#HumanInside Annual Report 2018

Human Inside 4 Foreword

«At the crossroads of my path,» Living in a world in a constant state of flux animated by ever more omniscient and complex technologies, humans must adapt if they do not want to find themselves on the sidelines of the Digital Revolution.

While we rely more and more on «artificial intelligence» on a daily basis to innovate, to work, to undertake or to have fun, we should not forget what constitutes our specificity, the intelligence of the heart.

It is what drives us to desire a better future, to remain optimistic and develop our empathy. In a word, it makes us human.

It is to the Human that the Annual Report is dedicated this year, and more particularly to these women and men who randomly cross our paths on a daily basis. They who have little, but for whom the desire to succeed is stronger than everything else.

At the heart of everyday life, this entrepreneurial energy is everywhere and positivism is a permanent reality.

Don’t we say: «It’ll be fine!»

Sonatel draws from this optimism, infusing it into all its actions and providing daily solutions to all populations.

Because we believe that behind the emergence of digital technologies, the human is at the center of everything. #HumanInside.

5

Sonatel Annual Report 2018

CONTENTS

Letter from the President 9 Message from the General Manager 10 1. Good governance, guarantee of transparency 13 2. Human ressources 27 3. Sonatel’s civic engagement in Senegal and its subsidiaries 35 3.1 Sonatel, an Operator committed to economic and social development in all its countries of presence 36 3.2 Patronage 51 4. Our activities 59 4.1 In Senegal… 60 4.1.1 Mobile, Fixed and Internet 60 4.1.2 Orange Money 62 4.1.3 Business services 63 4.1.4 Content: development and innovation 65 4.1.5 Transformation of the sales department 66 4.1.6 Ambition of the Corporate Plan: to make customer experience the factor that differentiates the company from the competition and drives customer preference for Orange 67 4.1.7 To deliver to our customers an incomparable experience that makes them prefer Orange 68 4.2 … and in the subsidiaries 69 4.2.1 Orange Mali 69 4.2.2 Orange Guinea 71 4.2.3 Orange Bissau 74 4.2.4 Start of activities in Sierra Leone 76 5. Information systems and networks 81 6. Sonatel abroad 87 7. Key figures and Sonatel on the stock market 95 8. Financial report 115 9. Financial statements 147 10. Annexes 231 - Auditors General Report on the consolidated financial statements of the Sonatel Group 232 - Auditors General and Special Report on the accounts of SONATEL SA 241 - Agenda of the Ordinary General Assembly 270

7 Alioune NDIAYE Chairman of the Board of Directors

8 Sonatel Annual Report 2018

THE CHAIRMAN’S LETTER

2018 was characterized by the confirmation of The Sonatel Group has confirmed its position strong operational and financial performance in as a major player in wealth creation in all its our countries of presence. countries of presence. It achieved this by pursuing its unstinting commitment to its This dynamic was made possible by the contri- stakeholders in its actions in the field of corporate bution of the Group’s subsidiaries in the Sub-Re- social responsibility, which further increases the gion despite a highly competitive, regulatory and Group’s socio-economic footprint. tax environment. Conscious of its driving role in the digital ecosystem, Thanks to its investments, the Sonatel Group the Group intends to continue its efforts in this has maintained and consolidated its profitability adaptation strategy by implementing, as soon as trajectory and its commercial positions. 194.3 possible, all the structuring developments in the billion XOF was invested during the year, telecommunications sector. representing a growth of 5.7% compared to 2017, thus enabling us to have a total subscriber The 2022 Corporate Plan aims to make Sonatel base of 29.7 million customers at the end of 2018. a resolutely customer-oriented Group, a special partner in the digital transformation of our These investments have significantly helped im- companies in 2022, by supporting the States prove customer experience, strengthen opera- and the society for the digital emergence of the tional excellence, while boosting the continued territories and by reinforcing its civic commitment efforts to enhance the quality of technical service through its corporate social responsibility policy. and customer loyalty policy. Confident in the continued strength and sound- The consolidated turnover of the Group crossed ness of Sonatel Group’s financial structure, the a symbolic line when it reached 1022 billion XOF Board of Directors proposes to the General Mee- in 2018. The net income is 202 billion XOF, stable ting of 17 April 2019 the payment of a net divi- compared to last year. The weight of mobile dend of 1,500 XOF per share. data, mobile financial services and value-added services continues to grow and represents just All members of the Board of Directors and I over 25% of our turnover, showing that Sonatel extend our congratulations to all the employees is able to manage the profound transformation of the Sonatel Group for these good results and of its business models. In the wake of revenue our encouragement for the future. growth, profitability trajectories improved, reflected by the positive evolution of the EBITDA I remain convinced to this day that the mobilization growth to 462 billion XOF, ie +2.2% compared and commitment of everyone at Sonatel and to 2017. its subsidiaries in the service of our customers will enable the Group to stay the course of our It is important to note that the maintenance of endeavour toward an increasingly successful these strong commercial positions took place future. despite a competitive environment that is expan- ding in Senegal (launch of three Internet Service The Sonatel Group can count on the support of Providers) and in Mali (launch of a third operator the Board of Directors to remain a key player and acquisition of a 4G license by the 2nd) and in the development of the digital economy and a regulatory and tax environment that is toughe- digital transformation. ning, with new measures such as the unbundling of the local loop in Senegal, and the designation of Sonatel as a powerful operator in Senegal, or the increase in taxes, especially on turnover or volume, which compromise consumption.

9 THE MESSAGE OF THE MANAGING Sékou DRAMÉ Managing Director DIRECTOR

The Sonatel Group consolidates its leadership and maintains strong operational and financial performance in its five countries of presence. Continued investment in maintaining the competitive edge in connectivity has helped maintain a consistent margin through revenue growth, improved profitability of mobile data, mobile financial services and control of direct costs, despite the continued decline in incomes from inbound international traffic.

We continue our transformation to become a multiservice operator serving everyone. We were able to maintain our leadership in our core markets by maintaining our recruitment drive and strong market positions in value and volume. We are proud to have driven the Group’s consolidated turnover to the symbolic level of 1022 billion XOF in fiscal year 2018, representing a growth of 5%.

I would like to congratulate the men and women of the Sonatel Group for their commitment and professionalism, which allowed us to achieve these excellent operational results.

10 Sonatel Annual Report 2018

I also congratulate all our partners and suppliers As in the past year, with the support of our who help us on a daily basis to deliver the best shareholders, we intend to continue our investment service to our customers. efforts to consolidate our competitive edge in connectivity and our commercial policy. Our goal The Sonatel Group stands for responsibility. Our is to continuously offer a unique and incomparable corporate social responsibility prompts us, in all experience to better support our customer loyalty our countries of presence, to take an active part in drive as well as our value positioning by delivering ensuring the sustainable economic development a recognized and differentiated quality of technical and well-being of the population because we are and commercial service. aware of our leading role in this ecosystem. It is therefore with pleasure that I invite you Wherever we operate, we support local startups to discover all the financial results and our during the different stages of their growth: achievements in this annual report whose creative from training to logistical and financial support focus is resolutely human-centred. including animation. The incubators supported by our subsidiaries, such as CREATEAM (Mali) and SABOUTECH (Guinea), continue to grow for the benefit of the players in the digital ecosystem, while backstopping the strategies of transformation or digital emergence undertaken by the States in all our countries of presence. Sonatel Academy, the first free coding school in Senegal, celebrated in early 2019 the successful graduation of its first batch of students in web development.

The foundations of the Sonatel Group are also the guarantors of our civic commitment and enable us, notably thanks to flagship projects such as the Digital Houses and «Village Projects», to help empower women and deliver services to remote communities by building health centers, schools and water points. Fifteen villages have benefited from this programme in Senegal, Mali and Guinea since it started four years ago.

11

GOOD GOVERNANCE, GUARANTEE OF TRANSPARENCY

Rules of good governance / Board of Directors / Audit Committee

Since May 5, 2014, the date of entry into force Articles 547-1, 831-2 and 831-3 of the above- of the new OHADA Uniform Act on the Law of mentioned Uniform Act set out these new rules. Commercial Companies and Economic Interest Groups (AUSCGIE), all commercial companies Sonatel did not wait for the implementation of have the legal obligation to bring to the attention these provisions to inform its stakeholders about of of their shareholders a certain amount of its governance. information, notably concerning the governance Thus, as usual, Sonatel shares with its shareholders of their company. the following information. TERMS AND CONDITIONS FOR 1.1 SHAREHOLDER PARTICIPATION AT A GENERAL MEETING OF SONATEL

The right to participate in the Meetings is subject Whatever the number of shares they hold; any to the registration of the name of the shareholder shareholder may participate or be represented at in the register of registered shares, 5 days before Extraordinary General Meetings. the meeting. Any shareholder may be represented by their The accounting record of the shares in the name of spouse or an agent of their choice, who may be a the shareholder or the temporary agent registered shareholder or not. on his behalf, on the third working day preceding the Meeting at midnight local time, in the bearer Every shareholder has as many votes as the securities registers kept by the Stock Exchange shares they own and represent. (Bourse des Valeurs Mobilières, or BRVM) also confers the right to attend General Meetings. The proxy holder of a shareholder has the votes of their principal under the same conditions and Any shareholder (or group of shareholders) the same limit. holding at least one hundred (100) shares may attend or be represented at Ordinary General Meetings.

UPDATE ON THE STATUS OF THE 1.2 EMPLOYEE PARTICIPATION IN CAPITAL AS AT 31 DECEMBER, 2018

Sonatel attaches special importance to the At 31 December, 2018, the Sonatel Group had shareholding of its staff and it is for this purpose 1,805 employees in Senegal (foreign subsidiaries that, since its stock market listing in 1998, all not included). staff are shareholders. As at 31 December, 2018, 1,781 active employees This shareholding of Sonatel Group company of Sonatel are shareholders, ie a 5.97% stake in employees is now cited as an example, with the share capital. each employee feeling more concerned about the future of his company.

This example is replicated in many companies today.

14

COMPOSITION OF THE BOARD OF 1.3 DIRECTORS OF SONATEL

As of 31 December, 2018, Sonatel’s Board of Directors is composed of the following 10 members (09 directors and a representative of the Financial Controller):

Alioune NDIAYE Chairman of the Board of Directors

Bassirou Samba NIASSE Hugues FOULON Abdoulaye DIOP Director Director Director

16 Sonatel Annual Report 2018

Mamadou Aïdara DIOP Colonel Koly FAYE Ludovic PECH Director Director Director

Jérôme HENIQUE Thierry BRETON Director Director

Abdoulaye KAMARA Representing The Financial Controller

17 1.4 GROUP MANAGEMENT COMMITTEE

Sékou DRAMÉ Fabrice ANDRÉ General Managing Director Deputy Director General

Brelotte BA Aboubacar Sadikh Seydi Ahmed SY Aminata KANE Managing Director DIOP SARR NDIAYE Orange Mali Managing Director Managing Director Managing Director Orange Guinea Orange Bissau Orange Sierra Leone

Omar Guèye NDIAYE El Hadj Malick DARY Ramatoulaye DIALLO Managing Director Deputy Director SHAGAYA Sonatel Multimedia Sonatel Mobiles Managing Director Director of Strategy Director of Consumer Orange Finances Mobiles and Development Marketing Senegal

18 Sonatel Annual Report 2018

Racky Sada WANE Alioune KANE Abdou Karim Afissatou SALL Director of Information Sales Manager MBENGUE GAYE Systems Director of Institutional Director of Risk Audit Communication and and Quality External Relations

Rokhaya GUÈYE Ousmane Boly Gisèle Pouye GUÈYE Mamadou Ibrahima DIAGNE TRAORÉ Director TRAORÉ Director of Regulation Director Finance Customer Service Director of Human and Legal Affairs and Accountant Resources

Thérèse TOUNKARA Fatoumata SARR DIENG Ousmane DIENG Amadou DEME Director of Networks Director of International Director of Business Director of Procurement and Service Platforms Operations and Operators Services and Logistics

19 RULES GOVERNING THE PREPARA- 1.5 TION AND ORGANIZATION OF THE WORK OF THE BOARD OF SONATEL

The rules for preparing and organizing the work The documents relating to the items on the of the Board are set by the Articles of Association agenda are communicated to the Directors, at and the By-Laws of Sonatel. least: - ten (10) days before any meeting in the case Improvement measures are continuously taken of documents submitted for decision-making, alongside these texts. - five (5) days (including a weekend) before any meeting in the case of documents provided Thus, the Chairman now draws up, before the for information purposes. beginning of each year, the annual calendar of meetings of the Board of Directors. The Chairman of the Board of Directors may invite members of the Sonatel Management Team, Previously, a half-yearly calendar was established after consultation with the Director General, before the beginning of the semester. depending on the items to be dealt with in the agenda. The convening notices for the Board meetings specifying the agenda are issued by registered In any event, the Board of Directors may, at letters, e-mail from the Chairman, at least fifteen each of its meetings, in case of urgency and (15) days before the date of the meeting or at on the proposal of the Chairman, deliberate on least three (3) days before the date of the meeting any question not included in the agenda that is in case of urgency. communicated to it.

The determination of the urgency of the decision The deliberations of the Board are recorded in or decisions to be taken is left to the discretion of minutes drawn up by the Chairman of the meeting the Chairman of the Board of Directors. and the secretary and signed by the Chairman of the meeting and at least one director.

20 Sonatel Annual Report 2018

APPLICATION OF THE CODES 1.6 OF GOVERNANCE OF THE ISA AND THE CSPC

Since 2011, Sonatel has been complying with which was estabblished by the Government of the Code of Corporate Governance developed Senegal and the World Bank, who consider that by the Senegalese Institute of Directors (Institut Sénégalais des Administrateurs, or ISA). corruption is an obstacle to Senegal’s economic and social development. The purpose of this code is to promote good governance practices in companies in both the Sonatel has adhered to the Code of Conduct public and private sectors. which: - sets the guiding principles and rules of conduct The provisions of the code, inspired by OHADA, about fighting corruption, constitute a set of rules of good corporate - promotes ethics and good corporate conduct. governance in private sector companies, and in the relations between private sector companies The Board of Directors of Sonatel decided to and between them and administrations, comply with the rules defined by this Code customers and consumers. because its texts highlight good governance practices. These rules include, among others: This Code is based on three guiding principles: - the relationship between Sonatel and its - ethics through the definition and implementation shareholders, resulting in the fair treatment of of development policies and strategies that the shareholders as well as the transparency comply with ethical principles, and quality of any information transmitted, - social responsibility through a commitment - the rules relating to the roles, missions, beyond the finality of profit, to become a composition, functioning and committees of socially responsible company concerned about the Board, its social environment, - the relationship between the Board, the General - corporate governance through an application of Management and the Managers, the basic principles of the Senegalese Institute - the Board and the auditors, of Directors (ISA), including the integrity of - the Board and other stakeholders. management, the clear and respected definition of roles between the Shareholders’ Meeting, the Since 2012, Sonatel has also been referring Board of Directors and General Management to the Code of Conduct for Private Sector and, finally, the respect of shareholders’ rights Enterprises in Senegal developed by the Private and equality in their treatment. Sector Coalition against Corruption (Coalition du Secteur Privé contre la Corruption, or CSPC), These codes are available from these institutions.

21 PRINCIPLES AND RULES 1.7 GOVERNING REMUNERATION AND BENEFITS GRANTED TO CORPORATE OFFICERS

The remuneration and benefits of corporate This Committee makes a proposal to the Board officers are determined in accordance with the of Directors, which will make the decision. provisions of the AUSCGIE: it was an initial decision of the Board of Directors. The Board of Directors Meeting n° 141 of February 02, 2012 set the duty allowances which are only The directors’ duty allowance set by the Board paid to the directors present at the relevant of Directors must, however, be validated by the meetings (Board of Directors, Audit Committee). Ordinary General Meeting. An overall budget had been allocated by the Prior to this legal procedure, since April 2008, Ordinary General Meeting of Sonatel of 08 April, Sonatel has set up an Appointments and 2009. Remunerations Committee in charge of making proposals to the Board on: This amount of the budget is 65 million XOF per - directors’ allowances, year. - SONATEL’s remuneration policy for corporate officers, and - the remuneration, mobility of senior executives and Sonatel’s employee shareholding policy.

22 Sonatel Annual Report 2018

TOTAL REMUNERATION AND 1.8 BENEFITS OF ALL KINDS PAID TO EACH DIRECTOR OF SONATEL

During 2018, the Board of Directors of Sonatel attended meetings (Board of Directors and Audit met five (5) times, the Audit Committee, three (3) Committee) or their delegates in the following times. amounts:

During the 2018 fiscal year, the directors’ allowances were paid to the directors who

Board Audit Directors Total of Directors Committee M. Abdoulaye DIOP XOF 4,000,000 XOF 4,000,000 M. Thierno FALL/M. Koly FAYE XOF 2,400,000 XOF 2,400,000 Mme Fatoumata SARR DIENG / XOF 2,400,000 XOF 2,400,000 M. Hugues FOULON M. Bassirou Samba NIASSE XOF 3,200,000 XOF 1,600,000 XOF 4,800,000 M. Mamadou Aidara DIOP XOF 4,000,000 XOF 4,000,000 M. Fabrice ANDRE / XOF 3,200,000 XOF 3,200,000 M. Jérôme HENIQUE M. Ludovic PECH XOF 2,400,000 XOF 1,600,000 XOF 4,000,000 M. Bruno METTLING / XOF 7,000,000 XOF 7,000,000 M. Alioune NDIAYE M. Thierry BRETON XOF 800,000 XOF 800,000

General Total XOF 29,400,000 XOF 3,200,000 XOF 32,600,000

The above distribution is in line with the overall the Ordinary General Meeting of Sonatel of 08 annual amount of 65 million XOF allocated by April, 2009.

COMMITMENTS UNDERTAKEN FOR THE 1.9 BENEFIT OF CORPORATE OFFICERS

No commitment has been made by Sonatel for the benefit of its corporate officers for the 2018 financial year.

23 LIMITATIONS OF THE POWERS OF 1.10 THE DIRECTOR GENERAL

The Director General is vested with the broadest the Director General above which the prior powers to act in all circumstances in the name of authorization of the Board of Directors is the company. He exercises his powers within the mandatory. limits of the corporate purpose and subject that the law and the internal regulations of the Board This limitation of the powers of the Director of Directors expressly confer on him. General was also enshrined in Article 13 b of Sonatel’s Articles of Association. Since 1997, however, the Board of Directors has set a ceiling on the commitments of

INTERNAL RISK CONTROL AND 1.11 MANAGEMENT PROCEDURES

Sonatel has had a process of internal control and - the annual audit of compliance with the risk management for years. financial security laws and the Sarbanes Oxley Act applicable to companies listed in the US The activities and results of this internal control due to the fact that SONATEL is a membber and risk management process are monitored by of the Orange Group (review of internal control the Audit Committee. environment questionnaires by the Auditors for Validation). For the effective and efficient management of this process, there are monitoring structures and a specific organization for the management of committees at Sonatel: ethics and compliance: a dedicated department in charge of risk - a Department dedicated to steering and management and internal control, whose main facilitating compliance. It is in charge of setting responsibilities are: up and monitoring anti-corruption and conflict - the development and regular updating of risk of interest mechanisms to ensure compliance maps related to the activities of all Sonatel with Sonatel Group’s zero tolerance policy on processes (identification, treatment, evaluation corruption. and prioritization of risks), - a CSR, Ethics and Compliance Committee - the management of the top risks (priority risks chaired by the Director General, which meets and unacceptable risks) defined by the General quarterly. All members of the Management Management, Committee are members of this Committee, - risk analysis related to strategic offers and - a Chief Compliance Officer (CCO) appointed projects, by the Director General: The Director of Audit, - the systematic review of procedures to ensure Risks and Quality, responsible for coordinating the integration of internal control mechanisms and supervising the effectiveness compliance covering risks, actions in the Sonatel Group, - the provision of suport to the professions for - an ethics Sponsor: The Director of Human the development and ownership of the internal Resources, control,

24 Sonatel Annual Report 2018

- a CSR, Ethics and Compliance network with a Risk Committee chaired by the Director a coordinator, facilitators by domain and General and composed of all the Directors and correspondents by management department. Heads of Security, Revenue Assurance, Risk Management and Internal Control Departments. an Internal Audit Department to evaluate the The purpose of this Committee, which meets internal control system (tests to ensure the every six months, is to: correct application and effectiveness of the - analyze the top risks (priority risks and documented internal control system). The unacceptable risks) defined by the General Internal Audit’s main responsibilities are as Management to ensure their control, follows: - identify and stimulate the necessary synergies - the development and implementation of an between the different functions involved in risk annual audit programme covering SONATEL’s management, strategic orientations and issues in all areas, - the preparation of internal control reviews and particularly those exposed to critical and follow-up of the conclusions of the review. unacceptable risks, - monitoring the implementation of internal and a Risk Review Committee related to SONATEL’s external audit recommendations. strategic projects and offers whose role is to: - ensure that the risk dimension is considered in a General Inspection Department responsible the projects or worksites before they pass on for: for validation; - carrying out investigation missions subsequent - ensure that projects that are required to pass a to the following causative events impacting validation stage include the appropriate control SONATEL or a third party: mechanisms that are necessary to achieve the various objectives and circumvent, anticipate, fraud or suspicion of internal or external fraud, correct or reduce the impact of the identified theft and embezzlement, risks. corruption or attempts at corruption and breaches of ethics, The results obtained to date are positive and non-compliance with laws, regulations, constant monitoring is being conducted to contracts, policies and procedures that cause effectively contribute to the sustainability of harm to SONATEL or a third party, SONATEL’s business. major human or technical failures. - following up on the recommendations emanating from the investigations, - ensuring reporting at the group level on surveys.

25

HUMAN RESSOURCES

2The «DHR inside» for a better participation in the Sonatel Group Vision

Being in a permanent and dynamic listening This process of openness is beginning to bear mode attentive to its staff’s needs to develop fruit with: its potential is the new foundation on which the - the signing of the Memorandum of Understan- Sonatel Group’s approach is based. This posi- ding on the claim platform of the inter-union tioning enables it to participate in «offering an workers of Sonatel in a very serene environ- incomparable experience to its Customers and ment, other Stakeholders» and to contribute signifi- - the strengthening of the social climate with the cantly to the achievement of the strategic ob- establishment of the Social Dialogue Com- jectives resulting from the Sonatel Group Vision mittee and its 3rd coordination session chaired 2022. for the first time by the Director General, - the renewal of our «Top Employer Senegal» It is in this context that in July 2018, the Human and «Top Employer Africa» certificates for the Resources Department, with the participation of 6th consecutive year. This award recognizes social partners and experts, organized a semi- initiatives that aim for the highest standards nar. The brainstorming focussed mainly on the of excellence in the management of working following themes: social policy, expectations of conditions and human resources. managers, best place to work, mobility and ver- satility of staff of the Department of Human Re- Started in 2017, the digitization of HR processes sources, the guarantee on employability for the continues and agility abilities are reinforced to jobs of the future, inter-structure relations and be at the forefront of Sonatel’s transformation. the revaluation of the HR (Human Resources) function. DEVELOPMENT OF SKILLS: 2.1 ALIGNMENT WITH OUR FUTURE WORK

The alignment of skills with our future professions The Skills Center also played a major role in the was reaffirmed by the Director General when he training both in-house of the Sonatel Group and defined his vision of the Sonatel Group. of the MEA countries, namely: - Orange DRC: training of trainers, Assessment Thus, each year, Sonatel adapts its skills of trainers on the delivery of ACTES, Manager management programme to include new digital Sales Coach, coaching trainers in delivering the related initiatives with a dedicated budget. The Manager Sales Coach module, following major actions are carried out: - Orange Mali and Orange Guinea: training of - co-designing and deployment of skills partner distributors in management and team development plans for internal structures, coaching, - enhancing proficiency in English for the Top - Organization of a cursus session in Dakar with Management by changing the «seminar» format the participation of Orange Burkina, Orange to «individual classes” in order to improve the Guinea Conakry and Sonatel, language learning experience, - Niger: indirect distribution training «Retail ani- - staffing the new Information Systems mation», Department following the launch of its - Democratic Republic of Congo and Tunisia: industrialization project and the Digital Pole as training of trainers (certificate course), part of its creation, - Orange Morocco: training of trainers on Perfor- - 399 training sessions, 84 of which concern mance Management and Management of deli- projects, workshops or seminars in various cate sales situations, fields, such as the Fundamentals of - Certification of Orange MEA trainers. Management for Managers, the ESSEC Course, the Project Manager Courses, the M3 Module - The operational activities are increasingly sup- Change and Agility, digitalisation, E -Skills for ported by a digitalisation programme: the LMS E-Learning programmes with MOOCs designed project (training management platform), the HCM by our in-house trainers, etc. (Human Capital Management) project, the E-re- cruitment project, the Conciergerie, the health In 2018, the training comprised: insurance schemes (Mutuelle Sonatel de Santé (MSS) / IPM (Institut Prévoyance Maladie)), the - 17,206 student days (SD), Mobile and Web Yearbook, the Sharepoint Imple- - 1,279 employees attended at least one training mentation Project for the automation of reports, session in the year, the automation of Health & Hygiene activities in - 177 employees received training abroad the workplace (medical consultation and exami- - 103,724 hours of training completed. nation, stock management, medical evacuation, management of work accidents). The Sonatel Group function also rolled out via the Orange Training Center Campus, 12 modules with the participation of 177 managers from Senegal, Mali, Ivory Coast, Niger and Sierra Leone.

28

CAREER MANAGEMENT: OFFERING 2.2 EACH EMPLOYEE A UNIQUE AND CUSTOMIZED EXPERIENCE

Career management is a major focus of the HR various career management systems: the career transformation, in order to align with new trends committee, the transfer window of mobility, talent and meet the needs of each employee. Indeed, sharing and expatriation. employees are more interested in acquiring greater experience, rather than a classic The development of the expert sector, which is endeavour to climb the corporate ladder. an alternative to the classical management path, is a real career opportunity for employees. To meet this challenge, proper articulation is ensured between the Job and Skills Forecast Finally, spin-offs, a major innovation in the field of Mannagement (Gestion Prévisionnelle des mobility, now offers Sonatelians the opportunity Emplois et des Compétences, or GPEC), the to try an entrepreneurial experience. annual performance evaluation (SAPER), and the skills development programmes and the

30 Sonatel Annual Report 2018

HEALTH AND WELL-BEING IN THE 2.3 WORKPLACE: A DRIVER FOR A HAPPY AND EFFECTIVE WORKFORCE

Restructuring, for multiple reasons, has become tended by the Sonatel Director General accom- a daily practice in the world of organizations, and panied by the Seniour Management. This year’s our company is not immune to these phenomena. theme was «Life at work: my quality of life at Adjusting various policies is expected to improve work». economic output, and also help achieve the objectives of greater social cohesion while The achievement of the annual health checkups reducing inequalities in health. of the Dakar and regional staff without distinction with a coverage of 97%: Pursuing the deployment of its Occupational - 1,694 permanent staff were consulted out Health and Safety policy, Sonatel has boosted its of a global staff (Sonatel, SBS and OFMS) action plan through several actions: strength of 1,776 employees; - The listening and human performance - 963 temporary workers, trainees and other enhancement unit is a support mechanism providers also benefited from the medical launched in 2017. It already demonstrates its examination. importance and provides major results thanks to its programme-based animation plan: Traditional activities related to the preventive and individual coaching (206), dialogue circles (20), curative management of health, such as medical diet under the supervision of external experts visits, information, awareness and training conti- and trained agents (360), advisors (26). nue to be supported. - The operation of the Leisure Areas has entered its active phase with full-time occupation during From a curative standpoint, in 2018 we recorded breaks or other times chosen by employees. Its 38,381 medical services consisting of consulta- rollout plan will continue in 2019 on other sites. tions by the company doctor, consultations by nurses, nursing care, medical evacuations, vac- - Animating the sites through the Workplace cinations and recrutement checkups. Health and Safety Committee (WHSC) pro- gramme. The traditional WHSC seminar, at- THE INSTITUTE FOR HEALTH 2.4 INSURANCE OF SONATEL (IPM): A MECHANISM FOR THE WELL- BEING OF WORKERS

The medical coverage provided IPM Sonatel - a good management policy governing the win- (Institut de Prévoyance des Maladies) is a win relationship with service providers reference in the health system. - and a harmonious co-management with the social partners. It covers 8,049 beneficiaries including 1,955 in- sured agents for curative health care. This performance facilitated the appointment This good reputation is earned by: of its manager as Director within the Coordina- - actively listening to staff, other agents and ting Agency for Compulsory Health Insurance in contributors, Senegal (Institution de Coordination de l’Assu- - an improved digitalization of the customer rance-maladie Obligatoire au Sénégal, or ICA- experience with the new O’ Card version 2, MO).

THE RETIREE HEALTH MUTUAL (MSR): 2.5 A BRAND OF INTERGENERATIONAL SOLIDARITY BETWEEN ACTIVE WORKERS AND RETIREES

The Retiree Health Mutual (Mutuelle de Santé - delivery of the first health record booklets, des Retraités, or MSR) has strengthened its - Effective start of medical coverage activities organization and operation: - approval of the since 01st April 2018, Statutes and Internal Regulations of the Mutual - establishment of a solidarity fund, by the Universal Health Coverage (UHC) and the - full coverage of 36 retirees exempt from Ministry of Health, - approval of the Ministry of membership fees and contributions, Health by decree n° 4614 of 02 March, 2018, - free care for 16 wards, families of 04 deceased - Registration at the Ministry of Finance under members, the NINEA 006788163 of 06 April, 2018, - annual subsidy granted by Sonatel to support the - 467 effective members for 1,011 beneficiaries - mutual, apart from the necessary logistics and 50 local correspondents, payment of the salary and other emoluments of - appointment by Sonatel of a network of 12 the manager. correspondents for the mutual, - selection and signing of contracts with 100 health providers,

32 Sonatel Annual Report 2018

2022 CORPORATE PLAN: 2.6 «A MOBILIZING AND FEDERATING APPROACH IN THE NEW VISION OF THE SONATEL GROUP»

Our sector has experienced in recent years a series 3. To be the preferred and trusted partner of our of rapid and very important transformations. The major stakeholders. Sonatel Group has adapted to become a success 4. To renew the Human Resources policy and story in the telecommunications sector, counting align skills with the new ambition. on the relevance of its strategic choices and the 5. To open up our enhanced connectivity for di- quality of its human resources. gital transformation by fostering value creation Today, we are witnessing unprecedented for stakeholders. breakthroughs in the telecommunications environment and a real digital revolution. Thus, This new corporate plan was officially launched new business models and practices have by the General Manager in December 2018 in emerged, encouraging new forms of competition the presence of the seniour management, Social and requiring appropriate approaches in our Partners and Ambassadors of the Sonatel 2022 relationship to work, how we collaborate, Corporate Plan to share this new vision and communicate and create value. define its strong expectations. Faced with these major challenges, the Director General has set out a new trajectory to better The main thrust of the vision is summarized address them together with all the stakeholders as follows: «We have a vision and five major involved, by defining a new Vision 2022 based outcomes to achieve. We must win every battle. on five major outcomes which will underpin the And I count on each and everyone of you, each Sonatel 2022 Corporate Plan: and every employee and stakeholder». «Sonatel in 2022, a resolutely customer- centred Group and special partner in the digital transformation of our companies».

1. To transform Sonatel into an agile, open and customer-centred organization. 2. To become a multi-service operator thanks to an active partnership policy in the digital eco- system.

33

3 CIVIC ENGAGEMENT IN SENEGAL AND IN THE SUBSIDIARIES THE SONATEL GROUP, AN OPERATOR 3.1 COMMITTED TO THE ECONOMIC AND SOCIAL DEVELOPMENT OF ALL COUNTRIES OF PRESENCE

In addition to its certification in the energy field, Corporate Social Responsibility (CSR) is at the the Sonatel Group received in September 2018, heart of our strategy and we are committed to the AFNOR Certification, the CSR Committed the issues of CSR and Sustainable Development. Label attesting its contribution to sustainable Our goal is to place sustainable development at development consistent with the ISO 26 000 the heart of our company’s DNA, its vision and its standard. relationships based on the four defined areas of focus and considering the central issues: Its score of 606 points out of 1000 in the top tier of the third «confirmed» level of the AFAQ 26000 Community Well-Being, Good Governance, model. Growth and Economic Development, Environmental Conservation. This recognition confirms the continuous im- provement approach put in place by the Sona- With this responsible commitment, the Sonatel tel Group for more than 10 years. In 2018, the Group strives to meet the expectations of its Corporate Social Responsibility policy letter was stakeholders, after listening to their concerns adopted considering the seven central issues through several mechanisms. that, according to the international benchmark, must guide all sustainable development actions.

Economic Community Preservation of Good Growth & well-being the environment Governance development

Governance

Community Consumer Relationships and local related Human Environment and working Loyalty of development issues rights conditions practices

36 Sonatel Annual Report 2018

3.1.1 Civic engagement in Senegal

Community well-being

In 2018, we note the strengthening of the relationship with our stakeholders through the setting up of exchange and listening platforms such as «Pencum Sonatel», on topics in the sector of telecommunications and the digital economy.

In February 2018, a Pencum Sonatel was organized with parliamentarians and all the members of the Management Committee. It allowed the Honorable Members to get to know the Sonatel Group and its vision for the development of the digital economy through topics such as: - the network coverage, - the customer relationship, - citizen policy and CSR, - the impact of Sonatel’s activity in Senegal’s economy, - the social footprint of Sonatel.

With the Consumer Associations, Sonatel has set up periodic meeting frameworks in order to inform them about the main activities of the company and to give them new information in connection with the launch of new offers and/or price changes. Other meetings are organized to discuss certain issues in the sector.

These meetings also help address the concerns expressed by customers in their publications in order to improve the management of claims and address them effectively.

Further, visits to religious, customary and administrative authorities are organized regularly in Dakar and in the regions for a better understanding of issues in the communities.

The Sonatel Group continues to support all religious events by strengthening network coverage and rolling out the «Sonatel Clean Cities», programme, etc.

The reinforcement of the resources provided to the press is also ensured during these religious events through the setting up of the traditiona «Press areas» (free wifi connection, computers, etc.) which facilitates the work and coordination of journalists.

37 Construction of a multifunctional space at Keur Gorgui

In order to contribute to improving the living environment of the Cité Keur Gorgui neighbourhood where its headquarters are located, the Sonatel Group has offered local residents a multifunctional space consisting of a multisport field for football, basketball and volleyball, and a play area designed for children with swings and turnstiles.

Diversity

Several initiatives were rolled out in 2018 for gender equity, disability support and diversity in general. Sonatel Annual Report 2018

Celebration of the International Day of Women’s Rights

In 2018, the theme of the day was «Empowering rural women and girls». This was an opportunity to officially launch in Senegal the #HeForShe global campaign. This was a UN-Women initiative of which the Sonatel Group was one of the pioneers when it was signed in 2015 by all the men in the Management Committee.

The Sonatel Group has also participated in various activities organized by partners such as the Ministry of Women, Family and Gender. More than 10,000 women from the country’s 45 departments mobilized for the flagship event marking the start of the March activities dedicated to women at the Iba Mar Diop stadium.

Various meetings for diversity

To affirm its commitment to diversity, the Sonatel Group participates in and co-hosts national and international meetings and workshops on the subject. This is notably the case of the Senegal diversity business meeting charter, the Diversity Charter Workshop, etc.

These meetings were an opportunity for the Sonatel Group to share its best practices and higlight its Gender responsiveness through the seven principles of CSR.

The 7 principles Our answers

1. Reporting Actions related to Diversity + CSR Report 2. Transparency Testimonial + Indicators of the Diversity Charter Ethics & Diversity Training (Women’s Day) Dissemination of Sonatel’s 3. Ethics values in homes through the women of Sonatel / Impact DD 4. Respect for stakeholder Dialogue with the Staff Delegates and the Women’s Association with interests specific points on Gender responsiveness Compliance with the provisions of the Labor Code and Health Policy 5. Legality & Well-being at work. Example: cervical cancer prevention, gym, etc. 6. International standards of behaviour Community engagement and sponsorship actions for women and 7. Human rights girls (Education and Health)

The CSR & Women leadership workshop organized by the Canadian Embassy in Senegal and the Senegal CSR Initiative as part of the activities of the Senegal Enterprises Diversity Charter was also an opportunity to revisit the place of women within companies, integrate the gender dimension in CSR policies and analyze the difficulties faced by business leaders (men and women) in practising gender equality in Senegalese companies. It will trigger brainstorming on the role and place of women entrepreneurs and women business leaders in the Senegalese private sector. It should be noted that we are pioneers in this area, the steering committee being made up of 40% women.

39 60 disabled children equipped

The celebration of the International Day of Persons with Disabilities was an opportunity to offer orthopedic equipment to 60 children with severe motor disabilities in Niaganiao on 3 December.

This choice was in line with this year’s theme: «Empowering People with Disabilities and Ensuring Participation and Equality», which focuses on inclusive, equitable and sustainable development under the 2030 Agenda for Sustainable Development.

In the context of diversity, we also support Handisables International, an association whose mission is to provide rehabilitation care for children with disabilities in Senegal.

Support for the protection of the Mentally Disabled

For 16 years, the Sonatel Group has been supporting the Senegalese Association for the Protection of Deficient Children (Association Sénégalaise pour la Protection des Enfants Déficients, or ASEDEME) during its traditional fundraising organized on the sidelines of a golf tournament. This event makes it possible to raise most of the funds intended for: - construction and development work, the maintenance and operation of the Aminata Mbaye Centers (CAM) in Dakar and St Louis, dedicated to children with mental disabilities; - better care and better integration of children living with an intellectual disability and promote the dynamics around their vocational integration.

Good governance

Good governance not only requires strengthening the relationship with stakeholders through regular exchanges but also setting up an audit committee, monitoring, risk management, an ethics policy and compliance, etc.

Economic Growth & development

In the field of digital economy, we want to be recognized as a digital partner of the State and incubators/ enablers.

This commitment was manifested through several actions in 2018.

- Involvement in the «Digital Senegal 2025» programme Sonatel has contributed to the development of the «Digital Senegal 2025» strategy, which, by accelerating the development of the sector, aims to provide access for the greatest number of people to a more affordable and better Internet.

40 Sonatel Annual Report 2018

After Act 1 towards «Digital Senegal 2025» in February 2017 with an average 25% drop in Mobile Internet tariffs, the Sonatel Group rolled out Act 2 in January 2018, thus achieving the target of the 50% reduction set by the government a year ahead of schedule.

Through this first step, combined with the accelerated programme of 4G roll out in regional capitals and customer access to fibre optics, the Sonatel Group contributes to achieving the government’s strategy to place Senegal among the top 5 best-connected African countries.

Today, the 14 regional capitals of Senegal and the most populated cities are fully connected to mobile broadband internet. The complete coverage of major cities by Orange 4G coincides with the progressive commissioning of 4G+.

Participation in the flagship events of the digital ecosystem

In addition to the Francophone Forum in Dakar, the Sonatel Group notably supported the Africa Internet Summit as part of its policy to support the Govenrment of Senegal’s 2025 Digital Strategy. The AIS is the annual summit of subregional educational and business ICTs where key players in the Internet industry can interact with the global Internet community and discuss ICT issues and challenges.

Other meetings made it possible to play the role of catalyst of the digital ecosystem: Monthly connecTIC of E-entrepreneurs, Global Entrepreneurship Week with Jokkolabs.

First event of its kind, characterized by innovation, Startup Bakk Arena aims to provide startups with a framework of expression and a forum to communicate about their projects. This is a pitch contest, preceded by a call for applications in all fields. The first edition of Bakk Arena was organized by CTIC in partnership with the Sonatel Group.

Startup support

The Sonatel Group’s support for startups involves three stages: - Training - Animation - Acceleration.

The training phase

- Graduation of the 1st batch of students of Sonatel Academy: inclusion and equal opportunities It has been a year since the Sonatel Group launched the initiative to train young people in digital professions for free through the creation of Sonatel Academy. Inaugurated in November 2017, Sonatel Academy’s main mission is to improve the employability of young people and to enable them to master the «e-skills» they need to prosper in the digital economy of the 21st century.

For one year, a dynamic and multidisciplinary team supervised, trained and supported Sonatel Academy’s first batch of students on the acquisition of knowledge and skills, through inverted classroom pedagogy, by putting into practice individual or collective projects, co-learning and peer assessment.

41 After 984 hours of training in Web Development Skills and 20h of SK, forty-six (46) candidates were presented for the «Web Developer» Certificate of Specialization with the assistance of the Ministry of Vocational Training, apprenticeship and handicrafts, the 1st certificate of its kind in the field.

The results obtained are encouraging: 97.8% success rate and an average score of 15.7/20; with the girls winning with a 100% success rate.

The result of the batch of students at the end of their internship is satisfactory with a positive success rate of 63%. Learners of the «Alioune Ndiaye batch» (Former Director General of Sonatel and current Chairman of the Board of Directors) received their diplomas at a ceremony graced by the presence of their families and the competent authorities.

Sonatel Academy is one of the major achievements of the Sonatel Group’s responsible positioning as a major player in the ecosystem. This initiative confirms the Group’s commitment to work for the creation of values and jobs in the service of the people.

In the light of the results achieved with this first batch, and aware of the very high demand for training, the investment will be boosted in 2019.

- The number of learners will increase from 50 to 300 for the second class, including 100 in class and 200 in Online blended, a six-fold increase. - A multifunctional room will now host the Super Coders programme with the ambition of introducing one thousand (1,000) children to the Code per session (in Dakar and in the regions). - Three (3) new job description databases will be on the programme: Datartisan (data specialist), Referent Digital and Dev Mobile. Sonatel Annual Report 2018

Boost Your Business Gender Master Class

Boost Your Business is a programmeme launched by Facebook to support small and medium-sized businesses with better control over their various tools. Thanks to a curriculum built with local experts to meet the needs of entrepreneurs, this programme makes it possible to meet entrepreneurs, closer to their daily business and share good practices by discovering management and creativity tools. Sonatel supports the programme by organizing the 14/11 Masterclass 100% dedicated to women entrepreneurs.

Digital inclusion of Juniors

In order to participate in the digital inclusion of young people, the Sonatel Group, in partnership with the startup mJangalé, organized two initiation sessions on the code last December around the Fashion Tech (dedicated to girls aged 13 to 18 years) and Mobile Development with MIT App Inventor (for a mixed audience aged 13 to 18).

These two modules, supplemented by personal development and pitch coaching courses, proved to be a real indicator of capacity among young beneficiaries. This session also welcomed young children from the SOS Village who demonstrated innovation through applications with an environmental or health impact.

The animation phase

Buzz start up relocates to the suburbs! ‘’Buzz start up’’ is a platform for exchange and sharing with Senegalese startups. This year, for its 3rd edition, the Buzz has been relocated to the suburbs to identify nuggets in outlying areas, in partnership with the owners of startups.

Let’s meet up: APIs at the Service of business Many developers met on 18 October 2018 at Sonatel headquarters in Dakar for the «Let’s Meet Up» on APIs organized for them by Sonatel. This third edition was a platform for exchange and sharing with stakeholders in the Senegalese digital ecosystem. The Let’s Meet Up theme was: «APIs, business accelerators». Experts in the field exchanged with the public on the importance of using APIs to develop their startups. According to the organizers, «Let’s Meet Up» is a framework for exchanges between players in the digital ecosystem to provide startups with expertise that can improve their performance.»

First Digital Society Forum (DSF) Workshop on «The Impacts of Digital on Employment» Following the launch of the 1st edition of the Digital Society Forum (DSF), held in December 2016, the Sonatel Group organized in February 2018, at the large amphitheater of the Polytechnic School of Thiès (EPT), the 1st follow-up workshop on the impacts of digital technology on employment.

