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Company records net profit of KD 32.1mn; Board proposes cash dividend of 60 fils per share
KUWAIT CITY, Feb 3: Kuwait Telecommunications Company (stc), a world-class digital leader providing innovative services and platforms to customers and enabling the digital transformation in Kuwait, announced its financial results for the financial year ended 31 December 2020. stc highlights the financial and operational performance in addition to the social initiatives that the company took during the year 2020 amid COVID-19’s difficulties, challenges and negative economic consequences affecting most companies within various sectors. Commenting on the announcements of these results, Dr Mahmoud Ahmed Abdulrahman, stc’s Chairman, stated: “2020 was an unusual year that is radically different from previous years in terms of the external events associated with the COVID-19 pandemic. In addition to the ongoing internal development processes which have resulted in a significant transformation of stc’s operational activities in line with company’s digital transformation strategy”.
As for the overall performance of the telecommunications sector, Dr Abdulrahman added: “On a local, regional and global level, the telecommunications sector is witnessing drastic changes in terms of enhancing the digital services and business solutions in addition to providing advanced as well as diversified Information and communication technology (ICT) packages aimed at enhancing company’s operational and financial performance”.
He pointed out: “Despite the continuing negative repercussions of the current economic crisis associated with the COVID-19 pandemic, which affected most sectors on a global level, we are optimistic about the future of business, and we are; therefore, constantly seeking to renew and innovate everything we offer our customers with in addition to our keen to expand easy and accessible communication channels to provide better and faster services”.
Dr. Abdulrahman commented on stc’s social initiatives since COVID-19’s outbreak: “During 2020, stc was keen 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”.
He also stated: “Throughout the year, stc has collaborated with some governmental agencies and medical companies on ways to prevent the infectious diseases in addition to undertaking a number of precautionary measures and procedures for prevention in accordance with the health guidelines and instructions provided by the Ministry of Health. stc has also adopted the best safety standards and instilled them in the culture of performance of its employees to provide high quality services consistent with the required measures that were predefined to protect its customers and employees.
stc has also continued providing social activities targeting several sectors, including sports, education and health, with the aim of leaving a social impact in Kuwait. In addition to its leading role in providing integrated, advanced and innovative digital as well as technology solutions for individuals and enterprises throughout the COVID- 19 outbreak, stc has been able to achieve these results by adopting a flexible operating model in addition to being flexible in implementing the company’s digital transformation strategy and providing integrated advanced technical solutions that serve the Kuwaiti government’s outlook with regards to the social distancing for the individual and enterprise segments.
Capitalizing on the 5G network, stc was able to provide a range of digital services, which have become a major part of the Kuwaiti society’s daily activities. Furthermore, stc was also able to meet the growing demand for high-speed wide broadband networks following the latest governmental decisions with regards to pursuing the current academic year through online platforms. Not to mention company’s digital and cloud computing services designed to better serve the latest corporate directions”.
Commenting on the stc’s financial position as of December 31, 2020, Dr Abdulrahman said: “Company’s total assets reached KD 374.2 mn at the end of 2020, while the total shareholders’ equity increased by 3.2% reaching KD 222.2 mn. As a result, the book value per share reached 445 fils. Moreover, the company has a strong solvency position among its peers in the Middle East. stc’s Board of Directors has recommended distributing cash dividends to respective shareholders of 60 fils representing 60% of the share’s nominal value for the year ended 2020, subject to the approval of the Ordinary General Assembly of the company.
This decision was driven by stc’s confidence in the evolution of its business, its strong financial position and the ongoing cash flow generation during economic downturns.” Commenting on the announcement of company’s financial results for the year ended December 31, 2020, Eng Maziad bin Nasser Al Harbi, stc’s CEO, stated: “Despite the worldwide economic challenges associated with the COVID-19 pandemic and the strong competition in the Kuwaiti telecommunications market, stc has managed to achieve good levels of revenues and enhance its operational efficiency to add value to its customers and achieve better returns to its shareholders. stc has also demonstrated its ability to overcome potential challenges and potential risks while keeping up its business operations and serve customers during such circumstances.
stc was able to achieve the above mentioned results due to the great efforts provided and the dedication of its employees, who demonstrated their determination to address the health risks we experienced from COVID-19’s outbreak. This was the main reason, which helped the company to continue providing services to its customers with the same quality standards despite the growing demand and the convergence of the communications with customers and customer delivery services to the digital platforms”.
Al Harbi added: “Consequently, stc has been able to achieve good financial results that meet the aspirations of company’s shareholders during the unprecedented and unstable situations where the total revenue reached KD 283.2 mn in 2020, compared to KD 293.7 mn last year. This decline is attributed to the total and partial lockdown imposed in Kuwait due to COVID-19, resulting in a decline in the sales revenues of the consumer sector, as well as a significant and almost a total decline in the roaming services revenues as a result of the closure and suspension of flights at most airports worldwide. stc’s social contributions that we are proud of have also contributed to the decline in company’s revenue, where customers have been provided with unlimited free local calls for all mobile networks, in addition