Mtn Nigeria Communications Plc · NSENG:MTNN

Mtn Nigeria Communications — Investor Day (April 2018)

105 slides from Mtn Nigeria Communications's investor day presentation, April 2018

1. Slide 1: MTN Nigeria Investor Day Presentation

   MTN Nigeria Invesfor Day Presentation

2. Slide 2: Disclaimer

   Disclaimer = This presentation has been prepared by MTN Group Limited ("MTN") and MTN Nigeria Communications Limited or a successor entity (the “Company”, and together with its direct and indirect subsidiaries, the "Group”) fo provide an overview of the Group. “Presentation” means this document, its

3. Slide 3: Disclaimer (continued)

   Disclaimer | continued br) The presentation includes market share and industry data obtained by MTN and the Company from industry publications and surveys and internal surveys. MTN and the Company may not have access to the facts and assumptions underlying the numerical data, market data and other i

4. Slide 4: Agenda

   Time Agenda 09:00-09:30 Welcome and introduction 09:30-09:45 Nigerian macro and political environment 09:45-10:45 MTN Nigeria is well-positioned to capture growth 10:45-11.00 Tea break 11:00-11:30 Commercial overview 11:30-12:00 Focus on digital and MFS 12:00-12:15 B2B offering 12:15-13:15 Lunch 13:

5. Slide 5: Ralph Mupita

   Ralph Mupita (MTN Group CFO) — - mes = 4 os 7 4 ‘ : é oO ae wo) A « ° * 2 » = » © a 4

6. Slide 6: MTN Group at a glance

   MTN Group at a glance Leading emerging markets operator with 217 million active data users 22 million active mobile money customers Notes: Numbers as at 31 December 2017. #1/#2 position in countries across Africa & the Middle-East #Largest market share in countries Broad range of * Digital ° Enterpr

7. Slide 7: Group medium-term targets

   Group medium-term targets Service ES ; revenue Group Improving growth* = poe 1 = () | EBITDA South Africa | Nigeria | H mid single digit | double digit | ma rgi ns growth | growth | bd O Capex intensity between Holdco leverage = Holdco net debt / SA EBITDA + cash upstreaming. Adjusted holdco leverag

8. Slide 8: MTN Nigeria (MTNN)

   MTN Nigeria (“MTNN”) Largest commercially owned mobile operator 52.3 57% e e million market share by revenue) #1 player ==; Nationwide coverage & LTE #2 MTN OpCo leadership; presentin cities & Fowns in Nigeria Strong managemenf with mix of local & international expertise XS, y Hl =, active data user

9. Slide 9: Nigeria's contribution to Group's KPIs for 2017

   Nigeria's contribution to Group's KPI's for 2017 Subscribers Subscribers Nigeria (24%) Capital allocation Capex Source: Company data. Note: (1) Defined os EBITDA - Capex. Active data users Nigeria 69 million Nigeria (28%) Revenue drivers Voice revenue Nigeria (34%) Profitability EBITDA — Nigeria (30

10. Slide 10: MTN Group's view of Nigeria's investment case

    MTN Group's view of Nigeria's investment case br) Strong Exciting position in attractive demographic market opportunity ¢ Largest African economy * Expected population growth of c.5m p.a. until 2022) ¢ With c.145m subs, the largest African telco market ‘) ¢46m+ new market subscribers expected by 202

11. Slide 11: Today's speakers

    Today's speakers én 9 be \ MTN Nigeria CEO MTN Nigeria CFO Executive, Corporate Relations Chief Marketing Officer Chief Enterprise Business Officer Chief Technical Officer * Appointed in 2015 * Formerly CFO of MTN Nigeria * Former CFO and COO, of MTN Irancell * Joined the company in 2003 * Previousl

12. Slide 12: Nigerian macro and political environment

    Nigerian macro and political environment Ferdi Moolman (MTN Nigeria CEO)