As a reminder, the Digital Society Forum (DSF) is an open collaborative platform intended to provide the largest number of people with keys to better understanding our digital life.

This specific workshop was mainly intended for students and members of the academic sector, allowing them to debate together on the theme that remains a key topic of this 21st century in which ICTs occupy a prominent place.

After the introductory lecture delivered by an expert sociologist, the guests were able to discuss in two panels dealing respectively with employment opportunities in the ICT sector and from the point of view of ICT employers. Prominent economists, scientists and socio-anthropologists also took part.

43 From the details presented at the introductory conference and the panel, it appears that Information and Communication Technologies are ubiquitous today and that real opportunities exist for training in this field. New synergies between training institutes and companies need to be put in place as well as skills-based teaching practices.

The acceleration phase

Third season of Orange Fab In 2018, Orange FAB accelerated four (4) startups (JALO, Paps, Eyone and Elok Solutions) with a budget of 10 million per company, more than 50 hours of coaching with thirty experts from Sonatel and a local and International «demo day» (in Paris during Vivatechnology).

Five of the eight startups in the three (3) seasons of Orange Fab have benefited this year from funding by DER.

Together to get my start-up off the Orange Fab E-commerce - Fintech E-Santé Season 3 Until april 18 register on www.orangefab.sn

44 Sonatel Annual Report 2018

In 2018, Linguère Digital Challenge is in its third edition! Linguère Digital Challenge has the same objective as Orange Fab, but is exclusively dedicated to women entrepreneurs who are active in digital or have a business relying on digital tools.

Thus, at the end of the three editions of Orange Fab and Linguère Digital Challenge, 12 startups were rewarded at the financial and logistical levels (training, technical sup- port, etc.).

Some startups that won one of the prizes in previous years have developed and have be- come true sucess stories and the pride of the ecosystem.

Upscaler powered by Sonatel

Kinayab powered by Sonatel is a pre-acceleration startup programme. Since May 2018, 10 startups arising from Linguère Digital Challenge and the Orange Social Entrepreneurship Awards in Africa and the Middle East have benefited from high quality mentoring, business opportunities and international access. Kinaya Lab is a startup acceleration programme dedicated to entrepreneurship in Francophone Africa. This month, the organization is continuing its programme of startup acceleration, this time mixed but including many female players who have already proven themselves by winning contests related to startups. In addition to a mentoring system, startups in acceleration are talking to potential investors and strategic partners.

Environmental Protection

Our ambition is to be a reference in terms of CSR in our countries of presence. Today, in Senegal, the Sonatel Group is recognized as a CSR committed company and a major player in the fight for the preservation of the environment and a special partner of the Ministry of Environment and Sustainable Development. It is thus a member of the Strategic Committee set up by this state body and supports the measurement of air quality for health protection.

45 Various actions to celebrate World Environment Day (WED)

To mark its civic commitment to sustainable development, and more specifically to the preservation of the environment, the Sona- tel Group celebrated World Environment Day through several citizen actions in collabora- tion with its local partners, state structures, private, academic, research and local and international non-governmental organizations (NGOs). - The installation in Tivaouane of a Récuplast kiosk for the collection and recycling of plastic waste.

- Planting 500 trees in Toubacouta, Fatick Region, as part of the fight against defores- tation, with support to the Nebeday Asso- ciation.

- Sensitization sessions at the CEM of Djedda Thiaroye Kao in Pikine on the evils of single- use plastic, with the support of Senegal Propre.

- The support of the Institute of Environmental Sciences (ISE) of Cheikh Anta Diop Univer- sity (UCAD) which organized reforestation sessions, exhibition, panel, set setal, and an awareness caravan from 31 May to 05 June.

Environmental Education

Since preserving the environment calls for education from an early age, the Sonatel Group has initiated the sensitization of children on the ecological footprint during its summer camp.

A fun awareness morning was organized for 150 Sonatelian children on Sunday 29 July 2018, in partnership with Prof. Tidjani, Founder of the Institut des Métiers de l’Environnement et de la Métrologie (IMEM).

The purpose of this informative recreational activity is to train aspiring Green Ambassadors. Raising the awareness of this young target group will enable them to acquire the basics of environmental preservation, waste reduction, global warming, the fight against air pollution and to adopt green gestures.

Recycling and circular economy

These actions complement the plastic waste recycling programme. The first kiosks have been installed in a few municipalities, including Patte d’Oie this year, with a partner who transforms collected plastics into useful objects (baskets, garbage bins, etc.), thereby creating a real circular economy.

46 Sonatel Annual Report 2018

And Defar Sunu Gox Grand Yoff or «Sonatel Clean Cities»

This programme to fight against an unsanitary environment and plastic pollution continued this year at the municipality of Grand-Yoff in partnership with the City, the UCG and Proplast, thanks to the mobilization of associations, authorities and local populations.

The launch of this civic action has allowed Grand Yoff to benefit from an upgrade to improve the living environment of its population. Thus, in the region of Dakar, after Médina, Yoff and Golf Sud, this commune has benefitted for a week from various cleansing activities in the fight against insalubrity in the neighbourhoods: sweeping, desanding, weeding, eradication of wild deposits, waste disposal and landfilling.

The Sonatel Group contributes to improving the living environment of municipalities and strengthens its position as a major player in civic engagement and environmental preservation.

Other actions to fight against insalubrity have also been conducted in parallel, such as cleaning beaches in partnership with the Senegalese Football Federation, as part of the Beach Soccer Tour.

Supporting the COP 24 in Poland

More than one hundred and fifty (150) States participate in the COP (Conference of Parties), an international conference of parties on climate change, with approximately 25,000 visitors.

The Sonatel Group’s contribution to this international event follows its participation in national conferences on national sustainable development since 2015.

During the 2018 climate summit, Poland showed how neutrality in terms of greenhouse gas emissions, ie a balance between CO2 emissions and CO2 sequestration by soils and forests, can be achieved.

3.1.2 Civic engagement in the subsidiaries

In Mali, committing to a policy of Corporate Social Responsi- bility on a daily basis

At Orange Mali, our CSR policy aims to support economic and social development. Our Corporate Social Responsibility reflects our conscience, our desire to guarantee the most positive impact possible on people, society and the environment in Mali.

47 - Supporting development actions 32 Malian entries were submitted for the Orange Award for Social Entrepreneurship in Africa and the Middle East. The award ceremony organized for the national winners of the 8th 2018 edition took place at the headquarters of Orange Mali.

The goal is to promote social innovation for development through ICTs.

The 3 best projects selected this year are: - 1st Prize: MAP ACTION - 2nd Prize: ZIKMALI - 3rd Prize: OKO Mali

- Launch of the pilot phase of the ATIC project The ATIC project was initiated in 2016 by a consortium of Aide et Action Mali, the Orange Group, Orange Mali, Basic Internet Foundation, Orange Labs and the Ministry of Education of Mali following a call for proposals from the Agence Universitaire de la Francophonie.

It aims mainly to improve: - the professional skills of 840 teachers (including 120 school principals) in the primary cycle in science and mathematics education; - the educational supervision coverage rates of two Academies d’Enseignement / AE (24 tutors recruited among the educational advisers and 10 inspectors).

- Official launch of HNI 3 2 1 Service An on-demand free information service accessible by moile phone for remote communities in developing countries.

Simply dial 37 3 2 1 to listen to a relevant information message, anywhere, at any time, in a free and confidential way.

- Realization of an m-Health stakeholder dialogue with the objectives of: - capturing Mali’s key issues around Orange Mali’s themes of responsibility; - assessing the level of general satisfaction of stakeholders on these themes; - collecting the new expectations of the stakeholders; - identifying innovation opportunities opening up new development prospects for Mali and growth for Orange Mali.

48 Sonatel Annual Report 2018

In Guinea, Orange Guinée confirms its civic commitment

By the end of 2018, nearly 45 schools embarked on its Digital Schools programme, which, through the introduction of digital kits made up of tablets and a server containing more than 60,000 books, gives children access to the digital world to ensure their retention in schools while facilitating the work of their teachers.

The responsible use of digital has been encouraged by the #Supercodeurs workshops. Thus, nearly 300 children were introduced to coding in Conakry, to the great pride of their parents.

Orange Guinée’s commitment to Guineans has also been expressed through its interventions in the field of entrepreneurship. Thus, the Social Entrepreneur Award has rewarded three winners in its national phase and especially allowed the launch of startups engaged in crowdfunding, agriculture or delivery.

Further, Orange Guinée took part in various exhibitions and workshops such as the digital week, Saboulinkeds (exchanges between actors on topics such as financial inclusion) organized by the Saboutech incubator whose operator is a founding member.

The environment also remains a major challenge for the Guinean subsidiary. The launch of the Solar Energy Service is the beginning of a response and was launched in the pilot phase in Doko (in Guinée Forestière). The launch addresses both the needs of Guineans in this locality who have no electricity, but also the challenges of sustainable development in its environmental dimension.

49 ... In Guinea Bissau,

In 2018, Orange Bissau strengthened its support for women and young people through a number of key actions: - Organization of the local competition for the Orange Prize for social entrepreneurs in Africa and the Middle East (POESAM), - Support to the Federation of Women’s Associations AMAE, - Sponsoring the1st edition of the African Science & Technology Week in Guinea Bissau. The objective is to promote the technological and digital development of Africa and to encourage the holding of scientific and technological events throughout the continent. This was an opportunity to organize the 1st Seedstar competition for startups in Bissau.

In Sierra Leone

- M-Women In order to support women’s entrepreneurship, we launched a pilot project to help five women traders through a material and financial contribution (sale of scratch cards, sims and Orange Money).

- Health and women In collaboration with our partners, we have offered health products to women, particularly at puberty, which is an important part of our contribution to the government’s FQE programme. We are also working with our public network to advertise our freephone numbers so that women who are distressed or at risk of domestic violence can report it to the appropriate authorities for help. This is done anonymously and helps protect this vulnerable population.

- Mentoring We will launch a mentoring programme for final-year students, providing networking advice and support to influential role models and internships. This project will be carried out with the support of the Group at a rate of 50%.

- Supercoders programme We recently completed the in-house launch of our free supercoder programme for employees’ children. This programme has been successful and has brought together more than 80 children aged 7 to 16 years.

Staff volunteered to train supercoders, providing coaching and mentoring for two weeks.

This project will continue and we want to develop it in the future to make it a Supercoder Academy providing more advanced coding and robotics to our children.

The next step of the «Supercoders» programme is the external launch with a special focus on girls aged 7 to 16, to reaffirm our desire to introduce ICT through coding, while taking Gender into account.

- Support for the digital ecosystem Many initiatives have also been rolled out to:

- promote technological startups, - identify incubators, - support events in the ecosystem such as the Freetown Frist pitch night, - train and finance businesses (up to 60,000,000 SLL) with a special focus on women.

In 2019, two companies in the ICT sector will enter the Orange Social Venture Prize.

50 Sonatel Annual Report 2018

PATRONAGE: CIVIC ENGAGEMENT 3.2 FOR DISADVANTAGED POPULATIONS

In Senegal

The Sonatel Foundation: 16 years of commitment to the well-being of the people!

Since its creation in 2002, the Sonatel Foundation has been working on a daily basis, at the heart of people’s lives throughout Senegal, in the areas of Health, Education and Culture.

In 2018, through achievements with a strong social impact, it reaffirmed its desire to make a significant contribution to national solidarity efforts as a way of making the Sonatel Group play its full role as a corporate citizen.

3.2.1 «Village» projects: an integrated concept to encourage and support the emergence of rural areas

As part of its overall mission to support public authorities, the Sonatel Group is positioned as a major player in economic development in all its countries of presence. Its «Village Project» concept, set up in conjunction with the Orange Foundation, is a concrete example with nearly 15 projects in three countries over the past three years.

In Senegal, the Sonatel Foundation, following the success of the «Village» projects in Thicatt Wolof in 2016, in the Kaffrine region, and SOB 2 in 2017, in the Kaolack region, inaugurated in 2018 its Village Project 3 in Mbakhna located in the Département of Matam, precisely in Bokidiawé Commune. This locality, which lacked basic social infrastructure, thus benefited from a support of 250 million (250,000,000) CFA Francs, which raised the budget invested for the 3 Village Projects to nearly a billion.

Mbakhna has been provided with a set of facilities: a 6-class elementary school fully renovated and equipped, a newly built and equipped health post, a housing for the Chief Nurse (Infirmier en Chef, or ICP), a well for market gardening activities, solar energy and an aquaculture project. The inauguration ceremony of these facilities was held on 6 March, 2018, under the effective chairmanship of the Minister of Communication, Telecommunications, Posts and the Digital Economy.

The 4th Village Project, located in Sareme, in the region of Diourbel, will be inaugurated soon.

51 3.2.2 Health

The Sonatel Foundation also supports the Ministry of Health and Social Action in its high- impact programmes.

Hepatitis control

On World Hepatitis Day, which is one of eight official World Health Organization (WHO) campaigns for global public health, the support provided in 2018 has enabled five hundred (500) people to be screened and one hundred (100) patients to receive care for free for one year.

The fight against cancer

The Senegalese League against Cancer (Ligue Sénégalaise contre le Cancer, or LISCA), aiming to support any form of fight against this disease, organizes several activities to that end, including a fundraising campaign to facilitate care for patients with low incomes.

Given the scale of the phenomenon, the Sonatel Foundation has made a commitment to LISCA in its effort to provide aid to these poor patients suffering from cancer through financial support amounting to 10 million CFA Francs during the campaign initiated in May.

3.2.3 Education

A commitment to quality education for all.

Commitment to educating children in the poorest countries

The Sonatel Foundation, recognized for its commitment in the field of education and its contribution to the efforts of the State of Senegal, has been asked by the Global Partnership for Education to participate in the official Summit on the replenishment of resources.

The goal is to support national efforts to provide quality education and learning to children in the world’s poorest countries.

52 Sonatel Annual Report 2018

The promotion of excellence encouraged and supported since 2002 through the Senegalese General Competition

Faithful to its vocation to promote the culture of excellence in students, the Sonatel Foundation has once again supported the Ministry of Education in the organization of the 52nd edition of the official prize- giving ceremony of the Senegalese General Competition. A ceremony in their honor was organized at the Foundation’s Headquarters in order to give them their Back-to-School Bursaries in the presence of their Sponsor, Professor Iba Der THIAM.

Support for training and vocational integration of young people

Because the training and capacity building of young people is essential in any sustainable development process, the Sonatel Foundation has once again supported the Socio-Educational Center «Kër Don Bosco» for the renewal and reinforcement of its equipment, as well as the purchase of inputs to improve the operation of its workshops. The purpose of this center is to offer young people in situations of exclusion training in vocational certificate programmes geared towards their immediate integration into the labour market. Thus, the Sonatel Foundation supports the State of Senegal in its policy of promoting and creating jobs for young people.

53 3.2.4 Culture

As every year, the Sonatel Foundation has been present at major cultural events, aware of the importance of culture for the development of a country.

Participation in cultural influence

This year’s support was provided to the 13th edition of the Biennale of Contemporary African Art 2018, as well as the ADIDECO initiative in its workshop and exhibition project, the opening of which took place at the headquarters of the Sonatel Foundation in the presence of high-level authorities.

Commitment to preserve our heritage

The technical staff of the Thiès Decorative Arts Manufacture is now being supported thanks to the training-insertion programme on arts and crafts provided by the Foundation.

Thanks to this support since 2015, fifteen (15) young people have been able to follow a multiskills training focused on three crafts: tapestry, art ceramics and batik or fabric printing. They graduated at an official end-of-training ceremony in May.

In Mali

The Orange Mali Foundation: always closer to the Malian people The Orange Mali Foundation consolidates its patronage actions for the benefit of the Malian populations. Since 2006, it has worked with the authorities, public and private social actors, as well as NGOs in the fight against poverty and social exclusion. In 2018, as in other years, it has carried out many solidarity actions to alleviate the suffering of the population and for their well-being through it 4 areas of intervention: health, education, culture and solidarity for the fulfillment of essential needs.

The Orange Foundation, the foundation of digital solidarity, also acts to ensure equal opportunities for the greatest number of people. And because new technologies are a contributing factor, we are also making digital education our priority.

In the field of health

- Support for the fight against blindness and eye diseases › The realization of the 14th edition of the free ophthalmic caravan that has crisscrossed the cities of Yelimane, Tominian, Koutiala and Narena Kangaba: more than 5,000 consultations and 500 cataract surgeries. It is organized in partnership with the National Eye Health programme (programme national de santé oculaire, or PNSO) and the National Center for the Elderly (centre national pour les personnes âgées, or CNPAM), and entirely funded by the Foundation. › Support for the eye screening campaign in ten schools in Kolokani. 3,000 students benefited from free consultations and eyeglasses were also distributed free of charge to 300 children. This project, initiated by New Vision, a Swedish NGO, is supported by a consortium of partners including APIDOM, executive partner and World Vision Mali.

54 Sonatel Annual Report 2018

- Support for maternal and child health with the construction of a 2nd center for women suffering from obstetric fistula in the Koulikoro region.

- Strengthening the Malian technical health facilities with the donation of modern equipment to Point G and the Mali hospital as well as to referral and community health centers (CSREF and CSCOM). These facilities include: resuscitation respirators, resuscitation ventilators, pediatric respirators, multi- parameter scopes, embedded phototherapy incubators, mobile vacuums, etc.

- Support for the fight against tropical, metabolic and infectious diseases (malaria, diabetes, sickle cell disease, blindness...) with a strong contribution to eye screening programmes and cancer of the uterus.

- The donation of essential medicines for the 5,000 sickle cell patients regularly monitored at the CRLD and the 225 inmates of the Bollé prison for women and minors.

In the field of education

- The realization of the 6th and 7th Village Projects Orange in Kantila in the circle of Kita and Dioubeba in the circle of Bafoulabé.

- The donation of a school module 3 classrooms with latrines for the people of Dalala village in Kita circle. This new modern school will benefit 243 students.

- The deployment of 50 digital schools across the country, 16,000 students benefit from the programme. 70 schools will be equipped by the end of 2019.

- The opening of 2 digital houses in the district of Bamako for digital initiation and training in financial management, accounting and simplified marketing for 113 women and girls. It is an opportunity that they are given to find employment and regain their financial autonomy.

- School sponsorship 1,410 underprivileged children including the mentally, hearing and visually impaired.

- The award of 20 scholarships for excellence to deserving students from disadvantaged backgrounds. 30 students have already obtained their first degree under this programme.

- The promotion of excellence in schools with support for the winners of competitions and other awards (Wiki challenge, the manuscript fair, the spelling and reading competition) with prizes consisting of computers, dictionaries, books and teaching materials.

Solidarity component

- Food solidarity for 1,700 people through the reception and accommodation centers for orphaned children or children in difficult circumstances.

- The organization of a solidarity day by the Orange Mali Foundation, every October, with various donations expressing its active solidarity with vulnerable populations and support for the efforts of the State.

- Financing 20 young people in entrepreneurship as part of their empowerment and socio-professional integration and to promote equal opportunities for young people in difficulty and prepare them for the jobs of the future.

55 - Contribution to the actions of Samusocial Mali and the Directorate of Civil Protection.

- The donation of income-generating materials supporting the activities of women’s groups to improve their living conditions.

Culture component

The Orange Mali Foundation, convinced that culture is a factor of development, has this year supported several festivals and cultural events throughout the country (theater, dance, cultural programme...): Ginna Dogon festivals, Didadi de Bougouni, Jazz Koum Ben, Weltarée show, Dense Bamako Danse, Guimba National Theater Days, etc.

In Guinea

In 2018, the programmes of the Orange Guinea Foundation helped support communities both in the field of education - for children and women - and that of health.

- Launch of the Digital Homes concept Like Senegal and Mali, the first Digital House, inaugurated in Coyah this year, helped train and introduce women particularly to literacy. It also encouraged the setting up of two new houses in Conakry and Dabiss.

- Strengthening the «Village» Project The Orange Guinea Foundation also financed in 2018 the construction of the 5th Orange village in Kataly. In these villages, which benefit from the construction of a school, a health post and an improved well, students also benefit from a digital kit and the women from a digital house to support their empowerment.

- Entrepreneurship support Orange Guinée’s commitment to Guineans has also been expressed through its interventions in the field of entrepreneurship.

Thus, the Social Entrepreneur Award has rewarded three winners in its national phase and especially allowed the launch of startups engaged in crowdfunding, agriculture or delivery. Better still, the Guinean subsidiary has reaffirmed its willingness to participate in the development of the local digital ecosystem by also taking part in various exhibitions and workshops: the digital week, Saboulinkeds (exchanges between actors on themes such as financial inclusion) organized by the incubator, Saboutech whose operator is a founding member.

- Sustainable development at the top The preservation of the environment, one of the components of its CSR, was expressed by the launch of the Solar Energy Service in its pilot phase in Doko (in Guinée Forestière). The launch addresses both the needs of Guineans in this locality who have no electricity, but also the challenges of sustainable development in its environmental dimension.

56 Sonatel Annual Report 2018

In Guinea Bissau, Development of the Corporate Social Responsibility (CSR) policy

Health and Children remain our priorities through: - the handing over of materials to distressed families for the reconstruction of their homes destroyed by a fire, - endowments to orphanages (SOS Village) during International Children’s Day, - support for Christmas initiatives for underprivileged children.

Orange Bissau has supported several cultural initiatives: - the sponsorship of Orange Férias ao vivo as part of the holiday animation programme for young people and the promotion of culture (competitions of traditional dances, modern dances, songs, etc. - the sponsorship of concerts during the year to help and support young artists, - the sponsorship of Bissau-Guinean artists for the production of their albums and promotion via Nha Son.

1st Sports supporter - Orange is the main supporter for Bissau Guinean football (2-year partnership with the Football Federation), - and accompanies the popular football championship (Bola Na Bantaba): grant from the federations of neighbourhoods in the towns and villages of Guinea Bissau.

In Sierra Leone Civic engagement continues

The Sierra Leonean subsidiary is the leader in Corporate Social Responsibility providing support to structuring activities such as:

- Ebola kids (taking care of children in relation to the Ebola epidemic), - Thinking Pink Breast Cancer Awareness Foundation (fight against cancer), - the construction of an emergency room at Connaught Hospital, - partner of the government «free education» programme, - Emergency Relief Donation to Susan’s Bay Fire Victims.

57

OUR 4 ACTIVITIES 4.1 IN SENEGAL

4.1.1 Mobile: Orange maintains its leadership in the mobile market with over 53% market share

Despite a high penetration rate of the mobile market, Orange has maintained its leadership in the mobile market with more than 53% of market share and a mobile subscriber base of around 8,730 million subscribers.

To facilitate exchanges and support the dynamism of economic activities, Orange launched several strong actions in 2018.

Making mobile Internet more accessible to all

- 4G+ coverage extended to Dakar and the regions 4G+ was launched in July 2018 in Dakar, Diamniadio, Kedougou, Tambacounda, Ziguinchor, Diourbel, Touba, Tivaouane, Kaolack, Thies, St. Louis, Mbour, Saly to provide customers with a much faster internet connection.

All regional capitals are covered by 4G.

60 Sonatel Annual Report 2018

- Continuation of the digital revolution The Sonatel Group pledged to the State to make the Internet accessible to all with the goal of reducing costs by 50% by 2025 while being competitive. Thus, after its Act 1 in 2017, it rolled out its Acts 2 and 3 in 2018 in order to support the digital emergence of Senegal through, in particular for all its customers (fixed, mobile, companies): - The repositioning of the range of Pass Internet and Fixed Internet: drop in tariffs, large volume, possibility of postponement of some Passes, bonus. - Anticipated tariff redesign broadband fixed for an Internet Everywhere for all: lower royalties, preferential rates.

- The repositioning of the range of Internet Pass: lower rates and large volume Reaffirming its commitment, the Sonatel Group has lowered the price of mobile Internet since January 16, 2018 with the increase in the volume of daily and weekly Passes, the reduction of some Passes, the introduction of volume transfer, access for Orange S’cool and Kirène Orange customers to all Orange Passes in addition to their dedicated Passes.

- The digital revolution of fixed Internet Act 2 was also an opportunity to effect an average 12% drop in Internet rates at home, an increase in throughput and the introduction of volume reporting on KeurguiBox’s 12GB, 30GB and 50GB Passes.

Nouvelle baisse des prix sur les forfaits et Pass KeurguiBox.

61 4.1.2 The Orange Money saga continued successfully in 2018

Mobile banking remains at the heart of the mond Bank), Atlantic Bank and GSIE with Group’s strategy. Orange Money, led by micro-finance institutes. Orange Finances Mobile Senegal, conti- nued to grow and diversify its services. - The CSR impact of Orange Money reinforced - Invoice payment available in the distri- Thanks to Orange Money, the Sonatel bution network Group is anchoring its commitment in the Non-registered Orange Money customers education sector by providing candidates now have the option of paying their bills to the Customs entrance exam the at the point-of-sale network, including possibility of paying the registration fee, kiosks. but also allowing university students to pay their registration fees with CAMPUSEN. - Salary payment With Orange Money, it is now possible for In the health sector, the use of Orange employees to receive a portion of their sa- Money contributes to the fight against lary on their Kalpé and benefit more widely breast cancer with the opening of the from the services offered by Kalpé. donation channel for LISCA.

- International transfer with RIA The impact of Orange Money also extends Thanks to RIA’s broad network, customers to the preservation of the environment, can now receive a free international especially with Proplast, a plastic waste transfer on their Kalpé Orange Money. collection company. Customers benefit from UV in exchange for collected plastic - Strengthening partnerships on Bank waste. to Wallet Banking service is enriched with new partnerships: UBA, NSIA Bank (ex Dia-

62 Sonatel Annual Report 2018

4.1.3 Business Services: to support the digital transformation of professionals

Orange Business Services is the Sonatel Group brand that markets solutions for companies, small and medium-sized businesses and pros.

Our ambition is to be a growth accelerator for all organizations with the main objective of supporting the digital transformation of companies.

To that end, a team of more than 300 experts is mobilized daily to support these customers in the implementation of their projects and in the development of their activities, whatever their size and sector of activity.

We have an answer for all the basic needs of the company, from the human scale to the multinational, to communicate, to connect, but also to respond to the business issues of each of them.

Customer Service Transformation to Better Support Business Requests

The ongoing customer service transformation plan resulted in the creation of a unique business information, order and claim number for corporate customers, 800 800 800, as well as a unique email address. [email protected]; Orange Business Services has also set up a WeCare address for Gold customers with dedicated agents.

Further, support agents can now travel to Key Account Customers to assist them in configuring their mobile devices.

Inventing a new way of working together

After listening to its customers, Orange Business Services has written a new page in the history of mobile business offers. Orange Business Services now offers a prepaid, non- binding mobile service for professionals. With Jamono Pro, the customer has volume on his calls and the internet and can focus on developing his business. Companies also benefit from the new Teranga line which is more generous but also more complete and innovative. It meets the mobility needs of Pro, Small Business and Key Accounts customers regardless of their size and field of activity.

Very high speed to boost their business

With Fiber, the Sonatel Group offers very high speed solutions to companies wishing to benefit from a smooth, stable and secure internet connection of up to 200 mbits and sufficient comfort for large file sharing, backup of data, videoconferencing, access to cloud applications...

Professionals will be able to improve their performance thanks to fiber.

63 Improving the Customer Experience offered by our customers

With the My Business Wifi offer, corporate customers can offer a better experience to their visitors and reinvent their customer relationship. Indeed, My Business Wifi is a turnkey solution that offers Wifi Internet access to businesses for their customers, employees and visitors.

We are also an Integrator

Through our subsidiary Sonatel Business Solutions, we offer companies solutions for integration, unified communications, security, connection and networking, IT, consulting.

We support Senegalese companies, based on their needs, from brainstorming to implementation, advice to development of new and customized services.

Rufisque Datacenter TCDD Certification (Tier III Certification Design and Documents)

The Sonatel Group is the leading operator in the cloud and storage solutions in Senegal. This is possible thanks to its new latest-generation Datacenter, the largest in West Africa, and international standard offers.

In 2018, we obtained Design Tier III certification for this Datacenter located in Rufisque and a capacity of 750 kilo watts.

This TCDD Certification (Tier III Certification of Design Documents) was issued by Uptime Institute, a consortium of companies created in 1993, which is the only organization authorized to issue Datacenter certifications since 2015.

Uptime Institute is also known in particular for defining the «Tier» concept for Datacenters (Tier 1, 2, 3 and 4) widely adopted in the world and whose objective is to maximize efficiency.

This certification consists in validating the Tiering level of a Datacenter on the basis of its conception in terms of Design and on the quality and conformity of its technical documentation (plans, diagrams, data sheets, calculation notes, power reports, functional analyzes, etc.).

With this certification, Sonatel has joined an exclusive group of industry leaders. This business certificate is added to ISO 50001 already obtained.

From 2019, we will move forward to conquer the Uptime TCCF Certification (Tier III Certification of Constructed Facility).

Signing of partnerships to support professionals

To support and facilitate professionals to equip themselves with telecommunications solutions, Andando agreements have been signed with various groups active in the country, such as the Trade Union of Pharmacists and consultations initiated with others such as the Bar Association.

64 Sonatel Annual Report 2018

4.1.4 Content: development and innovation

In 2018, the Sonatel Group, through its subsidiary Sonatel Multimédia, strengthened its position in the field of content and digital. We continued the catalog enrichment dynamic and strengthened our production and content acquisition capabilities through the creation of a Content Factory department. The year closed in style with the 3rd Dakar Digital Show, held from 4th to 6th December at the King Fahd Palace.

The 3rd edition of the Dakar Digital Show now places the Senegalese capital at the heart of innovation and the digital economy

Organized under the central theme: «Successful digital transformation», the first International Exhibition on Digital and Content in West Africa consolidated the achievements of the first two editions by being the special meeting point of the world of digital production of Africa and the world.

The aim of the Dakar Digital Show is to develop a real platform for B2B meetings by providing Embarquez pour la industry professionals with a platform for ex- révolution numérique changes to highlight business prospects and, on the other hand, to bring together stakeholders of the contents and digital sector of Africa and the world. Dakar Digital Thus, the themes of this year were chosen ac- Show#3 cording to the latest trends in digital transforma- tion: Artificial Intelligence, IoT, Fintechs, E-Health, E-Education, M-Agri, Art and Digital, Financing and Fundraising for Start-ups, Virtual Reality, etc.

This 3rd Dakar Digital Show was marked by the organization of the International E-Sport Tourna- ment: Orange E-Sport Experience. This internatio- 5 et 6 décembre 2018 nal competition witnessed the participation of the au King Fahd Palace continent’s best E-sports players and was graced by the presence of Street Fighter World Cham- www.dakardigitalshow.com pion, Kayane.

Product and service launches

Nutrifit and Coaching servicies in personal development came to enrich the smart services portal catalog by offering more diversity to #111# subscribers.

The launching Addina and Sunshine albums also, in terms of content, helped the production of the albums of the pitches selected during the previous DDS.

« Hello star », a voice service enabling access to news about your favorite stars, crowned the launches in 2018 by featuring artists such as Elzo, Canabasse, Maabo and Sidiki Diabaté.

65 Launch of Orange Energie

Diversification towards the energy sector began for the Sonatel Group with the launch of the Orange Energy Pilot in the regions of Mbour and Fatick. Orange Energie is an offer of Solar Home System (SHS) solar kits for homes and small businesses in rural areas. In addition to the battery and the solar panel, the kits come with accessories (lamps, phone charger, television...) providing electricity for less than 170F per day for the basic kit and 450F per day for the TV Kit. This offer was a great success with nearly 800 households equipped in 2018.

4.1.5 Diversification to new areas

The year 2018 also marks the implementation of various Sonatel Group Diversification programmes. Indeed, in the face of a profoundly changing environment and to meet the challenges of revenue growth, it has become necessary for Sonatel to diversify into new areas.

Lèral sama kër, nàtal sama dundine Orange Énergie Frais d’accès : 10 000 Fcfa

Kit Éclairage 5 000 Fcfa par mois sur 36 mois 1 panneau 3 ampoules 1 chargeur 1 batterie solaire LED téléphone

Pour plus d’infos, rendez-vous dans votre agence ou appelez le 800 55 00 55 (appel gratuit)

66 Sonatel Annual Report 2018

4.1.6 Continued transformation of the commercial service: digital and human 2018 is marked by continuing sales transformation

The main actions of the Sales Department of Sonatel in 2018 are:

The reinforcement of the digital equipment in branches

After the opening of the first smartstore in 2017 and the generalization of digital equipment as well as the RQM tool in all branches, light kiosks were deployed at the cash register level in 2018 to complete the system.

Improving customer experience in branches

Continuing our efforts to make our customers’ experience in our branches a pleasant one, since October we offer them free access to wifi in all branches

Continued development of the trade channel with an increase in the number of salespeople

With the establishment in 2017 of the new structure in charge of animation and field sales, the Sonatel Group contributes significantly to the (indirect) creation of jobs. It should be recalled that it is the Sonatel Group that finances the acquisition of business registers (RCCM) and NINEA for these young sellers, thus contributing to sustainable economic development.

Strengthening the distribution of professional customers

2018 was marked by the setting up of PRO indirect distribution with a first pilot phase in Dakar and Thiès. The Sonatel Group uses its network of partners to distribute its products to business customers.

Strengthening our partnership with our wholesalers on the indirect network

For our indirect partners, a support plan has been put in place to help better organize their activity.

Also, new management tools have been deployed for a more detailed analysis of the market and an immediate response to customer expectations.

67 4.1.7 Delivering an incomparable experience to our customers in order to make them prefer Orange

At the end of 2013, the Sonatel Group launched its Transformation Project on the Customer Service perimeter, with a 4-year Master Plan.

Significant results have already been achieved so far, as evidenced by the quantitative and qualitative performance, and each year brings us inexorably closer to our stated ambition.

COPC standard Certification

This certification has been obtained for three consecutive years (2016, 2017 and 2018), based on a high-performance international benchmark specific to the customer service business.

The 2018 certification included telephone technical assistance and the digital platform. The complexity of the 2018 certification also resided in the extension of the scope of performance to the multichannel customer experience and unassisted channels.

COPC Plus

The strict and daily application of the major requirements of the COPC standard is a guarantee of quality, customer satisfaction, profitability and lower costs.

The fundamentals of the approach are now mastered on consumer customer service activities, and 2018 served to consolidate the performance of agents and managers.

Generalized COPC

A strategy to generalize the COPC approach to all points of contact with customers has been designed ultimately to positively impact the customer experience over an extended scope.

To this end, a system for pooling human resources and IT customer service has been set up and launched.

68 Sonatel Annual Report 2018

Accelerating the digital transformation of customer service

The digital platform, launched in June 2016 with the stated ambition of doubly impacting customer experience and control subcontracting costs, continued in 2018 to produce outstanding performance in terms of accessibility, availability, reliability, response speed, as well as efficiency and quality of attention.

In view of these results and after a first communication campaign in 2017, an ambitious communication programme was designed and launched to improve the visibility of digital channels in the customer service area.

A stream gathering several projects in the digital field has also been integrated to accelerate the digitization of contact channels and business processes.

Other structuring actions in our effort to reinvent the customer relationship were carried out in 2018:

- Merging commercial assistance and technical assistance in Fixed line, Internet and TV To improve customer experience in this environment, business and technical support activities have been merged, with a single point of contact, which has greatly simplified the customer journey.

- Consolidation of the dysfunction prevention approach The process, started in 2013 and now industrialized, was intensified in 2018 and several critical problems addressed effectively by the professions.

4.2 …AND IN THE SUBSIDIARIES 4.2.1 Orange Mali

Orange Mali: Annual growth achieved

In 2018, despite a difficult economic and security context, Orange Mali achieved a year of growth.

With the launch of 100% Orange fiber and 4G+, Orange Mali is the 1st operator to offer its customers incomparable connectivity at very high speed.

As a corporate citizen, Orange Mali wants to be the 1st partner of the digital transformation everywhere in Mali. This is why Orange Mali has pledged to the authorities to achieve ambitious coverage targets in order to contribute to the country’s digital growth.

Orange Money remains a real success with 4.2 million customers and more than 29,000 distribution points throughout Mali.

On the Malian territory, the distribution network has developed in a regular and structured manner to ensure the availability of refill cards everywhere and at all times. The business market has seized new opportunities by developing bandwidth for highly innovative internet solutions.

69 An ambitious enterprise at the heart of Mali’s economic development

In addition to renewing its 2/3G license and obtaining that of 4G, significant investments were made in 2018, bringing cumulative investments to more than five hundred and forty-eight (548) billion CFAF since the establishment of Orange Mali, and to 1,685 the total number of radio sites built to date.

The market development following these investments has enabled Orange Mali to achieve the following results: - more than 98% coverage rate; - 17,965 localities covered in Mali; - 1,685 radio sites built to date; - 3202 km of fiber optic deployed in total, including 37.70 km in 2018 to provide greater connectivity in Mali; - deployment of 4G in the capital Bamako; - access in Mali extended to the ACE submarine cable of which the Sonatel Group is co-owner: 3 outlets for Mali’s access to the submarine cable - 1 outlet to Côte d’Ivoire and two to Senegal (Kidira and Moussala)

Orange Mali, digital and human employer

At Orange Mali, the launch of the pledge to be a digital and human employer has resulted in a vast awareness campaign and a strong involvement of the staff in the implementation of innovative projects supporting this commitment. The ambition is to offer each employee a unique experience at each stage of his professional life and in all key moments of everyday life.

In 2018, we stayed the course by consoliding our achievements and went further with the enrichment of our catalog of services (in terms of activity, initiatives and tools).

The development of skills through training, the professionalization of employees, investments in safety and medical coverage for employees and their families are the foundation of Orange Mali, a digital and human employer.

Innovative products and services for 13 million customers, individuals or companies:

- Prepaid and postpaid offers for voice and «mobile data»; - Internet offers for everyone, for both home and business: in August 2018, Orange Mali launched 4G technology, offering its customers high speed broadband connectivity; - a catalog of innovative offers and services with all integration solutions dedicated to professionals and businesses, SMEs, NGOs and institutional structures.

Mobile: over 4% increase in Voice turnover and 135% increase in Data turnover

Orange Mali provides the population with products and services adapted to all their telecommunications needs. 98% of the population is covered with the Orange Mali network.

70 Sonatel Annual Report 2018

An Internet solution adapted for each Malian customer

- 4G and 4G+: access via smartphones and tablets, 4G thumbdrives, Wimo (portable WIFI for all); - So ‘Box 4g and So’ Box’s intense last-generation Fly Box enables Malian families to benefit from an ultra fast internet at home, to surf at competitive rates thanks to the redesign of mobile Internet; - Radio links: speeds up to several Mbits possible everywhere in Mali; - Fiber optic: access to more than 100 Mbps for businesses.

Terminals: more than 4,500,000 smartphones connected on our network in 2018

Orange Mali has a wide range of smartphones and tablets: IPhone 6s, IPhone 6s plus, IPhone 7, IPhone X Samsung Galaxy, Tecno, Tablets, Pixi 2 Max, Idol mini, Idol Alpha, YUV smart, Pop7, Pixi 7 ...

Business solutions: innovative products

- Integration of Services: end-to-end turnkey solutions (engineering, links, equipment, benefits ...); - international site interconnection offer (RAFIA); - Business telephony offer with Micro PBX functionality (Business Orange Box); - Machine 2 Machine offer: geolocation, and security offer; - offer of information and alerts by SMS (Web SMS).

4.2.2 Orange Guinea, a sustained leadership

Major events of the environment

2018 was marked by socio-political instability: challenges of the results of the municipal elections and the organization of demonstrations and numerous ‘’dead city days’’, change of government in May 2018 and dismissal of the President of the Constitutional Court, social tensions marked by recurrent strikes against rising fuel prices and paralysis of the education system.

Despite this difficult environment, growth has been maintained and value preservation actions have been expanded.

Negotiations continued throughout the year on increasing the spectrum and the acquisition of the 4G license.

Finally, note the reduction in the number of telecommunications operators at the end of the year with the shutdown of Intercel activities by the regulator in mid-October.

71 Mobile: preserving value

At the end of December 2018, Orange Guinée recorded a market share of 64% and a market share value of 68%.

The sustained expansion and network densification as well as the launch of segmented offers accompanied by major commercial events enabled it to a gain 7% growth of its subscriber base.

On mobile money, the share of e-recharge via Orange Money has greatly increased and the commission rate has decreased by -5.5pts.

Mobile Internet: Growing use rate

With a growth rate of 22% on broadband, a smartphone penetration rate of 32.9%, Orange Guinea recorded at the end of December 2018, a data subscriber base of 2,394K.

The use of data is growing steadily, although limited by the frequency spectrum deficit and the lack of backbone availability in the regions: +52% vs 2017.

Innovative products and services

2018 also marks the launch of segmented offers: the Choco range and the Swag club.

Launchings accompanied by exclusive animations, large-scale field events in Conakry and in regional cities (festivals in the regions, Festilive in Conakry) or events bringing together authorities and stakeholders as was the case in Doko at the launch of the Solar Energy Service. Its partnerships with the Guinean Football Federation and, new, with the Guinean Basketball Federation, have allowed it, beyond football, to embark on a new territory conducive to animating and retaining customers throughout the year.

72 Sonatel Annual Report 2018

Orange Money

The first months of 2018 marked the leadership of Orange Money: two million customers! The multiplication of partnerships with the banks, with some administrative departments - the payment of the water bill of the SEG, the purchase of tax disks, the extension of TV resubscription services with Startimes, the opening of money transfers from France and the proliferation of businesses offering merchant payment, have ensured a good growth: + 117% vs 2017.

The reinforcement of the distribution network (deployment of kiosks throughout the country) and the continuous animation of the commercial offers have given Orange Money a boost that is both constant and sustained.

Investments: the best of technology for densification and network expansion

The network densification and expansion of 2G/3G coverage continued: 200 new sites were commissioned, increasing the Orange Guinea network to 1,515 sites, including 1008 2G/3G sites.

Investments have been stepped up on the energy side of data centers and upgrades have been made on service platforms, especially on the core network (IN migration). The allocation of a new PQ (629) to the operator has helped to support its growth.

The promise of delivering an unparalleled customer experience and the highest quality of voice and data technical service (QoS) has resulted in continued negotiations for the acquisition of a 3rd carrier, that of the 4G license and the deployment of several action plans:

- densification of high traffic areas and large cities, - the activation of new radio parameters, - the upgrade of backbone links, - the deployment of indoor solutions to improve QOS DATA in VIP areas, - the installation of an RNC in Boké to decongest the Backbone, - optimization of cells at the busy time in highly congested areas.

73 4.2.3 Orange Bissau, leading operator in Guinea Bissau

Highlights

The economic situation was not favorable in 2018 with the decline in the value of the telecommunications market. In the regulatory field, the situation is still difficult with the VAT hike and the plan to control inbound traffic.

Despite this environment, Orange Bissau was able to generate value with a market share value of 58%, up 3 points, and a leadership volume of 56% thanks to the continued development and modernization of its network and commercial actions. This contributed to a 12% growth in the Company’s net income.

Mobile Network Modernization and Network Development

2018 was marked by the modernization of the entire network in Nokia. The development of the mobile data network has remained a priority to ensure the rapid growth of usage with: - the ACE cable landing project planned for the end of 2019, - the extension of coverage in 3G and 4G Bissau city and in the regions, - the increase in data bandwidth capacity and securing the access network while waiting for the ACE (submarine cable) project to support the rapid growth of data usages.

