While Zain has reported a 27% increase in the group's worldwide subscriber base to 69.518 million, its operations in Sub-Saharan Africa saw a combined net increase of just 9,000 in the last six months.
While Nigeria and Kenya reported a net decrease in subscribers, a number of Zain's other operations in Sub-Saharan Africa reported a "stellar" subscriber and revenue growth performance, including Tanzania, Niger, Malawi and Chad.
Zain is in talks with three international operators regarding the sale of all or part of its operations in Sub-Saharan Africa and is holding an extraordinary general meeting (EGM) today (31 August) in which it is expected that shareholders will amend limitation rules to pave the way for the arrival of a new investor.
Zain has reported a 24% increase in consolidated revenues to US$4.014 billion in the six months ending 31 June 2009 and a 27% increase in gross profit to US$2.93 billion, but only a 4% increase in net profit to US$534 million. This decrease in net profit was largely attributable to foreign-exchange fluctuations. The operator's financial statements show that "the financial crisis was evident from the currency translation impact on revenues in the African markets during the first half of 2009, notably Nigeria where the weakening of the naira had a US$160-million negative impact on reported dollar figures".
Zain’s African operations account for 59% of the group’s total: the Middle East region saw a 63% annual growth rate and Sub-Saharan Africa saw a 23% growth rate. While Zain’s 16 operations in Sub-Saharan Africa reported a 23% annual increase in subscribers to 41.027 million from 33.301 million in June 2008, the region only saw a net increase of just 9,000 subscribers in the last six months from 41.018 million in December 2008. Although most operators continued to see strong subscriber growth—particularly Malawi (66%), Niger (58%), Tanzania (57%) and Chad (56%)—Nigeria and Kenya reported a net decrease of 3.212 million (Nigeria 2.551 million and Kenya 661,000) due primarily to an adjustment to the definition of "active" subscribers in Nigeria.