13. Slide 13: Nigeria macro rebound since Q2 2017 led by non-oil

    Nigeria macro rebound since Q2 2017 led by non-oil SE ET TE > fill oi! © Nein GBP recovering after recession caused by slobel oilers us$/ Barrel i a 120, ETM GDP in USD” (RHS) Oil Price 90 Oil Price (LHS) 60 Oil Price (LHSY2 Sescete 30 LTM GDP in USD (RHS) Source: EIU, FactSet \FX Reserves US$ FX NG

14. Slide 14: Expectation of growth driven by non-oil sectors

    Expectation of growth driven by non-oil sectors barn * GDP is expected to grow driven by (DP growth expected tobe ven by nomilsectors nonroll sectors: Pena, Com ¢ ¢ “32.0% >) Us$ bn ~ Agriculture growth as boosting food production is a 68 ~ key government objective 64 L Oil Price (LHS? a ; a . waren

15. Slide 15: Current political environment

    Current political environment + President Muhammadu Buhari along with the All Progressive Congress (APC) party elected in 2015 * The elections were widely praised as free, fair and without incident setting a precedent for future elections in Nigeria and on the continent + The government has leverage

16. Slide 16: MTN Nigeria is well-positioned to capture growth

    MTN Nigeria is well-positioned fo capture growth Ferdi Moolman (MTN Nigeria CEO)

17. Slide 17: Nigeria market comparison charts

        395 344 336 176 111 Nigeria South Africa Egypt Algeria Morocco China India USA Indonesia Brazil Pakistan Nigeria Ehiopia SA (3)     Nigeria Egypt South Africa Ethiopia Algeria Nigeria Africa Average WE Average Global

18. Slide 18: Strong position in attractive market: clear market leader

    Strong position in attractive markef | TN Nigeria is the clear market leader br) Leader in the Nigerian telecoms market with a strong competitive advantage across all segments. (Subscribers Market Share in 2017) (Value Share in 2017) psx & 13% g * Significantly understated market share of MTNN by su

19. Slide 19: Key KPIs

    Key KPIs: (As of 2Q17) Commentary            ₦

20. Slide 20: Market growth CAGR

    • (2) • 12A-16A CAGR 17E-22E CAGR

21. Slide 21: Exciting demographic opportunity: rural expansion

    Exciting demograph ic opportunity | penetration growth driven by rural expansion br) .. Rural areas are currently significantly underpenetrated by mobile voice and data access, which creates significant opportunities for growth Despite most of the Nigerian population living in rural areas... Total P

22. Slide 22: Nigeria vs South Africa vs Western Europe

    Nigeria South Africa Western Europe Nigeria South Africa WE

23. Slide 23: Expected data usage and revenue growth

    Exciting demographic opportunity | expected data usage and revenue growth Data Usage per User Data Revenue Contribution (MB per Month) (3G/4G) CAGR 2017A-— 20226: +24% Bm 1,969 p 1,184 ae 47% 48% _ 1 , j 1 511 ! ! 1 ‘ 100 | I 11% I ' | ! 1 a t ! O 6 Coy 7) e @ Nigeria South Africa Nigeria(2022€) Nig

24. Slide 24: MFS and digital opportunity

    Exciting demographic opportunity | Mrs and digital presents a key opportunity br) Low Penetration of Banking Services Strong growth potential of MFS / Digital content and services 96.4m Addressable Market (Adult Population) 49°5 Unbanked/Underserved Population Growth #1 in Digital Potential + Optimi

25. Slide 25: Trends suggest great opportunity for MTNN

    Exciting demographic opportunity | trends suggest great opportunity For MTNN Strong growth potential from favourable market trends. Increase in # of Data Users Upside From Digital | 41% 81% Data Usage GDP Growth and MFS 43.2960 ' > per User‘) +3593) possess (+17m subs}? | Smartphone +565949) 1 ee {3

26. Slide 26: Loyal, high value customer base

    Well-positioned for the long Ferm | loyal, bigh value customer base br) Focus on convenience, quality and value attracts high value customers with highest data usage. + Largest number of smartphone and 4G users * High value customers * Opportunity fo upgrade ~25m 2G data users to boost data usage *

