– Mazyed Al-Harbi: “stc” strengthened its position as the second largest telecommunications company, with 35 percent of the sector’s revenues
We have implemented advanced plans to ensure business continuity and enhance profitability with a balanced policy
Kuwait Telecom Company (stc) announced its results for the fiscal year ending on December 31, 2020, indicating that it achieved a net profit of 32.1 million dinars, with a profit of 64 fils per share.
Revenues amounted to 283.2 million dinars, while earnings before interest, taxes, depreciation and amortization reached 73.4 million.
Assets totaled 374.2 million, shareholders’ equity 222.2 million, while the book value per share reached 445 fils, in addition to the customer base reaching 1.9 million customers.
The company’s board of directors recommended distributing cash dividends to shareholders at the rate of 60 fils per share, which represents 60 percent of the nominal value of the share for 2020, provided that this recommendation is subject to the approval of the Ordinary General Assembly. This decision was based on the confidence of “stc” in the development of its business and the durability. Its financial position and continued cash flow during economic recessions.
The Chairman of the Board of Directors of the company, Dr. Mahmoud Ahmed Abdel Rahman, said that 2020 was decisive and radically different from other previous years in terms of external events due to what was left by the “Covid-19” epidemic, in addition to the continuous internal development processes that resulted in a noticeable change in activities. Operational, in line with the strategy to enable digital transformation.
Abdul Rahman added that the local, regional and global telecommunications sector is witnessing radical transformations in terms of developing digital services and business solutions, in addition to providing advanced and diversified packages of information and communication technology, in order to enhance its operational and financial performance.
He pointed out that despite the continuing negative repercussions caused by the current economic crisis due to “Corona” in the world in most sectors, the company is optimistic about the future of business, and it always strives towards renewal and innovation in everything it offers to customers, and expanding easy and accessible communication channels to provide Better and faster service.
He stressed the company’s keenness in 2020 to support all segments of Kuwaiti society, by launching a series of social initiatives that include supporting the country’s preventive activities in the field of health, safety and social awareness, noting that it cooperated with some government agencies and medical companies in the matter of ways to prevent infectious diseases.
He pointed out that several precautionary measures and measures have been taken for the purpose of prevention in accordance with health guidelines and instructions, and that they adopt the best safety standards and instill them in the culture of performance of its employees, to provide high-quality services consistent with the procedures to protect its customers and workers.
Abdul Rahman stated that “stc” continued to provide social activities targeting several sectors, including sports, education and health, with the aim of leaving an influential social impact in Kuwait.
He revealed that the company maintained its leadership in providing integrated, advanced and innovative digital and technical solutions to individuals and companies alike throughout the outbreak of the new Corona virus, and was able to achieve these results by adopting a flexible operating model, in addition to its flexibility by implementing the company’s strategy for digital transformation and providing integrated technical solutions. In a way that serves the government’s orientations regarding the social distancing of individuals and companies.
Abdul Rahman pointed out that stc is keen to make use of the fifth generation network to provide a range of digital services, which have become a large part of the daily activities of the Kuwaiti society, and that it has been able to meet the increasing demand for high-speed broadband networks in the wake of the latest government decisions related to following the year. Current studies, through online platforms, in addition to companies’ orientation to digital and cloud solutions.
“The company’s total assets amounted to 374.2 million dinars at the end of 2020, and the total equity of our shareholders rose 3.2 percent to 222.2 million dinars, and the book value per share reached 445 fils.”
For his part, the CEO of the company, Mazyad bin Nasser Al-Harbi, said that despite the economic challenges that the world witnessed due to the emerging “Corona” and the strong competition in the Kuwaiti telecommunications market, “stc” was able to achieve good levels in revenues and enhance operational efficiency to create added value. For its customers and better returns for its shareholders.
He added that the company has demonstrated its ability to overcome potential challenges and risks, keep up with operational business, and open its doors in order to serve customers in these circumstances, thanks to the great efforts and dedication of its employees who have demonstrated their determination and determination in facing health risks due to the spread of the epidemic.
And he indicated that this resulted in the company continuing to provide its services to customers with quality standards despite the increasing demand, and the shifting of communication with the customer to digital platforms and customer delivery.
Al-Harbi added that “stc” was able to achieve good financial results that meet the aspirations of its shareholders in light of unstable and unprecedented conditions, as total revenues reached 283.2 million dinars in 2020, compared with 293.7 million 2019, referring to the reason for this decline to the total and partial ban measures due to “Corona” », Which resulted in a decrease in retail sales revenues, as well as a significant and almost total decline in roaming services revenues, as a result of the closure and suspension of travel flights at most airports in the world, in addition to the decline resulting from the social contribution.
He noted that “stc” has provided its customers with unlimited free local calls to all mobile phone networks, in addition to an internet package with a capacity of 5 GB per day from March 22 to April 20, in cooperation with the Public Authority for Communications and Information Technology (CITRA), in support of society during Corona.
Al-Harbi pointed out that the financial results reflect its ability to compete and strengthen its position as the second largest telecommunications company in terms of its market share of the Kuwaiti sector’s revenue by 35 percent.
Integrated technology solutions
Al-Harbi pointed out: “stc” has achieved these results thanks to the implementation of the digital transformation strategy and the provision of integrated technical solutions to individuals, private companies and government sectors, and pushing its business into new areas of sustainable growth, through a series of innovative initiatives aimed at improving the level of operational efficiency and improving customer experience. And to provide the best services and products that meet the needs of its customers in light of the Corona crisis and the requirements that resulted from it, as well as to support the business through the company’s advanced infrastructure with the best and broadest coverage of the fifth generation network.
He revealed that the company is working to activate a balanced policy to reduce costs, to reach the best results, and to enhance profitability by adopting effective financial plans at the level of operational and capital expenditures, noting that it was able to restructure capital expenditures, especially after the negative effects of the current economic crisis, to ensure the liquidity of flows Cash under current conditions.
And he indicated that the last year witnessed the launch of “stc” many offers and services that are in the interest of individual and corporate customers, and the launch of the new brand of its subsidiary, “Qualitynet”, to become “solutions by stc”, its arm specialized in providing integrated business sector solutions.
Al-Harbi pointed out that the company’s financial results reflect its ability to compete and strengthen its position as the second largest telecommunications company in terms of its market share of the volume of revenues in the Kuwaiti telecommunications sector by up to 35 percent.
The consequences of “Corona”
The financial results were significantly affected during 2020 as a result of “Corona” and the negative consequences that came with it for most companies, which formed great pressure on business movement and led to a decline in collected revenues, and then decreased profitability levels by 2020.
The high level of expected credit losses for trade and other debit balances, and contract assets from 17.9 percent to 15 million dinars in 2020, had a significant impact on income before interest, taxes, depreciation and amortization, reaching 73.4 million, compared to 83.8 million during 2019.
The EBITDA margin was 26 percent in 2020, compared to 29 percent in the previous year.