Further, a programme to modernize and secure the core network began in 2018, including the installation of a local USSD redundancy platform and the MSC extension to improve the quality perceived by our customers.

To maintain the development of the Enterprise market, 2018 was characterized on the fixed Internet part by the effective commissioning of the optical ring with the start of the switchover of B2B customers on ultra high-speed fiber optic offerings.

Mobile

The active subscriber base of Orange Bissau in 2018 grew by 6% compared to 2017.

The operator remains the market leader with a market share volume of 56.2% and a market share value of 57.8%, up 3 points from 2017.

Internet

At December 31, 2018, the active mobile data subscriber base grew by 45% compared to 2017.

Orange Bissau was the first operator to launch 3G (2015) and 4G (2016) in Guinea Bissau. The whole capital, Bissau, is covered by 3G and 4G networks, and the regional capitals have been covered also by 4G. More than 90% of the active Orange Bissau base is now covered by 3G.

74 Sonatel Annual Report 2018

The development of Data Mobile continues: - several innovations have also been launched on mobile data, including the new transfer service of Manda Mega Internet Pass in May, and the extension of loans for the Djudan Na Service Internet - promotions on smartphones and new terminals; - as well as important field animations, especially during the Digital Tabanca on the first half-year, the Kaba kau operation in August and the 72-hour Chrono in December.

Orange Money

Launched on 6 January, 2017, the Orange Money service continues to grow and now has 22 200 active customers at 31 December, 2018, compared to 5,156 customers at 31 December, 2017.

In order to develop the service, several actions were carried out during the year 2018: - the launch of new corridors (Mali, Niger, Burkina), - the launch of the merchant payment, - the launch of the Orange Money app, - the launch of the kiosk network, - the realization of the first Orange Money Bissau Audit by BCEAO, - field animation activities in Bissau and in the main regions of the country.

Innovative products and animations

2018 was marked by the strengthening of the ecosystem around Orange Money, the improvement and enrichment of existing products and services, as well as the extension of coverage of mobile data in Bissau and in the regions.

Numerous events have enabled Orange products and services to be highlighted throughout the year: - Operation Digital Tambanca: caravan sales and configurations of smartphones - May and June in Bissau and regions; - «Orange kaba kau» Sale Campaign in Bissau and the 3 main regions of the country (July-August); - OFAV: Orange organizer of cultural and educational activities during holidays in Bissau and regions from July-August; - Bola Na Bantaba: Orange sponsor of the inter-neighbourhood holiday championship: June to October; - 72h with Orange in December; - Field Transfer Actions in November and December.

75 4.2.4 Orange Sierra Leone, one year after rebranding: UNA KUSHE !

With over 330 sites covering nearly 70% of the population of Sierra Leon, 2018 was by far the year of development of the Orange network punctuated by a reconquered leadership in coverage and quality through the extension and modernization of the network.

Orange gained more than 6 points of market share in 2018 thanks to local actions, a portfolio of products and services based on abundant and innovative offers and a large- scale commercial deployment. The Business Project «SUNRISE 2021» was successfully launched mobilizing all staff around the 5 priorities of the General Management:

1. To be the voice and Internet leader in the market, with half of the Orange base using the Internet. 2. To achieve 90% employee satisfaction. 3. To develop existing growth drivers such as Orange Money and B2B, and create new business opportunities/innovations (Energy, Education, Agriculture). 4. To make the business more profitable and efficient: agility and fight against waste. 5. To have an incomparable customer experience and give back to Sierra Leone.

We are proud to mention that Orange Sierra Leone is: 1. the first investor in Sierra Leone after the Ebola crisis, 2. the first operator in coverage and voice and data network quality, 3. the leading NPS operator in Sierra Leone, 4. the leading operator of mobile payment with Orange Money, 5. the leading operator in Corporate Social Responsibility.

76 Sonatel Annual Report 2018

A definite contribution to Sierra Leone’s economy

- Investments in the modernization and extension of the network

After a phase of network modernization in 2017, Orange Sierra Leone accelerated its expansion programme in 2018 with the opening of new strategic sites, the rollout of 3G and preparation for 4G. The investment programme, amounting to more than 23 million dollars (approximately 14 billion CFAF), has made significant progress in 2018:

- modernization of the 2G & 3G access network; - modernization of the collection and transport ; - 35 new sites, including 13 with 3G, commissioned in 2018; - preparation for the commercial opening of 4G in 2019 ; - upgrade of several service platforms.

- Investment in human resources development

Orange Sierra Leone, at the end of 2018, had 182 permanent employees with 18 recruited in the year. The company has also continued to improve the situation of agents on temporary contracts in order to provide them with better social security coverage through a temporary employment agency.

The human resources activity was very dynamic in 2019 with:

- A rich programme of training, each employee has benefited from a minimum of training during this year. - Continuous improvement of conditions of hygiene and safety: no major accidents, development of sports activities, improvement of the quality of the canteen. - The rewarding of the best performing employees. - The launch of the company project «SUNRISE 2021» co-built with all the staff. - The availability of insurance against accidents at work also including partners operating in the kiosks and tricycles of the distribution network. - The continuation of the communication campaign to change the perception of customers. - The continuation of staff mobility within the Company.

Solutions for nearly 2 million individual or business customers

- Billing per second for «on net» calls for all prepaid customers. - The redesign of internet bundles leading to a 35% decrease in the customer price and the introduction of a range of bundles corresponding to all budgets and all needs for Internet use. - The confirmed success of unlimited voice bundle for all our prepaid customers. - The launch of «YO», the young offer, around low-cost bundles. - The launch of a full range of (4G ready) smartphones. - The launch of abundance products (night data offers, night voice offers...). - The launch of a franchised network in Freetown to develop our distribution network. - The launch of international corridors (USA, UK, France ...). - Digital solutions available to customers (Facebook, My Orange, Instagram, Twitter, new website).

77 Orange Money confirms its position as market leader

All indicators show an acceleration of Orange Money’s performance and confirm the strong market potential in Sierra Leone. Compared with 2017, Orange Sierra Leone’s performance was as follows:

- income +47%, - active customer base: +76%, with nearly 375,000 customers late 2018, - number of transactions +35%, - number of points of sale: +12% - active points of sale: +75%, nearly 5,000 at the end of 2018.

2019 outlook

For the year 2019, Orange Sierra Leone’s priorities will be: To continue to improve network QoS and deploy coverage.

To accelerate revenue growth: - launching mobile 4G and fixed with many covered sites in Freetown and province, - continuing the launch of abundance voice and data offers, - continuing the dynamics of B2B and launching new business,

To constantly improve customer experience and be a leader in customer satisfaction.

To roll out the Business project.

To deploy new sites (55 are planned in 2019).

To be a leader with 47% of market share and 50% of market share.

To have a staff satisfaction rate of over 85%.

78

NETWORKS AND INFORMATION TECHONOLOGIES MODERNIZATION OF THE MOBILE 5.1 NETWORK

The Sonatel Group, anxious to have a mobile continued major upgrades and expansion of its network always at the forefront of technology, mobile network.

Deployment of latest generation equipment supporting 2G/3G/4G

The new equipment deployed has reduced energy consumption and contributes to Sonatel’s environmental policy. The project started in 2017 with 469 sites, and was finalized in 2018 with a programme of 477 sites including Louga, Petite Côte, Fatick, Diourbel and religious areas (Touba, Darou Mousty and Popenguine).

Further modernization of the Datamobile core network and service platforms

Datamobile Network core to support traffic growth: - Extension of the capacity of interfaces and transport links to 100Gbps.

Core Circuit Switched (CS) and Service Platforms: - Extension of processing capabilities on the IN (Intelligent Network) platform and Value- Added Services platforms (such as the USSD) to support the evolution of traffic and marketing needs, deployment of a new MVAS platform as part of the modernization of the network. - Finalization of the old MSC/MGW swap with higher capacity equipment and migration to a new SDM/NgHLR with greater capacity and resilience.

82 Sonatel Annual Report 2018

FURTHER DEPLOYMENT OF 4G/4G+ 5.2 IN SENEGAL

4G is present in 484 sites in Dakar and 576 in the - simultaneously access several Internet services regions. without any loss of quality, for example: watching a video while browsing the Internet; In 2018, we note the introduction of 4G+ on 269 - explore new uses such as mobile cloud sites in the capital and in the regions. computing that offers the opportunity to work while on the move, as if you were in the office; The extension of the 4G/4G+ coverage will be Cloud gaming that allows you to play HD console continued in 2019. games from your mobile or tablet anywhere and on any device; HD video from mobile to mobile, Delivering up to ten (10) times higher throughput for example, videoconferencing from a mobile on uplink and downlink links over 3G+ and greater phone, with excellent image and sound quality, flexibility in traffic capacity, 4G is revolutionizing and the added bonus of viewing documents the mobile broadband customer experience. directly on mobile screens.

Orange customers who access this 4th generation Moreover, all mobile data offers from Orange network will be able to: are already 4G/4G+ compatible and can be - benefit from the essential functions of today, used by customers who meet the prerequisites: combining quality and speed: consulting a Mobile TV, Mobile Internet (browsing, streaming), website, listening to online radio, watching a Mobile E-mail, Business Everywhere, Internet video, downloading a file or application, etc.; Everywhere, etc.

LAUNCH OF HOME FIBER OPTIC 5.3 PROJECT (FTTH)

In 2018, the home Fiber Optic project continued in the areas of Medina, Point E, Fann, Almadies, Mermoz, Sicap Sacré-Cœur, Hann Maristes, Sud Foire, Ouest and Nord Foire, Almadies, Ngor, Yoff and Touba. And this after a launch in 2017 in the areas of Keur Gorgui and Plateau.

At the end of December, the total number of equivalent connectable homes increased significantly.

83 MODERNIZATION OF THE FIXED 5.4 NETWORK

Sonatel has a new IMS (IP Multimedia Subsystem) This new solution has enabled the switching of solution to modernize its fixed network in order the Mbacké central subscribers, the first phase to: of this fixed-line subscriber migration on this new - solve the problem of obsolescence of fixed technology. The IMS has also allowed certain exchanges; customers to connect to the FTTH and provide - migrate to Full IP with the emulation of PSTN them with voice services. residential and Business Trunking services; - enable marketing to generalize dual play or A new CTI-IP has been set up to meet the triple play offers by establishing the Livebox expectations of the partner operators with IP as the basic terminal of fixed telephony; - set interconnection. up new services: multimedia teleconferencing (audio, video, data), IP Centrex.

FIBER OPTIC DEPLOYMENT FOR 5.5 3G/4G COLLECTION

Sonatel has finalized in 2018 the fiber optic Thus, at the end of December 2018, the total service of all mobile sites in urban areas (regional number of sites collected in FO is 1186. capitals, département headquarters and some large communities) with 150 new sites collected in fiber optics including 54 sites in Dakar and 96 in the regions.

FURTHER INVESTMENT IN RURAL 5.6 AREAS

Sonatel is pursuing its investment policy in the - Start of work for laying an underwater cable rural areas with a programme of 106 new sites in between Saint Louis Continent and Saint Louis 2018 and is planning an additional 71 in 2019 to Island improve the coverage of localities of more than - Extension of the DWDM backbone and 500 inhabitants and priority roads. commissioning of 100G wavelengths in the regions.

84

6 SONATEL IN THE INTERNATIONAL AND WHOLESALE MARKET As the main hub of West Africa, the Sonatel Group is very active in the sub-regional dynamics for the definition and implementation of common strategies (roaming, regulation, etc.). It notably participated in the revitalization of the wholesale cluster committee and various mutualization projects (core data network, marketing offers, etc.), as well as major international meetings organized by the International Telecommunication Union (ITU) and aimed at working on the issues of the sector.

SOME STRUCTURING PROJECTS 6.1 HAVE ALSO BEEN ROLLED OUT:

- such as the technical support for the Roaming Various migration and improvement work has test for the 2018 World Cup Promo project, been conducted for CSM and satellite connectivity pilgrimages to Mecca and Rome; as well as securing internet bandwidth. - the signing of the contract for the project of the 3rd HD (MainONE) cable during the second half In 2018, we can also note the extension of the of 2018; Roaming network through 184 openings made - continuation of work in segment 4 Sao Tome - and the launch of the IN roaming test campaign South Africa; on the In Cloud site. - increasing the capacity of the SAT3 (Upgrade 6).

A VERY EFFECTIVE COMMERCIAL 6.2 DATA COUNCIL

Corridors In addition to the African corridors, agreements The corridors have helped maintain retail traffic have been concluded and strengthened to on secure routes. capture traffic originated in France, Spain, Italy, USA, Canada. The associated tariff cuts have enabled this offer to be taken up well, allowing operators to lower Ongoing IP interconnections will reinforce this the retail price, increase their domestic market strategic shift to source traffic to secure inbound shares while enhancing customer loyalty. international.

88 Sonatel Annual Report 2018

PARTICIPATION IN ACE (SUBMARINE 6.3 CABLE) SUB-COMMITTEE MEETINGS

In December 2017, the Sonatel Group was unanimously elected Vice-Chairman of the ACE Submarine Regulation and Communi- cation Sub-Committee.

In January 2018, its responsibilities were reinforced through its interim chairmanship of this subcommittee.

Various projects have been undertaken in- cluding regulatory coverage, targeting of research activities for new partners and in- vestors.

The Sonatel Group took part in the various structuring meetings: regulation and com- munication, investments and agreements, management commitee, SAWAS, WAS, Afri- com, etc. Topics such as the fight against fraud, submarine cable projects and band- width optimization were addressed.

These exchanges made it possible to sign IOT discount agreements, finalize commercial roaming openings and remove the possible technical obstacles.

Thanks to the doubling of the Internet bandwidth, which has doubled in less than a year, from 80 Gbits to 172 Gbits, quality capabilities and services are now available and secure.

These large-scale operations are complemented by the Sonatel Group’s expertise, which was again demonstrated by the Development of Engineering Consulting on the African continent.

89 INNOVATIVE OFFERS WITH MARKE- 6.4 TING OPERATORS

Launch of unbundling in Senegal in July 2018 This pop will enable Interco Pop to Pop launching In 2018, Sonatel extended the national wholesale from Paris, to the rest of the world through offering catalog with the Unbundling project, partnerships. which allows the opening of the local loop network to third-party operators and ISPs allowing them Development of infrastructure-sharing offers to make copper offers. In April 2018, an initial experience of sharing active antenna equipment was carried out with 1st POP Sonatel abroad (Telehouse Paris) Expresso, at the AIBD airport to improve the Sonatel, to meet the needs of national, Indoor 2G/3G coverage of the new airport. international, ISP and Business operators has implemented international Ethernet solutions, through the extension of the Sonatel Backbone in Paris.

6.5 VOICE AND ROAMING

Free roaming The second evaluation meeting on the implementation of the Abidjan Protocol was held in Lomé in the presence of the regulators of the signatory countries of the Free Roaming MOU. The regulators took stock of progress in different signatory countries and formulated recommendations.

Thus, the operators took advantage of this evaluation meeting to discuss the loss of earnings caused by free roaming.

Corridors In 2018, Sonatel continued its bid on two-way corridors (both incoming and outgoing) with Orange Mali, Orange Côte d’Ivoire, Orange Niger, Orange Bissau and Orange Guineé.

Sonatel has also launched new corridors in Africa and Europe (Canada, USA, France and Italy) to combat Symbox fraud and OTT. These targeted countries have a high rate of Senegalese and the corridors have also allowed us to secure the incoming volumes and consequently the turnover: -16% decline in corridor zone against -55% off corridors at the end of the month of December 2018.

90 Sonatel Annual Report 2018

SONATEL CLOSE TO THE PILGRIMS 6.6 BRINGING THEM COMFORT IN ROME AND MECCA

Rome Pilgrimage These actions helped generate an unprecedented For several years, Sonatel has accompanied turnover and genuine pilgrim satisfaction with the Catholic and Muslim pilgrims to their respective arrangements put in place. holy places. For the 2018 edition, a grant was awarded to the national organizing committees and agreements signed with the partner operators allowed, once again this year, to set up preferential rate offers during the various journeys thanks to the Orange travel packages.

Technical measures were also taken to ensure the availability of service throughout the pilgrimage.

And to be even closer to the pilgrims, our teams were present at the airport at their departure to give them the necessary support on the setting up and changing of their 4G Sim card.

Mecca Pilgrimage The 9th edition of the Mecca offer made it possible to generate a unprecedented turnover and the pilgrims were very satisfied with the arrangements put in place: partnership with the upstream tour operators, implementation of a roaming price drop including advantageous packages.

In 2017, the success of the project led to the duplication of this experience by all our subsidiaries, thus consolidating the power of our brand, but also generating additional revenue.

Thanks to this synergy, we were able to negotiate more attractive rates with the operators in Saudi Arabia, which allowed us to offer our pilgrims an 80% reduction compared to the list prices, for example on the calls from Mecca to Senegal, and -50% on data compared to last year and, for the first time, make them enjoy 4G.

The introduction of Pass Makkah was welcome by all our pilgrims, especially the 9900XOF Voice and SMS Pass (100mn, 100 sms, 15mn of reception) as well as the 1giga Pass data, which benefited from a 50% price drop compared to last year.

91 SONATEL’S CONTRIBUTION TO THE 6.7 SUCCESS OF MAJOR INTERNATIO- NAL EVENTS

Sea Me We 3 This meeting was the 35th meeting of the Board of Dakar hosted from November 27 to 30, 2018 at Directors and made decisions on subcommittee the Radisson Blu, for the first time, the SEA ME recommendations, strengthening cooperation WE 3 Cable System Management Committee, a between the different consortium members and consortium of which Sonatel is a member. opening new perspectives on Senegal.

92

KEY FIGURES AND SONATEL IN THE STOCK 7 EXCHANG SONATEL : Integrated telecom operator

SONATEL 2018 SHAREHOLDING 23% Floating

27% 42% State of Orange SA 8% Senegal Sonatel employees

Percentage Country Companies Holding held Sonatel SA Parent Comp Direct Sonatel Mobiles 100% Direct Sonatel Multimedia 100% Direct Senegal Sonatel Business Solutions Direct 100% Orange Mobile Finance Senegal Direct 100%

Orange Mali Direct 70% Mali Orange Finances Mobiles Mali Indirect 70%

Orange Guinea Direct 89% Guinea Orange Finances Mobiles Guinea Indirect 89%

Bissau Orange Bissau Direct 90%

Orange Sierra Leone Direct 50% Sierra Leone Orange Money SL Limited Indirect 50%

Orange Servivces Group Indirect 47% Entry in 2018

96 Sonatel Annual Report 2018

Market and Competition

Senegal Position : Leader Networks 2G - 3G - 4G - 4G+ Market share

-1.4 pts Inflation 0,5%

- Continued turnover growth throughout 2018 thanks to the increased contribution of Data Mobile and Orange Money (national transfer leadership). - Reinforcement of investments in growing activities. - Broadening the competitive field with Mobile Finance and ISPs (Internet Service Providers). Mali Position : Leader Market share Networks 2G - 3G - 4G

56% -4,5-4.5 pts

+13,3%/annuel

- Maintaining strong commercial positions in volume and value. Strong improvement of 3G coverage. - Deployment of THD with LTE (4G, TDD) and fiber solutions. - Strengthening the tax burden. - Growth in sales impacted by the change in Orange Money accounting method.

97 Market and Competition

Guinea Position : Leader Market share Networks 2G - 3G

+1.1 pts

- Consolidation of strong commercial positions. - Development of the Orange Money business. - Important issues around the availability of resources (frequencies, numbers) and the finalization of the negotiations on licenses (concession, 4G). - Significant change in financial results.

Bissau Position : Leader Networks 2G - 3G - 4G Market share

+0.4 pts

- Maintaining strong commercial positions in volume and value. - Continued deployment of 4G coverage and Orange Money penetration. - Orange’s participation in Guinea Bissau’s major connection project to the ACE submarine cable. - Financial results impacted by the economic gloom.

98 Sonatel Annual Report 2018

Market and Competition

Sierra Leone Position : Challenger Networks 2G - 3G Market share

+4.5 pts

- Maintaining the dynamics of conquest in the region around the opening of new sites. - Discussions with the regulator (taxes...). - Acquisition of the 4G license.

99 Financial key figures

Turnover Ebitda

1 022 (+5%) 462,6 (+2.2%) Billion XOF Billion XOF Breakthrough of the 1 billion mark of Up 9.8 billion XOFCFAF in absolute value turnover up by 5% driven by the evolution but slight decline of EBITDA growth of Data and Orange Money. compared to 2017 (2.2% vs. 2.8%).

Drop of 1.2 points in the EBITDA rate to 45.3%.

Net Resultat CAPEX

202,3 stable 194,2 (+5.7%) Billion XOF Billion XOF

Up by 0.1 billion CFAF in absolute value. Up by 10.6 billion XOF of investments in absolute value. Stabilization of Net Profit after the drop of -6.3% recorded in 2017. The CAPEX rate is stable at 19%.

(-0,2%)

A drop of 0.7 billion CFAF in Free Cash Flow (-0.3%) due to higher investment growth compared to EBITDA (5.7% vs. 2.2%).

100 Sonatel Annual Report 2018

Operational key figures

FMI customers Mobile customers (Fixed + Mobile + Internet) (voice, sms and SVA)

29,7 (-1.7%) 29,1 (-2%) Million Million subscribers subscribers

Evolution of the FMI base impacted Mobile base drop by -2% compared to mainly by the slowdown in recruitment 2017 driven by the regression of the base in Mali following the cessation of bo- in Mali following the new approach of nuses on activation and refocusing value-based recruitment. the management of customers on va- lue-based recruitment. Outside Mali, the mobile base grew by 8.9%.

Data customers Orange Money customers (Internet Mobile)

10,8 (+17.5%) 5,6 (+26.1%) Million Million subscribers subscribers

Strengthening of the contribution Continued growth of business (+1.2 M of Data thanks to the competitive of active customers, turnover up by advantage on connectivity particularly +36.1% compared to 2017) and impro- with 4G in Senegal, Mali and Bissau. ved profitability.

Internet customers (ADSL + Fiber + Flybox + Wimax)

219,1 (+34%) Million subscribers In growth +34% compared to 2017, driven mainly by the convergence and the attractiveness of offers of ADSL, Flybox and fiber.

101 Network coverage

Guinea Senegal Mali Guinea Sierra Leone Bissau

Mobile penetration 105% 106% 101% 79% 54%

Population coverage 2G (%) 97.9% 94% 95% 90% 83.8%

Population coverage 3G (%) 92.2% 66% 56% 69% 41%

Population coverage 4G (%) 62.0% 31% N/A 34% N/A

Active 3G customers 3.6 3.9 1.3 0.2 0.8 (in millions) Active 3G customers 708 229 N/A 27 N/A (in millions)

Data penetration 40.7% 37.0% 18.4% 19.0% 41.0%

4G penetration rate 19.7% 5.7% N/A 3.9% N/A

Fiber (connectable homes) 79 426 3 274 N/A N/A N/A

102 Sonatel Annual Report 2018

Base subscribers: fixed, mobile and Internet

Subscriber base 2016 2017 2018 17/16 18/17

Fixed 277 859 285 294 302 243 2.7% 5.9%

Mobile 27 319 568 27 319 568 29 146 650 8.8% -2%

Internet 143 620 144 753 219 144 0.8% 51%

TOTAL 27 741 047 30 166 130 29 668 037 8.7% -1.7%

- Mobile: -2% decline in the base, driven by the sharp drop in the base in Mali by -16.5% due to the refocusing on value-base recruitment which attenuated the increase of the base in the other countries.

- Fixed: good performance with an increase of +5.9% compared to 2017 driven by connections with the Flybox and fiber.

- High-speed Internet: +51% growth compared to 2017, mainly driven by the convergence and attractiveness of offers of ADSL, Flybox and fiber, particularly in Senegal, and the gradual migration of customers (Mali, Guinea) from WIMAX to 3G (Flybox) combined with the good recruitment dynamics still on the Flybox in Bissau.

Fixed in thousands Mobile (in million) Internet in thousands

Sonatel: Financial Results 2018

103 Mobile subscriber base

Subscribers 2016 2017 2018 17/16 18/17

Senegal 7 900 150 8 344 083 8 734 542 5.6% 4.7%

Mali 11 262 654 12 539 918 10 468 834 11.3% -16.5%

Guinea 6 032 667 6 783 073 7 268 259 12.4% 7.2%

Bissau 600 384 646 573 682 701 7.7% 5.6%

Sierra Leone 1 523 713 1 422 436 1 992 314 -6.6% 40.1%

TOTAL 27 319 568 29 736 083 29 146 650 8.8% -2%

- Senegal: return of the base to the pre- identification level thanks to a better control of the churn, the increase in the acquisitions and the good commercial dynamics of the 4G justifying the growth of 4.7%.

- Mali: 16.5% drop in the number of employees following the cessation of massive recruitments in favour of the acquisition of value-oriented cus- tomers.

- Guinea: maintaining the pace of re- cruitment driven by the combined actions to open new sites, the 3G co- verage of all 304 sub-prefectures and sustained commercial animation des- pite the constraints of customer iden- tification.

- Bissau: evolution of the base (+5.6%) thanks to the dynamism of the new offers on the uses of Mobile Data and Orange Money.

- Sierra Leone: the subscriber base grew +40.1% thanks to the exten- sion of coverage, the new dynamic of conquest backed by the expansion of the network of branches and innova- tive offers (bundles).

104 Sonatel Annual Report 2018

ARPU

Monthly ARPU Segment 2016 2017 2018 17/16 18/17 average Senegal Fixed 95 084 94 838 73 579 -0.3% -22% FCFA Prepaid mobile 2 661 2 794 3 063 5% 9.6% Mali Prepaid mobile 1 912 1 618 1 930 -15.4% 19.3% FCFA Guinea Prepaid mobile 26 006 26 448 26 452 1.7% 0.0% GNF Guinea Bissau Prepaid mobile 2 842 2 832 2 701 -0.4% -4.6% FCFA Sierra Leone Prepaid mobile 18 230 19 542 18 729 7.2% -4.2% SLL

Sonatel: Financial Results 2018

- Senegal: increase in Senegal due to the strong growth of mobile recharges thanks to revenues generated by mobile data, the strengthening of the contribution of Orange Money use, value-added services and terminal sales, despite the decline in international incoming revenues..

- Mali: ARPU growth driven mainly by income stability in the face of a sharp decline of the base (preservation of the recharge base and value).

- Guinea: the stability of ARPU following a growth of the base and incomes in the same proportions, reflecting a good management of the abundance level.

- Guinea Bissau: decrease in ARPU mainly due to a faster growth of subscriber base than income, the level of free access linked to the explosion of abundance, and the decline of the inbound international.

- Sierra Leone: decline in ARPU following a strong growth of the base greater than income.

105 Data Mobile

Turnover ARPU mobile data

192 (+41.3%) 1 483 (+20.3%) Billion XOF XOF

In % group Turnover Contribution to Turnover

18,7% (+4.8%) 114% (+1.9%)

Active mobile data customer Delta customer base

10,8 (+17.5%) 1,6 (+17.5%) Million Million subscribers subscribers

4G active customer

1 328 (+88.2%) Million subscribers

Sonatel: Financial Results 2018

106 Sonatel Annual Report 2018

Orange Money

Turnover Value of transactions

62,8 (+36.1%) 8 000 (+53.8%) Billion XOF Billion XOF

In % group Turnover Contribution to turnover growth

6,1% (+1,4%) 33,9% (+5,8%)

Orange Money Client customer Active

13,1 (+11.6%) 5,6 (+26.1%) Million Million subscribers subscribers

Volume of transactions Value of transactions/GDP

800,6 (+70.6%) (+4.1%) Million 24,5%

107 Turnover

Contribution to turnover by activity

Weight in activity Growth

Fixed Mobile 7.1% 3%

Data Mobile 49% 1%

SVA Orange 19% 41%

Money 4% 5%

Wholesale 6% 36%

International 13% -20%

Others 1.5% 11%

- Preserving Senegal’s presence and strengthening Guinea in the Group’s main financial indicators. Slowdown of Mali’s contribution due to the change in accounting method of prepaid revenue and Orange Money.

- Revenue growth of 49.1 billion CFAF mainly in Senegal and Gui- nea. It is driven by Data Mobile and Orange Money, Fixed Internet and Group Integration, despite the withdrawal turnover of the international inbound and Fixed Voice.

108 Sonatel Annual Report 2018

Margins

Margin EBITDA margin operating Net margin 48.7% 46.5% 35.7% 45.3% 31.6% 30.6% 23.9% 20.8% 19.8%

Average margin decreases by 1 point largely driven by tax and regulatory impacts, but also by strengthening lower margin revenue lines (Data Mobile, Orange Money and Value-Added Services).

109 Financial indicators

2015 2016 2017 2018

Debt ratio 0.3% 0.3% 26.5% 26.5%

Debt ratio/Free cash flow 1% 1% 58.7% 70.9%

2015 2016 2017 2018

715715716 717717 711711

692692

362 351343 351

290 336 269 366 351 336 190 268 290 286286 351 269 158158 190 268 22 2

Financial debts Equity Global Self Financing Capacity Free Cash Flow

110 Sonatel Annual Report 2018

Investments

Breakdown of investments by activity

Investment in Millions XOF 2017 2018 Variation 2018/2017

Networks 156 171 158 176 1.3%

Excluding networks 27 573 36 115 30.9%

TOTAL 183 744 194 291 5.7%

CAPEX rate 18.9% 19% 0.1 pts

Breakdown of investments by country

In billions XOF

The Sonatel Group’s investments in 2018 amounted to 194.3 billion XOF, a growth of 5.7% (+10.5 billion CFAF) with a stable CAPEX/turnover ratio of 19%. The 2018 CAPEX focuses primarily on the network, particularly in Mali, Senegal and Guinea with the goal of improving the quality of service and increasing our strategic ad- vantage over fixed and mobile broadband connectivity. CAPEX Excluding Networks is up 30.9%, mainly due to IT (+8.8%), service platforms (48.8%) and other fixed assets (50.8%).

Senegal Mali Guinea Bissau Guinea Sierra Leone

111 Share price

The downward trend in Sonatel’s share price stems from the general decline in the financial markets following an uncertain international economic climate.

Publication 2017 Results Publication Results H1 2018

136 195 121 693

84 865 76 405 77 923 61 875 51 378 48 577 44 900 49 070 48 609 37 158 31 920 35 560 35 019 20 834 25 270 20 359 23 320 12 115

Dividend policy

FINANCIAL 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 YEAR Stock Price 13 000 12 000 15 400 12 000 14 500 20 050 22 800 25 000 25 000 23 500 16 000 at 31/12 Dividend 130 135 140 145 150 155 160 167 167 167 167 (in G XOF) Net dividend 1 170 1 215 1 260 1 305 1 350 1 395 1 440 1 500 1 500 1 500 1 500 per share Dividend 18% 3.9% 3.7% 3.6% 3.5% 3.3% 3.2% 4.2% 0% 0% 0% growth rate Dividend yield 9% 10% 8% 11% 9% 7% 7% 6% 6% 6.4% 9.4% Dividend dis- tribution rate 77% 91% 82% 114% 87% 106% 92% 106% 108% 102% 156% (%) Sonatel SA Group Divi- dend distribu- 83% 73% 76% 94% 88% 82% 73% 76% 77% 82% 82% tion rate (%)

112 Sonatel Annual Report 2018

Contribution to the economy

+500 +242 Billions XOF Turnover Billions XOF Paid as taxes, royalties, Turnover generated Income social contributions, local for the benefit of local budgetary customs duties and businesses companies in the dividends in the countries of presence. countries of presence.

+160 000 +130 Indirect Jobs Billions XOF +4 500 Generated in Job Direct Jobs balance of payments Exports contributions by foreign creation Through extended telecommunications commercial distribution operators. and dynamic partners.

Staff

SONATEL GROUP 2015 2016 2017 2018 17/16 18/17

Senegal 1 807 1 788 1 774 1 805 -0.8% 1.7%

Mali 540 583 609 649 4.5% 6.6%

Guinea 354 374 379 399 1.3% 5.3%

Bissau 85 88 91 89 3.4% -2.2%

Sierra Leone - - 182 191 - 4.9%

TOTAL 2 786 2 833 3 035 3 133 7.1% 3.2%

113

FINANCIAL 8 REPORT NOTE TO THE READER

1. The consolidated financial statements include the accounts of Sonatel and all its subsidiaries directly or indirectly controlled. These subsidiaries are consolidated according to the global integration method. Orange Sierra Leone, which is 50% owned, is fully consolidated in accordance with the terms of the Shareholder Agreement.

2. Groupement Orange Service has been included in the scope of consolidation by the equity method.

3. Transactions, balances and reciprocal results between the integrated companies are eliminated.

4. The consolidated financial statements are presented in XOF. The assets, liabilities and income statement items of the non-XOF subsidiaries are translated at the exchange rate prevailing at the end of the period.

5. The consolidated financial statements of the Group are prepared in accordance with SYSCOAHADA.

6. With the entry into force of the reform of SYSCOAHADA revised as of 1st January 2018, the accounts closed at December 2017 have been restated to comply with the new reform and thus allow the comparability of the two financial years. On the presentation of the financial statements as of 31 December, 2018, 2017 is presented in 2 columns: R=2017 real; P=2017 in proforma, that is to say, restated according to the SYSCOAHADA reform.

Percentage Country Companies Holding held Sonatel SA Direct ParentComp Sonatel Mobiles Direct 100% Sonatel Multimedia Direct 100% Senegal Sonatel Business Solutions Direct 100% Orange Mobile Finance Senegal Direct 100%

Orange Mali Direct 70% Mali Orange Mobile Finance Mali Indirect 70%

Orange Guinea Direct 89% Guinée Orange Finances Mobiles Guinea Indirect 89%

Bissau Orange Bissau Direct 90%

Orange Sierra Leone Direct 50% Sierra Leone Orange Money SL Limited Indirect 50%

Orange Services Group Indirect 47% Entry in 2018

116 Sonatel Annual Report 2018

INTRODUCTION

In 2018, the Sonatel Group achieved strong thanks to the dynamic of conquest that made operational and financial performance thanks to it possible to resist the offensive of the main the strengthening of its competitive edge in very competitor during the recovery phase, and high speed connectivity and Mobile Financial to return to the level of the base before the Services, improved operational excellence and downward adjustment measures related to customer experience. This despite a contrasting identification (December 2016). economic context in its various countries of presence. The symbolic bar of the Group’s 1,000 The Group’s fixed-mobile-internet customer billion consolidated revenue has been crossed, base stands at 29.7 million customers at the end allowing for a growth improvement of 5%, of 2018, down 1.7% from 2017. It is driven by the compared to 2017. evolution of Mali’s mobile base in connection with the new strategy of value-oriented recruitment Nevertheless, a slight decline in EBITDA growth and customer compliance. Outside Mali, there was registered, compared to 2017 (+2.2% vs. is a very good recruitment dynamic (+8.9% +2.8%) due to new tax impacts combined with compared to 2017), driven by Guinea, Senegal unfavorable regulatory decisions regarding ter- and Sierra Leone. mination rates on mobiles. The change in EBIT- DA registered over the full year 2018 remains The pursuit of marketing initiatives against better than that recorded during the first half of competition offensives, based on our strategic 2018 (+2.2% vs. +0.9%). advantage of very high-speed connectivity (4G, LTE, Fiber TTH) supported the strengthening The net result was stabilized at +0.03% compared of data usages (10.8 million users including to 2017 after the similar declines recorded in the 1,3 million 4G users), the consolidation of fixed 1st semester 2018 (-6.2%) and in 2017 in total broadband growth (+34% compared to 2017) on year (-6.3%). access to ADSL, Flybox and FTTH in Senegal, development of LTE/TDD access, Flybox and The level of investment remains sustained with fiber access in France. Mali, Flybox access in a CAPEX/turnover rate maintained at 2017 level Guinea as well as the development of Orange (19%), a relative increase of +5.7% compared to Money services (+1.2 million active customers 2017, with an acceleration of the rollout in the compared to 2017). second half 2018 (-12% annual over the first half of 2018). The Group maintained 7.2% revenue growth in 2018 (excluding the impact of the change The Group strengthened its leadership while in accounting method and adverse currency consolidating already strong commercial posi- effects). In nominal terms, revenue growth was tions in Guinea (+1.1 pt compared to 2017) at +5.0% compared to 2017. 63% of market share, conquered market shares in Sierra Leone (+4.5 pts compared to to 2017) In the wake of the revenue growth, profitability at 44.9% and stabilized its market share volume trajectories have improved. It is reflected by the (+0.4 pt) to 56.2% while strengthening its market continued growth in EBITDA in nominal terms share value in Bissau. The change in recruitment of +2.2%, which is relatively similar to that of policy focused on compliance and customer va- 2017 (+2.4%), despite the unfavorable tax and lue in Mali explains the decline in market share regulatory decisions that negatively impacted volume (-4.5 pts compared to 2017) to 56.5%. the Group’s EBITDA rate by 1.3 percentage The market share volume remains relatively points (46.6% against 45.3% in nominal terms), stable in Senegal around 53%, representing 3.5 points of growth (+5.7% against +2.2% in nominal terms).

117 The Group’s EBITDA rate declined compared to costs resulting from exceptional items in 2018 2017 (-1.2 points) due to the greater weight of (job exits, salary increase, share distribution). the cost-bearing income lines (Orange Money, SVA, content, terminals), and the decline in core The net result for 2018 is stable compared to business revenues (international incoming, fixed 2017. The increase in EBITDA is partly offset by voice, mobile voice) major contributors on the the increase in depreciation, combined with the side. decrease in the financial result in Senegal and Mali and the increase in corporate income tax. In nominal terms, the decline in the EBITDA rate The Group’s investments, excluding licenses, (-1.2 points compared to 2017) is less significant amounted to more than 194 billion XOF for than that of 2017 (-2.1 points) with a -1.3 point the 2018 financial year, ie close to 19% of differential effect caused by fiscal and regulatory consolidated turnover, to which are added more impacts. The level of transformation of the than 25 billion XOF of licenses, among others, in increase in revenues up EBITDA remains low, Senegal (LTE/TDD frequency acquisitions) and in however, leading to a decrease in the EBITDA rate Sierra Leone (acquisition of 4G frequencies). of 1.2 points in the year, despite the improvement of the direct margin of 34.3 billion XOF, nearly In 2018, the Sonatel Group conducted significant 70% of the increase in revenues (+49.1 billion operations for the continuity of its activities by XOF). The evolution of indirect costs excluding acquiring the frequencies for the roll out of 4G staff costs (+10 billion XOF) represents nearly in Sierra Leone and becoming a member of the one third (33%) of the increase in direct margin consortium managing Guinea Bissau’s access to (+34.3). This upward variation is recorded on staff the ACE submarine cable.

In Senegal, it should be noted that annual revenues of consolidated Senegal. Fixed-line revenue growth has rebounded to +3.1% after growth continues thanks to broadband offerings two successive years of decline recorded in 2016 of Flybox and FTTH (+6,000 customers). The and 2017. number of monthly active users of Orange Money mobile money services has crossed the 2 million The consolidation of the gains on the strategic mark, an annual growth of +29% confirming the edge in very high speed connectivity afforded good momentum on this important growth driver. by multiple technologies (4G, LTE, Fiber TTH) combined with the extension of the dynamics The evolution of revenues remains characterized of conquest, based on prepaid mobile offers by the transformation of the mix between core revamped as part of the «Sun» project in S2 business activities (mobile voice, fixed voice, 2017, the recruitment plan on 4G backed by the incoming international traffic) in sharp decline in 4G coverage extension programme (all regional favor of businesses positioned as growth drivers capitals covered) and the continuation of price (mobile data, Orange Money) whose scaling up cuts (act 2 Internet revolution), contributed a lot helps cover the effects of declining business and to the achievement of a significant delta base keeps revenue trajectories growing. The decline of +390,000 customers. There is a rebuilding of international incoming traffic volumes remains of the base before subscriber base compliance significant in 2018 (-22.5% compared to 2017, ie operations (December 2016). -90 million minutes) under the effect of SIMBOX fraud from competing networks and further The acceleration of the roll out of 4G in Dakar development of the use of alternative channels and in the regions has encouraged the rapid amplified by the OTT phenomenon, largely development of the 4G active base to more than enhanced by the strong mobile data penetration. 447,000 customers compared to the end of 2017. However, the slope of profitability trajectories, The development of mobile data uses continues although stable despite the exceptional results in 2018 with the crossing of the 3.6 million bar of of 2017, remains topical from an organic point of active users, nearly 41% of the mobile base (+5 view. The decline in core business revenues on points compared to 2017). highly contributive lines on the side is favoring the growing weight of revenue lines with high The increase in the base and usage was incidental costs and lower margin. However, accompanied by a significant increase in the generation of new savings on direct costs revenues, up 48% compared to 2017 in data (outgoing international, commissions) can revenues, polarizing most of the growth in total contribute to the preservation of the EBITDA

118 Sonatel Annual Report 2018

margin in the face of declining revenues and the Investments have enabled the extension, gradual improvement of the level of profitability modernization and renewal of networks, and have of Orange Money and mobile data, without decreased slightly by XOF 1.3 billion, but remain covering the increases recorded in indirect costs at the sustained level of nearly 85 billion CFA including the impact on tax litigation. francs, or 18.2% of the consolidated turnover of Senegal (-1 point compared to 2017).

In Mali, Orange has increased its lead in There was a slight increase in inbound broadband connectivity by launching LTE/ international volumes by +1.4% compared to TDD and fiber and significantly improving 2017 thanks to the contribution of the corridors. 3G coverage. This helped maintain strong However, the decline in incoming international commercial positions in volume and value, even revenues continues, despite the offsetting effects if the change in recruitment policy focused on of the corridors, due to the impact of the use of compliance and customer value, resulted in a OTTs and the presence of SIMBOX fraud. decline in the displayed market share volume. Subscription bases recorded a drop of 16.5% The profitability trajectories remain relatively (around 1 million customers) following the stable thanks to the contribution of growth drivers cessation of massive recruitment in favor of the (mobile data, Orange Money) and the resistance acquisition of value-oriented customers, but on mobile voice which makes it possible to still represents the largest customer base of the dampen the rise in indirect costs of the effects Group with nearly 10.5 million customers. The induced by the introduction of new unfavorable market recorded a renewed vigour under the tax measures, and the operating costs of the impetus of bundle offers including a significant networks with the change of MSP. level of abundance extended to data, proposed by the two competing operators. The 2018 investments amounted to 57.2 billion XOF, an overall growth of +13.3% compared to The strong growth in data usage continued with a 2017 (+6.7 billion CFAF) of which more than 80% growth of +12% compared to 2017, an increase from the network. The 2018 extension programme of +36% over the period, representing more than has covered 1,883 sites, improving the coverage 7 times the total revenue growth of Orange Mali rate of the population. The investments made recorded in 2018. The Orange Money business it possible to increase the data traffic flow also experienced significant growth, enabling capacities in line with the explosion of usage, it to crossing the 2.1 million monthly active and the innovation of LTE/TDD and fiber. customer bar, an increase of +14% compared to 2017, while revenues show a drop of -5,7% over the period as a result of the change in accounting (commissions paid on cash transactions are decreasing Orange Money turnover).

