MTN BUSINESS REPORT 2005 MTN group profile 4,8 6,7 9,5 14,3 14,3 million subscribers across the continent providing cellular ser
Over the past 11 years MTN has, through its investment in infrastructure and provision of telecommunications services, had a si
CO NTEN TS 1 2 4 5 6 7 9 10 14 18 26 30 47 49 53 Highlights MTN milestones MTN Group values MTN footprint MTN Group structure M
MTN BUSINESS REPORT 2005 highlights Our Vision “to be the leading provider of telecommunications in developing markets” Subscri
MTN BUSINESS REPORT 2005 MTN milestones 1994 M-Cell (now MTN Group) incorporated in South Africa and owned 25% of MTN Holdings
MTN BUSINESS REPORT 2005 2002 M-Cell was renamed MTN Group to consolidate group structure and reinforce African presence and aw
MTN BUSINESS REPORT 2005 MTN group values MTN has, as its core, five shared values adopted and accepted across all its operation
MTN BUSINESS REPORT 2005 MTN footprint South Africa Launch date: Jun 1994 MTN shareholding: 100% Population: 47,1 million Mobil
MTN BUSINESS REPORT 2005 MTN group structure MTN G R O U P LI MI TE D 100%* MTN Group management services 100%* MTN Holdings MT
MTN BUSINESS REPORT 2005 contents Key objectives Chairman’s report Directorate Group chief executive officer’s report Executive c
MTN BUSINESS REPORT 2005 key objectives Strategic objectives Building on our strategic vision and operational strength, the Gro
MTN BUSINESS REPORT 2005 chairman’s report Our goal is to support the African continent into a new age of economic development
MTN BUSINESS REPORT 2005 over 14 million customers across the continent. During the past financial year the MTN Group has mainta
MTN BUSINESS REPORT 2005 chairman’s report continued compliance with the policies. Also during the reporting year, the Group’s
MTN BUSINESS REPORT 2005 Acknowledgements As Chairman of the Board, it gives me great pleasure to be able to report an outstand
MTN BUSINESS REPORT 2005 directorate 2 4 1 5 3 6 1. PL HEINAMANN (63) AMP(INSEAD), FSRM(SA) Non-executive director 2. MC RAMAPH
MTN BUSINESS REPORT 2005 7 10 8 12 9 11 7. I CHARNLEY (44) MAP COMMERCIAL DIRECTOR 8. JHN STRYDOM (66) MCom (Acc), CA(SA) Non-e
MTN BUSINESS REPORT 2005 board of directors’ CVs MC RAMAPHOSA (52) BProc, LLD (hc) CHAIRMAN Non-executive director* since 2001
MTN BUSINESS REPORT 2005 RS DABENGWA (46) BSc (Eng), MBA GROUP CHIEF OPERATING OFFICER Executive director since 2001 Prior to j
MTN BUSINESS REPORT 2005 group chief executive officer’s report “A number of initiatives are in place which will assist the compa
MTN BUSINESS REPORT 2005 for complementary technologies such as VoIP and internet access, emerging markets are fast evolving as
MTN BUSINESS REPORT 2005 chief executive officer’s report continued Accelerated network roll-out in Nigeria: The operation has si
MTN BUSINESS REPORT 2005 Group total assets have increased by 32% to R29,4 billion at 31 March 2005, against R22,3 billion at 3
MTN BUSINESS REPORT 2005 chief executive officer’s report continued Operational overview The Group’s revenue growth has been fuel
MTN BUSINESS REPORT 2005 subscribers at 31 March 2005, reflecting the vigorous roll-out by MTN Nigeria and to a lesser extent th
MTN BUSINESS REPORT 2005 chief executive officer’s report continued A Group-wide strategy is in place to explore avenues to co-op
MTN BUSINESS REPORT 2005 Looking ahead The Group’s key strategic objectives for the coming year include: • Continue identifying
MTN BUSINESS REPORT 2005 executive committee members 4 1 2 5 3 6 1. PF NHLEKO BSc (Civil Eng), MBA GROUP CHIEF EXECUTIVE OFFICE
MTN BUSINESS REPORT 2005 7 10 8 11 9 7. PD NORMAN MA (Psychology) GROUP EXECUTIVE HUMAN RESOURCES 8. KW PIENAAR BSc (Electrical
MTN BUSINESS REPORT 2005 executive committee members CVs PF NHLEKO BSc (Civil Eng), MBA GROUP CHIEF EXECUTIVE OFFICER since 200
MTN BUSINESS REPORT 2005 PD NORMAN MA (Psychology) GROUP EXECUTIVE HUMAN RESOURCES Mr Norman has been a Group Executive since 1
MTN BUSINESS REPORT 2005 group finance director’s report The Group recorded strong revenue growth of 21% and adjusted headline e
MTN BUSINESS REPORT 2005 continues to explore further expansion opportunities to access markets offering strong earnings growth
MTN BUSINESS REPORT 2005 group finance director’s report continued Subscribers Table 2: Subscribers Subscribers per operation So
MTN BUSINESS REPORT 2005 The increase in Group revenue of 21% year-on-year was primarily attributable to another excellent perf
MTN BUSINESS REPORT 2005 group finance director’s report continued MTN South Africa Table 5: MTN South Africa revenue compositio
