Ooredoo Reports Revenue of QAR 33 billion and More Than 107million Customers Net Profit of QAR 2.1 billion

Data Revenue Represents 25%of Group Revenue

Board of Directors Recommends a Cash Dividend of 40% of Nominal Share Value

Doha, Qatar, 10 March 2015: Ooredoo Q.S.C. (“Ooredoo”)-Ticker: ORDS.QA today announced results for the year ended 31 December 2014.

Financial Highlights:

Earnings per share in FY2014 stood at QAR 6.66(FY2013: QAR8.05)

 Number of customers increased by 12% to reach 107 million, driven by the Indonesian, Iraqi, Kuwaiti, Myanmar and Algerian markets

 FY2014 Group revenue down by 2% to QAR 33.2 billion; strong performances in Qatar, Oman and Algeria; challenging market conditions in Iraq, Kuwait, Tunisia and Indonesia

EBITDA of QAR 12.9 billion and EBITDA margin of 39% reflect Ooredoo’s continued strategic investment into its broadband networks, global brand roll-out and customer acquisition costs.  In addition, aggressive price competition in Iraq, Myanmar start-up costs, Indonesian currency depreciation and the Iraqi security situation also affected EBITDA and EBITDA margin.  Excluding the impact of Indonesian Foreign Exchange, Myanmar start-up  costs  and  one-off  customer  acquisition  costs  in  Algeria, EBITDA  would  have  decreased  by  5% compared to the reported 12% reduction.  Excluding these three items, Net Profit to Ooredoo shareholders for the FY 2014 would have decreased by 8% and for Q4 2014by 22%.

FY  2014  data revenue represented 25%  of  Group revenue due  to Ooredoo’s  strategy  to  increase  smart phone penetration, deliver innovative new bundles and data offers for customers

Group B2B revenue amounted to more than QAR 4.5 billion for FY 2014;B2B customer numbers up 25%

Ooredoo Myanmar launched commercially in August 2014; by 31 December 2014 it had gained 2.2 million customers. More than 80% of customers are using smart phones, generating strong ARPUs with high data revenue contribution

Asiacell secured a 3G licence in December 2014 and launched 3G services in January 2015

Ooredoo  global  brand  now  adopted  by  seven  Ooredoo operators:  Qatar,  Algeria,  Maldives,  Tunisia, Myanmar, Kuwait and Oman

Board of Directors recommends a Cash Dividend of 40% of Nominal Share Value.

Commenting on the results, His Excellency Sheikh Abdulla Bin Mohammed Bin Saud Al-Thani, Chairman of Ooredoo said:

“Ooredoo is rapidly positioning itself at the heart of the digital future of our customers. Mobile infrastructure is an essential enabler of a country’s economic prosperity, particularly in developing markets. Our financial results for 2014, despite the challenges we have faced in some of our markets, demonstrate how Ooredoo is increasingly playing its role in supporting the economic growth in our markets. Our networks, services and investments in to new growth opportunitiesin Myanmar and next generation networks in Iraq, Qatar and Algeria all demonstrate the  transformative  power  of  Ooredoo for  our customers  and  their  communities. These  investments into new technologies and future business will ultimately benefit our shareholders as well. On behalf of the Board of Directors, I am pleased to recommend to the General Assembly the distribution of a cash dividend of 40 percent of the nominal share value (QAR 4 per share).”

Also commenting on the results Dr. Nasser Marafih, Group Chief Executive Officer of Ooredoo said:

“Ooredoo  made  significant  progress against its strategy during  2014 despite facing sustained, high  levels of competition, adverse currency movements and the current security situation in Iraq. We continue to invest in our infrastructure to target market leadership by offering the best network experience. Data revenue continues to grow and now represents a quarter of Group revenue. The acceleration of our strategy execution during 2014 puts Ooredoo in a good position to generate and capture value for our shareholders and our more than 107 million customers.”

Financialand Strategy Review

As of 31 December2014, the Group’s consolidated customer base stood at 107 million (FY 2013: 96 million), representing year-on-year growth of 12%. Group revenue for the twelve months 2014 decreasedby 2% to QAR 33,207 million  (FY 2013:  QAR 33,851 million). Group  EBITDA stood  at QAR 12,948 million  (FY 2013: QAR 14,640 million)  with  EBITDA  margin  decreased to 39%  (FY 2013: 43%)  due  to the continued strategic investments across the business into broadband networks, customer acquisition and retention, global brand roll-out, service launches and customer experience. Net profit attributable to Ooredoo shareholders for 2014 was QAR 2,134 million (FY 2013: QAR 2,579 million).