119 In the Republic of Guinea, Orange strengthe- 2017), and a +37% growth of income generated. ned its leadership position with a market share This business development took place in a diffi- volume of 63.3%, up +1.1 points compared to cult context of saturation of the network capaci- 2017, thanks to a delta base of nearly 500,000 ties accentuated by the delayed provision of the subscribers achieved despite the identification frequencies (4G, discussion in progress) and the constraints. Leadership has also been strengthe- 3rd carrier. ned in value with a market share of 67.7%, ac- cording to the latest publications of the Regula- The profitability trajectories recorded are up tory Authority (Quarter 3 2018). compared to 2017 on EBITDA. This change in the operating margin reflects a similar increase The number of mobile subscribers has passed in revenues and operating expenses (mainly in- the bar of 7.3 million customers, up 7.2% in a direct costs). context of fierce competition. The development of the Orange Money business remains sus- The amount of Orange Guinea’s investments in tained with a growth of nearly 37% in the number CFAF rose significantly by 22.6% to 2017 (33.5 of monthly active users of services and a near billion XOF), for network expansion and de- doubling of revenues compared to 2017 on an ployment needs (2G, 3G, LTE and Common In- active user base of more than 1.2 million cus- frastructure) in connection with the launch of 25 tomers by the end of 2018. additional sites. Capacity building on energy with the acquisition of photovoltaic generators and in- The strong growth of the Mobile Data business verters, acquisition of land for headquarters and continued in 2018 with the crossing of the bar of development of two agencies, strengthening of 2.4 million active customers (+22% compared to service platforms and IT.

In Guinea Bissau, Orange has consolidated The improvement in operational excellence has its leadership through its market share volume resulted in the consolidation of the leadership (56.2%), up +0.4 point compared to 2017. measured through the NPS barometer of the Maintaining the dynamic of conquering the perception of the customer experience delivered Guinea Bissau market through the continued by the various operators present on the market. expansion of network coverage, improvement of the quality of service, rollout of 3G/4G, has The financial trajectories were marked by a helped increase the volume of recruitment of relative stability of the revenues and a decrease mobile customers to 36.1K mobile customers, of the EBITDA compared to 2017. up 5.6% over 2017. Investments in 2018 (5.2 billion XOF, +12.8% In the wake of this, we note a strong improvement compared to 2017) have consolidated the in the number of mobile Internet users in 2018 leadership of Orange Bissau through the (+45% compared to 2017), which was reflected continued development and modernization in revenue growth of +16% over the period. efforts of the Network.

In Sierra Leone, the strong momentum The continuation of Orange Sierra Leone’s of conquest made it possible to cross the network rehabilitation, expansion and moderni- threshold of 2 million mobile customers (+40.1% zation programmes, infrastructure and IT skills compared to 2017), ie a delta base of +569K has significantly increased operational excel- customers in 2017. The regulatory environment lence and improved quality service has evolved with the renewal of the players, the establishment of a dialogue with the operators to the customer. Capital expenditure amounted and careful attention to their concerns, thanks to to 13.6 billion XOF and mainly focused on the the change of administration in the aftermath of network, especially on its modernization in the democratic transition achieved in early 2018. 2G/3G and transmission.

120 Sonatel Annual Report 2018

The profitability trajectories, in addition to the effects. In addition, the operational difficulties exogenous penalizing factors, were impacted by on the 1st 2018 semester of providing optimal structural costs linked to the continuity of certain network capabilities for the flow of voice and services outsourced by Airtel (IS management, data traffic have been detrimental to business FRA tools), by catching up on operating expenses during 2018. (site management, fuel), by the effects of capping the incomes from the international inbound Orange Sierra Leone obtained at the end of against the increasing price of international December 2018, the authorization of the regulator outbound costs including significant currency for the acquisition of 4G frequencies.

The 2018 financial year was characterized for the Sonatel Group by:

Environment and Context

Competition Country

- TIGO Senegal takeover finalization, 4G frequency acquisition - Security context still strained in northern Mali, re-election of outgoing - Maintaining strong commercial positions in volume and value. president, installation of new government - Start-up business 3rd operator (QCELL) in Sierra Leone - Political impasse in Bissau, government instability - Start-up business 3rd operator (TELECEL) in Mali - Political tensions and crisis in several social sectors in Guinea - 4G launch by competitors in Mali and Sierra Leone - Democratic transition in Sierra Leone, installation of new government - Cessation INTERCEL business in Guinea - Increase of OTTs and SIMBOX fraud - Conquest and confirmation of Orange Money’s leadership on local transfer (Senegal)

Offers Revenues and expenses

- 4G+ launch in Senegal and Mali - Maintain revenue growth outside - Launch of Orange Energy (Mali, Guinea and Senegal) - Significant revenue growth driven by the boosting of the contribution of - Launch of fiber optic in Mali Data Mobile and Orange Money - Launch of LTE/TDD in Mali - Regulatory and accounting impacts - Supporting the emergence of digital in Senegal; rollout of Act 2 of the - Economy on direct costs (outgoing international, commissions for Internet Revolution (commitment undertaken in 2017 to cut mobile distributors, terminals) to maintain a sustained level of EBITDA margin Internet tariff by 50% in 2019, achieved in 2018) generation - Launch of Orange Money France international transfer to Guinea - Good control of direct costs; significant tax impact on the evolution of - Development of the data usages and voice ultrabundance indirect costs

Client experience Economy - - Increase of the tax burden in all countries of presence - COPC certification confirmation in Senegal - Favorable economic situation in Senegal and Mali - NPS leadership and improvement in Senegal - Economic gloom in Bissau - 4G coverage in all regional capitals of Senegal - Currency exchange rate issues (depreciation) of the Leone and the - Huawai new MSP contract, improvement of NUR (Mali) Guinean franc

Regulation Capex and Financing

- Frequency allocation for 4G in Sierra Leone - Boosting of investments in the Group - Retroactive decrease in national interconnection tariffs in Senegal with a return to symmetry - Continuation of disbursements for the (9F/11F to 6F/6F per minute) acquisition of licenses (Sierra Leone, Mali and - New interconnection tariff signified by AMRTP (Mali) at 11 CFAF/min for 2018 and 2 CFAF/SMS Senegal) - sustained debt level (Senegal and - Sustainable Development Fund (0.5% of turnover) applicable since mid-February 2018 in Mali Mali) linked to external cash flow (spot and - Launch of ARTP unbundling of the local loop to benefit other operators and ISP of the Sonatel medium-term credit) subsidiary network - Implementation of medium-term financing - Frequency allocation for LTE TDD (Senegal) to cover cash requirements accentuated - Free Roaming ECOWAS: Integration of Côte d’Ivoire and Benin by exceptional disbursements (licenses, - Negotiations under way in Guinea for the acquisition of 4G frequencies frequencies, CAPEX) - Introduction of the CST tax to replace the CODETE and the PST with a rise in the level of 1% levy (increased from 4% overall to 5% of turnover excluding interconnection costs (Senegal))

121 1 OPERATIONAL ELEMENTS

The evolution of the Group’s fixed, mobile and The mobile financial services customer base and Internet subscriber bases has been marked by mobile data users have increased significantly the slowdown in recruitment in Mali following (+26.1% and +17.5%), thanks to the explosion of a change in the recruitment policy focused on usage favoured by the extension of the network compliance and customer value (end of activa- coverage supported by a generous pricing poli- tion bonuses and promotions on SIMs in the first cy. The penetration of these mobile subscriber half of 2018), which led to a decline in a -1.7% base services has been consolidated with nearly decrease of the base compared to 2017, against one in four active mobile data subscribers (36%) a +8.9% growth outside Mali. and one in five mobile customers 19%) that is a monthly user of Orange Money mobile financial Maintaining the momentum of conquest in other services. countries in innovation and good commercial performance has helped significantly reduce the The growth in traffic volumes originating from the decline in the base, including Mobiles in Mali. The networks, especially on-net, continued, favoured strong growth of Fixed-line and Internet bases by the increase in the abundance level, particu- with respective growth rates of +5.9% and +34% larly for voice usage. On the other hand, the de- was achieved mainly thanks to the recruitment cline in volumes of international inbound traffic, related to the Flybox in Bissau combined with the although mitigated by the introduction of corridor positive contribution from the continuation of the offers between the countries of the Sub-Region, Internet price reform in Senegal and the improve- accelerated in 2018. ment of the operational rollout of fiber.

Subscriber 2016 2017 2018 17/16 18/17 base Fixed 277 859 285 294 302 243 2.7% 5.9%

Mobile 27 319 568 29 736 083 29 146 650 8.8% -2%

Internet 143 620 144 753 219 144 0.8% 51%

TOTAL 27 741 047 30 166 130 29 668 037 8.7% -1,7%

Mobile Internet Base (in thousands of subscribers) Orange Money Base (in thousands of subscribers)

Senegal 3 553 Senegal 1 984 Mali 3 874 Mali 2 085 Guinea 2 394 Guinea 1 165 Guinea Bissau 129 Guinea Bissau 22 Sierra Leone 816 Sierra Leone 377 TOTAL 10 767 TOTAL 5 634

122 Sonatel Annual Report 2018

1.1 Fixed

The fixed-line customer base totals more than 300,000 lines at the end of 2018 (+5.9%/2017). This is an improvement on growth recorded in 2017, driven mainly by the commercial success of offers Flybox and fiber offers, combined with the rise in net ADSL connections, all thanks to the new price reduction in the framework of act 2 of the Internet revolution in Senegal.

1.2 Internet

Growth in fixed broadband access remained strong at +34% in 2018 compared to +14% in 2017 with a customer base of 219,000 including 82,000 Flybox customers and 7,000 fiber customers. This performance reflects the success of fixed boadband offers via the multiple technologies (ADSL, Flybox, fiber, LTE/TDD).

1.3 Mobile

The Group’s mobile subscriber base stands at 29 million at the end of 2018 and is down -2% compared to 2017, driven by Mali, which revised its recruitment policy by stopping massive recruitment and activation bonuses, focussing instead on customer compliance and value of the recharging base. In the Group’s scope outside Mali, the +8.6% growth was driven by a conquest momentum supported by our strategic edge in network coverage and fixed and mobile broadband connectivity. The base of postpaid mobile customers totals 176,000 customers, up +20.2% over a year, largely driven by the positive effects of the reform in Senegal. The 4G active user base is 1.3 million customers and is up 88% compared to 2017.

Subscribers 2016 2017 2018 17/16 18/17

Senegal 7 900 150 8 344 083 8 734 542 5.6% 4.7%

Mali 11 262 654 12 539 918 10 468 834 11.3% -16.5%

Guinea 6 032 667 6 783 073 7 268 259 12.4% 7.2%

Bissau 600 384 646 573 682 701 7.7% 5.6%

Sierra Leone 1 523 713 1 422 436 1 992 314 -6.6% 40.1%

TOTAL 27 319 568 29 736 083 29 146 650 8.8% -2%

123 1.4 Number of staff

The number of permanent employees of the Group stood at 3,133 at the end of 2018 corresponding to an increase of 3.2% (+98 employees over one year). This evolution is mainly accounted for by Guinea, Mali and Senegal. By entity, the headcount breaks down as follows:

Sonatel Group 2015 2016 2017 2018 17/16 18/17

Senegal 1 807 1 788 1 774 1 805 -0.8% 1.7%

Mali 540 583 609 649 4.5% 6.6%

Guinea 354 374 379 399 1.3% 5.3%

Guinea Bissau 85 88 91 89 3.4% -2.2%

Sierra Leone - - 182 191 - 4.9%

TOTAL 2 786 2 833 3 035 3 133 7.1% 3.2%

124 Sonatel Annual Report 2018

2 FINANCIAL ELEMENTS

In billions 2016 2017 2017 PF* 2018 17/16 18/17 18/17 PF*

Turnover 905 972.9 972.9 1 022 7.5% 5% 5% EBITDA 440,5 452.8 451.9 462.6 2.8% 2.2% 2.4% EBITDA margin 48,7% 46.5% 46.4% 45.3% -2.1 pts -1.3 pts -1.1 pts Operating result 323,2 307.8 306.9 312.3 -4.8% 3.3% 3.6% Operating margin 35,7% 31.6% 31.5% 30.6% -4.1 pts -1 pts -0.9 pts Net profit 215,9 202.2 201.5 202.3 -6.3% 0.0% 0.4% Net margin 23,9% 20.8% 20.7% 19.8% -3.1 pts -1.0 pts -0.9 pts CAPEX 153,9 183.7 183.7 194.2 19.4% 5.7% 5.7% CAPEX rate 17% 18.9% 18.9% 19% 1.9 pts 0.1 pt 0.1 pt Free Cash Flow 286.6 269 268.2 268.3 -6.1% -0.2% -0.04%

2.1 Turnover

The Sonatel Group’s 2018 revenue amounts to XOF 1,021.9 billion, a growth of 5% (+49.1 billion XOF) compared to 2017. The evolution of the turnover on a comparable basis (neutralization of the exchange rate effects of the Guinean Franc and Leone) is +4.8% compared to 2017 corresponding to a favorable foreign exchange impact of 2.3 billion mainly in Guinea (+4.3 billion XOF), the depreciation of the Leone having caused an unfavorable impact of -2 billion XOF. Revenue growth is mainly driven by Guinea and Senegal, and to a lesser extent Mali (impacted by the change in accounting method), Sierra Leone and Bissau thanks to the increase in mobile revenues (usage data and SVA) and the Orange Money business. Revenues from international inbound traffic decreased in all entities with 71.8% of the decline in Senegal.

Turnover by country Turnover by activity 2% 4% Weight in Growth the activity 18% Fixed 7.1% 3% 42% Mobile 49% 1% Weight by country Group turnover Data Mobile 19% 41%

SVA 4% 5%

Orange Money 6% 36% 34% Wholesales International 13% -20% Senegal Mali Other 1.5% 11% Bissau Guinea Sierra Leone

125 Mobile business accounts for 796.4 billion XOF, The decline in Senegal is mainly due to a drop or 77.9% of consolidated revenues, and remains in international inbound volumes (-89.9 million the main contributor to the turnover Revenues minutes) following the development of alternative increased by 79.4 billion XOF compared to 2017, channels (OTT). The arrival of new corridors has driven by the strong growth of our business nevertheless mitigated the decline in volumes activities, particularly mobile data and VAS despite a dilution effect on prices. Hubbing (+35.7%), and the Orange Money business posted a growth of 0.8 billion CFAF due mainly (+36.1%). The growth of prepaid recharges to a price effect. (driven by the development of the monetization of mobile data and VAS usage), supported by There is also a decline in international inbound in sustained marketing and commercial animation, Guinea and Mali, due to the strong penetration help maintain a significant «prepaid recharging» of OTTs and the impact of free roaming, partially base within the Orange active base, with a slightly mitigated by the launch of new corridor offers. growing ARPU in the Group’s main markets (Senegal, Mali, Guinea). The Fixed business accounts for 28.9 billion XOF of turnover in 2018 and was mainly achieved by The revenue growth of the mobile business is Senegal and Mali to a lesser extent. It accounts mainly driven by Senegal (+39.4 billion XOF) for 2.8% of the consolidated turnover. Revenues and Guinea (+31.7 billion XOF) supported by generated by this activity decreased by 4.5% the monetization of mobile data usage, Orange compared to 2017, driven mainly by the decline Money and VAS, in the context of dwindling in Senegal due to the decline in fixed voice usage revenues derived from the use of mobile voice and the continued decline in the State bill. and SMS. Income from the local interconnection The significant evolution recorded in Guinea is amounted to 29.9 billion XOF or 2.9% of driven by the increase in subscriber bases (+485 consolidated turnover and recorded a 13% thousand subscribers compared to 2017) and decrease, mainly driven by Senegal and Mali. the increase in the level of usage favored by Senegal recorded a decline, following a -33% the extension of the coverage, the improvement drop in regulated call termination rates on mobiles of the network quality and popularization of (from 9 XOF in 2017 to 6 XOF in 2018), which smartphones. In Mali, a rise in mobile revenues of absorbs the positive volume effect correlated to 5.3 billion is noted in particular with Data, despite the proposed ultra-abundance by competitors. the change in method of accounting for prepaid Mali, also impacted by lower interconnection revenue (adjustment in 2017) and Orange Money rates, recorded a decline despite the increase (commissions paid on cash now decreasing in in volumes induced by the networks abundance income). The development of the Orange Money offered by competition. business is continuing with the expansion of the ecosystem and the introduction of new services Income from Fixed Internet and data amount in partnerships with financial institutions. to 55.1 billion XOF and represent 5.4% of the Group turnover. It increased by 7.6% compared Orange Bissau also recorded growth in mobile to 2017, thanks to the revitalization of the Inter- revenues thanks to operational actions, the net offers (internet redesign) and Internet leased extension and improvement of network coverage lines. Revenues are growing mainly in Senegal reflected by the strengthening of leadership (ADSL, Flybox and Internet leased lines), Mali (market share volume up +0.4 points). (Flybox) and Guinea (Internet leased lines)

In Sierra Leone, mobile accounts for 73% of The other wholesale income (leased lines, turnover, mainly from voice, mobile data, VAS roaming operator) amount to 10.8 billion XOF and and Orange money to a lesser extent. represent 1.1% of turnover. These revenues are down compared to 2017 mainly on the roaming The turnover of international inbound: 97.4 operator in Sierra Leone and Senegal, and on billion CFAF, representing 9.6% of consolidated leased lines in Senegal. turnover (12.8% in 2017) and is down 21.9% compared to 2017.

126 Sonatel Annual Report 2018

2.2 Operating expenses

The Group’s operating expenses amounted to 757.6 billion XOF, an increase of 7.3% compared to 2017. This increase is borne by Guinea 39%, Senegal 31%, Mali 31%, Sierra Leone 9%, and Bissau 1%.

The increase in operating expenses is broken down as follows: network expenses +31%, staff costs +28%, provisioned expenses + 19%, operating expenses +13%, depreciation + 10%; commercial expenses remained stable, against external charges slightly down -1%.

Breakdown of operating expenses

21% 21%

37% 37%

4% 5%

5% 2017 5% 2018

10% 9%

10% 13% 10% 14%

Depreciation External charges Staff costs Network Provisioned expenses Commercial expenses Expenses Operating expenses

The network expenses amount to 277.2 billion a lesser extent in Senegal for site electricity, IT XOF. They are up 6.1% compared to 2017, fees, outsourcing the production of subscriber against an increase of 11.7% between 2017 and lines in connection with the rollout of fiber; and 2016. in Sierra Leone for RAN 2G/3G maintenance and support costs This increase recorded in 2018 is explained by: 2. Rental expenses, particularly for FH costs and 1. Increasing maintenance and energy costs in royalties in Mali (universal access fund and Mali due to the costs of outsourcing network the sustainable development fund indexed management and supervision (new Huawei to turnover); as in Guinea, where the costs of MSP), and the cost of resupplying the sites. rentals and royalties are increasing, particularly Similarly, in Guinea with the increase in GNOC the SU indexed to the turnover, the FH linked and ANO subcontracting costs correlated to to the base and the local interconnection tax the extension of the network. They increase to based on increased traffic.

127 3. Network access fees were down in Senegal growth is mainly due to the costs of guarding and Mali, driven mainly by the fall in wholesale, the sites in Mali following the transfer of ANO as a result of lower volumes, and the to Huawei, training expenses and rental costs withdrawal of international backbone access in Senegal in connection with the development thanks to the optimization of capacity leases. of the business (OFMS, Digitalization) as well as bandwidth loads (decrease in the cost of the fees in particular in Senegal and Sierra Leone. MHz, abandonment of links ...) Staff costs amounted to 108 billion XOF in Commercial expenses amount to 72 billion 2018, an increase of 15%. This increase is due XOF and are relatively stable compared to 2017. to significant retirements and early retirements They increase in Guinea, Senegal, Bissau, and (including the costs of free shares sold), the Sierra Leone but are down in Mali. The increase increase in employee compensation, as well as in commercial expenses is mainly related to the growth in permanent staff and temporary commissions on Orange Money transactions and staff. to sales commissions indexed to turnover, with a mitigating effect resulting from lower purchases Provisioned expenses amounted to 38.4 billion of equipment, notably refill cards for Ereload. XOF, up 35% from 2017, of which 8 billion XOF in Senegal, driven by an increase in the depreciation External costs of the Group amounted to 71.9 of trade receivables due to the depreciation of billion CFAF and decreased by 0.6 billion XOF parastatal accounts and the CSU Consortium compared to 2017. This is mainly driven by in Senegal, and higher provisions for risks and Senegal, which is seeing its taxes decrease expenses. The rest of the increase is borne by following the reclassification of the non- Mali for 1.6 billion XOF due to provisions for risks deductible VAT in the expense accounts by and accrued liabilities. nature in accordance with the SYSCOA reform, and partly because of the decrease of the VAT Depreciation amounted to 150 billion XOF in pro rata rate. And finally, thanks to the savings 2018, up 3.7% compared to 2017. This increase made with the effectiveness of the VAT deduction concerns all countries except Guinea Bissau. on OFMS expenses. It is mainly due to the increase in the number of consecutive operations, the high level of In Mali, Guinea and Sierra Leone, external investments to support data growth and quality expenses are growing, driven by taxes, following of service obligations, as well as the amortization the increase in Tartop payments in Mali (tax of licenses and concessions renewed in Senegal on access to the telecom network open to the and in Mali. public) indexed on turnover and Tartel in Guinea. Similarly, Guinea’s management fees are correlatively increasing with revenue growth.

Running costs of the Group amounted to XOF 39.6 billion in 2018 and grew by 6%. They are growing in all the countries” - Senegal, Mali, Guinea, Sierra Leone and Guinea Bissau. This

128 Sonatel Annual Report 2018

2.3 Main management balances

Consolidated EBITDA of the Group amounted to 462.6 billion XOF in 2018. It recorded a nominal growth of +2.2% or +9.8 billion XOF compared to 2017, slightly less than in 2016 (+2.8%), thanks to the good performance achieved on revenues +49 billion XOF (+5%) associated with the rise in other products of +6.8 billion CFAF, largely slowed by the increase in operating expenses of 46 billion XOF. The EBITDA rate is 45.2%, down 1.3 points compared to 2017.

Consolidated Operating profit of the Group of 312.3 billion increases by 1.5% or 4.5 billion XOF. The margin rate was 30.6%, down 1.1 points due to the increase in depreciation of +5.4 billion or +3.7%.

Consolidated financial result of the Group is -13.9 billion XOF. It remains negative in 2018 and is down 4.8 billion XOF compared to 2017 following the increase in financial costs of 26% due to the increase in interest on loans; as well as the impact of the revaluation of the pension provision; exchange rate deteriorated by 1 billion XOF due to lower exchange rate gains in Senegal.

Consolidated net income of the Group amounts to 202.2 billion XOF. It remains stable in 2018, after successive declines noted in previous years. The decrease in pre-tax profit is mitigated by the withdrawal of the corporate income tax expense, with a favorable adjustment to the previous corporate income tax. Further, the decline observed in Senegal and Mali is offset by the strong performance of Guinea and Sierra Leone.

The net margin rate is nevertheless down 1 point.

129 2.4 Investments

The Sonatel Group’s investments in 2018 amounted to 194.3 billion XOF and remained stable in proportion to sales (19%) compared to 2017. Investment growth of 5.7% is noted in Mali and Guinea. The Group’s investments focused mainly on the network (extension and innovation projects), notably to improve the quality of service and cope with the growth of 4G (network modernization with the Mosaic project, rollout of 4G/LTE, IN platform...).

2017 VS 2018 VS In millions of XOF 2016 (*) 2017 2018 2016 2017 Capex Sonatel Group 153 907 183 744 194 291 19.4% 5.7% Networks 128 708 156 171 158 176 21.3% 1.3% Mobile access network 52 498 91 619 87 252 74.5% -4.8% Energy 24 201 22 217 22 285 -8.2% 0.3% Network core 13 411 7 350 9 626 -45.2% 31.0% Trans, Backhaul&IP 36 387 32 744 37 512 -10.0% 14.6% Other 2 210 2 241 0 1.4% 100.0% IT 12 189 12 710 13 835 4.3% 8.8% Service platforms 3 564 6 700 9 969 88.0% 48.8%

Other fixed assets 9 446 8 163 12 311 -13.6% 50.8%

(*) 2016 excluding Orange Sierra Leone

The breakdown of investments by country is as follows: Breakdown of investments by activity

Investment Variation 2017 2018 in millions XOF 2018/2017 Networks 156 171 158 176 1.3%

Excluding networks 27 573 36 115 30.9%

TOTAL 183 744 194 291 5.7%

CAPEX rate 18.9% 19% 0.1 pts

Breakdown of investments by country The Sonatel Group’s investments in 2018 (in billions XOF) amounted to 194.3 billion XOF, a growth of 5.7% (+10.5 billion XOF) with a stable CAPEX/ 14% turnover ratio of 19%. The 2018 CAPEX focuses primarily on the network, particularly in Mali, Senegal and Guinea with the goal 33% of improving the quality of service and increasing our strategic advantage over fixed and mobile broadband connectivity. CAPEX 5% 85% Excluding Networks is up 30.9%, mainly due to IT (+8.8%), service platforms (48.8%) and Senegal Mali other fixed assets (50.8%). 57% Bissau Guinea Sierra Leone

130 Sonatel Annual Report 2018

3 SITUATION BY COUNTRY

3.1 SENEGAL

Network 2G - 3G -4G - 4G+ Market share

-1.4 pts Inflation 0,5%

- Continued turnover growth throughout 2018 thanks to the increased contribution of Data Mobile and Orange Money (national transfer leadership). - Reinforcement of investments in growing businesses. - Broadening the competitive field with Mobile Finance and ISPs (Internet Service Providers).

3.1.1 Highlights 2018

1. Appointments of Sonatel’s Director General and Deputy Director General Mr. Sekou DRAME and Mr. Fabrice ANDRE; 2. Decrease in MTR (-33%) and interconnected leased lines (-49% on average); 3. Start of activities of ISPs (Internet Service Providers); launch by the ARTP of the unbundling of the local loop; 4. Completion of the sale of Tigo Senegal to the consortium (NJJ Capital, Sofima and Teylium Group), announcement of an ambitious investment programme, acquisition of 4G frequencies; 5. Introduction of the CST tax to replace the CODETE and the PST with an increase in the levy level of 1% (from 4% overall to 5% of turnover excluding interconnection fees); 6. Shorter development of the regulatory system for combating off-shore fraud (Senegal); 7. Establishment of a support fund for digital entrepreneurship; 8. QSE and COPC Certification Confirmation;

131 9. Maintaining strong commercial positions in volume and value; 10. Reinforcement data usage offers (diversification purchase channels, micro pass, smartphones.); 11. Act 2 of the Internet revolution, target of reducing prices by 50% by 2019, achieved in 2018; 12. Consolidation of revenue growth (full year 2018), 3 consecutive semesters since semester 2 2017; 13. Strong growth in the Orange Money business, improved profitability (+52 points compared with 2017) and won leadership on the national transfer; 14. Frequency acquisition for LTE/TDD and additional frequencies for 4G/FDD; 15. Commercial launch of 4G+; 16. Launch of Orange Energie; 17. Consolidation and improvement of NPS leadership; 18. 4G network coverage of all regional capitals.

3.1.2 Evolution of the main operational elements in 2018

Base The mobile base stood at 8.7 million customers at the end of December 2018, ie a delta base of 391,000 customers (+4.7% over one year). This is mainly driven by the good commercial performance of the year with usages including 4G and 4G+, postpaid redesign combined with better control of churn.

The growth in the fixed and fixed broadband subscriber base has notably strengthened, standing respectively at +5.9% and +27% over one year at 31 December, 2018 (versus 2.7% and 22% in 2017). This performance is derived from the good momentum of conquest with the new technologies of Fixed (Flybox and fiber) and the maintenance of recruitment on ADSL thanks to the implementation of act 2 of the Internet revolution.

The Orange Money base continues to grow and adds up to almost 2 million active customers (+442 thousand compared to 2017), driven by the growing awareness of the the domestic transfer product.

Traffic Increase in national volumes up 7.4% over the year, driven mainly by the reinforcement of free service with special offers, user bonuses and the Sargal loyalty programme. In this same register, off net traffic volumes also increased by 25.3% compared to 2017. Domestic traffic coming from competing mobile phones, driven by ultra-abundant offers from competing operators, grew by +16.3%.

Continuing decline in volumes of international incoming traffic impacted by SIMBOX fraud and OTTs, which explains the continuation of the decline at the same level as that of 2017 (-22.5%).

Number of Staff At the end of 2018, the number of permanent staff was 1,805, compared to 1,774 in 2017, or +31 agents recruited to cover the needs of the new digital and mobile money professions in particular.

132 Sonatel Annual Report 2018

3.1.3 Financial elements

Turnover Consolidated sales in Senegal at the end of 2018 amounted to 466.3 billion XOF, a growth of 3.1% compared to 2017. It is driven by the strong performance of Retail, thanks to mobile prepaid and Orange Money, which makes it possible to contain the structural decline of the international inbound and the withdrawal of the national inbound following the lowering of the price (ARTP decision).

Mobile business accounted for 68.9% of Senegal’s revenue (compared to 62% in 2017), or 321.5 billion XOF, up 13.9% driven by:

- Data/VAS, +32.8 billion CFAF, thanks to a record of mobile recharging over the year in relation to intensive promotion, and the increase of the recharging base favoured by a sustained commercial animation and the repositioning of prepaid mobile offers. This growth is also driven by the investment efforts on the expansion and densification of 3G/4G coverage as well as the continuation of market equipment actions (4G smartphones).

- Orange Money, +11.9 billion XOF, linked to the combined effects of the development of the active base (+442,000 subscribers) and the progressive growth of services billed (bill payment and cash out) supported by a strong animation at the pace of major events (Tabaski, Magal, Gamou, end of year...).

- The sale of terminals, +0.2 billion XOF, thanks to the policy of popularization of smartphones (wider range and positive impact of the field animations and subsidy).

- The decline in prepaid recharge discounts related to the strengthening of the reloading level via the virtual channel (Seddo, Orange Money) with lower commissioning.

- The decrease in voice and text messages, as a result of the collapse of average prices impacted by the significant level of free gifts (abundance). This trend is however mitigated by the strengthening of bundle offers such as the unlimited and the Wotel offer of Kirene with Orange (the Wotel 100F was suspended in September by the ARTP).

- Internet and data activity (+3 billion XOF) thanks to the development of ADSL Internet activity with the general public (Home, home+ ...) and business offers; leased Internet links but also thanks to the growth of Fiber and Flybox offerings. The data and integration business is also growing, particularly on pabx sales and cabling, and despite the competitors’ strong offensive on maintenance services.

- The international activity, which contributes 9.3% of turnover, generates a turnover of 43.2 billion XOF. It recorded a decrease of 33% compared to 2017 linked to the continued decline of the international inbound down by -42%, following the development of alternative routes (including OTT and Simbox off net). This downward trend is mitigated by the contribution of the corridors with an improvement in volumes despite a dilution effect on prices. Hubbing shows a decline with a drop in volume partially offset by prices.

- Other wholesale revenues (leased lines and roaming operator) are decreasing, with a turnover of 12.8 billion XOF. The decrease is mainly due to roaming in mainly linked to credit note accruals.

133 - National interconnection revenues amount to 9.9 billion XOF, down -31% from 2017 following the retroactive fall in the price (from 9XOF to 6XOF) and which absorbs the positive volume effect coming from third-party operators (abundance proposed by competitors).

- The fixed business, which accounts for 6.1% of Senegal’s turnover, is down 4% compared to 2017 due to the continued decline in voice revenues despite the 5.9% increase around packaged voice and internet offerings (ADSL, Flybox and Fiber) and moderated by growth in other fixed revenues (impacted by integration).

3.1.4 Investments

In 2018, Senegal’s investments are 84.7 billion XOF, including 71 billion on the network. The 2018 achievements focused mainly on network expansion and densification projects, particularly on the mobile access network, fiber and transmission.

Network: Continuation of expansion and densification programmes for the mobile access network, in particular on:

1. The Mosaic project (network modernization), 2. 2G/3G expansion and densification to improve urban QoS and rural coverage, 3. The reception of 4G/LTE sites, 4. FTTH rollout, 5. The IP network extension in the regions, 6. The start of work on the submarine cable to cope with the growth of broadband traffic and ensure better security.

IT : Investments consisting mainly of receptions on CRM projects, upgrade to Huawei, Oracle, development costs on big data, SI FTTH integration, TTM and IN projects, expertise on the integration of FMS projects.

Autres : Acquisition of vehicles, final statement for the construction of Sonatel Headquarters and other building/land developments, Rufisque data center.

3.1.5 Mobile ARPU evolution

The global annual mobile ARPU amounts to 38,764, an increase of +8.7% thanks to the sustained revenue growth (+14% over one year) around mobile data and Orange uses to compensate for the drop in revenues from the international inbound market while the base grew only 4%.

134 Sonatel Annual Report 2018

3.2 MALI

Networks 2G - 3G - 4G Market share

5

56% -4,5-4.5 pts

+13,3%/annuel

Maintaining strong commercial positions in volume and value. Strong improvement of 3G coverage. Deployment of THD with LTE (4G, TDD) and fiber solutions. Strengthening of the tax burden. Growth in sales impacted by the change in Orange Money accounting method.

3.2.1 Highlights 2018

1. Security context still tense in North Mali, re-election of outgoing President, establishment of new Government; 2. Favorable economic situation; 3. 4G+ launch with more than 16 sites covered at the end of December 2018; 4. Launch of the FTTX; 5. Launch of LTE/TDD; Pay TV; M Agri; E Health; 6. Generalization of the SEWA bundles (cross-net + SMS + data) bundles helped preserve growth on the departure voice; 7. Good control of expenses, especially commercial ones, which saw a drop of -22.0% in annual (optimization of commissions); 8. Lower interconnection rates; 9. Implementation since February 2018 of new sustainable development funds (0.5% of turnover); 10. 1% increase in the Universal Service fee; 11. 4G launched in November by the competitor; 12. New competitor offers to strengthen the customer base; 13. Starting business of the new entrant TELECEL; 14. Flat rates by competitors.

135 3.2.2 Evolution of the main operational elements in 2018

Base The mobile base recorded a decrease of 16.5% compared to 2017 and stood at 10.5 million customers in connection with the cessation of activation bonuses and the dropping of SIMs during the first half of 2018. The activation bonus was however restarted during Q4, allowing a resumption of customer recruitment.

Traffic The national inbound is up +54.0% compared to 2017 due to the permanence of the cross-net bonuses introduced by the competition as well as package offers launched by all the telephone operators.

International inbound grew by 1.4% over the year, driven by the introduction of corridor offers and their consolidation throughout the year.

The national outbound is up 19.7% anually, This is explained by Sewa offers as well as permanent bonuses during the period. The international outbound is down -2.6% from the negative impact of OTTs.

Number of Staff The workforce at the end of December 2018 is 649, an increase of +40 employees compared to 2017.

3.2.3 Financial elements

Turnover The turnover for the year 2018 is 357.3 billion XOF, an income growth of +0.6%. Growth is driven mainly by mobile and the Internet.

Mobile business whose turnover amounts to 269.3 billion XOF, representing a growth of 2% compared to 2017, is driven by mobile data and Orange Money:

Mobile data accounts for 16.7% of revenues. The growth in 2018 is 36.4%, which is explained by an explosion of usages and special offer packages and Sewa bundles but also by a greater coverage of 3G as well as 4G.

Orange Money is down 5.7% due to the change of accounting method. With a comparable accounting method, Orange Money revenue increased by 14% compared to 2017. Orange Money is one of the growth drivers, thanks to various service offerings and partnerships with the country’s financial institutions.

Internet revenues amounted to 14.8 billion XOF, up 2.7% thanks to 4G offers. Internet accounts for 4.1% of 2018 revenues.

136 Sonatel Annual Report 2018

These favorable developments are mainly mitigated by: 1. Inbound International: with a 2018 revenue of 56.7 billion, business continues to decrease by -3.7%, due to the strong penetration of OTTs; nevertheless, this decrease is mitigated by the launch of the corridor offers.

2. IN roaming revenues: down 26.4%, due to the security context in Mali and OTTs. Domestic interconnection is down 3.5% despite strong volume growth of 54% due to the fall in interconnection rates, which is signified by the AMRTP.

3.2.4 Investments

The 2018 investments amount to XOF 57.2 billion, mainly related to: 1. Network modernization (Mosaic), 2. Densification and extension of 2G&3G networks and investments on the 4G network, 3. The extension of the IN Charging Platform, 4. The rollout of FO with WDM technology, 5. Stabilization of network availability (NUR).

The overall growth of investments is +13.3% compared to 2017, more than 80% of which concern the network.

3.2.5 ARPUS

Mali: ARPU growth driven mainly by income stability in the face of a sharp decline of the base (preservation of the recharge base and value).

137 3.3 GUINEA

Networks 2G - 3G Market share

+1.1 pts

Consolidation of strong commercial positions. Development of the Orange Money business. Important issues around the availability of resources (frequencies, numbers) and the finalization of the negotiations on licenses (concession, 4G). Significant change in financial results.

3.3.1 Highlights 2018

1. Several political events (communal elections, appointment of new Prime Minis- ter) and social events (multiple events) caused disturbances throughout the year; 2. Continued negotiations with the regulator for 4G and allocation of 3rd carrier for the 3G to allow the improvement of the data traffic flow capacities, and also the 4G frequencies; 3. Publication of the results of quality audits of voice and data services in Guinea by ARPT: Orange Guinée maintains its leadership with the best network quality (voice and data) in Conakry, in the different localities and roads; 4. Strengthened leadership with a market share volume of 63.3% and a value of 67.7% (publication ARPT Q3, September 2018); 5. Development of the Orange Money offer with the launch of the IRT service with France (reception); 6. Commissioning of 200 new sites and coverage of 51 new locations; 7. Cessation the business of the INTERCEL operator; 8. Launch of Mobile Money services by SGBG and TOTAL; 9. Launch of the «Solar Energy» project; 10. Good operational and commercial performance despite the acceleration of abundance offers among competitors (300% unlimited); 11. Decrease in the Orange Money commission rate since 1st July 2018; 12. 46% increase in electricity rates for companies.

138 Sonatel Annual Report 2018

3.3.2 Evolution of the main operational elements in 2018

Base The mobile network: 7.27 million subscribers at the end of December 2018, an increase of 485,000 subscribers (+7.2%). This growth can be explained by the expansion and densification of the network and the commercial actions that accompany it (broadening of the 3G terminal range, Friday special refill...). The mobile data base: 2.39 million subscribers compared to 1,963 subscribers in 2017, an increase of +22%, mainly due to the increase in the smartphone rate in the network (+4.2 pts) and the densification of 2G zones into 2G/3G. The Orange Money base: 1.17 million active subscribers at the end of 2018, representing a growth of +300,000 subscribers (+35%). This change is due to the growing awareness of the products and services offered, as well as the continued strengthening of the distribution network (rollout of kiosks throughout the country).

Traffic National outbound traffic: Domestic outbound traffic is up with an increase of +1,392 million minutes. This increase is driven to 98% by On-net (growth of the base, and the effects of marketing and CBM).

International: International outbound traffic increases by 19% (corridor effect and free roaming).

Inbound National Traffic: Inbound traffic has dropped (less generosity among competitors).

International: international inbound traffic is down (strong use of OTT and effect of Sim box).

Number of Staff The workforce of Guinea is 399 employees in 2018 against 379 employees in 2017, an increase of +5.3%.

3.3.3 Financial elements

Turnover The turnover amounts to 191.8 billion CFAF, an increase of 18.7% compared to 2017. On a comparable base growth of +14.9% or 23.6 billion CFAF. Revenue growth favorably impacted by currency effects is driven by:

- Mobile voice and VAS, which account for 63.7% of turnover, grew by 17.9 billion CFAF, mainly driven by marketing and CBM actions supported by the quality of the network.

- Mobile data, which accounts for 14% of revenue, thanks to increased sales of 3G-compatible terminals, marketing actions and the recruitment of new customers by covering 2G zones in 2G/3G.

139 - Orange Money accounts for 6% of revenue driven by growth in the portfolio and the increase in the number of transactions favoured by marketing actions, as well as customer confidence in the service.

- Internet growth of 0.4 billion XOF on Internet leased lines.

- International interconnection and roaming in are down 1.9 billion XOF compared to 2017 following the fall in volumes impact OTT and Sim box, effects related to free roaming.

3.3.4 Investments

In 2018, investments amounted to XOF 33.5 billion, an increase of 22.6% (+19.3% excluding currency impact). This growth was mainly driven by:

1. The Mobile Network (2G/3G), 2. Platform renewal, license extension, upgrade, ... 3. Site construction with the acquisition of 213 Pylons, 4. The deployment of fiber optic: connection of 42 sites, 10 B2B customers and 1 agency, 5. Acquisition of land for headquarters and agency development.

3.3.5 Mobile ARPU evolution

A significant increase in ARPU 2018 in XOF of 16% compared to 2017 due to the significant revenue growth (+24% over one year) driven by the data, Orange Money and the VAS while the base increased only 7%.

140 Sonatel Annual Report 2018

3.4 GUINEA BISSAU

Networks 2G - 3G - 4G Market share

+0.4 pts

Maintaining strong commercial positions in volume and value. Continued deployment of 4G coverage and Orange Money penetration. Orange’s participation in Guinea Bissau’s major connection project to the ACE submarine cable. Financial results impacted by the economic gloom.

3.4.1 Highlights 2018

1. Stable political situation with the appointment of a consensus Prime Minister under the leadership of ECOWAS in February 2018 with the main mandate of organizing the legislative elections. With two postponements, in February and November 2018, the new date remains uncertain. 2. Bad marketing campaign of the cashew nut because of a disagreement on the price at the level of the market (the President of the Republic fixed the producer price at 1 000 CFAF whereas the international price was 350 CHF). As a result, more than 40% of the local production remained unsold. 3. Payment of 7.8 billion to the State for taxes and duties representing 3.9% of the general state budget, an increase of 300 million compared to 2017. 4. The regulator informed the operators of the ECOWAS regulation on the removal of roaming charges and the abolition of all surcharges between ECOWAS countries (project not yet implemented). 5. As part of the Mosaic project, Orange realized: - The extension of 12 2G sites to 3G in the regions; - The extension of 5 4G sites in Bissau and the major cities, 10 new 2G/3G/4G sites remain to be installed in the 2018 rollout programme. 6. Strong growth of the Orange Money active pool (x5 in annual) and data usage favoured by the extension of the network coverage. 7. QoS improvement: Securing international voice and Internet bandwidth (data and fixed). 8. Increasingly aggressive competition with 1000% bonus offers.

141 9. Preservation of value: the decrease in 2018 observed was contained thanks to actions to develop new offers and services, the distribution network and the Data but also by strengthening the value proposition and the reputation of Orange Money.

3.4.2 Evolution of the main operational remains

Base The number of mobile customers made up exclusively of prepaid formats increased by 5.6% compared with 7.7% in 2017. This growth is driven by the strong momentum of recruitment in mobile data offerings, particularly with 4G. The Data base with 129,440 customers experienced a strong growth +41,5% compared to December 2017, in connection with the numerous commercial actions carried out.

Wimax base, however, is down -16.7% from 2017. This drop is mainly due to the migration of home/business customers to 3G+ (Flybox 3G) justifying the quadrupling of the base on this offer.

Traffic Global mobile voice traffic (inbbound and outbound) is growing (+11.7% over a year).

The volume of outbound traffic increased by 13.7% compared to 2017. This growth is mainly due to the on-net traffic, which grew by 15.8%, driven by the increase in the base thanks to commercial events in Bissau and in the regions, and bonus promotions each week.

International mobile outbound traffic decreased by 16.6%, explained by the OTT effect.

Overall inbound traffic was down -20.8% from 2017, mainly due to fiber optic and OTT interruptions.

Number of Staff Decrease of -3.3% (-2 staff), ie a workforce at the end of 2018 of 89 staff.

