Directors’ Report 163 Significant Accounting Policies 169 Income Statements 177 Balance Sheets 178 Consolidated Statement of REPORTS AND Changes in Equity 179 FINANCIAL STATEMENTS Company Statement of 162 Changes in Equity 180 TELEKOM MALAYSIA BERHAD Annual Report 2003 Cash Flow Statements 181 Notes to the Financial Statements 182 Statement by Directors 249 Statutory Declaration 249 Report of the Auditors 250 General Information 251 .Sincetheendofpreviousyear, thedividendspaid,declaredorproposedbyCompanyareasfollows: 5. DIVIDENDS 4. TheresultsoftheoperationsGroupandCompanyforyearwere as follows: 3. RESULTS TheprincipalactivitiesoftheCompanyduringyearareestablishment,maintenanceandprovisiontelecommunication 2. PRINCIPAL ACTIVITIES 1. ENDED YEAR THE FOR DIRECTORS’ REPORT a Inrespectoftheyearended 31December2002,afinalgrossdividendof10.0sen (a) the financialstatements. substantially affectedbyanyitem,transactionoreventofamaterialandunusualnatureotherthanasdisclosedinnote42to In theopinionofDirectors,resultsoperationsGroupandCompanyduringyearwerenot activities duringtheyear. of thesubsidiariesaresetoutinnote43tofinancialstatements.Therewasnosignificantchangenaturethese underthelicenceissuedbyMinisterofEnergy,and relatedservices CommunicationsandMultimedia.Theprincipalactivitie Company fortheyearended31December2003. The DirectorshavepleasureinsubmittingtheirannualreportandtheauditedfinancialstatementsofGroup rftfrteya trbtbet hrhles1304529.0 1,390.4 Profit fortheyearattributabletoshareholders b TheDirectorsnowrecommendafinalgrossdividendof10.0senpersharelesstax28%(2002: 10.0senpershareless (b) Minority interests Profit aftertaxation nraedet xrieo hr pin 0.4 228.0 – increaseduetoexercise ofshareoptions – amountasproposedintheDirectors’Reportforthatyear per sharelesstaxof28%waspaidon23June2003 approval attheforthcomingAnnual GeneralMeetingoftheCompany. tax of28%)andaspecialgrossdividend10.0senpershareless taxof28%(2002:Nil)subjecttotheshareholders’ 31 D ECEMBER 2003 H RU THECOMPANY THE GROUP MmlinRMmillion RM million ,4. 529.0 1,444.2 5.)— (53.8) RM million 228.4 s

163 164 .Duringtheyear, theissuedandfullypaid-upsharecapitalofCompany wasincreasedbytheissuanceof83,725,000ordina 8. 7. SHARE CAPITAL 6. EMPLOYEES’ SHAREOPTIONSCHEME ENDED YEAR THE FOR DIRECTORS’ REPORT azhYcbCifEeuieOfcr MFclte d.Bd*1800Nil sharesoftheCompany.with theexistingissuedordinary exercised shares ofRM1eachattheoption price ofRM7.09pershareforcashunderESOS3.Thesesharesrank pari-passuinallrespects Nil Nil 108,000 granted Preference SharesofRM0.01each and1,000ClassBRedeemablePreferenceSharesofRM0.01each. 108,000 On 31March 2003,theauthorisedsharecapital oftheCompanyhasbeenincreasedtoinclude1,000Class ARedeemable 42,000 120,000 ChiefExecutiveOfficer, TMFacilitiesSdn.Bhd.* Nil 108,000 2004andhence theremainingunexercised ThisemployeehadresignedfromtheGroupwitheffect1January options ChiefExecutiveOfficer, TMNet Sdn.Bhd.* ** 10,000 120,000 VicePresident,CorporateStrategy&Planning,TM * EmployeesofTM,secondedtorespectivesubsidiaries/associate TM –Telekom MalaysiaBerhad SeniorVicePresident,MajorBusiness&Government, 120,000 Hamzah Yacob ChiefFinancialOfficer, TMTelCo Dato’ BaharumSalleh Nil Abdul MajidAbdullah TMTelCo SeniorVicePresident,NetworkServices, Dato’ AdnanRofiee Designation 120,000 T ChiefOperatingOfficer, TMTelCo Mohd Yahaya MohdShariff Hj. HamisHasan T Y Dato’ Dr. IdrisIbrahim Chief,GroupBusinessRestructuringand Dato’ Dr. Ir. MohamadKhirHarun Name were grantedmorethan100,000optionseachunderESOS3areasfollows: Other thantheDirectors’optionsdisclosedinparagraph18below, thelistofemployeesCompanyanditssubsidiarieswh were grantedoptionsofabove100,000shareseach. holders andtheirholdingspursuanttoSection169(11)oftheCompaniesAct,1965,exceptforinformationemployeeswho The CompanyhasbeengrantedexemptionbytheCompaniesCommissionofMalaysiafromhavingtodiscloselistoption any righttoparticipateinshareissueofothercompany. share underESOS3remainedunexercised. Theseoptionsremaininforce until31July2007.Theseoptionsgranteddonotconfer sharesofRM1eachattheoptionpriceRM7.09per As at31December2003,optionstosubscribefor170,456,000ordinary The principalfeaturesofESOS3areasdisclosedinnote10(e)tothefinancialstatements. granted toeligibleExecutivesandNon-ExecutivesoftheCompanyitssubsidiariesatanexercise priceofRM7.09pershare. sharesofRM1eachunderESOS3were held on21May2002.On1August2002,optionstosubscribefor259,042,000ordinary GeneralMeeting The existingEmployees’ShareOptionScheme3(ESOS3)wasapprovedbytheshareholdersatanExtraordinary we la iePeiet ewr eeomn,T eC 2,0 Nil Nil 120,000 120,000 VicePresident,Network Development,TMTelCo ChiefStrategyOfficer, Telkom SALimited* owfek Elias an ChianKhai sfApa ehl*CifEeuieOfcr ASBra 2,0 48,000 120,000 ChiefExecutiveOfficer, VADS Berhad usof AmpuanKechil** had lapsed 31 D ECEMBER 2003 MTlo 0,0 Nil 108,000 TM TelCo Coordination, TM o fotosNo.ofshares No. ofoptions ry o 2 Atthedate ofthisreport,theDirectorsarenotawareanycircumstances which: 12. BeforethefinancialstatementsofGroupandCompanywere prepared, theDirectorstookreasonablestepsto: 11. O orprovisions duringtheyearhavebeendisclosedinfinancialstatements. Allmaterialtransferstoorfromreserves 10. MOVEMENTS ONRESERVESANDPROVISIONS On12December2003,theCompanyissuedforcash1,000ClassARedeemablePreferenceShares(RPS)(TMRPSA)and 9. REDEEMABLE PREFERENCESHARESANDUNSECUREDBONDS THER STATUTORY INFORMATION b havearisenwhichrenderadherencetotheexistingmethodof valuation ofassetsorliabilitiestheGroupand (b) (a) courseofbusiness ensurethatanycurrentassetswhichwereunlikelytoberealisedattheirbookvalueinthe ordinary (b) ascertainthatactions hadbeentakeninrelationtothewritingoffofbaddebtsandmakingallowancefordoubtful (a) Details ofTMRPSA,B,bondsandTekad Mercu bondsaresetoutinnote14tothefinancialstatements. to investorson30December2003financethesubscriptionofRUSBRPS. RM1,000.0 millionnominalvalue15-yearredeemableunsecuredbondsdue2018(collectivelyreferredtoasTekad Mercu bonds) T purpose entityoftheCompany. by RUSBvidetheissuanceofRM2,987.0millionRPS(RUSBRPS)toTekad Mercu Berhad(Tekad Mercu), anotherspecial As partofanoverallcostefficientfundingstructure,thefundsforsubscriptionCompany’s RPSandbondswererais RM1,000.0millionnominalvalue15-yearredeemableunsecuredbondsdue2018. RM1,983.5millionnominalvalue10-yearredeemableunsecuredbondsdue2013;and (ii) (i) Subsequently, on30December2003,theCompanyissuedfollowingbonds(collectivelyreferredtoasTMbonds)RUSB: B havebeenclassifiedasliabilities. of theCompanyinadistributioncapitaleventwindinguporliquidationCompany. TMRPSAand shares TM RPSAandBrankpari-passuamongstthemselvesbutbelowtheSpecialShareaheadofordinary each overtheparvalueofRM0.01each. Class BRPS(TMB)toRebungUtamaSdn.Bhd.(RUSB),aspecialpurposeentityoftheCompany, atapremiumofRM0.99 ekad Mercu had,inturn,issuedRM2,000.0millionnominalvalue10-yearredeemableunsecuredbondsdue2013and Company misleadingorinappropriate. in thefinancialstatementsofGroupandCompanymisleading; and statements oftheGroupandCompanyinadequatetoanysubstantial extentorthevaluesattributedtocurrentassets would rendertheamountswrittenoffforbaddebtsoramount ofallowancefordoubtfuldebtsinthefinancial had beenwrittendowntotheirexpectedrealisablevalues. for doubtfuldebts;and debts andsatisfiedthemselvesthatallknownbadhadbeen written offandthatadequateallowancehadbeenmade ed

165 166 7 Inaccordance withArticle103oftheCompany'sArticlesAssociation,followingDirectorsretirefromBoardatth 17. TheDirectorsinofficesincethedateoflastreportareasfollows: 16. DIRECTORS NocontingentorotherliabilityofanycompanyintheGrouphasbecomeenforceable orislikelytobecomeenforceable withi 14. betweentheendofyearanddatethisreport: Intheinterval 13. O ENDED YEAR THE FOR DIRECTORS’ REPORT 5 Atthedateofthisreport,Directorsarenotawareanycircumstances dealtwithinthisreportorthe nototherwise 15. THER STATUTORY INFORMATION (continued) T Rosli binMan Dato’ LimKhengGuan Dato’SuriahbintiAbdRahman AlternateDirectors Ir. PrabaharN.K.Singam Datuk Dr. HalimbinShafie Dato’ AbdulMajidbinHajiHussein T MohammadZanudinbinAhmadRasidi Nineteenth AnnualGeneralMeetingandbeingeligibleofferthemselves forre-election: T Rosli binMan Dato’ LimKhengGuan Ir. PrabaharN.K.Singam Y Dato’ Dr. MohdMunirbinAbdulMajid Y Datuk Dr. HalimbinShafie Dato’ AbdulMajidbinHajiHussein Dato’ Dr. AbdulRahimbinHajiDaud Dato’ Dr. MdKhirbinAbdulRahman T Directors nochargehasarisenontheassetsofanycompanyinGroupwhichsecuresliabilityotherpersonnor (b) noitems,transactionsorothereventsofmaterialandunusualnaturehasarisenwhich,in theopinionofDirectors, (a) the periodoftwelvemonthsafterendyearwhich,inopinionDirectors,willormayaffectability statements oftheGroupandCompany, whichwouldrenderanyamountstatedinthefinancialstatementsmisleading. Group oroftheCompanytomeettheirobligationswhentheyfalldue. an PohKeat an SriDato’Ir. MuhammadRadzibinHajiMansor an PohKeat an SriDato’Ir. MuhammadRadzibinHajiMansor .B. Dato’Ir. HajiMohdZinbinMohamed .B. Dato’JosephSalangGandum any contingentliabilityarisenincompanytheGroup. is made;and would substantiallyaffecttheresultsofoperationsGroupandCompanyforyearinwhichthisreport 31 D ECEMBER 2003 financial

the n e 8 InaccordancewiththeRegisterofDirectors'Shareholdings,Directorswhoheldofficeatendyearhaveinter 18. DIRECTORS’ INTEREST neeti h opn ..03Buh od31.12.2003 Sold Bought 1.1.2003 Y Dato’ Dr. AbdulRahimbinHajiDaud Dato’ Dr. MdKhirbinAbdulRahman T Interest intheCompany shares andoptionsoverintheCompanysubsidiariesareasfollows: ao r bu ai i aiDu 000—2,0#— 20,000# 10,000 31.12.2003 — — Sold 10,000 20,000 — 10,000 Bought — — acquisition 31.12.2003 10,000 Sold — acquisitionundertakenby TelekomShares soldpursuantto compulsory — # EnterpriseSdn. Bhd.,detailsasdescribedinnote 2to Bought T Dato’ Dr. 10,000 AbdulRahimbinHajiDaud 103,000 108,000 1.1.2003 10,000 Interest inCelcom(Malaysia)Berhad 68,000 70,000 — — T Dato’ LimKhengGuan 171,000 Dato’ Dr. MohdMunirbinAbdulMajid 178,000 Y Dato’ Dr. AbdulRahimbinHajiDaud T Interest inVADS Berhad Dato’ Dr. AbdulRahimbinHajiDaud Dato’ Dr. MdKhirbinAbdulRahman * Optionsexercised duringtheyear T an SriDato’Ir. MuhammadRadzibinHajiMansor nPhKa 200—2,0#— 22,000# — 10,000 22,000 — — 10,000 11,000 — an PohKeat — 11,000 an PohKeat an SriDato’Ir. MuhammadRadzibinHajiMansor an PohKeat .B. Dato’JosephSalangGandum B ao oehSln adm1,0 10,000 — — 10,000 .B. Dato’JosephSalangGandum iet1350——123,500 — — 123,500 – Direct iet9,0 800 165,000 70,000 — — 68,000* 70,000* 97,000 — – Direct – Direct iet1,0 15,000 15,000 — — — 1,500 — 15,000 — 15,000 — 1,500 – Direct – Indirect(sharesheldbyspouse) – Direct the financialstatements h aeo Balanceat the dateof aac tBalanceat Balance at Balance at Balanceat Balanceat Balance at Balance at Number of options over ordinary sharesofRM1each Number ofoptionsoverordinary ..03GatdEecsd31.12.2003 Exercised Granted 1.1.2003 Number of ordinary sharesofRM1each Number ofordinary Number of ordinary sharesofRM1each Number ofordinary sharesofRM1each Number ofordinary est in

167 168 1 NeitherduringnorattheendofyearwasCompanyoranyitsrelatedcorporations, apartytoanyarrangementwit 21. Chief Executive DATO’ DR.MDKHIRBINABDULRAHMAN Chairman T 2004. In accordancewitharesolutionoftheBoardDirectorsdated26February Theauditors,PricewaterhouseCoopers,haveexpressedtheirwillingness tocontinueinoffice. 22. AUDITORS Sincetheendofpreviousyear, noneoftheDirectorshavereceivedorbecomeentitledtoreceiveanybenefit(exceptfo 20. DIRECTORS’ BENEFITS InaccordancewiththeRegisterofDirectors’Shareholdings,noneotherDirectorswhoheldofficeatendy 19. DIRECTORS’ INTEREST(continued) ENDED YEAR THE FOR DIRECTORS’ REPORT AN SRIDATO’ Ir. MUHAMMADRADZIBINHAJIMANSOR or anyotherbodycorporate,thanoptionsgrantedtotheDirectorspursuantESOS3. the object(s)ofenablingDirectorstoacquirebenefitsbymeansacquisitionsharesin,ordebenturesComp of thecontractreferredtoinnote33financialstatements. which hehasasubstantialfinancialinterestandanybenefitthatmaydeemedtohavebeenreceivedbycertainDirectorinresp made bytheCompanyorarelatedcorporationwithDirectorfirmofwhichheismembercompanyin Directors’ fees,remunerationandotheremolumentsasdisclosedinnote4tothefinancialstatements)byreasonofacontract have anydirectorindirectinterestsinthesharesCompanyanditsrelatedcorporationsduringyear. 31 D ECEMBER 2003 r the any ear ect h .BASISOFCONSOLIDATION 2. BASISOFPREPARATION OFTHEFINANCIALSTATEMENTS 1. stated. financial statements,unlessotherwise The followingaccountingpolicieshavebeenusedconsistentlyindealingwithitemswhichareconsideredmaterialrelationt ENDED YEAR THE FOR SIGNIFICANT ACCOUNTINGPOLICIES events andactions,actualresultscoulddifferfromthoseestimates. of revenueandexpensesduringthereportedperiod.AlthoughtheseestimatesarebasedonDirectors’bestknowledgecurrent and liabilitiesdisclosureofcontingentassetsatthedatefinancialstatements,reporteda provisions oftheCompaniesAct,1965requiresuseestimatesandassumptionsthataffectreportedamountsassets The preparationoffinancialstatementsinconformitywiththeapplicableapprovedaccountingstandardsMalaysiaand was alreadyfollowingtherecognitionandmeasurementprinciplesinthosestandards. Other thantheabove,therewerenochangesinaccountingpoliciesthataffectnetprofitandshareholders’equityasGroup to thefinancialstatements. been adjustedtotakeintoaccounttheeffectofchangeinaccountingpolicywithrespectgoodwillasshownnote42 the requirementsofMASB25and29asshowninnote424tofinancialstatements.Comparativeshavealso Comparative figureshavebeenadjustedorextendedtoconformwithchangesinpoliciesand/orpresentationaccordance intangible assets,detailsofwhicharedescribedinnote4SignificantAccountingPolicies. presentation inlinewithcurrentacceptedaccountingpractices,andadoptedanewpolicyrespecttoother In additiontotheabove,duringyear, theGroupchangeditsexistingaccountingpolicywithrespecttogoodwillforfairer Companies Act,1965.Thenewapplicableapprovedaccountingstandardsadoptedinthesefinancialstatementsareasfollows: The financialstatementscomplywiththeapplicableapprovedaccountingstandardsinMalaysiaandprovisionsof disclosed intheSignificantAccountingPoliciesbelow. The financialstatementsoftheGroupandCompanyhavebeenpreparedunderhistoricalcostconventionexceptas the acquiree.Separate disclosureismadeofminority interest. Minority interest is measuredattheminorities’share ofthepostacquisitionfairvalues oftheidentifiableassetsand liabi acquired atthedateofacquisition isreflectedasgoodwill. The differencebetweenthecostof acquisitionovertheGroup’s shareofthefairvalueidentifiablenetassets ofthesubsi the fairvalueofsubsidiary’s netassetsisdeterminedandthesevaluesarereflected intheconsolidatedfinancialstatem date ofacquisitiongivenbytheacquirer, togetherwithdirectly attributableexpensesoftheacquisition.Atdateacqu of theirdisposal.Thecostacquisitionistheamountcashpaid andthefairvalueofotherpurchase considerationatthe disposed duringtheyearareincludedinConsolidatedIncome Statement fromthedateoftheiracquisitionorupto Subsidiaries areconsolidatedusingtheacquisitionmethodofaccounting wherebytheresultsofsubsidiariesacquiredor to exercise controloverthefinancialandoperatingpoliciessoastoobtainbenefits fromtheiractivities. of theyear. Subsidiariesarethosecorporationsorotherentities(includingspecialpurposeentities) inwhichtheGrouphas The consolidatedfinancialstatementsincludethe oftheCompanyandallitssubsidiariesmadeuptoe – MASB29“EmployeeBenefits” – MASB28“DiscontinuingOperations” – MASB27“BorrowingCosts” – MASB25“IncomeTaxes” 31 DECEMBER 2003 mounts lities of isition, power o the diary ents. nd

169 170 .INTANGIBLE ASSETS 4. ASSOCIATES 3. BASISOFCONSOLIDATION (continued) 2. ENDED YEAR THE FOR SIGNIFICANT ACCOUNTINGPOLICIES has beenchargedinfulltoshareholders’equityisalsodeductedwhendeterminingthegainorlossondisposalofasubsidiary 2002which which werenotpreviouslyrecognisedintheConsolidatedIncomeStatement.Goodwilloccurringpriorto1January 2002andexchangedifferences net assetstogetherwithanybalanceofgoodwillonacquisitionoccurringorafter1January isthedifferencebetweennetdisposalproceedsandGroup’sThe gainorlossondisposalofasubsidiary shareofits consistency withtheGroup’s accountingpolicies. unless costcannotberecovered.Wherenecessary, adjustmentsaremadetothefinancialstatementsofsubsidiaries toensure Inter-company transactions,balancesandunrealisedgainsontransactionsareeliminated;lossesalsoeliminated ensure consistencywiththeGroup’s accountingpolicies. Where necessary, inapplyingtheequitymethod,appropriateadjustmentsaremadetoassociates’financialstatements behalf oftheassociate. amountoftheinvestmentinanassociatereacheszero,unlessGrouphasincurred ormadepaymentson when thecarrying movements areadjustedagainstthecostofinvestmentandincludegoodwillonacquisition.Equityaccountingisdiscontinued oftheGroup.Thecumulativepostacquisition inreserves Statement anditsshareofpostacquisitionmovementswithinreserves Equity accountinginvolvesrecognisingtheGroup’s shareofpostacquisitionresultstheassociatesinConsolidatedInco Investments inassociatesareaccountedfortheconsolidatedfinancialstatementsbyequitymethodofaccounting. influence isthepowertoparticipateinfinancialandoperatingpolicydecisionsofassociatesbutnotcontroloverth Associates arecorporationsorotherentitiesinwhichtheGroupexercises significant influencebutwhichitdoesnotcontrol. i)OtherIntangibleAssets (ii) Goodwill (i) Intangible assetsarenotrevalued. subject toimpairment,theend oftheassignmentperiodonastraightlinebasis,notexceeding aperiodof15years. fee payableiscapitalisedandamortised overthedefinedperiod,fromeffectivedateofcommercialisation of services, On 2April2003,theCompanyincurredexpenditurewithrespect to acquisitionof3GSpectrumlicence.Thetotallicence goodwill hasnotbeenretrospectivelycapitalisedandsubjectedto impairment testasitwasimpracticaltoreinstate. intheyearofacquisition.Such 2002waswrittenoffagainstreserves Goodwill onacquisitionoccurredpriorto1January should notbereversedunlessitsreversalisduetotheeffectofaspecific externaleventofanexceptionalnature. may exist.ImpairmentofgoodwillischargedtoConsolidatedIncome Statementasandwhenitarises.Impairmentofgoodwill Capitalised goodwillistestedforimpairmentatleastannually, orifeventscircumstances occurindicatingthatanimpairm an associate,isincludedinthecostofinvestmentassociates. isincludedintheConsolidatedBalanceSheetasintangibleassetor,2002 inrespectofasubsidiary ifarisinginrespectof assets ofsubsidiariesandassociatesatthedateacquisition.Goodwillonacquisitionoccurringorafter1January Goodwill representstheexcessofcostacquisitionoverGroup’s shareofthefairvalueidentifiablenet 31 DECEMBER 2003 ose policies.

Significant me ent . .PROPERTY, PLANTANDEQUIPMENT 5. v RepairsandMaintenance (v) GainsorLossesonDisposal (iv) Impairment (iii) i)Depreciation (ii) Cost (i) Property, plantandequipmentarestatedatcostlessaccumulateddepreciationimpairmentlosses. depreciated overtheremainingusefullifeofrelatedasset. oftheexistingassetwillflowtoGroup.Thesecostsare excess oftheoriginallyassessedstandardperformance amountoftheassetwhenitisprobablethatfutureeconomic benefitsin major renovationsisincludedinthecarrying Repairs andmaintenancearechargedtotheIncomeStatementduring theperiodinwhichtheyareincurred.Thecostsof amountandareincludedinIncomeStatement. Gains orlossesondisposalaredeterminedbycomparingproceedswith carrying down immediatelytoitsrecoverableamount.SeeSignificantAccountingPoliciesnote7onImpairmentofAssets. amountofproperty,Where anindicationofimpairmentexists,thecarrying plantandequipmentareassessed written authorities astotheirtenure,amortisationisprovidedatanestimatedamountofRM0.3millionperannum. In thecaseofotherlandmentionedinnote19(a)tofinancialstatements,pendingfinalisationwithrelevant ready fortheirintendeduse. Depreciation onproperty, plantandequipmentunderconstructioncommenceswhentheproperty, plantandequipmentare The estimatedusefullivesinyearsassignedtootherproperty, plantandequipmentareasfollows: their estimatedusefullives. plant andequipmentaredepreciatedonastraightlinebasistowriteoffthecostofassetstheirresidualvaluesover of therespectiveleases.Longtermleaseholdlandhasanunexpiredleaseperiod50yearsandabove.Otherproperty, Freehold landisnotdepreciatedasithasaninfinitelife.Leaseholdamortisedinequalinstalmentsovertheperiods and equipmentcomprisestheirpurchase costandanyincidentalofacquisition. premises andincludescontractors'charges,materials,directlabourrelatedoverheads.Thecostofotherproperty, plant Cost oftelecommunicationnetworkcomprisesexpenditureuptoandincludingthelastdistributionpointbeforecustomers' optrspotsses3–5 – 3 8 – 5 Buildings Computer supportsystems Movable plantandequipment T lcmuiainntok3–20 – 3 elecommunication network 5–40

171 172 1 BONDS, NOTES ANDDEBENTURES 11. CASHANDEQUIVALENTS 10. TRADERECEIVABLES 9. INVENTORIES 8. IMPAIRMENT OFASSETS 7. INVESTMENTS 6. ENDED YEAR THE FOR SIGNIFICANT ACCOUNTINGPOLICIES amount ofmarketablesecuritiesarecredited/chargedtotheIncomeStatement. to stockexchangequotedsellingpricesatthecloseofbusinessonbalancesheetdate.Increase/decreaseincarrying ofinvestment. Costisderivedatontheweightedaveragebasis.Marketvaluecalculatedbyrefe portfolio basisbycategory Investments inquotedshareswithincurrentassetsarecarriedatthelowerofcostandmarketvalue,determinedonanaggregat in theperiodwhichdiminutionisidentified. inthevalueofsuchinvestments.Suchallowancesforpermanentdiminutionisrecognisedasanexpense than temporary at costandallowancesforpermanentdiminutioninvalueismadewhere,theopinionofDirectors,thereadeclineoth Investments inInternationalSatelliteOrganisations,quotedshareswithinnon-currentassetsandotherunquotedaresta the investmentisassessedandwrittendownimmediatelytoitsrecoverableamount. amountof Investments insubsidiariesandassociatesarestatedatcost.Whereanindicationofimpairmentexists,thecarrying to theIncomeStatement. amountandarecharged borrowings areallocatedtoperiods overthetermofborrowingsataconstantrateoncarrying issue. Thefinancecostswhichrepresent thedifferencebetweennetproceedsandtotalamount ofthepaymentsthese Bonds, notesanddebentures,issued bytheCompanyandspecialpurposesentitiesarestatedat netproceedsreceivedon risk ofchangeinvalue. short term,highlyliquidinvestmentsthatarereadilyconvertibleto known amountsofcashandwhicharesubjecttoinsignific Cash andcashequivalentscompriseinhand,bankbalances, demanddepositsandbankoverdrafts.Cashequivalentsare is madetocoverpossiblelosseswhicharenotspecificallyidentified. receivables consideredtobedoubtfulofcollection.Inaddition,a general allowancebasedonapercentage oftradereceivable T costs tocompletion.Inarrivingatthenetrealisablevalue,dueallowanceismadeforallobsoleteandslowmovingitems. value. Costisdeterminedonaweightedaveragebasis.Netrealisablevaluerepresentstheestimatedsellingpricelessallest Inventories comprisemainlyitemsheldforcapitalprojectsandmaintenance.arestatedatlowerofcostnetre the lowestlevelforwhichthereisseparatelyidentifiablecashflows.TheimpairmentlosschargedtoIncomeStatement. is thehigherofanasset’s netsellingpriceandvalueinuse.Forthepurposeofassessingimpairment,assetsaregroupedat amountoftheassetexceedsitsrecoverableamount.The recoverableamount recognised fortheamountbywhichcarrying whenever eventsorchangesincircumstances amountmaynotberecoverable.Impairmentlossis indicatethatthecarrying Property, plantandequipmentothernon-currentassets,includingintangiblearereviewedforimpairmentlosses rade receivablesarecarriedatanticipatedrealisablevalue.Baddebtswrittenoffandspecificallowancesmadefort 31 DECEMBER 2003 alisable imated rence rade ant ted er e s 5 CONTINGENTLIABILITIESANDASSETS 15. INCOMETAXES 14. OPERATING LEASES 13. DIVIDENDSTO SHAREHOLDERSOFTHECOMPANY 12. BONDS, NOTES ANDDEBENTURES (continued) 11. T differencesorunutilisedtax lossescanbeutilised. temporary Deferred taxassetsarerecognisedtotheextentthatitisprobable taxableprofitwillbeavailableagainstwhichthede amountsinthefinancialstatements. assets andliabilitiesfortaxpurposestheircarrying way ofpenaltyisrecognisedasanexpenseintheperiodwhichterminationtakesplace. When anoperatingleaseisterminatedbeforetheperiodhasexpired,anypaymentrequiredtobemadelessorby Income Statementonthestraightlinebasisoverleaseperiod. operating leases.Paymentsmadeunderleases(netofanyincentivesreceivedfromthelessor)arechargedto Leases ofassetswhereasignificantportiontherisksandrewardsownershipareretainedbylessorclassifiedas be accountedforasliability. as aliabilityatthebalancesheetdatebutanappropriationfromretainedprofits.Upondividendbecomingpayable,it proposed ordeclaredafterthebalancesheetdate,butbeforefinancialstatementsareauthorisedforissue,isnotrecogni sharesarerecognisedasliabilitieswhenproposedordeclaredbeforethebalance sheetdate.Adividend Dividends onordinary within financecostintheIncomeStatement. Interest, dividends,lossesandgainsrelatingtoafinancialinstrument,orcomponentpart,classifiedasliabilityisrep conversion. TheConvertibleBondshavebeenfullyredeemedduringtheyear. conversion amountoverthenominalvalueofshareistreatedaspremium.Nogainorlosswillberecognisedon upon conversionwillbetheamountatwhichliabilityforBondsisstatedasdateofconversion.Theexcesst 2002,theamountrecognisedinshareholders’fundrespectofsharesissued For ConvertibleBondsissuedpriorto1January economic benefits areprobable,butnotvirtuallycertain. beyond thecontrol oftheGroup.TheGroupdoes notrecognisecontingentassets butdisclosesitsexistencewhere inflowsof A contingentassetisapossible thatarisesfrompasteventswhoseexistencewillbeconfirmed byuncertainfutureevent that cannotberecognisedbecause itcannotbemeasuredreliably. be requiredtosettletheobligation. Acontingentliabilityalsoarisesintheextremelyrarecircumstance wherethere isali control oftheGrouporapresent obligationthatisnotrecognisedbecauseitprobable an outflowofresources wil is apossibleobligationthatarisesfrompasteventswhoseexistence willbeconfirmedbyuncertainfutureeventsbeyondthe The Groupdoesnotrecogniseacontingentliabilitybutdiscloses its existenceinthefinancialstatements.Acontingentliabi differencesarisingbetweentheamountsattributed Deferred taxisrecognisedinfull,usingtheliabilitymethod,ontemporary retained earningstocompaniesintheGroup,andrealpropertygainstaxespayableondisposalofproperties. orassociate ondistributions taxes baseduponthetaxableprofits,includingwithholdingpayablebyaforeignsubsidiary Current taxexpenseisdeterminedaccordingtothelawsofeachjurisdictioninwhichGroupoperatesandincludeall ax ratesenactedorsubstantivelybythebalancesheetdate areusedtodeterminedeferredtax. ductible ability orted sed will lity

he to of s l

173 174 8 FINANCECOST 18. EMPLOYEE BENEFITS 17. REVENUERECOGNITION 16. ENDED YEAR THE FOR SIGNIFICANT ACCOUNTINGPOLICIES is recognisedonanaccrualbasis. Finance incomeincludesfromdepositswithlicensedbanks,financecompanies,otherfinancialinstitutionsandstaffloa is established. Dividend incomefrominvestmentinsubsidiaries,associatesandotherinvestmentsisrecognisedwhenarighttoreceivepayment time oftheprovisionproductsorservices. discounts andsalestaxespaid,aftereliminatingrevenuewithintheGroup.Operatingisrecognisedoraccruedat netofreturns,duties,sales Operating revenuerepresentsearnedfromthesaleofproductsandrenderingservices property, plantandequipmentarereadyfortheirintendeduse.Allotherfinance costischargedtotheIncomeStatement. Cost incurredinconnectionwithfinancingtheconstructionandinstallation ofproperty, plantandequipmentiscapitalisedun i)EquityCompensationBenefits (iv) Termination Benefits (iii) ContributiontoEmployeesProvidentFund(EPF) (ii) ShortTerm EmployeeBenefits (i) and sharepremium. Company. Whenshareoptionsareexercised, proceedsreceivednetofanytransaction costs,arecreditedtosharecapital sharesofthe does notmakeachargetotheIncomeStatementinconnectionwithoptionsgrantedoverordinary Details oftheCompany’s EmployeeShareOptionSchemearesetoutinnote10(e)tothefinancialstatements.TheCompany redundancy.voluntary Benefitsfallingduemorethan12monthsafterthebalancesheetdatearediscountedtopresent value. formal planwithoutpossibilityofwithdrawalortoprovideterminationbenefitsasaresultanoffermadeencourage benefits whenitisdemonstrablycommittedtoeitherterminatetheemploymentofcurrentemployeesaccordingadetailed redundancyinexchangeforthesebenefits.TheGrouprecognisestermination whenever anemployeeacceptsvoluntary T contributions havebeenpaid,theGrouphasnofurtherpaymentobligations. The Group’s contributionstoEPFarechargedtheIncomeStatementinperiodwhichtheyrelate.Once arerenderedbyemployeesoftheGroup. the associatedservices W ermination benefitsarepayablewheneveranemployee’s employmentisterminatedbeforethenormalretirementdateor ages, salaries, paid annual leave and sick leave, bonuses and non monetary benefitsareaccruedintheperiodwhich ages, salaries,paidannualleaveandsickleave,bonusesnonmonetary 31 DECEMBER 2003 til the ns, 0 FINANCIALINSTRUMENTS 20. FOREIGNCURRENCY 19. ii ClosingRates (iii) ForeignCurrencyTransactions andBalances (ii) ForeignEntities (i) i Description (i) end areasfollows: The principalclosingrates(unitsofMalaysianRinggitperforeigncurrency)usedintranslatingsignificantbalancesatyear All otherexchangegainsorlossesaredealtwiththroughtheIncomeStatement. and liabilitiesareincludedintheIncomeStatement. assets arising fromthesettlementofforeigncurrencytransactionsandtranslationmonetary assetsandliabilitiesaretranslatedatexchangeratesprevailingthebalancesheetdate.Exchange differences monetary Foreign currencytransactionsareaccountedforatexchangeratesprevailingthetransactiondates. exchange rateprevailingatthedateoftransaction. Goodwill andfairvalueadjustmentsarisingontheacquisitionofforeignsubsidiaries/associatesaretranslatedat differences arerecognisedintheConsolidatedIncomeStatementaspartofgainorlossondisposal. intheshareholders’equity.Exchange FluctuationReserve Ondisposaloftheforeignsubsidiaries/associates,suchtranslation differences arisingfromthetranslationofforeignsubsidiaries/associatesfinancialstatementsarereflectedin period andthebalancesheetsaretranslatedatclosingrateofexchangeprevailingsheetdate.Exchange Income Statementofforeignsubsidiaries/associatesaretranslatedintoRinggitMalaysiaataverageexchangeratesforthe enterprise, ortoexchangefinancial instrumentswithanotherenterpriseunderconditionsthatarepotentially unfavourable. A financialliabilityisanythatacontractualobligation todelivercashoranotherfinancialasset favourable, oranequityinstrumentofanotherenterprise. enterprise, acontractualrighttoexchangefinancialinstrumentswith anotherenterpriseunderconditionsthatarepotentially A financialassetisanythatcash,acontractualrightto receivecashoranotherfinancialassetfrom equity instrumentofanotherenterprise. A financialinstrumentisanycontractthatgivesrisetobotha assetofoneenterpriseandafinancialliabilityor SDla M.00 M.00 r ak ue M.34 RM0.03940 RM1.68780 RM0.03946 RM5.16620 RM0.44471 RM1.84470 RM5.64670 RM0.56929 SpecialDrawingRights GoldFrancCurrency 31.12.2002 Sri LankaRupee SouthAfricanRand 31.12.2003 RM0.00193 RM0.06592 RM3.80000 RM0.00191 RM0.06501 RM0.03198 RM3.80000 RM0.03539 ForeignCurrency Bangladesh Taka 31.12.2002 Guinea Franc 31.12.2003 Japanese Yen US Dollar Foreign Currency