Ooredoo’s strategy to become a data-centric business made significant progress following the investment the business has made in its broadband networks, data infrastructure, driving smart phone penetration and creating innovative  new  bundles  and  data  offers for  customers. Group  data  revenue now represents 25%  of  group revenue.  The growth  in  data  revenue  reflects  the growing  adoption  of  data-based  services, enabled  by  the pervasiveness of Ooredoo’s ultra-fast broadband networks. Ooredoo now has 4G deployed across five out of its nine  markets. Algeria,  Iraq,  Qatar  and  Tunisia are  all  markets  where  Ooredoo is  the  market  leader  in data customer share. Ooredoo is also rolling out service agreements with OTT players to drive and capture a growing share of data revenue in its markets. Ooredoo generated strong revenue growth from its B2B strategy, which targets  the  communication  needs  of  the  businesses  in its markets, with  more  than  QAR 4.5 billion of  B2B revenues and B2B customers increasing by 25% during the year. Ooredoo invested in technology modernization across its global footprint during the year to enhance its customers’ experience and to create cost synergies.

Operational Review

Middle East

Ooredoo Qatar Ooredoo Qatar delivered strong growth across its network during the year. Revenue grew by 8% to QAR 7,148 million (FY 2013: QAR 6,590 million) and customers grew by 10% to3.2 million.  The growth in revenue was driven by mobile services, broadband, mega-projects and device sales.  EBITDA increased by 5% to QAR 3,448 million compared to the previous twelve months.  Net profit for FY 2014 increased by 40% to QAR 1,919 million (FY 2013: QAR 1,374 million) due to higher EBITDA and sale of investments.

Ooredoo  Qatar  continued  to  pursue  an  ambitious  programme  of  network enhancement,  becoming  the  first operator in the Group to launch 4G+ in December 2014, offering speeds of up to 225 Mbps, almost double the average 4G speed. In addition, Ooredoo Qatar had more than 200,000 fibre customers by December 2014 and undertook  a  fibre  speed  upgrade  programme.  By  offering  the  biggest,  fastest  fixed and  mobile  networks, supported  by  a  diverse  range  of  “smart”  prepaid  and postpaid  services,  Ooredoo  Qatar  is  able  to  meet  the nation’s rising demand for data services and protect its market-leading position.

An enhanced focus on business-to-business services also delivered significant returns. The company used its role as the organiser of the ITU Telecom World 2014 conference in Qatar to showcase a new range of “smart services” for local and international organisations, including smart stadium technology, smart health solutions, smart traffic management  services and smart city management and network facilities. Given Qatar’s dynamic development programme, Ooredoo is well-positioned to be a leading partner for a wide range of mega-projects and new residential areas in the coming period.

Ooredoo Oman

Ooredoo  Oman’s programme  of  network  investment continued  to  deliver  strong growth  across  the  business.  Revenue growth of 12% for the FY 2014 (QAR 2,231 million) was driven by strong growth of mobile and fixed data revenues, international voice revenue and value added service revenue, offset partially by a decline in SMS revenue. EBITDA also increased by 20% to QAR 1,115 million compared to FY 2013 due to revenue growth and lower cost of sales partially offset by higher operational expenditure. Net profit increased by 5% to QAR 329 million compared to the FY 2013.  Total customers grew by 8% to 2.6 million compared to the FY 2013 driven by the demand for broadband and data services offered by Ooredoo Oman’s market-leading broadband network. Ooredoo  Oman  became  the  seventh  operator  to  re-brand  to  Ooredoo’s  global brand  in Q4 2014.

 

Ooredoo Kuwait

Ooredoo's customer base in Kuwait was 2.5 million at FY 2014, an increase of 25% overthe same period in 2013. Revenues for 2014 were QAR 2,149 million, a decrease of 14% compared to 2013 revenues of QAR2,500 million. EBITDA was QAR 473 million versus EBITDA for 2013 of QAR 667 million (-29%). Net Profit was QAR 189 million, compared to Net Profit for FY 2013 of QAR 190 million.

Kuwait’s  market  share  increase  was  driven  by a  range  of  new  data-based  services and  bundles, pricing strategies and retail shops, all supported by the appeal of Ooredoo’s global brand.  On a quarterly basis, revenue and EBITDA increased compared to Q3 2014, with revenue increasing by 2% to QAR534 million and EBITDA up by 24% to QAR 132 million as Ooredoo generated growing revenue from an increasing customer base.

