Driven by its ambitious digital transformation strategy, Ooredoo Group posted a net profit of QR1.7bn in 2019, up 10% on the previous year.
Reported group revenue was stable at QR29.9bn, “in spite of the industry wide shift from voice to data consumption, a reduction in handset sales as well as macroeconomic and currency weakness in some of our markets.”
The growth in Ooredoo’s profit was driven by an increase in EBITDA, a more favourable foreign exchange environment compared to 2018, which was partially offset by a negative IFRS16 impact on the net profit, the company announced last night.
Ooredoo Qatar, Kuwait, Tunisia, Iraq and Indonesia performed well. Furthermore, Ooredoo Indosat’s profit benefited from the sale of 3,100 towers.
The company’s board of directors has recommended the distribution of a cash dividend of QR0.25 per share. Additionally, the board approved a sustainable and progressive dividend policy for the company, aiming for a dividend payout in the range of 40% to 60% of normalised earnings.
The group’s customer base stood at 117mn in 2019, up 2% compared to 2018, mainly driven by new customers in Indonesia, Myanmar and Kuwait.
Ooredoo Group leads in 5G adoption with live commercial 5G networks in Qatar and Kuwait as well as successful 5G testing in Oman.
Ooredoo Qatar applied 5G technology during the FIFA Club World Cup Final in December 2019 in Doha with “excellent” coverage and network quality.
On the results, Ooredoo Group chairman HE Sheikh Abdulla bin Mohamed bin Saud al-Thani said, “In 2019 we made good progress with the execution of our ambitious digital transformation strategy, transforming our core user experience online and making it easier for our customers to find and use our services. We continued to invest in our state-of-the-art network, as well as introducing and enhancing 5G services in key markets to support the next generation of digital services.
“Testament to the success of our strategy is that more than 50% of Group revenues now come from data, which is an important milestone for a telecommunications company that continues to evolve and develop.
“Our internal change programme is also aligned with our digital transformation strategy, and encompasses every aspect of our operation, from talent management to sales, marketing and customer care, enabling us to further optimise our cost base while ensuring a user experience that enhances the digital lives of our customers.
“Importantly, our strategy enabled us to deliver a strong financial performance in 2019, with reported net profit attributable to shareholders up by 10% to QR1.7bn. Therefore, I am pleased to announce that the Board of Directors will recommend the distribution of a cash dividend of QR0.25 per share at the annual general meeting in March. Our Board approved a sustainable and progressive dividend policy for the company, aiming for a dividend pay-out range of 40% to 60% of normalised earnings.”
Ooredoo Group CEO Sheikh Saud bin Nasser al-Thani said, “Ooredoo Group delivered a strong set of results in 2019, against a backdrop of an evolving telecommunications industry. Our success was driven by the precise execution of our digital transformation strategy, in concert with the culture of innovation which permeates Ooredoo Group. This enabled us to remain agile and meet the changing needs of our customers.
“Group revenue was stable at QR29.9bn in 2019, in spite of the industry wide shift from voice to data consumption, a reduction in handset sales as well as macroeconomic and currency weakness in some of our markets.
Throughout the year, we made significant productivity improvements as we digitised our processes and optimised our cost base. EBITDA for 2019 was QR12.8bn, an increase of 5% compared to the previous year. Similarly, our EBITDA margin improved to 43% in 2019, compared to 41% in the previous year driven by improvements in Qatar, Kuwait, Tunisia, Indonesia and Maldives.
“Our strategy in Indonesia supported a strong recovery in Indosat Ooredoo’s financial performance which delivered revenue growth of 14% and EBITDA growth of 47% in 2019, compared to the previous year. Our digital distribution strategy in Myanmar was well received by the market and supported an expansion in Ooredoo Myanmar’s user base by 20%.
“An optimised product mix and careful cost management contributed to a 31% growth in Ooredoo Kuwait’s EBITDA, despite competitive market pressures,” Sheikh Saud said.