.

 

On 22 March 2021, Ooredoo Oman accepted the resignation of its CEO, Ian Dench effective as of 30 June 2021. The appointment of the new Ooredoo Oman CEO will be announced in due course.

 

OOREDOO KUWAIT

 

The Covid-19 pandemic contributed to a softening macroeconomic environment in Kuwait, impacting Ooredoo Kuwait’s performance during the period. The company’s revenues declined 8% to QR 607 million in Q1 2021 compared to the previous year. EBITDA for the period increased 2% to QR 169 million, compared to the same period in the previous year, supporting an increase in EBITDA margin to 28% in Q1 2021 from 25%.

 

Recognising the company’s long-standing commitment to its customers, Ooredoo Kuwait was awarded the “Best Internet Service Provider” at the annual Service Hero Awards for the year 2020. The company remained focused on launching new and innovative products for its customers, signing an MoU with the National Bank of Kuwait (NBK) to develop digital services, products and solutions that contribute to enriching customer experiences. Ooredoo Kuwait’s customer base in Q1 2021 was 2.4 million (Q1 2020: 2.5 million).

 

ASIACELL — IRAQ

 

The Iraqi economy was impacted by weakening purchasing power following the 17% devaluation of the Iraqi Dinar and the effect of the Covid-19 pandemic. Asiacell reported revenue of QR 852 million during the first quarter of 2021 compared to QR 1,085 million for same period in the previous year. Consequently, EBITDA declined 20% to QR 380 million in Q1 2021 compared to the same period in the previous year. The company’s cost optimisation initiatives contributed to a healthy EBITDA margin of 45% in Q1 2021.

 

Asiacell maintained its customer base of 14.6 million (Q1 2020: 14.5 million), supported the launch of 4G and new partnerships with OSN and LaLiga, enabling the company to offer bundled services and increase data usage.

 

NORTH AFRICA

OOREDOO ALGERIA

 

Ooredoo Algeria delivered a healthy set of results during the first quarter of 2021, despite a challenging macroeconomic environment. In local currency terms revenues increased 2% in Q1 2021 compared to the same period in the previous year, supported by the bundling of offers in the “My Ooredoo” App and the launch of plans targeting SOHOs and SMEs. Consequently, an EBITDA margin of 34% has been maintained.

 

In Qatari Rial terms, the company’s performance was impacted by the 9% year on year depreciation of the Algerian Dinar. Ooredoo Algeria reported revenues of QR 551 million during the first quarter of 2021 compared to QR 594 million for the for the same period in the previous year. EBITDA for the period was QR 188 million, a decline of 6% compared to the same period in the previous year. The company maintained an EBITDA margin of 34% as it focused on cost optimisation and implemented a number of initiatives including optimising spend and digital efficiencies.

 

Ooredoo Algeria’s customer base was 12.7 million in Q1 2021, up 3% compared to the same period in the previous year.

 

OOREDOO TUNISIA

 

Despite the Covid-19 pandemic continuing to impact the macroeconomic environment in Tunisia, Ooredoo Tunisia reported revenues of QR 394 million in Q1 2021, an increase of 3% compared to the same period in the previous year supported by favourable FX trends. The company remains focused on the implementation of its value creation plan which includes expanding its digital proposition and streamlining its operations through the digitisation of its sales and distribution channels.

 

The company reported EBITDA of QR 162 million in Q1 2021, down 3% compared to the same period in the previous year. The company’s focus on efficiency and cost optimisation supported a healthy EBITDA margin of 41% in Q1 2021.

 

Ooredoo Tunisia changed the reporting of its prepaid customer’s base from the original life-cycle definition to the 90 days network activity definition, to align with the standard reporting methodology used in Tunisia. As a result, Ooredoo Tunisia’s reported customer base declined by approximately 2.3 million to 6.9 million customers in Q1 2021. There is no impact on the reported financials.

 

ASIA

INDOSAT OOREDOO

 

Indosat Ooredoo reported an excellent set of results in the first quarter of 2021, maintaining the positive momentum from the previous year. Indosat Ooredoo’s revenue increased by 13% to QR 1.9 billion during the first quarter of 2021 compared to the same period last year. Growth was driven by the strong performance in cellular revenues supported by a rebound in the enterprise business.

 

Indosat Ooredoo’s EBITDA increased to QR 956 million in the first quarter of 2021 up 36% compared to the same period in the previous year, due to a combination of top line growth and cost efficiencies.

 

Supported by its strategy of offering simple, relevant, and transparent products and its network investments Indosat Ooredoo’s customer base increased 7% to 60.0 million in Q1 2021 compared to the same period in the previous year.

 

Indosat Ooredoo signed a sale and leaseback agreement with PT EPID Menara Asset Co (“Edge Point Indonesia”) for more than 4,200 telecommunications towers. The transaction is valued at $750 million and forms part of Ooredoo Group’s strategy to move to a more efficient and flexible asset-light model unlocking the trapped value of its infrastructure portfolio.

 

On April 28, Ooredoo Group extended the exclusivity period of the non-legally binding MoU with CK Hutchison to Jun 30, 2021, in relation to a potential transaction to combine their respective telecommunications businesses in Indonesia. This extension will provide more time to complete the ongoing due diligence and negotiate the final terms of a possible combination of the entities.

 

OOREDOO MYANMAR

 

Political developments in Myanmar including restrictions on mobile and wireless broadband impacted Ooredoo Myanmar’s performance in Q1 2021. The company’s priority during this period of emergency was to keep its customers connected by offering an extensive range of affordable voice products.

 

Ooredoo Myanmar reported revenues of QR 252 million during the first quarter of 2021, a decline of 11% compared to the same period last year, as restrictions impacted data revenues which were partially offset by an increase in voice revenues. The company continued to implement its cost optimisation strategy which included optimising data centres and energy consumption as well as contract renegotiations supporting a 12% increase in EBITDA to QR 56 million in Q1 2021 compared to the same period last year.

 

Ooredoo Myanmar also launched a number of initiatives to support the community including its “donate a recharge” program where customers who have an extra balance can donate it alongside Ooredoo Myanmar, which donates MMK 5 million daily to customers who need a top-up. The company’s customer base decreased by 14% to 13.4 million in the first quarter of 2021 compared to the same period last year. -- TradeArabia News Service