MTN Group Limited Reviewed interim results for the six months ended 30 June 2007
MTN global footprint Now operating in 21 countries serving a combined population of over 500 million people MTN Subscribers South and East West and Central Middle East and North Africa Region Africa Region Africa Region South Africa Nigeria Syria 13 412 000 14 036 000 2 592 000 Uganda Ghana Iran 1 869 000 3 392 000 1 983 000 Botswana Côte d’Ivoire Sudan 663 000 2 161 000 1 523 000 Rwanda Cameroon Yemen 486 000 1 954 000 1 301 000 Swaziland Benin Afghanistan 320 000 569 000 527 000 Zambia Guinea Republic Cyprus 202 000 393 000 99 000 Congo-Brazzaville 281 000 Liberia 253 000 Guinea Bissau 141 000 2
Agenda Strategic & operational overview Phuthuma Nhleko Group President and CEO Financial overview Rob Nisbet Group Finance Director Looking ahead … Phuthuma Nhleko 3
Strategic and operational overview Phuthuma Nhleko Group President and CEO 4
MTN vision To be the leader in telecommunications in emerging markets National Player African Player Emerging Market Player 1993 - 1997 1998 - 2005 2007 Operations 1 11 21 Population 41m 274m 506m 2007 Revenue Subscriber #’s 1998 - 2005 1993 - 1997 5
Group highlights for the 6 months ended 30 June 2007 Group subscribers Revenue 69% higher EBITDA up 75% up 90% to 48,2 million to ZAR 34,206 billion to ZAR 15,201 billion and 20% from Dec 2006 Adjusted headline EBITDA margin PAT increased to increased to 44.4% ZAR 6,305 billion EPS increased by 17% from 42.9% from to 324.7 cents ZAR 5,396 billion Strong performance from increased footprint 6 6
Key developments… • Strong rollout performance in new markets (Iran, Sudan, Ghana) Rollout • Market demand puts pressure on networks (SA, Nigeria), delivery evident in July/August • Brand • People Synergies • Products and distribution • Infrastructure • Shareholding changes in Botswana and Expansion opportunities & Côte d’Ivoire equity changes • VGC • Unproductive head office debt reducing Capital structure • Operational company’s optimising leverage 7
Regional synergies • Brand • People - Successful launch of MTN brand - “Synergies & standardisation” steercom under COO - Key Investcom operations rebranded - Staff diversity - Sponsor of 2010 soccer world cup - Employer of choice • Products & distribution • Infrastructure – Ongoing identification and rollout of key – Cost benefits products – Preferred vendor status – Leveraging of “MTN recipe” – Standardisation of technology platforms Regional hub & spoke support structure PREMIUM BRAND ABLE TO DELIVER BEST PRODUCTS MOST EFFICIENTLY 8 8
Subscriber contribution by region... MTN Group Total Proportionate* (subscriber million) (subscriber million) 48.2 17% 40.8 40.1 15% 12% 34.7 11% 25.3 48% 46% 21.5 49% 46% 49% 43% 39% 51% 39% 35% 57% 43% Jun-06 Dec-06 Jun-07 Jun-06 Dec-06 Jun-07 SEA WECA MENA SEA WECA MENA * Based on % ownership Increased diversification 9 9
Relative quarter ARPU performance (USD) 24 21 21 21 20 20 18 17 17 16 16 16 15 15 15 *17 10 10 9 South Africa Nigeria Ghana Sudan Syria Iran Dec06 (Q4) Mar07 (Q1) Jun07 (Q2) * Group weighted average ARPU -YTD 10
EBITDA analysis EBITDA EBITDA Contribution Margin SEA 34% 35% WECA 54% 54% MENA 8% 25% *MTN Group 100% 44% *Difference in HQ Companies 11
South & East Africa (SEA) region Growth from Jun 07 Dec 06 Population 99.4m + 0.5% 46% +6% pts Mobile penetration Subscriber numbers (m) South Africa (1) 13,412 + 7% 2 4 Uganda (2) 1,869 + 17% Botswana (3) 663 + 11% 6 Rwanda (4) 486 + 27% Swaziland (5) 320 + 19% 3 5 Zambia (6) 202 + 8% 1 Total SEA 16,952 + 9% % to Group 35% Strong growth continues 12 12
SEA region – overview 19% of Group population under coverage Subscribers (‘000) Revenue EBITDA 35% Group 43% Group 34% Group 103 961 57 107 499 486 1,869 202 10 69 38 320 223 663 67 13,093 4,492 13,412 South Africa Botswana Swaziland Zambia Uganda Rwanda • Appointment of Tim Lowry as VP • Botswana ownership increase from 51% to 53% - remains a JV • Competition impacts market share in Uganda and Zambia – addressed through improvements in infrastructure & distribution South & East Africa EBITDA margin 35% 13 13
