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MTN Group Limited Integrated Business Report for the Year Ended 31 December 2007 Is to Be the Leading Our Vision

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MTN Group Limited Integrated Business Report for the Year Ended 31 December 2007 Is to Be the Leading Our Vision MTN Group Limited Integrated business report for the year ended 31 December 2007 is to be the leading Our vision . provider of telecommunications services Contents in emerging markets Q Group Profi le Q MTN Group operating regions Q Global presence Q Group structure 1 Q Group fi nancial highlights 4 Q Chairman’s statement 8 Q Group directorate 14 Q Group president and CEO’s report 22 Q Executive management 26 Q Group fi nance director’s report 49 Q Value added statement 50 Q Five-year review 54 Q Group chief operating offi cer’s report 86 Q Sustainability review 102 Q Corporate governance 113 Q Risk management 124 Q Glossary 130 Q Annual fi nancial statements 252 Q Shareholders’ information 265 Q Form of proxy 267Q Map South and East Africa region The MTN Group Limited (MTN Group) is a leading provider Revenue contribution to Group (Rm) of telecommunications services, offering cellular network access and business solutions. R31 453 The MTN Group is listed in South Subscribers Africa on the JSE under the Industrial 1. South Africa 3. Botswana 5. Swaziland – Telecommunications sector. 14 799 000 874 000 380 000 2. Uganda 4. Rwanda 6. Zambia Launched in 1994, the MTN Group is a multinational telecommunications 2 362 000 652 000 262 000 group, operating in 21 countries in Africa and the Middle East. As at the end of December 2007, MTN recorded more than 61 million West and Central Africa region subscribers across its operations Revenue contribution to Group (Rm) The MTN Group operates in Afghanistan, Benin, Botswana, R31 115 Cameroon, Congo-Brazzaville, Subscribers Côte d’Ivoire, Cyprus, Ghana, 1. Nigeria 4. Cameroon 7. Congo-Brazzaville Guinea Bissau, Guinea Conakry, 16 511 000 2 559 000 316 000 Iran, Liberia, Nigeria, Rwanda, South Africa, Sudan, Swaziland, 2. Ghana 5. Guinea Conakry 8. Liberia Syria, Uganda, Yemen and Zambia. 4 016 000 727 000 304 000 For further information on MTN, visit our website www.mtn.com 3. Côte d’Ivoire 6. Benin 9. Guinea Bissau 652 000 235 000 2 679 000 MTN Group operating regions South and East Africa (SEA) MTN South Africa, MTN Swaziland, Middle East and North Africa region MTN Zambia, MTN Uganda, MTN Rwanda and Mascom Revenue contribution to Group (Rm) Botswana. R10 779 West and Central Africa (WECA) Subscribers MTN Nigeria, MTN Cameroon, 1. Iran 3. Sudan 5. Afghanistan MTN Congo-Brazzaville, MTN Côte d’Ivoire, MTN Benin, MTN Ghana, 6 006 000 2 090 000 1 200 000 MTN Guinea Bissau, MTN Guinea 2. Syria 4. Yemen 6. Cyprus Conakry and Lonestar Liberia. 3 109 000 1 507 000 113 000 Middle East and North Africa (MENA) MTN Irancell and MTN Afghanistan, MTN Cyprus, MTN Sudan, MTN Syria, Total Group – 61,4 million subscribers MTN Yemen and MTN International MTN Holdings 100% South Africa MTN MTN MTN Network Service Network Operator Provider Solutions 100% 100% 100% MTN International 100% MTN Mauritius MTN Dubai 100% 100% MTN MTN MTN Guinea MTN Swaziland Cameroon Conakry Benin 30% 70% 75% 75% MTN MTN Congo- MTN MTN Guinea Uganda Brazzaville Ghana Bissau 95% 100% 98% 100% Mascom MTN Lonestar MTN Botswana Nigeria Liberia Syria 53% 82% 60% 75% MTN MTN MTN MTN Rwanda Côte d’Ivoire Yemen Cyprus 55% 60% 83% 99% MTN MTN MTN MTN Zambia Irancell Sudan Afghanistan 100% 49% 85% 100% MTN International Carrier Services 100% Q South and East Africa region Q West and Central Africa region Q Middle East and North Africa region MTN Group financial highlights Subscribers (million) 70 61 60 50 40 40 30 23 20 16 10 10 0 Mar 04 Mar 05 Dec 05 Dec 06 Dec 07 (9 months) Group revenue Revenue (R billion) 80 73 70 R73,1 billion 60 52 50 up 42% 40 29 30 24 27 20 EBITDA 10 0 Mar 04 Mar 05 Dec 05 Dec 06 Dec 07 R31,8 billion (9 months) up 42% EBITDA (R billion) 35 32 Net debt to EBITDA 30 25 22 20 0,5 x 15 12 11 10 9 Dividend per share 5 0 Mar 04 Mar 05 Dec 05 Dec 06 Dec 07 136 cents (9 months) Adjusted HEPS (cents per share) 700 682 600 585 500 400 366 338 300 253 200 100 0 Mar 04 Mar 05 Dec 05 Dec 06 Dec 07 (9 months) MTN Integrated Business Report N31 December 2007 1 Contents 4 Q Chairman’s statement 8 Q Group directorate 14 Q Group president and CEO’s report 22 Q Executive management 26 Q Group fi nance directors’ report 49 Q Value added statement 50 Q Five-year review Ou s 2 MTN Integrated Business Report Q31 December 2007 Notice of the thirteenth annual general meeting continued MTN Today MTN for the year ended 31 December 2007 Our values ve Our conduct and interaction with stakeholders is founded on fi shared valueswe continue which driveto break MTN ground. as MTN Integrated Business Report N31 December 2007 3 Chairman’s statement Dear stakeholders Geopolitical environment MTN is evolving into a leading provider of Financial and political uncertainty is telecommunications services in emerging heightened across the globe, with investors markets. This is refl ected in sustained