3.4.3 Financial elements

Turnover

The turnover of Orange Bissau 2018 is 23 billion XOF francs, down 0.5% compared to 2017, mainly due to the decline of the international inbound despite the growth of the mobile business.

The revenue contribution of the wholesale sector is declining due to international inbound traffic, despite an increase in volumes related to Corridor offers and commercial events. This decrease is slightly mitigated by operator roaming.

142 Sonatel Annual Report 2018

The turnover of the mobile business is 17.8 billion or 77.4% of Orange Bissau’s revenues. This activity grew by 4% compared to 2017, mainly due to the increase in data usage based on the increase in penetration following the strengthening and extension of network coverage, the improvement of network quality and the continuation of commercial actions. Voice, VAS and Orange Money also contribute to mobile revenue growth.

3.4.4 Investments

Orange Bissau’s investments in 2018 amounted to 5.2 billion XOF (+12.8% compared to 2017) and helped consolidate its leadership thanks to:

1. The continuation of the development and modernization efforts of the Network (swap of the Alcatel network by Nokia and extension of the 3G/4G network), 2. Securing the North loop in the event of an FO cutoff, 3. The FH rescue upgrade via Ziguinchor, 4. The opening of the FO Bissau ring, 5. Virtualization and IS backup.

3.4.5 Mobile ARPU evolution

An annual Arpu at 32,414 XOF decreasing (-4.6% over a year) linked to a growth of the subscriber base faster than that of the revenues impacted by the economic gloom, the level of free gifts linked to the explosion of abundance, and by the decline of the international inbound.

143 3.5 SIERRA LEONE

Networks 2G - 3G Market share

+4.5 pts

Maintaining the dynamics of conquest in the region with the opening of new sites Discussions with the regulator (taxes...). Acquisition of the 4G license.

3.5.1 Highlights 2018

1. Democratic transition in Sierra Leone, establishment of a new government; 2. Sustained inflation due to continued depreciation of the SLL against the reference currencies (-11.9% against the USD and -7.3% against the EUR and XOF); 3. Finalization in progress with the new NATCOM authorities of the frequency acquisition process for the operation of 4G; 4. Gain of 4.5 points of market share volume; 5. Sierra Leone Money leader in Mobile Finance with 95% market share; 6. Launch of new offers such as voice and data bundles (with more abundance), launch of hybrid offers for the B2B segment; 7. Continuity in the animation and extension of our distribution network (franchises, presence in rural areas) to develop our base and allow growth on all services; 8. Extension of network coverage with the setting up of new sites, especially in rural areas as part of the RAN projects (coverage of new cities and 2G/3G network densification); 9. Continuing co-location with the new entrant (44 shared sites to date); 10. The two competitors already present launched their 4G in 2018, with aggressive initiatives on their offers and promotions, increased aggression since the arrival of new entrant.

144 Sonatel Annual Report 2018

3.5.2 Evolution of the main operational elements in 2018

Base The mobile base increased by 40.1%, mainly impacted by better network quality (more sites, better coverage).

Traffic Traffic growth of +56% compared to 2017, due to the sharp increase in the recharge base, as well as unlimited voice offers (KOLA) on Sundays.

Effectifs : With 191 staff, the workforce grew by 4.95% compared to 2017.

3.5.3 Financial elements

Turnover The turnover of Orange Sierra Leone amounts to 36.4 billion XOF, up 7.7% from 2017.

Mobile revenues increased by 2.4 billion XOF, mainly on voice and mobile data, in line with the growth of the recharging base (+ 37%) and the volume of outbound traffic. Orange Money continues to grow thanks to the increase in volume and value transactions.

On the other hand, wholesale revenues are down, notably due to Roaming (credit notes 2017), international inbound linked to the decline in traffic. The national interconnection, however, shows growth linked to the growth in volumes received from competitors.

Other income rose by XOF 1.3 billion mainly on colocation with Africell.

145

FINANCIAL 9 STATEMENTS NOTE TO THE READER SCOPE OF CONSOLIDATION

The consolidated financial statements include the accounts of Sonatel and all its subsidiaries directly or indirectly controlled. These subsidiaries are consolidated according to the global integration method. Orange Sierra Leone, which is 50% owned, is fully consolidated in accordance with the terms of the Shareholder Agreement.

Groupement Orange Service has been included in the scope of consolidation by the equity method.

Transactions, balances and reciprocal results between the integrated companies are eliminated. The consolidated financial statements are presented in XOF. The assets, liabilities and income statement items of the non-CFA subsidiaries are translated at the exchange rate prevailing at the end of the period.

The consolidated financial statements of the Group are prepared in accordance with the West African Accounting System SYSCOAHADA.

With the entry into force of the reform of SYSCOAHADA revised as of 1st January 2018, the accounts closed at December 2017 have been restated to comply with the new reform and thus allow the comparability of the two financial years. On the presentation of the financial statements as of 31 December 2018, 2017 is presented in 2 columns: R=2017 real; P=2017 in proforma, that is to say, restated according to the SYSCOAHADA reform. Sonatel Annual Report 2018

CONSOLIDATED FINANCIAL STATEMENTS: Asset

Deprec/ Net Net Net Asset Gross Prov 31/12/18 31/12/17 P 31/12/17 R Immobilized asset Fixed charges 0 0 0 898 Intangible assets 501 831 214 258 287 573 296 394 297 606 Goodwill 73 983 11 919 62 063 72 781 72 781 Other intangible assets 427 848 202 339 225 509 223 612 224 825 Tangible fixed assets 1 844 087 1 137 289 706 798 652 255 652 255 Financial fixed assets 164 282 930 163 352 155 950 155 950 Advances and down payments on Fixed assets 0 0 0 0 0 Deferred taxes 18 741 0 18 741 19 393 19 393 Equity-accounted securities 3 995 0 3 995 0 0 Investments and related receivables 5 686 583 5 103 9 416 9 416 Loans and other financial real estate 135 860 348 135 513 127 141 127 141 Total (I) 2 510 200 1 352 478 1 157 722 1 104 599 1 106 709 Current assets 0 Stocks 14 345 1 188 13 157 14 238 14 236 Accounts receivable and related employment 315 602 30 548 285 054 275 081 243 380 Customers 160 039 30 303 129 735 121 237 120 951 Other receivables 155 564 245 155 319 153 844 122 428

Total (II) 329 948 31 736 298 212 289 319 257 616

Cash-Assets - Total (III) 317 439 0 317 439 231 339 231 339

Total assets 3 157 587 1 384 214 1 773 373 1 625 257 1 595 664

149 CONSOLIDATED FINANCIAL STATEMENTS: Liabilities

Net Net Net Liabilities 31/12/18 31/12/17 P 31/12/17 R Equity Capital 50 000 50 000 50 000 Premiums and consolidated reserves 403 276 407 353 407 353 Conversion gap 819 -3 688 -3 688 Net result (Consolidating company share) 172 467 171 801 172 454 Other equity 0 0 0 Consolidating company share 626 561 625 466 626 119 Minority share 90 865 89 752 89 822 Equity of Total Consolidated Group (A) 717 426 715 218 715 941

Financial debts and related resources 0

Deferred taxes 649 661 661 Borrowings and financial debts 190 053 158 329 158 329 Financial provisions for risks and charges 72 293 61 020 59 694 Total (B) 262 995 220 010 218 685 Total stable capital I = (A + B) 980 421 935 229 934 626 Current liabilities 0 Accounts payable and related accounts 264 233 273 017 273 017 Other debts 304 730 270 056 241 065

Total ( II ) 568 963 543 072 514 082

Cash-Liabilities - Total (III) 223 989 146 956 146 956

Total liabilities 1 773 373 1 625 257 1 595 664

150 Sonatel Annual Report 2018

CONSOLIDATED FINANCIAL STATEMENTS: Income statement

Consolidated Income Statement 31-Dec-18 31/12/2017 P 31/12/2017 R

Turnover 1 021 956 972 905 972 905 Stored production 0 0 0 Fixed production 2 040 4 687 4 687 Other operating income 37 175 21 602 16 800 I - Annual production 1 061 170 999 194 994 393 Consumed purchases 63 338 61 746 61 237 External services and other consumption 416 938 390 339 390 869 II - Annual consumption 480 276 452 085 452 106 Value added of holding 580 895 547 109 542 287 Staff costs 108 417 94 069 93 625 Gross operating surplus 472 477 453 040 448 662 Depreciation and provisions 168 955 161 192 160 593 Provision reversals 8 764 15 088 19 718 Operating profit 312 286 306 936 307 787 Financial products 11 236 10 312 10 312 Financial expenses 24 753 18 962 18 971 Earnings from ordinary activities 298 769 298 285 299 128 EOA result -3 380 -1 662 -1 662 Income before taxes 295 390 296 624 297 467 Taxes payable on results 95 567 93 502 93 622 Deferred taxes 2 474 -1 659 -1 659 Net result of integrated businesses 202 297 201 463 202 186 Share in the net results of companies accounted for using the -46 0 0 equity method Net income of the consolidated group 202 251 201 463 202 186 Minority share 29 784 29 662 29 732 Consolidating company share 172 467 171 801 172 454

151 CONSOLIDATED FINANCIAL STATEMENTS: TAFIRE I

1st Part: DETERMINATION OF THE FINANCIAL BALANCES OF THE 2018 FINANCIAL YEAR GLOBAL SELF-FINANCING CAPACITY (GSFC)

Amount (Mil- Amount (Mil- lions XOF) lions XOF) GOP 470,137 (SA) Financial expenses 16 976 (TT) Transfer of operating expenses 2 340 (SC) Foreign exchange loss 5 880 (SL) EOA Expenses 320 (AU) Financial Income 5 531 (EU) Transfer of financial charges 1 (SQ) Participation 0 (UC) Foreign exchange gains 5 329 (SR) Income tax 95 567 (UL) EOA products 1 875 (UN) EOA transfer of expenses 0 Total (I) 118 743 Total (II) 485 214 GSFC: Total (II) - Total (I) 366 471

Self-financing (Af)

Dividends distributed in the year 195,404

AF = GSFC - Dist Div in the exo. 171,067

Change in the working capital requirement (WCR)

C WCR = Var Stocks + Var Claims + Var Current Debts Uses Resources Change in stocks N - (N-1) (increase +) (decrease -) (BC) Goods 0 0 (BD) Raw materials and other suppl. 0 1 103 (BE) In progress 0 0 (BF) Manufactured products 0 0 (A) Var. overall net of inventories 0 1 103

152 Sonatel Annual Report 2018

CONSOLIDATED FINANCIAL STATEMENTS: TAFIRE I (Ctd)

Uses Resources Variation of receivables (increase +) (decrease -) Suppliers, advances paid 5 718 0 Customers 0 55 666 Other receivables 60 352 0 Conversion gap-LIABILITY 0 1 583 TOTAL 66 070 57 248 (B) Overall Net Change in Receivables 8 821 0

Uses Resources Variation of debts (Decrease +) (Increase -) Customers, advances received 0 589 Trade suppliers 63 445 0 Tax debts 0 32 526 Social debts 3 108 0 Other debts 0 66 739 Liabilities Translation differences 36 0 Provisioned risks 171 0 TOTAL 66 761 99 854 (C) Net total change in current liabilities 0 33 094 Variation of WCR = A + B- C 0 25 375

Operating cash surplus (OCS) OCS = GOP - Var. WCR - Fixed production

2018 2017 GOP 470 137 448 662 - Variation of the WCR 25 375 16 943 - Fixed production -2 040 -4 687 ETA 493 473 460 919

153 CONSOLIDATED FINANCIAL STATEMENTS: TAFIRE II

Financial year Financial year 2018 2017 Uses Resources U -; R + I- Investments and Divestments Fixed Expenses (Increases in the year) 0 0

Internal growth

Acquisitions / Disposals of intangible assets 22 042 0 -187 002 Acquisitions / Disposals of intangible assets 195 562 7 784 -176 612

Internal growth

Acquisitions / Disposals of financial fixed assets 24 835 21 430 -4 416 Total Investment 213 225 0 -368 031 II- Change in the working capital requirement (WCR) 0 25 375 16 943 A- Economic Uses To finance FF + FG 187 850 0 -351 087 III- Jobs / Resources (BF, EOA) 8 365 0 35 414 IV - Financial jobs forced repayment (according to 12 510 -25 388 schedule) of loans and financial debts B- Total Uses to Finance 208 725 0 -341 061 V- Internal financing

Dividends (Jobs) / GSFC (Resources) 195 404 366 471 159 534 VI- Equity financing Capital increase by new contributions 2 322 7 700

Investment subsidy 0 0

Capital levy 0 0

154 Sonatel Annual Report 2018

CONSOLIDATED FINANCIAL STATEMENTS: TAFIRE II (Ctd)

Finan- Finan- cial year cial year 2018 2017 Uses Resources U -; R +

VII- Financing with new loans

Borrowings 0 44 403 206 198

Other financial debts 0 0 -1

C - Net funding resources 0 217 792 373 430

D - Surplus or Insufficient Funding Resource (C - B) 0 9 067 32 369

VIII - Change in cash Net cash

At the end of the financial year + or - 93 450 0 -84 383

At the beginning of the financial year + or - 84 383 0 -52 014

Cash flow variation (+ if job - if resource) 9 067 0 -32 369

Resources Control (from the main items of the balance sheet N and N-1) Jobs 31/12/18 31/12/18

Variation in working capital (WC): WC (N) - FDR (N-1) 5 990 0

- Variation of the WCR BFG (N) - BFG (N-1) 0 15 057

Change in cash position (T): T (N) - T (N-1) 9 067 0

TOTAL 15 057 15 057

155 CONSOLIDATED FINANCIAL STATEMENTS: Table of change in equity position (in million XOF)

Share capital Other Items Initial Issuance of shares Trans- Final balance Diffe- Contri- Incor- fers balance before rence bu- Contri- pora- in- De- between after Dis- Distribu- De- conver- tions butions tion of crease crease accounts tribution tion crease sion in in cash re- if we kind serves Capital 50 000 -2 385 2 385 50 000 Issuance premiums, 3 320 69 3 388 merger, contribution Revaluation -3 689 4 507 819 gap Legal 22 709 106 222 23 036 reserve Statuto- ry and 0 0 contractual reserves Other re- 462 063 -4 486 1 338 1 747 460 662 serves Carried -20 648 0 -3 -2 079 -22 730 forward Result previous exercise 0 0 pending allocation Result of the 202 186 202 251 -195 404 -6 782 202 251 finalcial year Investment 0 0 grants

Regulated 0 0 provisions

TOTAL 715 941 0 0 0 0 202 251 -199 890 -876 0 717 426

156 Sonatel Annual Report 2018

CONSOLIDATED FINANCIAL STATEMENTS: Table of variations and details of consolidated debts (in million XOF)

Net Ba- Real Balances Incorpo- Debts Repay- conver- Other lances Security beginning ration incurred ments sion move- end given in financial into diffe- ments financial guarantee year capital (2) (3) rences (6) year for the (1) (4) (5) (7) debts Convertible bonds Other bonds Loans and debts Cre- 156 492 43 185 14 775 51 184 954 dit institutions Borrowings and 1 837 3 329 57 -10 0 5 099 miscellaneous financial TOTAL 158 329 46 514 14 832 0 41 0 190 053

STATEMENT OF FINANCIAL COMMITMENTS

Commitments Given (1) Recieved (1) Warranty commitments Assorted with real security 743 Other warranty commitments 6 047 5 082 Reciprocal commitments In leasing Firm orders

A) Commitments received B) Commitments given 2018 2017 2018 2017 - Supplier guarantees 5 082 2 843 Term account blocked for AFD Dakar 94 300 - Rent guarantees 0 0 Erricson Deposit for Orange Guinea 1 400 700 - Pledge of staff actions 743 843 Customs credit guarantee 4 647 1 007 - Mortgage received 0 0 Bid bond 0 795 Orange Guinea Rent deposits 5 826 3 685 Guaranteed Bond for State Certificate of Financial Capacity 5 400 6 047 8 202

157 CONSOLIDATED FINANCIAL STATEMENTS: Turnover breakdown table (in million XOF)

Financial year 2018 Financial year 2017

Total Sales % of turnover Total Sales % of turnover

A) Breakdown of sales by activities

Fixed 28 854 2.82% 30 202 3.10% Mobile including data 733 481 71.77% 670 788 68.95% Orange Money 62 793 6.14% 46 149 4.74% Fixed Internet 43 560 4.26% 39 979 4.11% National interconnection 29 943 2.93% 34 427 3.54% International interconnection 97 357 9.53% 124 580 12.80% Other wholesale (LL, Roaming, Operators) 10 762 1.05% 13 124 1.35% Data and integration 11 593 1.13% 11 219 1.15% Other income 3 613 0.35% 2 437 0.25%

Total 1 021 956 100% 972 905 100%

B) Distribution of sales by geographical area

Africa (UEMOA) 723 106 70.76% 693 550 71.29% Africa (outside UEMOA) 214 448 20.98% 162 101 16.66% Asia 2 051 0.20% 2 025 0.21% America 1 092 0.11% 1 779 0.18% Europe 81 258 7.95% 113 450 11.66%

TOTAL 1 021 956 100 % 972 905 100 %

158 Sonatel Annual Report 2018

CONSOLIDATED FINANCIAL STATEMENTS: Analysis of the Group’s workforce by major categories at 31 December (in million XOF)

Financial year 2018 Financial year 2017

Number of Staff Payroll Number of Staff Payroll

Salaried Staff 3 133 101 194 3 035 87 715

Managers and senior managers 1 587 61 870 1 473 50 201

Middle managers 1 046 28 044 1 022 26 982

Foremen 381 9 105 476 9 577

Employees and workers 119 2 175 64 955

Temporary staff 1 483 7 223 1 309 5 910

TOTAUX 4 616 108 418 4 344 93 625

159 ALL AMOUNTS ARE EXPRESSED IN MILLION XOF UNLESS OTHERWISE STATED Sonatel Annual Report 2018

1 CAPITAL EXPENSES

2018 2017 0 898

They correspond to acquisition costs of property, plant and equipment and financial assets. With the SYSCOHADA Reform, they were transferred to the transitional account 475100 and then spread over the expenditure accounts by nature of origin.

2 INTANGIBLE ASSETS

Gross Deprec. Net 2018 Net 2017 - Software licenses, patents and trademarks 424 756 -202 917 221 839 221 747 - Goodwill 3 092 578 3 670 3 077 - Consolidation goodwill fund 73 983 -11 919 62 063 72 781 501 831 -214 258 287 573 297 606

This item mainly consists of operating licenses for the fixed and mobile telecom networks; operating licenses for software, patents and trademarks, as well as the business assets of Sonatel Mobiles, SBS and Orange Guinée.

The increase is the result of the acquisition of licenses and software by Sonatel, Sonatel Mobiles and Orange Mali entities.

Goodwill of 73,983 million corresponds to the difference between the acquisition price of the Orange Sierra Leone subsidiary and our share in the capital of the subsidiary. In gross value, it was revised downwards to 6.389 million, corresponding to the discount on the purchase price received from Bharti.

161 3 FIXED ASSETS

Gross Deprec. Net 2018 Net 2017 - Land and development works 8 045 -19 8 026 6 506 - Buildings and installations 90 462 -72 853 17 609 18 974 - Operating equipment: switching, transmission lines and 1 630 299 -978 560 651 739 605 881 networks, energy - Office furniture and equipment 87 211 -66 985 20 226 13 091 - Transportation equipment 28 070 -18 871 9 199 7 803 1 844 087 -1 137 289 706 798 652 255

The increase between 2017 and 2018 on fixed assets is explained by the strengthening of investment programmes which led to the evolution of the following items (in net):

- Land and development works: +1,520 million, - Buildings and installations: -1.365 million, - Transmission: +46.702 million, - Switching: +2,417 million, - Data networks: -1.367 million, - Energy: +5,016 million, - Lines and networks: -17 million, - Miscellaneous: -6,893 million, - Transport equipment: +1.396 million, - Office equipment and furniture: +7.135 million.

ADVANCES & PAYMENTS ON 4 FIXED ASSETS

2018 2017 0 0

Advances and down payments correspond to the amounts paid to suppliers at the start of work.

162 Sonatel Annual Report 2018

5 FINANCIAL ASSETS

Gross Deprec Net 2018 Net 2017 - Non-consolidated securities 5 686 -583 5 103 9 416 - Equity-accounted securities 3 995 0 3 995 - Staff loans 127 377 -347 127 031 123 404 - GOP loan 2 0 2 0 - Obligations 16 0 16 688 - Deposits and guarantees paid 8 466 -1 8 465 3 048 - Deferred taxes - Assets 18 741 0 18 741 19 393 164 282 -930 163 352 155 950

The change in non-consolidated securities (see detail in point 6 - Non-consolidated securities) is mainly due to the consolidation of GOP (Orange Services Group).

The employee loans item includes loans granted to employees.

The decline in bonds is explained by the repayment of coupons matured on State of Senegal bonds.

The increase in deposits and securities of 5,417 million is mainly related to the guarantee bonds deposited with Huawei by Orange Mali on the project of outsourcing the maintenance of the network (1,960 million); and those paid by Orange Guinea to Total (fuel supply) and IPT Powertech Guinea SA (ESCO project) for a total amount of 2.742 million.

Deferred taxes - assets are generated by temporary differences between accounting and tax results.

163 6 NON-CONSOLIDATED SECURITIES

Gross Deprec. Net 2018 Net 2017 - SCGB SA 3 0 3 0 - AMC (OSL) 1 0 1 0 - Horizons Canal 5 0 5 5 - Rascom 794 0 794 794 - Ico 533 -533 0 0 - Technopole 8 0 8 8 - Young Africa 100 -50 50 50 - Orange Services Group 0 0 0 4 420 - Guilab 3 785 0 3 785 3 681 - Teranga Capital 446 0 446 446 - GIM UEMOA 12 0 12 12 5 686 -583 5 103 9 416

7 NET STOCKS

Gross Deprec. Net 2018 Net 2017 14 345 -1 188 13 157 14 236

Gross inventories essentially consist of: - fuel: 8 million - supplies of lines and networks: 3,322 million - subscriber terminals: 4.866 million - phone cards: 2.651 million - peritelephony: 1.106 million - Internet thumbdrives: 226 million - office supplies: 132 million - stocks in transit: 2,040 million

The decrease is due on the one hand to the destocking of terminals (-1.584 million), phone cards (-763 million) and peritelephony (-200 million); on the other hand the storage of line and network supplies (+655 million) and inventory in transit (+840 million).

Dead stocks (disqualified), dormant (without movements during one year) and defective stocks are depreciated at 100%.

164 Sonatel Annual Report 2018

8 NET ACCOUNTS RECEIVABLE

Gross Deprec. Net 2018 Net 2017 - Private customer receivables 53 643 -27 156 26 487 34 562 - State customer receivables 10 958 0 10 958 13 196 - Operators customer receivables 67 500 -3 148 64 352 43 542 - Services to bill 27 938 0 27 938 29 652 160 039 -30 303 129 735 120 951

The decrease in private receivables is mainly related to the improvement of the recovery.

The decline in claims on the state of Senegal continues with the government’s plan to reduce its telephone bill.

The increase in trade receivables from operators is mainly due to collection problems on the TIGO, EXPRESSO and HAYO operators in Senegal.

The services to be invoiced concern the billing in December or the fourth quarter of 2018 for mobile and fixed telephony, the Internet, professional solutions, hubbing, roaming, national and international interconnection.

Bad debts are provisioned at 100% according to seniority: - fixed private customers of more than 6 months, - mobile customers over 90 days old, - operators (Africa, Latin America and Asia) over 12 months and on a case-by-case basis for other country

These receivables are definitively written off after 5 years, except for operators who are subject to the discretion of the portfolio managers.

165 9 OTHER NET CLAIMS

Gross Deprec. Net 2018 Net 2017 - Advances and down payments to suppliers 10 701 0 10 701 5 472 - Advances and down payments to staff 600 -53 547 685 - State taxes and debts 86 416 0 86 416 75 297 - Current accounts Group companies 1 658 0 1 658 5 966 - Various debtors 53 662 -192 53 470 32 379 - Accruals - Assets (translation adjustment) 2 528 0 2 528 2 629 155 564 -245 155 319 122 428

The increase in advances and down payments to suppliers is explained by the recognition of credit notes with international operators by entities Sonatel Mobiles (2.963 million), Orange Guinea (1.363 million), supplier advances in OSL (8.931 million), as well as an advance of 1,168 paid by Sonatel to Main One as part of a submarine cable project.

The sharp rise in taxes is mainly due to the CT and IRVM advances paid in the various countries of presence and the tax credits.

The decline in current accounts of the Group’s companies is explained by Orange SA’s settlement of a former Sonatel receivable.

The increase in other receivables of 21,091 million is mainly due to the acquisition of shares to be distributed to staff in Senegal (+1,865 million), the increase in CSM receivables (+1,417 million) due to the rejection of the payments in favor of Sonatel because of banking details problems being resolved, the transitional account related to the SYSCOHADA reform (1.706 million), netting operators in OSL (8.945 million), as well as DTAs.

NB : foreign currency receivables are valued at the closing rate.

166 Sonatel Annual Report 2018

10 NET CASH ASSETS

2018 2017 - Banks 218 856 157 578 - UV Orange Money in circulation 88 780 66 286 - Cash 1 216 534 - Financial institutions 5 465 3 386 - Investment securities 3 123 3 556 317 439 231 339

Bank cash increased by 61,091 million.

The Orange Money money supply in circulation is growing because of the development of the offer and the creation of electronic money to meet the demand.

The increase in the open balance with financial institutions results from the outsourcing of the recovery of roaming through the clearing house.

The decline in investment securities is explained by the evolution of the equity portfolio of the Market Facilitation Mechanism.

167 11 SHAREHOLDERS’ EQUITY

2018 2017 - Capital 50 000 50 000 - Unavailable Reserves 23 037 22 710 - Miscellaneous reservations 412 178 413 579 - Regulated reserves 48 484 48 484 - Contribution, issue and merger premium 3 387 3 319 - Conversion difference 819 -3 688 - Brought forward -22 730 -20 648 - Result from the consolidating company 172 467 172 454 - Minority share 29 784 29 732 717 426 715 941

The unavailable reserves correspond to the legal reserve capped at 20% of the share capital of each company.

The various reserves are free reserves endowed annually when the results are allocated.

The regulated reserves concern only the provision for the renewal of tools and equipment.

The translation difference is related to the impact of the conversion of opening equity into the currency of Orange Guinea (Guinean franc) and Orange Sierra Leone (Leone).

The balance of the retained earnings account corresponds to the deficit results of Orange Finances Mobiles Senegal and Orange Sierra Leone.

Overall, the change in shareholders’ equity between 2017 and 2018 can be explained by the allocation of profit in reserves and the distribution of non-Group dividends for 195,404 million.

FINANCIAL DEBTS 12 AND SIMILAR RESOURCES

2018 2017 - Deferred Taxes Liabilities 649 661

Deferred taxes - liabilities are generated by the tax adjustment of the capital gain to be reinvested on the sale of buildings.

168 Sonatel Annual Report 2018

13 BORROWINGS AND FINANCIAL DEBTS

2018 2017 - Bank loans 185 506 152 043 - Security deposits 1 912 1 837 - Accrued interest 2 634 4 449 190 053 158 329

The increase in bank loans can be explained by the subscription of new financing in Mali (+45 billion), Sierra Leone (Orange share) and the repayments made by Sonatel in the amount of 14,745 million.

Security deposits are payments made by customers as a consumption advance when subscribing.

PROVISIONS FOR RISKS 14 AND CHARGES

2018 2017 - Provisions for litigation 9 989 3 270 - Risk provisions 3 635 4 232 - Retirement provisions 20 915 18 517 - Provisions for other expenses 37 754 33 674 72 293 59 694

The increase in provisions for risks and charges is explained by: - the provision for tax risk at Sonatel; - the change in the calculation method of the pension provision following the SYSCOHADA reform which recommends the valuation of retirement commitments according to the actuarial method. An actuarial firm supported Sonatel Group entities in this process; - provision for the staggering of the acquisition cost of free shares allocated to the staff.

169 SUPPLIERS AND RELATED 15 ACCOUNTS

2018 2017 - Trade suppliers 199 630 199 801 - Investment Providers 64 603 73 216 264 233 273 017

Supplier debts fell overall as a result of work to make the systems more reliable, particularly in Senegal, with the conversion of unconfirmed old balances into revenue.

NB : The contractual duration of the supplier credit is on average 60 days after receipt of the invoice.

16 OTHER DEBTS

2018 2017 - Social debts 11 869 14 942 - Tax debts 149 720 116 618 - Current accounts 3 127 1 460 - Accounts payable 7 886 7 269 - Sundry creditors 131 880 100 500 - Account Regularization liability (conversion difference) 249 277 304 730 241 065

The decrease in social debts of 3.073 million is mainly due to the full payment of the performance bonus in December, unlike in previous years where only installments were paid.

Tax debts rise by 33,102 million, explained by the combined effect of the following events: - the increase in personal income tax +2,208 million, - the increase of the CIT by 29.969 million following the good results achieved by most entities, - the increase of the TCT in Guinea (+3.033) and the CST in Senegal (+1.189 - 1% increase of the rate.

The increase in current accounts is mainly due to the balance of the Orange SA account in Sierra Leone.

The increase in sundry creditors is due to the credit balances of Orange Money due to the issuance of electronic money and netting operators in OSL.

170 Sonatel Annual Report 2018

17 CASH FLOW LIABILITY

2018 2017 - Banks 223 989 146 956

The increase in bank credit balances of 77,032 million is explained by the use of spot credits.

18 TURNOVER

The turnover breaks down as follows:

2018 2017 Variation - Fixed 28 854 30 202 -4.5% - Mobile including data 733 481 670 788 9.3% - Orange Money 62 793 46 149 36.1% - Fixed Internet 43 560 39 979 9.0% - National interconnection 29 943 34 427 -13.0% - International interconnection 97 357 124 580 -21.9% - Other wholesale (LL, Roaming, Operators) 10 762 13 124 -18.0% - Data and integration 11 593 11 219 3.3% - Other income 3 613 2 434 48.4% 1 021 956 972 902 5.0%

Consolidated sales increased by 5% due to:

- the 4.5% decline in fixed telephony due to the continued decline of the business; - Mobile’s 9.3% growth thanks to the maintenance of strong commercial positions, usage development (Data, SVA); - the strong growth of the Orange Money business by 36.1%; a true growth driver, it makes it possible to compensate for the loss on voice and text messages; - the growth of fixed Internet by 9% thanks to the revitalization of Internet offers; - the decrease of the national interconnection by 13% favored by the retroactive fall of prices in Senegal and Mali; - the 21.9% decline in international interconnection caused by the drop in volume of inbound international calls with the development of OTTs; - the decline in other wholesale products by 18%, mainly due to the Roaming operator in Senegal and in Sierra Leone, and LL in Senegal; - the integration increase of 3.3%; - the increase in other income by 48.4%.

171 The following figures highlight the contribution of each subsidiary to the achievement of the turnover and gross operating surplus.

Contributory revenue by company breaks down as follows:

2018 2017 - Orange Mali 321 616 347 307 - Sonatel Mobiles 313 031 291 053 - Sonatel SA 90 174 108 336 - Orange Guinea 170 061 147 851 - Orange Bissau 20 381 20 095 - Sonatel Multimedia 9 299 8 634 - Sonatel Business Solutions 907 800 - Orange Finances Mobiles Senegal 21 104 9 279 - Orange Finances Mobiles Mali 27 924 0 - Orange Finances Mobiles Guinea 11 419 5 728 - Orange Sierra Leone 34 227 33 822 - Orange Money Sierra Leone 1 813 0 1 021 956 972 905

172 Sonatel Annual Report 2018

19 CONSUMPTION

The consumption of the financial year is as follows:

2018 2017 Variation - Purchasing 61 094 59 122 3% - Transport 2 244 2 114 6% - Field Services 345 745 335 081 3% - Duties and taxes 46 093 39 746 16% - Miscellaneous 25 099 16 042 56% 480 276 452 106 6%

The increase in purchases is mainly due to the increase in fuel and electricity consumption of the technical sites in Guinea, Mali and Senegal to a lesser extent. Terminal purchases have increased in Senegal to support the development of fiber optics, as well as the popularization of data usage; same for modems (Livebox, Flybox). A decrease in the purchase of recharge cards was noted in Senegal, Mali and Guinea due to the development of e-recharge. The development of the integration offer also lead to increased purchases of line and network supplies.

The slight increase in transportation costs is related to travel on missions.

The change in foreign services declined in relative terms (+11% in 2017 and +3% in 2018). The significant variations that explain the rise are: - increased outsourcing and maintenance of networks following the outsourcing of certain activities: ANO fees in Mali, ANO and GNOC fees in Guinea, and the rollout of fiber in Senegal, - the increase in commercial expenses, particularly those related to Orange Money (commissions on transactions and turnover-indexed sales commissions), - the decrease in international payments with the decrease in volumes and rates of incoming international traffic, due to the development of OTTs, - lower satellite rental costs thanks to the optimization of bandwidth charges, - VAS payments to SMS+ partners and service platforms increase following the development of value-added services and the growth of data, - increased caretaking and security costs, particularly in Mali with the payment for site security due to the transfer of ANO to Huawei, - the increase in fees paid to computer experts, - the increase in other fees pegged to the turnover, in particular the management fees paid to Orange, the brand fees.

The increase in taxes and duties is mainly due to the increase in the following expenses pegged to turnover: TARTOP in Mali, TARTEL in Guinea and CST in Senegal (rate increase of 1%); this despite the gain made in Senegal on the deductibility of VAT on OFMS.

The increase in miscellaneous charges is mainly due to the depreciation of parastatal customers and the claim on the CSU operator in Senegal.

173 20 OTHER CHARGES

2018 2017 Variation - Staff costs 108 417 93 625 16% - Depreciation and provisions 168 955 160 593 5% - Financial expenses 24 753 18 971 30% - EOA charges excluding CIT 13 084 19 168 -32% 315 210 292 357 8%

The increase in staff costs comes mainly from Senegal and is due to the three-year wage increase, the retirement and early retirement allowances. At the same time, the special end-of-career bonus paid for the acquisition of free shares for the exits from function exits has increased, as well as the performance bonus and the holiday provisions calculated on the payroll.

Depreciation and amortization are increasing in all countries of presence. They are explained by the sustained level of investments in recent years to support the growth of data and meet the quality of service requirements of the States.

The increase in provisions is explained by the change in the valuation method of the pension provision with the SYSCOHADA reform (actuarial method), the provision for tax risk in Senegal, mitigated by the provision for fidelity premium (impact of the regulatory effect on PE shares in 2017).

Financial expenses increased by 5.782 million due to the bank loan taken out in Mali, loans granted by Orange SA to OSL and recourse by Sonatel to spot credits.

EOA expenses decreased by 6,084 million because of the strong increase observed in 2017.

21 OTHER INCOME

2018 2017 Variation - Other operating income 37 175 16 800 121% - Reversals on provisions 8 764 19 718 -56% - Capitaized production 2 040 4 687 -56% - Financial products 11 236 10 312 9% - EOA products 9 659 17 507 -45% 68 874 69 024 0%

The increase in other operating income is due to various adjustments made during the year, and the effect of the drop in 2017.

Provision reversals correspond to the cancellation of provisions that have become immaterial. The decrease is due to their high level in 2017.

174 Sonatel Annual Report 2018

The fall in capitalized production is explained by the stopping of the systematic capitalization of expenses related to IT projects.

Financial products result from financial investments.

The decrease in EOA revenues is mainly due to the decrease in disposals of fixed assets.

OFF BALANCE SHEET 22 COMMITMENTS

In 2018, the Group received and gave the off-balance sheet commitments detailed below: a) Commitments received

2018 2017 - Supplier guarantees 5 082 2 843 - Pledge of staff shares 743 843 5 826 3 686 b) Commitments given

2018 2017 - Term account blocked for AFD Dakar 94 0 300 - Customs credit guarantee 1 400 700 - Bid bond 4 647 1 007 - Deposit on irrevocable rental agreement 0 795 - Certificate of financial capacity 0 5 400 6 047 8 202

REMUNERATION OF SENIOUR 23 MANAGERS

The total compensation of the 10 highest paid employees in 2018 amounts to: 2.197 million.

24 EVENTS AFTER CLOSURE

N/A

175 FINANCIAL STATEMENTS SONATEL SA (XOF EXCEPT OTHERWISE STATED) Sonatel Annual Report 2018

Financial Statements Sonatel SA: Income statement

Net 2017 Item Note Net 2018 Net 2017 PROFORMA Sale of goods 21 0 0 0

Purchases of goods 22 0 0 0

Variations in stock of goods 6 0 0 0

COMMERCIAL MARGIN (Sum TA to RB) 0 0 0

Sale of manufactured products 21 0 0 0

Works, services sold 21 231 822 191 077 289 366 493 266 289 366 493 266

Accessories 21 33 244 719 645 32 506 658 891 32 506 658 891

TURNOVER (A + B-C + D) 265 066 910 722 321 873 152 157 321 873 152 157

Stored production (or destocking) 6 0 0 0

Capitalized production 21 1 249 313 738 2 552 687 032 2 552 687 032

Operating subsidies 21 0 0 0

Others products 21 12 802 157 862 6 405 191 900 6 405 191 900

Transfers of operating expenses 12 2 931 630 514 2 661 431 993 2 661 431 993

Purchases of raw materials and related supplies 22 0 0 0 Variations in stocks of raw materials and related 6 0 0 0 supplies Other purchases 22 12 131 606 007 10 617 528 132 11 013 184 513

Variations in stocks of other supplies 6 679 518 689 1 131 654 647 1 131 654 647

Transport network 23 1 104 503 443 954 832 116 965 599 079

External Services 24 100 976 372 212 113 420 796 394 116 540 586 519

Duties and taxes 25 8 548 658 737 7 558 708 380 4 092 678 531

Other expenses 26 8 428 788 777 4 964 709 907 4 985 864 556

VALUE ADDED (XB + RA + RB) + sum (TE to TJ) 150 180 564 971 194 844 233 506 194 762 895 237

Staff costs 27 71 637 128 767 63 350 873 101 63 575 983 725

GROSS OPERATING PROFIT (GOP) (XC + RK) 78 78 543 436 204 131 493 360 405 131 186 911 512

Depreciation reversals, provisions and depreciation 28 5 268 330 051 15 374 649 073 15 533 247 946

177 FINANCIAL STATEMENTS SONATEL SA: Income statement (Ctd)

Net 2017 Item Note Net 2018 Net 2017 PROFORMA Depreciation and amortization, charges and 3C 50 349 847 457 41 646 344 894 41 560 269 642 provisions Operating profit (XD + TJ + RL) 33 461 918 798 105 221 664 584 105 159 889 816

Financial and similar income 29 97 222 071 884 98 741 383 615 98 741 383 615

Reversals of provisions and financial depreciation 28 348 179 329 353 022 450 353 022 450

Transfers of financial charges 12 0 140 140

Financial costs and related expenses 29 11 731 095 271 9 122 516 745 9 122 516 745 Provisions for provisions and financial deprecia- 30 1 665 017 910 356 746 366 348 179 329 tion Financial income (sum TK to RN) 84 174 138 032 89 615 143 094 89 623 710 131

Income from Ordinary Activities 117 636 056 830 194 836 807 678 194 783 599 947

Proceeds from disposals of fixed assets 3D 261 482 435 75 006 456 75 006 456

Other products EOA 30 39 889 086 189 326 275 189 326 275

Accounting values of disposals of fixed assets 3D 145 050 548 6 268 495 6 268 495

Other expenses EOA 30 196 194 816 10 148 500 10 148 500

Income excluding Ordinary Activities -39 873 843 247 915 736 247 915 736

Workers’ participation 30 0 0 0

Income taxes 10 656 720 271 31 506 101 374 31 506 101 374

Net Income (XG + XH + RQ + RS) 106 939 462 716 163 578 622 040 163 525 414 309

178 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Balance sheet 1

Net 2017 Items Note Gross Deprec Net 2018 Net 2017 PROFORMA Intangible fixed 3 156 948 216 680 49 619 557 638 107 328 659 042 100 933 595 617 100 933 595 617 assets Costs development and 13 384 125 12 775 956 608 169 608 169 608 169 prospecting Patents, licenses, software, and 156 934 832 555 49 606 781 682 107 328 050 873 100 932 987 448 100 932 987 448 similar rights Commercial fund and leasehold 0 0 0 0 0 right Other intangible 0 0 0 0 0 fixed assets Tangible fixed 3 573 745 089 674 442 665 319 104 131 079 770 570 125 615 260 420 125 615 260 420 assets Land posted 3 833 037 965 0 3 833 037 965 3 807 064 975 3 807 064 975 under Net Buildings posted 36 273 868 004 21 506 595 416 14 767 272 588 15 970 722 398 16 897 071 030 under Net General facilities, fixtures and 19 294 256 507 15 360 856 198 3 933 400 309 5 048 209 379 4 121 860 747 fittings materials movables and 497 847 482 014 395 558 884 213 102 288 597 802 95 557 716 075 95 557 716 075 biological assets Transportation 16 496 445 184 10 238 983 278 6 257 461 906 5 231 547 593 5 231 547 593 equipment Advances and down payments 3 0 0 0 0 0 made to assets Financial fixed 4 269 659 913 626 917 032 335 268 742 881 291 263 813 212 053 263 813 212 053 assets

179 FINANCIAL STATEMENTS SONATEL SA: Balance Sheet 1 (Ctd)

Net 2017 Item Note Gross Deprec Net 2018 Net 2017 PROFORMA Equity 177 881 798 295 582 859 425 177 298 938 870 178 741 186 550 178 741 186 550 securities Other financial fixed 91 778 115 331 334 172 910 91 443 942 421 85 072 025 503 85 072 025 503 assets Total Fixed 1 000 353 219 980 493 201 909 077 507 151 310 903 490 362 068 090 490 362 068 090 Assets Current asset 5 0 0 0 0 0 EOA Inventories 6 3 929 984 874 16 593 881 3 913 390 993 2 601 442 691 2 601 442 691 and stocks Receivables and 0 0 0 0 0 similar assets Suppliers and ad- 17 1 459 902 471 0 1 459 902 471 285 821 990 285 821 990 vances

Customers 5 60 871 530 984 11 829 387 714 49 042 143 270 122 458 237 970 122 458 237 970

Other recei- 5 140 617 158 794 244 336 380 140 372 822 414 133 519 814 170 135 273 384 405 vables Total current 206 878 577 123 12 090 317 975 194 788 259 148 258 865 316 821 260 618 887 056 assets Investment 9 3 042 432 392 0 3 042 432 392 2 701 996 317 2 701 996 317 securities Values for 10 29 643 989 0 29 643 989 819 351 819 351 collection Banks, post office che- 11 53 313 289 577 0 53 313 289 577 31 457 825 775 31 457 825 775 ques, cash and similar Total Cash flows of the 56 385 365 958 0 56 385 365 958 34 160 641 443 34 160 641 443 assets Foreign exchange 12 36 633 636 0 36 633 636 8 567 037 8 567 037 asset

General Total 1 263 653 796 697 505 292 227 052 758 361 569 645 784 290 238 959 785 150 163 626