Asiacell - Iraq

Asiacell substantially grew its customers during the year, increasing by 15% to 12.3 million compared to 10.7 million  at  FY  2013.    Customers  were  attracted  by  Asiacell’s market-leading  network coverage  and quality following  investments  made  during 2014. Asiacell faced  the  challenge  of  the growing  security  issue  in  the country during the year, in addition to the heightened levels of competition in the market. Consequently, revenue for FY2014 was QAR 6,298 million (FY 2013: QAR 7,071 million), a decrease of 11%; EBITDA was down by 19% to QAR 2,939 million and EBITDA margin was reduced to 47% from 51%. Net Profit stood at QAR 1,031 in 2014 (QAR 1,734 in 2013).

Asiacell continues to operate Iraq’s strongest network with the best coverage although continuity of service in some areas was affected during 2014. Strategic initiatives focused on data revenue and the B2B market. Data initiatives implemented during the year generated strong growth in data revenue in advance of the launch of 3G.  Asiacell’s  B2B customer  base  increased  significantly  during the  year. The  company continued  to focus on  a number of cost efficiencies.  Asiacell monitors the political situation carefully and has a range of  contingency plans in place to ensure the continued operation of the business.

North Africa

Ooredoo Algeria

Ooredoo’s customer base in Algeria at FY 2014 was 12.2 million customers, an increase of 28% compared to last year. Revenues for 2014 were QAR 4,623 million, an increase of 19% compared with revenues of QAR 3,884 million  for  2013.  EBITDA  for  2014  was QAR 1,481 million,  a  decrease  of  6%  on QAR 1,583 million  for the previous year. 2014 EBITDA was impacted by customer acquisition investments including handset subsidies to acquire 3G market share. Net Profit in2014 was impacted by lower EBITDA, FX losses and stood a tQAR 228 million compared to a Net Profit of QAR 733 million for 2013.

Ooredoo Tunisia

Ooredoo’s Tunisia customer base at FY 2014 stood at 7.6 million customers, an increase of 3% compared to 2013. Revenues  for  2014  were QAR 2,288 million,  compared  to revenues  for  2013  of QAR 2,504 million (decrease  of 9%). EBITDA  was QAR 1,072 million  compared  to QAR 1,310 million  for the  previous year representing a decrease of 18%, which partially resulted from one-off restructuring costs in Tunisia. Net Profit stood at QAR 299 million a decrease of 44% when compared with QAR 538 million for 2013.

Asia

Indosat – Indonesia

Indosat’s revenue decreased by 12% to QAR 7,395 million (FY 2013: 8,371 million) due to Foreign Exchange impact. Revenue in local currency was up 1%, driven by the growth in wireless revenues as Indosat launched a range of new  data services and bundles.  Digital content also delivered strong growth during 2014.  EBITDA decreased by 15% to QAR 3,279million (FY 2013: QAR 3,862 million) due to FX impact, increased costs of sales and operational expenditure. Indosat’s EBITDA margin decreased to 44% compared to 46% for FY 2013. In local currency terms EBITDA  decreased  by 3%. Net lossfor  the periodwas  QAR  (564) million (2013: QAR (850) million), impacted by adverse currency movements as well as a one-off provision for a legal court case (IM2). Indosat continued to invest in rolling out its broadband network, bringing Ooredoo’s world-leading data-based products and services to a greater percentage of the population.  

Indosat completed its network modernisation  during the year with U900 activated in the Ex-Java area. Data traffic has shown consistent growth across the modernised areas of the network. Faster networks drove growth of data ARPU across Indosat’s network during the period and supported customer growth from 60 million (FY 2013) to 63 million (FY 2014).

Ooredoo Myanmar

Ooredoo Myanmar generated revenue of QAR 189million and EBITDA of QAR (357) million.  Net lossstood at QAR (531) million, reflecting the continued roll-out in Ooredoo’s newest market. Ooredoo Myanmar launched its service in August 2014 as the first international operator to begin commercial operations.  Within three weeks of launch, Ooredoo had attracted 1 million customers to the country’s first next-generation U900 datanetwork.  By the end of 2014, Ooredoo Myanmar had 2.2 million customers, with more than 80% of them using smart phones.  Ooredoo’s network covered more than 25 million people by the end of 2014, covering the main cities and half of all townships. Ooredoo customers are consuming growing levels of services, driven by strong customer service and superior network quality. Ooredoo Business Myanmar was also launched in the year to deliver products and services to Myanmar’s burgeoning commercial sector.
Ooredoo will publish its full year 2014 financial statements on its website, accessible at: http://www.ooredoo.com.