175 176 0 FINANCIALINSTRUMENTS (continued) 20. ENDED YEAR THE FOR SIGNIFICANT ACCOUNTINGPOLICIES These accountingpoliciesformanintegralpartofthefinancialstatementssetoutonpages177to248. FairValue EstimationforDisclosurePurposes (iv) FinancialInstrumentsNotRecognisedontheBalanceSheet (iii) FinancialInstrumentsRecognisedontheBalanceSheet (ii) fair value. valueforfinancialassetsandliabilitieswithamaturityoflessthanoneyearareassumedto approximate their The carrying available totheGroupforsimilarfinancialinstruments. value offinancialliabilitiesisestimatedbydiscountingthefuturecontractualcashflowsatcurrentmarketinterestrat techniques, suchasestimateddiscountedvalueoffuturecashflows,areusedtodeterminefairvalue.Inparticular, thefair that arebasedonmarketconditionsexistingateachbalancesheetdate.Quotedpricesusedifavailableorother In assessingthefairvalueofnon-tradedfinancialinstruments,Groupusesavarietymethodsandmakesassumptions The fairvalueofpubliclytradedfinancialinstrumentsisbasedonquotedmarketpricesatthebalancesheetdate. respect offutureperiods. Statement inthesameperiodasexchangedifferencesonunderlyinghedgeditems.Noamountsarerecognised Exchange gainsandlossesrelatingtohedgeinstrumentsarerecognisedasacomponentoffinancecostsintheIncome related expensesonthehedgedliabilities. and paymentsarisingfrominterestratederivativeinstrumentsareaccrued,soastomatchthenetdifferentialwith underlying foreigncurrencyliabilitiesaretranslatedattheirrespectivehedgedexchangerate,anddifferentialinterestrece and theirhedgeinstruments.Theseinstrumentsarenotrecognisedinthefinancialstatementsoninception.The exposures ofitsfinancialliabilities.Hedgeaccountingprinciplesareappliedfortheunderlying The financialderivativehedginginstrumentsareusedintheGroup’s riskmanagementofforeigncurrencyandinterestrate in theindividualsignificantaccountingpolicystatementsassociatedwitheachitem. The particularrecognitionandmeasurementmethodforfinancialinstrumentsrecognisedonthebalancesheetisdisclosed 31 DECEMBER 2003 ipts e pca 9 9 8 8 Report oftheAuditors–Page250. Notes totheFinancialStatements onpages182to248. The aboveIncomeStatementsare tobereadinconjunctionwiththeSignificantAccountingPolicies onpages169to176andthe – special – final PROPOSED DIVIDENDSPERSHARE(sen) – diluted – basic 7 EARNINGS PERSHARE(sen) 7 PROFIT/(LOSS) FORTHEYEARATTRIBUTABLE 6 PROFIT/(LOSS) AFTERTAXATION – shareoftaxationassociates – thecompanyandsubsidiaries T 5 PROFIT BEFORETAXATION – shareofprofitslesslosses ASSOCIATES 2003 NET FINANCECOST OPERATING PROFITBEFOREFINANCECOST Note OTHER OPERATING INCOME OPERATING PROFIT All amountsareinmillions ENDED YEAR THE FOR INCOME STATEMENTS nesohriesae RM stated unless otherwise MINORITY INTERESTS PRTN OT 4 3 OPERATING COSTS OPERATING REVENUE AXATION TO SHAREHOLDERS 31 D ECEMBER 2003 (10,018.2) 11,796.4 1,390.4 1,444.2 1,810.5 1,865.3 1,778.2 (112.6) (253.7) (430.0) 375.2 (53.8) 10.0 10.0 43.2 43.6 87.1 H RU THECOMPANY THE GROUP (8,154.8) 1,530.4 1,791.8 1,679.3 9,834.1 (626.7) (303.9) 844.3 112.5 870.7 (33.0) (26.4) 2002 10.0 26.6 26.8 42.5 RM — (6,916.8) 1,315.9 1,026.9 7,943.7 (364.0) (422.9) 529.0 289.0 529.0 893.0 2003 RM — — — (7,829.7) 7,977.1 (572.0) (365.3) (498.5) (498.5) 291.4 438.8 147.4 2002 73.5 RM — — —

177 BALANCE SHEETS AS AT 31 DECEMBER 2003

THE GROUP THE COMPANY All amounts are in millions Note 2003 2002 2003 2002 unless otherwise stated RM RM RM RM

SHARE CAPITAL 10 3,250.7 3,167.0 3,250.7 3,167.0 SHARE PREMIUM 3,046.4 2,536.5 3,046.4 2,536.5 RESERVES 11 10,485.3 9,216.1 9,894.5 9,593.9

TOTAL CAPITAL AND RESERVES 16,782.4 14,919.6 16,191.6 15,297.4 MINORITY INTERESTS 245.1 225.7 — —

Convertible Bonds 12 — 1,361.6 — 1,361.6 Borrowings 13 10,830.6 4,826.9 6,432.1 4,997.0 Payable to a subsidiary company 14 — — 2,983.5 — Customers’ deposits 16 626.9 625.5 614.9 614.4 Deferred tax liabilities 17 2,031.5 1,590.3 1,694.6 1,533.6

DEFERRED AND LONG TERM LIABILITIES 13,489.0 8,404.3 11,725.1 8,506.6

30,516.5 23,549.6 27,916.7 23,804.0 178 INTANGIBLE ASSETS 18 4,072.7 — 50.0 — PROPERTY, PLANT AND EQUIPMENT 19 21,605.9 19,566.5 14,569.4 15,251.0 SUBSIDIARIES 20 — — 10,926.2 6,993.5 ASSOCIATES 21 1,499.6 2,746.5 1.5 96.0 INVESTMENTS 22 384.7 139.6 338.1 98.3 LONG TERM RECEIVABLES 23 668.9 685.4 668.8 684.6 DEFERRED TAX ASSETS 17 160.4 — — —

Inventories 24 203.6 172.5 103.3 105.7 Trade and other receivables 25 3,835.0 3,592.4 3,104.5 2,942.6 Short term investments 26 263.4 197.7 260.3 197.7 Cash and bank balances 27 3,346.1 1,834.8 852.0 1,138.2

CURRENT ASSETS 7,648.1 5,797.4 4,320.1 4,384.2

Trade and other payables 28 4,522.0 3,675.7 2,863.1 2,576.5 Borrowings 13 877.8 1,488.0 2.9 920.4 Taxation 124.0 222.1 91.4 206.7

CURRENT LIABILITIES 5,523.8 5,385.8 2,957.4 3,703.6

NET CURRENT ASSETS 2,124.3 411.6 1,362.7 680.6

30,516.5 23,549.6 27,916.7 23,804.0

The above Balance Sheets are to be read in conjunction with the Significant Accounting Policies on pages 169 to 176 and the Notes to the Financial Statements on pages 182 to 248.

Report of the Auditors – Page 250. nesohriesae MR MR RM RM RM Total RM Profits RM Reserves Premium 42 Capital – prioryearadjustments Note – aspreviouslyreported 2003 At 1January stated unless otherwise All amountsareinmillions 11.01———(4.)(341.6) 535.0 (341.6) 844.3 14,919.6 — — 9,523.2 844.3 (307.1) — — — 13,805.8 2,536.5 (1,361.3) 9,020.5 471.5 — — 3,167.0 (1,361.3) (383.2) 63.5 Report oftheAuditors–Page250. 15,167.1 — — 2,065.0 169 to176andtheNotes Financial Statementsonpages182to248. 10,381.8 The aboveConsolidatedStatement ofChangesinEquityistobereadconjunctionwiththeSignificant AccountingPolicieson 16,782.4 3,103.5 — (383.2) 10,685.2 * IssuedandfullypaidsharesincludetheSpecialRightsRedeemable PreferenceShare(SpecialShare)ofRM1.Refertonote10 2,065.0 (199.9) At 31December2002 — 3,103.5 – exercise ofshareoptions 3,046.4 Issue ofshares – 31.12.2001 Dividends paidforyearended 3,250.7 42 Profit fortheyear Exchange fluctuationnotrecognised – asrestated 9 – prioryearadjustments – aspreviouslyreported 2002 At 1January At 31December2003 – exercise of shareoptions Issue ofshares – 31.12.2002 Dividends paidforyearended Profit fortheyear Exchange fluctuationnotrecognised – asrestated ENDED YEAR THE FOR CONSOLIDATED STATEMENT OFCHANGESINEQUITY nicm ttmn 61—76.1 — 76.1 — — in incomestatement in incomestatement the financialstatementsfordetailsoftermsandrightsattached toSpecialShare. 31 DECEMBER 2003 ado M ahNndsrbtbeDistributable Non-distributable Paid ofRM1each Issued andFully Ordinary Shares Ordinary Special Share*/ ,6. ,3. 371 ,4. 15,245.3 9,848.9 (307.1) 2,536.5 3,167.0 ,6. ,3. 371 ,2. 14,919.6 9,523.2 (307.1) 2,536.5 3,167.0 hr hr lcuto Retained Fluctuation Share Share 37599——593.6 — — 509.9 83.7 ——— —— ——— ——— Exchange 0. 107.2 — 107.2 ,9. 1,390.4 1,390.4 357 (325.7) (325.7) 284 (228.4) (228.4) pages to

179 180 nesohriesae MR MRM RM RM Total Profits RM Premium 42 Capital Note – prioryearadjustment – aspreviouslyreported 2003 At 1January stated unless otherwise All amountsareinmillions 11.01——(4.)(341.6) 535.0 15,297.4 (341.6) (498.5) 9,593.9 — — (498.5) 2,536.5 15,602.5 471.5 — 3,167.0 — 10,434.0 (1,361.3) 63.5 2,065.0 (1,361.3) — 16,963.8 Report oftheAuditors–Page250. 3,103.5 — 11,795.3 169 to176andtheNotes Financial Statementsonpages182to248. 16,191.6 The aboveCompanyStatementof ChangesinEquityistobereadconjunctionwiththeSignificant AccountingPoliciesonpages 2,065.0 — 9,894.5 3,103.5 3,046.4 * IssuedandfullypaidsharesincludetheSpecialRightsRedeemable PreferenceShare(SpecialShare)ofRM1.Refertonote10 3,250.7 At 31December2002 42 – exercise ofshareoptions Issue ofshares – 31.12.2001 Dividends paidforyearended 9 Loss fortheyear – asrestated – prioryearadjustment – aspreviouslyreported 2002 At 1January At 31December2003 – exercise of shareoptions Issue ofshares – 31.12.2002 Dividends paidforyearended Profit fortheyear – asrestated ENDED YEAR THE FOR COMPANY STATEMENT OFCHANGESINEQUITY the financialstatementsfordetailsoftermsandrightsattached toSpecialShare. 31 DECEMBER 2003 ado M ahdsrbtbeDistributable distributable Paid ofRM1each sudadFlyNon- Issued andFully Ordinary Shares Ordinary Special Share*/ ,6. ,3. 117516,831.0 11,127.5 2,536.5 3,167.0 ,6. ,3. ,9. 15,297.4 9,593.9 2,536.5 3,167.0 hr hr Retained Share Share 37599—593.6 — 509.9 83.7 —— —— —— 1536 (1,533.6) (1,533.6) 284 (228.4) (228.4) 2. 529.0 529.0 to Report oftheAuditors–Page250. Notes totheFinancialStatements onpages182to248. The aboveCashFlowStatements are tobereadinconjunctionwiththeSignificantAccountingPolicies onpages169to176andt CASH ANDEQUIVALENTS AT ENDOFTHEYEAR CASH ANDEQUIVALENTS AT BEGINNINGOF 2003 EFFECT OFEXCHANGERATE CHANGES Note NET INCREASE/(DECREASE)INCASHAND All amountsareinmillions ENDED YEAR THE FOR CASH FLOW STATEMENTS nesohriesae RM stated unless otherwise AHFOSFO IACN CIIIS31 30 29 CASH FLOWSFROMFINANCINGACTIVITIES CASH FLOWSUSEDININVESTINGACTIVITIES CASH FLOWSFROMOPERATING ACTIVITIES THE YEAR EQUIVALENTS 31 DECEMBER 2003 27 (5,618.4) 3,279.3 1,821.0 1,471.7 2,427.3 4,662.8 (13.4) H RU THECOMPANY THE GROUP (4,725.6) 1,821.0 2,520.1 3,223.4 (692.4) 809.8 2002 (6.7) RM (5,639.4) 1,138.2 2,415.4 2,937.8 (286.2) 852.0 2003 RM — (4,095.2) 1,138.2 2,110.5 2,584.6 (972.3) 538.3 2002 RM — he

181 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2003

All amounts are in millions unless otherwise stated

1. PRINCIPAL ACTIVITIES The principal activities of the Company during the year are the establishment, maintenance and provision of telecommunication and related services under the licence issued by the Minister of Energy, Communications and Multimedia. The principal activities of the subsidiaries are set out in note 43 to the financial statements. There was no significant change in the nature of these activities during the year.

2. SIGNIFICANT ACQUISITION As at 1 January 2003, the Group held a 31.25% equity interest in Celcom (Malaysia) Berhad (Celcom). Following shareholders’ approval during the Extraordinary General Meeting held on 31 March 2003, the Group acquired additional equity interest of 16.68% in Celcom on 17 April 2003. As a result, Celcom became a subsidiary of the Group with a total shareholding of 47.93%.

The Company’s 100% interest in TM Cellular Sdn. Bhd. (TM Cellular) is now held via Celcom by way of share swap for a total consideration of RM1,684.0 million which was satisfied by the issuance of 635,471,698 new Celcom ordinary shares of RM1.00 each at RM2.65 per share to Telekom Enterprise Sdn. Bhd. (TESB), a wholly owned subsidiary of the Company.

The Group subsequently acquired the remaining 52.07% equity interest in Celcom, making it a wholly owned subsidiary. 182

The cash consideration paid by the Group for the remaining 52.07% in Celcom was undertaken by way of the following transactions:

• On 22 April 2003, TESB acquired an additional 55,000,000 Celcom ordinary shares of RM1.00 each from open market at RM2.715 per share for a total cash consideration amounting to RM149.5 million being 2.1% equity interest.

• On 23 May 2003, the Company (via TESB) undertook a Mandatory General Offer (MGO) for the remaining 1,280,136,722 Celcom ordinary shares of RM1.00 each at RM2.75 per share (Offer Shares) not held by TESB and persons acting in concert with TESB (PAC). On 19 June 2003, the Company and TESB announced that acceptances had been received for more than 90% of the Offer Shares and that TESB would invoke Section 34 of the Securities Commission Act, 1993 (SCA) to compulsorily acquire the remaining Celcom ordinary shares of RM1.00 each at RM2.75 per share not held by TESB and the PAC. As at the close of the MGO on 27 June 2003, TESB and PAC held 98.54% of the issued and paid-up share capital of Celcom. During the same period, the PAC disposed its 28,616,100 Celcom ordinary shares of RM1.00 each at RM2.75 per share to TESB. Total cash consideration for the above was RM3,494.5 million.

• On 1 August 2003, TESB dispatched the notice for the compulsory acquisition of the remaining 38,035,820 Celcom shares under Section 34 of the SCA. As a consequence of the Group’s notice for compulsory acquisition, Celcom was delisted from Malaysia Securities Exchange Berhad official list on 15 August 2003. The compulsory acquisition was completed on 29 September 2003. Total cash consideration for the compulsory acquisition was RM104.7 million.

The terms of the conditional Sale and Purchase Agreement in relation to the acquisition of TM Cellular by Celcom included Celcom’s agreement and undertaking to pay to the Company, a sum equivalent to any damages or settlement awarded against Celcom in the form of the equivalent number of shares in Celcom, based on a pre-determined formula, limited to a maximum of 100.0 million shares in Celcom. .SIGNIFICANTACQUISITION(continued) 2. odil(oe1 otefnnilsaeet)2,814.8 Goodwill (note18tothefinancialstatements) arvleo e sesaqie sa 7Arl20 221.4 1,453.8 (475.4) 735.8 21.2 Acquisition(1.46%) Fair valueofadditionalnetassetsacquiredoncompletionCompulsory Fair valueofadditionalnetassetsacquiredfrom17Aprilto27June2003(50.61%) Fair valueofnetassetsacquiredasat17April2003 Less: Amountaccountedforasanassociateat16April2003 Minority interestsat52.07% Fair valueoftotalnetassetsasat16April2003 Details ofnetassetsacquired,goodwillandcashflowarisingfromtheacquisitionwereasfollows: ucaecnieaindshre ycs 3,748.7 (829.7) 44.5 2,963.5 •T • completion ofareviewthenetassetsfairvalues,whichiscurrently inprogress. The fairvalueofthenetassetsacquiredareprovisionalandsubject tothemattersindicatedbelowwhichwillbefinalisedup companyfortheacquisition Cash advanceoftheCompanytoasubsidiary Cash outflowoftheGrouponacquisition(note30tofinancial statements) acquired Less: Cashandcashequivalentsofsubsidiary 3,793.2 Expenses directlyattributabletotheacquisition,paidbycash Purchase considerationdischargedbycash Cost ofacquisition(comprisingpurchase considerationandexpensesdirectlyattributabletotheacquisition) rpry ln n qimn nt 9t h iaca ttmns 3,084.8 T Inventories Investment inassociates Property, plantandequipment(note19tothefinancialstatements) ahadbn aacs(nlsv ie eoi lde fR6. ilo)890.4 Borrowings Customers deposits Deferred taxliabilities Current taxliabilities T Cash andbankbalances(inclusivefixeddepositpledgedofRM60.7million) Short terminvestments rade andotherreceivables rade andotherpayables (note 30tothefinancialstatements) The fairvalueofCelcom’s telecommunication plantandequipment. carried outtoagreeontaxassessments priortothedateofacquisition. axation liabilitiesofCelcomhad not beenagreedwiththeappropriatetaxauthoritiesformanyyears andworkisbeing acquisition At dateof (1,954.4) 3,793.2 (757.0) (107.1) (238.3) (588.0) 978.4 103.5 286.3 (34.2) RM 8.7 2.1 on

183 184 .SIGNIFICANTACQUISITION(continued) 2. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS Operating costs Group’s shareofresultsCelcomduringtheperioditwasanassociate,isalsodisclosed. Operating revenue Share ofresultsassociate The effectofthisacquisitiononthefinancialresultsGroupduringyearisshownbelow. Foreaseofcomparability, Increase inGroupnetassets Less: Group’s shareofprofithadtheGroup notacquiredtheadditional68.75%interest Less: Amountaccountedforasan associateat16April2003 Group’s shareofnetassets Current liabilities Non-current liabilities Current assets Non-current assets(includinggoodwillonacquisitionofCelcom) The effectofthisacquisitionontheGroup’s financialpositionattheyear end wasasfollows: Profit/(loss) attributabletoshareholders Profit aftertaxation Profit beforetaxation Operating profitbeforefinancecost Operating profit Less: Group’s shareofnetprofithadtheGroup Net financecost Other operatingincome Minority interests T axation not acquiredtheadditional68.75%interest 31 DECEMBER 2003 soit usdayTotal subsidiary associate sa Asa As an 4.)(45 (88.7) (44.5) (44.2) 428052.2 8.0 44.2 42125186.7 247.3 142.5 203.1 44.2 44.2 MR RM RM RM — — — — — — — — — 2003 1641 (1,614.1) (1,614.1) ,6. 1,862.6 1,862.6 6. 262.4 248.5 262.4 248.5 6.)(67.3) (67.3) 6.)(60.6) (60.6) 2.)(24.9) (24.9) 3173.1 73.1 3913.9 13.9 associate (1,160.0) (1,852.4) 3,935.7 4,455.6 1,809.6 5,658.4 (475.4) As an (44.5) (15.6) (15.6) (15.6) (15.6) 2002 2003 RM RM — — — — — — — — —

the .OPERATING REVENUE 3. Sub total Residential Business Others Sub total Residential Business Calls/Usage Sub total ellr3,606.3 11,796.4 TOTAL OPERATING REVENUE Cellular T Other telecommunicationrelatedservices Internet andmultimedia Data services T Residential Business T o-eeomncto eae evcs250.3 Non-telecommunication relatedservices Residential Business Rentals otal fixedline,data,internetandmultimedia otal fixedline otal n te eeomncto eae evcs7,939.8 and othertelecommunicationrelatedservices 4,541.4 1,888.7 2,652.7 1,581.6 6,267.2 2,816.3 3,450.9 144.2 334.1 396.5 942.0 854.1 727.5 2003 73.5 70.7 RM H RU THECOMPANY THE GROUP 4,836.5 1,952.1 2,884.4 1,440.6 8,031.5 6,428.8 2,821.6 3,607.2 9,834.1 1,588.9 151.7 395.4 394.5 812.8 213.7 789.9 650.7 2002 79.6 72.1 RM 4,699.6 1,873.7 2,825.9 1,575.9 7,904.7 1,225.6 6,416.7 2,796.7 3,620.0 7,943.7 141.2 193.7 849.9 726.0 2003 73.1 68.1 68.7 39.0 RM — 4,843.2 1,939.1 2,904.1 1,440.9 7,946.0 1,120.0 6,434.8 2,806.6 3,628.2 7,977.1 150.7 264.5 126.7 788.6 652.3 2002 78.9 71.8 31.1 RM —

185 186 .OPERATING COSTS 4. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS – Auditfees 10,018.2 Other operatingcostsinclude: – Salaries,allowances,overtimeandbonus Staff costsinclude: TOTAL OPERATING COSTS – Termination benefits – ContributiontoEmployeesProvidentFund(EPF) Allowance fordiminutioninvalueoflongterminvestments Allowance/(reversal) fordiminution Allowance for/waiverofamountowingbysubsidiaries Charges andagenciescommissions Impairment ofPPE Domestic andinternationaloutpayment Depreciation ofproperty, plantandequipment(PPE) – Otheremployeebenefits – RemunerationsofDirectorstheCompany Allowance forbadanddoubtfuldebts Impairment ofgoodwill Net loss/(gain)onforeignexchange–realised Marketing, advertisingandpromotion Maintenance Write downofinvestmentinasubsidiary Utilities Write offofPPE Other operatingcosts Research and development Rental –others Rental –equipment Rental –landandbuildings Net lossonforeignexchange–unrealised Staff costs Universal Service Obligation(USO) Universal Service Provision(USP) Universal Service Supplies andinventories Staff costscapitalisedinPPE – contributiontoEPF – Others – ex-gratiapayment – PricewaterhouseCoopers Malaysia – salaries,allowancesandbonus in valueofquotedinvestments – fees (net ofbaddebtrecoveries) – inrespectofprioryear 31 DECEMBER 2003 1,155.9 1,464.8 3,551.3 1,411.6 167.3 445.8 536.5 473.8 200.5 918.5 151.2 105.9 238.7 351.9 (49.7) (60.3) 2003 74.3 99.2 86.4 14.7 26.5 45.1 12.1 RM 0.1 0.4 0.1 1.5 1.0 0.8 5.8 — — — — — — H RU THECOMPANY THE GROUP 1,003.1 8,154.8 1,209.0 2,481.8 1,375.1 162.8 147.0 564.4 377.5 323.9 164.0 659.6 102.3 102.3 230.5 342.7 (67.4) 2002 33.7 79.0 60.4 39.7 50.9 79.6 11.8 (5.6) RM 0.1 0.3 0.9 1.2 0.5 — — — — — — — 6,916.8 1,419.5 2,490.9 766.4 120.6 189.2 105.0 114.6 124.9 286.5 151.1 479.8 943.4 187.2 215.0 (47.9) (60.2) 2003 10.3 55.0 14.4 26.5 27.5 95.1 78.5 50.0 RM 0.1 0.1 0.5 0.9 0.3 9.1 4.8 1.6 — — — — 7,829.7 1,074.4 1,176.4 2,088.3 1,110.3 788.6 135.3 322.2 147.0 133.1 292.1 137.4 316.0 348.9 100.9 209.2 237.5 (65.9) 2002 33.7 88.9 38.0 50.9 45.8 23.6 89.8 21.8 (5.6) RM 0.1 0.4 1.0 0.3 — — — — — — .OPERATING COSTS (continued) 4. Share premium sharecapitalatpar Ordinary of theCompanyatexercise datewasRM9.00andRM8.40persharerespectively. The optionswereexercised bytheDirectorson29October2003and17Novemberrespectively. Thefairvaluesofshares and itssubsidiaries(note10(e)tothefinancialstatements). The optionsweregiventotheseDirectorsonthesametermsandconditionsasthoseofferedotheremployeesofCompany OptionsgrantedtoExecutiveDirectorsoftheCompanypursuantEmployees’ShareOptionScheme(ESOS3)during (b) (a) rcesrcie neecs fsaeotos1.0 Proceeds receivedonexercise ofshareoptions Dato’ Dr. AbdulRahimbinHajiDaud Dato’ Dr. MdKhirbinAbdulRahman year areasfollows: RM401,364 (2002:RM109,480)fortheGroup. Estimated moneyvalueofbenefitsDirectorsamountedtoRM128,289(2002:RM44,500)fortheCompanyand 31.12.2003 h ereddatyearend the yearended rne uigUnexercised options Granted during — — 31.12.2002 171,000 178,000 the yearended31.12.2003 31.12.2003 Exercised optionsduring 103,000 108,000 31.12.2002 171,000 178,000 RM 0.8 0.2

187 188 .NETFINANCECOST 6. OTHER OPERATING INCOME 5. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS Finance income Finance costinrespectof: TOTAL NETFINANCECOST NET FINANCECOST T 87.1 TOTAL OTHEROPERATING INCOME Finance incomeofsubsidiaries Finance costofsubsidiaries Dividend incomefromsubsidiaries Dividend incomefromquotedshares Income frominvestmentinInternationalSatelliteOrganisations Dividend incomefromunquotedshares Profit onpartialdisposalofsubsidiaries noefo usdais–interest Income fromsubsidiaries Profit ondisposalofshortterminvestments Profit ondisposalofinvestmentinanInternational Rental incomefromvehicles Rental incomefrombuildings Profit ondisposalofproperty, plantandequipment Sale ofscrapstores Others otal financecost Convertible Bonds Borrowings FTEGOP2887. 12430.0 71.2 70.0 288.8 422.9 17.2 120.3 285.4 OF THEGROUP OF THECOMPANY Satelite Organisation 31 DECEMBER – others oeg oetcPicpe Total Principles Domestic Foreign 2003 8. 4. 38467.7 33.8 148.5 285.4 5. 4. 38435.3 33.8 148.5 253.0 24——32.4 — — 32.4 01(53 4649.4 64.6 (25.3) 10.1 67 2.)(06 (42.3) (10.6) (25.0) (6.7) MR MRM RM RM RM — 2.)(66 (44.8) (16.6) (28.2) 2003 Islamic 2003 58.1 RM 5.7 0.7 9.7 5.3 2.9 1.5 3.2 — — — — — — H RU THECOMPANY THE GROUP oeg oetcPicpe Total Principles Domestic Foreign 1. 112. 437.0 28.0 91.1 317.9 6. 112. 382.3 28.0 91.1 263.2 1. 1.)07303.9 0.7 (16.6) 365.3 319.8 5.8 41.6 317.9 47——54.7 — — 54.7 39 47 54 (14.0) (5.4) (4.7) (3.9) MR MRM RM RM RM . 5.)03(47.4) 0.3 (53.5) 5.8 — 112.5 2002 18.2 71.0 RM 4.0 1.5 0.5 2.8 3.8 6.5 0.1 4.1 — — — — 4.)(22 (71.7) (22.2) (49.5) 2002 289.0 107.2 2003 54.3 44.2 51.3 RM 5.5 0.7 9.7 3.4 5.3 1.3 3.0 3.1 — — Islamic 291.4 2002 26.4 79.7 25.8 80.8 54.7 RM 3.8 1.5 0.5 7.3 3.8 3.1 4.0 — — .TAXATION 7. Share oftaxationassociates OA AAIN366.3 Current taxation: TOTAL TAXATION Deferred taxation: The taxationchargefortheGroupandCompanycomprise: Current year (Over)/Under accrualinprioryears(net) Origination and reversal of temporary differences Origination andreversaloftemporary Benefit frompreviouslyunrecogniseddeductible Overseas Malaysia temporary differencesandtaxlosses temporary In respectofprioryear Current yeartaxation Deferred taxation–net In respectofprioryear Deferred taxation–net Current yeartaxation (160.4) 366.3 112.6 253.7 422.1 202.8 274.0 307.9 (98.2) (93.7) (17.4) (20.3) 2003 59.8 (4.5) RM 1.6 H RU THECOMPANY THE GROUP 659.7 626.7 451.8 659.7 202.6 612.8 193.7 417.9 2002 33.0 13.9 RM 0.9 5.3 4.1 1.2 8.9 — 364.0 364.0 292.9 364.0 161.0 364.0 161.0 292.9 (89.9) (89.9) 2003 RM — — — — — — 572.0 572.0 399.7 572.0 172.3 572.0 172.3 399.7 2002 RM — — — — — — — —