27. Slide 27: Commercial fundamentals for future growth

    Well-positioned for the long Ferm | commercial fundamentals for Future growth Leading commercial proposition allows MTNN to attract customers across all segments and focus on high valuesegment. Largest Physical Distribution Network in Nigeria >1m retail touchpoints es Enabler of subscriber acquisiti

28. Slide 28: MTNN vs Globalcom, Airtel, 9Mobile

     –      MTNN Globalcom Airtel 9Mobile  – –  –

29. Slide 29: Strong management team

    Well-positioned for the long Ferm | strong management team Highly experienced management, transparent corporate governance and supported by expertise and resources of MTN Group. Seasoned team with successful track record, having driven robust turnaround Feiss at MTNN over the last two years EC 14 ye

30. Slide 30: Well-positioned to deliver cash flow growth

    Attractive profile | well-positioned to deliver cash Flow growth br) Positive momentum with accelerating growth and performance improvement. (000) (YoY growth %) 498 1,965 14.1m active 2m active MFS data users users 15.0% +84% YoY growth in +27% YoY growth in data revenue MFS users (6,876) VAS optim

31. Slide 31: Modernised subscriber definition

    Well-positioned for the long Ferm) modernised subscriber definition br) Q2 2015: Fuel Crisis impacting H1 2016: Suspension of ~ Q3 2016: Resumption of CA) 236.7 network operations regulatory services regulatory services 70 225 217.1 217.9 213.7 207.9 66 e CB ] Subscriber H1 2017: Applied ong Bm mode

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33. Slide 33: MTN Nigeria summary highlights

    MTN Nigeria | summary highlights Strong position in attractive market Attractive return profile Clear strategy G 4 Exciting demographic opportunity Well-positioned for the long Ferm 33

34. Slide 34: Rahul De

    Rahul De (Chief Marketing Officer) y IE XS everywhere you go

35. Slide 35: Understanding MTN Nigeria

    Understanding MTN Nigeria Woics ata Digital and MES | coreeveruet _ * Voice Service + Interconnect * Mobile Data + Fixed Data * Digital and Value-Added Services * Mobile Financial Services + SMS + ICT and Infrastructural Services + Roaming * Devices 2017 Revenue: §653bn Y-Y Growth: 8% Source: Compan

36. Slide 36: Clear strategy to capitalise on market opportunity

    Clear strategy fo capitalise on market opportunity eM OK OK OK XK | Key Commercial Levers... ... To Ignite Performance and Optimise Experience Understanding of Segmented Customer Needs Drives Differentiated Core Offerings * Value for Money Proposition — Differentiation through quality — Competition

37. Slide 37: Pricing strategy: value for money

    Pricing strategy | value for money barn MTNN aims fo provide the best value proposition to its subscribers + Convenience and service quality * Personalised offers Easy Fen eneeteene | * Bundles include international roaming Focus = Bundling to increase aggregate spend Personal + Competitive rate bas

38. Slide 38: Data: dual strategy driving penetration and growth

    Data | dual strategy driving data penetration and growth br) Data strategy designed to increase value for existing data users while converting non-data users + MTNN's dual data strategy to maximise reach and data usage is Total Data Users Data Usage composed of these elements: (m) (MB per user per m

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    ₦     ₦     ₦   ₦     ₦   ₦    ₦   ₦    ₦    ₦    

40. Slide 40: Device strategy supporting data growth

    Device strategy supporting data growth Data usage is shifting to align with global trends, where increases in data traffic are driven by content (over 90%, including video, music and other digital content) Drivers of MTNN Data Traffic (%) Software 5.7% Other traffic 43.6% Video and Social Media 50.7

41. Slide 41: Largest distribution network nationwide

    Largest distribution network nationwide br) + Combination of traditional physical ingires iret iio channels and new digital channels Traditional Alternative Channels COCO & FOFOM Electronic Distribution provide geographic spread across urban, + Trade Partners + Data Partners + Experience Centres + M

42. Slide 42: Structured outlets

    Strucrured outlets Physical Channels Company-Owned, Company-Operated Shop in Shop >15 Service Centres >125 Data Partner Stores Company-Owned, Company-Operated Activation Points >150 Connect Stores ¢.20,000 SIM Registration Agents Franchise-Owned, Franchise-Operated Retails >50 New Dawn Stores > 1m U

