Zain, Kuwait’s No 1 telecom operator by subscribers, reported an 18% fall in third-quarter profit yesterday, extending a sustained earnings slump as increased taxes in Iraq and foreign exchange losses weighed on the bottom line.
The former monopoly, which operates in eight countries in the Middle East and Africa, made a net profit of 38mn dinars ($125.50mn) in the three months to September 30, down from 46mn dinars in the year-earlier period, it said in a statement.
Two analysts polled by Reuters had forecast Zain would make a quarterly profit between 37.0mn dinars and 46.1mn dinars.
The firm had posted falling profits in 10 of the preceding 12 quarters, partly due to tougher domestic competition, service interruptions and higher costs in war-torn Iraq and foreign exchange volatility.
Zain said a 20% sales tax on mobile services in Iraq, introduced on August 1, had hurt its third-quarter profit.
Third-quarter revenue was 292mn dinars. This compares with 294mn dinars a year ago.
Zain’s net profit in the first nine months of 2015 was 118mn dinars, down 27% from a year earlier.
The operator said foreign exchange losses as a result of a stronger dollar versus the dinar had reduced its profit for this period by $25mn, while the amortisation of recently acquired radio spectrum in Jordan and Iraq had also impacted its bottom line.
In Kuwait, Zain competes with Ooredoo Kuwait, a unit of Qatar’s Ooredoo, and Viva, an affiliate of Saudi Telecom Co (STC).

Union National Bank
Union National Bank, 50% owned by the Abu Dhabi government, posted a 12.4% fall in third-quarter net profit yesterday, missing analysts’ forecasts because of loan impairments and lower investment income.
The fifth-largest lender on the Abu Dhabi exchange by assets reported a net profit attributable to equity holders of 480.59mn dirhams ($130.9mn) for the three months to September 30, down from 548.68mn dirhams a year earlier, a bourse filing showed.
Four analysts polled by Reuters had forecast an average a profit of 541.8mn dirhams for the quarter.
The bank reported a nine-month net profit of 1.66bn dirhams compared with 1.57bn dirhams in the comparable period last year.
UNB’s net interest income grew to 770.3mn dirhams in the third quarter versus 686.5mn dirhams in the prior-year period.
But impairments booked were 199.8mn dirhams compared to 126.9mn dirhams. Also, net investment income fell to 7.6mn dirhams from 28mn dirhams.
Loans and advances increased to 68.6bn dirhams on September 30 from 64.1bn dirhams in December last year, while deposits grew to 73.2bn dirhams from 67.4bn dirhams.

Arab Bank
Jordan’s largest lender, Arab Bank Group, said its January-September net profit came to $615.1mn, barely changed from $614.2mn in the same period last year.
It said its loans book and customer deposits had continued to grow despite exchange-rate fluctuations.
One of the Middle East’s major financial institutions, Arab Bank Group said on Saturday that its total loans rose 2% to $23.6bn as of the end of September, while deposits had grown 5% to $34.8bn compared with the same period last year.
The bank, with a balance sheet of $46.4bn, gave no figure for net profit in the third quarter alone.