189 190 .TAXATION (continued) 7. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS – Differenttaxationratesinothercountries T The explanationoftherelationshipbetweentaxationexpenseandprofitbeforeisasfollows: OA AAIN366.3 TOTAL TAXATION T – Previouslyunrecognisedtaxdeductible – Expensesallowedfordoublededuction – Incomenotsubjecttotaxation – Expensesnotdeductiblefortaxationpurposes – Reversal of previously recognised temporary differences – Reversalofpreviouslyrecognisedtemporary Profit BeforeTaxation (Over)/Under accrualinprioryears(net) ax effectsof: axation calculatedattheapplicable Malaysian taxationrateof28% temporary differencesandtaxlosses temporary due totaxexemptstatusbeinggranted 31 DECEMBER 2003 1,810.5 (132.7) (160.4) 506.9 273.2 (11.1) (17.4) (98.2) 2003 RM 6.0 H RU THECOMPANY THE GROUP 1,530.4 (363.3) 428.5 659.7 596.9 2002 (8.0) RM 0.3 5.3 — — 250.0 364.0 239.1 893.0 (11.1) (24.1) (89.9) 2003 RM — — — 572.0 561.5 2002 20.6 73.5 (8.0) (2.1) RM — — — — .EARNINGSPERSHARE 8. b Dilutedearningsper share (b) Basicearningspershare (a) on netprofitfortheyearasdescribed innote42tothefinancialstatements. Comparative earningspershareinformation hasbeenrestatedtotakeintoaccounttheeffectofchange inaccountingpolici W Adjustment forESOS3(million) W Net profitattributabletoshareholders(RMmillion) Net profitattributabletoshareholders(RMmillion) For detailsoftheEmployees’ShareOptionScheme,pleaserefertonote10(e)financialstatements. attributable toshareholdersfortheshareoptionscalculation. sharesoutstandingforthepurposeofcomputingdilution.Noadjustmentis made tonetprofit be addedtotheordinary todeterminetheunexercisedsubscription rightsattachedtooutstandingshareoptions.Thiscalculationserves sharesto market price(determinedastheaverageannualshareofCompany’s value ofthe shares)basedonthemonetary For ESOS3offeredsince2002,acalculationisdonetodeterminethenumberofsharesthatcouldhavebeenacquiredat the fairvalueofCompany’s shares. year ended31December2002anduptothedateofredemptionon1August2003sinceexercise pricewashigherthan shares.Forthispurpose,theConvertibleEurobondsdue2004wasdeemednotdilutivefor of alldilutivepotentialordinary sharesinissueisadjustedtoassumeconversion For thedilutedearningspershare,weightedaveragenumberofordinary sharesoftheCompanyinissueduringyear.average numberofordinary Basic earningspershareoftheGroupiscalculatedbydividingnetprofitattributabletoshareholdersweighted ai annsprsae(e)43.6 Basic earningspershare(sen) W iue annsprsae(e)43.2 Diluted earningspershare(sen) eighted average number of ordinary shares fordilutedearningspershare(million) eighted averagenumberofordinary eighted average number of ordinary shares inissue(million) eighted averagenumberofordinary eighted average number of ordinary sharesinissue(million) eighted averagenumberofordinary 3,219.3 3,188.3 3,188.3 1,390.4 1,390.4 2003 2003 31.0 THE GROUP THE GROUP 3,174.8 3,155.3 3,155.3 844.3 844.3 2002 2002 19.5 26.8 26.6 es

191 192 0 SHARECAPITAL 10. DIVIDENDSINRESPECTOFORDINARY SHARES 9. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS Authorised: Dividends proposed in respect of ordinary sharesoftheCompanyforyearareasfollows: Dividends proposedinrespectofordinary OA SUDADFLYPI-PSAECPTL32073,250.7 3,250.7 TOTAL ISSUEDANDFULLY PAID-UP SHARECAPITAL Issued andfullypaid: 468.2 20.0 accrued asaliabilitywhenapprovedbyshareholders. will beproposedforshareholders’approval.Thesefinancialstatementsdonotreflectthisfinaldividendwhichonly amounting toRM234.1millionandaspecialgrossdividendof10.0senpersharelesstax28% At theforthcomingAnnualGeneralMeetingon18May2004,afinalgrossdividendof10.0senpersharelesstax28% TOTAL DIVIDENDSPROPOSED/PAID – proposedfinalgrossdividend Final dividends: – proposedspecialgrossdividend – increaseduetoexercise ofshareoptions Class BRedeemablePreferenceSharesofRM10(sub-noteb) Class ARedeemablePreferenceSharesofRM10(sub-noteb) Ordinary sharesofRM1each Ordinary Special shareofRM1(sub-notea) Ordinary sharesofRM1each Ordinary Special shareofRM1(sub-notea) Exercise ofshareoptions At 1January At 1 January and31December At 1January At 31December 31 DECEMBER 2003 Number of e hr of28%tax per share iieddividend,net dividend ,0. 5,000.0 5,000.0 ,6. 3,167.0 3,167.0 ,5. 3,250.7 3,250.7 hrsRM shares rs Amountof Gross 3783.7 83.7 00234.1 10.0 00234.1 10.0 e RM Sen —— —— —— —— —— 2003 2003 THE GROUPANDCOMPANY THE COMPANY Number of e hr of28%tax per share iieddividend,net dividend ,0. 5,000.0 5,000.0 ,6. 3,167.0 3,167.0 ,0. 3,103.5 3,103.5 ,6. 3,167.0 3,167.0 hrsRM shares rs Amountof Gross 00228.4 10.0 3563.5 63.5 00228.0 10.0 e RM Sen —— —— —— —— —— — 2002 2002 0.4 0 SHARECAPITAL (continued) 10. d On12December2003,theCompanyissuedforcash1,000ClassARedeemablePreferenceShares(RPS)(TMRPSA)and (d) Duringtheyear, theissuedandfullypaid-up share capitaloftheCompanywasincreasedbyissuance83,725,000 (c) On31March 2003,theauthorisedshare capitaloftheCompanyhasbeenincreasedtoinclude1,000ClassARedeemable (b) TheSpecialRightsRedeemablePreferenceShare(SpecialShare)ofRM1wouldenabletheGovernmentthroughMinister (a) e Employees’ShareOptionScheme (e) A andTMRPSBhavebeenclassifiedasliabilities. shares oftheCompanyinadistributioncapitaleventwindinguporliquidationCompany. TMRPS TM RPSAandBrankpari-passuamongstthemselvesbutbelowtheSpecialShareaheadofordinary premium ofRM0.99eachovertheparvalueRM0.01each. 1,000 ClassBRPS(TMB)toRebungUtamaSdn.Bhd.(RUSB),aspecialpurposeentityoftheCompany, ata sharesoftheCompany.pari-passu inallrespectswiththeexistingissuedordinary sharesofRM1eachattheoptionpriceRM7.09pershareforcashunderESOS3.These shares rank ordinary Preference SharesofRM0.01eachand1,000ClassBRedeemableeach. any righttoparticipateinthecapitalorprofitsofCompany. paid-up ontheSpecialShareinprioritytoanyrepaymentofcapitalothermember. The SpecialSharedoesnotconfer distribution ofcapitalinawindinguptheCompany, theSpecialShareholderisentitledtorepaymentofcapital The SpecialShareholderhastherighttorequireCompanyredeemShareatparanytime.Ina takeover, requirethepriorconsentofSpecialShareholder. Shareholder, thedissolutionofCompany, anysubstantialacquisitionsanddisposalofassets,amalgamation, mergerand Certain matters,inparticular, thealterationofArticlesAssociationCompanyrelatingtorightsSpec Company. However, theSpecial Shareholder isentitledtoattendandspeakatsuchmeetings. anyrighttovoteatsuchmeetingsofthe on itsbehalf,isentitledtoreceivenoticesofmeetingsbutdoesnotcarry Government’s policy. TheSpecialShareholder, whichmayonlybetheGovernmentoranyrepresentativepersonacting of FinancetoensurethatcertainmajordecisionsaffectingtheoperationsCompanyareconsistentwith RM7.09 pershare. ESOS 3weregrantedtoeligibleExecutivesandNon-Executivesof the Companyanditssubsidiariesatanexercise priceof sharesof RM1 eachunder Meeting heldon21May2002.On1August2002,optionstosubscribe for259,042,000ordinary General The existingEmployees’ShareOptionScheme3(ESOS3)wasapproved bytheshareholdersatanExtraordinary The detailsofTMRPSAandB i)ThesubscriptionpriceofeachRM1 share shallbetheaverageofmiddlemarketquotation the sharesasshown (iv) Nooptionshallbegrantedforlessthan1,000sharesnormore than550,000sharesunlesssoadjustedpursuantto (iii) Thetotalnumberofshares to beofferedshallnotexceed10%ofthetotalissuedandpaidupsharesCompany. (ii) TheeligibilityforparticipationinESOSisatthe discretionoftheOptionCommitteeappointedbyBoardDirectors. (i) The principalfeaturesofESOS3areasfollows: date ofofferwitha10%discount. in thedailyofficiallistissuedby the MalaysiaSecuritiesExchangeBerhadforfive(5)tradingdays precedingthe item (vi)below. are setoutinnote 14(a) tothe financial statements. ial

193 194 0 SHARECAPITAL (continued) 10. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS e Employees’ShareOptionScheme(continued) (e) The movement during the year in the number of options over the ordinary sharesofRM1eachtheCompany areasfollows: The movementduringtheyearinnumberofoptionsoverordinary v)IntheeventofanyalterationincapitalstructureCompanyduringoptionperiodwhichexpireson31July (vi) Subjecttoitem(vi)below, anemployeemayexercise hisoptionssubjecttothefollowinglimits: (v) t3 eebr170.5 do notconferanyrighttoparticipate inanyshareissueofothercompany. per shareunderESOS3remained unexercised. Theseoptionsremaininforce until31July2007.Theseoptionsgranted sharesofRM1eachattheoptionpriceRM7.09 At 31December2003,optionstosubscribefor170,456,000ordinary # Lessthan0.1million At 31December asd# Lapsed Exercised (sub-notec) Offered At 1January The Company 2007, suchcorrespondingalterationsshallbemadein: 0,0 n bv 02 02 20 — 20 — 20 **30 20 30 and/orthesubscriptionprice. 20 (ii) *40 10 thenumberofnewsharesinrelationtoESOSsofarasunexercised; (i) Percentageofoptionsexercisable(%) 30%ortheremainingnumberofoptionsunexercised ** * 100,000 andabove 20,000 –99,999 Below 20,000 Number ofoptionsgranted 40% or20,000options,whicheverishigher 31 DECEMBER 2003 Y a er2Ya er4Year 5 Year 4 Year 3 Year 2 ear 1 0———— Million 254.2 (83.7) 2003 — — SS3ESOS2 ESOS 3 ilo ilo Million Million Million 5. — — 254.2 5. — — 259.0 022002 2002 01 1.)(127.1) (16.0) (0.1) 47 5.)— (58.8) (4.7) — hs Phase1 Phase 2 48127.1 74.8 0 SHARECAPITAL (continued) 10. aur oMy20 .078 7.09 7.09 8.53 7.09 7.30-7.85 8.00-8.25 9.15-9.80 7.40-7.50 toMay2003 January September toDecember2002 June toAugust2002 toMay2002 January uet uy20 .580 7.09 7.09 7.09 7.95-8.05 8.25-8.60 7.70-7.75 Share premium(RMmillion) sharecapital–atpar(RMmillion) Ordinary October toDecember2003 August toSeptember2003 June toJuly2003 Numberofsharesissued Exerciseprice Fairvalueofshares at shareissuedate Exercise date Details relatingtooptionsexercised duringtheyearareasfollows: on theMalaysiaSecuritiesExchangeBerhaddaypriortoexercise oftheoptions. The fairvalueofsharesissuedontheexercise ofoptionsisthemeanmarketpriceatwhichCompany’s shareweretraded Fair valueatexercise dateofsharesissued(RMmillion) Proceeds receivedonexercise ofshareoptions(RMmillion) MsaeRM/share RM/share Million 509.9 688.2 593.6 2003 83.7 83.7 49.8 19.9 4.8 9.2 — — — Million 471.5 602.1 535.0 2002 63.5 58.8 63.5 4.6 0.1 — — — —

195 196 2 CONVERTIBLE BONDS 12. RESERVES 11. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS OA EEVS10,485.3 RM9,894.5 million(2002:RM9,593.9million)withoutincurringadditionaltaxation. of payment ofnetdividendsapproximatelyRM9,764.8million(2002:RM9,266.3million)outtotaldistributablereserves Act, 1967andtaxexemptincomeunderSection8oftheIncomeTax (Amendment)Act,1999 at31December2003tofrankthe Subject toagreementwiththeInlandRevenueBoard,CompanyhassufficienttaxcreditunderSection108ofIncomeTax TOTAL RESERVES b Theprinciplefeatures oftheEurobondswereasfollows: (b) ConvertibleBondsrepresentUSD359.9million(2002:million)Eurobondsdue2004whichhavebeen (a) Exchange Fluctuation Reserves arising Exchange FluctuationReserves Retained Profits from translationofforeignsubsidiaries/associates i)TheBondsconstitute,subjecttothenegativepledge,unsecuredobligationsofCompany. (iv) TheBondsbearinterestrateof4%perannumpayablesemi-annuallyinarrearsequalinstalmentson31 March (iii) Unlesspreviouslyredeemed, purchased andcancelledorconverted,eachBondwillberedeemedon3October2004 (ii) (i) fully redeemedon1August2003. carry interestasfromthelast payment dateimmediatelyprecedingtheofconversion. carry and 30Septemberineachyearduringthetenureondate ofmaturity. AnyBondsconvertedwillceaseto Company atanytimeonorafter21October1999theirprincipal amount,plusaccruedinterest. at itsprincipalamounttogetherwithaccruedinterest.TheBondsmay alsoberedeemed,inwholeorpart,bythe shareand withafixedrateofexchangeonconversionRM2.5553equalsUSD1. price ofRM15.60perordinary sharesofRM1eachtheCompanyataninitialconversion and including26September2004intofullypaidordinary Unless previouslyredeemedorpurchased andcancelled,theBondsareconvertibleonorafter3November1994upto 31 DECEMBER 2003 10,685.2 (199.9) 2003 RM H RU THECOMPANY THE GROUP 9,216.1 9,523.2 (307.1) 2002 RM 9,894.5 9,894.5 2003 RM — 9,593.9 9,593.9 2002 RM — 3 BORROWINGS 13. – Borrowingsfrom – RedeemableBonds Unsecured OA ORWNS53%1,3. 7. 11,708.4 877.8 10,830.6 5.35% TOTAL BORROWINGS T – NotesandDebentures Unsecured – Borrowingsfromfinancial Secured FOREIGN T – BorrowingsunderIslamic – Borrowingsfrom – Otherborrowings – Bankoverdrafts(sub-notee) – Bankoverdrafts(sub-notee) – Otherborrowings H RU fFnneR MRM RM RM ofFinance – BorrowingsunderIslamic – Borrowingsfromfinancial – CagamasLoans(sub-notea) Secured DOMESTIC THE GROUP tlFrin47%49367. 5,002.8 79.2 4,923.6 4.74% otal Foreign 6,705.6 798.6 5,907.0 5.80% otal Domestic financial institutions financial statements) (note 14tothe (sub-note d) institutions (sub-notec) Banking facilities financial institutions facilities (sub-noteb) institutions (sub-noteb) A eaeRt emTr Total Term Term verage Rate We 00%—313.1 3.1 — 10.00% .3 ,1. 024,857.4 40.2 4,817.2 4.73% 145.4 39.0 106.4 5.00% 4,777.4 534.5 4,242.9 5.32% 1,928.2 264.1 1,664.1 6.98% .5 5. 1. 1,072.6 518.7 3,000.0 — 553.9 3.85% 3,000.0 5.88% .7 ,6. 2,665.0 — 2,665.0 6.87% 143.0 36.6 106.4 5.04% 701.8 12.8 689.0 5.16% .1 . 2.4 2.4 — 2.61% 3.0 3.0 — 6.50% .5 ,9. 222,128.9 32.2 2,096.7 2.05% .4 554960.4 4.9 55.5 4.44% .1 471686.3 1.6 84.7 6.61% .2 ,5. 501,289.4 35.0 552.5 227.5 1,254.4 7.62% 325.0 5.55% gtdLn Short Long ighted 2003 A eaeRt emTr Total Term Term verage Rate fFnneR MRM RM RM of Finance W 55%—1. 12.4 12.4 — 15.53% ihe ogShort Long eighted .2 ,3. 9. 4,129.7 798.9 3,330.8 5.82% 105.5 17.7 87.8 5.75% 1,984.7 668.1 1,316.6 4.50% 95.0 3.3 91.7 6.65% .2 2. 5. 1,287.0 659.4 627.6 3.92% .1 ,2. ,8. 6,314.9 1,488.0 4,826.9 5.41% .2 ,1. 1. 4,235.2 816.6 3,418.6 5.82% 2,079.7 671.4 1,408.3 4.60% .8 ,4. 2,643.0 — 2,643.0 7.28% 97.1 12.0 85.1 5.99% 696.3 7.3 689.0 5.56% .5 . . 8.4 5.7 2.7 2.95% 1.4 1.4 — 7.90% .8 4. 8. 1,425.2 780.8 644.4 3.08% .8 345749.1 5.7 43.4 4.18% .5 173395.0 3.3 91.7 6.65% ———— ———— ———— 2002

197 198 3 BORROWINGS(continued) 13. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS H OPN fFnneR MRM RM RM ofFinance – CagamasLoans(sub-notea) Secured DOMESTIC THE COMPANY H RU MR RM RM RM The Group’s longtermborrowings THE GROUP OA ORWNS52%6421296,435.0 2.9 6,432.1 5.26% TOTAL BORROWINGS T – NotesandDebentures Unsecured FOREIGN T – Borrowingsfrom Unsecured – Borrowingsfrom – BorrowingsunderIslamic – Otherborrowings tlFrin46%4684134,659.7 1.3 4,658.4 4.66% 1,775.3 1.6 otal Foreign 1,773.7 6.84% otal Domestic After oneyearanduptofiveyears are repayableasfollows: After fiveyearsanduptoten After tenyearsanduptofifteen After fifteenyears(sub-notef) Banking facilities (sub-note d) financial institutions financial institutions 31 DECEMBER A eaeRt emTr Total Term Term verage Rate 2003 We .1 471686.3 1.6 84.7 6.61% .6 ,8. 1,689.0 — 1,689.0 6.86% 86.3 1.6 84.7 6.61% .7 ,6. 2,665.0 — 2,665.0 6.87% 689.0 — 1,000.0 689.0 — 5.19% 1,000.0 8.00% .1 ,8. 1,980.8 — 1,980.8 1.71% .0 261313.9 1.3 12.6 1.40% gtdLn Short Long ighted oetcFrinTotal Foreign Domestic ,0. ,2. 10,830.6 4,923.6 5,907.0 ,8. ,1. 5,303.1 2,919.9 2,383.2 ,0. ,4. 3,240.2 1,240.2 2,000.0 ,0. 981,019.8 19.8 1,000.0 2. 4. 1,267.5 743.7 523.8 2003 2003 A eaeRt emTr Total Term Term verage Rate fFnneR MRM RM RM of Finance W ihe ogShort Long eighted oetcFrinTotal Foreign Domestic .5 173395.0 3.3 91.7 6.65% .5 ,8. 5. 1,844.0 155.0 1,689.0 6.65% 95.0 3.3 91.7 6.65% .2 ,9. 2. 5,917.4 920.4 4,997.0 6.02% .1 ,1. 6. 3,978.4 762.1 3,216.3 5.71% 1,939.0 158.3 1,780.7 6.65% .8 ,4. 2,643.0 — 2,643.0 7.28% 689.0 — 689.0 1,155.0 155.0 5.59% 1,000.0 7.29% .2 5. 6. 1,314.1 760.0 554.1 2.62% .5 922121.3 2.1 19.2 2.65% ,0. ,1. 4,826.9 3,418.6 1,408.3 4. 5. 1,500.3 858.8 641.5 4. ,9. 2,039.5 1,796.5 243.0 2. 4. 1,266.9 743.1 523.8 MR RM RM RM — 2002 2002 0220.2 20.2 3 BORROWINGS(continued) 13. H OPN MR RM RM RM The Company’s longtermborrowings THE COMPANY The currencyexposureprofileofborrowingsisasfollows: d ConsistsofUSD200.0million7.125% Notesdue2005,USD300.0million7.875%Debentures2025and (d) (c) SyndicatedtermloanfacilitiesandIslamicPrivateDebtsecuritiesissuedbyCelcom(Malaysia) Berhad(Celcom),awholly (b) BorrowingsfromCagamas Berhadsecuredbywayofassignmentthetitlespropertiesrelatingtostaffhousingloans. (a) – Othercurrencies – JapaneseYen – USDollar – RinggitMalaysia After oneyearanduptofiveyears are repayableasfollows: After fiveyearsanduptoten After fifteenyears(sub-notef) After tenyearsanduptofifteen million 8.0%GuaranteedNotesdue 2010. financial statements). Secured bywayoffixedandfloatingchargeonproperty, plantandequipmentofcertainsubsidiaries(note19tothe 2004. have beenreleasedon4February and floatingchargeovertheassetsofCelcomincludingbutnotlimited toshareofitswhollyownedsubsidiariesCelcom into thosedesignatedbankaccountsforpurposesofinterestandprincipal repaymentsonly. Thepriorsecuritythroughfixed collection accountsanddesignatedbankwhichrequires Celcom todepositaproportionofitsexcesscashflows acquiredduringthe year.owned subsidiary Theborrowingsare securedbydeedofassignmentoverCelcom’s keybank oetcFrinTotal Foreign Domestic ,7. ,5. 6,432.1 4,658.4 1,773.7 ,0. 4. 1,743.7 743.7 1,000.0 7. ,6. 3,543.3 2,769.6 773.7 — — ,4. 1,143.9 1,143.9 2003 . 1.2 1.2 11,708.4 4,021.6 6,705.6 152.8 828.4 2003 RM H RU THECOMPANY THE GROUP 6,314.9 3,345.8 2,079.7 oetcFrinTotal Foreign Domestic 132.2 757.2 2002 ,8. ,1. 4,997.0 3,216.3 1,780.7 ,0. 4. 1,743.1 743.1 1,000.0 RM 3. 7. 1,308.3 770.6 537.7 4. ,0. 1,944.3 1,701.3 243.0 MR RM RM RM — 6,435.0 3,817.5 1,775.3 828.4 2002 2003 13.8 RM . 1.3 1.3 5,917.4 3,208.5 1,939.0 757.2 2002 12.7 RM

199 200 4 REDEEMABLEBONDS(UNSECURED)/PAYABLE TO ASUBSIDIARY 14. BORROWINGS(continued) 13. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS Redeemable Bonds(Unsecured) by Tekad Mercu THE GROUP company,Payable toasubsidiary RUSB THE COMPANY Listed belowaretheeffectsoftransactiontoGroupandCompany: T and RM1,000.0millionnominalvalue15-yearredeemableunsecuredbondsdue2018(Tranche 2)(collectivelyreferredtoas T purpose entityoftheCompany. by RUSBvidetheissuanceofRM2,987.0millionRPS(RUSBRPS)toTekad Mercu Berhad(Tekad Mercu), anotherspecial As partofanoverallcostefficientfundingstructure,thefundsforsubscriptionCompany’s RPSandbondswererais (collectively referredtoasTMbonds)RUSB. due 2013(Tranche 1)andRM1,000.0millionnominalvalue15-yearredeemableunsecured bondsdue2018(Tranche 2) Subsequently, on30December2003,theCompanyissuedRM1,983.5millionnominalvalue10-yearredeemableunsecuredbonds each overtheparvalueofRM0.01each. Class BRPS(TMB)toRebungUtamaSdn.Bhd.(RUSB),aspecialpurposeentityoftheCompany, atapremiumofRM0.99 On 12December2003,theCompanyissuedforcash1,000ClassARedeemablePreferenceShares(RPS)(TMRPSA)and f TheGroupandtheCompanyhaveoptiontoprepaytotaldomesticloanoutstandingofRM523.8million(2002: (f) Thebankoverdraftswereunsecuredandinterestspayableatrateswhichvariedaccording tothelenders’prevailing (e) ekad Mercu bonds)toinvestorson30December2003financethesubscriptionofRUSBRPS. ekad Mercu had,inturn,issuedRM2,000.0millionnominalvalue10-yearredeemableunsecuredbondsdue2013(Tranche 1) 15-year redeemableunsecuredbonds due2018(Tranche 2)(sub-notec) 10-year redeemableunsecuredbonds due2013(Tranche 1)(sub-notec) 15-year redeemableunsecuredbondsdue2018(Tranche 2)(sub-noteb) 10-year redeemableunsecuredbondsdue2013(Tranche 1)(sub-noteb) TM RPSBofRM1,000(sub-notea) TM RPSAofRM1,000(sub-notea) RM523.8 million)andRM1,000.0million(2002:respectivelyin2004. Consequently, bankoverdraftisnowclassifiedasborrowing.Thecomparative wasreclassifiedaccordingly. The cashandequivalentsbalancesheetcomponentwasredesignatedasbankbalancesduringtheyear. andfrom10.0%to18.5%(2002:13.5%18.0%)perannumforanoverseassubsidiary.subsidiary base lendingrates.Interestratesduringtheyearrangedfrom6.5%to6.9%(2002:8.9%)perannumforalocal 31 DECEMBER 2003 3,000.0 2,983.5 1,000.0 2,000.0 1,000.0 1,983.5 2003 RM — — ed 4 REDEEMABLEBONDS(UNSECURED)/PAYABLE TO ASUBSIDIARY (continued) 14. b TMBonds (b) TMRPSAandB (a) i)Thebondsarenotconvertible,transferableandtradeable. (iv) Thebondswillconstitutedirect,unconditionalandunsecuredobligationsoftheCompanyatalltimes rank (iii) Paymentofcoupononthebondsmayeitherbe: (ii) Unlesspreviouslyredeemed,purchased andcancelled,thebondsareredeemablebyCompany on30December (i) The principalfeaturesofthebondsissuedbyCompanytoRUSBareasfollows: BothRPSAandBdonothavefixedmaturitydatesmayberedeemedincashattheoptionofCompany (v) TheRPSisnotconvertibleandshallconferontheholderthereofanyrighttoparticipateareturninexcess (iv) Thenon-cumulativedividends,whendeclaredbytheBoardofDirectorsCompany, arepayableinarrearsatthe (iii) TMRPSAandBrankpari-passuamongstthemselvesbutbelowtheSpecialShareaheadofordinary (ii) Thepreferenceshares,1,000RPSAandBarebothissuedatRM0.01parvalueapremiumofRM0.99 (i) The salienttermsoftheRPSareasfollows: on thesepreferencesharesarerecognisedintheIncomeStatementasinterestexpense. TM RPSAandBissuedbytheCompanytoRUSBhavebeenclassifiedasliabilitiesaccordingly, dividends (b) – net dividendsonbothTMRPSAandB,whichshallbeequaltotheinterest Tranche – 1andTranche (b) –interestof6.25% perannumpayablesemi-annuallyinarrearsontheTranche 1bonds,and (a) the transactiondocuments. present andfutureunsecuredunsubordinatedobligationsofthe Company, subjecttothosepreferredbylawor pari-passu, withoutdiscrimination,preferenceorpriorityamongst themselves andatleastpari-passuwithallother may alsoberedeemedbytheCompanyatanytimeafterissuedateprivatearrangementwithRUSB. 2013 and28December2018respectivelyatnominalamounttogetherwithaccruedunpaidinterest.Thebonds at anytime,aredemptionpriceofRM1pershare. price ofRM1.00foreachRPSAandB. oftheCompany,of capitalonliquidation,windinguporotherwise otherthanonredemption,uptotheredemption which willbeatthediscretionofDirectors. six(6)monthperiodcommencingfromthedateofissueRPS12December2003, the amount end ofevery shares oftheCompanyinadistributioncapitaleventwindinguporliquidationCompany. each. – anominalinterestof0.005%perannumpayablesemi-annually. interest of5.25%perannumpayablesemi-annuallyinarrearsontheTranche– 2bonds,withtheoptiontoreset collections ofdividendsandtaxrefundsbytheauthorities, 2 ofthebondslessanyamountsinDesignatedAccounts, being accountsdesignatedtocaptureall these ratesafterthefifthyear;or

201 202 4 REDEEMABLEBONDS(UNSECURED)/PAYABLE TO ASUBSIDIARY (continued) 14. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS None oftheTMRPS,bonds and Tekad Mercu bondshavebeen redeemed,purchased orcancelledduringthefinancialyear. Tekad MercuBonds (c) vi TheCompanyhasgrantedaPutOption infavourofthesecuritytrusteebondsforbenefitholders (vii) Thebondsarenotconvertiblebuttransferable,subjecttocertainsellingrestrictions. (vi) Thebondswillconstitutedirect,unconditionalandunsecuredobligationsofTekad Mercu andwillatalltimesrank (v) Paymentofcoupononthebonds (iv) Thebondsmayalsobepurchased, in wholeorinpart,bytheCompany, atanytimepriceintheopenmarket (iii) InrespectofTranche 2only, (ii) Unlesspreviouslyredeemed,purchased andcancelled,thebondsareredeemablebyTekad Mercu on30December (i) The principlefeaturesofthebondsissuedbyTekad Mercu areasfollows: c aneventofdefaulthasbeendeclaredunderthePutOption. (c) aneventofdefaulthasbeendeclaredunderthebonds;and (b) onapre-agreedtime frame,thereisinsufficientamountsintherelevantDesignatedAccounttomeetcoupon (a) Ifonthedayfalling20business dayspriortoanyOptionalRedemptionDate,theratingofTekad Mercu (b) Tekad Mercu hastherighttoredeemallofoutstandingTekad Mercu bonds(Tranche 2)onthe10thand (a) following circumstances: of thebonds.ThePutOptionwillallowholdersbonds tohavedirectrecourseontheCompanyfor the transactiondocuments. present andfutureunsecuredunsubordinatedobligationsofTekad Mercu, subjecttothosepreferredbylawor pari passuwithoutdiscrimination,preferenceorpriorityamongstthemselvesandatleastpari-passuwithallother annum payablesemi-annuallyinarrearsontheTranche 2bondswiththeoptionofresettheseratesafterfifthyear. Interest rateof6.20%perannumpayablesemi-annuallyinarrearsontheTranche 1bondsandinterestrateof5.25%per or byprivatetreaty. 2013 and28December2018respectivelyatnominalamounttogetherwithaccruedunpaidinterest. payments and/orprincipalredemptionofthebondsonrelevant duedateforpayment; interest (uptobutexcludingtherelevantOptionalRedemptionDate)inrespectthereof. Date. RedemptionoftheTekad Mercu bonds(Tranche 2)shall beattheirnominalvaluetogetherwithallaccrued shall beobligedtoredeemalloutstandingTekad Mercu bonds(Tranche 2)ontherelevantOptionalRedemption bonds (Tranche 2)shallbebelowAAAoritsequivalentasconfirmedbytheCalculationAgent,thenTekad Mercu in respectthereof. amount togetherwithaccruedandunpaidinterest(uptobutexcludingtherelevantOptionalRedemptionDate) 20th couponpaymentdate(‘OptionalRedemptionDate’)withadvancenoticetothebondholdersatnominal 31 DECEMBER 2003 5 HEDGINGTRANSACTIONS 15. b Cross-currencyInterestRate Swap(CCIRS) (b) LongDatedSwap (a) final redemptionamountbelessthanthat,therewouldawrite-back ofanyover-accrued amount. instrument withtheassumptionoffinalredemptionamountbeing themaximumamountpayable.However, shouldthe The Companyhasrecognisedthemaximumcouponrepaymentbased onaconstantrateofreturnoverthelife between aminimumofJPY6,080.0millionpluscouponrepaymentmaximumJPY1,520.0million. dependent ontheUSD/JPYexchangeratedateofmaturity, neverthelessthefinalredemptionamountisrangebound JPY liabilityof1.25%perannumwithapremiumonredemption.Thetheredemptionlegis 1999 to1August2005.TheeffectofthetransactionisconvertUSD50.0millionfixedrateNotesa In 1999,theCompanyenteredintoaCCIRS,onUSD50.0milliontrancheofaboveNotes,forperiodfrom5March Hedging Instrument In 1995,theCompanyissuedUSD200.0million7.125%Notesdue2005.Theareredeemableinfullon1August USD200.0 million7.125%NotesDue2005 Underlying Liability sinking fundwithanassuredvalueofUSD300.0millionon1August2025fortherepaymentDebentures. USD300.0 million7.875%redeemableunsecuredDebentures.Theeffectofthistransactionistoeffectivelybuildupa USD300.0 millionatapre-determinedexchangerateofRM2.5toUSD1.0,whichwillbeusedfortherepayment On 1August2025,theCompanywillreceiveRM750.0millionfromcounter-party. Theseproceedswillbeswappedfor agreed withthecounter-party. However, theCompanyintendstoholdcontract tomaturity. 2004,theCompanyhasrighttoterminatetransactionat aratemutually transaction. Commencingfrom1February 2004,thecounter-partyPrior to1February isnotobligedtoagreeanyrequestbytheCompanyterminate and1August,uptoincludingAugust2025. on each1February The CompanymadeapaymentofUSD5.0millionandisobligedtopayfixedamountsJPY209.9semi-annually Hedging Instrument In 1998,theCompanyenteredintoalongdatedswap,whichwillmatureon1August2025. USD300.0 million7.875%DebenturesDue2025 Underlying Liability