43. Slide 43: Digital channels: efficiency and customer convenience

    Digital channels | efficiency and customer convenience wiIMTN NOE & Data Load over Borrow Airtime Seratched Card 719M @ 1 con 10,278 Recent Recharge History > ~ —_ 0 im i] i] Rechargefton Rechargevia Recharges Tork Account —“SebitUsid”——Topup cad - f Send Airtime Recharge & Friend Retail Payment 0 R

44. Slide 44: Customer acquisition: compliant registration platform

    Customer acquisition | compliant registration platform br) . Poor identification system . Low broadband penetration + Inadequate address system + Literacy issues + Power issues M Compliance Incentive <3, Systems “> People * Registrations in structured outlets + Improved commission structure + Robust

45. Slide 45: Aspirational brand supports strong positioning

    Aspirational brand supports strong positioning MTNN’s extensive footprint across the country is underscored by high impact media visbility in all key areas of Nigeria, including the top 12 cities, which are regionally differentiated Nationwide Coverage and Voice and Data Reliability Value for Money

46. Slide 46: Engaging campaigns drive brand affinity

    Engaging campaigns drive brand affinity @D Tailored Campaigns Overview * Campaigns transmitted via multi-media channels including TV, radio, press, outdoor, digital, flyers, word of mouth, sponsorship etc. * Campaigns are regionally differentiated by ethnicity, language and relevant regional themes

47. Slide 47: Thematic video content builds deep connections

    Thematic video content builds deep connections “Wonder woman” Create natural and organic (1.0m views) engagements via the people they love and connect with Connections: Deepen Engagement “Mother in Love” (3.3m views) ie) %| Leverage content platforms, social media initiatives and rich media tools to

48. Slide 48: Meaningful social media engagement

    Meaningful social media engagement br) Leverage the full spectrum of digital solutions and avenues to create non-linear genuine connections and experiences with customers across all digital touchpoints with a view to convert and grow Top 5 YouTube Brands by Uploaded Video Views Telecommunication Com

49. Slide 49: Improved, multi-channel customer service

    Improved, multi-channel customer service br) Customer experience is bulk upon comprehensive customer care Ee eo MTN USSD & Call MyMTN App Centre Overall Customer Service 4 +42 p.p. Increase in Customer oD Service Level Comprehensive Ra Calls to Call Centre Agents Customer Care Key 69% Reduction Acco

50. Slide 50: Focus on digital and MFS

    Focus on digifal and MFS Rahul De (Chief Marketing Officer)

51. Slide 51: Digital services to drive the future of MTNN

    Digital services to drive the Future of MTNN MTNN's Innovative Portfolio of Products and Services Delivers an Optimal Experience to the Customer Ne Digital and VAS Mobile Fi ial Services Downloadable content, music, gaming, SIM back-up, news, trivia, gaming, software, airtime lending, other content

52. Slide 52: Latest digital and value-added services

    Providing the latest in digital and value-added services MTN Play Variety of downloadable mobile content MTN Music+ Digital music streaming / downloading Mobile Newspaper News service (partnership with Huawei) Game+ Gaming service (partnership with Huawei) MTN Comedy+ Comedy video-on-demand platform

53. Slide 53: E-commerce partnership

    Grocery Phones & Electronics Fashion Travel Logistics • Food Payment & Digital • Services • • ₦

54. Slide 54: Partnering under a bank-led model

    Partnering under a bank-led model + The Diamond Y'ello Account offered in partnership with Diamond Bank + We have formally submitted an application (using an SPV) . ; . , to the CBN for a Super-Agent license + Variant of a savings account with more convenient KYC procedures that allows customers to

55. Slide 55: Pioneer in Nigerian mobile financial services

    Pioneer in Nigerian mobile financial services * Bank account offered in partnership with Diamond Bank + Account can be opened and operated via mobile without forms or going fo the bank 3.0 41,840% 25 2.0 15 + In partnership with the Nigerian Inter Bank Settlement System (NIBSS) 10 + Bank and Telco a

