Cover Concept

COVER CONCEPT The dandelion’s sheer existence symbolizes life and an inspiring continuum of growth and resurgence. The faintest of breeze stimulates new beginnings for the vibrant plant, dispersing hope and vitality. At Wateen Telecom, we aspire to to flourish in the diverse world of communication. Like the dandelion, our roots are strong; our approach dynamic. It manifests our resolve to continuously revamp ourselves in line with our clients’ needs, redefining the fast-paced innovative era of communication technologies. CONTENTS Vision, Mission & Values ..........................................................................02 Awards and Achievements ......................................................................03 Message from the CEO ...........................................................................04 Board of Directors ...................................................................................06 Financial Highlights ..................................................................................08 Corporate Information ..............................................................................10 Directors’ Report .....................................................................................11 Attendance of the Board Members ..........................................................21 Statement of Compliance with the Code of Corporate Governance .........28 Auditors’ Review Report to the Members ................................................30 Auditors’ Report to the Members .............................................................31 Financial Statements Statement of Financial Position ................................................................34 Income Statement ...................................................................................36 Statement of Comprehensive Income ......................................................37 Statement of Cash Flows .........................................................................38 Statement of Changes in Equity ...............................................................40 Notes to and forming part of the Financial Statements .............................41 Consolidated Financial Statements Auditors’ Report to the Members .............................................................83 Consolidated Statement of Financial Position ..........................................84 Consolidated Income Statement ..............................................................86 Consolidated Statement of Comprehensive Income.................................87 Consolidated Statement of Cash Flows ...................................................88 Consolidated Statement of Changes in Equity .........................................90 Notes to and forming part of the Consolidated Financial Statements .......91 Annexures Pattern of Shareholding .........................................................................134 Categories of Shareholding ....................................................................137 Notice of Annual General Meeting ..........................................................141 Form of Proxy ........................................................................................143 WATEEN TELECOM LTD 01 VISION, MISSION & VALUES Vision Mission Values Enable and empower every man, A winning team that delivers • Serve & Enable the world woman and child in Pakistan through outstanding customer value through around us leading edge technology and services world class ICT solutions, systems • Passion, Energy & Fun thereby transforming their lives. and innovation. • Teamwork & Respect • Ownership & Accountability of Results and Company • Innovation & Creativity 02 ANNUAL REPORT 2013 AWARDS & ACHIEVEMENTS 2012-13 Customer Service Excellence Award Cisco Cloud and Managed Services Advanced Certification Cisco WATEEN TELECOM LTD 03 MESSAGE FROM THE CEO our infrastructure for upgrading carrier networks for 3G readiness. International operators in neighboring countries are also our major customers for additional bandwidth sales. We have also become one of the prominent Long Distance International (LDI) businesses for outgoing calls in Pakistan. All five CMOs utilize Wateen’s network to route their international outgoing calling traffic through our network. Healthy cash inflows are also being generated from our portion in ICH traffic, being terminated in Pakistan. Consumer Business Unit: This unit looks after the complete Consumer Business Portfolio, including servicing WiMAX customers in 19 cities as FY2013 has been an eventful year make it more responsive with distinct well as triple play and cable services at Wateen. We made significant mandates. The following lines of in Lahore and Multan. Much of the progress in bringing focus to the business will have a clear focus and efforts of the team were focused on carrier and enterprise markets in will better serve the evolving needs of restructuring the WiMAX business Pakistan and also reduced our our organization: model and operations to reduce the losses in the consumer segment. We ongoing cash-burn and bring it closer maintained our revenue stream and Enterprise Business Unit: This to breakeven levels. The commercial improved it where possible through unit caters to the needs of our team introduced a unique, first of its materializing strategic initiatives, enterprise customers pertaining to kind business model, transforming the rationalizing our cost structure and the banking, media, financial services, inherited individual based structure improving organizational alignment government, education and other to a more organized and systematic to rebuild Wateen as the most sectors requiring communication approach. Systems were built and dominant telecom infrastructure and cloud based services. Since the enhanced around the business model player in the market. The result has unfortunate fire incident in February to offer comprehensive reporting been a significant improvement in 2012 we have added over 900 new and monitoring mechanisms, our operating performance, with fiber connections to our portfolio saving costs and improving ARPUs operating earnings becoming positive indicating the confidence this to regenerate lost revenues. The for the first time since 2010. Despite a segment has reposed on our offering. consumer business team must tough economic environment, Wateen We redefined enterprise service be applauded for their efforts in posted an increase in revenues by parameters with a special focus on pushing for innovations resulting in 20% and operating earnings with better serving the needs of enterprise improvement of network performance EBITDA gaining PKR 2,823 million customers. This, we enabled and cost savings, regaining partners over the last year, ending at PKR through successful development (formerly franchises) and stakeholders 828 million. Substantial progress and deployment of technology to confidence. We also engaged in in the year was achieved in terms assist with enterprise level customer discussions with other broadband of enhancing our footprint in the care and billing system to enhance operators to consolidate the WiMAX enterprise fiber space, bringing most organizational responsiveness. business to create a critical mass that of our Higher Education Commission will make the business profitable. fiber commitments to closure and Carrier Business Unit: The Carrier improving performance in our Business Unit has been mandated To better understand the consumer fiber and WiMAX space. to provide infrastructural support environment, challenges, resulting We are on the right path to enable services to telecommunication decisions and achievements, let’s ourselves with an environment of and public sector clients. We are take a quick glance at the year optimism, conducive for moving moving towards becoming the behind us: forward with a greater momentum in dominant fiber player in the country the year ahead. and strengthening our position as • Wateen has emerged as the ‘Carriers’ Carrier’. Industry a dominant fiber player in Internally, we have re-aligned our leading Cellular Mobile Operators the industry, leading the organization by Business Units to (CMOs) continued their trust on telecommunication evolution in 04 ANNUAL REPORT 2013 the country. More recently, Zong managed to reduce the impact Delisting process was thereby (China Mobile Pakistan), one of through improved customer initiated and subsequently on January Wateen’s leading customers in retention and revenue per 7, 2014 the Company informed the the carrier market, reaffirmed its subscriber in operational areas. stock exchanges that as of December confidence by signing a long- Concurrently, we have continued 26, 2013, the majority shareholders term strategic fiber lease contract progressing on talks with third had bought 215.41 million shares to enabling their network for the parties over consolidating the during the offer period: thus, raising next 23 years. This reaffirmation WiMAX business. its shareholding to 88.86% of the of their commitment shows their total ordinary shares issued and the trust in delivery of our world class • Following our vision of ‘enabling stock exchanges were requested to services. every man, woman and child in delist the shares of the company from the country through leading edge respective stock exchanges. The • Efforts in improving technology’, Wateen successfully stock exchanges have accepted the responsiveness and customer delivered three milestones request

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