203 204 5 HEDGINGTRANSACTIONS (continued) 15. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS d InterestRateSwap(IRS) (d) Cross-currencyInterestRateSwap(CCIRS) (c) 6-month USDLiborplus5.10%.Theswapwillmatureon7December 2005. million thatentitlesittoreceiveinterestatfixedrateof8.0%per annum andobligesittopayinterestatfloatingrateof On 29October2003,theCompanyenteredintoaninterestrateswap (IRS)agreementwithnotionalprincipalofUSD150.0 Hedging Instrument December 2010. In 2000,theCompanyissuedUSD300.0million8.0%Guaranteed Notes due2010.Theareredeemableinfullon7 USD300.0 million8%GuaranteedNotesDue2010 Underlying Liability USD floatinginterestwithareducedmargin,calculatedonnotionalprincipalofUSD150.0million. interest payableontheUSD150.0milliontrancheofsyndicatedtermloan.TheCCIRSisnowa The objectiveofthistransactionistoeffectivelyconverttheUSDliabilityintoaJPYprincipalliability, andtoreducethe debt obligationintoJPYattheprincipalexchangerateofJPY115.4933maturitydate29June2007. at 6-monthUSDLiborless1.504%perannum.TheneteffectoftheCCIRSistoconvertCompany’s USD150.0million The restructuredswapentitlestheCompanytoreceivefloatinginterestat6-monthUSDLibor, andobligesittopayinterest payment ofJPY17,324.0milliononmaturitytheUSD150.0tranchesyndicatedtermloan29June2007. restructured swaphasthefollowingnewtermswhereby, theCompany willreceiveUSD150.0millioninreturnforthe On 26July2001,theCompanyrestructuredexistingUSD200.0millionIRSintoaUSD150.0CCIRS.The 2005. interest ratepayablerevertstoafloatingrate.Theswapwasscheduledmatureon14January 6.75% perannumaslonginterestratesarebelow7.25%annum.Ifmarketexceedthatlevel,the annum. TheeffectofthistransactionistofixtheinterestratepayableonUSD200.0millionaboveUSDloan, the floatingrateinterestreceivablefromcounter-party haseffectivelybeenlimitedtoamaximumrateof7.25%per of 7.25%perannumonthefloatingratelegremainingUSD200.0millionnotionalamountIRS.Withcap, The CompanyunwoundUSD200.0millionnotionalprincipaloftheswapatzerocostbyembeddinganinterestrate’cap’ entitles ittoreceiveinterestatfloatingrateandobligespayfixedof6.75%perannum. In 1998,theCompanyenteredintoaninterestrateswap(IRS)agreementwithnotionalprincipalofUSD400.0millionthat Hedging Instrument USD200.0 millionhasbeenfullypaidduringtheyear. comprising USD200.0milliondueon30June2003andUSD150.0292007.Thefirsttrancheof rates, tomatureon11May2003.Duringtheyearended31December2000,facilitywasrefinancedintotwotranches In 1998,theCompanyenteredintoa5-yearUSD350.0millionunsecuredsyndicatedtermloan,payinginterestatfloating USD150.0 million(2002:USD350.0million)UnsecuredSyndicatedTerm Loan Underlying Liability 31 DECEMBER 2003 7 DEFERREDTAX 17. CUSTOMERS’ DEPOSITS 16. Amount includedunderotherpayables OA UTMR’DPST 626.9 to alignwiththeGroupbusinesssegmentfollowingacquisitionofCelcom. hasbeenreclassifiedtoother payablesprimaril The comparativefigureinrespectofcustomers’depositsforCellularservices T TOTAL CUSTOMERS’DEPOSITS OA EERDTX1,871.1 TOTAL DEFERREDTAX offsetting, areshowninthebalancesheet: tax liabilitiesandwhenthedeferredtaxesrelatetosameauthority. Thefollowingamounts,determinedafterappropria Deferred taxassetsandliabilitiesareoffsetwhenthereisalegallyenforceable righttosetoffcurrenttaxassetsagainst Cellular services Others Data services T Deferred taxassets Deferred taxliabilities: elephone customers’depositsaresubjectedtorebateat5%perannuminaccordancewithTelephone Regulations,1996. elephones Subject toincometax 2,031.5 (156.7) 783.6 156.7 592.2 160.4 2003 2003 32.4 RM RM 2.3 H RU THECOMPANY THE GROUP H RU THECOMPANY THE GROUP 1,590.3 1,590.3 704.5 625.5 590.6 (79.0) 2002 2002 79.0 32.6 RM RM 2.3 — 1,694.6 1,694.6 614.9 614.9 580.2 2003 2003 32.4 RM RM 2.3 — — — 1,533.6 1,533.6 614.4 614.4 579.5 current 2002 2002 32.6 RM RM 2.3 — — — te y

205 206 7 DEFERREDTAX (continued) 17. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS temporary differencesandtaxlossescan beutilised. temporary arerecognisedinthecurrent yearasitisprobablethattherewillbefuturetaxableprofitsavailableagainstwhi subsidiary differencesandtaxlossesof RM160.4 millionofa The deferredtaxassetswhichrelatetopreviouslyunrecognisedtemporary b DeferredTax Liabilities (b) a DeferredTax Assets (a) – others – intangibleassets – property, plantandequipment Current yearchargedtoIncomeStatementarisingfrom: At 1January, asrestated t3 eebr2,031.5 At 31December Currency translationdifferences T 160.4 – acquisitionofasubsidiary Current yearchargeddirectlytoequityarisingfrom: T At 31December T At 1January – others – taxlosses – property, plantandequipment Current yearcreditedtoIncomeStatementarisingfrom: otal chargeddirectlytoequity otal chargedtoIncomeStatement otal creditedtoIncomeStatement (note 42tothefinancialstatements) 31 DECEMBER 2003 1,590.3 179.5 238.3 238.3 202.8 160.4 2003 14.0 48.8 46.5 65.1 RM 9.3 0.1 — H RU THECOMPANY THE GROUP 1,388.2 1,590.3 228.7 202.6 (26.1) 2002 (0.5) RM — — — — — — — — — 1,533.6 1,694.6 154.8 161.0 2003 14.0 (7.8) RM — — — — — — — — — 1,361.3 1,533.6 ch such 198.4 172.3 (26.1) 2002 RM — — — — — — — — — — 7 DEFERREDTAX (continued) 17. Breakdown of cumulative balances by each type of temporary difference: Breakdown ofcumulativebalancesbyeachtypetemporary recognised inthebalancesheetareasfollows: differencesandunutilisedtaxlossesofsubsidiariesforwhichnodeferredassetis The amountofdeductibletemporary b DeferredTax Liabilities (b) Deductible temporary differences Deductible temporary T a DeferredTax Assets (a) ax losses Others Offsetting Offsetting Other intangibleassets Property, plantandequipment T T Others T Property, plantandequipment tlDfre a iblte fe fstig2,031.5 otal DeferredTax LiabilitiesAfterOffsetting 160.4 otal DeferredTax AssetsAfterOffsetting ax losses 2,840.6 2,809.6 (809.1) (809.1) 969.5 171.2 751.8 2003 17.0 14.0 46.5 RM H RU THECOMPANY THE GROUP 1,590.3 1,705.0 1,705.0 (114.7) (114.7) 114.7 114.7 2002 RM — — — — — 1,694.6 1,817.1 1,803.1 (122.5) (122.5) 122.5 637.1 324.3 312.8 122.5 2003 2003 14.0 RM RM — — — — THE GROUP 1,533.6 1,648.3 1,648.3 (114.7) (114.7) 114.7 883.7 350.2 533.5 114.7 2002 2002 RM RM — — — — —

207 208 8 INTANGIBLE ASSETS 18. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS e okVle—5. 50.0 50.0 50.0 — 50.0 — 50.0 50.0 39.7 — — (39.7) 4,072.7 39.7 (39.7) 50.0 — — 4,022.7 Net BookValue (39.7) (39.7) Cost (39.7) At 31December2003 — 4,072.7 At 31.12.2003 39.7 Acquisition of3Gspectrumlicence 50.0 At 1.1.2003 (39.7) Net BookValue — THE COMPANY 4,022.7 Net BookValue, asrestated 39.7 Accumulated impairment,asrestated Cost, asrestated At 31December2002 Net BookValue Accumulated impairment Cost At 31December2003 At 31.12.2002,asrestated Impairment, asrestated Acquisition ofasubsidiary, asrestated At 1.1.2002 At 31.12.2003 custo f3 pcrmlcne—5. 50.0 50.0 — 2,814.8 — 2,814.8 Acquisition of3Gspectrumlicence (note2tothefinancialstatements) Acquisition ofasubsidiary T At 1.1.2003 Net BookValue THE GROUP aserdfo soits(oe2 otefnnilsaeet)1279—1,207.9 — 1,207.9 ransferred fromassociates(note21tothefinancialstatements) 31 DECEMBER 2003 odilAst Total Assets Goodwill ,6. 004,112.4 50.0 4,062.4 MR RM RM RM — ——— ——— ——— ——— ——— Intangible Other 0050.0 50.0 9 PROPERTY, PLANTANDEQUIPMENT 19. maret(02 40 50 (99.2) (5.8) — (10.6) — (3,551.3) — — — — — (0.6) 2,678.7 — (121.7) (1,478.8)* (2.0) (5.0) (1.1) 19,566.5 3,084.8 — 252.9 2,932.9 (4.0) (0.1) (733.4) 181.5 78.8 (0.2) 2,971.5 (129.6) (2.5) (90.2) 75.2 455.5 836.6 (2,565.5) (5.6) (5.4) 31.9 771.7 195.2 143.1 278.2 2,794.0 Impairment Depreciation 70.1 12,156.7 Currency translation Write off Disposals 2,583.0 T Additions Acquisition ofasubsidiary At 1.1.2003 Net BookValue ransfer toinventories ifrne 1.)(.)(.)0603—(10.0) — (47.2) 0.3 — 0.6 — (0.2) — (0.2) — (10.5) — (47.2) differences financial statements) (note 24tothe cuuae maret(7.)(.)(.)———(487.5) 46,863.7 — 1,635.6 — 4,389.8 (24,770.3) 21,605.9 570.7 — — 1,635.6 3,726.9 3,177.6 (1,212.2) (5.0) 1,465.3 563.7 (7.0) 35,075.4 (4.0) 1,012.7 (2,709.2) 407.0 (1,054.3) (478.5) (19,787.6) 14,809.3 Accumulated impairment Accumulated depreciation Cost At 31December2003 At 31.12.2003 THE GROUP cuuae maret(8.)—————(388.3) 19,566.5 — 41,746.0 2,932.9 (50.9) 2,932.9 (6.7) — 2,971.5 4,069.3 — (21,791.2) 19,566.5 (2,481.8) 455.5 — 461.4 — — 2,932.9 — 12.0 771.7 — 3,185.1 2,749.1 2,971.5 (0.5) (1,097.8) — 278.2 — (113.5) (1,316.1)* 455.5 1,229.2 18,926.7 — (5.9) (0.7) (0.2) 1,379.1 4,249.0 12,156.7 — 30,304.1 771.7 — (1,977.4) 49.4 — — 1,706.3 (360.7) 21,605.9 (951.0) 278.2 (388.3) * Netoftransfer toproperty, plantandequipment — 406.4 (81.0) 549.5 1,635.6 (0.2) (17,759.1) (4.8) Net BookValue 12,156.7 3,177.6 583.0 129.4 (1,926.4) Accumulated impairment 0.2 (50.7) Accumulated depreciation (0.7) 563.7 Cost 234.8 At 31December2002 2,393.8 0.4 1,012.7 At 31.12.2002 11,747.2 407.0 Depreciation 11.4 Currency translation 14,809.3 Write off Disposals Additions Acquisition ofasubsidiary At 1.1.2002 Net BookValue ifrne 1.)(.)(.)0601—(17.9) — 0.1 0.6 (0.3) (0.4) (17.9) differences omncto ln n upr ada otPlantand atCost Land Support Plantand communication ewr qimn ytm sbnt )Bidns(u-oeb Equipment (sub-noteb) Buildings (sub-notea) Systems Equipment Network T l-MvbeCmue nPors,Property, In-Progress, Computer Movable ele- MR MR MR RM RM RM RM RM RM RM aia ok Total Capital Work-

209 210 9 PROPERTY, PLANTANDEQUIPMENT(continued) 19. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS rt f 46 02 (4.8) (5.9)# — — (2,490.9) — 1,820.0 — — (1,052.4)* 15,251.0 — — (103.2) 2,394.1 236.2 (0.5) — 2,169.4 72.8 (0.2) 292.3 (561.3) (0.2) 691.0 — (70.0) 503.7 132.8 (4.6) (5.7) (1,755.9) 172.4 1,739.6 9,719.1 Depreciation Write off Disposals Additions At 1.1.2003 Net BookValue financial statements): Net bookvalueofproperty, plantandequipmentofcertainsubsidiariespledgedassecurityforborrowings(note13(c)tothe e okVle96252506323462324131714,569.4 36,718.2 1,341.7 1,341.7 2,302.4 3,361.7 (22,148.8) 14,569.4 364.6 370.7 — 1,341.7 633.2 2,807.0 2,302.4 (1,059.3) 235.0 364.6 1,047.4 (6.1) 27,789.7 9,692.5 633.2 (2,173.8) (812.4) 235.0 (18,097.2) 9,692.5 Net BookValue Accumulated depreciation Cost At 31December2003 At 31.12.2003 THE COMPANY Movable plantandequipment Computer supportsystems Land Buildings T elecommunication network omncto ln n upr adI-rges Plantand In-Progress, Land Support Plantand communication 31 ewr qimn ytm sbnt )Bidnsa otEquipment atCost Buildings (sub-notea) Systems Equipment Network DECEMBER T l-MvbeCmue aia ok Property, CapitalWork- Computer Movable ele- 2003 MR MR MR RM RM RM RM RM RM RM 393.4 383.2 2003 RM 5.5 1.8 1.1 1.8 282.0 272.8 2002 T otal RM 5.0 1.4 0.9 1.9 9 PROPERTY, PLANTANDEQUIPMENT(continued) 19. rt f 5.)(.)————(50.9) — (2,088.3) (778.9)# 2,158.3 — — (557.0) (691.6)* 16,010.8 — (19.2) (77.9) 876.5 3,642.7 (86.4) (0.5) 1.2 — 1,390.0 (76.9) 378.0 (268.5) 421.4 (0.2) (6.7) (49.6) 427.7 99.7 (50.7) (1,691.8) (32.7) 129.2 1,451.1 10,043.2 Depreciation Write off Disposals Additions At 1.1.2002 ot2,2. 4. ,1. 9. ,3. ,9. 35,211.4 15,251.0 2,394.1 2,394.1 2,169.4 3,131.6 (19,960.4) 15,251.0 292.3 297.9 — 2,394.1 503.7 2,119.7 2,169.4 (962.2) 941.5 172.4 292.3 (5.6) 26,326.6 9,719.1 503.7 Detailsofland(atcost)areasfollows: (1,616.0) (a) (769.1) 172.4 # * Netoftransfertoproperty, plantandequipment (16,607.5) 9,719.1 Net BookValue Accumulated depreciation Cost At 31December2002 At 31.12.2002 THE COMPANY b Includedinthecapitalwork-in-progressisfinancecostcapitalised fortheyearamountingtoRM5.7million(2002:RM5.2 (b) Included indisposalswasRM0.6million(2002:RM774.3million)beingproperty, plantandequipmenttransferredtosubsidiari Other land million) fortheGroup. finalisation withtherelevantauthorities,theselandhavenotbeen classified accordingtotheirtenure. The titledeedspertainingtootherlandhavenotyetbeenregistered inthenameofCompanyandasubsidiary. Pending Short termleasehold Long termleasehold Freehold land omncto ln n upr adI-rges Plantand In-Progress, Land Support Plantand communication ewr qimn ytm sbnt )Bidnsa otEquipment atCost Buildings (sub-notea) Systems Equipment Network T l-MvbeCmue aia ok Property, CapitalWork- Computer Movable ele- MR MR MR RM RM RM RM RM RM RM 570.7 213.2 256.4 2003 94.0 RM 7.1 H RU THECOMPANY THE GROUP 461.4 130.3 254.5 2002 73.3 RM 3.3 370.7 178.8 2003 93.6 92.5 RM 5.8 297.9 130.3 2002 T 73.1 92.5 otal RM 2.0 es

211 212 0 SUBSIDIARIES 20. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS H OPN MR RM RM RM Investments, atwrittendownvalue: Investments, atcost: THE COMPANY OA NEETI USDAIS1,6. 5. 10,926.2 558.9 10,367.3 Market valueofquotedinvestment TOTAL INTERESTINSUBSIDIARIES 43 tothefinancialstatements. The Group’s equityinterestinthesubsidiaries,theirrespectiveprincipalactivities andcountriesofincorporationareliste Theamountowing by subsidiariesrepresentsshareholderloansandadvancesforworkingcapitalpurposes.These (b) InvestmentsincertainsubsidiarieshavebeenwrittendowntorecoverableamountorRM1each. (a) Amount owingbysubsidiaries Allowance forloansandadvances – unquoted(sub-notea) – quoted – unquoted (sub-note b) Shareholder loansandadvancesprovidedtooverseassubsidiaries are inUSdollar. terms. However, theCompanyhasindicatedthatitwillnotdemandsubstantialrepaymentwithinnexttwelvemonths. and advancesareunsecuredbearinterestrangingfrom0%to4.72%(2002:4.88%)withnofixedrepayment to writtendownvalueasexplainedinnote2thefinancialstatements. During theyear, wasdisposedtoCelcomforaconsiderationequivalent TMCellularSdn.Bhd.,awhollyownedsubsidiary 31 DECEMBER 2003 aasaOesa Total Overseas Malaysia 088458911,437.3 558.9 10,878.4 036539710,776.2 379.7 10,396.5 511 (511.1) — (511.1) 6. 7. 641.6 179.2 462.4 8. 7. 661.1 179.2 481.9 95—19.5 — 19.5 67—66.7 — 66.7 ——— 2003 aasaOesa Total Overseas Malaysia ,8. 1,684.4 — 1,684.4 ,7. 2. 6,993.5 521.4 6,472.1 ,7. 7. 2,353.6 179.2 2,174.4 ,7. 2. 7,399.6 521.4 6,878.2 ,0. 4. 5,046.0 342.2 4,703.8 461 (406.1) — (406.1) 7. 7. 649.7 179.2 470.5 95—19.5 — 19.5 29—72.9 — 72.9 MR RM RM RM 2002 d innote 1 ASSOCIATES 21. i Quoted (i) i)Unquoted (ii) Share ofnetassetsotherthan Goodwill onconsolidation, H RU MR RM RM RM THE GROUP note 44tothefinancialstatements. The Group’s equityinterestintheassociates, theirrespectiveprincipalactivitiesandcountriesofincorporation arelisted (a) Market valueofquotedinvestments T Investments, atcost: THE COMPANY Market valueofquotedinvestments T Share ofnetassetsotherthan tl15—1.5 — 1.5 1,499.6 1,422.9 76.7 otal otal – onacquisition goodwill ofassociates as restated(sub-notea) – postacquisition – quoted – unquoted – onacquisition goodwill ofassociates – postacquisition – associatesofasubsidiary goodwill wasnotrestatedasitis impracticaltodoso. intheyearofacquisition. Such 2002waswrittenoffagainst reserves from acquisitioncompletedprior to 1January 2002isreflectedaspartoftheinvestmentinassociates.Goodwillarise associates ariseonorafter1January In linewiththechangeinaccountingpolicyrespecttogoodwill onacquisition,goodwillacquisitionof acquired duringtheyear aasaOesa Total Overseas Malaysia 673. 109.6 32.9 76.7 432. 103.5 29.2 74.3 05 . 3.2 3.7 (0.5) . 1.5 — 1.5 . 2.9 — 2.9 ——— — — — ——— — ——— 2003 ,9. 1,390.0 1,390.0 ,0. 2,808.9 2,808.9 2. 520.8 869.2 520.8 869.2 aasaOesa Total Overseas Malaysia ,0. 1,207.9 — 1,207.9 ,3. ,0. 2,746.5 1,107.3 1,639.2 ,3. 1,639.1 — 1,639.1 ,1. 601,528.5 16.0 1,512.5 4. 98506.6 59.8 446.8 0. 101.1 — 101.1 1.)(98 (75.4) (59.8) (15.6) 571. 96.0 10.3 85.7 42—84.2 — 84.2 28 8. 284.8 287.6 (2.8) MR RM RM RM . 0311.8 10.3 1.5 . ,0. 1,107.4 1,107.3 0.1 . 1. 822.6 819.7 2.9 ——— 2002 in

213 214 3 LONG TERMRECEIVABLES 23. INVESTMENTS 22. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS Other longtermreceivables(sub-notec) Staff loansreceivablewithintwelve months Allowance forpermanentdiminutioninvalue OA OGTR EEVBE 668.9 TOTAL LONGTERMRECEIVABLES T 384.7 Market valueofquotedinvestments TOTAL INVESTMENTSAFTERALLOWANCE (a) The following corporations in which Celcom Group, a subsidiary acquiredduringtheyear, ThefollowingcorporationsinwhichCelcomGroup,asubsidiary ownedmorethanonehalfofthe (a) Staff loans Staff loansunderIslamicprinciples Investments inunquotedshares,atwrittendown Investments inunquotedshares,atcost Investments inquotedshares,atcost Investments inInternationalSatelliteOrganisations,atcost otal staffloans(sub-notea&b) included underotherreceivables value (sub-notea) Investments intheabovecorporationshavebeenwrittendowntorecoverableamountorRM1each. voting power, which,duetolossofcontrolorsignificantinfluencehavebeenaccountedasinvestments. – Tripoly CommunicationTechnology CorporationLtd. – TRITelecommunication ZanzibarLimited – TRICellularCommunicationsCambodiaCompany – AseaniaPlasticsSdn.Bhd. 31 DECEMBER 2003 (100.3) 737.5 482.0 769.2 267.4 262.0 475.5 109.9 264.8 107.3 (97.3) 2003 2003 31.7 RM RM — H RU THECOMPANY THE GROUP H RU THECOMPANY THE GROUP 763.5 229.9 784.7 685.4 139.6 331.8 431.7 133.5 (90.3) (99.3) 2002 2002 21.2 96.4 RM RM — — — 737.0 435.4 768.7 267.4 668.8 338.1 261.5 475.5 264.8 106.3 (97.3) (99.9) 2003 2003 31.7 64.3 RM RM — 763.4 188.6 783.9 684.6 331.7 431.7 132.6 (90.3) (99.3) 2002 2002 20.5 98.3 56.0 RM RM — — — 4 INVENTORIES 24. LONG TERM RECEIVABLES (continued) 23. (c) StaffloansamountingtoRM82.7 million(2002:RM92.8million)havebeenassignedtosecuretheCompany’s borrowings (b) Staffloanscomprisehousing,vehicle,computerandclubmembershipofferedtoemployees withfinancingcostof (a) OA NETRE 203.6 TOTAL INVENTORIES T At netrealisablevalue: Spares andothers Spares andothers T Network materials Cables andwires At cost: elecommunication equipmenttransferredfromproperty, elecommunication equipment plant andequipment(note19tothefinancialstatements) scholarship willberepayableoveraperiodofnotmorethan8years. criteriaaremet.Theloansinterestfreeandifnotconvertedto convertible toscholarshipsifcertainperformance Other longtermreceivablesoftheCompanyareinrespecteducationloansprovidedtoundergraduatesand from CagamasBerhad. Computerloans–3years (iii) Vehicle loans–maximumof8yearsfornew car and6yearsforsecondhand Housingloans–25yearsoruponemployeesattaining55ofage,whicheverisearlier (ii) (i) are repayableinequalmonthlyinstalmentsasfollows: no singlesignificantexposureastheamountismainlyreceivablefromindividuals.Staffloansinclusiveoffinancingcost 4.0% perannumonreducingbalancebasisexceptforclubmembershiploanswhicharefreeoffinancingcost.Thereis 121.1 2003 82.5 47.2 35.3 40.0 18.5 32.4 30.2 RM H RU THECOMPANY THE GROUP 131.0 172.5 2002 41.5 41.5 37.4 24.3 30.6 38.7 RM — 103.3 103.3 2003 23.6 17.1 32.4 30.2 RM — — — 105.7 105.7 2002 16.7 21.1 29.2 38.7 RM — — —

215 216 5 TRADEANDOTHER RECEIVABLES 25. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS Other receivablesfromsubsidiaries(sub-notea) Staff loans Other receivablesfromassociates(sub-notea) Allowance fordoubtfuldebts Other receivables Advance rentalbillings Allowance fordoubtfuldebts – RinggitMalaysia The currencyexposureprofileoftradeandotherreceivables 3,835.0 TOTAL TRADEANDOTHERRECEIVABLES AFTERALLOWANCE T Prepayments T – GuineaFranc – GoldFrancCurrency – SpecialDrawingRights – USDollar Deposit foradditionalinvestment(refertonote36(a) – Othercurrencies Receivables fromsubsidiaries Receivables fromnon-telephonecustomers Receivables fromtelephonecustomers otal otherreceivablesafterallowance otal tradereceivablesafterallowance after allowanceisasfollows: to thefinancialstatements) 31 DECEMBER 2003 (1,443.5) 4,306.7 3,835.0 3,894.5 2,870.2 1,384.0 2,451.0 1,754.6 2,552.1 (412.2) 190.0 100.3 496.1 590.3 121.5 560.0 113.4 (23.9) 2003 31.2 94.4 75.5 RM — — H RU THECOMPANY THE GROUP (1,151.2) 4,036.9 3,592.4 3,542.5 2,617.2 1,201.1 2,391.3 3,592.4 1,678.9 2,358.0 (494.4) 190.0 343.3 574.4 110.4 660.4 2002 99.3 29.9 83.9 90.6 (6.3) RM 0.4 — — 3,028.3 3,104.5 2,579.4 2,506.4 1,173.8 1,930.7 3,104.5 1,284.0 1,351.7 (448.9) (648.7) 190.0 296.7 540.1 426.6 392.6 2003 99.9 52.3 75.5 96.0 (8.6) RM 3.4 — — 3,010.2 2,942.6 2,487.4 2,262.8 1,084.1 1,858.5 2,942.6 1,224.8 1,459.0 (522.8) (628.9) 190.0 254.9 528.0 566.0 326.4 2002 99.3 17.3 29.9 83.9 (5.8) RM 0.4 — — 6 SHORT TERMINVESTMENTS 26. TRADEANDOTHER RECEIVABLES (continued) 25. a Otherreceivablesfromsubsidiariesandassociatesareunsecuredinterestfreewithnofixedrepaymentterms. (a) Credit termsoftradereceivablesrangefrompaymentinadvanceto90daysyear2003and2002. Company considertheallowancefordoubtfuldebtsatbalancesheetdatetobeadequatecoverpotentialfinancialloss. credit riskismitigatedtoacertainextentbycashdepositsandbankers’guaranteeobtainedfromcustomers.TheGroupthe The GroupandtheCompanyarenotexposedtomajorconcentrationsofcreditriskduediversedcustomerbase.Inaddition into accountanycollateraltaken: The followingtablerepresentscreditriskexposureoftradereceivables,netallowancesfordoubtfuldebtsandwithouttaki OA HR EMIVSMNS263.4 Market valueofquotedshares TOTAL SHORT TERMINVESTMENTS Shares quotedontheMalaysiaSecuritiesExchangeBerhad Subsidiaries Residential Business 2,451.0 1,562.4 263.4 263.4 888.6 2003 2003 RM RM — H RU THECOMPANY THE GROUP H RU THECOMPANY THE GROUP 2,391.3 1,638.9 197.7 197.7 197.7 752.4 2002 2002 RM RM — 1,930.7 1,075.4 260.3 260.3 260.3 462.7 392.6 2003 2003 RM RM 1,858.5 1,076.8 197.7 197.7 197.7 455.3 326.4 2002 2002 RM RM ng ,

217 218 7 CASHANDBANKBALANCES 27. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS (2002: 2.32%)and1.62% 1.94%)fortheGroupandCompanyrespectively. The weightedaverageinterestrate ofdeposits(excludingunderIslamicprinciples)asat31 December2003is2.38% are depositsheldatcallwithbanks. and fromovernightto90days(2002:94days) fortheGroupandCompanyrespectively. Bankbalances in anysinglefinancialinstitution.Depositshavematurityrangedfrom overnightto365days(2002:from182 The depositsareplacedmainlywithanumberofcreditworthyfinancial institutions.Thereisnomajorconcentrationofdeposit principal andinterestrepaymentsundertermsofborrowingsCelcom asmentionedinnote13(b)tothefinancialstatements. acquiredduringtheyear.a whollyownedsubsidiary Depositsofthe GroupalsoincludedRM191.2millionbeingfundsearmarkedf Included indepositsoftheGroupisRM60.7millionwhicharepledged assecurityforbankingfacilitiesgrantedtoassociates – RinggitMalaysia 3,346.1 The currencyexposureprofileofcashandbankbalances 3,279.3 TOTAL CASHANDEQUIVALENTS AT ENDOFTHEYEAR TOTAL CASHANDBANKBALANCES T – Othercurrencies – USDollar Less: Cash andbankbalancesunderIslamicprinciples Cash andbankbalances Deposits with: Deposits underIslamicprinciples otal Deposits is asfollows: Deposits pledged Bank overdraft(note13(e)tothefinancialstatements) Licensed banks Other financialinstitutions Licensed financecompanies 31 DECEMBER 2003 3,346.1 2,451.7 2,812.1 1,161.6 1,047.6 807.0 122.0 412.0 600.5 (60.7) 2003 87.4 (6.1) RM 2.4 H RU THECOMPANY THE GROUP 1,834.8 1,512.7 1,821.0 1,834.8 975.6 770.8 241.9 345.3 740.0 424.4 (13.8) 2002 88.4 80.2 RM 3.0 — 852.0 249.8 818.2 602.2 852.0 852.0 679.2 139.0 2003 33.8 RM — — — — — — of Celcom, 1,138.2 1,036.2 1,138.2 1,138.2 466.8 671.4 102.0 740.0 208.2 2002 85.0 RM 3.0 — — — — or s ) 9 CASHFLOWS FROMOPERATING ACTIVITIES 29. TRADEANDOTHER PAYABLES 28. OA RD N TE AALS4,522.0 – BangladeshTaka – GoldFrancCurrency – SpecialDrawingRights – USDollar – RinggitMalaysia The currencyexposureprofileoftradeandotherpayables TOTAL TRADEANDOTHERPAYABLES OA AHFOSFO PRTN CIIIS4,662.8 TOTAL CASHFLOWSFROMOPERATING ACTIVITIES Otherpayablestosubsidiaries andassociatesareunsecured,interestfreehavenofixedtermsofrepayment. (a) from30to90daysinyear2003and2002dependingonthetermsofcontracts. Credit termsoftradeandotherpayablesvary – Othercurrencies Payments tosuppliersandemployees Receipts fromcustomers Deferred revenue Accruals forUSP T Payment ofincometaxes Payment offinancecost Customer deposits Other payablestosubsidiaries(sub-notea) Deposits andtrustmonies Duties andothertaxespayable Finance costpayable Other payablestoassociates(sub-notea) Other payables rade payables is asfollows: 11,289.7 (5,707.1) 4,522.0 3,768.1 2,795.1 (344.2) (575.6) 120.1 300.2 175.3 205.7 280.5 156.7 129.0 132.5 747.3 2003 2003 85.6 72.7 61.7 13.5 RM RM — H RU THECOMPANY THE GROUP H RU THECOMPANY THE GROUP (4,861.3) 3,675.7 3,248.1 3,675.7 3,223.4 9,402.2 2,369.4 (868.2) (449.3) 220.7 132.5 230.5 113.8 124.9 661.1 2002 2002 53.4 13.4 79.0 97.0 RM RM 7.6 — — — (3,686.5) 2,863.1 2,390.6 2,863.1 2,937.8 7,424.9 1,906.4 (316.6) (484.0) 120.1 233.7 213.2 103.4 486.8 2003 2003 72.7 46.0 33.0 70.4 49.9 RM RM — — — — (3,769.6) 2,576.5 2,362.5 2,576.5 2,584.6 7,634.7 1,597.3 (835.2) (445.3) 158.9 209.2 119.7 504.1 2002 2002 13.4 34.1 87.3 58.9 RM RM 7.6 — — — — —