180 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Balance sheet 2

Net 2017 Items Note Net 2018 Net 2017 PROFORMA Capital 13 50 000 000 000 50 000 000 000 50 000 000 000 Contributors uncalled capital (1) 13 0 0 0 Premiums related to share capital 14 0 0 0 Revaluation differences 3E 0 0 0 Non-distributable reserves 14 10 000 000 000 10 000 000 000 10 000 000 000 Free reserves 14 143 436 717 276 146 524 761 903 146 524 761 903 Brought forward (+ or -) 14 0 0 0 Net profit for the year (profit+ or loss-) 106 939 462 716 163 578 622 040 163 525 414 309 Investment subsidy 15 672 860 330 822 297 626 822 297 626 Regulated provisions 15 2 164 571 051 2 204 460 137 2 204 460 137 Total equity and similar resources 313 213 611 373 373 130 141 706 373 076 933 975 Borrowings and miscellaneous financial 16 100 082 816 075 114 816 766 054 114 816 766 054 Debts and capital leases 16 0 0 0 Provisions for risks and charges 16 59 956 180 535 48 570 773 636 49 471 207 782 Total financial debts and Resources 160 038 996 610 163 387 539 690 164 287 973 836 Total stable resources 473 252 607 983 536 517 681 396 537 364 907 811 Current debts EOA 5 7 542 177 892 7 113 688 757 7 113 688 757 Customers, advances received 7 133 894 179 144 471 468 144 471 468 Trade suppliers 17 55 481 676 951 66 076 743 796 66 076 743 796 Social and tax debts 18 34 154 951 303 59 814 844 545 59 818 567 045 Other debts 19 28 553 979 379 28 475 508 190 28 484 483 942 Current debts EOA 5 7 542 177 892 7 113 688 757 7 113 688 757 Customers, advances received 7 133 894 179 144 471 468 144 471 468 Trade suppliers 17 55 481 676 951 66 076 743 796 66 076 743 796 Social and tax debts 18 34 154 951 303 59 814 844 545 59 818 567 045 Other debts 19 28 553 979 379 28 475 508 190 28 484 483 942 Provisions for short-term risks 19 36 633 636 8 567 037 8 567 037 Total current liabilities 125 903 313 340 161 633 823 793 161 646 522 045 0 0 0 Banks, discount and cash credit 20 0 0 0 Banks, financial institutions and cash credit 20 159 205 567 866 86 138 733 770 86 138 733 770 Total cash - liabilities 159 205 567 866 86 138 733 770 86 138 733 770 Translation difference-Asset 12 80 456 0 0 General Total 758 361 569 645 784 290 238 959 785 150 163 626

181 FINANCIAL STATEMENTS SONATEL SA: Cash Flow Statement

Items Note 2018 NET CASH OPENING -51 978 092 327 Cash flow from operating activities Global Self-financing Capacity (GSFC) 153 181 497 730 Variation in current assets EOA (-) 0 Variation in stocks (-) -1 311 948 302 Variation of receivables and similar assets (-) 66 974 932 339 Variation of current liabilities (+) -35 730 429 997 Variation in FN related to operating activities (FB + FC + FD + FE) 29 932 554 040 Cash flow from operating activities 183 114 051 770 Cash flow from investing activities Disbursements related to acquisitions of intangible assets (-) -14 699 233 463 Disbursements related to acquisitions of tangible fixed assets (-) -33 202 130 858 Disbursements related to acquisitions of financial fixed assets (-) -16 419 400 067 Disposal of intangible and tangible fixed assets (+) 261 482 435 Disposal of financial fixed assets (+) 11 503 737 248 Cash flow from investing activities -52 555 544 705 Cash Flow from Equity Financing Capital increase by new contributions 0 Investment subsidies received (+) 0 Capital Levy (-) 0 Dividend distribution (-) -166 666 666 667 Cash Flow from Equity Financing -166 666 666 667 Cash Flow from Foreign Capital Financing Borrowings -1 803 806 115 Other financial debts (+) Repayment of borrowings and other financial debts -12 930 143 864 Cash Flow from Foreign Capital Financing -14 733 949 979 Cash flow from financing -181 400 616 646 VARIATION OF NET CASH -50 842 109 581 Net cash at 31/12/Control: Cash assets N - Cash liabilities N -102 820 201 908

182 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes

Name Note Item Note A N/A

NOTE 1 FULLY COLLATERALIZED DEBTS 1 0 NOTE 2 REQUIRED INFORMATION 1 0 NOTE 3 A GROSS FIXED ASSETS 1 0 NOTE 3 B CAPITAL LEASE 0 1 NOTE 3 C FIXED ASSETS (AMORTIZATION) 1 0 NOTE 3 D FIXED ASSETS (CAPITAL GAIN OR LOSS) 1 0 NOTE 3 E INFORMATION ON THE REVALUATIONS CARRIED OUT BY THE ENTITY 0 1 NOTE 4 FINANCIAL FIXED ASSETS 1 0 NOTE 5 CURRENT ASSET EOA 0 1 NOTE 6 INVENTORIES AND STOCKS BILLABLE 1 0 NOTE 7 CUSTOMERS 1 0 NOTE 8 OTHER CLAIMS 1 0 NOTE 8 A SPREADSHEET OF CAPITALIZED EXPENSES 1 0 NOTE 9 INVESTMENT SECURITIES 1 0 NOTE 10 VALUES FOR COLLECTION 1 0 NOTE 11 BANKS, POSTAL CHEQUES AND CHEQUES 1 0 NOTE 12 TRANSLATION DIFFERENCE 1 0 NOTE 13 CAPITAL 1 0 NOTE 14 PREMIUMS AND RESERVES 1 0 NOTE 15 A TOTAL SUBSIDIES AND REGULATED PROVISIONS 1 0 NOTE 15 B OTHER EQUITY 0 1 NOTE 16 A FINANCIAL DEBTS AND SIMILAR RESOURCES 1 0 NOTE 16 B PENSION COMMITMENTS AND ASSIMILATED BENEFITS (ACTUARIAL METHOD) 1 0 NOTE 16 B bis PENSION COMMITMENTS AND ASSIMILATED BENEFITS 0 1 NOTE 16 C CONTINGENT ASSETS AND LIABILITIES 0 1 NOTE 17 TRADE SUPPLIERS 1 0 NOTE 18 SOCIAL AND TAX DEBTS 1 0 NOTE 19 OTHER DEBTS AND PROVISIONS FOR SHORT-TERM RISKS 1 0 NOTE 20 BANKS, DISCOUNT AND CASH CREDIT 1 0

183 FINANCIAL STATEMENTS SONATEL SA: Notes (Ctd)

Name Note Item Note A N/A

NOTE 21 TURNOVER and OTHER PRODUCTS 1 0 NOTE 22 PURCHASES 1 0 NOTE 23 TRANSPORT 1 0 NOTE 24 EXTERNAL SERVICES 1 0 NOTE 25 DUTIES AND TAXES 1 0 NOTE 26 OTHER EXPENSES 1 0 NOTE 27 A STAFF EXPENSES 1 0 NOTE 27 B EMPLOYEES, WAGE BILL AND EXTERNAL STAFF 1 0 NOTE 28 PROVISIONS AND DEPRECIATION IN THE BALANCE SHEET 1 0 NOTE 29 FINANCIAL INCOME AND EXPENSES 1 0 NOTE 30 OTHER EXPENSES AND PRODUCTS EOA 1 0 BREAKDOWN OF INCOME STATEMENT AND OTHER CHARACTERISTIC ELEMENTS NOTE 31 1 0 OF THE LAST FIVE YEARS NOTE 32 PRODUCTION OF THE ACCOUNTING YEAR 0 1 NOTE 33 PURCHASES FOR PRODUCTION 0 1 NOTE 34 SUMMARY SHEET OF THE MAIN FINANCIAL INDICATORS 1 0 LIST OF SOCIAL, ENVIRONMENTAL AND SOCIETAL INFORMATION TO BE NOTE 35 1 0 PROVIDED

184 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 1: FULLY COLLATERALIZED DEBTS

Goss Items Note Mortgage Collateral Guarantee Amount Financial debts and related resources 0 0 0 0

Convertible bonds 0 0 0 0

Other bonds 0 0 0 0

Loans and debts of credit institutions 0 0 0 0

Other financial debts 0 0 0 0

SUBTOTAL (1) 0 0 0 0

0 0 0 0

Debts and capital leases 0 0 0 0

Real estate lending debts 0 0 0 0

Financial leasing debts 0 0 0 0

Debts on lease-purchase contracts 0 0 0 0

Debts on capital leases 0 0 0 0

SUBTOTAL (2) 0 0 0 0

0 0 0 0

Current liabilities: 0 0 0 0

Accounts payable and related accounts 376 868 270 0 0 0

Customers 0 0 0 0

Staff 0 0 743 467 689 0

Social security and social organizations 0 0 0 0

State 0 0 0 0

International organizations 0 0 0 0

Associates and Group 0 0 0 0

Sundry Group creditors 0 0 0 0

SUBTOTAL (3) 376 868 270 0 743 467 689 0

TOTAL (1) + (2) +(3) 376 868 270 0 743 467 689 0

185 FINANCIAL STATEMENTS SONATEL SA: Notes 1: FULLY COLLATERALIZED DEBTS (Ctd)

Items Note Gross Amount Mortgage Collateral Guarantee

Financial commitments 0 0 0 0

Commitments to related entities 0 0 0 0

Unmatured repayment premiums 0 0 0 0

Endorsements, sureties, guarantees 4 821 189 892 0 0 0

Mortgages, collateral, guarantees, other 0 0 0 0

Unmatured discounted bills 0 0 0 0

Trade and business receivables assigned 0 0 0 0

Contingent claims write-off 0 0 0 0

TOTAL 4 821 189 892 0 0 0

Comments SONATEL has received 376,868,270 in guarantees from its Suppliers. It also has a Pledge of Staff Shares amounting to 743,467,689.

The guarantees given by SONATEL consist of: - Bank guarantees 327,500,779 - Performance Bonds 1,051,307,962 - Customs credit guarantees 700,000,000 - Tax deposits 1,041,158,800 - Rental security deposit 1,401,222,351

186 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 2 : MANDATORY INFORMATION

A - DECLARATION OF CONFORMITY TO SYSCOHADA

The financial statements are prepared in accordance with the OHADA accounting system and the Uniform Act rela- ting to accounting law and financial information.

B - ACCOUNTING RULES AND METHODS

The financial statements have been prepared in accordance with postulates, agreements and valuation rules enacted by SYSCOHADA and the Uniform Act.

C- DEROGATION FROM ACCOUNTING POSTULATES AND CONVENTIONS

Compliance with all the postulates and accounting conventions without any derogation

D - ADDITIONAL INFORMATION RELATING TO THE BALANCE SHEET, THE INCOME STATEMENT AND CASH FLOW

No supplemental information relating to the other financial statements.

Comments The financial statements are prepared in accordance with the revised SYSCOHADA effective as of 1st January 2018.

The financial statements for the year ended 31 December, 2017 have been restated to comply with the new reform to allow the comparability of the two financial years.

The impact of the revised SYSCOHADA on the accounts consists essentially of the valuation of the pension provision using the actuarial method.

On the presentation of the financial statements as of 31 December 2018, 2017 is presented in 2 columns: R=2017 real; P=2017 in proforma, that is to say, restated according to the revised SYSCOAHADA.

187 FINANCIAL STATEMENTS SONATEL SA: Notes 3 A: GROSS FIXED ASSETS

B A B B Following a C C Gross Gross Acquisitions Situation and Transfers revaluation Division Transfers D=amount A + B at-C amount at Contribu- movement from item during the retire- from item the end of opening of tions Crea- to item financial ment to item the finan- the financial tions year cial year Intangible assets 142 123 476 317 14 699 233 463 125 506 900 0 0 0 156 948 216 680 Development and Prospecting 13 384 125 0 0 0 0 0 13 384 125 Costs Patents, li- censes, sof- 142 110 092 192 14 699 233 463 125 506 900 0 0 0 156 934 832 555 tware, and similar rights Funds 0 0 0 0 0 0 0 commercial and 0 0 0 0 0 0 0 leasehold Other 543 766 216 456 33 202 130 858 2 072 144 790 0 3 097 750 740 2 197 651 690 573 515 820 414 intangible fixed 3 807 064 975 25 972 990 0 0 0 0 3 833 037 965 assets

Tangible fixed 0 0 0 0 0 0 0 assets

Land excluding 36 813 289 470 1 711 843 824 0 0 53 613 600 2 197 651 690 36 273 868 004 investment 0 0 0 0 0 0 0 property ( ) 18 506 737 598 483 315 755 443 227 836 0 139 024 682 0 19 294 256 507 Land - Invest- 470 119 590 095 28 243 668 351 1 476 395 810 0 1 992 172 242 0 497 847 482 014 ment property Buildings exclu- ding investment property Buildings - Investment property General facilities, fixtures and fittings Movable mate- rials and biologi- cal assets

188 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 3 A: GROSS FIXED ASSETS (Ctd)

B D = A + B - C A B B Following a C C Gross Situation Gross Acquisitions Transfers revaluation Sale Divi- Transfers amount at and amount at contributions from item during the sion retire- from item the end of movement opening of creations to item financial ment to item the financial financial year year year Transporta- 14 519 534 318 2 737 329 938 152 521 144 0 912 940 216 0 16 496 445 184 tion Advances and down 0 0 0 0 0 0 0 payments on Fixed assets Intangible 0 0 0 0 0 0 0 fixed assets Tangible 0 0 0 0 0 0 0 fixed assets Financial 264 744 250 807 16 419 400 067 0 0 11 503 737 248 0 269 659 913 626 fixed assets Equity secu- 179 324 045 975 -1 442 247 680 0 0 0 0 177 881 798 295 rities Other finan- 85 420 204 832 17 861 647 747 0 0 11 503 737 248 0 91 778 115 331 cial assets General 950 633 943 580 64 320 764 388 2 197 651 690 0 14 601 487 988 2 197 651 690 1 000 123 950 720 Total

Comments The majority of fixed assets consist of the acquisition of power network materials and equipment.

The increase in financial fixed assets is mainly due to the loans granted to Orange Sierre Leone, to the staff.

189 FINANCIAL STATEMENTS SONATEL SA: Notes 3 C: FIXED ASSETS (DEPRECIATION)

C A D = A +B - C B Reductions: Situations and movements Accumulated Cumulative Additions Depreciation depreciation depreciation during relating to Items the opening of at the close of the year items written financial year the year of the assets Development and prospecting costs 12 775 956 0 0 12 775 956 Patents, licenses, software, and similar 41 177 104 744 8 429 676 938 0 49 606 781 682 rights Commercial fund and leasehold right 0 0 0 0

Other intangible assets 0 0 0 0

Subtotal: intangible assets 41 189 880 700 8 429 676 938 0 49 619 557 638

Land excluding investment property 0 0 0 0

Land - Investment property 0 0 0 0

Buildings excluding investment property 19 916 218 440 1 643 990 576 53 613 600 21 506 595 416

Buildings - Investment property 0 0 0 0

General facilities, fixtures and fittings 14 384 876 851 1 115 004 029 139 024 682 15 360 856 198

Movable materials and biological assets 374 561 874 021 22 976 025 907 1 979 015 715 395 558 884 213

Transportation equipment 9 287 986 725 1 732 042 748 781 046 195 10 238 983 278

Subtotal: tangible assets 418 150 956 036 27 467 063 260 2 952 700 192 442 665 319 104

Total General 459 340 836 736 35 896 740 198 2 952 700 192 492 284 876 742

Comments Intangible assets They are amortized over a period of five (5) years. «Dissociated» software (which is the subject of a separate invoicing of IT equipment) are also capitalized and amortized over a period of estimated life of three (3) years; Tangible fixed assets; Construction 20 years; Land development works 40 years; Office and house furniture 10 years; Office equipment 05 years; Fixtures, fittings, facilities 10 years; Transport equipment 05 years; Switching Equipment 10 years; Transmission and Data Equipment 10 years; Lines and Networks Equipment 10 years; Energy Equipment 10 years; Measuring devices 3 years; Other Operating Equipment 10 years.

190 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 3 D: FIXED ASSETS (CAPITAL GAIN OR LOSS)

Net Gross Depreciation Disposal Capital gain Situation and Movements accounting Amount Practical price or loss Items values A B D E= C - D C = A - B Development and prospecting costs 0 0 0 0 0 Patents, licenses, software, and 0 0 0 0 0 similar rights Commercial fund and leasehold right 0 0 0 0 0

Other intangible assets 0 0 0 0 0

Subtotal: Intangible assets 0 0 0 0 0

Land 0 0 0 0 0

Buildings 192 638 282 192 638 282 0 0 0

General facilities, fixtures and fittings 0 0 0 0 0

Movables and biological assets 1 992 172 242 1 979 015 715 13 156 527 32 430 802 19 274 275

Transportation equipment 912 940 216 781 046 195 131 894 021 229 051 633 97 157 612

Subtotal: tangible assets 3 097 750 740 2 952 700 192 145 050 548 261 482 435 116 431 887

Equity securities 0 0 0 0 0

Other financial fixed assets 0 0 0 0 0

Subtotal: fixed financial assets 0 0 0 0 0

GENERAL TOTAL 0 0 0 0 0

Comments Most of the capital gains realized on fixed assets relate to transportation equipment.

191 FINANCIAL STATEMENTS SONATEL SA: Notes 4: FINANCIAL FIXED ASSETS

Recei- Accounts Accounts Varia- vables one receivable receivable Items 2018 2017 tion in year or more than a more than % more year two years

Equity securities 177 881 798 295 179 324 045 975 -0.80 0 0 177 881 798 295

Loans and receivables 4 919 677 500 0 0.00 0 0 0

Staff loan 85 329 700 374 83 665 208 088 1.99 5 281 335 300 1 997 763 058 78 050 602 016

Claim on the state 0 0 0.00 0 0 0

Locked securities 13 120 000 686 870 000 -98.09 0 0 13 120 000

Deposits and Guarantees 1 290 982 154 1 039 509 210 24.19 995 824 197 0 295 157 957

Accrued interest 224 635 303 28 617 534 684.96 40 147 397 0 184 487 906

Gross total 269 659 913 626 264 744 250 807 1.86 6 317 306 894 1 997 763 058 250 227 272 874 Depreciation of equity 582 859 425 582 859 425 0.00 0 0 582 859 425 securities Depreciation other fixed 334 172 910 348 179 329 -4.02 0 0 334 172 910 assets Net total depreciation 268 742 881 291 263 813 212 053 1,87 6 317 306 894 1 997 763 058 249 310 240 539

Comments Effect of repayment of State bonds of Senegal; Rising interest on loans granted to Orange Sierra Leone.

192 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 6: INVENTORIES AND STOCKS BILLABLE

Items 2018 2017 % Variation

Goods 0 0 0.00

Raw materials and related supplies 0 0 0.00

Other supplies 2 898 660 162 2 513 859 908 15.31

Current products 0 0 0.00

Services in progress 0 0 0.00

Finished products 0 0 0.00

Intermediate products 0 0 0.00

Stocks in transit, on consignment or on deposit 1 031 324 712 99 794 055 933.45

Gross total stocks and in progress 3 929 984 874 2 613 653 963 50.36

Inventory Depreciation 16 593 881 12 211 272 35.89

Net depreciation amount 3 913 390 993 2 601 442 691 50.25

Comments Inventories increased by just over 50% due to inventory change en route.

193 FINANCIAL STATEMENTS SONATEL SA: Notes 7: CUSTOMERS

Accounts Accounts receivable recei- Varia- Receivables more than vable Items 2018 2017 tion one year or a year and more in % more two years than two at most years Customers (excluding Group 52 246 889 811 75 737 005 392 -31.02 52 246 889 811 0 0 reservation of ownership) Accounts receivable (excluding Group reservation 0 0 0.00 0 0 0 of ownership) Customers accounts receivable with reservation of 0 0 0.00 0 0 0 ownership Customers-Group 0 0 0.00 0 0 0 receivables Receivables on disposal of 0 0 0.00 0 0 0 capital assets Nonmatured discounted 0 0 0.00 0 0 0 customer bills

Bad or litigious debts 944 267 277 10 071 750 620 -90.62 944 267 277 0 0

Customers receivable 7 680 373 896 46 520 054 351 -83.49 7 680 373 896 0 0

TOTAL GROSS 60 871 530 984 132 328 810 363 -54 60 871 530 984 0 0 CUSTOMERS Depreciation of accounts 11 829 387 714 9 870 572 393 19.85 11 829 387 714 0 0 receivable (491)

Total net depreciation 49 042 143 270 122 458 237 970 -60 49 042 143 270 0 0

Clients, advances received 0 0 0.00 0 0 0 outside the Group (4191) Customers, advances 0 0 0.00 0 0 0 received Group (4192)

Other trade receivables 0 0 0.00 0 0 0

Total creditors 0 0 0 0 0 0

Comments -60% mainly due to the decrease in interconnection for the 2018 financial year.

194 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 8: OTHER CLAIMS

Accounts receivable Accounts Varia- Receivables more than receivable Items 2018 2017 tion one year or a year and more than in % more two years at two years most

Staff 367 302 155 439 363 423 -16.40 367 302 155 0 0

Social organizations 0 0 0.00 0 0 0

State and public authorities 23 025 586 413 33 268 759 823 -30.79 23 025 586 413 0 0

International organizations 0 0 0.00 0 0 0

Contributors, partners and 26 022 057 072 26 184 865 442 -0.62 26 022 057 072 0 0 Group Special adjustment transitional account related 1 316 111 107 0 0.00 477 968 685 477 968 685 360 173 737 to SYCOHADA

Other miscellaneous debtors 89 886 102 047 73 872 818 326 21.68 89 886 102 047 0 0

Unblocked permanent accounts of institutions and 0 0 0.00 0 0 0 subsidiaries Liaison accounts for product 0 0 0.00 0 0 0 expenses Liaison accounts of joint 0 0 0.00 0 0 0 ventures

Gross total other receivables 140 617 158 794 133 765 807 014 5 139 779 016 372 477 968 685 360 173 737

Depreciation of other 244 336 380 245 992 844 -0.01 244 336 380 0 0 receivables

Net impairment amount 140 372 822 414 133 519 814 170 5 138 586 390 837 477 968 685 360 173 737

Comments Other miscellaneous receivables and Contributors, partners and Group concerns Intergroup services.

195 FINANCIAL STATEMENTS SONATEL SA: Notes 8 A: SPREAD SHEET OF FIXED ASSET EXPENSES

Cost of Expenses to be Item Provision for Retirement Establishment distributed Overall amount to be spread 0 595763712 720347395 out 1st January Length of spread 0 3 5

614 300 7 320 560 Account 1 Amount

631 800 269 437 398 691 115 180 086 829

632 710 10 903 554

item 632 800 36 000

638 420 3 175 280

638 440 6 929 100

638 460 79 964

Comments Detail of the spread of 4,751 with respect to the expenses to be apportioned and the reassessment of the pension.

196 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 9: INVESTMENT SECURITIES

Items 2018 2017 % Variation

Treasury securities and short-term cash certificates 0 0 0.00

stock 3 042 432 392 2 701 996 317 12.60

Obligations 0 0 0.00

Subscription warrants 0 0 0.00

Marketable securities outside regions 0 0 0.00

Accrued interest 0 0 0.00

Other similar values 0 0 0.00

Total gross securities 3 042 432 392 2 701 996 317 12.60

Depreciation of securities 0 0 0.00

Net depreciation amount 3 042 432 392 2 701 996 317 12.59

Comments +12.59% more animation on the securities in 2018.

197 FINANCIAL STATEMENTS SONATEL SA: Notes 10: VALUES FOR COLLECTION

Items 2018 2017 % Variation

Bill for collection 0 0 0.00

Bills sent for collection 0 0 0.00

Checks to cash 1 025 158 513 350 99.70

Checks sent for collection 23 046 699 0 0.00

Credit cards to cash 3 422 544 78 001 4 287.82

Other values to cash 2 149 588 228 000 842.80

Gross total cash values 29 643 989 819 351 3 517.98

Depreciation of values to cash 0 0 0.00

Net depreciation amount 29 643 989 819 351 3 517.98

198 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 11: BANKS, CHEQUES POSTAL AND CHEQUES

Items 2018 2017 % Variation

Local banks 29 150 698 384 20 159 434 159 44.60

Banks other states region 0 0 0.00

Banks, term deposit 0 0 0.00

Other banks 22 209 716 577 10 017 958 697 121.70

Banks accrued interest 323 988 350 348 448 808 -7.02

Postal cheques 108 023 389 137 638 531 -21.52

Other financial institutions 1 415 788 937 693 836 702 104.05

Financial institutions accrued interest 0 0 0.00

Treasury instruments 0 0 0.00

Cash 105 073 940 100 508 878 4.54

Mobile electronic cash register 0 0 0.00

Imprest and credit transfers 0 0 0.00

Gross liquid assets 53 313 289 577 31 457 825 775 69.48

Depreciation 0 0 0.00

Total net of depreciation 53 313 289 577 31 457 825 775 69.48

Comments The variation in cash is due to larger bank credit balances in 2018. The date of the bank reconciliations on 31/12/2018. The fund was inventoried on 27/12/2018.

199 FINANCIAL STATEMENTS SONATEL SA: Notes 12 : gap in accounting conversion

UML Rate Rate Variation Curren- Currency Items Year UML absolute cies amount acquisition 31/12 value Asset translation differences: itemize the recei- 190332472,3 vables and debts concerned XDR 169 876 803 800 -550 431

CUSTOMERS USD 2 416 224 564 576 28 500 799

XDR 153 729 751 800 7 582 406 Liabilities Translation differences: detail the receivables and debts concerned CUSTOMERS USD 330 399 576 576 80 456

Items 2018 2017 % Variation

Transfers of operating expenses: detail the nature of the 2 931 630 514 2 661 431 993 10% expensesto to be transferred

Transfers of financial charges: detail the nature of the 0 140 -100% charges to be transferred

200 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 13: Capital

Nature of shares Disposal or Surname and first or partnership Nationality Number Total amount repayments in name units (ordinary or financial year preferences) Francetelecom / FCR French 0 2 116 667 21 166 670 000 0

State of Senegal Senegalese 0 1 357 816 13 578 155 000 0

General public 0 1 121 574 11 215 740 000 0

Employees 0 403 944 4 039 435 000 0

201 FINANCIAL STATEMENTS SONATEL SA: Notes 14: PREMIUMS AND RESERVES

Items 2018 2017 Absolute Value Variation Share premium 0 0 0 Issuance premiums 0 0 0 Merger premium 0 0 0 Conversion premium 0 0 0 Other premiums 0 0 0 Total premiums 0 0 0 Legal reserves 10 000 000 000 10 000 000 000 0 Statutory Reserves 0 0 0 Net long-term capital gains reserves 0 0 0 Reserve of free allocation of shares to salaried 0 0 0 staff and managers Other regulated reserves 0 0 0 Total unavailable reserves 10 000 000 000 10 000 000 000 0,00 Free reserves 143 436 717 276 146 524 761 903 -3 088 044 627 Carried forward 0 0 0 Share premium 0 0 0 Issuance premiums 0 0 0 Merger premium 0 0 0 Conversion premium 0 0 0 Other premiums 0 0 0 Total premiums 0 0 0 Legal reserves 0 0 0 Statutory Reserves 0 0 0 Net long-term capital gains reserves 0 0 0 Reserve of free allocation of shares to salaried 0 0 0 staff and managers Other regulated reserves 0 0 0 Net long-term capital gains reserves 0 0 0 Reserve of free allocation of shares to salaried 0 0 0 staff and managers Other regulated reserves 0 0 0 Total unavailable reserves 0 0 0.00 Free reserves 0 0 0.00 Carried forward 0 0 0.00 Comments -3 billion: a deduction from its reserves for the purposes of distributing dividends under 2017 fiscal year. 202The OGM that led to the change in reserves was held on 17/04/2018. Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 15 A: TOTAL SUBSIDIES AND REGULATED PROVISIONS

Variation % Tax Items NOTE 2018 2017 value Deadline Variation system absolute State 0 0 0 0.00

Regions 0 0 0 0.00

Departments 0 0 0 0.00 Communes and decentralized public 0 0 0 0.00 authorities Public or mixed entities 0 0 0 0.00 Entities and private 672 860 330 822 297 626 -149 437 296 -18.17 organizations International organizations 0 0 0 0.00

Other 0 0 0 0,00

Total grants 672 860 330 822 297 626.00 -149 437 296 -18.17

Accelerated depreciation 0 0 0 0.00

Capital gain on sale to invest 2 164 571 051 2 204 460 137 -39 889 086 -1.81 Special provision for 0 0 0 0.00 revaluation Regulated Provisions for 0 0 0 0.00 Fixed Assets Regulated provisions for 0 0 0 0.00 inventories Provisions for investment 0 0 0 0.00 Other provisions and 0 0 0 0.00 regulated funds Total Provisions 2 164 571 051 2 204 460 137.00 39 889 086 -1.81 regulated Total subsidy and regulated 2 837 431 381 3 026 757 763.00 189 326 382 -6.26 provisions

Comments Impact of depreciation over the period.

203 FINANCIAL STATEMENTS SONATEL SA: Notes 16 A: FINANCIAL DEBTS AND SIMILAR RESOURCES

Debts over Variation Varia- Debts to one year Debts to Items 2018 2017 value tion a year or and up to more than absolute in % more two years at two years the most Borrowings 0 0 0 0.00 0 0 0 bonds (161) Loans and debts with credit 97 319 295 756 110 236 581 473 -12 917 285 717 -11.72 26 533 405 812 29 083 825 755 41 702 064 189 institutions (162) Advances received from the State 0 0 0 0.00 0 0 0 (163) Advances received and blocked current 0 0 0 0.00 0 0 0 accounts (164) Deposits and bonds 129 050 436 131 078 012 -2 027 576 -1.55 0 0 129 050 436 received (165) Accrued interest 2 634 469 883 4 449 106 569 -1 814 636 686 -40.79 2 634 469 883 0 0 (166) Advances with special conditions 0 0 0 0.00 0 0 0 (167) Other loans and 0 0 0 0.00 0 0 0 debts (168) Debts related to 0 0 0 0.00 0 0 0 investments (181) Permanent locked accounts of es- 0 0 0 0.00 0 0 0 tablishments and branches (184) Total loans and 100 082 816 075 114 816 766 054 -14 733 949 979.00 -13 29 167 875 695 29 083 825 755.00 41 831 114 625 financial debts Real estate leasing 0 0 0 0.00 0 0 0 (172) Financial leasing 0 0 0 0.00 0 0 0 (173) Hire pur- 0 0 0 0.00 0 0 0 chase(1764) Accrued interest 0 0 0 0.00 0 0 0 (176) Other debts rent 0 0 0 0.00 0 0 0 - Acquisition (178)

204 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 16 A: FINANCIAL DEBTS AND SIMILAR RESOURCES (Ctd)

Debts over Debts Debts to Variation Varia- one year to a more Items 2018 2017 value tion and up to year or than absolute in % two years at more two years the most Total lease 0 0 0.00 0 0 0.00 0 purchase debts Provision for 43 264 054 457 32 737 204 782 10 526 849 675 32.16 0 0 0 litigation (191) Provision for gua- rantee given to the 0 0 0 0.00 0 0 0 customer (192) Provision for loss on future completion 0 0 0 0.00 0 0 0 market (193) Provision for foreign 0 0 0 0.00 0 0 0 exchange loss (194) Provision for taxes 0 0 0 0.00 0 0 0 (195) Provision for pen- sions and similar 16 692 126 078 15 833 568 854 858 557 224 5.42 0 0 0 obligations (1961) Active retirement 0 0 0 0.00 0 0 0 plan (1962) Provision for res- 0 0 0 0.00 0 0 0 tructuring (197) Provision for fines 0 0 0 0.00 0 0 0 and penalties (1981) Provision for own 0 0 0 0.00 0 0 0 insurer (1983) Provision for dismantling and 0 0 0 0.00 0 0 0 reclamation (1984) Provision for deduction rights 0 0 0 0.00 0 0 0 (1985) Other provisions 0 0 0 0.00 0 0 0 (1988) Total provisions for 59 956 180 535 48 570 773 636 11 385 406 899.00 23 0 0.00 0 risks and charges

Comments Borrowings and financial debts (14 billion): impact of repayments on CMT loans of 110 billion, repayment of the last annuity of the AFD Loan. Provisions for litigation and for risk +11 billion is mainly due to the AGA provision and the revaluation of the pension provision according to the actuarial method.

205 FINANCIAL STATEMENTS SONATEL SA: Notes 16 B: COMMITMENTS RETIREMENT AND SIMILAR BENEFITS (ACTUARIAL METHOD)

Items NOTE 2018 2017 Rate of salary increase 0 0 0 Probability of being present in the entity as of the date of retirement 99.923 0 0 (past experience) Inflation rate 1.5 0 0 Probability of being alive at retirement age (death table-0 lite) 0 0 0 Effective rate of return on plan assets 6.5 0 0 Entities and private organizations 672 860 330 822 297 626 International organizations 0 0 Other 0 0 Total grants 672 860 330 822 297 626.00 Accelerated depreciation 0 0

Items NOTE 2018 2017

Obligation under retirement commitments at opening 16 734 003 000 0 0 Benefits paid during the year 961 926 000 0 Financial cost 1 330 845 000 0 Actuarial losses / (gain) 1 178 559 000 0 Benefits paid during the year -3 513 207 000 0 Cost of past services 0 0 Obligation on retirement commitments at closing 0 0

Items Increase Decrease Increase Decrease Discount rate (% variation) 0 0 0 0 Rate of progression of wages (variation of ....%) 3.4 0 0 0 Staff departure rate (% change) 0 0 0 0

Comments Probability of being present in the entity at the date of retirement (past experience) is calculated from the turnover rate. For the life table: the CIMAF table, defined in article 334-4 of the Insurance Code of the CIMA Member States for Life Insurance, which is the regulatory table for our zone, was used.

206 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 17: TRADE SUPPLIERS

Debts Debts over one Variation Varia- Debts to over year and Items 2018 2017 absolute tion one year or two up to two value in % more year years at years the most Suppliers accounts payable (outside 16 437 426 345 18 698 520 126 -2 261 093 781 -12.09 16 437 426 345 0 0 Group) Suppliers bills payable (outside 0 0 0 0.00 0 0 0 Group) Group suppliers accounts and bills 7 918 335 768 4 044 140 413 3 874 195 355 95.80 7 918 335 768 0 0 payable Suppliers, current 0 0 0 0.00 0 0 0 capital acquisitions Suppliers invoices 11 615 769 494 19 614 715 688 -7 998 946 194 -40.78 11 615 769 494 0 0 not received Group Suppliers invoices not received (out- 19 510 145 344 23 719 367 569 -4 209 222 225 -17.75 19 510 145 344 0 0 side Group)

Total suppliers 55 481 676 951 66 076 743 796 -10 595 066 845.00 -16 55 481 676 951 0.00 0

Provider Advances and down payments 1 246 909 698 72 829 217 1 174 080 481 1 612.10 1 246 909 698 0 0 (outside Group) Suppliers Advances and Down pay- 0 0 0 0.00 0 0 0 ments Group Other debtors 212 992 773 212 992 773 0 0.00 212 992 773 0 0 suppliers Total debtors 1 459 902 471 285 821 990 1 174 080 481,00 411 1 459 902 471 0.00 0 suppliers

Comments Decrease in trade payables and unreceived invoices over the 2018 period and advance to suppliers.

207 FINANCIAL STATEMENTS SONATEL SA: Notes 18: TAX AND SOCIAL DEBTS

Debts over Debts Varia- one year Variation ab- Debts to a over Items 2018 2017 tion and up solute value year or more two in % to two years years at the most Staff advances and 0 0 0 0.00 0 0 0 down payments Staff remunerations 3 106 438 7 270 316 -4 163 878 -57.27 3 106 438 0 0 due Other staff 8 007 197 912 9 749 907 743 -1 742 709 831 -17.87 8 007 197 912 0 0 Social Security 9 485 933 8 918 537 567 396 6.36 9 485 933 0 0 Fund Pension fund 178 566 867 168 591 390 9 975 477 5.92 178 566 867 0 0 Other social 290 069 292 290 067 004 2 288 0.00 290 069 292 0 0 organizations Total social debts 8 488 426 442 10 224 754 990 -1 736 328 548.00 -17 8 488 426 442 0.00 0 State, income tax 10 873 526 421 31 761 469 367 -20 887 942 946 -65.77 10 873 526 421 0 0 on profits State duties and 392 772 746 291 723 843 101 048 903 34.64 392 772 746 0 0 taxes State, VAT 5 260 044 349 9 786 332 695 -4 526 288 346 -46.25 5 260 044 349 0 0 State taxes with- 4 602 285 040 3 192 410 130 1 409 874 910 44.16 4 602 285 040 0 0 held at source Other debts State 4 537 896 305 4 558 153 520 -20 257 215 -0.44 4 537 896 305 0 0 Total tax debts 25 666 524 861 49 590 089 555 -23 923 564 694.00 -48 25 666 524 861 0.00 0 Total social and 34 154 951 303 59 814 844 545 -25 659 893 242.00 -43 0 0.00 0 fiscal debts

Comments CIT variation due mainly to the decrease in interconnection rates for the 2018 financial year. Revalorization of wages over the period.

VAT debtor payable due to the decrease in the interconnection rate recorded over the period.

208 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Notes 19: OTHER DEBTS PROVISIONS FOR SHORT TERM RISKS

Debts Debts Debts more than Variation Varia- more one one year Items 2018 2017 absolute tion than year or and two value in % two more years at years most International 0 0 0 0.00 0 0 0 organisations (45) Contributor, Capital 0 0 0 0.00 0 0 0 Transactions (461) Partners, current account 0 0 0 0.00 0 0 0 (462) Partner dividends to pay 2 155 018 693 1 391 511 160 763 507 533 54.87 0 0 0 (465) Group, current accounts 13 758 514 948 15 057 984 116 -1 299 469 168 -8.63 0 0 0 (466) Other associated debts 0 0 0 0.00 0 0 0 Total associated debts 15 913 533 641 16 449 495 276 -535 961 635.00 0 0 0.00 0 Miscellaneous accounts 12 335 758 561 11 749 314 956 586 443 605 4.99 0 0 0 payable (4712) Bondholders (4713) 0 0 0 0.00 0 0 0 Remuneration of 0 0 0 0.00 0 0 0 directors (4715) Factor Account (4716) 0 0 0 0.00 0 0 0 Contribution merger 0 0 0 0.00 0 0 0 account Warrants and bonds 0 0 0 0.00 0 0 0 Remaining payments to be made on non-paid up 281 791 510 247 956 371 33 835 139 13.65 0 0 0 securities (472) Intermediate transactions 0 0 0 0.00 0 0 0 on behalf of a third party Periodic expense 22 895 667 28 741 586 -5 845 919 -20.34 0 0 0 distribution account Special adjustment transitional account 0 0 0 0.00 0 0 0 related to the revision of SYSCOHADA (475) Prepaid income 0 0 0 0.00 0 0 0 Other miscellaneous 80 456 0 80 456 0.00 0 0 0 creditors Total miscellaneous 12 640 526 194 12 026 012 913 614 513 281.00 5 0 0.00 0 creditors

209 FINANCIAL STATEMENTS SONATEL SA: Notes 19: OTHER DEBTS AND PROVISIONS FOR SHORT TERM RISKS (Ctd)

Debts over Debts Variation Varia- Debts to one year more Items 2018 2017 absolute tion one year or and up to than value in % more two years at two the most years Unblocked permanent accounts of institutions and 0 0 0 0.00 0 0 0 subsidiaries Liaison accounts income and 0 0 0 0.00 0 0 0 expenditure (186,187) Liaison accounts of joint 0 0 0 0.00 0 0 0 ventures (188)

Total liaison accounts 0 0 0 0.00 0 0 0

Provisions for short-term 36 633 636 8 567 037 28 066 599 0.00 0 0 0 risks (see note 28)

Comments There is a decline in social debts with a stagnation of the amount of sundry debts and an increase in short-term provisions over the period.

210 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 20: BANKS, CREDIT DISCOUNT AND CASH

Items 2018 2017 % Variation

Campaign credit discount 0 0 0.00 Ordinary credit discount 0 0 0.00 Total: Banks, discount and cash credit 0 0 0.00 Local banks 32 186 326 616 11 005 077 520 192.47 Banks other states region 0 0 0.00 Other banks 0 0 0.00 Banks accrued interest 2 019 241 250 0 0.00 Cash credit 125 000 000 000 75 133 656 250 66.37 Total: Banks, cash credit 159 205 567 866 86 138 733 770 84.82 General Total 159 205 567 866 86 138 733 770 84.82

Comments +82% attributable to the importance of short-term financing.

211 FINANCIAL STATEMENTS SONATEL SA: Note 21: TURNOVER AND OTHER REVENUE

Items 2018 2017 % Variation Sales in the region 0 0 0.00 Sales outside the region 0 0 0.00 Group Sales 0 0 0.00 Internet sales 0 0 0.00 Total: Sale of goods 0 0 0% Sales in the region 0 0 0.00 Sales outside the region 0 0 0.00 Group Sales 0 0 0.00 Internet sales 0 0 0.00 Total: Sales of manufactured products 0 0 0% Sales in the region 120 666 165 932 142 136 359 033 -15.11 Sales outside the region 1 530 194 2 801 816 -45.39 Group Sales 24 074 133 984 30 627 740 728 -21.40 Internet sales 87 080 360 967 116 599 591 689 -25.32 Total: Sales of works and services sold 231 822 191 077 289 366 493 266 -19.89 Accessories 33 244 719 645 32 506 658 891 2.27 Total: Turnover 265 066 910 722 321 873 152 157 -17.65 Fixed production 1 249 313 738 2 552 687 032 -51.06 Operating subsidy 0 0 0.00 Other products 12 802 157 862 6 405 191 900 99.87 Total other products 14 051 471 600 8 957 878 932 56.86 Total 279 118 382 322 272 721 416 360 2.35

Comments +2% despite the withdrawal of international inbound, fixed voice and whosales FIXED 28 404 631 640 MOBILE 236 680 INTERNET 16 289 953 030 WHOLESALE ACTIVITY 148 866 374 135 DATA AND INTERNET 8 574 010 958 OTHER INCOME 62 931 704 279

212 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 22: PURCHASES

Items 2018 2017 % Variation Purchases in the region 0 0 0.00 Purchases outside the region 0 0 0.00 Group Purchasing 0 0 0.00 Total: goods purchases 0 0 0.00 Purchases in the region 0 0 0.00 Purchases outside the region 0 0 0.00 Group Purchasing 0 0 0.00 Total: purchases of raw materials and related supplies 0 0 0.00 Consumables 0 0 0.00 Combustible material 1 685 415 786 1 582 612 940 6.50 Cleaning products 0 0 0.00 Workshop, Plant and store supplies (6044) 5 715 237 256 4 752 278 144 20.26 Water 200 981 877 180 888 694 11.11 Electricity 3 984 777 683 3 734 879 073 6.69 Other energies 0 0 0.00 Maintenance supply 355 531 054 289 174 784 22.95 Office supply 0 0 0.00 Small equipment and tools 182 060 256 74 696 165 143.73 Purchases study, services provision, materials works 7 602 095 2 998 332 153.54 and equipment Packaging purchases 0 0 0.00 Purchase costs 0 0 0.00 Discounts and rebates 0 0 0.00 Total: other purchases 12 131 606 007 10 617 528 132 14.26

Comments +14% of purchases largely related to workshop, plant and store supplies.

213 FINANCIAL STATEMENTS SONATEL SA: Note 23: TRANSPORT

Items 2018 2017 % Variation

Transportation on sales 0 0 0.00 Transportation on behalf of others 0 0 0.00 Staff transportation 718 065 090 552 709 480 29.92 Transport of mail 385 221 768 400 997 103 -3.93 Other Transport 1 216 585 1 125 533 8.09 TOTAL 1 104 503 443 954 832 116 15.68

Comments There is an increase of 15.67 in transportation costs.