56. Slide 56: Lynda Saint-Nwafor

    Lynda Saint-Nwafor (Chief Enterprise Business Officer)

57. Slide 57: MTNN's extensive B2B product suite

    MTNN’s extensive B2B product suite... Dedicated fo providing innovative solutions to MTNN’s broad range of enterprise clients, from SMEs to multinationals Mobile voice, fixed voice and bulk messaging Colocation, data hosting and VPS M-advertising, M-gaming, SME and government-citizen Voice & Messagi

58. Slide 58: A clear differentiator vs. competition

    ... a clear differentiator vs. competition br) Non-Core Services Core Services Mobility ( loT Analytics 9Mobile e MTN is the only player active in all areas of enterprise business Airtel e@ (3) ae @ = z e o;e 6 Vodacom Business MainOne * Internet Solutions + Business Connexion BCX onrexcenne + Rack

59. Slide 59: Diverse enterprise client base

    Diverse enterprise client base Over 800,000 registered SMEs, 850 large enterprises and 100 public sector clients make up the Enterprise portfolio Unserved and Underserved Inclusion Over 800,000 registered SMEs on The Marketplace and 3m+ SME prepaid subscriptions Partner of Choice for Large Enterpris

60. Slide 60: Corporate governance and regulations

    ee —" /| Ay) Corporate governance and regulations Tobechukwu Okigbo (Corporate Relations Executive)

61. Slide 61: Key government agencies and regulatory bodies

    Key government agencies and regulatory bodies * Federal Ministry of Communications * Responsible for ICT policy formulation and facilitating ICT as a key tool in the transformation agenda for Nigeria in the areas of job creation, economic growth and transparency of governance NEC SSUES + Independent

62. Slide 62: Regulatory developments

    Regulatory developments br) MTNN acquired Visafone. Ongoing dispute with NCC around usage of 800MHz NCC designated MTNN as a spectrum dominant operator in mobile voice and wholesale leased lines and transmission capacity market segments The fine reduced to 8330 bn with payment spread in 6 tranches o

63. Slide 63: Strengthening governance and compliance

    Strengthening governance and compliance Fine related to the timing of MTNN’s disconnection of 5.1m unregistered subscribers in August and September 2015 @ 26 Oct 2015 Announced ¥1,040bn fine (US$5.2bn) @ 28 Oct 2015 NCC suspended regulatory services to MTNN @ 3 Dec 2015 Fine reduced to 8674bn (US$3.

64. Slide 64: Extensive recognition for the MTN Foundation

    Extensive recognition for the MTN Foundation br) MTN Foundation: bor + Established in 2004 to manage CSR initiatives for MTNN; one of the first corporates in Nigeria to MTN Y'ello Doctor launch such an initiative Mobile medical support + The Foundation is a Company Limited by Guarantee, and has an i

65. Slide 65: Technology and network excellence

    ~ 4 Technology and nefFwork excellence Hassan Elchami (Chief Technical Officer) AY

66. Slide 66: Highlights of MTN Nigeria network infrastructure

    Highlights of MTN Nigeria network infrastructure a Unmatched nationwide coverage (c.90% of population and c.70% of land mass) One of the largest fibre networks in Africa, spans approximately 25,000km across all the cities in Nigeria The major contributor in the development of telecom infrastructure

67. Slide 67: MTN Nigeria GSM/3G/LTE network coverage

    MTN Nigeria GSM/3G/LTE network coverage Source: Company data. Coverage MTNN Coverage by Population N 90% == MTNN Coverage 13% 69% 90% ‘Source: Company Data ‘Source: Company Data Unmatched nationwide coverage with c.90% of population covered The major contributor in the development of telecom infrast

68. Slide 68: Network comparison vs peers

    MTNN Globalcom Airtel 9Mobile – – – –

69. Slide 69: Leading network quality and performance

    Leading network quality and performance 1Q152Q15 3Qi5 4qis 1Q16 2a 16 3Qi6 416 1917, 2Q17 3Q17- 4Q17 Dainet Source: Dashboard Download Speed (Mbps) (December 2017) 4G 3G 36.8 23.5 8.0 78 6.9 s Deirtet ® Dairtet ® Source: Ookla Speed Test Data Volume on MTNN Network (TB) ee ee Jan'17 Feb'17 Mar'l7 Ap