219 220 1 CASHFLOWS FROMFINANCING ACTIVITIES 31. CASHFLOWS USEDININVESTINGACTIVITIES 30. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS OA AHFOSFO IACN CIIIS2,427.3 TOTAL CASHFLOWSFROMFINANCING ACTIVITIES (5,618.4) TOTAL CASHFLOWSUSEDININVESTINGACTIVITIES Issue ofsharecapitaltominorityinterests Issue ofsharecapital Purchase ofproperty, plantandequipment Disposal ofproperty, plantandequipment Acquisition of a subsidiary (note2tothefinancialstatements) Acquisition ofasubsidiary Purchase of shortterminvestments Disposal ofshortterminvestments Purchase of longterminvestments Disposal oflongterminvestments Acquisition ofintangibleasset(3GSpectrum) Advances to a subsidiary foracquisitionofanothersubsidiary Advances toasubsidiary Repayments ofborrowings Proceeds fromborrowings Dividends paidtoshareholders Dividends paidtominorityinterests Additional investmentinsubsidiaries Acquisition ofanassociate Additional investmentinanassociate Repayments fromsubsidiaries Advances toothersubsidiaries Dividend received Interest received Loans toemployees Repayments ofloansbyemployees (note 2tothefinancialstatements) 31 DECEMBER 2003 (2,566.2) (2,963.5) (6,766.5) 8,836.9 (254.4) (228.4) 593.6 123.8 (66.7) (10.0) (97.3) 2003 2003 12.1 57.3 18.4 40.6 87.5 (8.3) RM RM — — — — — — — H RU THECOMPANY THE GROUP H RU THECOMPANY THE GROUP (4,725.6) (3,164.2) (1,037.7) (1,653.7) 1,631.2 (341.6) (115.2) 809.8 535.0 (30.8) 2002 2002 24.9 27.3 24.5 87.7 99.7 (3.4) (4.4) (0.7) RM RM 5.6 — — — — — — — (5,639.4) (1,764.9) (6,333.9) (3,793.2) 2,415.4 8,384.1 (250.0) (228.4) 593.6 113.3 123.8 (66.7) (10.0) (96.0) (96.8) 2003 2003 57.3 18.4 73.4 44.9 (0.1) RM RM 7.2 — — — — — (4,095.2) (2,114.9) (1,653.7) 1,090.0 (745.1) (341.6) (294.0) (114.4) 538.3 535.0 (30.8) (11.0) (46.1) (83.0) 2002 2002 22.7 24.5 31.7 75.7 98.8 (0.7) RM RM — — — — — — 4 COMMITMENTS 34. RELATED PARTIES TRANSACTIONS 33. SIGNIFICANTNON-CASHTRANSACTIONS 32. g Transfer toalocalinvestmentholdingsubsidiary ofinvestmentinanoverseassubsidiary (g) million) ofwhichRM0.2millionremainedoutstandingasat31December2003. deemed interestedinthetransaction.ProgressbillingsfromESSBduringyearamountedtoRM0.9million(2002:RM0.2 approximately RM1.6millon.Y.B. Dato’JosephSalangGandum,who is adirectoroftheCompanyandshareholderESSB rehabilitation andslopestabilisationworksatTMBukitDabeiMicrowaveStation,MarudiSarawakacontractvalueof toEdward&SonsSdn.Bhd.(ESSB)onthetenderforroad On 1August2002,aletterofawardwasissuedbysubsidiary transaction andbalance. In additiontorelatedpartydisclosuresmentionedelsewhereinthefinancialstatements,setoutbelowisother Significant non-cashtransactionsduringtheyearareasfollows: a Property, plantandequipment (a) f Transfer ofproperty, plantandequipmentcapitalwork-in-progress (f) b Contrasettlementswithsubsidiariesbetweentradereceivablesandpayables (b) Transfer ofinvestmentinCelcomtoalocalholdingsubsidiary (a) e Capitalisationofadvances,loansandtradedebtsintopaid-upcapitalsubsidiaries (e) betweentradereceivablesandotherpayables Contrasettlementswithasubsidiary (d) intoshareholderadvances Conversionoftradereceivablesfromasubsidiary (c) Commitments inrespectofexpenditureapproved Commitments inrespectofexpenditureapproved to whollyownedsubsidiariesatconsiderationssatisfiedbytheissuanceofshares but notcontractedfor and contractedfor 2,544.0 126.2 2003 RM H RU THECOMPANY THE GROUP 3,065.3 2002 24.4 RM 1,768.2 2,259.3 177.6 120.0 2003 2003 86.2 RM RM — — — — THE COMPANY 2,826.5 837.0 633.0 2002 2002 72.4 76.8 RM RM — — — —

221 222 5 CONTINGENTLIABILITIES(Unsecured) 35. COMMITMENTS (continued) 34. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS a At31December2003,theCompanyhadcontingentliabilitiesinrespectof: (a) Non-cancellableoperatingleasecommitments (b) Later thanfiveyears Later thanoneyearandnotlaterfiveyears (iv) A A (iv) NotestotallingapproximatelyUSD6.7million (RM25.4million)(2002:USD6.7 GuaranteeofaseriesPromissory (iii) A (ii) GuaranteesissuedtobanksamountingUSD26.0million(RM98.8million)(2002:million)) (i) subsidiary. The aboveleasepaymentsrelatetothenon-cancellableoperatingofatelecommunicationtowerfromwhollyowned Not laterthanoneyear in November2003andwillexpire2005. financing facilityobtainedbyawhollyownedsubsidiary, MTNNetworks(Pvt.)Limited.Theguaranteewasexecuted Notesarepayableduring theperiodbetweenNovember2003toDecember2005. The Promissory million (RM25.4million))issuedbySotelguiS.A.,asubsidiary, infavourofanequipmentsupplieron18April2002. (Pvt.) Limited.Theguaranteewasexecutedon6May2002andwill expireinMarch 2010. (2002: USD21.0million(RM79.8million))financingfacilityobtainedbyawhollyownedsubsidiary, MTNNetworks for bankingfacilitiesextendedtooverseassubsidiaries. corporate guaranteewasgrantedtoafinancialinstitutioninrespect oftheUSD25.0million(RM95.0million) corporate guaranteewasgrantedtoafinancialinstitutioninrespectoftheUSD21.0million(RM79.8million) 31 DECEMBER 2003 payments minimum Future 367.0 262.2 lease 2003 52.4 52.4 RM THE COMPANY payments minimum Future 121.8 401.3 226.3 2002 lease 53.2 RM 5 CONTINGENTLIABILITIES(Unsecured)(continued) 35. e On10March awritofsummonsonCelcom(Malaysia)Berhad 2000,CelcomTimur (Sarawak)Sdn.Bhd.(CTS) served (e) InmissCommunicationsSdn. Bhd.(Inmiss)hasfiledaNoticeforArbitrationagainstMobikomSdn.(Mobikom) (d) On11August2003,TMandTelekom PublicationsSdn.Bhd.(TPSB)institutedlegalproceedingsagainstBuyingGuide (c) 1998madebetweenTelekom Thereisaclaimarisingfromanagreementdated10February Malaysia(TM)andTan Sri (b) crystallisation oftheadditionalclaimisremote. crystallisation No provisionhasbeenmadefor the disputedclaimasdirectorsofCelcomareopinion thatthelikelihoodof at thisjuncturependinghearingonadatetobefixedbytheCourt. Judgementappeal.Theoutcome ofthelegalactionandhenceanyamountpayabletoCTScannotbeascertained Summary The trialofthedisputedbalanceclaimamountingtoRM12.0 millionwillonlybeheardafterthehearingofabove Judgementandthedatefor the appealhasyettobesetbyCourtofAppeal. Summary 2001infavourofCTSforRM90.6million.Celcomisappealing againstthis by theKuchingHighCourton23February entered defenceagainstthesuit,andappliedtostrikeoutsuitfor wantofauthority. Judgementwaspassed ASummary the amountclaimedonbasisthatCTSusedanincorrectmethod ofcalculationtodeterminetheamountowing.Celcom (Celcom), inrespectoftheleasefibreopticlinksforRM102.6 million withinterestaccruingthereon.Celcomdisputed scheduled on3March 2004forfinalsubmissionbyMobikom. The arbitrationhearingisheldattheKualaLumpurRegionalCenterforArbitration.nextdatehasbeen of RM29.0million. outstanding paymentonInmiss’s shareofmessagetariffrevenueincludinginterestchargesandotherlossesintheamount and DefenceafterBGSBtheirshareholdersconfirmthattheywillnotbeamendingCounterclaim. BGSB havefiledtheirDefenceandCounterclaim on15October2003anditwasagreedthatTMTPSBwillfileaReply Bhd. (BGSB)relatingtotheinfringementofTM’s andTPSB’s copyrightandpassingoff. On 10November2003,theHighCourtfixed11March 2004asthenewmentiondateforOMandOS. an OriginatingSummons(OS). by wayofanOriginatingMotion(OM).Simultaneously, MEPSJVfiledanapplicationtoenforce thesaidAward bywayof Pursuant tothecompensationawardedbyJKR(theAward), TMfiledanappealforreviewoftheAward intheHighCourt JKR hasawardedacompensationofRM63.8millioninfavourMEPSJV. payment oftheretentionmoney. ThisdisputehasbeenreferredtoJabatanKerjaRaya(JKR)ofwhich,on27June2002, guarantee,thedeductionofliquidateddamagesfordelayandcertification retention ofthecashperformance The disputesbetweentheparties,amongstothersincludecompletionofoutstandingworks,remedyingdefects, Multimedia UniversityCampusatCyberjaya,SelangorDarulEhsan. Bhd. (collectivelyreferredtohereinasMEPSJV),JVagreeddesign,constructandcompletetheproposed Mustapha KamalHajiAbuBakar, EastborneCorporationBerhad,ProjassEngineeringBerhadandShorefieldHoldingsSdn.

223 224 5 CONTINGENTLIABILITIES(Unsecured)(continued) 35. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS i ByaJVA dated13September1993,TRIandVIPEngineering andMarketingLimited(VIPEM)agreedtoestablishTRI (i) (h) (g) CelcomfiledapetitionagainstSarawakElectricitySupplyCorporation(Sesco)(andotherpersonsconnectedwithSesco) (f) to theTanzania HighCourtfortheappointmentofreceiver/manager totakeconductovertherunningofTritel. TRI filedpetitiontostaytheproceedings. Thepetitionhasyettobeheard.Pendingdeterminationofthe Suit,VIPEMapplied the arbitrationclauseinJVA andappliedforastayofproceedings.TheCourt declinedtogranttheex-parteorderand basis. Tritel andTRI’s lawyersassertedthattheCourthasnojurisdiction toentertaintheChamberApplicationbecauseof million asitsshareoflossprofits formismanagementofTritel. VIPEMaskedforanordertobemadeonex-parte On 10December2001,videCivilCaseNo.427of2001(theSuit)VIPEM filedasuitagainstTRIclaimingsumofUSD18.6 T Te to reachanamicablesettlementonthisissuewhichisnotexpected tohaveamaterialimpactonthefinancialstatements. from Technology Resources Industries Berhad(TRI)withregardtoaprojectaccount.CelcomgroupisindiscussionMAS By aletterdated16August2002,MalaysianAirlinesSystemBerhad (MAS)haddemandedatotalsumofRM16.4million its investmentinCTS. reached andthatthevaluetoberealisedundersettlementwillatleastequalCelcomgroup’s valueof carrying with themattersdiscussedin(e)and(f)above.ThedirectorsofCelcomareoptimisticthatsuchasettlementcanbe The partiesarecurrentlyindiscussionswitheachothertowardsaglobalout-of-courtsettlementofthisdisputetogether values theinterestinCTSatbelowCelcom’s valueofitsinvestmentinCTSRM48.4million. carrying shares toSescoatapricebedeterminedbyanindependentauditor. Celcommaysuffer alossintheeventthisprice judgment underOrder14A.IfSescosucceedsinthe14Ahearing,CourtwouldorderCelcomtotransferitsCTS the groundsthattherearenodisputestobereferredarbitration,Sescohasagoodchanceinitsapplicationfor The directorsofCelcom,basedonlegalopinionreceived,aretheviewthatsinceinterimstayhasbeenrefused 3 March 2004. High Court1980(Order14A)andtoenterjudgementonitsclaim.TheOrder14Aapplicationhasbeenfixedformention On 13September2001,Sescofiledanapplicationfor“disposalofcaseonpointlaw”underOrder14AtheRules and dismissedthearbitrationstayappeal.Accordingly, on13August2002,theJudgedismissedappealforinterimstay. together withanapplicationintheHighCourtforinterimstaypendingappeal.On25July2002,ofAppealheard dispute tobereferredarbitrationwasdismissedbytheHighCourtwhereuponCelcomfiledanappealofAppeal purportedly breachedcertainconditionsstipulatedundertheJVA. Celcom’s applicationforstayofproceedingsandthe to seekadeclarationthattheJointVenture Agreement(JVA) dated5May1994shouldbeterminatedasCelcomhad On 3August2001,Sesco,jointventurepartnerofCelcominCTS,filedattheKuchingHighCourtbywayWritSummons received areoftheviewthatCelcomhasareasonablechancesucceedinginthismatter. out Celcom’s petitionhasbeenfixedforhearingon22March 2004.ThedirectorsofCelcom,basedonlegalopinion Judgementreferredtoin(e)above.Sesco’sthe eventCelcomfailedtomakepaymentofSummary applicationtostrike injunction application.On1August2001,CTSgaveanoticetoCelcomofitsintentionsellCelcom’s sharesinCTS injunction restrainingCTSfromfilingorproceedingswiththewindinguppetitionpendingdisposalofinterparties from proceedingwithawindinguppetitionagainstCelcom.On14June2001,Celcomsuccessfullyobtainedaninterim under Section181oftheCompaniesAct,1965andon25May2001,alsosoughtaninteriminjunctiontorestrainCTS anzania. Theshareholdingstructurewas60%TRIand40%VIPEM. lecommunications Tanzania Limited(Tritel) asajointventurecompany, in toprovidetelecommunicationsservices 31 DECEMBER 2003 5 CONTINGENTLIABILITIES(Unsecured)(continued) 35. (j) TRI and Integrated Services Limited(ISL)enteredintoaJVA TRIandIntegratedServices 1995 ontheestablishmentofShebaTelecom dated21January (j) (i) to seekdeclarationsrefutingcertainallegationsmadebyISLinthe Suit. of theSuitandformattertobereferredarbitrationproceedings. TRIthencommencedthearbitrationinSingapore share ofequityto86.4%wasinvalid.On19November2001,TRI successfullyobtainedanorderstayingtheproceedings the directors(theSuit).OneofallegationsmadebyISLinthis claimwasthattheresolutionpassedtoincreaseTRI’s Sheba andtheRegistrarofJointStockCompaniesfor, interalia,allegedmisconductand mismanagementonthepartof In oraboutApril2000,ISLcommencedasuitintheSupremeCourtofBangladeshagainstSheba,TRI,directors by wayofcapitalisationadvancesmadeTRItoSheba,therebyincreasingTRI’s shareoftheequityto86.4%. respectively. On18March 1999,Sheba’s boardofdirectorsresolvedtoincreasetheissuedandpaid-upcapitalSheba respectively. On10June1997,thepartiesagreedtoamendequityholdingofTRIandISLinSheba51%49% (Pvt.) Ltd.(Sheba)asthejointventurecompanyinBangladesh.ISLandTRIinitiallyheld51%49%ofSheba’s equity statements fortheclaimmadebyVIPEM. there isalsoapossibilitythatVIPEMwillnotpursueitsclaim.Hence,noprovisionhasbeenmadeinthefinancial more evidencecanbeproduced,theallegationsarerhetoricalandunsubstantiated.Inviewofwindingupproceedings, The directorsofCelcom,basedonlegalopinionreceived,aretheviewthatallegationsmismanagement,unless liquidator ofTritel. In thelightofwindingupordermadeagainstTritel, on22July2003TRIfileditsclaimofRM123.4milliontothe concerning Citibank’s applicationisongoing. As theresultofCourtruling,Citibankhadindependentlyfiledanapplicationtochallengeruling.Legalproceeding liquidator, theCourthadon17July2003adjournedsinedieSuit. handover statementsandaccountsofTritel’s affairstothenewlyappointedliquidator. Inthelightofappointment Consequently, theCourtalsoheldjointreceiversandmanagers,who wereappointedbyCitibank,orderedto affidavit insupportofthesaidpetition.Asaresultthereof,HighCourthasadmittedVIPEMasjointcreditorTritel TCC, Tanzania Telecommunications CompanyLimitedandTanzania RevenueAuthoritytowindupTritel. VIPEMhadfiledan Subsequently, on12June2003,theHighCourtofTanzania hadendorsedapetitionbythreecreditorsofTritel, namely T T anzania (Citibank)appointedreceiversandmanagersbyvirtueofadebentureissuedTritel asaloansecuritytoCitibank. anzania CommunicationsCommission(TCC)revokedTritel’s 2003,Citibankof 2003.On14January licenseasof31January .

225 226 5 CONTINGENTLIABILITIES(Unsecured)(continued) 35. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS k On10March 2003,CelcomreceivedaletterfromDeTeAsia HoldingGmbH(DTAH) informingCelcomthatithadinitiated (k) ISLalsomadeacounterclaim inthearbitration,alleging,interalia,breachesoftermsJVA andotheralleged (j) such damages. to DTAH willhavetobeassessed.Itwouldnotpossible,atthisstage, determinewithanycertaintythequantumof arbitration arereasonable.Intheeventthatarbitraltribunalfinds infavourofDTAH, thedamagespayablebyCelcom The directorsofCelcom,basedonlegalopinionreceived,arethe viewthattheprospectsofsuccessfullydefending the hearingdatehasbeenfixedfrom12July2004to23 forthehearingofarbitration. ofCasefiledbyDTAHSummary withtheICCon1August2003.Athree-memberarbitraltribunalhasbeenconstituted and Subsequent tothefilingofRequest,DTAH hasalsoraisedfurtherallegationsofbreachesagainstCelcominthe on whichDTAH reliesonareeithernotenforceable orthatDTAH isprecludedfromassertingthevalidityofsame. DTAH wasnotrequiredfortheacquisitionofTMCellularandthatsuchprovisions intheAmendedandRestatedAgreement at eightpercent (8%)perannumfrom16October2002andcosts.Celcom’s contention isessentiallythattheconsentof be calculatedbyreferencetotheprovisionsofSchedule1AmendedandRestatedAgreement,togetherwithinterest of DTAH, CelcomhasactedinbreachoftheAmendedandRestatedAgreement.DTAH isseekingdamagesinanamountto and paid-upcapitalofTMCellularSdn.Bhd.(TMCellular)thesubsequentacquisitionwithoutconsent entering intotheSaleandPurchase AgreementwithTelekom MalaysiaBerhadfortheacquisitionofwholeissued DTAH isessentiallyclaimingdamagesforbreachoftheAmendedandRestatedAgreement.DTAH’s contentionisthatby TR InternationalLimited(TRIL)(theAmendedandRestatedAgreement). to Clause8.6oftheAmendedandRestatedSupplementalAgreementdated4April2002betweenTRI,DTAH, Celcomand the SecretariatofInternationalCourtArbitrationChamberCommerce inParis(ICC)pursuant an arbitrationbywayofaRequestforArbitrationdated7March 2003(Request)whichwasfiledon10March 2003with outcome tothearbitration. investment inandadvancestoShebawerealsonotadjustedreflectthepotentialexposureeventofanunfavourable favour. valueofCelcomgroup’s Assuch,noallowancehasbeenmadefortheamountsclaimedbyISL.Thecarrying The directorsofCelcom,basedonlegalopinionreceived,aretheviewthatarbitrationislikelytobedecidedinTRI’s fixed from12May2004until282004. 2004.Continuedhearinghasbeen 2004to30January The arbitrationhearingproceededasscheduledfrom19January asumofUSD2.6millionwhichTRIallegedlyagreedtopayISLasmarketingconsultingfee. (iii) asumofUSD36.2millionbeingtheallegednetlossopportunitytoenterintoandimplement anotheragreement (ii) asumofUSD179.3millionbeingallegednetlosspotentialearningsSheba; (i) irregularities inthemanagementandoperationsofShebaisseeking,interalia,anorderthatTRIpaystoISL: with theBangladeshTelegraph andTelephone Board;and 31 DECEMBER 2003 6 SIGNIFICANTEVENTS 36. CONTINGENTLIABILITIES(Unsecured)(continued) 35. c G-ComfiledaWrit of SummonsandaStatementClaimattheHighCourtGhanaagainstGTon24December2003 (c) ofTM,filedanapplication intheHighCourtofGhanaon13June2002,seekinga G-ComLimited(G-Com),asubsidiary (b) On18September2002,Telekom Malaysia(TM)issuedaNotificationofClaimtotheGovernmentGhana(GoG)pursuant (a) the businessofGroupandCompanyonthesenomateriallossesareanticipated. cours There werenoothercontingentliabilitiesormateriallitigationsguaranteesthanthosearisingintheordinary its subsidiaries. or ofanyfactslikelytogiveriseproceedingswhichmightmateriallyaffectthepositionbusinessCompanyan Apart fromtheabove,DirectorsarenotawareofanyotherproceedingspendingagainstCompanyand/oritssubsidiaries February 2004. February in respectoftheEGMandAGMresolutionstoapprovecertaincontracts andloans.Thehearingdateisexpectedtobein approximately befixedinthefirstquarterof2004. Judge hasprovidedhiswrittenJudgmentandTMbeenadvised thattheearliesthearingdateofsaidappealwill dated 31July2002.TheCourtofAppealhasyettofixthehearing dateofthesaidappeal.Meanwhile,HighCourt On 25September2002,G-ComfiledanappealintheCourtofAppeal ofGhanaagainstthedecisionHighCourt High CourtofGhanadismissedG-Com’s applicationforadeclarationtonullify theEGMheldon3June2002. General Meeting(EGM)heldon3June2002wasnullandvoid.On31July2002,the declaration thattheExtraordinary 2003 atTheHague,itwasagreedthatthearbitrationhearingwillstarton5July2004foraperiodoftwo(2)weeks. provisions ofBIT. meetinginrelationtothearbitrationbetween TMandGoGheldon17July Basedonthepreparatory in accordancewiththeprovisionsofBIT. Subsequently, thearbitraltribunalwasconstitutedinaccordanceto 2003forthecommencementofarbitrationproceedingsunderUNCITRAL ArbitrationRules to theGoGon10February Since thepartiescouldnotreachanamicablesettlement,TMthroughitscounselinLondon,sentaNoticeofArbitration GoG’s failuretorefundaUSD50.0million(RM190.0million)depositfortheproposedacquisitionofadditional15% (ii) (i) of thefollowingdisputes: to theBilateralInternationalTreaty betweentheGovernmentofMalaysiaandGoGon11November1996(BIT)inrespect into betweenTMandGoGdated10August2000. equity interestinGT(asdisclosednote25tothefinancialstatements)pursuantHeadofAgreemententered during year2002. operation policiesdecisionsofGT. Accordingly, theinvestmentinGThasbeenrecordedaslongterm International Sdn.Bhd.andG-ComLimitedwhichresultedinTMlosingsignificantinfluenceoverthefinancial GoG’s pasttreatmentofTM’s investmentinGhanaTelecommunications CompanyLimited(GT)heldthroughTM e of d/or

227 228 7 SEGMENTAL REPORTING 37. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS presentation duetoretrospectiveapplicationofaccountingpolicies asdescribedinnote42tothefinancialstatements. Prior year’s segmentdatapresentedforcomparativepurposeshasbeenadjustedorextendedtoconformwithchangesin exchange differencesarisingfromrevaluationofcorporateborrowings) asshowninnote4tothefinancialstatements. Significant non-cashexpensescomprisemainlyallowancesand unrealisedforeignexchangelosses(excludingnet acquisition ofsubsidiariesasshowninnote18and19tothefinancialstatements. Segment capitalexpenditurecomprisesadditionstointangibles,property, plantandequipment,includingadditionsresultingfr current taxanddeferredliabilities. Segment liabilitiescompriseoperatingandexcludecorporateborrowings,interestpayableon training centre. staff loans,otherlongtermreceivables,investments,deferredtaxassetsandproperty, plantandequipmentoftheCompany’s receivables, property, plantandequipment,inventoriescashbankbalances.Unallocatedcorporateassetsmainlyinclude Segment assetsdisclosedforeachsegmentrepresentdirectlymanagedbysegment,primarilyincludeintangibles, results areconsistentwiththoseasdescribedintheSignificantAccountingPolicies. exchange differencesarisingfromrevaluationofcorporateborrowings.Theaccountingpoliciesusedtoderivereportablesegmen dividend incomeandgainorlossondisposalofinvestments.Unallocatedcostsrepresentcorporateexpensesnetforeign Segment resultsrepresentsegmentoperatingrevenuelessexpenses.Unallocatedincomeincludesinterestincome, Non-telecommunicationrelatedservices (c) Cellular (b) Fixedline (a) The Groupisorganisedonaworldwidebasisinthreemainbusinesssegments: By Business – providedbysubsidiarieswithcorebusinessinconsultancy,represents services propertymanagement,educationand – representsmobiletelecommunicationservices – representsfixedline,data,internetandmultimediaothertelecommunicationrelatedservices other activities,noneofwhichareasufficientsizetobereportedseparately 31 DECEMBER 2003 om t 7 SEGMENTAL REPORTING (continued) 37. Inter-segment* T Operating Revenue Y Share ofprofitslesslossesassociates Finance income Finance cost Operating profitbeforefinancecost Foreign exchangelosses Corporate expenses Unallocated income Segment result Results External operatingrevenue Unallocated liabilities Segment liabilities Unallocated corporateassets Associates Segment assets Net Assets At 31December2003 Profit fortheyearattributabletoshareholders Minority interests Profit aftertaxation T Profit beforetaxation otal operatingrevenue axation ear Ended31December2003 T T otal liabilities otal assets n utmdaClua tesTotal Others Cellular and multimedia data, internet Fixed line, 94311,5. ,7. 32,795.9 1,272.2 12,050.6 19,473.1 ,4. ,7. 7. 12,693.2 473.0 3,875.4 8,344.8 ,8. 5. 662,128.4 86.6 11,796.4 453.2 250.3 1,588.6 3,606.3 7,939.8 ,5. ,0. 1. 7,771.8 114.1 1,499.6 4,200.4 — 3,457.3 287.8 1,211.8 450 291 227 (896.8) (222.7) (269.1) (405.0) 3. 3. 375.2 — 139.0 236.2 MR MRM RM RM RM 19,012.8 36,040.3 11,241.0 1,865.3 1,744.8 1,390.4 1,444.2 1,810.5 (366.3) (517.1) (266.6) (82.1) (53.8) 87.1 85.6

229 230 7 SEGMENTAL REPORTING (continued) 37. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS ne-emn*(4.)(57 178 (555.9) (127.8) (85.7) (342.4) Inter-segment* T Operating Revenue Y Significant non-cashexpenses Impairment ofproperty, plantandequipment Write offofproperty, plantandequipment Depreciation rftfrteya trbtbet hrhles844.3 42.5 1,985.8 — 33.4 4.0 100.5 9,834.1 38.5 1,851.9 Profit fortheyearattributableto shareholders 213.7 Minority interests Profit aftertaxation 1,588.9 T Profit beforetaxation 8,031.5 Share ofprofitslesslossesassociates Finance income Finance cost Operating profitbeforefinancecost Foreign exchangelosses Corporate expenses Unallocated income Segment result Results External operatingrevenue – acquisitionofasubsidiary – additionsduringtheyear Capital expenditure Other Information Y tloeaigrvne8339164631510,390.0 341.5 1,674.6 8,373.9 otal operatingrevenue axation ear Ended31December2002 ear Ended31December2003 31 DECEMBER 2003 n utmdaClua tesTotal Others Cellular and multimedia data, internet Fixed line, ,8. 3. 133,551.3 31.3 932.6 2,587.4 ,6. 8. 732,681.5 27.3 684.7 1,969.5 5. 6. . 522.3 2.3 269.0 251.0 MR MRM RM RM RM . 49—99.2 5.8 — — 94.9 0.1 4.3 5.7 — ,9. 5,899.6 — 5,899.6 1,530.4 1,791.8 (389.6) (213.1) (659.7) 870.7 (26.4) (66.3) 85.7 85.4 7 SEGMENTAL REPORTING (continued) 37. soits9571708—2,746.5 — 25,066.9 1,760.8 1,321.8 985.7 3,934.8 19,810.3 Unallocated corporateassets Associates Segment assets Net Assets At 31December2002 mareto odil3. 39.7 2,481.8 600.8 — 51.7 55.7 0.2 50.9 — — 280.7 3,185.1 253.0 — 2,145.4 18.0 39.7 — 347.6 — 1,004.6 In 4,959.2 51.7 more than10%ofconsolidatedoperatingrevenueorassets. 2,162.5 157.7 50.9 contributed operation bygeographicallocationisonlysegmentisedtoMalaysia andoverseasasnoindividualcountry Although theGroupoperatesinmanycountriesasshownnote 43tothefinancialstatements,segmentisationofGroup By GeographicalLocation 1,599.7 * Inter-segment operatingrevenuehasbeeneliminatedinarrivingatrespectivesegment operating revenue.Theinter-segment 3,201.8 Significant non-cashexpenses Impairment ofgoodwill Write offofproperty, plantandequipment Depreciation – acquisitionofasubsidiary – additionsduringtheyear Capital expenditure Other Information Y Unallocated liabilities Segment liabilities There isnosalebetweenthesegments.Total assetsandcapitalexpenditurearedetermined basedonwheretheassetsarelocate ear Ended31December2002

T T operating revenuewasenteredintointhenormalcourseofbusiness and atpricesavailabletothirdpartiesornegotiatedt presenting information for geographical segments of the Group, sales are based on the country inwhichthecustomer islocat presenting informationforgeographicalsegmentsoftheGroup,sales arebasedonthecountry otal liabilities otal assets n utmdaClua tesTotal Others Cellular and multimedia data, internet Fixed line, MR MRM RM RM RM 13,790.1 28,935.4 1,122.0 8,830.9 erms. ed. d.

231 232 8 FINANCIALRISKMANAGEMENTOBJECTIVESANDPOLICIES 38. SEGMENTAL REPORTING (continued) 37. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS Unallocated corporateassets certain longtermforeigncurrency borrowingsfromvariabletofixedrateorviceversa. and desiredinterestrateprofile. To obtainthismix,the Groupusescombinedcross-currencyinterestrateswapstoconvert order toachievethisobjective,the Grouptargetsamixoffixedandfloatingdebtbasedonassessment ofitsexistingexposur is tomanagetheinterestexpense consistentwithmaintaininganacceptablelevelofexposureto interest ratefluctuations.In The Group’s debtincludesbankoverdrafts, bankborrowings,bonds,notesanddebentures.TheGroup’s interestrate riskobjecti maturitiesandinterestrateterms. manages itsinterestraterisksbyplacingsuchbalancesonvarying The Grouphascashandbankbalancesdepositsplacedwithcreditworthy licensedbanksandfinancialinstitutions.TheGroup Interest RateRisk and SouthAfricanRand. denominated inforeigncurrencies.Themaincurrencyexposuresare primarilyGuineaFranc,BangladeshTaka, SriLankaRupee The Groupalsohassubsidiariesandassociatesoperatinginforeign countries,whichgeneraterevenueandincurcosts reduce theforeigncurrencyexposuresontheseborrowings.Themain currencyexposuresareprimarilyUSDollarandJapaneseYen currency interestrateandswapsthatareprimarilyusedtohedgeselectedlongtermforeignborrowings The foreignexchangeriskoftheGrouparisesfromborrowingsdenominatedincurrencies.haslongdated,cros Foreign ExchangeRisk hedge underlyingcommercial exposuresandarenotheldorsoldforspeculativepurposes. Hedging transactionsaredeterminedinthelightofcommercial commitments.Derivativefinancialinstrumentsareusedonlyto The Grouphasestablishedriskmanagementpolicies,guidelinesandcontrolprocedurestomanageitsexposurefinancialrisks the Group. The Group’s of overallriskmanagementseekstominimisepotentialadverseeffectsoftheserisksonthefinancialperformance The mainrisksarisingfromtheGroup’s financialassetsandliabilitiesareforeignexchange,interestrate,creditliquid T Associates Malaysia Overseas otal assets 31 DECEMBER 2003 11,796.4 10,996.9 PRTN EEU OA SESCAPITAL EXPENDITURE TOTAL ASSETS OPERATING REVENUE 799.5 2003 RM 9,834.1 9,292.8 541.3 2002 RM 32,795.9 36,040.3 31,035.7 1,744.8 1,499.6 1,760.2 2003 RM 25,066.9 28,935.4 23,592.2 1,122.0 2,746.5 1,474.7 2002 RM 8,581.1 8,173.2 407.9 2003 RM 3,236.8 2,948.9 ity risks. 287.9 2002 RM ve to s- e . . Cash andBankBalances Short Term Investments T Staff LoansandOther Investments Financial Assets 2003 rade andOtherReceivables (excluding shorttermstaffloans) Long Term Receivables 9 INTERESTRATE RISK 39. FINANCIALRISKMANAGEMENTOBJECTIVESANDPOLICIES(continued) 38. uncommitted creditlinesavailable. dynamic natureoftheunderlyingbusiness,Groupaimsatmaintainingflexibilityinfundingbykeepingbothcommittedand adequate bythemanagementtofinanceGroup’s operationsandmitigatetheeffectsoffluctuationsincashflows.Dueto In themanagementofliquidityandcashflowrisk,Groupmonitorsmaintainsalevelequivalentsdeemed Liquidity Risk derivative instruments,butdoesnotexpectanycounterpartiestofailmeettheirobligations. Group. TheGroup,however, bycounterpartiestofinancial isexposedtocredit-relatedlossesintheeventofnon-performance All hedginginstrumentsareexecutedwithcreditworthyfinancialinstitutionsaviewtolimitthecreditriskexposureof The Group’s policylimitstheconcentrationoffinancialexposuretoanysingleinstitution. The Groupplacesitscashandequivalentsmarketablesecuritieswithanumberofcreditworthyfinancialinstitutions. procedures. Whereappropriate,theGroupobtaineddepositsorbankguaranteesfromcustomers. customer base.Creditriskismanagedthroughtheapplicationofcreditassessmentandapprovals,limitsmonitoring other majorsignificantconcentrationofcreditriskthanbusinessandresidentialtradereceivablesduetoitsdiverse Due tothenatureofGroup’s business,customersaremainlysegregatedintobusinessandresidential.TheGrouphasno bank balances,marketablesecuritiesandfinancialinstrumentsusedinhedgingactivities. Financial assetsthatpotentiallysubjecttheGrouptoconcentrationsofcreditriskconsistprimarilytradereceivables,cash Credit Risk T THE GROUP Sensitivity tointerestratesarisesfrommismatchesintherepricingdates,cashflowsandothercharacteristicsofassets maturity dates.Theoff-balance-sheetgaprepresentsthenetnotionalamountsofallinterestratesensitivederivativeinstrum and theCompany’s amounts,categorisedbytheearlierofrepricingorcontractual financialassetsandliabilitiesatcarrying The tablebelowsummarisestheGroupandCompany’s exposuretointerestraterisk.IncludedinthetablesareGroup corresponding liabilityfunding. tl3. ,7. 662322573472811808,498.1 1,198.0 4,732.8 2,567.3 233.2 26.6 2,276.9 30.6 otal W ARF*rt esyas5yassniiesniiepicpe Total principles sensitive sensitive 5years years less rate .A.R.F.* .5 37———2. ,1. 3,734.7 3,346.1 — 722.5 350.1 3,711.0 23.7 2,273.5 — — — — 2,273.5 — — 23.7 2.38% 1.45% .0 . 492322153. 7. 769.2 475.5 32.2 261.5 233.2 24.9 3.4 — 4.00% .0 . . . 7. 384.7 — 376.1 8.6 — 1.7 — 6.9 2.00% — laigmtrn rrpie nTtlNn under Non- Total maturingorrepricedin Floating neet1ya r1t oeta neetitrs Islamic interest interest Morethan 1to5 1yearor interest MR MR MR MRM RM RM RM RM RM RM RM —————263.4—263.4 ie neetrt Balances Fixed interestrate