214 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 24: EXTERNAL SERVICES

Items 2018 2017 % Variation

General subcontracting 10 612 882 776 9 434 449 077 12.49 Rental and rental charges 1 226 327 416 751 110 340 63.27 Acquisition Lease Charges 0 0 0.00 Upkeep, repairs and maintenance 7 887 794 104 6 966 063 057 13.23 Insurance premium 751 468 373 1 230 974 417 -38.95 Studies, research and documentation 27 431 941 27 013 307 1.55 Advertising, publications, public relations 1 911 665 651 1 820 267 085 5.02 Telecommunications costs 44 862 744 930 54 854 611 624 -18.22 Bank charges 2 272 309 867 678 112 672 235.09 Remuneration of intermediaries and advisers 9 214 590 863 9 084 787 592 1.43 Staff training costs 1 335 266 535 517 632 078 157.96 Fees for patents, licenses, software, licenses 19 675 988 846 26 847 787 047 -26.71 and similar rights Contributions 46 968 903 47 008 183 -0.08 Other external charges 1 150 932 007 1 160 979 915 -0.87

Total 100 976 372 212 113 420 796 394 -10.97

Comments -10.98% of external expenses despite the increase in bank charges.

215 FINANCIAL STATEMENTS SONATEL SA: Note 25: DUTIES AND TAXES

Items 2018 2017 % Variation

Duties and direct taxes 8 707 456 737 3 198 599 625 172.23 Duties and indirect taxes -431 513 129 4 048 225 510 -110.66 Registration Fees (646) 272 715 129 305 396 307 -10.70 Tax penalties and Fines (647) 6 486 938 -100.00 Other duties and taxes (648) 0 0 0.00

Total 8 548 658 737 7 558 708 380 13.10

Comments The large variation in duties and indirect taxes is due to the non-deductible VAT prorated to the main charge.

216 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 26: OTHER EXPENSES

Items 2018 2017 % Variation

Losses on receivables 1 843 251 710 1 621 857 784 13.65

Losses on other debtors 0 0 0.00

Share of profit on joint operations 0 0 0.00

Carrying Value of Current Transfers of Capital Assets 0 0 0.00

Allowances and other remuneration of directors 39 660 165 55 334 178 -28.33

Donations and patronage 1 408 805 979 1 176 910 700 19.70

Other miscellaneous charges 36 886 430 0 0.00

Expenses for provisions and provisions for short-term operating risks 5 100 184 493 2 110 653 062 141.64

Total 8 428 788 777 4 964 755 724 69.77

Comments +69% mainly due to provisioned charges on receivables.

217 FINANCIAL STATEMENTS SONATEL SA: Note 27 A: STAFF COSTS

Items 2018 2017 % Variation

Direct remuneration paid to staff 55 912 657 342 49 548 446 593 12.84

Lump sum payments to staff 7 036 547 476 6 618 937 662 6.31

Social charges 1 502 990 622 1 346 269 750 11.64

Remuneration and social charges of the individual operator 0 0 0.00

Transferred remuneration of external staff 3 317 455 231 2 692 668 210 23.20

Other social charges 3 867 478 096 3 144 550 886 22.99

Total 71 637 128 767 63 350 873 101 13.08

Comments +13.07%: revaluation of salaries and severance pay at retirement.

218 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 27 B: EMPLOYEES, WAGE BILL AND EXTERNAL STAFF

M = Male F = Female Workforce and payroll OTHER UEMOA Ouside Qualifications Nationals STATES UEMOA TOTAL M F M F M F 1. Senior managers 787 487 0 0 0 0 1 274 2. Senior technicians and middle managers 186 139 0 0 0 0 325 3. Technicians, supervisors and skilled workers 104 19 0 0 0 0 123 4. Employees, labourers, workers and apprentices 17 1 0 0 0 0 18 TOTAL (1) 1 094 646 0 0 0 0 1 740 Permanents 0 0 0 0 0 0 0 Seasonals 0 0 0 0 0 0 0 Masse salaire OTHER Ouside Qualifications Nationals UEMOA UEMOA STATES TOTAL M F M F M F 1. Senior managers 35 119 035 902 21 731 855 761 0 0 0 0 56 850 891 663 2. Senior technicians and middle 4 830 864 371 3 610 162 084 0 0 0 0 8 441 026 455 3. Technicians, supervisors and skilled 2 318 437 321 423 560 664 0 0 0 0 2 741 997 986 workers 4. Employees, laborers, workers and 269 882 019 15 875 413 0 0 0 0 285 757 432 apprentices Total (1) 42 538 219 614 25 781 453 922 0 0 0 0 68 319 673 536 Permanents 0 0 0 0 0 0 0 Seasonals 0 0 0 0 0 0 0 Billing to the company 1. Senior managers 0 0 0 0 0 0 0 0 0 2. Senior technicians and middle managers 22 14 0 0 0 0 36 75 709 559 48 178 810 3. Technicians, supervisors and skilled 381 385 0 0 0 0 766 1 311 151 912 1 324 917 286 workers 4. Employees, laborers, workers and 129 33 0 0 0 0 162 443 933 324 113 564 339 apprentices Total (2) 532 432 0 0 0 0 964 1 830 794 796 1 486 660 435 Permanents 0 0 0 0 0 0 0 0 0 Seasonals 0 0 0 0 0 0 0 0 0 Total (1+2) 1 626 1 078 0 0 0 0 2 704 44 369 014 409 27 268 114 358 Comments Of note is an increase in staff and wage bill in 2018 with 37% for women.

219 FINANCIAL STATEMENTS SONATEL SA: Note 28: PROVISIONS AND DEPRECIATION ON THE BALANCE SHEET

Ex- Ex- Provision at cluding cluding Item the opening Operation financial ordinary Operation financial ordinary of the year activi- activities ties Regulated 48 570 773 636 16 486 826 654 0 0 5 101 419 755 0 0 provisions Financial provisions for risks and 0 0 0 0 0 0 0 expenses Depreciation of 931 038 754 334 172 910 0 0 348 179 329 0 0 fixed assets Total allocations 49 501 812 390 16 820 999 564 0 0 5 449 599 084 0 0 Inventory 12 211 272 16 593 881 0 0 12 211 272 0 0 Depreciation Depreciation cur- 0 0 0 0 0 0 0 rent assets (EOA) Depreciation 0 0 0 0 0 0 0 suppliers Depreciation 9 870 572 393 4 994 789 353 0 0 3 035 974 032 0 0 customers Depreciation other 245 992 844 52 163 822 0 0 53 820 286 0 0 receivables Depreciation of investment 0 0 0 0 0 0 0 securities Depreciations 0 0 0 0 0 0 0 values to cash Depreciation liquid 0 0 0 0 0 0 0 assets

220 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 28: PROVISIONS AND DEPRECIATIONS ON THE BALANCE SHEET (Ctd)

Eclud- Provision Ex- ing at the cluding Item Operation financial Operations financial ordinary opening of ordinary activi- the year activities ties Depreciation and provisions for short-term 8 567 037 28 066 599 0 0 0 0 0 operating risks Depreciation and provisions for short-term 0 0 0 0 0 0 0 financial risks Total expenses for depreciation and 10 137 343 546 5 091 613 655 0 0 3 102 005 590 0 0 short-term provisions Total provisions 59 639 155 936 21 912 613 219 0 0 8 551 604 674 0 0 and depreciations

Comments The variation is mainly due to the AGM provision and the adjustment of the pension valuation according to the actuarial method.

221 FINANCIAL STATEMENTS SONATEL SA: Note 29: FINANCIAL EXPENSES AND REVENUES

Items 2018 2017 % Variation

Interest on borrowings 8 097 121 849 8 220 371 337 -1.50 Interest in Acquisition Leases 0 0 0.00 Discounts granted 0 0 0.00 Other interests 0 189 755 -100.00 Discounts of commercial bills 0 0 0.00 Exchange losses 3 633 973 422 901 955 653 302.90 Losses on disposals of investment securities 0 0 0.00 Mainly due to free allocation of shares to salaried staff and 0 0 0.00 managers Financial risk loss 0 0 0.00 Depreciation charges and short-term provisions of a financial 1 665 017 910 356 746 366 366.72 nature (see note 28) Subtotal: Financial expenses 13 396 113 181 9 479 263 111 41 Interest on loans and other receivables 865 974 438 1 272 886 550 -31.97 Income from participating interests 92 563 893 265 94 994 689 347 -2.56 Discounts obtained 25 062 603 34 303 444 -26.94 Investment income 2 005 490 48 127 766 -95.83 Exchange gains 3 502 202 674 2 110 742 636 65.92 Gains on sales of investment securities 0 65 770 250 -100.00 Gains on financial risks 254 366 377 213 092 775 19.37 Reversal of depreciation charges and short-term provisions of 356 746 366 354 793 297 0.55 a financial nature (see Note 28) Subtotal: Financial income 97 570 251 213 99 094 406 065 -2 Total 84 174 138 032 89 615 142 954 -6.07

Comments The variation is mainly on foreign exchange losses.

222 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 30: OTHER REVENU AND EXPENSES EOA

Items 2018 2017 % Variation

Reported charges EOA (1) to be detailed 196 194 816 10 148 500 1 833.24 (1)……………. 0 0 0.00 (1)…………….. 0 0 0.00 Losses on receivables EOA 0 0 0.00 Donations and gifts granted 0 0 0.00 Abandonment of debts granted 0 0 0.00 Provisioned charges EOA 0 0 0.00 Allocations excluding ordinary activities 0 0 0.00 Workers' participation 0 0 0.00 Balancing subsidies 0 0 0.00 SUBTOTAL: Other charges EOA 196 194 816 10 148 500 1 833.24 Reported revenu EOA (1) to be detailed 0 0 0.00 Donations and gifts obtained 0 0 0.00 Abandonment of debts obtained 0 0 0.00 Transfer of charges EOA 0 0 0.00 Reversal of charges for depreciation and short-term provisions EOA 0 0 0.00 Reversals excluding ordinary activities 39 889 086 189 326 275 -78.94 Sub Total: Other products EOA 39 889 086 189 326 275 -78.93 Total 236 083 902 199 474 775 18.35

Comments Expenses EOA are mainly related to the purchase price adjustment of Orange Sierra Leone (Cost of expatriate staff).

223 FINANCIAL STATEMENTS SONATEL SA: Note 31: DISTRIBUTION OF THE INCOME STATEMENT AND OTHER CHARACTERISTIC ELEMENTS OF THE LAST FIVE YEARS

Financial years concerned 2018 2017 2016 2015 2014 nature of the indicators Structure of the Capital at 0 0 0 0 0 the closing of the year (2) Share capital 50 000 000 000 50 000 000 000 50 000 000 000 50 000 000 000 50 000 000 000 Ordinary shares 100 000 000 100 000 000 100 000 000 100 000 000 100 000 000 Preferred dividend shares 0 0 0 0 0 PDS without voting rights New shares to be issued 0 0 0 0 0 - By conversion of bonds » 0 0 0 0 0 - By exercise of subscription 0 0 0 0 0 right » Operations and results of 50 000 000 000 50 000 000 000 0 0 0 the year (2) Turnover excluding taxes 265 066 910 722 321 873 152 157 324 826 597 212 343 973 537 785 355 642 826 151 Earnings from ordinary activities (ROE) excluding 164 034 412 817 221 103 660 378 214 110 676 767 238 735 636 226 240 500 331 381 transfers and reversals (operating and financial) Employee participation in 0 0 0 0 0 profits Income tax 10 656 720 271 31 506 101 374 35 147 613 809 44 761 281 682 45 470 006 918 Net income (1) 106 939 462 716 163 578 622 040 154 175 917 915 158 491 957 942 173 665 631 924 Income and dividend 151 672 800 793 189 497 295 411 0 0 0 distributed Distributed income (2) 166 666 666 667 166 666 666 667 166 666 666 667 166 666 666 667 160 000 000 000 Dividend attributed to each 1 667 1 667 1 667 1 667 1 600 share

224 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 31: DISTRIBUTION OF THE INCOME STATEMENT AND OTHER CHARACTERISTIC ELEMENTS OF THE LAST FIVE YEARS (Ctd)

Staff and salary policy 0 0 0 0 0 Average number of workers 1 740 1 825 1 767 1 719 1 752 during the year (2) Average number of external 3 3 3 5 3 staff Distributed wagebill during 62 949 204 818 56 167 384 255 51 137 801 782 44 529 729 281 50 051 230 506 the year (2) Benefits paid during the financial year (2) [Social 5 370 468 718 4 490 820 636 4 155 818 640 3 658 045 111 4 428 842 872 welfare, social services] External staff charged to the 3 317 455 231 2 692 668 210 2 964 042 055 2 932 146 462 2 021 384 202 entity (2)

Comments Decrease in turnover: -18% Decrease Income: -35% Maintaining the dividend policy: 1667 per share Increase in wage blll: 13%

225 FINANCIAL STATEMENTS SONATEL SA: Note 34: SUMMARY SHEET MAIN FINANCIAL INDICATORS

Items Year N Year N-1 % Variation

Intermediate management balances 0 0 0.00 Turnover 265 066 910 722 321 873 152 157 -17.65 Commercial margin 0 0 0.00 Value added 150 180 564 971 194 844 233 506 -22.92 Gross operating profit (GOP) 78 543 436 204 131 493 360 405 -40.27 Operating income 33 461 918 798 105 221 664 584 -68.20 Financial income 84 174 138 032 89 615 143 094 -6.07 Earnings from ordinary activities 117 636 056 830 194 836 807 678 -39.62 Income excluding ordinary activities -39 873 843 247 915 736 -116.08 Determination of self-financing capacity 0 0 0.00 GOP 78 543 436 204 128 831 928 412 -39.03 +Book values of current asset disposals (account 654) 0 0 0.00 -Income of ordinary capital transfers (account 754) 0 0 0.00 Operating cash flow 78 543 436 204 128 831 928 412 -39.03 +Financial reserves 93 719 869 210 96 630 640 979 -3.01 +Foreign exchange gains 3 502 202 674 2 110 742 636 65.92 +Transfers of financial charges 0 140 -100.00 +Income EOA 0.00 -Transfer of EOA charges -196 194 816 -10 148 500 1 833.24 -Financial expenses -8 097 121 849 -8 229 128 129 -1.60 -Exchange losses -3 633 973 422 -901 955 653 302.90 -Participation 0 0 0.00 -Income taxes -10 656 720 271 -31 506 101 374 -66.18 Total cash flow (GSFC) 153 181 497 730 186 925 978 511 -18.05 -Distribution of dividends made during the year -166 666 666 667 -166 666 666 667 0.00 Self-financing -13 485 168 937 20 259 311 844 -166.56

226

ETATS FINANCIERS SONATEL SA : Note 35 : LISTE DES INFORMATIONS SOCIALES, ENVIRONNEMENTALES ET SOCIETALES A FOURNIR Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 34: SUMMARY SHEET OF THE MAIN FINANCIAL INDICATORS (Ctd)

Profitability Analysis 0 0 0.00 Economic profitability = operating Income (a) / Equity + 0 0 -63.16 financial debt Financial profitability = net income/equity 0 0 -20.93 Analysis of the financial structure 0 0 0.00 Equity and related resources 313 213 611 373 373 130 141 706 -16.06 -Financial debts * and other related resources (b) 160 038 996 610 163 387 539 690 -2.05 = Stable resources 153 174 614 763 209 742 602 016 -26.97 -Immobilized assets (b) 507 151 310 903 490 362 068 090 3.42 Working capital -353 976 696 140 -280 619 466 074 26.14 Current operating assets (b) 194 788 259 148 258 865 316 821 -24.75 -Current operating liabilities (b) -118 361 135 448 -154 520 135 036 -23.40 = Need for operating funding (2) 76 427 123 700 104 345 181 785 -26.76 Current assets EOA 0 0 0.00 Current liabilities EOA -7 542 177 892 -7 113 688 757 6.02 = Need for financing EOA -7 542 177 892 -7 113 688 757 6.02 Need for global financing 68 884 945 808 97 231 493 028 -29.15 61 342 767 916 90 117 804 271 -31.93 Net cash 0 0 0.00 Control: Net cash = (Cash-assets) - (Cash-liabilities) -102 820 201 908 -51 978 092 327 97.81 Analysis of cash flow variation 0 0 0.00 Cash flow from operating activities 183 114 051 770 -59 501 418 576 -407.75 - Cash flow from investing activities -52 555 544 705 -74 369 848 010 -29.33 +Cash flow from financing activities -181 400 616 646 137 429 355 811 -232.00 = Variation in net cash position for the period -50 842 109 581 3 558 089 225 -1 528.92 Analysis of the variation in net financial indebtedness 0.00 Gross financial debt 202 903 017 983 166 794 858 381 21.65 (financial debts * + cash - liabilities) - cash - assets Financial indebtedness 152 060 908 402 170 352 947 606 -10.74

227

ETATS FINANCIERS SONATEL SA : Note 35 : LISTE DES INFORMATIONS SOCIALES, ENVIRONNEMENTALES ET SOCIETALES A FOURNIR (suite) FINANCIAL STATEMENTS SONATEL SA: Note 35: LIST OF SOCIAL, ENVIRONMENTAL AND SOCIETAL INFORMATION

SOCIAL INFORMATION

Employment: The total workforce 2704 including 1740 permanent contracts. 37% of the permanent staff are women 51% of the permanent workforce is under 40 years old - The number of hires is 105 - The outside staff wage bill is 68.3 billion Social relations: NNumber of agreements signed with the trade unions during the year: 2 Number of Staff Delegate (SD) meetings: 9 Number of CHSCT (Health, Hygiene., Safety, Working conditions committee) meetings: 188 Training: - Total number of training hours: 103 145 hours - Number of trainings: 315 - Number of employees who have completed at least one training: 1,279 Health and safety - Number of employees trained in safety: 442 - Number of medical acts (employees including their families): 38,319 Equal treatment: Percentage of women hired: 35% - Distribution of women promotions: 37.7% - Number of employees with disabilities: 6

ENVIRONMENTAL INFORMATION

General environmental policy: «Sonatel offers equipment and services that are more energy efficient, in line with the international energy efficiency standard and applicable Senegalese regulations. Continuation of the concept «Sonatel clean cities» or «and defar sunu gox» in the communities of Matam, Dabia and Grand Yoff».

Pollution and waste management: «From the design of its offers, SONATEL has identified the negative environmental impacts (water, soil, air, noise, smell, visual) of its equipment including packaging and services for their entire life cycle. Quantities of used and waste oils (liters): 5,900 (estimated) Weight of used electrical and electronic equipment collected from customers, considered as waste products (ton): 13.32»

Sustainable use of resources: - Quantity of electricity used for tertiary activities, offices, shops, call centers (Gwh): 6.4 in 2018 against 7.6 in 2017

Climate change: - Total emission of CO2 linked to the use of electricity (teqco2): 45139,48 (2017)

228 Sonatel Annual Report 2018

FINANCIAL STATEMENTS SONATEL SA: Note 35: LIST OF SOCIAL, ENVIRONMENTAL AND SOCIETAL INFORMATION (Ctd)

INFORMATION RELATING TO SOCIETAL COMMITMENTS IN FAVOR OF SUSTAINABLE DEVELOPMENT

Relations with people or organizations interested in the company’s activity (integration asso- ciation, educational institutions ...):

- Number of agreements signed during the year with initial training institutions (schools and universities): 2 - Recruitment of learners of the 2nd batch (100 face-to-face and 200 online) for training in the digital professions.

Subcontracting and suppliers: The equipment or services provided to Sonatel, the contracting party to ensure that all personnel of the contracting party, of its subcontractors who work on a Sonatel site comply with the laws, regulations and text at work that ap- plies specifically to this site or to that entity.

the qualitative information in note 35 is «unaudited»

229

ANNEXES 10Auditors General Report on the consolidated accounts of the Sonatel Group  Auditors General and Special Report on the consolidated accounts of Sonatel SA Agenda of the Ordinary General Meeting AUDITORS GENERAL REPORT ON THE CONSOLIDATED ACCOUNTS OF THE SONATEL GROUP

Consolidated Financial Statements - Year ended 31 December, 2018

Ladies and Gentlemen, shareholders Opinion

We audited the financial statements of the SONATEL Group (SONATEL, SONATEL Mobile, Orange Mali, SONATEL Multimedia, SONATEL Business Solutions, Orange Guinea, Orange Bissau, Orange Sierra Leone, Orange Money Sierra Leone Limited, Orange Mobile Finance Senegal, Orange Mobile Finance Mali and Orange Guinea Mobile Finance, Orange Services Group) including the balance sheet, the income statement, the financial resources and jobs table and the notes to the consolidated financial statements of SONATEL at 31 December, 2018, as they are attached to this report.

In our opinion, the consolidated financial statements give a true and fair view of the results of the operations of the past financial year as well as the financial position and assets of the group of companies included in the consolidation at the end of this financial year, in accordance with the accounting rules and methods of the OHADA Uniform Act on Accounting Law and Financial Reporting. Basis for opinion

We conducted our audit in accordance with the IAASB’s International Standards on Auditing (ISA) in accordance with Regulation No. 01/2017/CM/OHADA on the harmonization of the practices of accounting and auditing professionals in OHADA Member States. Our responsibilities under these standards are set out in the «Auditors’ Responsibilities for Auditing Financial Statements» section of this report.

We are independent of the company, in accordance with the Code of Ethics and Professional Conduct of Accountants and the rules of independence that govern our statutory audit, and we have fulfilled the other ethical responsibilities incumbent on us according to these rules. We believe that the audit evidence we have gathered is sufficient and appropriate to provide a basis for our audit opinion. Emphasis of matter paragraph

We draw attention to the note on page 17 of the financial statements that describes the impact of the change in accounting regulations with the entry into force of the new Uniform Act on Accounting Law and Financial Reporting. This point does not affect our opinion expressed above.

232 Sonatel Annual Report 2018

Key points of the audit

The key points of the audit are the points that, in our professional judgment, were most important in the audit of the consolidated financial statements for the current period. These points have been addressed in the context of our audit of the consolidated financial statements as a whole and when forming our opinion on them. We do not express a separate opinion on these points.

Key points of our audit Answers made during our audit

With respect to telecommunication activities, we gained an understanding of the process of accounting for different Recognition of the income of telecommunications revenue streams from contract conclusion and initiation of SONATEL’s telecommunication activities are characterized a transaction to billing, receipt of payments and recognition. by numerous commercial offers that evolve frequently and a large amount of data to process. This makes it necessary As part of our work, we have in particular: to apply different turnover recognition principles depending - identified the main controls put in place by the Group and on the nature of the products or services sold and the use relevant to our audit, including general IT controls, and of complex information systems for turnover recognition, then tested their effectiveness by sampling; including the correct connection to the fiscal year. - carried out tests on the functionalities of business and commercial application systems, which are part of the The breakdown of the turnover is presented in Note 18 process of preparing accounting and financial data as of the annexe of the consolidated accounts. Given the well as tests on the configuration of accounting systems; complexity of the information systems and the judgments - performed analytical procedures, comparing our own and estimates used in the determination of the turnover, estimates of turnover with the recorded turnover, we considered that the recognition of the turnover from examined a selection of manual end-of-period entries by telecommunications activities is a key point in our audit. comparing these entries with our own calculations and estimates and obtaining their justification. Commissioning of assets under construction We obtained an understanding of the capital management At 31 December, 2018, net tangible fixed assets process. amounted to CFAF 706.8 billion. The Group’s fixed assets are presented in note 3 of the consolidated financial During our work on the accounts, we notably: - made statements. This item includes assets under construction requests for confirmation of the status of fixed assets to valued at CFAF 177.9 billion, representing 25% of total net the technical services; tangible fixed assets and 10% of total assets. - assessed the reasonableness of depreciation allowances estimated by the financial services; Given the high number of ongoing fixed asset-related - tested a representative sample of the receivables by transactions, there is still a risk that the commissioning reconciliation with the minutes of receipt; minutes will not be sent to the financial services in time for - compared the change in seniority of fixed assets an exhaustive assessment of the depreciation expenses of compared to the previous year to identify and analyze the fixed assets concerned. inconsistencies.

At the end of the period, the financial services evaluate the amortization expense on the fixed assets identified as commissioned by the technical services.

As a result, we considered the full accounting of depreciation expense as a key point in our audit.

233 Responsibilities of management and individuals corporate governance relating to the financial statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the accounting rules and methods of the OHADA Uniform Act on Accounting and Financial Reporting and internal control it considers necessary to prepare financial statements that are free of material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for evaluating the Company’s ability to continue as a going concern, to present in these accounts, as appropriate, the necessary information relating to the continuity of operations and apply the going concern accounting policy unless it is intended to wind up the company or cease operations or if there is no other realistic alternative available to it.

The Audit Committee is responsible for following the financial reporting process and for monitoring the effectiveness of the internal control and risk management systems and, where applicable, internal audit, in procedures relating to the preparation and processing of accounting and financial information. Responsibilities of the Statutory Auditors relating to the audit of the financial statements

Our objective is to obtain reasonable assurance that the consolidated financial statements as a whole do not contain material misstatements. Reasonable assurance is a high level of assurance, but it does not guarantee that an audit performed in accordance with professional standards will systematically detect any material misstatement. Anomalies may arise from fraud or error and are considered material where it can reasonably be expected that they, taken individually or in combination, may influence the economic decisions that account users take in their business. based on these.

As part of an audit conducted in accordance with applicable standards and throughout, we exercise our professional judgment and are critical. Further:

- We identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, the definition and implementation of audit procedures in response to such risks, and the collection of sufficient and appropriate evidence to support our opinion. The risk of not detecting a material misstatement due to fraud is higher than that of a materia misstatement resulting from an error, as the fraud may involve collusion, forgery, voluntary omissions, misrepresentation or circumventing internal control.

- We take cognizance of the internal control relevant to the audit in order to define appropriate audit procedures in the circumstances, but not to express an opinion on the effectiveness of the internal control of the company.

- We assess the appropriateness of the accounting policies used and the reasonableness of accounting estimates made by management, as well as the information provided by them.

- We conclude with respect to the appropriateness of management’s application of the going concern accounting principle and, based on the audit evidence gathered, whether or not there is significant uncertainty related to events or any condition that casts significant doubt on the company’s ability to continue as a going concern. If we find material uncertainty, we are required to draw the attention of readers of our report to the information provided in the financial statements about this uncertainty or, if this information is not adequate, to express an amended opinion. Our conclusions are based

234 Sonatel Annual Report 2018

on the evidence gathered up to the date of our report. However, future conditions or events could lead the company to cease operation.

- We appreciate the overall presentation, structure and content of the financial statements, including the information provided in the financial statements, and assess whether the financial statements reflect the underlying transactions and events in such a way that they give a sincere presentation.

- We collect sufficient appropriate audit evidence concerning the financial information of the Group’s entities or activities to express an opinion on the consolidated financial statements. We are responsible for leading, supervising and conducting the Group audit. We take full responsibility for the audit opinion.

- We disclose to the persons constituting corporate governance the scope of the planned audit work and schedule and important findings, including any significant weaknesses in internal control identified in our audit.

- We also provide the persons charged with corporate governance with a statement that we have complied with the relevant rules of ethics regarding independence, and disclose to them, as the case may be, all relationships and other factors that may reasonably be considered to have an impact on our independence and related safeguarding measures.

Among the points communicated to those charged with corporate governance, we determine which ones were most important during the audit of the financial statements of the current period, which are therefore the key points of the audit. We describe these points in our audit report, unless the law or regulation prohibits their publication or if, in extremely rare circumstances, we determine that we should not disclose a point in our audit report because the reasonably expected adverse consequences of the communication of this point exceed the benefits to the public interest. Specific verifications and information

Responsibility for other information rests with the Board of Directors. Other information consists of the information contained in the management report of the consolidated group but does not include the consolidated financial statements and our auditors report on these consolidated financial statements, and other information.

Our opinion on the consolidated financial statements does not extend to other information and we do not express any form of assurance on this information.

235 As part of our statutory audit mandate, our responsibility is, on the one hand, to carry out the specific verifications required by law and regulations, and in so doing, to verify the fairness and consistency with the consolidated financial statements of the Company. the information given in the Group’s management report and in the documents addressed to the shareholders with respect to the financial position and the consolidated financial statements, and to verify, in all material respects, compliance with certain legal and regulatory requirements. On the other hand, our responsibility is also to read the other information and, consequently, to assess whether there is a material inconsistency between these and the financial statements or the knowledge that we have acquired during the audit, or if the other information seems to contain a material misstatement.

We have nothing to report in this regard.

The Auditors

GARECGO RACINE MEMBER OF THE JPA NETWORK MEMBER OF ERNST INTERNATIONAL & YOUNG

Mamour FALL, Partner Makha SY, Partner

22 March, 2019

236 Sonatel Annual Report 2018

ACCOUNTING RULES AND METHODS

Principles of consolidation

Companies under exclusive control are fully consolidated. Presentation of financial statements

The financial statements are presented using the SYSCOHADA model: Balance sheet, Profit and loss account, TAFIRE, attached notes. Basis of preparation of the financial statements

The financial statements are prepared on the basis of historical costs and presented according to generally accepted principles and methods in the countries of presence. They comply with the SYSCOHADA requirements based on corporate financial statements established in SYSCOHADA revised. Intangible fixed assets

They are amortized over a period of five (5) years. «Unbundled» software (which is invoiced separately from computer hardware) is also capitalized and amortized over an estimated useful life of three (3) years.

Foreign exchange differences to be allocated are measured in accordance with the principles of foreign exchange transactions. Tangible fixed assets

They are valued at their acquisition cost including the purchase price and the approach costs and amortized on a straight-line basis over their estimated useful life as follows: Constructions 20 years Land reclamation works 40 years Office furniture and housing 10 years Office equipment and supplies 05 years Fixtures, fittings, installations 10 years Transportation equipment 05 years Switching Hardware 10 years Transmission and Data Equipment 10 years Lines and networks equipment 10 years Energy Equipment 10 years Measuring devices 03 years Other Operating Materials 10 years Fixed assets in progress are recorded at their acquisition cost and are reclassified as final assets at commissioning.

237 Other fixed values

They concern, housing and vehicle loans to staff, State loan to staff for the acquisition of shares in the company (10%), deposits and surety paid on subscriptions of water and electricity but also rents in advance, and equity securities.

These fixed assets are recorded and valued at historical cost.

In securities, provisions for depreciation are made when the value at closing is lower than the historical cost.

The value at closing is either the stock market price for listed securities or the net asset value for unlisted securities. Stocks

Inventories are valued at the weighted average cost of purchases. The values used for local purchases correspond to the real firm and non-revisable cost annexed to the contract agreements.

The purchase cost of imported products corresponds to the market value plus customs duties and transit fees.

Provisions for depreciation are made up of 100% of defective, dormant (stock that has not recorded movements for 1 year) and dead stocks (stock declassified or not recorded movements for 3 years). Receivables

- Accounting of services to local customers The services on local customers are invoiced in CFAF at the date of issuance of the invoice and recorded in the accounts 41. The services not yet invoiced at the closing date are recorded in the accounts 418: Accrued income

Refill cards sold and not used by customers are recognized as deferred revenue.

Doubtful loans to private customers are written down at 100% as follows: - more than 6 months of seniority for fixed; - more than 90 days of seniority for Mobile.

- Accounting for international traffic products The traffic balances are compiled monthly, bimonthly or quarterly on the basis of the statements recorded after acceptance by the foreign correspondent concerned in a miscellaneous debtor or creditor account according to the balance of the operations monthly, bimonthly or quarterly.

At the end of the year, a provision is calculated for all traffic balances not yet accepted. It is recorded in 418300 (receivables) when the balance is in favor of SONATEL and in accrued charges otherwise in the accounts of suppliers invoices not received (408400).

Translation differences are recognized in the balance sheet in the 478 or 479 «translation difference» accounts.

Receivables from correspondents are depreciated on a case by case basis depending on the creditworthiness of the correspondent.

238 Sonatel Annual Report 2018

Currency Transactions

Foreign currency transactions are translated on the day of their posting. Foreign exchange differences are recognized as foreign exchange gains or losses on settlement.

Foreign currency accounts are translated at the exchange rate prevailing on the closing date of the financial year. Potential exchange gains are not recognized as revenue but as an asset or liability translation difference. Unrealized exchange losses give rise to a provision for risks.

In the income statement Unrealized foreign exchange losses on transactions of more than one year are recorded as a liability in a «provision for foreign exchange losses» account and the counterpart is entered as balance sheet assets in account 478 «foreign exchange difference».

Unrealized foreign exchange losses on trade receivables and payables are recorded in account 6591 by account credit 4991 provisions for short-term risks on operating transactions and unrealized foreign exchange losses on financial transactions within one year are recorded in the 6791 account by the credit of account 4997 provisions for short-term risks on financial operations.

The losses on the cash accounts are entered in the income statement by the counterpart of the treasury account. Investment subventions

They are transferred to the accrual and deferred income account. The amortized share of the year is in the income statement. Provisions for losses and charges

- Litigation All potential risks in litigation with third parties are provided for according to the information provided by the Company’s legal departments. Provisions not applicable are reported in the income statement.

- Retirement benefits Compensation due to staff at retirement or in a contractual context is subject to a provision for expenses. With the SYSCOAHADA reform that came into effect on 1 January, 2018, the provision is assessed using the actuarial method. Deferred taxes

Deferred taxes were entered in the books to reverse the effect of the temporary shifting of charges and income due to tax considerations. The liability method was used.

239 Electronic money

Orange Money is the mobile payment offer marketed by an EME electronic money institution approved by the BCEAO or the Central Bank of Guinea.

The offer consists of issuing and distributing electronic money or units of value «UV» that can be used in commercial transactions.

The currency in circulation is recorded in the 514xxx cash accounts in exchange for the debts entered in the 472xxx accounts by category (distributors, billers, merchants and final customer).

The issued and undistributed currency remains in the EME’s main cash account. Commissions paid are recognized as expenses and those received as revenue.

240 Sonatel Annual Report 2018

AUDITORS GENERAL AND SPECIAL REPORT ON SONATEL SA

Financial Statements - Year ended 31 December, 2018

Ladies and Gentlemen, shareholders Opinion

We have audited the financial statements of SONATEL SA including the balance sheet, the income statement, the cash flow statement and the notes to the financial statements as at 31 December 2018, as attached to this report,

In our opinion, the consolidated financial statements give a true and fair view of the results of the operations of the past financial year as well as the financial position and assets of the group of companies included in the consolidation at the end of this financial year, in accordance with the accounting rules and methods of the OHADA Uniform Act on Accounting Law and Financial Reporting. Basis of opinion

We conducted our audit in accordance with the IAASB’s International Standards on Auditing (ISA) in accordance with Regulation No. 01/2017/CM/OHADA on the harmonization of the practices of accounting and auditing professionals in OHADA Member States. Our responsibilities under these standards are set out in the «Auditors’ Responsibilities for Auditing Financial Statements» section of this report.

We are independent of the company, in accordance with the Code of Ethics and Professional Conduct of Accountants and the rules of independence that govern our statutory audit, and we have fulfilled the other ethical responsibilities incumbent on us according to these rules. We believe that the audit evidence we have gathered is sufficient and appropriate to provide a basis for our audit opinion.

Emphasis of matter paragraph

We draw attention to note 2 of the financial statements which describes the impact of the change in accounting regulations with the entry into force of the new Uniform Act on Accounting Law and Financial Reporting. This point does not affect our opinion expressed above. Key points of the audit

The key points of the audit are the points that, in our professional judgment, were most important in the audit of the consolidated financial statements for the current period. These points have been addressed in the context of our audit of the consolidated financial statements as a whole and when forming our opinion on them. We do not express a separate opinion on these points.

241 Key points of our audit Answers provided during our audit

Recognition of the income of With respect to telecommunication activities, we gained an telecommunications understanding of the process of accounting for different SONATEL’s telecommunication activities are characterized revenue streams from contract conclusion and initiation of by numerous commercial offers that evolve frequently and a transaction to billing, receipt of payments and recognition. a large amount of data to process. This makes it necessary to apply different turnover recognition principles depending As part of our work, we have in particular: on the nature of the products or services sold and the use - identified the main controls put in place by the Group and of complex information systems for turnover recognition, relevant to our audit, including general IT controls, and including the correct connection to the fiscal year. then tested their effectiveness by sampling; - carried out tests on the functionalities of business and The breakdown of the turnover is presented in Note 21 commercial application systems, which are part of the of the annexe of the consolidated accounts. Given the process of preparing accounting and financial data as complexity of the information systems and the judgments well as tests on the configuration of accounting systems; and estimates used in the determination of the turnover, - performed analytical procedures, comparing our own we considered that the recognition of the turnover from estimates of turnover with the recorded turnover, telecommunications activities is a key point in our audit. - examined a selection of manual end-of-period entries by comparing these entries with our own calculations and estimates and obtaining their justification.

Commissioning of assets under construction We obtained an understanding of the capital management At 31 December, 2018, net tangible fixed assets amounted process. to 131.1 billion CFAF. The Group’s fixed assets are presented in note 3 of the consolidated financial statements. During our work on the accounts, we notably: This item includes assets under construction valued at 32.1 billion CFAF. - made requests for confirmation of the status of fixed assets to the technical services; Given the high number of ongoing fixed asset-related - assessed the reasonableness of depreciation allowances transactions, there is still a risk that the commissioning estimated by the financial services; minutes will not be sent to the financial services in time for - tested a representative sample of the receivables by an exhaustive assessment of the depreciation expenses of reconciliation with the minutes of receipt; the fixed assets concerned. - compared the change in seniority of fixed assets compared to the previous year to identify and analyze At the end of the period, the financial services evaluate inconsistencies. the amortization expense on the fixed assets identified as commissioned by the technical services.

As a result, we considered the full accounting of depreciation expense as a key point in our audit.

Responsibilities of management and those charged with governance of the financial statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with the accounting rules and methods of the OHADA Uniform Act on Accounting and Financial Reporting and internal control it considers necessary to prepare financial statements that are free of material misstatement, whether due to fraud or error.

In preparing the financial statements, it is management’s responsibility to evaluate the ability of the Company to continue as a going concern, to present in these accounts, as appropriate, the necessary information relating to the continuity of operations and apply the going concern accounting policy unless it is intended to wind up the company or cease operations or if there is no other realistic alternative available to it.

242 Sonatel Annual Report 2018

The Audit Committee is responsible for following the financial reporting process and for monitoring the effectiveness of the internal control and risk management systems and, where applicable, internal audit, in procedures relating to the preparation and processing of accounting and financial information.

Responsibilities of the Statutory Auditors in the Auditing of Financial Statements

Our objective is to obtain reasonable assurance that the consolidated financial statements as a whole do not contain material misstatements. Reasonable assurance is a high level of assurance, but it does not guarantee that an audit performed in accordance with professional standards will systematically detect any material misstatement. Anomalies may arise from fraud or error and are considered material where it can reasonably be expected that they, taken individually or in combination, may influence the economic decisions that account users take in their business based on these.

As part of an audit conducted in accordance with applicable standards and throughout, we exercise our professional judgment and are critical. Further:

- We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, the definition and implementation of audit procedures in response to such risks, and the collection of evidence sufficient and appropriate to base our opinion. The risk of not detecting a material misstatement due to fraud is higher than that of a material misstatement resulting from an error, as the fraud may involve collusion, forgery, voluntary omissions, misrepresentation or circumventing internal control. - We take cognizance of the internal control relevant to the audit in order to define appropriate audit procedures in the circumstances, but not to express an opinion on the effectiveness of the internal control of the company. - We assess the appropriateness of the accounting policies used and the reasonableness of accounting estimates made by management, as well as the information provided by them. - We conclude with respect to the appropriateness of management’s application of the going concern accounting principle and, based on the audit evidence gathered, whether or not there is significant uncertainty related to events or any condition that casts significant doubt on the company’s ability to continue as a going concern. If we find material uncertainty, we are required to draw the attention of readers of our report to the information provided in the financial statements about this uncertainty or, if this information is not adequate, to express an amended opinion. Our conclusions are based on the evidence gathered up to the date of our report. However, future conditions or events could lead the company to cease operation.

We appreciate the overall presentation, structure and content of the financial statements, including the information provided in the financial statements, and assess whether the financial statements reflect the underlying transactions and events in such a way that they give a sincere presentation.

We disclose to the persons constituting corporate governance the scope of the planned audit work and schedule and important findings, including any significant weaknesses in internal control identified in our audit.

We also provide the persons charged with corporate governance with a statement that we have complied with the relevant rules of ethics regarding independence, and disclose to them, as the case may be, all relationships and other factors that may reasonably be considered to have an impact on our independence and related safeguarding measures.

243 Among the points communicated to those charged with corporate governance, we determine which ones were most important during the audit of the financial statements of the current period, which are therefore the key points of the audit. We describe these points in our audit report, unless the law or regulation prohibits their publication or if, in extremely rare circumstances, we determine that we should not disclose a point in our audit report because the reasonably expected adverse consequences of the communication of this point exceed the benefits to the public interest. Specific verifications and information

Responsibility for other information rests with the Board of Directors. Other information consists of the information contained in the management report of the consolidated group but does not include the financial statements and our auditors report on these financial statements, and other information.

Our opinion on the financial statements does not extend to other information and we do not express any form of assurance whatsoever on this information.

As part of our statutory audit mandate, our responsibility is, on the one hand, to carry out the specific verifications required by law and regulations, and in so doing, to verify the fairness and conformity with the financial statements of the information. in the management report, and in the documents addressed to shareholders on the financial position and the financial statements, and to verify, in all material respects, compliance with certain legal and regulatory requirements.

On the other hand, our responsibility is also to read the other information and, consequently, to assess whether there is a material inconsistency between these and the financial statements or the knowledge that we have acquired during the audit, or if the other information seems to contain a material misstatement.

The Auditors

GARECGO RACINE MEMBER OF THE JPA NETWORK MEMBER OF ERNST INTERNATIONAL & YOUNG

Mamour FALL, Partner Makha SY, Partner

22 March, 2019

244 Sonatel Annual Report 2018

AUDITORS SPECIAL REPORT ON THE REGULATED AGREEMENTS OF SONATEL SA

Financial year ended 31 December, 2018

Ladies and Gentlemen, shareholders

As the statutory auditor of your company, we present to you our report on the regulated agreements.

It is our responsibility to communicate to you, on the basis of the information provided to us, the characteristics and the essential terms of the agreements of which we have been informed, without having to express an opinion on their usefulness and their validity. It is your responsibility, under the terms of Articles 440 et seq. of the OHADA Uniform Act concerning the law of commercial companies and economic interest groups, to assess the interest involved in the conclusion of these agreements for their approval.

Further, it is our responsibility, where applicable, to provide you with information relating to the execution, during the past financial year, of the agreements already approved by the general meeting.

We have been informed of the execution of the following agreements, concluded during the financial year and previously authorized by the Board of Directors.

We did our work according to the standards of the profession; these standards require that we perform the necessary procedures to verify that the information provided to us is consistent with the source documents from which it was derived.

245 AGREEMENTS SUBMITTED TO APPROVAL OF THE GENERAL MEETING

Agreements authorized during the past financial year by the Board of Directors

1. Loan agreement with Orange Sierra Leonet Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Madame Aminata Mélina KANE Nature and object

This loan agreement, authorized at the 181st Meeting of the Board of Directors of SONATEL SA of 23 October, 2018, was signed between Orange Sierra Leone and SONATEL SA on 22 November, 2018.

This is a short-term loan of 7,500,000 Euros to finance Orange Sierra Leone’s cash flow requirements, notably for supplier payments and regulatory fees.

Modalities and effects

The loan is granted for a period of twenty-four months (24) with six months (6) of deferred interest and principal, at the rate of 9% per annum.