strong becoming increasingly risk averse. Despite performance, underpinned by steady organic this backdrop MTN has proven that emerging growth, prudent acquisitions and rigorous markets off er sound growth opportunities. governance. This is not expected to change going forward, given improving economic fundamentals The Group delivered an excellent performance and relatively low levels of penetration in the 12 months to 31 December 2007, across the majority of markets in which recording a 53% increase in subscriber we operate. The Group has a strong track numbers to 61,4 million, a 42% increase in record of constructively addressing the revenue to over R73 billion and a 42% increase many challenges presented in emerging in earnings before interest, tax, depreciation markets, including challenging regulatory and amortisation (EBITDA) to nearly R32 billion. environments, which is evidenced by strong fi nancial and operational performance Working from a detailed strategic blueprint – to date. explained in diff erent sections of this report – we have approved an increase in capital Robust risk management processes are expenditure to enhance quality and network substantially in place. Government relations coverage. In this rapidly growing and and a policy of pro-active corporate citizenship competitive industry, innovation is key and, and social responsibility programmes add again, MTN has proved its ability to innovate tangible value to the quality of life of millions by introducing new relevant products of people. based on existing and complementary technologies such as third-generation Industry developments or 3G and GPRS. A diverse, high calibre Mobile connectivity in emerging markets workforce such as ours, with signifi cant is fast becoming the primary means of experience in developing markets is an communication and there is strong evidence unrivalled competitive advantage. that it represents the most far-reaching 4 MTN Abridged Business Report N31 December 2007 Cyril Ramaphosa Non-executive chairman MTN is evolving into a leading provider of telecommunications services in emerging markets. MTN Integrated Business Report Q31 December 2007 5 Chairman’s statement continued solution to reduce the digital divide and MTN is leveraging the considerable bring economic growth to underdeveloped opportunity for providing converged regions. MTN’s anecdotal evidence communication services across voice and supports this, highlighting two features that data. differentiate mobile telecommunications in emerging markets: firstly the rapid pace of Corporate governance subscriber acquisition to the point where The board of directors endeavours to mobile handsets far outnumber available ensure that all operations comply with the fixed lines and, secondly, the role of mobile Code of Corporate Practices and Conduct communications in sustainable development. recommended by King II and the benchmarks Our sustainability report details some of of global best practice. the initiatives we are spearheading and supporting through MTN foundations that As a result of extensive new commitments, we are rolling out in each of our operations. MA Ramphele and PL Woicke resigned as directors with effect from 18 March 2008. The Convergence is a reality in emerging board greatly appreciates their contribution markets and therefore has a direct impact to the achievements of the Group and wishes on MTN’s business. Unified licences them well in their endeavours. permit delivery of an increased range of services through any medium. Technology Sustainability reporting advancements allow for accelerated MTN presents an annual integrated report broadband speeds making the provision of to stakeholders – combining our economic, many converged services possible. social and environmental performance, challenges and targets. In doing so, we are Based on convergence, customers demand guided by international reporting benchmarks more integrated and sophisticated services. such as the Global Reporting Initiative These range from individual products to (GRI) and its telecommunications-specific tailor-made bespoke corporate solutions. supplements. In operational areas where 6 MTN Abridged Business Report N31 December 2007 stakeholder reporting standards are not yet fully developed, we apply best practice. Our intention is to present a comprehensive and cohesive view of our Group – one that addresses the issues raised by ongoing stakeholder engagement, and elaborates on the way forward. Appreciation Our promise to every subscriber is that MTN will be everywhere you go. The same promise applies to the nearly 15 000 people who constitute the “MTN family” across 21 countries. These are extraordinary people with extraordinary skills and commitment. The Group has a Combined, they create a community noted strong track record for its camaraderie and passion. of constructively addressing I thank our stakeholders – our shareholders, challenges. board members, management and staff , business partners and loyal customers – for allowing us to turn our promise of everywhere you go into reality, every day.
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