Riyadh - Mubasher: Saudi Mobile Telecommunications Co.’s (Zain KSA) losses increased 19.73% year-on-year to SAR 267 million ($71.2 million) in the third quarter of 2016 from SAR 223 million ($59.47 million).

The company decreased its cost of revenue by 18% after the decrease in Mobile Termination Rate (MTR) cost and achieved 65% gross margin (highest since inception), according to a bourse filing on Monday.

The widened losses were attributed to an increase in depreciation and a rise in the financial charges and SAIBOR.

On the nine-month level, the company’s losses reached SAR 845 million ($225.3 million) in 2016 compared to SAR 681 million ($181.6 million) in the same period of 2015.

Zain KSA maintained positive results with revenues increasing by 1% reaching SAR 5,126 million; Gross profits grow by 13% reaching SAR 3,259 million, with gross margin reaching 64% (highest since inception), the statement said.

The company’s accumulated losses reached SAR 2.12 billion, representing 36.38% of capital worth SAR 5.84 billion.

Zain’s management is still in negotiation with banks to reset new covenant based on new business plan approved by the company’s board on 20 January 2015.