ents. their and the

233 T Customers’ Deposits T Financial Liabilities 2003 rade andOtherPayables 234 otal Borrowings 9 INTERESTRATE RISK(continued) 39. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS Off-balance-sheet interestsensitivitygap ovril od .0 ,6. ,6. 1,361.6 — — 1,361.6 — (2,155.5) 1,361.6 (2,304.8) — 470.4 (1,508.0) * W.A.R.F. –Weighted Average Rateof Financeasat31December — — T 4.00% Off-balance-sheet interestsensitivitygap On-balance-sheet interestsensitivitygap T Customers’ Deposits T — Convertible Bonds Financial Liabilities T Investments Financial Assets 2002 T On-balance-sheet interestsensitivitygap T THE GROUP hr emIvsmns— Short Term Investments T T Staff LoansandOther ahadBn aacs23%—1128——11281745461,834.8 504.6 197.4 1,132.8 — — 1,132.8 — 2.32% Cash andBankBalances tlBroig .4 ,2. 6. 6. ,5. ,1. . 9. 6,314.9 696.3 (2,155.5) (2,304.8) 5.8 470.4 5,612.8 (1,508.0) 2,459.3 964.4 669.1 1,520.0 otal interestsensitivitygap 5.14% 16,857.3 1,991.2 otal 5,155.0 9,711.1 otal Borrowings 4,874.5 919.3 otal 537.6 3,379.7 otal interestsensitivitygap otal aeadOhrPybe — rade andOtherPayables rade andOtherReceivables ecuigsottr tf on)17%1. 203411—3,493.1 — 3,481.1 12.0 — — — 12.0 1.73% (excluding shorttermstaffloans) ogTr eevbe .0 . 123383172. 3. 784.7 431.7 21.3 331.7 303.8 21.2 6.7 — 4.00% Long Term Receivables 31 DECEMBER W ARF*rt esyas5yassniiesniiepicpe Total principles sensitive sensitive 5years years less rate .A.R.F.* .3 ,7. 3. 1. ,7. ,1. . ,9. 11,708.4 1,991.2 6.1 9,711.1 4,874.5 919.3 537.6 3,379.7 5.03% 2003 — — laigmtrn rrpie nTtlNn under Non- Total maturingorrepricedin Floating neet1ya r1t oeta neetitrs Islamic interest interest Morethan 1to5 1yearor interest MR MR MR MRM RM RM RM RM RM RM RM ————— —————626.9—626.9 3391 ,3. 827 (4,641.3) (892.7) 1,739.3 (3,349.1) 3391 ,3. 827 (4,641.3) (892.7) 1,739.3 (3,349.1) ,2. 6. ,2. ,5. ,7. ,0. 9. 11,977.7 696.3 4,307.0 6,974.4 2,459.3 2,326.0 669.1 1,520.0 2011952. 0. ,7. ,3. 3. 6,449.9 936.3 4,037.1 1,476.5 303.8 21.2 1,139.5 12.0 ie neetrt Balances Fixed interestrate ———— ———— ————— ————— ————— ————— ,2. 4,522.0 — 4,522.0 ,7. 3,675.7 — 3,675.7 2. 625.5 — 625.5 139.6 — 139.6 9. 197.7 — 197.7 Cash andBankBalances Short Term Investments T Staff LoansandOther Investments Amount OwingbySubsidiaries Financial Assets 2003 rade andOtherReceivables (excluding shorttermstaffloans) Long Term Receivables net ofallowances 9 INTERESTRATE RISK(continued) 39. T Customers’ Deposits Payable toasubsidiary H RU S P RM JPY THE COMPANY USD T Convertible Bonds Financial Liabilities Cash andBankBalances T Staff Loans Long Term Investment Financial Assets THE GROUP asset andliability: The tablebelowsummarisestheweightedaveragerateoffinanceasat31Decemberbymajorcurrenciesforeachclassfinanci T Off-balance-sheet interestsensitivitygap On-balance-sheet interestsensitivitygap T T Financial Liabilities T rade andOtherPayables otal Borrowings rade andOtherReceivables tl25082481852848734344169012,896.5 689.0 3,484.1 8,723.4 5,298.4 15,488.8 871.8 614.5 2.4 12,436.4 2,437.9 2,550.8 233.2 32.6 682.7 1,489.4 otal interestsensitivitygap otal otal Borrowings otal W ARF*rt esyas5yassniiesniiepicpe Total principles sensitive sensitive 5years years less rate .A.R.F.* .2 7. 7. 37190852.0 139.0 33.7 679.3 — — 679.3 — 1.62% .0 . 492322153. 7. 768.7 475.5 10,265.1 31.7 — 261.5 8,768.0 233.2 1,497.1 24.9 — 3.4 7.7 — — 4.00% 1,489.4 1.83% — — — laigmtrn rrpie nTtlNn under Non- Total maturingorrepricedin Floating neet1ya r1t oeta neetitrs Islamic interest interest Morethan 1to5 1yearor interest .1 ,8. ,8. 2,983.5 — 6,435.0 — 689.0 2,983.5 6.1 2,983.5 — 5,739.9 2,314.9 — 871.8 2.4 — 2,550.8 5.91% 4.91% MR MR MR MRM RM RM RM RM RM RM RM —————260.3—260.3 ————— —————338.1—338.1 — — 1014 8. 892 (5,065.2) (839.2) 680.3 (1,061.4) 1014 8. 892 (5,065.2) (839.2) 680.3 (1,061.4) .5 .7 5.80% 1.87% — 5.45% — 1.45% .6 2.66% — — — 1.26% 0.89% ie neetrt Balances Fixed interestrate ——— —— ————— —————614.9—614.9 ———— 2003 4.00% .4 .9 4.08% 2.09% — 6.24% — 1.73% .0 — — 2.92% — 4.00% 1.44% S P RM JPY USD ——4. ——— 2002 ,0. 3,004.6 — 3,004.6 00% ,6. 2,863.1 — 2,863.1 al

235 hr emIvsmns— — Short Term Investments Investments Amount OwingbySubsidiaries Financial Assets 2002 ahadBn aacs19%—880——8801202821,138.2 208.2 102.0 828.0 — — 828.0 — 1.94% Cash andBankBalances T Staff LoansandOther

236 rade andOtherReceivables e falwne .8 ,9. . ,0. ,3. 4,639.9 — 3,138.1 1,501.8 — 7.7 — 1,494.1 1.88% net ofallowances ogTr eevbe .0 . 123383172. 3. 783.9 431.7 20.5 331.7 303.8 21.2 6.7 — 4.00% — (excluding shorttermstaffloans) Long Term Receivables 9 INTERESTRATE RISK(continued) 39. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS ovril od .0 ,6. ,6. 1,361.6 — — 1,361.6 — (2,584.2) (2,193.3) 1,361.6 674.7 — 180.1 * W.A.R.F. –Weighted Average RateofFinanceasat31December — — T 4.00% Off-balance-sheet interestsensitivitygap On-balance-sheet interestsensitivitygap T Customers’ Deposits T Convertible Bonds Financial Liabilities T THE COMPANY T tlBroig .4 ,1. 6. 6. ,8. ,2. . 8. 5,917.4 (2,584.2) 689.0 (2,193.3) 5.8 674.7 180.1 5,222.6 2,888.0 860.6 160.0 1,314.0 otal interestsensitivitygap 5.94% otal otal Borrowings otal aeadOhrPybe — rade andOtherPayables 31 DECEMBER W ARF*rt esyas5yassniiesniiepicpe Total principles sensitive sensitive 5years years less rate .A.R.F.* 2003 laigmtrn rrpie nTtlNn under Non- Total maturingorrepricedin Floating neet1ya r1t oeta neetitrs Islamic interest interest Morethan 1to5 1yearor interest MR MR MR MRM RM RM RM RM RM RM RM ————— ————— ————— ,1. 6. ,2. ,8. ,8. ,9. 8. 10,469.9 689.0 3,196.7 6,584.2 9,701.3 2,888.0 639.9 2,222.2 6,399.9 160.0 2,661.5 1,314.0 303.8 28.9 834.7 1,494.1 ie neetrt Balances Fixed interestrate ———— ————— ————— ,4. 2,843.3 — 2,843.3 9. 197.7 — 197.7 83—98.3 — 98.3 ,7. 2,576.5 — 2,576.5 1. 614.4 — 614.4 0 CREDITRISK 40. INTERESRATE RISK(continued) 39. fair valuesofthecontracts,indicatingcreditriskexposure. RM is requiredtopaytheGrouporCompanyineventofcontracttermination.Thefollowingtablesummarisesfavourable The GroupandtheCompanyareexposedtocreditriskwherefairvalueofcontractisfavourable,counterparty JPY Off-balance-sheet financialinstruments For on-balance-sheetfinancialinstruments,themaincreditriskexposurehasbeendisclosedelsewhereinstateme USD T Convertible Bonds Financial Liabilities Cash andBankBalances Staff Loans Amount OwingbySubsidiariesnetofallowances Financial Assets THE COMPANY financial assetandliability: The tablebelowsummarisestheweightedaveragerateoffinanceasat31Decemberbymajorcurrenciesforeachclass Long datedswap Interest rateswap Cross-currency interestrateswap otal Borrowings .7 .7 7.89% 1.87% 5.57% .3 2.62% — 1.50% — 1.23% 3.99% ——— —— or notional rnia Favourable principal Contract ,2. 67.8 1,320.0 mutfairvalue amount 2003 5. 66.4 750.0 7. 1.4 570.0 MRM RM —— 2003 THE GROUPANDCOMPANY 4.00% .7 .9 7.24% 2.09% 6.37% .0 — — 2.92% 4.00% — 1.54% — 1.46% 4.16% S P RM JPY USD or notional ——4. rnia Favourable principal Contract mutfairvalue amount 4. 49.3 940.0 5. 47.5 750.0 9. 1.8 190.0 MRM RM 2002 —— 2002 00% nts.

237 238 1 FAIR VALUE OFFINANCIALASSETS ANDLIABILITIES 41. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS a On-balance-sheet (a) assumptions couldsignificantlyaffecttheseestimatesandtheresultingfairvalues. instruments, discountrates,estimatesoffuturecashflows,expectedlossexperienceandotherfactors.Changesin are significantlyaffectedbytheassumptionsusedandjudgementsmaderegardingriskcharacteristicsofvariousfinancial are estimatesderivedusingthenetpresentvalueorothervaluationtechniques.Theabovetechniquesinvolveuncertaintiesand and theCompany’s financialinstruments,quotedmarketpricesdonotexist.Forsuchfairvaluespresent Quoted marketprices,whenavailable,areusedasthemeasureoffairvalues.However, forasignificantportionoftheGroup between knowledgeableandwillingpartiesinanarm’s lengthtransaction,otherthaninforced orliquidationsale. The fairvalueofafinancialinstrumentisassumedtobetheamountatwhichcouldexchangedorsettled individual loanbasis. the Directorsareofopinionthat thepotentiallossesineventofdefaultwillbecoveredby collateralvalueson asset viaexchangewithanothercounterparty buttoholditcontractmaturity. Collateralsaretakenfor these loansand amountfullyrecoverable astheydonotintendtorealisethefinancial market rates.TheDirectorsconsider thecarrying amount atthebalancesheetdate as theCompanyanditssubsidiarieschargedinterestratesonstaff loansatbelowcurrent rates forsimilarcreditrisksandremaining periodtomaturity. Thefairvalueofstaffloansissignificantlylower thancarr The fairvalueofstaffloanshavebeen estimatedbydiscountingthefuturecashflowsusing theprevailingmarket amount netofallowancemadeisdeemedtobeacloseapproximationitsfairvalue. respect ofanyinvestment,thecarrying share ofnettangibleassets.Whereallowancespermanentdiminution invalueorimpairment,whereapplicable,ismade The fairvalueoflongterminvestmentsareestimatedbyreferenceto marketindicativeyieldsortheGroupandCompany’s Financial assets amountandnetfair valueoftotalborrowingsexcludeswaps,whicharedisclosedinsub-note(b). The abovecarrying Redeemable bonds/ T Investments Financial assets Convertible bonds Financial liabilities Staff loans approximated theirfairvaluesexceptassetoutbelow: amountsofthefinancialassetsandliabilitiesGroupCompanyatbalance sheetdate The carrying otal borrowings (excluding redeemable Payable toasubsidiary bonds) 31 DECEMBER arigNet Carrying ,1. 7,597.0 6,717.2 ,0. 3,000.0 3,000.0 mutfairvalue amount 6. 233.8 458.4 262.0 384.7 2003 MRM RM —— 2003 H RU THECOMPANY THE GROUP arigNet Carrying ,1. 6,307.8 5,618.6 ,6. 1,378.0 1,361.6 mutfairvalue amount 3. 289.8 184.9 331.8 139.6 MRM RM —— 2002 arigNet Carrying ,8. 2,959.9 2,983.5 6,264.0 5,746.0 mutfairvalue amount 6. 233.3 411.8 261.5 338.1 MRM RM —— 2003 arigNet Carrying ,2. 5,627.0 5,228.4 1,378.0 1,361.6 mutfairvalue amount 3. 289.7 331.7 83143.6 98.3 MRM RM —— 2002 ying ed 1 FAIR VALUE OFFINANCIALASSETS ANDLIABILITIES(continued) 41. b Off-balance-sheet (b) contracts areterminatedasat31 December2003orviceversa. valuations carriedoutbytheCompany’s bankers.Favourablefairvalueindicatesamountreceivablebythe Company ifthe Fair valuesoffinancialderivativeinstrumentsarethepresent oftheirfuturecashflowsandarearrivedatbasedon Interest rateswap Cross-currency interest Long datedswap Off-Balance-Sheet Financial adjustments areanalysedasbelow: term foreigncurrencyborrowings.Thecontractnotionalprincipalamountsofthederivativeandcorrespondingfairvalue The financialderivativeinstrumentsareusedtohedgeforeignexchangeandinterestraterisksassociatedwithcertainlong carrying valuesareassumedtoapproximatetheirfairvalues. carrying For allothershorttermon-balance-sheetfinancialinstrumentsmaturingwithinoneyearorarerepayableondemand,the to settletheseliabilitiesotherthaninaccordancewiththeircontractualobligations. valuesandnotattheirfairvalueastheDirectors havenointent The financialliabilitieswillberealisedattheircarrying valuesaregenerallyreasonableestimatesoftheirfair values. borrowings withfloatinginterestrate,thecarrying cash flowsusingtheprevailingmarketratesforsimilarcreditrisksandremainingperiodtomaturity. Forunquoted For unquotedborrowingswithfixedinterestrate,thefairvalueshavebeenestimatedbydiscountingfuture The fairvalueofconvertiblebondsandquotedhasbeenestimatedusingtherespectiveofferprice. Financial liabilities sheet date. However, amountsrecordedarenotanticipatedtobesignificantlyinexcessoftheirfairvaluesatthebalance thecarrying to determinethefairvaluesofthesebalancesastheyaremainlyinterestfreeanddonothavefixedrepaymentterms. For convertibleeducationloans,amountowingbysubsidiariesandassociatescustomers’deposits,itisnotpracticable Financial asset(continued) rate swaps Derivative Instruments Contract or rnia NetFairValue principal notional mutFvual Unfavourable Favourable amount 7. . — (95.8) — 1.4 — 570.0 66.4 760.0 750.0 MR RM RM RM 2003 THE GROUPANDCOMPANY Contract or rnia NetFairValue principal notional mutFvual Unfavourable Favourable amount 6. . (9.8) — 1.8 47.5 760.0 750.0 MR RM RM RM —— —— 2002 ion

239 240 2 PRIORYEARADJUSTMENTS 42. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS b Intangibleassets (b) Deferredtax (a) soits–a 1Dcme 021586—12792,746.5 1,388.2 1,207.9 — — 1,361.3 1,538.6 26.9 –at31 December2002 2002 –at1 January Associates Deferred tax H RU MR MRM (8,154.8) (39.7) RM 9,020.5 — RM 844.3 — (8,115.1) RM (39.7) (1,361.3) (172.3) 10,381.8 1,056.3 2002 –at1January Retainedprofits Reserves, Balance Sheet Profit fortheyearattributabletoshareholders T Operating costs Income Statement THE GROUP policies areasfollows: The abovechangesinaccountingpolicieshavebeenaccountedforretrospectively. Theeffectsofthechangesinaccounting financial yearended31December2002hasbeenrestated. accounting policyhasbeenaccountedforretrospectively. Accordingly, theConsolidatedBalanceSheetforpreceding has notbeenretrospectivelycapitalisedandsubjectedtoimpairmenttestasitwasimpracticalreinstate.Thechangein intheyearofacquisition.Suchgoodwill 2002waswrittenoffagainstreserves on acquisitionoccurredpriorto1January impairment mayexist.ImpairmentofgoodwillischargedtoConsolidatedIncomeStatementasandwhenitarises.Goodwill Capitalised goodwillistestedforimpairmentatleastannually, orifevents orcircumstances occurindicatingthatan Balance Sheetasintangibleassetor, ifarisinginrespectofanassociate,isincludedthecostinvestmentassociate isincludedintheConsolidated 2002inrespectofasubsidiary Goodwill onacquisitionoccurringorafter1January During theyear, theGroupchangeditsaccountingpolicywithrespecttogoodwill. differencesorunutilisedtaxlossescanbeutilised. the deductibletemporary Deferred taxassetsifany, arerecognisedtotheextentthatitisprobabletaxableprofitwillbeavailableagainstwhic as andwhentheyarise. differencesarenowtakenasprovisioninthefinancialstatementsperiod in accordancewithMASB25.Alltemporary differences future. TheGrouphasnowchangedthisaccountingpolicytothatoffullprovisioninrespectalltemporary except whereitwasconsideredreasonablyprobablethatthetaxeffectofsuchdeferralswillcontinueinforeseeable differences In previousyears,provisionwasmadefordeferredtax,usingtheliabilitymethod,onallmaterialtemporary compliance withMASB25“IncomeTaxes”. During theyear, theGroupchangeditsaccountingpolicywithrespecttorecognitionofprovisionfordeferredtaxin xto h opn n usdais(5.)(7.)—(626.7) — (172.3) (454.4) axation –thecompanyandsubsidiaries 31 DECEMBER t3 eebr20 671536—1,590.3 — 9,523.2 1,533.6 1,207.9 56.7 (1,533.6) 9,848.9 – at31December2002 – at31December2002 2003 rvosycag nplc As changeinpolicy previously eotd()()restated (b) (a) reported sEffectof As s. h 3 LISTOFSUBSIDIARIESASAT 31DECEMBER2003 43. PRIORYEARADJUSTMENTS (continued) 42. aeo opn hrhlig aia PrincipalActivities Capital Shareholdings Name ofCompany The subsidiariesareasfollows: Mobikom Sdn.Bhd. Menara KualaLumpurSdn.Bhd. Meganet CommunicationsSdn.Bhd. Mediatel (Malaysia)Sdn.Bhd. Intelsec Sdn.Bhd.* GITN Sdn.Berhad Fiberail Sdn.Bhd. Citifon Sdn.Bhd. eerdtx–a aur 02—1313—1,361.3 — 1,361.3 — 2002 –at1January Deferred tax osfrteya 362 123 (498.5) RM — RM (172.3) 10,434.0 RM (326.2) — RM (1,361.3) 11,795.3 2002 –at1January Retainedprofits Reserves, Balance Sheet Loss fortheyear T Income Statement THE COMPANY xto 397 123 (572.0) — (172.3) (399.7) axation t3 eebr20 ,3. 1,533.6 — 9,593.9 1,533.6 — — (1,533.6) 11,127.5 – at31December2002 – at31December2002 2003 100 100 100 100 100 100 70 60 fPaid-up % of 2002 100 100 100 100 100 100 70 60 RM260.0 RM91.0 RM11.0 RM20.0 RM14.2 RM65.0 Million RM4.0 RM3.0 2003 rvosycag nplc As change inpolicy previously eotd()()restated (b) (a) reported sEffectof As M6. Provision/transmissionofvoiceanddata RM260.0 M10Managementandoperationofthe RM91.0 Provisionofinteractive multimedia RM11.0 Provision ofmanagednetworkservices RM20.0 RM14.2 Provision RM65.0 Million M. Investmentholding RM4.0 Installationand maintenanceof RM3.0 2002 through thecellularsystem Menara KualaLumpur telecommunication andtourismtower of andsolution communication services security relatedimagingtechnology computerised securitysystemsand technology services telecommunication andinformation and enhancedvalueadded railway corridorinPeninsularMalaysia telecommunication systemalongthe Installation andmaintenanceofopticfibre and relatedservices of nationalpayphonenetwork

241 242 3 LISTOFSUBSIDIARIESASAT 31DECEMBER2003(continued) 43. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS aeo opn hrhlig aia PrincipalActivities Capital Shareholdings Name ofCompany T T T Societe DesTelecommunications Rebung UtamaSdn.Bhd. Parkside PropertiesSdn.Bhd.* T T T T T T T T T T T T T elekom ConsultancySdn.Bhd.* elekom AppliedBusinessSdn.Bhd. ekad Mercu Berhad elekom ManagementServices elekom Malaysia-AfricaSdn.Bhd. elekom InfotechSdn.Bhd.* elekom EnterpriseSdn.Bhd. elekom Malaysia(S)Pte.Ltd.** elesafe Sdn.Bhd.* elekom Technology Sdn.Bhd. Sdn.Bhd. elekom SalesandServices elekom Research &Development elekom PublicationsSdn.Bhd. elekom PayphoneSdn.Bhd. elekom NetworksMalawiLimited** elekom Multi-MediaSdn.Bhd. eGie* re De Guinee** d.Bd activitiesintheareasof Sdn. Bhd. Sdn. Bhd. engineering services in engineeringservices Sdn. Bhd. 31 DECEMBER 2003 2003 100 100 100 100 100 100 100 100 100 100 100 100 100 100 51 70 60 70 60 fPaid-up % of 2002 100 100 100 100 100 100 100 100 100 100 100 100 51 70 — 60 — 70 60 GFR75,000.0 MKW350.0 RM13.0 RM14.5 RM20.0 Million RM1.6 RM0.1 RM0.1 RM0.5 RM0.6 RM4.0 RM6.0 RM9.0 RM1.6 SGD# 2003 RM# RM# RM# RM# GFR75,000.0 K300Provisionoftelecommunicationand MKW350.0 M30Development,operationandmarketing RM13.0 Trading in RM14.5 Provisionofresearch anddevelopment RM20.0 Million M. Provisionofsoftwaredevelopmentand RM1.6 M. Dormant RM0.1 M. Investmentholding RM0.1 M. Dormant RM0.5 Investmentholdingandprovisionof RM0.6 M. Dormant RM4.0 RM6.0 Investment holdingandprovisionof RM9.0 M. Investmentholdingandprovisionof RM1.6 G#Provisionofinternational SGD# 2002 M Dormant RM# M Provisionofconsultancyand RM# M Specialpurposeentity RM- M Specialpurposeentity RM- sale ofsoftwareproducts and outsideMalaysia computer, dataandinformationwithin relatingtotelecommunication, services e-commerce services equipment and maintainingtelecommunication inrelatedbusiness services hi-tech applicationsandproducts telecommunication andmultimedia, services Provision ofprintingandpublications public telephoneservices inMalawi related services services andsolutions services interactive multimediacommunication telecommunication telecommunication facilities Provision oftelecommunicationand lated services intheRepublicofGuinea lated services customer premisesequipment 3 LISTOFSUBSIDIARIESASAT 31DECEMBER2003(continued) 43. aeo opn hrhlig aia PrincipalActivities Capital Shareholdings Name ofCompany T T TM (USA)Inc.** TM Cellular(Holdings)Sdn.Bhd. TM CellularSdn.Bhd. TM GlobalIncorporated## TM International(Cayman)Ltd.* TM International(Bangladesh) TM FacilitiesSdn.Bhd. Celcom (Malaysia)Berhad Subsidiaries heldthrough TM InternationalLeasing V Universiti Telekom Sdn.Bhd. TM OrionSdn.Bhd.* Subsidiaries heldthrough Mobitel Sdn.Bhd.* TM NetSdn.Bhd. TM InternationalSdn.Bhd. T elekom Malaysia(UK)Limited** elekom Malaysia(HongKong) elekom SmartSchoolSdn.Bhd. ADS Berhad iie* frel nw s telecommunicationfacilities TM (HongKong)Limited) Limited** (formerlyknownas Limited## services inBangladesh services Limited## T Incorporated## T elekom EnterpriseSdn.Bhd. elekom Multi-MediaSdn.Bhd. 69.52 2003 100 100 100 100 100 100 100 100 100 100 100 100 100 — 70 55 51 fPaid-up % of 69.52 31.25 2002 100 100 100 100 100 100 100 100 100 100 100 100 — 70 55 51 RM2,619.1 RM180.0 TK340.0 RM40.0 RM16.2 RM15.0 Million RM0.1 RM2.3 RM1.0 RM8.0 HKD# USD# USD# USD# USD# STR# 2003 RM# RM- M,6.0Provisionofmobiletelecommunication RM1,565.00 M,8. Provisionof mobile,fixedand RM1,983.6 M8. Provisionofinternetrelatedservices RM180.0 K4. Provisionofmobiletelecommunication TK340.0 M00Provision ofinternationalandnational RM40.0 M62Investmentholdingandprovisionof RM16.2 M50Implementationofgovernmentsmart RM15.0 Million M. Provisionoffacilitiesmanagement RM2.3 M. Managingandadministering aprivate RM1.0 RM8.0 K#Provisionofinternational HKD# S#Provisionofinternational USD# S#Investmentholding USD# S#Investmentholding USD# S#Investmentholding USD# T#Provisionofinternational STR# 2002 RM# M Marketandprovidevoice,data,video, RM- telecommunication facilities telecommunication facilities and relatedservices content andapplication wireless multimedia&interactive services businesses andorganisations for managed networkservices university knownasMultimediaUniversity Dormant multimedia services onaninternationalscale services telecommunication andconsultancy services andotherrelated services services education systemsandsoftware, portal school project,provisionofmultimedia Dormant

243 244 3 LISTOFSUBSIDIARIESASAT 31DECEMBER2003(continued) 43. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS aeo opn hrhlig aia PrincipalActivities Capital Shareholdings Name ofCompany Cybermall Sdn.Bhd. heldthrough Subsidiary MTN Networks(Pvt.)Limited## Subsidiaries heldthrough TM International(L)Limited## TM InternationalLanka(Pvt.) TMI MauritiusLimited## Celcom Multimedia(Malaysia) Celcom AcademySdn.Bhd. Subsidiaries heldthrough TESS InternationalLtd.* heldthrough Subsidiary Cambodia SamartCommunication G-Com Limited** Celcom Technology (M)Sdn.Bhd. Unitele MultimediaSdn.Bhd. heldthrough Subsidiary V V Subsidiaries heldthrough ADS SolutionsSdn.Bhd. Sdn.Bhd. ADS e-Services T TM InternationalSdn.Bhd. Limited## Co. Ltd.** services inCambodia services Celcom (Malaysia)Berhad TM International(L)Limited## Co. Ltd.** Sdn. Bhd.* Universiti Telekom Sdn.Bhd. V elekom PublicationsSdn.Bhd. ADS Berhad 31 DECEMBER 2003 2003 100 100 100 100 100 100 100 100 100 100 100 100 51 85 fPaid-up % of 2002 100 100 100 100 100 100 100 100 100 — — — 51 85 SLR370.0 SLR200.0 CED22.9 USD8.5 Million RM2.7 RM2.0 RM1.5 RM1.0 RM1.0 USD# USD# USD# 2003 RM# RM# L300Provisionofmobiletelecommunication SLR370.0 L200Investmentholding SLR200.0 E2. Investmentholding CED22.9 S85Provisionofmobiletelecommunication USD8.5 Million M. Provisionoftelecommunication, RM2.7 RM1.5 and Provisionofmanaged e-services RM1.0 S#Investmentholding USD# S#Investmentholding USD# S#Investmentholding USD# 2002 M Adoptingresearch ideasfromMultimedia RM# M Provisionoftelecommunicationvalue RM- Dormant RM- Provisionoftrainingrelated services RM- services multimedia andinformationtechnology services inSriLanka services forms oftelecommunication network throughcellularorother added services managed applicationservices business partnersinjointexercise University andcollaboratingwithother to facultiesandcentresatMultimedia prototyping, directingconsultancyproject University forfurtherdevelopmentand Provision ofsystemintegrationservices 3 LISTOFSUBSIDIARIESASAT 31DECEMBER2003(continued) 43. aeo opn hrhlig aia PrincipalActivities Capital Shareholdings Name ofCompany Celcom Timur (Sabah)Sdn.Bhd. Subsidiaries heldthrough Celcom Transmission (M)Sdn.Bhd. TR InternationalLimited** TR ComponentsSdn.Bhd. T T T Rego Multi-Trades Sdn.Bhd. TM CellularSdn.Bhd. T CT PagingSdn.Bhd.* Celcom Trunk Radio(M)Sdn.Bhd.* Malaysian MotorhomesSdn.Bhd.* Freemantle Holdings(M)Sdn.Bhd. Alpine Resources Sdn.Bhd.* Subsidiaries heldthrough Masterpage Sdn.Bhd.*^ heldthrough Subsidiary Firent ManagementServices CT CommunicationSdn.Bhd.*+ Subsidiaries heldthrough Alpha CanggihSdn.Bhd. heldthroughCelcom Subsidiary echnology Resources (Nominees) echnology Resources Manufacturing echnology Resources Management echnology Resources Celcom (Malaysia)Berhad Sdn. Bhd.* Sdn. Bhd.* Sdn.Bhd.* Services nutisBra managementservices Industries Berhad Industries Berhad T CT PagingSdn.Bhd. Sdn. Bhd.*+ Celcom Trunk Radio(M)Sdn.Bhd. T echnology Resources ransmission (M)Sdn.Bhd. 2003 62.4 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 60 fPaid-up % of 2002 — — — — — — — — — — — — — — — — — — — RM1,565.0 RM25.0 RM15.9 RM13.5 Million RM0.5 RM2.0 RM0.7 RM0.5 RM2.5 HKD# 2003 RM# RM# RM# RM# RM# RM# RM# RM# RM# Million K-Investmentholding HKD- 2002 M Provisionoffibreoptictransmission RM- M Provisionoftransmissionnetwork RM- M Investmentholding RM- Dormant RM- Inactive RM- Inactive RM- M Dealinginmarketablesecurities RM- M Ceasedoperations RM- M Provisionofmobiletelecommunication RM- Investmentholdingandprovisionof RM- Inactive RM- Ceasedoperations RM- M Investmentholding RM- Inactive RM- Dormant RM- Dormant RM- Dormant RM- M Propertyinvestment RM- network related services and relatedservices

