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Imagine to Life

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Introduction to the report
Overview
Sustainability Outlook
Business Context and Strategy
Corporate Governance
Financial Statements
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Annual Report 2024

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Business Context and Strategy
Business Context and Strategy

Risk and Cybersecurity

Omantel operates in a dynamic environment with continually evolving financial, operational, regulatory, environmental and technological risks. The Company’s Enterprise risk management (ERM) framework is designed to ensure business continuity, protect shareholder value, and enable sustainable growth as we steer forward with the Portal to the Future strategy for sustainable growth.

Omantel’s ERM framework and processes incorporates leading risk management standards and best practices and aligns with international standards to address financial exposure, cybersecurity threats, regulatory compliance, and environmental risks.

We have identified principal risk areas, and have consistently reviewed each segment at an organisational level with Board direction, implementing mitigation measures as needed. This approach aligns with our goal of sustainable growth through robust digital transformation, contributing to the Oman Vision 2040, whilst creating value for all stakeholders.

Financial Risks

Omantel operates in a dynamic financial landscape where fluctuations in market conditions, currency exchange rates, interest rates, and economic downturns can impact profitability and investment returns. Effective financial risk management is essential for maintaining stability, ensuring liquidity, and supporting long-term growth.

Liquidity Risk Debt and Capital Management Foreign Exchange and Market Risks
  • Omantel manages the risk by maintaining sufficient cash and marketable securities, availability of funding from committed credit facilities and its ability to close out market positions on short notice. The Company’s Board of Directors increases borrowings based on ongoing review of funding requirements.
  • In managing debt and capital, Omantel considers the financial covenants in various loan agreements that require the Group to maintain specific levels of debt-equity and leverage ratios. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, sell assets to reduce debt.
  • Omantel also monitors capital on the basis of the gearing ratio.
  • Omantel is exposed to foreign exchange risk arising from currency exposures, primarily with respect to the US Dollar. The US Dollar and Omani Rial exchange rate have remained unchanged since 1986. There are no significant financial instruments denominated in foreign currency other than US Dollars. Omantel’s has set up a policy that requires to manage their foreign exchange risk against their functional currency.
  • Omantel’s borrowings issued at variable rates expose to cash flow interest rate risk. The borrowings at variable rates are denominated mainly in US Dollars. The Group analyses its interest rate exposure on a dynamic basis. Various scenarios are simulated taking into consideration refinancing, renewal of existing positions and alternative financing. For each simulation, the same interest rate shift is used for all currencies. The scenarios are run only for liabilities that represent the major interest-bearing positions. Omantel manages interest rate risk by monitoring interest rate movements and by using Interest Rate Swaps to hedge interest rate risk exposures. Hedging activities are evaluated regularly to align with interest rate views and defined risk appetite, ensuring the most cost-effective hedging strategies are applied.

Operational Risks

As a leading telecommunications provider, Omantel faces operational risks that stem from system failures, human errors, process inefficiencies, and unforeseen disruptions.

Ensuring business continuity through robust risk mitigation strategies and operational resilience is critical to maintaining service excellence.

Business Resilience Network and Infrastructure Risk Supply Chain Risk
  • Business continuity planning (BCP) enhancements ensuring quick recovery in case of network disruptions.
  • Redundancy measures have been implemented to ensure service continuity in cases of natural disasters, or geopolitical risks
  • Omantel adheres to ISO 22301, the international standard for Business Continuity Management Systems (BCMS), strengthening its resilience against operational disruptions.
  • 5G Network Expansion: Omantel has secured a second 5G carrier and initiated 5.5G trials to maintain competitive leadership.
  • Submarine Cables and International Expansion: Oman is a strategic hub for global data traffic, with Omantel investing in 20+ submarine cable systems to secure international connectivity.
  • Multi-layered vendor risk management ensuring supply chain resilience.

Cybersecurity Leadership and Advocacy

Omantel has demonstrated leadership in cybersecurity by playing a pivotal role in establishing the Middle East Fraud and Security Group (MEFASG) under GSMA, which was officially approved in April 2024. As the chair of MEFASG, Omantel leads intelligence sharing, threat analysis, and mitigation strategies, strengthening regional telecom security. Omantel’s active participation in GSMA’s Fraud and Security Group (FASG) and MEFASG continues to be instrumental in driving the adoption of standardised security measures across telecom networks in the region. Additionally, GSMA’s implementation of security policies, including 5G security, AI-driven fraud prevention, and cybersecurity threat intelligence sharing, is significantly influenced by Omantel’s leadership in shaping industry standards.