SEA region South Africa – financial and operational highlights Launched Jun 1994 Market share 35% Population 47m Market sizing 48m (2011) Penetration 81% Shareholding 100% 13,412 Subscribers/ARPU • Stable market positioning 12,483 10,235 • Lower denomination vouchers 203 8,001 stimulate usage 6,270 184 149 169 164 • Q2 brand revitalisation campaign (Go!) • Unwinding of specific on-biller Mar-04 Mar-05 Dec-05 Dec-06 Jun-07 agreement migrates postpaid net MTN Subscribers ('000) ARPU - Blended (ZAR) additions to prepaid ARPU 576 541 ZAR per month 487 – by 147k over 6 months to date 435 – anticipate further 154k by year end • Realigning distribution strategy • Enhancing our network 97 93 87 94 Mar-05 Dec-05 Dec-06 Jun-07 Postpaid Prepaid • Avg. Total MOU comprises both 124 140 129 100 Incoming & Outgoing Minutes 14 14
SEA region South Africa – data highlights Data revenue • Improved performance ZAR million – SMS 69% (from 79%) of total data revenue 1,938 – Increased volumes – Competitive data pricing 1 159 1,221 • 3G rollout gaining momentum 1,082 905 403 – Expanded to 1152 sites from 793 at 502 Dec 06 1 221 779 679 – Approx 40% subscribers under coverage 403 – Approx 513k 3G handsets at June 2007 Mar-05 Dec-05 Dec-06 Jun-07 • Transmission importance increased First Half Second Half As % of 8,2% 5,9% 8,0% 9,0% MTN SA revenue More aggressive data strategy 15 15
SEA region South Africa – regulatory changes • DTI published final BEE Codes of Good Practice BEE • Industry aligned ICT Charter to BEE Codes for submission to DTI • ICASA to revert with market definitions and guidelines Interconnect • Outcome of pricing hearings still to be released by ICASA • Complaint lodged by Cell C referred to Competition Tribunal Competition commission • MTN to provide response based on case MTN won in the high court • Approved MTN COACAM • 2 filings submitted, ongoing dialogue 16 16
West & Central Africa (WECA) region Growth from Jun 07 Dec 06 Population 226m + 0.9% Mobile penetration 22% +3% pts Subscriber numbers (m) Nigeria (1) 14,036 + 14% Ghana (2) 3,392 + 31% Côte d’Ivoire (3) 2,161 + 33% Cameroon (4) 1,954 + 10% 9 6 5 1 Benin (5) 2 569 +20% 3 8 4 G. Conakry (6) 393 +42% 7 Congo B. (7) 281 +2% Liberia (8) 253 +16% G. Bissau (9) 141 +44% Total WECA 23,180 + 18% % to Group + 48% Largest contribution to Group 17 17
WECA region - overview 45% of Group population under coverage Revenue EBITDA Subscribers 44% Group 54% Group 48% Group 205 393 513 96 675 152 175 328 569 2,161 442 1,175 2,021 1,045 3,392 1,155 14,036 5,679 1,954 9,656 573 Nigeria Cameroon Ghana Ivory Coast Benin G.Conakry Other • WECA region highest revenue and EBITDA contribution to group • Benin network suspended on 12 July 2007 • Cameroon loss of 4 staff members (3 top executives) • Congo B impacted by delays in network upgrades High growth region 18 18
WECA region Nigeria - financial & operational highlights Launched Aug 2001 Market share 44% Population 140m Market sizing 52m (2011) Penetration 23% Shareholding 82% Subscribers/ARPU • Subscriber growth – impacted in Q2 by capacity & quality 14,036 constraints 12,281 • Market size estimates increase to 52 million subs by 2011 8,370 • Increasingly competitive market 40 – two new operators licensed Mubadala UAE 4,392 (GSM 900/1800) and Alheri Engineering (3G) • End of Pioneer Period, corporate tax 22 18 16 payer from April 07 • Acquired 100% VGC effective 31 Dec 06 Mar-05 Dec-05 Dec-06 Jun-07 MTN Subscribers ('000) ARPU (USD) • Broadening shareholder base remains a priority Increased profitability 19 19
WECA region Nigeria – network infrastructure & enhancements Geographic and population coverage • Additional spectrum awarded – 2 GHz spectrum license (3G services) 70% 71% * – 7.5 MHz 64% 61% * • Benefit of network capacity 60% 58% improvements expected in H2 – Installed 84 BTS to June 07 (111 sites 38% during July 07) 31% – Niger-delta & Lagos metro fibre optic cabling commissioned in H2 – Select 3G rollout before year end Geographic coverage Population coverage Mar-05 Dec-05 Dec-06 Jun-07 *Restated Most competitive coverage and backbone 20 20
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