MTN BUSINESS REPORT 2005 MTN Nigeria recorded revenue of R9,3 billion up 34% from the previous year. The strengthening of the r
MTN BUSINESS REPORT 2005 group finance director’s report continued EBITDA Table 7: MTN Group EBITDA per operation For the year e
MTN BUSINESS REPORT 2005 The year-on-year increase in sales, distribution and marketing expenses was restricted to 15%, being l
MTN BUSINESS REPORT 2005 group finance director’s report continued Other mobile operations The EBITDA margin for MTN Cameroon at
MTN BUSINESS REPORT 2005 During the year under review, correspondence was received from certain Nigerian authorities regarding
MTN BUSINESS REPORT 2005 group finance director’s report continued Balance sheet The total assets for the Group have increased b
MTN BUSINESS REPORT 2005 capital expenditure incurred was 78% of the commitment for the year, the shortfall being attributable
MTN BUSINESS REPORT 2005 group finance director’s report continued The Group’s net cash position has increased from R1,2 billion
MTN BUSINESS REPORT 2005 Free cash flow after investing activities All the operations except MTN Nigeria reflected positive free
MTN BUSINESS REPORT 2005 group finance director’s report continued Change of year end The financial year-end of MTN Group and its
MTN BUSINESS REPORT 2005 interim results for the six months ending 30 September 2005 as well as restated comparatives. To this
MTN BUSINESS REPORT 2005 group finance director’s report continued Conclusion The Group’s performance over the past financial yea
MTN BUSINESS REPORT 2005 contents MTN South Africa MTN Nigeria MTN Cameroon MTN Uganda MTN Rwanda MTN Swaziland Strategic inves
MTN BUSINESS REPORT 2005 MTN South Africa Company overview MTN South Africa launched its services in 1994 and is the second-lar
MTN BUSINESS REPORT 2005 MTN South Africa continued Marketing The key focus areas during the year were enhancing brand affinity,
MTN BUSINESS REPORT 2005 229 208 206 203 184 2 111 2 003 1 845 1 515 1 403 172 168 164 155 140 ’01 ’02 ’03 ’04 ’05 ARPU blended
MTN BUSINESS REPORT 2005 MTN South Africa continued The needs of the customer today have changed. Previously all customers want
MTN BUSINESS REPORT 2005 MTN Nigeria Company overview MTN Nigeria continues to report subscriber growth well in excess of initi
MTN BUSINESS REPORT 2005 MTN Nigeria continued percentage of local content in terms of both materials and companies used for si
MTN BUSINESS REPORT 2005 0,5 1,4 3,1 7,0 60 57 51 40 198 476 972 1 857 ’02 ’03 ’04 ’05 ’02 (US$) ’03 ’04 ’05 ’02 ’03 ’04 ’05 GS
MTN BUSINESS REPORT 2005 MTN Nigeria continued Legal and regulatory MTN achieved 100% compliance with licence conditions during
MTN BUSINESS REPORT 2005 MTN Cameroon Company overview MTN Cameroon started operations during 2000, following the acquisition o
MTN BUSINESS REPORT 2005 MTN Cameroon continued 1,1 2,9 5,0 6,7 9,7 29 24 21 24 23 44 60 106 165 197 ’01 ’02 ’03 ’04 ’05 GSM pe
MTN BUSINESS REPORT 2005 MTN Uganda Company overview MTN Uganda was awarded the country’s second national operator licence, whi
MTN BUSINESS REPORT 2005 MTN Uganda continued Being “everywhere you go” means MTN customers travelling to any of the footprint
MTN BUSINESS REPORT 2005 0,9 1,4 2,1 3,1 4,2 40 37 28 22 19 67 106 140 176 204 ’01 ’02 ’03 ’04 ’05 GSM penetration of populatio
MTN BUSINESS REPORT 2005 MTN Rwanda Company overview MTN Rwanda is approaching its seventh year of commercial operation. MTN wa
MTN BUSINESS REPORT 2005 0,5 0,8 1,0 1,2 1,7 48 38 27 22 19 14 22 31 39 43 ’01 ’02 ’03 ’04 ’05 GSM penetration of population (P
MTN BUSINESS REPORT 2005 MTN Rwanda continued MTN Rwanda is proud of its role in nurturing the global MTN brand. MTN Rwanda lau
MTN BUSINESS REPORT 2005 MTN Swaziland Company overview MTN Swaziland is approaching its seventh year of commercial operation.
MTN BUSINESS REPORT 2005 MTN Swaziland continued 3,2 5,5 6,8 7,7 13,0 44 28 21 31 29 119 151 192 226 282 ’01 ’02 ’03 ’04 ’05 GS
MTN BUSINESS REPORT 2005 strategic investments Overview Strategic Investments is responsible for exploring growth opportunities
MTN BUSINESS REPORT 2005 strategic investments continued New business development – non-mobile ventures In conjunction with oth
MTN BUSINESS REPORT 2005 shareholders’ information as at 31 March 2005 Spread of ordinary shareholders Number of shareholders 4
MTN BUSINESS REPORT 2005 five year review 2005 INCOME STATEMENT – EXTRACTS (Rm) 2004* 23 871 14 212 9 055 6 679 (604) (1 101) (6
MTN BUSINESS REPORT 2005 2005 OPERATIONAL INFORMATION: SOUTH AFRICA 2004 203 6,3 36,0 7 1 515 51 1 966 49 24 581 38 22 495 27 2
MTN BUSINESS REPORT 2005 group cash value added statement 2005 Rm CASH VALUE ADDED Cash value generated from revenue Cost of ma