Cyber Security and Data privacy Risks

Omantel faces increasing cybersecurity and data privacy threats that arise from sophisticated cyberattacks, data breaches, and evolving regulatory requirements. Protecting sensitive customer and business data is paramount in an era of heightened digital risks. Strengthening cybersecurity frameworks, implementing proactive threat detection, and ensuring compliance with data protection laws are critical to safeguarding Omantel’s operations and maintaining customer trust.

Data Privacy and Cloud Sovereignty Network Security Cyber Threats Third Part Cyber Threats
  • Regulatory alignment with GSMA cybersecurity frameworks.
  • Compliance with Oman’s Personal Data Protection Law (PDPL).
  • ISO & PCI Certifications Maintained:
  • ISO 27001: Information Security Management
  • ISO 27701: Privacy Information Management
  • ISO 27017 & 27018: Cloud security & privacy compliance.
  • Security Operations Centre (SOC) Enhancements:
  • Managed over 8,000 true security incidents in 2024.
  • Blocked 34TB of malicious traffic, preventing cyber threats
  • Prevented 600,000+ fraudulent calls from reaching customers
  • Identity and Access Management (IAM) solution enhanced secure access across critical applications.
  • Securing the Oman National Cloud: Received MTCIT accreditation in 2024 for compliance with international security standards
  • Threat Intelligence and AI-Powered Security:

    AI-driven cyber threats, including deepfake fraud and AI-generated phishing attacks, have been identified, prompting the enhancement of AI-powered detection models to proactively identify anomalies.

  • 5G and IoT Security Enhancements:

    Omantel has implemented 5G network slicing security improvements for enterprise customers while deploying new IoT security frameworks to protect smart city applications.

  • Cybersecurity Expansion Strategy:

    Omantel is expanding regional cyber intelligence sharing through the GSMA Middle East FASG, while advancing research in biometric authentication and quantum cryptography for telecom security, adopting zero-trust security models for enterprise customers, developing a quantum cryptography roadmap for secure telecom transactions, and integrating blockchain technology for fraud prevention in telecom security.
  • Omantel upgraded the disaster recovery plans (DRP) to minimise downtime in case of cyber incidents.
  • Simulated cybersecurity breach exercises conducted with GSMA partners to test response capabilities.
  • Redundancy measures are in place to ensure service continuity in cases of cyberattacks.
  • Third-Party Security Audits: conducting third-party security audits to evaluate the cybersecurity readiness of vendors and ensure compliance with ISO and PDPL security mandates.
  • Conducting penetration testing on third party integrations, identifying and mitigating risks.

Regulatory and Compliance Risks

Omantel operates in a highly regulated environment where compliance with evolving telecom regulations, data protection laws, and industry standards is paramount.

Failure to adhere to regulatory requirements can result in penalties, reputational damage, and operational constraints, making proactive compliance management essential.

Telecom Licensing and Market Liberalisation

Access to spectrum allocation for 5G and 5.5G expansion managed by the Telecommunications Regulatory Authority (TRA).

Alignment with AI-driven security solutions for mobile networks.

Sustainability Risks

As sustainability expectations grow, Omantel must address risks related to climate change, energy consumption, and environmental regulations.

Implementing eco-friendly initiatives, reducing carbon emissions, and enhancing sustainability practices are integral to long-term corporate responsibility and resilience.

Climate Change and Carbon Emissions E-Waste and Circular Economy
Omantel has committed to achieving net-zero carbon emissions by 2050, aligning with national and global sustainability goals. Implementation of telecom equipment recycling programmes.
Initiatives related to Energy Management and Efficiency Projects Adoption of cloud-based virtualisation to reduce hardware dependency

Strategic Risks

In an increasingly competitive telecom market, Omantel must navigate risks associated with industry disruptions, technological advancements, and shifting consumer demands. Strategic agility, innovation, and continuous market analysis are crucial for maintaining a competitive edge and achieving sustainable growth.

Market Disruptions and Competition

Omantel faces intense competition from regional telecom operators and OTT services like WhatsApp and Zoom, impacting voice and SMS revenues; to counter this, the Company is diversifying our revenue streams into FinTech, AI-driven analytics, and cybersecurity services.

Our overall risk management strategy integrates financial, operational, regulatory, cybersecurity, and sustainability measures to ensure business resilience. Omantel consistently implements risk mitigation measures through strategic investments, technological innovation, regulatory alignment, and sustainability initiatives. As we transition into the “Portal to the Future” strategy (2025–2030), our robust Governance, ERM and Business Resilience frameworks will remain central to safeguarding long-term growth and value creation.

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