70. Slide 70: Network comparison vs peers

    MTNN Globalcom Airtel 9Mobile – – –

71. Slide 71: Attractive spectrum holdings

    Attractive spectrum holdings br) bend g ® Dairtet OY reer Gees — @ smile Frequency me 2,100 MHZ) 2x10 2x10 2x10 1,800 MHz 2x15 2x15 2x15 2x15 900 MHz 2x5 2x5 2x5, 2x5 2x10 1800 MHz 2x10 2x10 700 MHz 2x10@ + Clear spectrum advantage over peers, in particularly in 4G + MTNN has won a 10 year 2,600MHz

72. Slide 72: Key network investment areas 2015 to 2017

    Key network investment areas | 2015 fo 2017 Source: Company Data, 2015 2016 2017 2G and 3G coverage expansion 2G and 3G coverage expansion + 2G and 3G coverage expansion + Add Sectors for existing 3G sites Rollout of 4G and advanced 4G in Nigeria Rollout of 4G + Added 4G sites on 800MHz and 2,600MHz

73. Slide 73: Partnership with towercos improved access network

    Partnership with towercos improved access nefwork + MTNN diversified its network infrastructure risk by selling the majority of its towers to a tower company, IHS Holding and executed lease agreements with IHS and various other tower companies Average tenure of Towercos: 10-years Total number of tow

74. Slide 74: Scalable, state-of-the-art IT platforms

    Scalable, state-of-the-art IT platforms barn + Increased adoption of server virtualisation and cloud technologies Well invested IT architecture establishes the context for both the business for mission critical services and the operating models + Increased storage and processing power to process up

75. Slide 75: Financial overview

    ee LV jam WW) J } a i Financial overview Adekunle Awobodu (MTN Nigeria CFO)

76. Slide 76: Financial highlights

    Financial highlights Source: Company information, Voice revenue growth driven by strong growth in subsc er base, increased uptake of new plans and effective customer value management Substantial growth in data driven by increased data penetration and usage, network quality and uptake of lifestyle bu

77. Slide 77: Financial snapshot

    Financial snapshot (NGN bn) rev neers 28> 79%. 77%, 79% 807 794 B85 2015 2016 2017 sums Revenue Gross Margin (NGN bn) EBITDA 54x60 > 3985 434 356 (incl. Fine), a (incl. Fine)) 2015 2016 2017 (NGN bn) 203 165 738 oe 2015 2016 2017 Source: Company information. (NGN bn) 218 214 218 236 1Q 2017 2Q 2017

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79. Slide 79: Total revenue

    Total revenue Total Revenue Split (NGN bn) Voice “eVoice Service» Interconnect = Data 307 794 Other 885 31 CAGR 2015-17 Revenue Mix (%) 201s 7016 2017 Voice 78% 76% 74% FP _ Voice Service 67% 64% 63% Inte t 11% 12% 11% Data 9% 7% 12% Digital & MFS 9% 13% 11% Other 4% 4% 3% ‘Source: Company informati

80. Slide 80: Drivers of revenue: voice and data

    Drivers of revenue | voice and data barn Suspension of regulatory services prevented MTNN from launching new plans and 2016 characterised by a return to basics for MTNN: placed a drag on growth during 2016 Regulatory action limited out-of-bundle data revenue + Improved network quality and coverage c

81. Slide 81: Revenue breakdown: digital and MFS

    Revenue breakdown | digifal and MFS Digital and MFS Revenue Split (NGN bn) VAS mMFS. 157 94.7 ” 13 66.8% 24.0 52.1% 75.3 0.5 10.4 ~ Digital | 87.6 _ Digital Digital | 69.4 | 64.50 2015 2016 2017 ‘Source: Company information, Decline in revenue due to VAS / Digital optimisation: - Reduced number of s