As of 31 December, 2018, the balance of the loan amounts to 4,920 million XOF.

2. Loan agreement with Orange Sierra Leone Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Madame Aminata Mélina KANE

246 Sonatel Annual Report 2018

Nature and object

This loan agreement, authorized at the 178th Meeting of the Board of Directors of SONATEL SA of 15 February, 2018, was signed between Orange Sierra Leone and SONATEL SA on 1st March 2018.

This is a short-term loan of Euros 2,000,000, intended to finance Orange Sierra Leone’s cash flow requirements, in particular to deal with suppliers’ payments and regulatory fees. Modalities and effects

The loan is granted for a period of twenty-four months (24) with six months (6) deferred, at a rate of 9% per annum.

As of 31 December, 2018, the loan agreement generated interest totaling 98 million XOF.

However, the SONATEL Board of Directors at its 180th Meeting on August 6, 2018, authorized the capitalization of this loan.

3. Loan agreement with Orange Sierra Leone Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Madame Aminata Mélina KANE Nature and object

This loan agreement, authorized at the time of the 179th Meeting of the Board of Directors of SONATEL SA of 17 April, 2018, was signed between Orange Sierra Leone and SONATEL SA on 17 July, 2018.

This is a short-term loan of 2,000,000 Euros, intended to finance Orange Sierra Leone’s cash flow requirements, in particular to deal with suppliers’ payments and regulatory fees. Modalities and effects

The loan is granted for a period of twenty-four months (24) with six months (6) deferred, at a rate of 9% per annum.

As of 31 December, 2018, the loan agreement recorded interest totaling 86 million XOF.

However, the SONATEL Board of Directors at its 180th Meeting on 6 August, 2018, authorized the capitalization of this loan.

247 4. Loan Agreement with Orange Guinea Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Mr. Aboubacar Sadikh DIOP. Nature and object

This loan agreement, authorized at the time of the 179th Meeting of the Board of Directors of SONATEL SA of 17 April, 2018, was signed between Orange Guinea and SONATEL SA on 18 April, 2018.

This is a short-term credit of 29,239,437 Euros intended to enable Orange Guinea to have a liquidity facility for the payment of dividends due to SONATEL SA for the year ended 31 December, 2017. Modalities and effects

The loan is for a period of six months (6), at a rate of 9% per annum. This loan was not executed in 2018.

248 Sonatel Annual Report 2018

AREEMENTS ALREADY APPROVED BY THE GENERAL MEETING Agreements authorized during previous financial years and whose execution continued during the last financial year

In addition, pursuant to Article 440 of the OHADA Uniform Act on Commercial Company Law and Economic Interest Groups, we have been informedthat the execution of the following agreements, referred to in Article 438 of this Act and approved in previous years, continued during the last financial year.

5. Loan Agreement with Orange Guinea

Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Mr. Aboubacar Sadikh DIOP Nature and object

This loan agreement, authorized at the time of the 173rd meeting of the Board of Directors of SONATEL SA of 18 April, 2017, was signed between Orange Guinea and SONATEL SA on 22 May, 2017.

This is a short-term loan of 22,635,460 Euros, for a term of 10 months starting on 20 April, 2017. This loan is intended exclusively to enable Orange Guinea to have a liquidity facility for the full payment of the net dividends due to SONATEL for the year ended 31 December, 2016. Modalities and effects

The loan is for a period of ten months, at a rate of 7.5% per annum. Thus, the loan will have to be repaid by Orange Guinea in two (2) instalments:

The first instalment on 20 September, 2017 for an amount of 12,038,562 Euros including interest amounting to 720,832 Euros.

The second instalment on February 20, 2018 for an amount of 11,678,146 Euros including interest for 360,416 Euros.

As of 31 December, 2018, the loan was fully repaid and the interest recorded by SONATEL SA over the period amounted to 564 million XOF.

249 6. Cooperation Agreement between Sonatel and Orange SA Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr. Alioune NDIAYE. - Mr Thierry BRETON. - Mr Ludovic Pech. - Mr. Jérôme HENIQUE. - Mr Fabrice ANDRE. Nature and object

This is a cooperation agreement signed on 18 December 2013 between SONATEL SA and Orange SA for a period of three (3) years and extended for a period of three (3) months from 1 January 2017 by amendment n°1 signed on 27 July, 2017. This agreement was the subject of an amendment n° 2 signed on 27 July, 2017 which on the one hand extended the duration of the cooperation agreement signed between SONATEL and Orange SA on 18 December, 2013, for three (3) years from 1st April 2017, and on the other hand extended the scope of the SONATEL Group to Orange Finance Mobiles Senegal and Orange Sierra Leone.

This agreement was also the subject of an amendment n° 3 signed on December 20, 2017 to enter the sale of the Orange SA agreement to its subsidiary Orange-MEA SA as of 1st January 2018. SONATEL SA has accepted the sale, from 1 January 2018 by Orange SA to its subsidiary Orange-MEA SA of all its rights and obligations under the agreement of 18 December 2013 extended until 31 March 2020.

As of January 1, 2018, Orange-MEA SA took over from Orange SA in executing the agreement.

Through this agreement, Orange-MEA SA provides know-how to SONATEL SA and its Senegalese subsidiaries and provides the following services to SONATEL SA and all its subsidiaries:

- transfer of know-how in all areas of operation and development of a telecommunications company (strategic planning, technical, regulatory, financial, information system, purchasing, ...);

- permanent technical assistance with the provision of permanent experts who will participate in the steering and management of the company and subsidiaries;

- technical assistance from time to time with the realization of one off and specific studies, the resolution of problems related to its organization or its operation. Modalities and effects

In return for the transfer of know-how and services rendered, SONATEL SA will pay to Orange- MEA SA an annual fee equivalent to 0.31% of turnover from the Senegal side (Sonatel SA, Sonatel Mobiles, Sonatel Multimedia, Sonatel Business Solutions, Orange Senegal Mobile Finance) net of intragroup business.

For fiscal year 2018, the fees recognized under this agreement and its amendments amount to 1,445 million XOF.

250 Sonatel Annual Report 2018

As part of the cost of making the staff available, SONATEL SA re-invoiced to Orange-MEA SA, expenses related to expatriates supported by SONATEL SA and which are outside the lumpsum price set by Orange SA. The amount of charges billed by SONATEL SA amounts to 89 million XOF as of 31 December, 2018.

7. Memorandum of Understanding between Sonatel SA and Orange SA Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr. Alioune NDIAYE. - Mr Thierry BRETON. - Mr Ludovic Pech. - Mr. Jérôme HENIQUE. - Mr Fabrice ANDRE Nature and object

A memorandum of understanding was signed on 18 December 2013 (with effect from 1 January 2014) between SONATEL SA and Orange SA for a period of three years, until 31 December 2016. An amendment n° 1 was then signed on 27 July, 2017 to extend the term by three (3) months from 1 January, 2017.

This MOU was the subject of an amendment n° 2 signed on 27 July, 2017 to extend the duration to three (3) years, as of 1 April, 2017, and extend the scope of the SONATEL Group to Orange Finances Mobiles Senegal and Orange Sierra Leone. This MOU was also the subject of an amendment n° 3 signed on 20 December, 2017 in order to make the transfer of the Orange SA protocol to its subsidiary Orange-MEA SA effective 1 January, 2018. SONATEL SA has accepted the transfer, from 1 January 2018 by Orange SA to its subsidiary Orange-MEA SA of all its rights and obligations under the agreement of 18 December 2013 extended until 31 March 2020.

In this agreement, Orange SA and SONATEL SA have agreed that the know-how transfer fee of 0.31%, applied to the annual turnover of the Senegal side net of intra-Group activities, is calculated in such a way that the sums of Orange brand royalties applied to the Orange Senegal side (Sonatel SA, Sonatel Mobiles, Sonatel Multimedia, Sonatel Business Solutions) and the total SONATEL Group know-how and assistance transfer fees do not exceed 1.43% of the consolidated turnover of the SONATEL Group for the 2013 financial year.

As of 1 January, 2018, Orange-MEA SA took over from Orange SA in executing the agreement.

251 Modalities and effects

If this royalty exceeds 1.43% of the SONATEL Group’s consolidated revenue in 2013, it will be adjusted so as not to exceed the amount corresponding to 1.43% of the consolidated turnover of the SONATEL Group.

This fee may not be less than 0.20% of the annual turnover of the Senegal side net of intra-group activities.

The SONATEL Group refers to SONATEL SA and its existing subsidiaries as of November 1, 2011. New subsidiaries registered outside Senegal that would join the scope of the SONATEL Group after that date are excluded from the adjustment mechanism for know-how transfer fees.

As of 31 December, 2018, the excess royalty amounted to 513 million CFAF, with an equal effect on the revenu of SONATEL SA.

8. Shareholder loan agreement with the Orange Services Group (GOS) Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Birago Diène Moctar BEYE. Nature and object

This loan agreement authorized by the 172nd Meeting of the Board of Directors of SONATEL SA of 16 February, 2017, was signed on 8 January, 2018 with retroactive effect to 25 April, 2017.

This is a cashless loan that frees the GOS from overdue credit held by SONATEL SA up to 1 million XOF, which is thus converted into a shareholder loan. The parties will agree on the terms of repayment of the remainder of the SONATEL SA credit. Modalities and effects

This shareholder loan of 1.000 million XOF at an interest rate of 7.5% per annum is granted for a period of 24 months with a grace period of 12 months in accordance with the amortization schedule.

In 2018, the loan was fully repaid and this loan generated no income.

252 Sonatel Annual Report 2018

9. Assistance Agreement with Orange (SL) Ltd Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Madame Aminata Mélina KANE Nature and object

This is a support agreement between SONATEL SA and Orange (SL) Ltd authorized at the time of the 171st Meeting of the Board of Directors of SONATEL SA of 18 September 2016, signed on 1 March 2018 with retroactive effect from 19 July 2016.

The purpose of the agreement is to determine the terms and conditions under which SONATEL will transfer know-how to Orange (SL) Ltd and will render the services to Orange (SL) Ltd in order to enable it to develop its activities in their competitive context and to sub-regional development and benefit from all the synergies available within the framework of the SONATEL Group. This agreement provides in particular for:

- a transfer of know-how from SONATEL SA in the areas of strategic planning, regulatory, financial, technical, innovation, commercial, quality and process optimization, administrative, purchasing, human resources in the field of management control, and in the area of fraud and insurance income; - permanent support services through the provision of permanent experts and the provision of all or part of its financial, commercial, technical or operational management tools and software within the limits of the telecommunications regulations and rules in Senegal and Sierra Leone; - one-off assistance services at the request of Orange (SL) Ltd.

Modalities and effects

In exchange for the transfer of know-how and personnel, Orange (SL) Ltd pays SONATEL SA a flat-rate annual fee calculated on the basis of 3% of turnover excluding tax net of the amount of management fees paid directly to Orange Group.

The services of the director will be billed 9 million XOF/ man-month.

Permanent seconded experts will be billed 7 million XOF/ man-months.

The invoicing of the temporary experts is set at 350.000 XOF/man-day excluding transport and lodging costs.

The use of SONATEL SA’s software and management tools will be billed in proportion to the resources used.

Base: (depreciation + maintenance charges) + 15%.

253 For the 2018 financial year, this agreement generated revenues for a total amount of 1,219 million XOF, which breaks down as follows:

In millions of XOF

Seconded staff 467 One-off service 24 Management fees 720 IS network 8

Total 1219

10. Assistance Agreement with Orange Mobile Finance Senegal (OFMS) Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Mrs. Ramatoulaye DIALLO SHAGAYA. Nature and object

This is an agreement authorized by the 166th session of the Board of Directors held on 14 April, 2016. It was signed on the same date between OFMS and SONATEL SA. This agreement was the subject of two amendments signed respectively on 23 December, 2016 and 22 May, 2017. This agreement and its amendment No. 1 took effect retroactively on 1st January 2016. Amendment No. 2 took effect retroactively on 1 January, 2017. Modalities and effects

All costs incurred by SONATEL for maintenance and innovation of information systems for the purposes of the Orange Money service will be billed back to OFMS. This agreement and its amendments No. 1 and No. 2 provide, inter alia, for: - a transfer of know-how from SONATEL in the following areas: - strategic planning, - financial, - technical, - commercial, - management control, - Human Resource Management, - purchases;

- management assistance services provided by SONATEL to OFMS through the provision of experts on a permanent basis;

254 Sonatel Annual Report 2018

- one-off assistance services at the request of OFMS. These include services in the following areas: - legal advice and studies, - litigation, - finances and accounting, - use of SONATEL management tools, - SONATEL’s expertise in the setting up of high-tech equipment ..., - service provision of its telephone, specialized and operating lines; - the distribution of the Orange Money product to wholesalers, - Cash in and cash out services for Orange Money customers in SONATEL SA branches - the management of the customer hotline, - assistance in the field of marketing, - Marketing the Orange Money service - maintenance and innovation of information systems and particularly the Tango via NOVA + platform. Modalities and effects

In exchange for the transfer of know-how and staff, OFMS pays SONATEL SA a fixed annual management fee calculated on the basis of 1% of OFMS’s annual tax-free turnover.

The costs of permanently seconded staff involved in the management and management of OFMS will be borne entirely by OFMS. SONATEL SA will invoice the actual gross cost of all permanently seconded staff with a margin of 15%.

The seconded experts will be billed up to 7 million XOF/man-month. The billing of the temporary experts is set at 350.000 XOF/man-day.

The services of legal advice and studies will be billed by SONATEL SA for a lump sum of 5 million XOF. In the event of recourse to external advice to SONATEL, OFMS will have to support or reimburse all fees and costs incurred by such recourse.

The assistance services in the area of litigation invoiced by SONATEL SA concern the reimbursement of the costs of lawyers, notaries and bailiffs on the production of invoices. In the event of recourse to external advice outside SONATEL, OFMS will have to bear or reimburse all fees and costs incurred by such recourse.

The management of accounting and tax activities will be billed for an annual lump sum of 20 million CFAF.

The management of purchasing and logistics activities will be invoiced annually in proportion to the resources allocated.

The management of fraud and insurance revenue activities will be invoiced for an annual lump sum of 20 million XOF.

The use of the building, the energy and security of the administrative sites will be invoiced annually according to the square meter used.

Technical and IT services will be billed annually in proportion to the resources allocated.

255 The use of the applications and the IS will be invoiced annually in proportion to the licenses operated by OFMS (base = ((depreciation + maintenance charges) +15%).

- Distributor commissions: - 0.24% for volumes ≤ 100 billion XOF, - 0.20% for volumes > 100 billion XOF

- Hotline: in proportion to the resources allocated. - Marketing assistance: in proportion to the resources allocated.

Commercial contracts may be signed between the parties and will be billed in accordance with each party’s price catalog.

A total amount of 2,775 million XOF was recorded in 2018 as part of the execution of this agreement. This amount breaks down as follows:

In millions of XOF Management fees 251 Seconded staff 321 Legal, regulatory, recovery assistance 5 Accounting and tax management 20 Management fraud and income insurance 20 Purchasing and Logistics Management 3 iS Management 278 Marketing and communication support 2.024 Distributor commissions 630 Hotline 121 Total 2775

11. Concession Renewal Agreement

Directors concerned

- Mr Thierno FALL. - Mr Abdoulaye DIOP. - Mr. Bassirou Samba NIASSE. Nature and object

An agreement was signed on 21 June, 2016 between the State of Senegal and SONATEL SA, for the renewal of the concession expiring on 8 August, 2017. This agreement also provides for 4G frequency allocation arrangements.

This agreement was previously authorized by the Board of Directors of SONATEL SA in its 167th session dated 20 June, 2016

256 Sonatel Annual Report 2018

The renewal of the concession concerns the establishment and operation of public telecommunications networks and the provision of telecommunications services for a period of 17 years, beginning on 9 August, 2017.

In addition, the State of Senegal undertakes to allocate to SONATEL SA 4G frequencies for a period of 17 years starting from the signature of the frequency allocation decision dated 3 August 2016. Modalities and effects

The renewal of the SONATEL SA concession agreement as well as the allocation of 4G frequencies are made with payment of a total amount of 100 billion XOF divided as follows:

- 68 billion XOF under the renewal of the 2G/3G fixed global license; - 20 billion XOF under the allocation of 2x10Mhz frequencies in the 1800 MHz band; - 12 billion XOF under the allocation of 2x10Mhz frequencies in the 800 MHz band; This amount is paid according to the following terms: - payment of 50 billion XOF in July 2016, after publication in the Official Gazette of the Republic of Senegal of the new versions of the Concession Agreement and of the specifications and signature of the 4G frequency allocation decision. This first installment concerns the payment of 32 billion XOF for the allocation of the 4G frequencies and the payment of 18 billion CFAF for the down payment on the renewal of the 2G/3G fixed global license; - payment of the balance of 50 billion XOF in January 2017 for the remainder of the renewal of the fixed global 2G/3G license.

The amount of the concession was paid in full by SONATEL for the previous financial years.

12. Cooperation agreement with Orange Mali Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Mr. Brelotte BA. Nature and object

This is a technical cooperation agreement signed in August 2002 between SONATEL and Orange Mali in the following areas: - transfer of know-how from SONATEL SA to Orange Mali, - Permanent assistance by SONATEL SA in the areas of management operational, technical assistance, engineering and training, - one-off assistance services at the request of Orange Mali for one-off and specific studies, - supply by SONATEL at the request of Orange Mali, technical and commercial management tools, - use by Orange Mali of new SONATEL SA software.

This agreement was the subject of two amendments signed respectively on 23 December, 2016 and 22 May, 2017. The second amendment completes the benefits provided for in the cooperation agreement and in amendment 1 signed between the parties in 2002 and 2005.

257 The third amendment was signed on 23 December, 2011, with retroactive effect on 1st January 2011, and aims to amend Article 2.2 of the agreement signed in August 2002 relating to the payment of managements fees.

In addition to the benefits already provided for in these two initial contracts, the parties agree to grant each other loans and borrowings. Modalities and effects

In consideration for the services provided, Orange Mali will pay to SONATEL SA a royalty amounting to 3% of the net turnover of the amount of the management fees paid directly to Orange SA in accordance with the contract signed between Orange SA and Orange Mali.

The services provided on a permanent basis by the seconded staff are billed at the rate of 7.5 million XOF per month and per agent for the posts of director general and director, and for 5.9 million XOF per month and per employee for other positions.

Temporary expertise missions are invoiced at the rate of 350.000 XOF per man-day.

The use of SONATEL SA’s software will be invoiced in proportion to the licenses operated by Orange Mali on the basis of a base (amortization + maintenance charges) x 15%.

Under Amendment No. 2, the amount of loans granted by a party may not exceed at the time of the loan more than 60% of the average monthly cash flow of the last 6 months.

The interest rate corresponds to the average rate on the last three DATs received by the lender benefits plus 0.25 points.

If, because of the loan under the agreement, the lender incurs a debt, the rate to be applied will be the exit rate of the said debt increased by 0.25 point.

The amounts billed by SONATEL SA for the 2018 financial year amounted overall to 8,128 million XOF and can be broken down as follows:

In millions of XOF

Annual fee 7.115 Seconded staff 373 IT 632 One-off assistance 8

Total 8128

258 Sonatel Annual Report 2018

13. Assistance agreement with the Orange Services Group Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Birago Diène Moctar BEYE Nature and object

This is a management assistance agreement for the provision of permanent experts of SONATEL SA to the Orange Services Group (GOS). This areement was validated at the 155th Meeting of the Board of Directors of SONATEL of 18 September 2014 and at the 14th Meeting of the Board of Directors of GOP SA.

The agreement was concluded for an indefinite period. It has a retroactive effect and starts running from 1st January 2014. Modalities and effects

In the case of a seconded expert, the invoicing will be.7 million XOF / month man (collaborator) and CFAF 9 million/man-month if the staff occupies the position of DG or DDG.

In the case of a temporary expert, the invoicing will be 350 000 XOF/man-day. This billing does not include travel, stay and living expenses.

In the case of other assistance services, billing must be agreed between the two parties before the actual start of the performance of the service requested.

As of 31 December, 2018, the effects produced by this agreement only concern the permanent assistance services of the experts, which amount to a total amount of 1.16 million XOF.

14. Assistance Agreement with Orange Guinea Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Mr. Aboubacar Sadikh DIOP.

259 Nature and object

This is an assistance agreement between Orange Guinea and SONATEL SA, signed on 21 June, 2007, which provides in particular:

- transfer of know-how from SONATEL SA to Orange Guinée in the areas of strategic planning, purchasing, human resources, financial, technical and commercial management control; - provision of permanent assistance by SONATEL SA with the provision of highly qualified staff, particularly to perform management functions; - one-off assistance services at the request of Orange Mali for one-off and specific studies - provision by SONATEL SA to Orange Guinée of management tools.

An amendment was signed on 23 December, 2011 with retroactive effect from 1 January, 2011 and is intended to amend Article 2.2 of the agreement signed on 21 June, 2007 relating to the payment of management fees.

Modalities and effects

In consideration for the services provided, Orange Guinée will pay SONATEL SA a royalty amounting to 3% of the net turnover of the amount of management fees paid directly to Orange SA in accordance with the contract signed between Orange SA and Orange Guinée.

As a permanent assistance service, Orange Guinée will fully support the costs of the expatriate staff made available by SONATEL and will pay an amount of 7 million XOF/man-month.

The one-off assistance services will be billed by SONATEL SA to Orange Guinea at a rate of 350,000 XOF/man-day.

The use of SONATEL SA software will be invoiced in proportion to the licenses operated by Orange Guinée on the basis of a base (amortization + maintenance charges) x 1.15.

The amount recognized in the 2018 financial year under this agreement amounts to 4,593 million XOF and is detailed as follows:

In millions of XOF

Seconded staff 354 Management fees 3.880 One-off assistance 16 IS network 343

Total 4593

260 Sonatel Annual Report 2018

15. Assistance Agreement with Orange Guinea Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Sékou DRAME. - Mr Fabrice ANDRE. - Mr Seydi Ahmed SY SARR. Nature and object

This is an assistance agreement between Orange Bissau and SONATEL SA, signed on 6 August, 2007, which provides in particular:

- Transfer of know-how from SONATEL SA to Orange Bissau in the areas of strategic planning, purchasing, human resources, financial, technical and commercial management control; - provision of permanent assistance by SONATEL SA with the provision of highly qualified staff, particularly to perform management functions; - one-off assistance services at the request of Orange Bissau for ad hoc and specific studies; - provision by SONATEL SA to Orange Bissau of management tools.

This agreement was the subject of an amendment n° 1 signed on 9 July, 2008 with the aim of modifying and deleting the terms of the agreement of 6 August, 2007 relating to the costs of permanent staff made available to Orange Bissau by SONATEL SA.

Article 2 of Addendum No.1 to the agreement specifies that SONATEL SA will invoice Orange Bissau for the actual gross cost of staff made available on a permanent basis, without applying a margin as long as its EBITDA is negative.

An amendment was signed on 23 December, 2011 with retroactive effect on 1st January 2011 and aims to amend Article 2.2 of the agreement signed on 6 August, 2007 relating to the payment of management fees. Modalities and effects

In consideration for the services provided, Orange Bissau will pay to SONATEL SA a royalty amounting to 3% of the net sales of management fees paid directly to Orange SA in accordance with the contract signed between Orange SA and Orange Bissau.

As a permanent assistance service, Orange Bissau will fully support the costs of the expatriate staff made available by SONATEL SA. SONATEL SA will invoice Orange Bissau for the actual gross cost of the personnel made available on a permanent basis, without applying a margin as long as its EBITDA is negative.

One-off assistance services will be billed by SONATEL SA to Orange Bissau at the rate of 350,000 XOF/man-day.

The use of SONATEL SA software will be billed pro rata to the licenses operated by Orange Bissau on the basis of a base (amortization + maintenance charges) x 1.15.

261 The amount recognized in the 2018 financial year under this agreement amounts to 730 million XOF and is detailed as follows:

In millions of XOF

Seconded staff 132 Management fees 481 Network and IT Management 117

Total 730

16. Support agreement with Sonatel Mobiles

Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Fabrice ANDRE. - Mr Sékou DRAME. - El Hadji Malick DARY, - Mr Ludovic Pech. Nature and object

This is an agreement signed on 21 December, 2012 (with retroactive effect from 1st September 2012) between SONATEL SA and SONATEL Mobiles. This agreement cancels and replaces the agreement signed on 23 September, 2008 as well as its amendments 1 and 2 of 11 February, 2010 and 20 July, 2010. This agreement provides in particular for:

- a transfer of know-how from SONATEL SA in the field of strategic, technical, commercial planning and control; - the transfer of SONATEL Mobiles’ staff to SONATEL SA; - management assistance services provided by SONATEL SA to SONATEL Mobiles through the availing of experts on a permanent basis; - one-off assistance services at the request of SONATEL Mobiles. These include services in the following areas: - legal, regulatory and debt recovery, - commercial, - technical and computer, - use of the management tools and software of SONATEL SA, - SONATEL’s expertise in the setting up of high-tech equipment ..., - management of the marketing and communication activity, - One Card management (prepaid cards), - management and centralization of the SONATEL Mobiles treasury by SONATEL SA, - management of accounting and tax activities, - management of purchasing and logistics activities, - management of roaming and interconnection activities, - various services (use of the sites, materials, energy ...).

262 Sonatel Annual Report 2018

This agreement was the subject of an addendum authorized by the Board of Directors of SONATEL SA of 19 April, 2014. The purpose of this addendum is to complete the billing arrangements for a service provided for in the assistance agreement. Modalities and effects

In exchange for the transfer of know-how and personnel, SONATEL Mobiles pays SONATEL SA a fixed annual fee calculated on the basis of 5% of the annual turnover.

The costs of permanently seconded staff involved in the management and management of SONATEL Mobiles will be borne entirely by SONATEL Mobiles.

Permanent seconded experts will be invoiced for 7 millionXOF/man-months. The invoicing of the temporary experts is established at 350.000 XOF/man-day.

Legal, regulatory and recovery services will be billed by SONATEL SA for a lump sum of 250 million XOF.

Distributions of recharge cards and SIM cards will be invoiced respectively 4% and 10% of the turnover achieved with the distributors.

The parties agree that SONATEL SA will re-invoice SONATEL Mobiles on an annual basis and will follow the shared management of the technical network: (shared equipment depreciation + shared equipment maintenance charges + shared staff costs) x 1.15.

The use of SONATEL SA’s management software and tools (Oracle and Decisional, etc.) will be invoiced in proportion to the resources used.

Under the management of its marketing and communication activities, SONATEL SA will charge SONATEL Mobiles an annual lump sum equal to 1% of SONATEL Mobiles’ annual turnover outside the Group. SONATEL Mobiles will rebill the communication costs (including advertising taxes) paid on behalf of SONATEL SA. The advertising tax will be rebilled pro rata of the turnover of the year N (excluding whole sale turnover).

The parties agree that SONATEL Mobiles will take over the services of the outsourced technical hotline. It will invoice SONATEL SA for its share.

Under One Card management (prepaid cards), purchasing management expenses are borne and recognized by SONATEL Mobiles. The purchase management costs for these cards will be re- invoiced using the following method: number of cards used on the fixed fee x average management unit (CUMP) services of the previous fiscal year.

SONATEL Mobiles will return to SONATEL SA the share of revenue accruing to SONATEL SA. For the management and centralization by SONATEL SA of SONATEL Mobiles’ cash flow: - the receipts in the counters of SONATEL SA and their posting will be invoiced by SONATEL SA to SONATEL Mobiles at 2% of the total amount collected; - the loans granted and loans granted mutually will be remunerated at a rate defined according to the nature of the loan. Fees generated by transactions on SONATEL SA’s bank accounts on behalf of SONATEL Mobiles will be re-invoiced in proportion to the transactions carried out; - a remuneration of the current accounts will be paid by SONATEL Mobiles according to the amount of the surpluses and overdrafts of SONATEL Mobiles.

The management of accounting and tax activities will be invoiced for an annual lump sum of 623 million XOF.

263 The management of purchasing and logistics activities will be billed for an annual lump sum of 300 million XOF.

The management of roaming and interconnection activities will be billed for an annual lump sum of 50 million XOF.

4G license fees will also be billed to SONATEL Mobiles.

For the 2018 financial year, this agreement generated revenue for a total amount of 41.174 million XOF, which breaks down as follows:

In millions of XOF

Management fees 15978 Seconded expert - Temporary expert - Cashing counters 538 Marketing and communication: - Annual fee 3163 - Communication costs - Advertising tax 314 One Card Management: - Card management cost 11 - SONATEL turnover share 169 Legal, regulatory, recovery 250 Distribution of recharge cards and SIM cards 8778 Technical and IT management 870 Network management 6543 Use of software - ACL hotline management 1929 - Roaming and interconnection 50 Accounting and taxation 623 Purchasing and logistics 300 4G fees 2165 LT License 2X10 143

Total 41174

17. Cooperation agreement with Sonatel Multimedia Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Fabrice ANDRE. - Mr Omar Guèye NDIAYE

264 Sonatel Annual Report 2018

Nature and object

This is a technical assistance agreement signed on 21 December 2012 (with retroactive effect from 1 September 2012) between SONATEL SA and SONATEL Multimédia. This agreement cancels and replaces the agreement signed on 17 December, 2007 and its amendments 1, 2 and 3 of 3 March, 2009, 15 October, 2009 and 11 February, 2010. This agreement provides in particular for:

- a transfer of know-how from SONATEL SA in the areas of strategic, technical, commercial planning and management control; - one-off assistance services (legal advice and studies, assistance in the litigation field, collection of receivables, marketing of services, use of management tools, vehicles and expertise of SONATEL SA, rental of buildings, accommodation in technical premises, service supplies, telephone hotline management, marketing and communication activities, technical and IT activity, cash management and centralization, purchasing, accounting and tax management, single billing management). Modalities and effects

In return for the transfer of know-how, SONATEL Multimédia pays SONATEL SA a management fee of 1% of the annual turnover excluding taxes.

For assistance with legal advice and study, SONATEL SA invoices an annual lump sum of 5 million XOF excluding taxes.

For assistance in the field of litigation, SONATEL SA invoices a fixed annual amount of 5 million XOF excluding taxes.

In exchange for accounting, treasury, purchasing, inventory and tax management, SONATEL SA invoices a fixed annual amount of 200 million XOF excluding taxes.

SONATEL Multimedia also pays: - 2% of invoiced amounts received by SONATEL SA; - a commission of 20% of ADSL access fees and 15% for professional solutions; - an annual fee of 260 million CFAF for technical and IT activity; - for the marketing and communication business, an annual fee equal to 1% of the annual turnover outside the Group; - 350,000 XOF per expert and per day; - for single invoicing, an amount equal in the proportion of resources used and 3% of the amount billed for services; - for the use of management tools (Oracle, ...), an amount equal to the proportion of resources committed; - for the management of the hotline, an amount equal to the proportion of resources used; - for the costs of communication on the Internet, an amount equal to the share of the SONATEL Multimedia base on the global fixed network

The amortization of SONATEL SA vehicles used by SONATEL Multimédia will be re-invoiced in proportion to the use by each entity.

265 In fiscal year 2018, this agreement generated royalties amounting to 1,552 million XOF, broken down as follows:

In millions of XOF

Management fees 127 Legal advice and studies 5

Accounting, cash, purchases, stocks, taxation 200 Marketing of products 83 Management Tools (Oracle ...) - Hotline management 201 - technical and IT, 260 Marketing and communication : 91 Vehicle use Single billing 237 Litigation 5 Receivables collected 126 iS mutualization 214 ACL Hotline Mutualization 3 Total 1552

18. Cooperation agreement with Sonatel Business Solutions Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr Fabrice ANDRE. - Mrs. Diariétou Madina DIENG. Nature and object

This is a technical assistance agreement between SONATEL SA and SONATEL Business Solutions signed on 28 December, 2015 with retroactive effect from 8 June, 2015 and which provides in particular: - a transfer of know-how between SONATEL SA and SONATEL Business Solutions; - permanent technical assistance with the provision of permanent experts who will participate in the steering and management of the company and subsidiaries; - one-off assistance for the resolution of problems related to its organization (legal advice and studies, assistance in the litigation field, collection of receivables, finance and accounting, use of SONATEL SA management tools, use of the expertise of SONATEL SA, supplies of services, rental of equipment); - management and centralization by SONATEL SA of the cash flow of SONATEL Business Solutions; - management of accounting and tax activities.

266 Sonatel Annual Report 2018

Modalities and effects

In return for the transfer of know-how, SONATEL Business Solutions undertakes to pay SONATEL SA an annual fee equal to 1.5% of its turnover excluding taxes from the second year of operation.

Permanent seconded experts are billed at actual cost plus a 15% margin. The billing of temporary experts is 350,000 XOF/man-day.

The services of legal advice and studies are billed by SONATEL SA for an annual lump sum of 5 million XOF.

Assistance in the litigation area is billed on the production of invoices at the actual cost of attorneys, notaries and bailiffs.

SONATEL SA will assist SONATEL Business Solutions in carrying out certain accounting or financial management tasks whenever the latter makes the request.

The use of the management tools of SONATEL SA is invoiced in proportion to the licenses used by SONATEL Business Solutions (Base = (amount of depreciation + maintenance charges) * 15%).

Service supplies are invoiced in accordance with SONATEL SA’s price list for products and services.

The equipment rental of SONATEL SA to SONATEL Business Solutions is invoiced according to the following terms: [(cost of acquisition before tax/amortization period in days) x number of days of loan] x 1.15.

The amounts recognized by SONATEL SA in respect of the 2018 financial year under this agreement amount to 801 million XOF and are detailed as follows:

In millions of XOF

Accounting Assistance 38 Management fees 109

Seconded staff 589 Legal assistance 5 IT management 40 Security guards 20

Total 801

267 19. License Agreement for the use of the Orange Brand Directors concerned

- Mr Bruno METTLING. - Mr Thierry BRETON. - Mr Ludovic Pech. - Mr Fabrice ANDRE. - Mr Thierry MARIGNY. - Mrs. Fatoumata Sarr DIENG. Nature and object

These are Orange brand licensing agreements between Orange Brand Services Limited, Orange SA and SONATEL SA.

These agreements, applicable from the 2007 financial year, were the subject of an amendment n° 1 signed on 9 April, 2008 and provide in particular for: - the granting by Orange Brand Services Limited of a non-exclusive license to use the «Orange» Brand, - an authorization to manage and operate the Orange brand internationally, including the right to sublicense the use of the Orange brand in their territory, - pre-launch support and brand renaming support by Orange Brand Services Limited, - support services in terms of marketing and communication in the form of know-how, training, assistance, brand expertise and other information and/or advice to help SONATEL SA and its subsidiaries. Modalities and effects

SONATEL SA undertakes to pay Orange Brand Services Limited, or any other entity designated by it, an annual fee equal to 1.6% of the pre-tax turnover of the activities marketed under the «Orange» brand.

The effect of this agreement for the 2018 financial year is 12 million XOF.

20. Participation Contract Directors, Directors General, Deputy Directors General or shareholders concerned

- Mr. Alioune NDIAYE. - Mr. Thierry BRETON. - Mr. Ludovic Pech. - Mr. Jérôme HENIQUE. - Mr. Thierry MARIGNY. - Mr. Hugues FOULON.

268 Sonatel Annual Report 2018

Nature and object

This is a contract signed on 31 March, 2012, between JV (BUYIN SA company), NatCo (SONATEL SA, SONATEL Multimedia, SONATEL Mobiles and SONATEL Business Solutions) and Orange SA.

The purpose of this contract is to lay down the general terms and conditions of collaboration between JV and NatCo concerning the purchasing activities included in the scope of JV.

The scope of JV procurement activities includes: - network technology, - customer equipment, - service platforms ... Modalities and effects

This collaboration is done without any financial compensation

* * * Reimbursement of Directors’ expenses

Pursuant to Article 432 of the OHADA Uniform Act on the Law of Commercial Companies and Economic Interest Grouping, the Board of Directors of SONATEL SA, at its meetings of 9 April, 2008 and 13 December, October 2009, authorized the reimbursement of hotel expenses and travel expenses of directors between their normal place of work and the location of Board meetings or meetings of Board Committees.

For fiscal year 2018, no reimbursement of expenses was made to the Directors.

The Auditors

GARECGO RACINE MEMBER OF THE JPA NETWORK MEMBER OF ERNST INTERNATIONAL & YOUNG

Mamour FALL, Partner Makha SY, Partner

22 March, 2019

269 AGENDA OF THE ORDINARY GENERAL MEETING OF SONATEL OF WEDNESDAY, 17 APRIL 2019.

1. Review and approval of the financial statements of the year ended 31 December, 2018, 2. Appropriation of profit for the year 2018, 3. Ratification of the cooptation of Mr Hugues FOULON, 4. Ratification of the cooptation of Mr Alioune NDIAYE, 5. Ratification of the cooptation of Mr Hugues FOULON, 6. Ratification of the cooptation of Mr Hugues FOULON, 7. Renewal of the term of office of Mr. Bassirou Samba NIASSE as director 8. Renewal of the term of office of Mr Hugues FOULON as director 9. Renewal of the term of office of Mr Koly FAYE as director 10. Renewal of the term of office of Mr Abdoulaye DIOP as director 11. Approval of regulated agreements: - Loan agreement signed with ORANGE Guinea, - 03 loan contracts signed with ORANGE Sierra Leone. 12. Powers for the completion of formalities

270 Sonatel Annual Report 2018

Draft resolution 1: Review and approval of Financial Statements for the year ended 31 December, 2018

The General Meeting, having heard the reading of:

1. the Report of the Board of Directors on the Company’s activities during the year ended 31 December, 2018 and the accounts for the said financial year, 2. the Auditors General Report on the financial statements for this financial year,

Approves the financial statements of SONATEL for the year ended 31 December, 2018 as presented and the transactions reflected in these accounts and summarized in these Reports.

Accordingly, taking note of the Auditors General Report, the Ordinary General Meeting grant full and unreserved discharge to the Directors and the Auditors for the execution of their mandate for the financial year ended 31 December, 2018.

Draft resolution 2: Appropriation of profit for the year 2018.

The General Meeting, approving the proposal of the Board of Directors, notes the existence of a profit of 106,939,462,716 CFAF and decides to allocate as dividends the entire profit for the year ended 31 December 2018.

Further, it decides to take 59,727,203,951 XOF from the free reserves to be distributed in dividends.

As a result, the Ordinary General Meeting sets at 1.667 XOF the gross dividend for each share. After deducting the withholding tax of 10% under the IRVM, the net dividend of 1,500 XOF per share will be paid as of 14 May, 2019.

Draft resolution 3: Ratification of the cooptation of Mr. Hugues FOULON.

On the proposal of the Board of Directors and after having deliberated, the General Meeting decides to ratify the cooptation of Mr. Hugues FOULON, co-opted at the meeting of the Board of Directors of 17 April, 2018 to replace Mrs. Fatoumata SARR DIENG, resigned.

Following this cooptation, Mr. Hugues FOULON will retain his mandate for the remaining period of his predecessor’s term of office until the Ordinary General Meeting which will decide in 2019 on the financial statements for the year ended 31 December, 2018.

271 Draft resolution 4: Ratification of the cooptation of Mr. Alioune NDIAYE.

On the proposal of the Board of Directors and after having deliberated, the General Meeting decides to ratify the cooptation of Mr. Alioune NDIAYE co-opted at the meeting of the Board of Directors of 17 April, 2018 to replace Mr Bruno METTLING, resigned.

Following this cooptation, Mr. Alioune NDIAYE will retain his mandate for the remaining period of his predecessor’s term of office until the Ordinary General Meeting which will decide in 2021 on the financial statements for the year ended 31 December, 2020.

Draft resolution 5: Ratification of the cooptation of Mr. Koly FAYE.

On the proposal of the Board of Directors and after deliberating, the General Meeting decides to ratify the co-optation of Mr. Koly FAYE, co-opted at the meeting of the Board of Directors of 06 August 2018 to replace Mr. Thierno FALL, resigned.

Following this cooptation, Mr. Koly FAYE will retain his mandate for the remaining term of office of his predecessor until the Ordinary General Meeting which will decide in 2019 on the financial statements for the year ended 31 December, 2018.

Draft resolution 6: Ratification of the cooptation of Mr. Jérome HENIQUE.

On the proposal of the Board of Directors and after deliberating, the General Meeting decides to ratify the co-optation of Mr. Jérôme HENIQUE co-opted at the meeting of the Board of Directors of 06 August 2018 to replace Mr. Fabrice ANDRE, resigned.

Following this cooptation, Mr. Jérôme HENIQUE will retain his mandate for the remaining term of his predecessor’s term of office until the Ordinary General Meeting which will decide in 2021 on the financial statements for the year ended 31 December, 2020.

Draft resolution 7: Renewal of the term of Mr. Hugues FOULON as director.

The General Meeting notes that the term of Mr. Hugues FOULON expires at the end of this Ordinary General Meeting.

It decides to renew the term of Mr. Hugues FOULON for a period of three (3) years which will expire at the end of the Ordinary General Meeting which will decide in 2022 on the financial statements for the financial year ended 31 December, 2021.

Mr Hugues FOULON, whose term has been renewed, declares that he accepts this renewal and specifies that he is not subject to any incompatibility or prohibition likely to prevent him from exercising the functions of director.

272 Sonatel Annual Report 2018

Draft resolution 8: Renewal of the term of Mr. Koly FAYE as director.

The General Meeting notes that the term of office of Mr Koly FAYE expires at the end of this Ordinary General Meeting.

It decides to renew the mandate of Mr. Koly FAYE for a period of three (3) years which will expire at the end of the Ordinary General Meeting which will rule in 2022 on the financial statements for the year ended December 31, 2021.

Mr Koly FAYE whose term has been renewed declares that he accepts this renewal and specifies that he is not subject to any incompatibility or prohibition likely to prevent him from exercising the functions of director.

Draft resolution 9: Renewal of the term of Mr. Abdoulaye DIOP as director.

The General Meeting notes that the term of Mr. Abdoulaye DIOP expires at the end of this Ordinary General Meeting.

It decides to renew the mandate of Mr Abdoulaye DIOP for a period of three (3) years which will expire at the end of the Ordinary General Meeting which will decide in 2022 on the financial statements for the year ended 31 December, 2021.

Mr Abdoulaye DIOP whose term has been renewed declares that he accepts this renewal and specifies that he is not subject to any incompatibility or prohibition likely to prevent him from exercising the functions of director.

Draft resolution 10: Renewal of the term Mr. Bassirou Samba NIASSE as director.

The General Meeting notes that the term of office of Mr. Bassirou Samba NIASSE expires at the end of this Ordinary General Meeting.

It decides to renew the term of Mr. Bassirou Samba NIASSE for a period of three (3) years which will expire at the end of the Ordinary General Meeting which will rule in 2022 on the financial statements for the financial year ended 31 December, 2021.

Mr. Bassirou Samba NIASSE, whose term has been renewed, declares that he accepts this renewal and specifies that he is not subject to any incompatibility or prohibition likely to prevent him from exercising the functions of director.

273 Draft resolution 11: Approval of regulated agreements.

After having heard the reading of the Special Report of the Auditors on the agreements referred to in Articles 438 et seq. of the OHADA Uniform Act on the Law of Commercial Companies and the Economic Interest Groups, the Ordinary General Meeting approves the following agreements:

- Loan agreement signed with ORANGE Guinea, - 03 loan contracts signed with ORANGE Sierra Leone.

Draft resolution 12: Powers for the completion of formalities.

The General Meeting confers full powers on the bearer of originals, copies or extracts of these resolutions in order to complete all the formalities prescribed by law.

274 www.sonatel.com