245 246 3 LISTOFSUBSIDIARIESASAT 31DECEMBER2003(continued) 43. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS S USDollar Bangladesh Taka USD Pound Sterling –USA TK SriLanka Rupee STR –HongKong SingaporeDollar SLR MalawiKwacha SGD HongKongDollar MKW GuineaFranc HKD Ghanaian Cedi –Mauritius GFR CED + ^ NotauditedbymemberfirmsofPricewaterhouseCoopers –FederalTerritory, Labuan ** AuditedbyamemberfirmofPricewaterhouseCoopers –FederalTerritory, Labuan –BritishWest Indies,USA –FederalTerritory,## Labuan –SriLanka –Mauritius # * –Ghana –Bangladesh TR InternationalLimited** TM (USA)Inc.** PlaceofIncorporation –SriLanka T T T TMI MauritiusLimited## –RepublicofGuinea TM InternationalLeasingIncorporated## TM InternationalLanka(Pvt.)Limited## –Cambodia TM International(L)Limited## TM International(Cayman)Ltd.* TM International(Bangladesh)Limited## TM GlobalIncorporated## TESS InternationalLtd.* T Societe DesTelecommunications DeGuinee** MTN Networks(Pvt.)Limited## G-Com Limited** Cambodia SamartCommunicationCo.Ltd.** Name ofCompany All subsidiariesareincorporatedinMalaysiaexceptthefollowing: lkmMlyi U)Lmtd*–UnitedKingdom –Singapore –HongKong –Malawi elekom Malaysia(HongKong)Limited** elekom Malaysia(UK)Limited** elekom Malaysia(S)Pte.Ltd.** elekom NetworksMalawiLimited** Undergoing members' voluntary windingupunderSection254oftheCompaniesAct,1965 Undergoing members'voluntary In theprocessofbeingderegisteredunderSection308CompaniesAct,1965 Amounts lessthan0.1millionintheirrespectivecurrency Inactive asat31December2003 31 DECEMBER 2003 4 LISTOFASSOCIATES ASAT 31DECEMBER2003 44. aeo opn hrhlig Principal Activities Shareholdings Name ofCompany The associatesareasfollows: Celcom (Malaysia)Berhad* 5by5 NetworksInc.# mySPEED.com Sdn.Bhd. Sistem IridiumMalaysiaSdn.Bhd.** Mahirnet Sdn.Bhd. Associates heldthrough Mutiara.Com Sdn.Bhd. Cambodia NationalCommunicationInc. Associates heldthrough Samart CorporationPublicCompanyLimited Thintana CommunicationsLlc. Associate heldthrough Celcom Timur (Sarawak)Sdn.Bhd.## Associate heldthrough T Associate heldthrough Mobile Telecommunications Company Associates heldthrough TRI Telecommunication Tanzania Sheba Telecom (Pvt.)Ltd.##(sub-notea) Fibrecomm Network (M)Sdn.Bhd. Associate heldthrough elkom SALimited T TM InternationalSdn.Bhd. T Celcom (Malaysia)Berhad Thintana CommunicationsLlc. T Limited ##/*** fEfhn(..–PJS)GSMcellulartelecommunicationnetworkto customers in of Esfahan(J.V. –P.J.S.) Celcom Transmission (M)Sdn.Bhd. elekom Multi-MediaSdn.Bhd. elekom Malaysia-AfricaSdn.Bhd. echnology ResourcesIndustriesBerhad 16.22 19.59 2003 86.4 — — 40 49 30 — 40 30 60 49 60 41 % of 12 Provision ofmobile,fixedandmultimediaservices 31.25 16.22 19.73 2002 65Research anddevelopment oftelecommunicationproducts 16.5 0Dormant 40 9Development,managementandmarketingofeducational 49 30 2Provisionoftrunklandmobileradioservices 42 0Investmentholding 40 0Provision oftelecommunicationandrelatedservices 30 —T — — — — institutions electronically products offeredbylocalandoverseaseducational services Provision ofpromotioninternet-basedcommunication equipment systems andthesaledistributionoftelecommunication Design, implementationandinstallationoftelecommunication the provinceofEsfahan,Iran Provision oftelecommunicationservices Planning, designing,installing,operatingandmaintaininga Provision oftelecommunicationservices Provision offibre optictransmissionnetworkservices related activitiesandothercomputerisedorelectronicservices multimedia including electroniccommerce services, delivery Creating, implementingandoperatinge-businessactivities elecommunication services

247 248 6 CURRENCY 46. COMPARATIVE 45. LISTOFASSOCIATES ASAT 31DECEMBER2003(continued) 44. ENDED YEAR THE FOR NOTES TO THEFINANCIALSTATEMENTS hb eeo Pt)Ld –Bangladesh On18March 1999,theboardofdirectorsShebaTelecom (Pvt.)Ltd.(Sheba)approvedtheincreaseofcompany’s –USA (a) –USA –Tanzania Treated asassociatesduetolossofcontrolwhilemaintainingsignificantinfluence ## PlaceofIncorporation #T Liquidatorappointed Inactiveasat31December2003 *** ** * –Thailand –Cambodia –Iran and31MarchLimited withfinancialyearendson31January respectively. All associateshaveco-terminousfinancialyearendwiththeCompanyexceptformySPEED.COMSdn.Bhd.andTelkom SA Mobile Telecommunications CompanyofEsfahan(J.V. –P.J.S.) TRI Telecommunication Tanzania Limited Sheba Telecom (Pvt.)Ltd. T Thintana CommunicationsLlc. Samart CorporationPublicCompanyLimited 5by5 NetworksInc. Cambodia NationalCommunicationInc. Name ofCompany All associatesareincorporatedinMalaysiaexceptthefollowing: All amounts are expressed in Ringgit Malaysia (RM) unless otherwise stated. All amountsareexpressedinRinggitMalaysia(RM)unlessotherwise ensure comparabilitywiththecurrentyearpresentation. As mentionedintherespectivenotestofinancialstatements,certain comparativeshavebeenreclassifiedand/orexpandedt lo ALmtd–SouthAfrica elkom SALimited the financialstatements. dispute withSheba’s minorityshareholdersispendingtheresultofarbitrationproceedingsdescribedinnote35(j)to yet tolodgeanotificationoftheincreaseinshareholdingwithRegistrarJointStockCompanies.Theoutcome However, capitalisationoftheintercompany advanceswasdisputedbytheminorityshareholdersofShebaandhas Resources Industries Berhad(TRI).Basedonthisincreaseinsharecapital,TRI’s equityinterestinShebastandsat86.4%. paid-up sharecapitalfromTaka40,204,000 toTaka327,996,000 viacapitalisationofadvancesmadebyTechnology 29.16% heldthroughTelekom EnterpriseSdn.Bhd. reated aslongterminvestmentin2003duetolossofsignificantinfluence 31 DECEMBER 2003 o Kuala Lumpur Commissioner forOaths T. ) Before me: ) 2004 this 26February ) declared atKualaLumpur Subscribed andsolemnly Declarations Act,1960. and Imakethissolemndeclarationconscientiouslybelievingthe same tobetrueandbyvirtueoftheprovisionsStatuto and sincerelydeclarethattothebestofmyknowledgebelief,financialstatementssetoutonpages169248arecor I, JaffaSanyMdAriffin,beingtheOfficerprimarilyresponsibleforfinancialmanagementofTelekom MalaysiaBerhad,dos STATUTORY DECLARATION Chief Executive DATO’ DR.MDKHIRBINABDULRAHMAN Chairman T 2004. In accordancewitharesolutionoftheBoardDirectorsdated26February standards inMalaysiaandtheprovisionsofCompaniesAct,1965. flows oftheGroupandCompanyforyearendedonthatdateinaccordancewithapplicableapprovedaccounting a trueandfairviewofthestateaffairsGroupCompanyasat31December2003results Malaysia Berhad,statethat,intheopinionofDirectors,financialstatementsonpages169to248aredrawnupsoast We TO PURSUANT STATEMENT BYDIRECTORS AN SRIDATO’ Ir. MUHAMMADRADZIBINHAJIMANSOR

THANAPALASINGAM , Tan SriDato’Ir. MuhammadRadzibinHajiMansorandDato’Dr. MdKhirbinAbdulRahmanbeingtwooftheDirectorsTelek S ECTION 169(15) JAFFA SANYMDARIFFIN FTHE OF C OMPANIES A CT , 1965 o exhibit olemnly cash rect, om ry

249 250 A:14)[904/03/04(J/PH)] Partner ABDULRAHIMHAMID 2004 Date: 26February Kuala Lumpur Chartered Accountants (AF: 1146) PRICEWATERHOUSECOOPERS not includeanycommentmadeundersubsection(3)ofsection174theAct. companieswerenotsubjecttoany material qualificationan The auditors'reportsonthefinancialstatementsofsubsidiary informationandexplanationsrequiredbyusforthosepurposes. and wehavereceivedsatisfactory statements areinformandcontentappropriateproperforthepurposesofpreparationconsolidatedfinancialsta We We companiesofwhichwehavenotactedasauditorsareindicatedinnote43 tothefinancialstatemen The namesofthesubsidiary (b) and (a) In ouropinion: statements presentation.We believethatourauditprovidesareasonablebasisforopinion. assessing theaccountingprinciplesusedandsignificantestimatesmadebyDirectors,aswellevaluatingoverallfin examining, onatestbasis,evidencesupportingtheamountsanddisclosuresinfinancialstatements.Anauditalsoincludes the audittoobtainreasonableassuranceaboutwhetherfinancialstatementsarefreeofmaterialmisstatement.Aninc We Company’s Directors.Ourresponsibilityistoexpressanopiniononthesefinancialstatementsbasedouraudit. We TO REPORT OFTHEAUDITORS

conducted ourauditinaccordancewithapprovedAuditingStandardsMalaysia.Thosestandardsrequirethatweplanandper have considered the financial statements of these subsidiary companiesandtheauditors’reportsthereon. have consideredthefinancialstatementsofthesesubsidiary THE are satisfied that the financial statements of the subsidiary companiesthathavebeenconsolidatedwith the Company'sfinan are satisfiedthatthefinancialstatementsofsubsidiary have auditedthefinancialstatementssetoutonpages169to248.Theseareresponsibilityof companies ofwhichwehaveactedasauditorsbeenproperlykeptinaccordancewiththeprovisionsAct. the accountingandotherrecordsregistersrequiredbyActtobekeptCompanysubsidiary thestateofaffairsGroupandCompanyasat31December2003resultscashflows (ii) themattersrequiredbysection169ofCompaniesAct,1965tobedealtwithinfinancialstatements;and (i) approved accountingstandardsinMalaysiasoastogiveatrueandfairviewof: the financialstatementshavebeenpreparedinaccordancewithprovisionsofCompaniesAct,1965andapplicable M and Companyfortheyearendedonthatdate; MESOF EMBERS T ELEKOM M ALAYSIA B ERHAD (C OMPANY N O : 128740-P) tements ancial d did ludes form cial ts. .Theaveragenumberofemployeesattheendfinancialyearamountedto: 4. TheprincipalofficeandplaceofbusinesstheCompanyis: 3. TheaddressoftheregisteredofficeCompanyis: 2. Telekom MalaysiaBerhadisapubliclimitedliabilityCompany, incorporatedanddomiciledinMalaysia,listedonthemain 1. AT AS GENERAL INFORMATION Group 50672 KualaLumpur Off JalanPantaiBaharu Menara Telekom Level 51,NorthWing Company SecretarialDivision 50672 KualaLumpur Off JalanPantaiBaharu Menara Telekom Level 51,NorthWing board oftheMalaysiaSecuritiesExchangeBerhad. Company 31 D ECEMBER 2003 33,726 22,513 2003 31,940 24,354 2002

251 252 6,6,1 n bv .1——19015545.5—— 15.05 — 500,722,037 — 84.95 2,824,528,344 784 10.24 0.02 0.47 58.65 0.09 636,970 2,715 1,950,165,554 15,683,610 3,182,832 — — 89.76 0.85 0.21 1.61 2,160 23,806 28,182,406 — 6,843,615 53,458,628 Shares 1.36 3.67 0.01 3.42 0.07 362 973 4 906 18 4.02 27.40 56.19 TOTAL 1.20 1,066 7,268 14,903 166,262,519 andabove 317 100,001 –166,262,518 Shareholders 10,001 –100,000 1,001 –10,000 100 –1,000 Less than100 Size ofShareholdings DISTRIBUTION OFSHAREHOLDINGS sharesofRM1eachand1(one)SpecialRightsRedeemablePreference 3,325,248,380ordinary : V RM5,000,000,021 : RM3,325,248,401 Class ofShares : Issued andFullyPaid-upCapital Authorised ShareCapital Share Capital ANALYSIS OFSHAREHOLDINGS AT AS SHAREHOLDING STATISTICS oting Rights : One vote per ordinary share. Onevoteperordinary : oting Rights 10 20 30 40 50 60 Share Volume aia)2809 5 .27585912.341278114.47 481,217,841 23.63 785,875,981 1.72 456 0.94 248 capital) (less than5%ofpaid-up , , , , , , 000 000 000 000 000 000 0 19 M ( ’ Jan 000 ARCH 2 ) 003 2004 M F eb O NTHLY TRADIN M ar statements. The SpecialSharehasnovotingrightotherthanthosereferredtoinnote10(a)thefinancial each fullypaidand1,000ClassBRedeemablePreferenceSharesofRM0.01paid. Share ofRM1eachandfullypaid,1,000ClassARedeemablePreferenceSharesRM0.01 o%N o%N % No % No % No % No aasa oeg aasa Foreign Malaysian Foreign Malaysian V Ap o l r u m e G Ma V y O L U Jun ME Hi g & hes

Jul t HI G HEST-L Au g O WEST SHAREPRIC Se p Lowes t O c t N ov E Share Price D ec ( RM 0.000 2. 4. 6 8 1 . . 0 ) 00 00 00 00 . 00 6 atbnNmne Aig d.Bd ,8,0 0.18 0.18 0.18 6,084,000 6,092,000 0.18 6,105,000 6,111,400 0.22 0.19 0.19 0.29 0.27 7,466,000 6,413,611 6,213,300 9,511,500 0.35 8,959,300 0.60 11,539,200 0.40 19,822,000 0.41 CartabanNominees(Asing)Sdn.Bhd. 26. 13,353,400 HSBCNominees (Asing)Sdn.Bhd. 25. Kumpulan Wang AmanahPencen 13,701,500 0.64 24. CartabanNominees (Asing)Sdn.Bhd. 23. 21,171,220 0.85 AmanahRaya Nominees(Tempatan) Sdn.Bhd. 22. CiticorpNominees (Asing)Sdn.Bhd. 21. Kumpulan Wang AmanahPencen 28,217,000 20. MalaysiaNational InsuranceBerhad 19. PertubuhanKeselamatanSosial 18. HSBCNominees(Asing)Sdn.Bhd. 17. AmanahRayaNominees(Tempatan) Sdn.Bhd. 16. AmanahRayaNominees(Tempatan) Sdn.Bhd. 15. BankSimpananNasional 14. MalaysiaNominees(Tempatan) SendirianBerhad 13. LembagaTabung Haji 12. Valuecap Sdn.Bhd. 11. AmanahRayaNominees(Tempatan) Sdn.Bhd. 10. AT AS LIST OFTOP 30SHAREHOLDERS o Name No. .Kmua agAaa ecn5,5,0 1.73 4.89 0.86 57,551,000 7.57 162,759,000 4.93 28,688,600 251,680,000 32.46 5.83 12.78 164,000,000 1,079,524,854 424,960,700 194,000,000 AmanahRayaNominees(Tempatan) Sdn.Bhd. 9. KumpulanWang AmanahPencen 8. MinisterofFinance 7. PermodalanNasionalBerhad 6. CiticorpNominees(Asing)Sdn.Bhd. 5. CimsecNominees(Tempatan) Sdn.Bhd. 4. BankNegaraMalaysia 3. EmployeesProvidentFundBoard 2. KhazanahNasionalBerhad 1. Investors BankandTrust CompanyforIshares,Inc. BBH AndCoBostonforGMOEmergingMarketsFund Government ofSingaporeInvestmentCorporationPteLtdfor ofSingapore(C) Public GrowthFund American InternationalAssuranceCompanyLimited(PCore) Abu DhabiInvestmentAuthority Skim AmanahSahamNasional Amanah SahamWawasan 2020 Great EasternLifeAssurance(Malaysia)Berhad(PAR 1) Amanah SahamMalaysia Skim AmanahSahamBumiputera CBSGP GWSporeforHibiscusInvestmentsPteLtd Security Trustee (KCWIssue2) 19 M ARCH 2004 1,0,1 3.37 111,901,219 509060.75 0.81 25,019,036 27,000,000 hrsPercentage Shares ed(%) Held

253 254 ao i hn un———1,0 * — * 10,000 % — — Indirect — 10,000 Direct — — % * — Indirect — — Direct * 110,000 T Dato’ LimKhengGuan Dato’ Dr. MohdMunirbinAbdulMajid Y Dato’ Dr. AbdulRahimbinHajiDaud T Name ofDirectors are asfollows:- In accordancewiththeRegisterofDirectors’Shareholdings,directors’ interestinsharestheCompanyanditsrelatedc AND ITS RELATED CORPORATION ASAT 19MARCH2004 DIRECTORS’ DIRECTANDINDIRECTINTEREST INTHECOMPANY 0.16 0.16 0.16 Deemed interestbyvirtueofsharesheldcorporationsrelatedtoTemasek* Holdings(Private)Limited(Section6AoftheCom 0.17 5,216,100 5,250,000 5,300,000 5,503,000 SUBSTANTIAL SHAREHOLDERS’HOLDINGS(5%ANDABOVE) AmanahRayaNominees(Tempatan) Sdn.Bhd. 30. CiticorpNominees(Tempatan) Sdn.Bhd. 29. CartabanNominees(Asing)Sdn.Bhd. 28. CartabanNominees(Asing)Sdn.Bhd. 27. AT AS LIST OFTOP 30SHAREHOLDERS o Name No. * o Name No. nPhKa 500—* — 15,000 * an PohKeat — 123,500 an SriDato’Ir. MuhammadRadzibinHajiMansor B ao oehSln adm1,0 1,500* 15,000 .B. Dato’JosephSalangGandum .Bn eaaMlyi 5,8,0 7.57 2 5.09 1 251,680,000 32.46 5.83 12.78 169,310,200* 1,079,524,854 424,960,700 194,000,000 Temasek Holdings(Private)Limited 5. CimsecNominees(Tempatan) Sdn.Bhd. 4. BankNegaraMalaysia 3. EmployeesProvidentFundBoard 2. KhazanahNasionalBerhad 1. Act, 1965) Deemed interestbyvirtueofshares heldbyhisspouse,MadamHonPhaikHong,pursuanttoSection6A oftheCompaniesAct,1965 Less than0.1% Public IndexFund Ing InsuranceBerhad(Inv-ILPar) State StreetAustraliaFundQ3VDforFullerton(Private)Limited State StreetLondonFund3ERFforDeutscheGlobalEmergingMarkets(Select) TOTAL TOTAL 19 M ARCH 2004 T lkmMlyi ehdVADS Berhad elekom MalaysiaBerhad 2 * 1 1 1 1 000—* * — * * — 10,000 — — 10,000 10,000 11,000 ,1,7,5 63.73 2,119,475,754 81.76 2,719,113,940 hrsPercentage Shares hrsPercentage Shares ed(%) Held ed(%) Held orporation panies 1 1 1 1 1 1 a 03-79552510 : Fax 50672 KualaLumpur Off JalanPantaiBaharu Level 8,SouthWing,MenaraTelekom T Corporate AffairsDivision Corporate CommunicationsUnit General Manager The AnnualReportisavailabletothepublicwhoarenotshareholdersofCompany, bywritingto:- is nofurthertaxorwithholdingonthepaymentofdividendstoallshareholders. The incometaxdeductedordeemedtohavebeenfromdividendisaccountedforbytheofcompany. There paid byacompanyresidinginMalaysia. Malaysian incometaxisdeductedordeemedtohavebeenatcorporaterate,whichcurrently28%fromdividend dividends distributedtoshareholders. Malaysia practisedanimputationsysteminthedistributionofdividendswherebyincometaxpaidbyacompanyisimpute MALAYSIAN TAXES ONDIVIDEND The Company’s sharesarelistedontheMalaysiaSecuritiesExchangeBerhadinMalaysia. LISTING 03-40426352 : Fax Te 50400 KualaLumpur Jalan Kampar, OffJalanTun Razak 20th Floor, PlazaPermata T REGISTRAR SHAREHOLDERS ANDINVESTOR INFORMATION elekom MalaysiaBerhad enaga KoperatSdn.Bhd.(118401-V) l: 03-4041 6522 (formerly knownasIGBPlaza) d to s

255 oainLt ’0 qf)Lt ’0 qf)Lt ’0 qf)Lt ’0 qf)(ilo)(million) 256 (million) (’000sqft) Lots (’000sqft) Lots (’000sqft) Lots (’000sqft) Lots Location *Exceptedlandarelandssituatedoutside theFederalTerritory landownedbytheFe whichareeitheralienatedland,reserved ** * No revaluationhasbeenmadeonanyofthelandandbuildings AT AS NET BOOKVALUE OFLAND&BUILDINGS 0 abda—————————1.4 2.0 1.3 — 0.5 2.2 — 0.9 12.1 0.2 — — 9.5 13.1 — — — 100.8 — 116.0 — 8.3 — 103.4 — 12.2 28.0 29.6 — — — 6.5 — — 26,290 — 10,284 2.4 47.3 — — — 8,409 76 — 109 — 2,234 2.0 — — 468 655 — 272 98 — 41 — 92 6,285 691 — — 10 6 173 — 13 — 41 34 919 18 — 17 351 90 129 4 — — — 1,856 30 3 18 463 89 — 7 4 44 522 — — 7,502 1,585 80 11 4 Cambodia 7 68 20. — SouthAfrica — 20 19. Bangladesh 4 18. — RepublicofGuinea 17. — Malawi 16. SriLanka — 15. Sarawak 14. Sabah 13. Pahang 12. Kelantan 11. Terengganu 10. .Mlk 66,4 0383 ,5 47128.6 82.8 39.0 131.2 4.3 54.7 83.9 4.8 12.1 53.8 4,457 77.4 0.4 58.7 2,818 9,371 14,097 38 9.2 750 7,780 138 55 71 10,318 15,431 516 704.0 119 — 317 14 2 297 60 150.5 — 16 63,141 6 — 16,698 — 5 1,302 26 1,404 321 97 — 679 — 3 28 1,856 52 14 9 1,465 148 511 17 9 2 47,593 4 19 61 11 25,479 9 20 18 — 18 5 9,413 8 NegeriSembilan — 9. Melaka 9 8. Johor 7. Kedah 6. PulauPinang 5. Perak 4. Perlis 3. Selangor 2. FederalTerritory 1. 85 and86oftheFederalConstitution. Government hasagreedtoleasethese landtoTelekom Malaysia Berhadforatermof60yearswithanoptiontorenew, underarti Pinang, SabahandSarawak)as set outinSection3(2)oftheTelecommunication (Successor Company)Act,1985.The Services Government orlandoccupied,used, controlledandmanagedbytheFederalGovernmentforfederal purposes(inMelaka,Pulau relevant authorities,thelandhavenotbeenclassifiedaccordingto theirtenureandlandareasarebasedonestimation. The titledeedspertainingtootherlandhavenotyetbeenregistered inthenameofCompany. Pendingfinalisationwithth .Lba 1 8.5 — — 1,492.0 — 145.7 710 — 5 — — 1,141 12 — 502 — 8 — 1,192 16 Labuan b. KualaLumpur a. T tl136,5 8 961191,4 5 2,0 6. 3,177.6 563.7 124,904 957 17,543 109 99,611 284 67,256 173 otal 31 D ECEMBER o fAe o fAe o fAe N.o raR RM RM Area No.of Area No.of Area No.of Area No. of 2003 reodLaeodOhrLn*Ecpe ad*o adBuildings ofLand ExceptedLand** OtherLand* Leasehold Freehold e ok NetBook Net Book V alue Value of deral cle e oainEcagsSain ulig eieta aeossSain eotCnr nvriyTower University Centre Resort Stations Warehouses Residential Buildings Stations Exchanges Location SAT AS USAGE OFPROPERTIES 4 aaa 24 44 51—1—— — — — — — — — 1 3 — — — — 2 — — 1 1 — — — 1 — 4 1 — 2 — 2 12 3 — — 4 — 25 22 — 2 — — — 17 — 13 5 47 — 22 — 7 5 6 1 49 18 21 24 27 21 — 2 — 14 15 43 7 133 — 33 Cambodia 20. 34 — SouthAfrica 5 26 72 19. 6 Bangladesh 45 18. RepublicofGuinea 45 17. 17 Malawi 23 16. SriLanka 15. Sarawak 33 14. Sabah 13. Pahang 12. Kelantan 11. Terengganu 10. .Mlk 8252 — — — 1 1 — — 1 — — — — 4 1 2 — — — — — — 2 2 2 1 1 1 4 1 1 6 — — 6 — 1 22 — — 11 — 2 23 — 51 42 1 16 — 26 23 5 7 81 41 4 4 2 2 33 17 32 15 — 11 — 18 18 90 22 31 18 48 — — 70 NegeriSembilan 11 9. 10 29 Melaka 8. Johor 85 7. Kedah 6. PulauPinang 5. Perak 4. Perlis 3. Selangor 2. FederalTerritory 1. .KaaLmu 862 81 1 — — 2 — 12 1 4 19 1 28 2 22 3 6 28 Labuan b. KualaLumpur a. 31 D ECEMBER T asiso fieSoe/CbeBsns Tourism Business Cable Stores/ Office ransmission 2003 umrn rmtl munication/ Primatel/ Submarine aelt/KdiT/Telecom- KedaiTM/ Satellite/ ———— ———— ———— ———— ———— ———— ———— ————

257 258 a 03-20316730 : Fax T Jalan RajaChulan,50200KualaLumpur 1B Floor, BangunanTelekom BUKIT MAHKAMAH Kedai Telekom 03-20702020 : Fax T 50200 KualaLumpur 76, JalanRajaChulan 25th Floor, MenaraWeld TELEKOM MALAYSIA BERHAD Primatel BusinessCentre 03-20314460 : Fax T Jalan RajaChulan,50200KualaLumpur 1A Floor, BangunanBukitMahkamah Consumer AndBusiness TELEKOM MALAYSIA BERHAD Centre Customer Service 03-20702355 : Fax T 50200 KualaLumpur 76, JalanRajaChulan 25th Floor, MenaraWeld TELEKOM MALAYSIA BERHAD General Manager, StateBusinessOperations KUALA LUMPUR WILAYAH PERSEKUTUAN 03-22832415 : W Fax T Level 51,NorthWing,MenaraTelekom, OffJalanPantaiBaharu,50672KualaLumpur HEAD OFFICE: GROUP DIRECTORY l 03-20729191 : el. 03-20205335 : el. 03-20261050 : el. 03-20206186 : el. l 03-22409494 : el. bie:www.telekom.com.my : ebsite a 03-7956 4543 : Fax T Jalan PantaiBaharu,59200Kuala Lumpur Ground Floor, SHOWROOM 03-62750445 : Fax T 16, Jalan54,DesaJaya,52100Kepong KEPONG 03-40229292 : Fax T 53200 KualaLumpur 44, PersiaranKuantan T Ground Floor, SETAPAK 03-92859595 : Fax T 55100 KualaLumpur Jalan Jejaka,Taman Maluri Maluri BusinessCentre Lot 1&2,Block154 MALURI 03-40411988 : Fax T 50400 KualaLumpur 94, JalanDatoHj.Eusoff 1st Floor, WismaKotamas KOMPLEKS DAMAI 03-20709393 : Fax T Jalan RajaChulan,50200KualaLumpur Ground Floor, BangunanMuziumTelekom MUZIUM l 03-20207712 : el. 03-62769191 : el. 03-40229191 : el. elekom Setapak 03-92859292 : el. 03-40410289 : el. 03-20723177 : el. Wisma Telekom Bangunan Ibusawat a 03-2694 3463 : Fax T 50300 KualaLumpur Jalan MedanTuanku Satu Ground Floor, No.7&9 MEDAN TUANKU 03-26810421 : Fax T Kuala Lumpur Jalan RajaMudaAbdulAziz No. 82,MenaraCELCOM MENARA CELCOM 03-9132 4373 : Fax T KM 12,JalanIpoh,68100KualaLumpur No. 115,Jalan2/3A,PusatBandarUtara, SELAYANG 03-92874900 : Fax T 56100 Cheras,KualaLumpur 8, JalanPuduUlu Lot 1.03,MenaraPGRM 03-91324373 : Fax T 56100 KualaLumpur 62, JalanManis3,Taman Segar, Cheras CHERAS 03-21625093 : Fax T 50450 KualaLumpur 161B, JalanAmpang 2nd Floor, MenaraTR Central RegionalOffice CELCOM (MALAYSIA) BERHAD Centres Service CELCOM l 03-26941313 : el. 03-26873838 : el. 03-6136 9766 : el. 03-92864900 : el. 03-91324379 : el. 03-21623900/5092 : el. a 03-55188815 : Fax T 40000 ShahAlam No. 6,PersiaranDamai,Seksyen11 Ground Floor, WismaTelekom ShahAlam TELEKOM MALAYSIA BERHAD Primatel BusinessCentre 03-79559495 : Fax T Jalan Sultan,46050PetalingJaya MBS PJ,2ndFloorMenaraPKNS TELEKOM MALAYSIA BERHAD Centre Customer Service 03-55125133 : Fax T 40000 ShahAlam No. 6,PersiaranDamai,Seksyen11 1st Floor, WismaTelekom ShahAlam TELEKOM MALAYSIA BERHAD General Manager, StateBusinessOperations PETALING JAYA SELANGOR/ areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService 03-77264900 : Fax T 60000 KualaLumpur T AB 40,JalanTun MohdFuad T 03-40253900 : Fax T Off JalanPahang,53000KualaLumpur Lot 14(129),JalanPahangBarat Ground Floor, PharmacareBuilding Pekeliling BusinessCentre PEKELILING l 03-55188820 : el. 03-79682010 : el. 03-55188700 : el. 03-77263900 : el. aman Tun Dr. Ismail 03-4025 5900 : el. AMAN TUNDR.ISMAIL a 03-32893300 : Fax T Jalan Klinik,45000KualaSelangor Bangunan Telekom KUALA SELANGOR 03-31879791 : Fax T Jalan Chempaka,42400Banting Bangunan IbusawatTelekom BANTING 03-55105500 : Fax T Seksyen 11,40150ShahAlam Bgn. Telekom ShahAlam,PersiaranDamai SHAH ALAM 03-33429292 : Fax T Jalan Meru,41050Kelang BUKIT RAJA(KLANG) 03-60643700 : Fax T 44000 KualaKubuBahru Kuala KubuBahru 1st Floor, IbusawatTelekom KUALA KUBUBARU 03-60918000 : Fax T Lot 21,JalanMaxwell,48000Rawang RAWANG 03-42528282 : Fax T Ampang Point,68000 42, JalanMemanda7 AMPANG 03-31669292 : Fax T 41672 JalanPerbandaran,Klang Pelabuhan Klang 2-1, 2ndFloor, BangunanHentian PORT KLANG Kedai Telekom l 03-32893030 : el. 03-31872422 : el. 03-55109191 : el. 03-33419191 : el. 03-60643291 : el. 03-60919191 : el. 03-42519191 : el. 03-3166 9191 : el. T Ground Floor, BangunanIbusawat KAJANG 03-56336764 : Fax T 85, JalanSS15/5A,47500SubangJaya SUBANG JAYA 03-79540326 : Fax T 46050 PetalingJaya 20, JalanYong ShookLin PETALING JAYA 03-77269292 : Fax T Damansara Utama,47400PetalingJaya 91-93, JalanSS21/1A DAMANSARA UTAMA 03-32162058 : Fax T 35, JalanMenteri,45200SabakBernam SABAK BERNAM a 03-87332000 : Fax T 43400 Kajang a 03-33431001 : Fax T Bandar BaruKlang,41150Klang No. 1,LorongTiara 1A KLANG 03-2162 5093 : Fax T 50450 KualaLumpur Menara TRI,161B,JalanAmpang Podium Block,Level1&2 JALAN AMPANG 03-7625 0900 : Fax T 46050 PetalingJaya No. 17JalanYong ShookLin Ground Floor, MenaraPKNSPJ PETALING JAYA Centres Service CELCOM elekom Kajang,Bt14 03-56319191 : el. 03-79569191 : el. 03-7727 9191 : el. 03-3216 2716 : el. l 03-87369191 : el. l 03-33431003 : el. 03-21623900 : el. 03-76259900 : el. 1 ⁄ 2 , JalanCheras

