Kuwait Telecommunications Company (stc), a world-class digital leader providing innovative services and platforms to customers enabling the digital transformation in Kuwait, held its Ordinary General Assembly (AGM) and Extra-Ordinary General Assembly (EGM) at the Company’s Headquarters – Olympia Mall / West Office Towers on Wednesday 23 March 2022, where the attendance represented 77.2% from the total shareholders. The AGM & EGM were held virtually using the online platform provided by Kuwait Clearing Company.
The AGM approved the Board of Directors’ and Financial Position’s report, the Auditors’ report and the Sharia Committee’s report for the fiscal year ended on 31 December 2021. The AGM also approved the Audit Committee report and the Corporate Governance report including the Board of Directors’ and the Executive Management’s remuneration and benefits report for the year ended on 31 December 2021 besides approving all the other items in the AGM agenda. The AGM also approved the Company’s financial statements and the Board of Directors’ recommendation to distribute cash dividends of 60 Kuwaiti fils, representing 60% of the share’s nominal value for the year ended 2021, on the Record Date, Thursday 21 April 2022.
The AGM also approved the Board of Director’s recommendation to distribute 100% bonus shares of the issued and paid-up capital through issuing 499,366,852 new shares to be distributed as bonus shares to shareholders registered in the company’s shareholder register, as at the end of the due day scheduled therefor on Thursday, April 21, 2022, in proportion of their respective shares and at the rate of one share for each share. Accordingly, The EGM approved increasing the company’s issued and paid-up capital from KWD 49,936,685.200 to KWD 99,873,370.400 resulted from the distribution of bonus shares.
Commenting on the announcements of these results, Dr. Mahmoud Ahmed Abdulrahman, stc’s Chairman, stated: “2021 was a year full of operational and financial achievements for stc, in spite of the stiff working environment imposed by the COVID-19 crisis on the Kuwaiti telecommunications market, which in turn demonstrated its resilience and flexibility in addressing economic risks. stc has also updated its business model and strategy to meet the continuous and massive growth in the digital communications services. Accordingly, stc is committed to provide integrated technical solutions and corporate database solutions that would enable as well as support the economic and social recovery process of the COVID-19 crisis. This would, in turn, enhance stc’s operational and financial performance, with the aspiration to achieving an outstanding performance in the coming periods”.
He pointed out: "Despite the continuing negative repercussions of the current economic crisis due to the COVID-19 pandemic, which affected most sectors on a global level, we are optimistic about the future of businesses. Therefore, we constantly seek to provide our customers with new and innovative products and services in addition to expanding as well as developing easy and accessible communication channels that would enable us to provide better and faster services and enrich their customer experience. stc has also greatly ensured providing integrated, advanced and innovative digital as well as technology solutions for both individuals and enterprises. Whereby, stc has been able to achieve these results by adopting a flexible operating model besides being flexible in implementing the company's digital transformation strategy. Not to mention stc’s keenness to provide integrated advanced technical solutions to serve the Kuwaiti government's outlook with regards to the social distancing protocols imposed on the individual and enterprise segments”.
Commenting on the stc’s financial position as of December 31, 2021, Dr. Abdulrahman said: "Company's total assets reached KD 393.8 mn at the end of 2021, while the total shareholders' equity increased by 7% reaching KD 237.2 mn. Moreover, the company has a strong solvency position among its peers in the Middle East.
Dr. Abdulrahman commented on recommended cash dividends distribution: “These distributions are considered amongst the highest in the region in light of the continuous repercussions of the COVID-19 crisis and the arising concerns about maintaining the liquidity levels. However, stc has demonstrated its capacity by maintaining good cash flows resulted from adopting its successful business model as well as financial planning that ensure good financial returns and results that would enable the company to distribute sustainable cash dividends on an annual basis, and in the best interest of the company's valued shareholders”.