82. Slide 82: Revenue breakdown: other

    Revenue breakdown | offer Other Revenue Split ee ee (NGN bn) CAGR = SMS —mICT& Infrastructure = Roaming —_—» Devices 2015-17 Con 1.2% as 308 C20 16 28.7 16 ee 27.9% 55 i 61 65 ae (11.496) 2015 2016 2017 Revenue Mix (%) SMS 42% 38% 41% ICT and Infrastructure 36% 35% 29% Roaming 17% 21% 21% Devices 5%

83. Slide 83: Cost base summary

    Cost base summary 34% Cost of Sales Operating Expenses (“Opex”) 66% ‘Source: Company information, Interconnect Dealer Commissions Digital / VAS Costs Regulatory Fees and Levies Other Site Lease Rental, Utilities and Fuel Maintenance Professional Fees Salaries, Staff Costs and Training Marketing Othe

84. Slide 84: Cost breakdown: cost of sales

    Cost breakdown | cost of sales (NGN bn) CAGR Understanding Cost oF Sales <>) 184 184 —— + Increased interconnect cost due to: (Haeky 16 - Promotions and bundling 2.2% - Naira devaluation impacting international interconnect 7.7%% . . - Impact of regulatory action through higher MTRs + Successfully r

85. Slide 85: Cost breakdown: opex

    Cost breakdown | opex (NGN bn) 356 2015, 2016 2017 = Site Lease Rental, Utilities and Fuel m Maintenance Professional Fees Salaries, Staff Costs and Training m Marketing Other Source: Company information. Notes: (1) Includes Site Lease Rental (2015: ¥80bn; 2016: ¥130bn; 2017: 203bn). eon ee ee ee In

86. Slide 86: Understanding movements in site lease rental costs

    Understanding movements in site lease rental costs barn Percentage of Total Change + Within network-related costs, the most notable 203 increase has been in terms of site lease rental costs + Aggressive network expansion has driven a substantial increase in number of 3G and 4G sites — which was the

87. Slide 87: EBITDA

    EBITDA (NGN bn) EBITDA Margin (Gx Fine) = EBITDA Margin (incl. Fine) 19.7% ATA 39.0% + Recognition of the NCC fine impacted 2015 and 2016 EBITDA: 3769 - 2015 EBITDA reduced by 8275bn initial (incl. fine) recognition of a provision for the NCC fine - 2016 EBITDA increased by §20bn remeasurement of th

88. Slide 88: Capital expenditure breakdown

    Capital expenditure breakdown Capital Expenditure | Expenditure 225 196 130 2015 2016 2017 j= Network mIT = Other Capex Capex Mix (%) (20.8%) (44.5%) 101.8% Network 37% 78% 87% IT 54% 19% 10% Other Capex 38% 3% 3% MTNN's ongoing capex plan is focused on network, specifically: = 4G rollout in key cit

89. Slide 89: Net working capital development

    Net working capital development Change in Net Working Capital (NGN bn) 61.2 Ts (12.0) (71.8) 2015 2016 2017 (NGN bn) 2015 2016 2017 Decrease / (increase) in inventories (3.4) (4.2) 0.8 Decrease / (increase) in receivables and prepayments (8.6) 29.5 (18.2) (Decrease) / increase in trade and other pay

90. Slide 90: Taxation

    Taxation barn (%) Income Tax Caz) (NGN bn) + 2017: ETR closed at c.25% For the year; difference arose From: 30% rom: 25% — Net tax effect of education tax, investment allowance and prior year overprovision — Exemptincome from investment in Federal Government bonds NM. + 2016: ETR closed at ¢.30%, re

91. Slide 91: Free cash flow analysis

    Free cash flow analysis br) (NGN bn) 2015 2016 2017 434 356 346 (78) (165) (203) 356 191 143 (12) 61 (72) a i ee ee (90) (80) (59) Oo er er ee - (3) (1) Levered FCF 217 60 (56) Notes! G) Excluding recognition and remeasurement of provision forthe NCC fine: cash impact shown separately (2) Shown net

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105. Slide 105: Thank you

     Thank you

MTN Nigeria Communications — Investor Day (April 2018) on 6ix