259 260 a 04-7300630 : Fax T Jalan KolamAir, 05672AlorStar TELEKOM MALAYSIA BERHAD Centre Customer Service 04-7339090 : Fax T Jalan KolamAir, 05672AlorStar TELEKOM MALAYSIA BERHAD General Manager, StateBusiness Operations KEDAH/PERLIS T arealsoavailableatKedai services Internet registrationandbillpayment [email protected] 03-78045910 E-mail: : Fax T No. 1,JalanSS6/2,47301KelanaJaya Ground Floor, KelanaParkViewTower CLICKERS Centre TM NetService 03-87373019 : Fax T Selangor 43000 Kajang Jalan SungaiChua Lot No.1,Taman SriSaga KAJANG 03-31665900 : Fax T 42000 PortKlang No. 2,LorongCungah PORT KLANG 03-55121900 : Fax T 91B, Section9,40000ShahAlam No. 1,JalanTengku AmpuanZabedahB SHAH ALAM GROUP DIRECTORY l 04-7319255 : el. 04-7302552 : el. elekom. 03-78048176 : el. 03-87372900 : el. 03-31664900 : el. 03-5512 2900 : el. a 04-4901667 : Fax T 09000 Kulim No. 485,JalanTunku Asaad KULIM 04-4219912 : Fax T 08000 SungaiPetani Bgn. Telekom, JalanPetani SUNGAI PETANI 04-9667292 : Fax T Jalan PandakMayah6,07000Kuah LANGKAWI 04-9171210 : Fax T 06000 Jitra 19A, JalanPJ1,PekanJitra JITRA 04-7332733 : Fax T 05100 AlorStar Menara AlorStar, LebuhrayaDarulAman ALOR STAR 04-9764688 : Fax T Jalan BukitLagi,01000Kangar KANGAR Kedai Telekom 04-7334770 : Fax T Lebuhraya DarulAman,05100AlorStar 71-72, A&B,PrimatelBusinessCentre TELEKOM MALAYSIA BERHAD Primatel BusinessCentre l 04-4961011 : el. 04-4219191 : el. 04-9667202 : el. 04-9182043 : el. 04-7339191 : el. 04-9762101 : el. 04-720 2143 : el. a 010-4010096 : Fax T 07000 Kuah,Langkawi Bandar BaruKuah No. 17,JalanPandakMayah4 LANGKAWI 04-4233900 : Fax T 08000 SungaiPetani No. 23-0,JalanKampungBaru SUNGAI PETANI 04-7335891 : Fax T 05100 AlorStar Lebuhraya DarulAman Complex AlorStar Lot 170&171,Ground1stFloor ALOR STAR 04-9775900 : Fax T 01000 Kangar T No. 11&13,JalanSenaIndah KANGAR Centre CELCOM Service a 04-2260254 : Fax T 10050 PulauPinang 1st Floor, JalanBurmah TELEKOM MALAYSIA BERHAD Centre Customer Service 04-2273122 : Fax T 10400 PulauPinang 1st Floor, BangunanESK TELEKOM MALAYSIA BERHAD General Manager, StateBusiness Operations PULAU PINANG areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService l 04-9667446 : el. 04-4231900 : el. 04-7303900 : el. 04-977 7900 : el. aman SenaIndah l 04-2269595 : el. 04-2278000 : el. a 04-2288905 : Fax T 10350 PulauPinang No. 245,JalanBurmah Wisma Celcom Ground &1stFloor PULAU PINANG 04-3983131 : Fax T 13700 SeberangJaya,PulauPinang Pusat BandarSunway No. 31,JalanTodak 4 SEBERANG JAYA Centres Service CELCOM 04-5822014 : Fax T 1282, JalanBesar, 14200SungaiBakap SUNGAI BAKAP 04-5399339 : Fax T 14000 BukitMertajam Jalan AmurugamPillai BUKIT MERTAJAM 04-3323399 : Fax T 12000 Butterworth Jalan BaganLuar Wisma Telekom Butterworth BUTTERWORTH 04-2627500 : Fax T Lebuh Downing,10300PulauPinang Bgn. Tuanku SyedPutra LEBOH DOWNING 04-2282929 : Fax T Jalan Burmah,10050PulauPinang JALAN BURMAH 04-6422929 : Fax T Jalan Mahsuri,11950BayanBaru No. 68,GroundFloor BAYAN BARU Kedai Telekom l 04-2288900 : el. 04-3973131 : el. 04-5824444 : el. 04-5399191 : el. 04-3319191 : el. 04-2209321 : el. 04-2209191 : el. 04-642 9292 : el. a 052551717 : Fax T Jalan Dato’OnnJaafar, 30300Ipoh Bangunan Telekom TELEKOM MALAYSIA BERHAD Centre Customer Service 05-2412185 : Fax T Jalan SultanIdrisShah,30672Ipoh Level 2,WismaTelekom TELEKOM MALAYSIA BERHAD General Manager, StateBusinessOperations PERAK areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService a 05-2548111 : Fax T 30672 Ipoh Wisma Telekom, JalanSultanIdrisShah IPOH Kedai Telekom 05-2549696 : Fax T Jalan SultanIdrisShah,30672Ipoh Mezzanine Level,WismaTelekom TELEKOM MALAYSIA BERHAD Primatel BusinessCentre a 04-2818501 : Fax T 11600 Jelutong,PulauPinang No. 354,KLMN,JalanJelutong JELUTONG 04-5303236 : Fax T 14000 BukitMertajam T No. 22,Tingkat CikuI BUKIT MERTAJAM l 05-2499171 : el. 05-2412195/2499121 : el. l 05-2537788 : el. 05-2499192/9189 : el. l 04-2824941 : el. 04-538 0900 : el. aman Ciku a 05-7911701 : Fax T 33300 Gerik Wisma Kosek,JalanTakong Datoh GERIK 05-7161522 : Fax T Jalan RajaChulan,33000KualaKangsar Bangunan Telekom KUALA KANGSAR 05-7169600 : Fax T Pusat Bandar, 34200ParitBuntar 36, PersiaranPerwira P 05-6218453 : Fax T Jalan Jawa,36672Teluk Intan Bangunan Telekom TELUK INTAN 05-8084331 : Fax T 34672 Taiping Bangunan Telekom, JalanBerek T 05-4669393 : Fax T Jalan Baru,31900Kampar Bangunan Telekom KAMPAR 05-5472257 : Fax T 31400 Ipoh Jalan SultanAzlanShahUtara T 05-3662988 : Fax T 31672 BatuGajah No. 26,JalanDewangsa BATU GAJAH l 05-7911191 : el. 05-7769191 : el. 05-7169191 : el. 05-6259221 : el. 05-8085600 : el. 05-4669191 : el. 05-5459191 : el. 05-366 9191 : el. AIPING ASEK ARIT BUNTAR

261 262 services areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService 05-8121900 : Fax T 34600 Kemunting,Taiping Jalan Kemunting,Taman Saujana No. 430,Ground&1stFloor T 05-6232900 : Fax T 36000 Teluk Intan Jalan Sekolah Lot 12,MedanSriIntan TELUK INTAN 05-2548900 : Fax T 30250 Ipoh No. 148,JalanKampar IPOH Centre Service CELCOM 05-4596633 : Fax T Jalan Besar, 35900Tanjung Malim T 05-4013932 : Fax T Jalan Stesyen,35672Tapah Bangunan Telekom TAP 05-6916252 : Fax T 32000 Sitiawan 179, Taman SitiawanMaju SITIAWAN 05-5985519 : Fax T 31000 SungaiSiput No. 188,JalanBesar SUNGAI SIPUT GROUP DIRECTORY l 05-8120900 : el. 05-6233900 : el. 05-2545900 : el. 05-4597210 : el. 05-4019191 : el. 05-6919191 : el. 05-598 9191 : el. AIPING ANJUNG MALIM AH a 06-4414191 : Fax T Jalan Besar, 73000Tampin T 06-4812000 : Fax T Jalan Bahau,72000KualaPilah KUALA PILAH 06-6474200 : Fax T Jalan Pantai,Batu2,71000PortDickson PORT DICKSON 06-7629394 : Fax T Jalan DatoHamzah,70000Seremban SEREMBAN Kedai Telekom 06-7619696 : Fax T Jalan Tuanku Munawir, 70000Seremban Suite 7,WismaArab-Malaysian TELEKOM MALAYSIA BERHAD Primatel BusinessCentre 06-7634444 : Fax T Jalan Dato’Hamzah,70000Seremban TELEKOM MALAYSIA BERHAD Centre Customer Service 06-7677888 : Fax T Jalan Dato’Hamzah,70000Seremban TELEKOM MALAYSIA BERHAD General Manager, StateBusinessOperations NEGERI SEMBILAN l 06-4412191 : el. 06-4811191 : el. 06-6472191 : el. 06-7651085 : el. 06-7651248 : el. 06-7651190 : el. 06-765 1888 : el. AMPIN a 06-6515240 : Fax T 71010 Lukut,PortDickson No. 8,JalanPasar LUKUT 06-7634286 : Fax T Jalan Tun Dr. Ismail,70200Seremban Lot 1521,GroundFloor173 SEREMBAN Centre Service CELCOM a 06-2814445 : Fax T 75320 PeringgitMelaka Jalan BatuHampar Lot F9-F15,BangunanPeringgitPoint TELEKOM MALAYSIA BERHAD Primatel BusinessCentre 06-2828534 : Fax T 75000 Melaka Bangunan Unit2,JalanBandaKaba TELEKOM MALAYSIA BERHAD Centre Customer Service 06-2308220 : Fax T Leboh Ayer Keroh,75450Melaka Level 2,KompleksKotamas TELEKOM MALAYSIA BERHAD General Manager, StateBusinessOperations MELAKA areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService l 06-6515235 : el. 06-763 2548 : el. l 06-2925012 : el. 06-2929292 : el. 06-2522366 : el. a 06-2317677 : Fax T 75450 Ayer Keroh,Melaka Leboh Ayer Keroh Level 2,KompleksKotamas KOTAMAS 06-5565724 : Fax T 78000 AlorGajah,Melaka a 07-3391919 : Fax T T Sutera3 Level 5,WismaTelekom, Jalan TELEKOM MALAYSIA BERHAD General Manager, StateBusiness Operations JOHOR areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService 06-2846900 : Fax T Jalan MunshiAbdullah,75100Melaka No. 165,Ground&MezzanineFloor 06-2811311/2833800 : Fax T 75000 Melaka No. 233,Taman MelakaRaya MELAKA Centre Service CELCOM Batu 14 ALOR GAJAH 06-2811000 : Fax T Jalan GajahBerang,75200Melaka 527 &529A,PlazaMelaka MELAKA Kedai Telekom l 06-2522582 : el. 06-5562292 : el. l 07-2281001 : el. aman Sentosa,80150JohorBahru 06-2836900 : el. 06-2814800 : el. 06-292 5801 : el. 1 ⁄ 2 , JalanMelakaKendong Bt. 9 Ground Floor, IbusawatTelekom SKUDAI 07-2227171 : Fax T Jalan AbdullahIbrahim,80672JohorBahru JOHOR BAHRU Kedai Telekom 1800889696 : Fax T T Wisma Telekom Pelangi,JalanSutera3 TELEKOM MALAYSIA BERHAD Primatel BusinessCentre 1800889393 : Fax T 81400 Senai 4th Floor, IbusawatTelekom Senai TELEKOM MALAYSIA BERHAD Centre Customer Service a 07-4314888 : Fax T 40 &42,JalanRahmat,83000Batu Pahat BATU PAHAT 07-9325717 : Fax T Jalan Pawang,85000Segamat SEGAMAT 07-7729111 : Fax T Jalan Sultanah,86000Kluang KLUANG 07-6873800 : Fax T Jalan Alsagoff,82000Pontian 1st Floor, IbusawatTelekom PONTIAN 07-5571999 : Fax T l 07-2281128 : el. 1800889595 : el. aman Sentosa,80150JohorBahru 1050 : el. l 07-4359292 : el. 07-9333235 : el. 07-7719191 : el. 07-6879191 : el. 07-2221167 : el. 1 ⁄ 2 Jalan Skudai,81300Skudai a 07-2514999 : Fax T 81700 PasirGudang 17 &19,Jalan9/7,Perjiranan9 P 07-4673888 : Fax T Jalan Muar, 83700Yong Peng YONG PENG 07-7995000 : Fax T Jalan DatoTimur, 86800Mersing MERSING 07-3319999 : Fax T T Pelangi BusinessCentre,JalanKasa PELANGI 07-6635800 : Fax T 81100 Kulai T Lot 435,JalanKenanga29/11 KULAI 07-8834999 : Fax T 81900 KotaTinggi No. 2-4,JalanIndah,Taman MedanIndah KOTA TINGGI 06-9515916 : Fax T 37A JalanIbrahim,84000Muar MUAR a 07-3876268 : Fax T 81750 Masai,Johor Bandar BaruPermasJaya No. 6,JalanPermas10/7 PERMAS JAYA Centres Service CELCOM l 07-2519191 : el. 07-6471466 : el. 07-7995291 : el. 07-2281151 : el. aman Sentosa,80150JohorBahru 07-6639191 : el. aman IndahPutra O7-883 5199 : el. 06-952 9595 : el. l 07-3878662 : el. ASIR GUDANG

263 264 a 09-5136644 : Fax T Jalan Mahkota,25000Kuantan Level 2,WismaTelekom Mahkota TELEKOM MALAYSIA BERHAD General Manager, StateBusiness Operations P areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService 07-4326900 : Fax T T No. 23,JalanKundang 07-4335277 : Fax T 83000 BatuPahat No. 22,JalanMaju,Taman Maju BATU PAHAT 07-9328901 : Fax T Jalan Genuang,85000Segamat No. 246,Ground&MezzanineFloor SEGAMAT 07-3533015 : Fax T 81100 JohorBahru 1-3, JalanMolek1/9,Taman Molek T 07-3353200 : Fax T T No. 1,JalanKuning2 T 07-2101907 : Fax T T Bangunan Ang,No.1,JalanJeram Lot G-1,Ground&MezzanineFloor JOHOR BAHRU GROUP DIRECTORY l 09-5129353 : el. 07-4325900 : el. aman BukitPasir, 83000BatuPahat 07-4338677 : el. 07-9323900 : el. 07-3539900 : el. 07-3353199 : el. aman Pelangi,80400JohorBahru 07-210 1900 : el. aman Tasek, 80200JohorBahru AMAN MOLEK AMAN PELANGI AHANG a 09-5592919 : Fax T 25200 Kuantan Seksyen 19,JalanHj.Abd.Aziz 1st Floor, Lot185&186 CELCOM WISMADELIMA 09-5158686 : Fax T 45, JalanTanah Putih,25100Kuantan KUANTAN Centre Service CELCOM 09-3555191 : Fax T Jalan KualaLipis,27600Raub RAUB 09-3555191 : Fax T 10, JalanBukitBius,27200KualaLipis KUALA LIPIS 09-2228050 : Fax T Jalan AhPeng,28700Bentong 111, Bgn.PersatuanBolaSepak BENTONG 09-2772191 : Fax T Jalan Tun Razak,28400Mentakab MENTAKAB 09-5139289 : Fax T 25000 Kuantan No. 168,JalanBesar Bangunan Telekom Malaysia KUANTAN Kedai Telekom 09-5145151 : Fax T Jalan Mahkota,25000Kuantan 4th Floor, BangunanTelekom TELEKOM MALAYSIA BERHAD Centre Customer Service l 09-5593939 : el. 09-5121088 : el. 09-3553191 : el. 09-3122191 : el. 09-2227978 : el. 09-2701164 : el. 09-5142088 : el. 09-515 2292 : el. a 09-2961485 : Fax T 28000 Temerloh No. 62,JalanAhmadShahI TEMERLOH a 09-6242727 : Fax T 20200 KualaTerengganu Jalan SultanIsmail 4th Floor, BangunanTelekom TELEKOM MALAYSIA BERHAD General Manager, StateBusinessOperations TERENGGANU areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService a 09-8444111 : Fax T Jalan Nibong,23000Dungun DUNGUN 09-8592411 : Fax T Jalan Masjid,24000Kemaman KEMAMAN 09-6245200 : Fax T 20200 KualaTerengganu Bangunan Telekom, JalanSultanIsmail KUALA TERENGGANU Kedai Telekom 09-6244628 : Fax T 20710 KualaTerengganu Jalan SultanMuhamad Ibusawat Telekom Hiliran TELEKOM MALAYSIA BERHAD Centre Customer Service l 09-296 2900 : el. l 09-6202525 : el. l 09-8455354 : el. 09-8593191 : el. 09-6232191 : el. 09-6209292 : el. a 09-7431568 : Fax T Jalan Doktor, 15000KotaBharu T Bhg. PusatPerkhidmatanPelanggan 3rd Floor, BangunanUnit1 TELEKOM MALAYSIA BERHAD Centre Customer Service 09-7443447 : Fax T Jalan Doktor, 15000KotaBharu 1st Floor, BangunanPentadbiran TELEKOM MALAYSIA BERHAD General Manager, StateBusiness Operations KELANTAN areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService 010-9031904 : Faks T 24000 Chukai,Kemaman T Lot K9709-9710 KEMAMAN 09-6230800 : Fax T 20000 KualaTerengganu Jalan Dato’Isaacs No. 42,WismaIsaacs Ground &MezzanineFloor 09-6224591 : Fax T 20300 KualaTerengganu No. 6C&6D,JalanAirJernih KUALA TERENGGANU Centre Service CELCOM 09-6973291 : Fax T Jalan ZainalAbidin,22000Jertih Upper Floor, IbusawatTelekom Jertih JERTIH l 09-7449292Ext.421 : el. elekom MalaysiaBerhad 09-7434545 : el. 09-8591906 : el. aman ChukaiUtama 09-6226800 : el. 09-6233900 : el. 09-697 9191 : el. a 09-9554904 : Fax T 17500 Tanah Merah Jalan Taman Hiburan Bangunan MerdekaJaya T 09-7351001 : Fax T 15300 KotaBharu Seksyen 27,JalanSeriCemerlang Lot 825&826 KOTA BHARU Centre Service CELCOM 09-7867313 : Fax T 16800 PasirPuteh 258B, JalanSekolahLaki-Laki P 09-9663228 : Fax T 18000 KualaKrai Lot 1522,JalanTengku ZainalAbidin KUALA KRAI 09-9557431 : Fax T 17500 Tanah Merah 4088, JalanIsmailPetra T 09-7900427 : Fax T 17000 PasirMas 606, JalanMasjidLama P 09-7430778 : Fax T Jalan Doktor, 15000KotaBharu KOTA BHARU Kedai Telekom services areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService l 09-9554900 : el. 09-7351000 : el. 09-7867191 : el. 09-9666191 : el. 09-9556191 : el. 09-7909191 : el. 09-744 9191 : el. ANAH MERAH ANAH MERAH ASIR PUTEH ASIR MAS a 088-299716 : Fax T 88672 KotaKinabalu Jalan Tunku AbdulRahman Ground Floor, Telekom Malaysia TELEKOM MALAYSIA BERHAD Centre Customer Service 088-248378 : Fax T 88672 KotaKinabalu Jalan Tunku AbdulRahman TELEKOM MALAYSIA BERHAD General Manager, StateBusinessOperations S a 089-888 500 : Fax T 91100 LahadDatu Kompleks Fajar, JalanSegama MOLD 3307,GroundFloor LAHAD DATU 089-761600 : Fax T Jalan Perbandaran,91000Tawau T TAWAU 088-232311 : Fax T 88100 KotaKinabalu L. TERBANGK.KINABALU 088-257979 : Fax T 88100 SadongJaya 3rd Floor, BangunanTelekom SADONG JAYA Kedai Telekom 088-269696 : Fax T 88100 KotaKinabalu,Sabah Jalan IkanJuara1,SadongJayaComplex 1st Floor, Lot67-69,BlockJ TELEKOM MALAYSIA BERHAD Primatel BusinessCentre .B. 307,Block35,KompleksFajar l 088-299714 : el. 088-299 888/838 : el. l 089-881160 : el. 089-773131 : el. 088-261261 : el. 088-299380 : el. 088-269595 : el. ABAH

265 266 P. Ribumi Shophouses Ground-2nd Floor Lot 21,BlockC11 KENINGAU 089-217900 : Fax T 90000 Sandakan Block B,Phase2,Taman GrandView Lot 9&10,GroundMezzanineFloor SANDAKAN 088-282805 : Fax T 88300 KotaKinabalu Damai PlazaPhase3,Luyang Wisma CTF, Lot4,BlockB DAMAI Centres Service CELCOM P. Jalan Wak Siak KUDAT 087-211411 : Fax T 89800 Beaufort Choong Street,P.O Box269 BEAUFORT 087-335000 : Fax T Lot 13&14,89007Keningau Off JalanMasak,BlokB7 Commercial Centre,JalanArusap KENINGAU 089-216000 : Fax T Locked Bag44,90009Sandakan SANDAKAN GROUP DIRECTORY a 087-334900 : Fax T 088-612690 : Fax T l 089-215900 : el. 088-282802 : el. 087-212292 : el. 087-333496 : el. 089-219 191 : el. l 087-333900 : el. 088-611022 : el.

O. Box900,89008Keningau O. Box340,89058Kudat a 085-433301 : Fax T 98000 Miri Bintang JayaCommercial Complex Ground Floor, Lot1076, 1077 TELEKOM MALAYSIA BERHAD 082-250686 : Fax T Jalan BatuLintang,93200Kuching Ground Floor, BangunanTelekom TELEKOM MALAYSIA BERHAD Primatel BusinessCentre 082-257505 : Fax T Jalan SimpangTiga, 93672Kuching 6th Floor, TM100 TELEKOM MALAYSIA BERHAD General Manager, StateBusinessOperations S areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService a 089-752457 : Fax T Fajar Complex,91000Tawau Block 36,JalanPatrick TB 309,Ground-3rdFloor TAWAU 088-212895 : Fax T Level 2,KKIA,88200KotaKinabalu 088-247900 : Fax T 88992 KotaKinabalu Asia City, LockedBagNo.29 Lorong SinggahMata,MPKK1 Ground-3rd Floor, Lot1,BlockB KOTA KINABALU l 085-432223/410041 : el. 082-203900/901/904 : el. 082-200200 : el. l 089-752458 : el. 088-212870 : el. 010-801 0029 : el. AR AWAK a 084-796 515 : Fax T Jalan KapitByPass,96800 KAPIT 084-653588 : Fax T Jalan Berek,96100Sarikei SARIKEI 084-314708 : Fax T Persiaran Brooke,96000Sibu SIBU 086-333222 : Fax T Jalan LawGekSoon,97000Bintulu BINTULU 085-285399 : Fax T Jalan Punang,98850Lawas LAWAS 085-212798 : Fax T Jalan Kubu,98700Limbang LIMBANG 085-422400 : Fax T Jalan Post,98000Miri MIRI 083-321490 : Fax T Jalan Club,95000SriAman SRI AMAN 082-337797 : Fax T Jalan Gedong,93450Pending PENDING 082-243511 : Fax T Jalan BatuLintang,93200Kuching BATU LINTANG Kedai Telekom l 084-796991 : el. 084-655550 : el. 084-339191 : el. 086-318181 : el. 085-285667 : el. 085-211334 : el. 085-429191 : el. 083-322125 : el. 082-489191 : el. 082-429 191 : el. a 084-310800 : Fax T 96000 Sibu Jalan KampungNyabor Lot 145,Ground&1stFloor SIBU 086-338372 : Fax T 97000 Bintulu Lot 427,No.9,JalanAbangGalau 086-314800 : Fax T Jalan Tun HusseinOnn, 97000Bintulu Medan JayaCommercial Centre Lot 3637,1stFloor, Block31 BINTULU 010-8467703 : Fax T 93450 Kuching Jalan DatoAbangAbdulRahim Sub Lot6,Seksyen45 Ground Floor, Lot445 DAARSVCCTR JALAN 082-259800 : Fax T 93400 Kuching Ground &1stFloor, Lot314,JalanSatok KUCHING (SATOK) 082-252900 : Fax T Jalan Satok,93400Kuching Lot 609,Block195 Wisma LimKimSoon KUCHING (CENTRALPARK) 082-419084 : Fax T 93150 Kuching 3rd Mile,JlnTun AhmadZaidiAdruce Central ParkCommercial Centre No. 322,Lot2734 CENTRAL PARK Centres Service CELCOM l 084-321800/324800 : el. 086-338900 : el. 086-338423 : el. 082-339900 : el. 082-239800 : el. 082-410506 : el. 082-203 888 : el. a 087-441446 : Fax T Jalan Merdeka,87000WPLabuan Labuan FinancialPark Lot E001,1stFloor, PodiumLevel TELEKOM MALAYSIA BERHAD Primatel BusinessCentre 087-453899 : Fax T Jalan Merdeka,87000WPLabuan Labuan FinancialPark Lot E001,1stFloor, PodiumLevel State RelationsOfficer PERSEKUTUAN LABUAN WILAYAH areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService a 087-415013/425900 : Fax T 87008 WilayahPersekutuanLabuan Jalan Tun Mustapha,WilayahPersekutuan Lot 8,LazendaCommercial Centre LABUAN SERVICECENTRE Kedai Telekom a 085-439445 : Fax T 98000 Miri Block 9,MCLDJalanAsmara Lot 935,Ground&1stFloor MIRI 084-330823 : Fax T Off JalanTuanku Osman,96000Sibu No. 44,Lot1557,JalanKeranji l 087-408878 : el. 087-408888 : el. l 087-425300/100/400 : el. l 085-420800/429236 : el. 084-322 900 : el. services areavailableatKedaiTelekom.services Internet registrationandbillpayment Centre TM NetService 087-416790 : Fax T 87007, WilayahPersekutuanLabuan Lot 6,JalanAnggerik Ground-2nd Floor LABUAN Centre Service CELCOM a +224-411535 : Fax T B P2066,Conakry, RepublicofGuinea SOTELGUI s.a. +66-2-5026072 : Fax T Nonthaburi, 11120Thailand Klong Gluar, Pak-Kred Chaengwattana Rd. 92, MooSoftwarePark SAMART CORPORATION PLC +94-1-678703 : Fax T Colombo 2SriLanka No. 475,UnionPlace MTN NETWORKS(PVT.) LTD. +855-16-810006 : Fax T Kingdom ofCambodia Khan DounPenh,PhnomPenh No. 3,SamdechSothearosBlvd. 33rd Floor CO. LTD. CAMBODIA SAMART COMMUNICATIONS AFFILIATES SUBSIDIARIES/ INTERNATIONAL l 087-416 900 : el. l +224-450200 : el. +66-2-5026070 : el. +94-1-678688 : el. +855-16-810081 : el.

267 268 a 03-20342609 : Fax T 50250 KualaLumpur Jalan Punchak,OffP. Ramlee MENARA KUALALUMPURSDN.BHD. 03-22843464 : Fax T 59200 KualaLumpur PantaiBaharu Plaza Pantai,Jalan Level 14,WismaPantai MEGANET COMMUNICATIONS SDN.BHD. 03-22400709 : Fax T Jalan PantaiBaharu,50672KualaLumpur 31st Floor, MenaraTelekom GITN SDN.BHD. 03-79809900 : Fax T 58100 KualaLumpur Pusat BandarTaman Desa Jalan DesaUtama 7th Floor, WismaTelekom FIBERAIL SDN.BHD. L +880-2-9887112 : Fax T Dhaka 1212,Bangladesh 75 MohakhaliCommercial Area 9th Floor, BracCentre LIMITED TM INTERNATIONAL BANGLADESH +37-12-3118302 : Fax T Pretoria 0001,SouthArica Private Bag8780 TELKOM SALIMITED +265-1-642805 : Fax T Limbe P.O. Box3039,Blantyre,Malawi Munif House,LivingstoneAvenue TELEKOM NETWORKSMALAWI LIMITED GROUP DIRECTORY l 03-20205446 : el. 03-22845515 : el. 03-22400708 : el. 03-79809696 : el. +880-2-9887115 : el. +27-12-3113910 : el. +265-1-645915 : el. OCAL SUBSIDIARIES a 03-26812680 : Fax T 50300 KualaLumpur No. 82,JalanRajaMudaAbdulAziz Level 3,MenaraCELCOM TELEKOM TECHNOLOGYSDN.BHD. 03-20934993 : Fax T 50490 KualaLumpur Jalan MedanSetia1,BukitDamansara 45-8, Level3,BlockC,PlazaDamansara TELEKOM SMART SCHOOLSDN.BHD. 03-22826184 : Fax T 59100 Bangsar, KualaLumpur Jalan LikuOffRiong Menara MutiaraBangsar TELEKOM SALES&SERVICESSDN.BHD. 03-89451591 : Fax T Lebuh Silokon,43400Serdang,Selangor T Idea Tower, UPM-MTDC SDN. BHD. TELEKOM RESEARCH&DEVELOPMENT 03-42919191 : Fax T 55100 KualaLumpur Jalan PandanUtama,Indah 10th Floor, MenaraD,PersiaranMPAJ TELEKOM PUBLICATIONS SDN.BHD. 03-79801605 : Fax T KlangLama,KualaLumpur Off Jalan Jalan DesaBahagia,Taman Desa 16th Floor, Menara2,FaberTowers TELEKOM APPLIEDBUSINESSSDN.BHD. 03-83125022 : Fax T Selangor DarulEhsan Jalan Multimedia,63100Cyberjaya UNIVERSITY TELEKOMSDN.BHD. l 03-26812681 : el. 03-20925252 : el. 03-22833888 : el. 03-89331820 : el. echnology IncubationCentre1 03-42921111 : el. 03-79844989 : el. 03-8312 5000/5020 : el. a 03-77282584 : Fax T 60000 KualaLumpur T No. 1,JalanTun MohdFuad 8th Floor, PlazaIBM V 03-83188077 : Fax T 63300 Cyberjaya,SelangorDarulEhsan 3300, LingkaranUsahawan1Timur TM NETSDN.BHD. 03-79560266 : Fax T Jalan PantaiBaharu,50672KualaLumpur 17th Floor, MenaraTelekom TM INTERNATIONAL SDN.BHD. 03-22841233 : Fax T Jalan PantaiBaharu,50672KualaLumpur 27th Floor, MenaraTelekom TM FACILITIES SDN.BHD. 03-26810359 : Fax T 50300 KualaLumpur No. 82,JalanRajaMudaAbdulAziz 15th Floor, MenaraCELCOM CELCOM (M)BERHAD l 03-77128888 : el. aman Tun Dr. Ismail 03-83188027 : el. 03-22402254 : el. 03-22401004 : el. 03-2687 3838 : el. ADS BERHAD PROXY FORM TELEKOM MALAYSIA BERHAD Annual Report 2003

I/We ______(Full Name and NRIC/Passport No./Company No.) of ______being a Member/Members of TELEKOM MALAYSIA BERHAD hereby appoint ______(Full Name and NRIC/Passport No.) ______of ______or failing him ______(Full Name and NRIC/Passport No.) of ______or failing him, the Chairman of the Meeting, as my/our proxy to vote for me/us and my/our behalf at the Nineteenth Annual General Meeting of the Company to be held at the Grand Ballroom, 9th Floor, The Legend Hotel, 100 Jalan Putra, 50350 Kuala Lumpur on Tuesday, 18 May 2004 at 10:00 a.m. and at any adjournment thereof. My/Our proxy is to vote as indicated below:- Resolutions For Against 1. To receive the Audited Financial Statements for the financial year ended 31 December 2003 – Ordinary Resolution 1 2. Declaration of a final dividend of 10 sen per share (less 28% Malaysian Income Tax) and special dividend of 10 sen per share (less 28% Malaysian Income Tax) – Ordinary Resolution 2 3. Re-election of Directors under Article 103:- (i) Tan Sri Dato’ Ir. Muhammad Radzi bin Haji Mansor – Ordinary Resolution 3 (ii) Ir. Prabahar N.K. Singam – Ordinary Resolution 4 (iii) Dato’ Lim Kheng Guan – Ordinary Resolution 5 (iv) Rosli bin Man – Ordinary Resolution 6 (v) Tan Poh Keat – Ordinary Resolution 7 (vi) Datuk Dr. Halim bin Shafie – Ordinary Resolution 8 (vii) Dato’ Abdul Majid bin Haji Hussein – Ordinary Resolution 9 4. Approval of Directors’ fees and remuneration – Ordinary Resolution 10 5. Re-appointment of Messrs. PricewaterhouseCoopers as Auditors of the Company – Ordinary Resolution 11 6. Special Business: – Section 132D, Companies Act 1965 – Ordinary Resolution 12 Issuance of New Shares

(Please indicate with an “X” in the spaces provided how you wish your vote to be cast. If you do not do so, the Proxy will vote or abstain from voting at his/her discretion.)

No. of Shares CDS Account No. Signed this ______day of ______2004

✂ ______Signature/Common Seal of Appointer Notes: 1. A member entitled to attend and vote at the above Meeting is entitled to appoint a proxy to attend and vote in his stead. A Proxy need not be a member of the Company and the provisions of Section 149(1)(b) of the Act shall not apply to the Company. 2. A member shall not be entitled to appoint more than two (2) proxies to attend and vote at the same meeting provided that where a member of the Company is an authorised nominee as defined in accordance with the provisions of the Securities Industry (Central Depositories) Act, 1991, it may appoint at least one (1) proxy in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account. 3. Where a member appoints two (2) proxies, the appointments shall be invalid unless the proportion of the holding to be represented by each proxy is specified. 4. This instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly appointed under a power of attorney or if such appointee is a corporation, either under its common seal or under the hand of an officer or attorney duly appointed under a power of attorney. 5. A corporation which is a member, may by resolution of its Directors or other governing body authorise such person as it thinks fit to act as its representative at the Meeting, in accordance with Article 92 of the Company’s Articles of Association. 6. This instrument appointing the proxy must be deposited at the office of the Share Registrar, Tenaga Koperat Sdn. Bhd., 20th Floor, Plaza Permata (formerly known as IGB Plaza), Jalan Kampar, Off Jalan Tun Razak, 50400 Kuala Lumpur not less than 48 hours before the time appointed for holding the Meeting or any adjournment thereof.

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The Share Registrar TENAGA KOPERAT SDN. BHD. 20th Floor, Plaza Permata (formerly known as IGB Plaza) Jalan Kampar, Off Jalan Tun Razak 50400 Kuala Lumpur

3. Fold here TELEKOM MALAYSIA BERHAD (128740-P) Laporan Tahunan 2003 Annual Report

New Possibilities...

Enriching Lives

To / Kepada :Tenaga Koperat Sdn. Bhd. Date : Share Registrar / Pendaftar Syarikat Tarikh :

Please send me/us a copy of the 2003 Annual Report in Bahasa Malaysia : Sila hantar kepada saya/kami senaskhah Laporan Tahunan 2003 dalam Bahasa Malaysia :

Name / Nama :

Address / Alamat :

Signature of Shareholder / Tandatangan Pemegang Saham : 1. Fold here/Lipat di sini

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TENAGA KOPERAT SDN. BHD. 20th Floor, Plaza Permata (formerly known as /Dahulu dikenali sebagai IGB Plaza) Jalan Kampar, Off Jalan Tun Razak 50400 Kuala Lumpur

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