Etihad GO Telecom Co. — Annual Report 2016

Jun 13, 2016

Etihad Atheeb Telecommunication Co. announces the annual financial results for the period ending on 31-03-2016

7040 · 13/06/2016 16:04:04 · Announcement #42941 · View on Saudi Exchange

Etihad Atheeb Telecommunication Co. announces the annual financial results for the period ending on 31-03-2016

Element	Current year	Previous year	% Change
Net profit (loss)	-148.09	-56.24	-163.32
Earning or loss per share, Riyals	-0.94	-0.36	-
Gross profit (loss)	31.38	29.96	4.74
Operational profit (loss)	-289.47	-292.56	1.06

*All figures are in (Millions) Saudi Arabia, Riyals

Element	EXPLAINATION
Reasons of annual financial results	The reason for the increase of the net loss compared with the last year due to decrease in other income, increase in cost of sales, and increase in selling and marketing expenses.
External auditor's report containing reservation	We have audited the accompanying financial statements of Etihad Atheeb Telecommunication Company (the Company) which comprise the balance sheet as at 31 March 2016, and the related statements of income, cash flows and changes in shareholders equity for the year then ended and the attached notes (1) through (24) which form an integral part of the financial statements. Managements responsibility for the financial statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with generally accepted accounting standards in the Kingdom of Saudi Arabia and in compliance with Article 123 of the Regulations for Companies and the Company by laws and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Management has provided us with all the information and explanations that we require relating to our audit of these financial statements. Auditors responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards in the Kingdom of Saudi Arabia. Those standards require that we comply with relevant ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal controls relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Opinion In our opinion, the financial statements taken as a whole: present fairly, in all material respects, the financial position of Etihad Atheeb Telecommunication Company as at 31 March 2016, and results of its operations and its cash flows for the year then ended in accordance with generally accepted accounting standards in the Kingdom of Saudi Arabia appropriate to the circumstances of the Company, and comply with the requirements of the Regulations for Companies and the Company s by laws with respect to the preparation and presentation of the financial statements. Emphasis of matter We draw attention to Note 2(b) to the accompanying financial statements; as at 31 March 2016, the Company s current liabilities exceeded its current assets by SAR 385 million (2015: SAR 306 million) and the accumulated losses approximate to 69.5% of the Company s share capital. These conditions indicate the existence of a material uncertainty that may cast significant doubt about the Company s ability to continue as a going concern. The Company s management believes that the agreements held, as explained in Note 1(b) and 1(c) to the accompanying financial statements, would increase the business of the Company by enabling it to provide more and improved services. Also, the management believes that it will be able to secure the necessary funding to meet its obligations as and when they become due. Accordingly, the accompanying financial statements have been prepared under going concern basis.
Other notes	The company assured that the total operating revenue for the year ended on 31 March 2016 increased by 38.8% (SAR 95.9 million) to reach SAR 343 million compared to SAR 247.1 million the last year, mainly due to increase of interconnection revenue by 86.3% (SAR 80.7 million) as a result of increasing of local and international traffic with local and international operators, and increased revenue from business sector by 40.3% (SAR 33.3 million) as a result of increasing the number of customers and providing new and comprehensive innovative solutions to satisfy the business sector needs. Despite of the decrease in home and consumer broadband revenue by 25.5% (SAR 18.1 million) as a result of high competition with many available alternative services of high speed. To compensate for this drop in revenue in the consumer sector, the company has already started providing new Broadband services with high speed reaching up to 200Mbps using FTTH and LTE 4G with competitive prices in order to maintain its position in this sector. The new revenue from these new services reached 28% of the consumer segment revenue and 5% of the total company revenue, which is expected to grow further in the future.

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