Zain, Kuwait's biggest telecommunications operator by subscribers, reported a 9 percent year-on-year fall in first-quarter profit on Sunday, extending an earnings slump as foreign exchange losses increased.
The former monopoly, which operates in eight countries in the Middle East and Africa, made a net profit of 37 million dinars ($123 million) in the three months to March 31, it said in a statement.
Analysts at EFG Hermes and SICO Bahrain had forecast Zain would make a quarterly profit of 39.11 million dinars and 38.4 million dinars respectively.
The firm had posted falling profits in six of the preceding seven quarters as tougher domestic competition, service interruptions and higher costs due to conflict in Iraq, and foreign exchange volatility weighed on the bottom line.
Zain said its first-quarter foreign currency losses were predominantly from Iraq and totalled $35 million, up from $7 million a year earlier.
First-quarter revenue was 277 million dinars, down slightly on 278.9 million dinars in the same period the previous year.
In Kuwait, Zain competes with Ooredoo Kuwait, a unit of Qatar's Ooredoo, and Viva, an affiliate of Saudi Telecom Co. Zain's quarterly domestic profit was 22 million dinars, down from 26 million dinars a year earlier.
The decline in profit at its Iraqi subsidiary was more severe, slumping to $3 million from $34 million over the same period, while Sudan's quarterly profit fell 28 percent to 195 million Sudanese pounds ($32 million).