Commenting on stc’s most important achievements in 2021, Eng. Maziad Ben Nasser Al Harbi, stc’s CEO, stated: “2021 was an exceptional year across all the standards, due to the company’s refreshed strategy and the dedication of its employees to deliver their best in order to achieve company’s desired goals, meet the individuals and enterprise customers’ needs, as well as creating an added value and achieve better returns for its shareholders. In this regard, the digital transformation strategy that was developed and implemented by stc over the past few years has also been a key success factor that helped the company in its many contributions to the local economy, government initiatives and the growing demand for digital solutions and information technology.
In addition to our numerous successful achievements that reflect the company's position as a leader in telecommunications and digital solutions sector, this year, stc has made a major breakthrough in obtaining the approval from the Communication and Information Technology Regulatory Authority’s (CITRA) to launch the first-of-its-kind mobile virtual network operator (MVNO) license to launch Virgin Mobile Kuwait in partnership with Virgin Mobile Middle East & Africa. Through this license, Virgin Mobile Kuwait will be able operate using stc’s network, with stc acting as a Host Facilities Based Provider “FBP” with Virgin Mobile Kuwait, offering prepaid plans to users, which makes it the first company to provide a virtual telecommunications service in the country.
In line with the company’s corporate strategy which focuses on expanding its activities and shifting from the traditional telecommunication services to the digital services as well as the advanced integrated communications information solutions and advanced technical solutions, throughout the beginning of 2022, stc is now in the process of completing its acquisition to the entire share capital of e-portal Holding Company and its subsidiaries. This acquisition of e-portal, one of the most prominent ICT companies, would enhance stc’s internal ICT capabilities to cope with the recent rapid global digitization process”.
Commenting on the announcement of company’s financial results for the year ended December 31, 2021, Eng. Maziad bin Nasser Al Harbi, said: “stc was able to achieve good financial results that meet the aspirations of the company's shareholders during the current circumstances and intense competition. Whereby, stc’s total revenue grew by 4.6% to reach KD 296.3 mn in 2021, compared to KD 283.2 mn last year. This increase is mainly attributed to the services and smart packages that are created to meet most of the individual sector’s needs, in addition to the growth in the enterprise sector through the implementation of the digital transformation strategy and providing integrated technical solutions to the private and government sectors. stc also ensured pushing its business into new areas of sustainable growth through a series of innovative initiatives aimed at upgrading the operational efficiency and delivering the best in-class services and products that cater to customers’ needs and meet their anticipations in light with COVID-19 crisis and its consequences. This was accompanied with stc’s support to business operations through its advanced infrastructure with the best and widest coverage of the 5G network, whereby we launched the latest FULL 5G upgrade exclusively for the first time in Kuwait and the MENA region, through SA autonomous communication technology, to upgrade the 5G networks to a new level of exceptional speeds and improved coverage”.
Al Harbi added: “These outcomes resulted in the growth of EBITDA by 8.5% KD 79.6 million in 2021 compared to KD 73.4 million in 2020. Whereby, EBITDA margin reached 27% during the year ended in 2021 compared to 26% in the previous year. As a result, the company’s net profit during the FY2021 recorded a growth of 40% to reach KD 44.9 million (earnings per share 90 fils) compared to KD 32.1 million (earnings per share 64 fils) recorded by the company in 2020, as the financial impact of litigation had a significant impact on this growth in 2021. stc’s customer base reached approx. 2.0 million customers at the end of December 2021”.
Al Harbi noted: "In stc, we are working on implementing a balanced cost-efficiency policy to achieve the best results and enhance profitability through adopting effective financial plans to direct our operational and capital expenditures. Whereby, stc was able to structure its capital expenditures, especially after the negative impact of the current economic crisis, to ensure liquidity of its cash flows under the current circumstances. stc’s financial results throughout FY2021 also reflected its competitiveness and strengthened its position as the second largest telecommunications company in terms of its market share of revenue in the Kuwait telecommunications sector with a market share of approx. 36%”.
Source: Press Release