mobile telecommunications company k.s.c. 2006 earnings...

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Mobile Telecommunications Company K.S.C.

2006 Earnings Release

MTC ANNOUNCES A RECORD NET INCOME EXCEEDING USD 1 BILLION

AND REVENUES OVER USD 4.1 BILLION

Financial & Operational Highlights

As of 31 December, 2006, MTC’s customer base exceeded 27 million active

customers* across the Middle East and Africa, representing a 98% increase compared

to 2005.

For the full year of 2006, MTC posted Consolidated Revenues exceeding USD 4.1

billion (KD1.2 billion), a 109% increase

During the same period, MTC recorded an EBITDA of more than USD 2 billion (KD 594

million), a 78% increase

EBIDTA Margin stood at 49% in 2006 compared to 58% in 2005.

The Group recorded a Record Net Income of USD 1 billion (KD 305 million) for the

same period, a 68% increase

MTC’s EPS reached 85 Cents (247 fils) by the end of 2006, a 36% increase compared to

same period last year.

*All customer figures in this earnings release represent active customers, those who have made a chargeable event within a 90 days

period. MTC has retroactively adjusted the customer figures accordingly.

2006

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Customers

Table 1: MTC Group Customer Breakdown & Market Positioning

Ownership

(%)

2006

Active Customers

(000s)

2006

Active Customers

(000s)

2005

Growth

(%)

Prepaid

(%)

2006

Market

Positioning

MIDDLE EAST

Bahrain 60% 233 173 35% 80.3% 2

Iraq 30% 3,198 1,073 198% 98.9% 1

Jordan 96.5% 1,961 1,757 12% 88.8% 1

Kuwait 100% 1,461 1,331 10% 74% 1

Lebanon MC 560 509 10% 76.5% -

Sudan* 100% 2,754 1,962 - 97.6% 1

Middle East Total - 10,167 6,805 49% 91.33% -

AFRICA

Burkina Faso 95.7% 518 299 73% 99.9% 1

Chad 100% 348 222 57% 99.8% 1

Congo Brazzaville 90% 683 378 81% 99.8% 1

DRC 98.5% 1,833 1,178 56% 99.9% 1

Gabon 84% 514 365 41% 99.3% 1

Kenya 60% 1,939 1,840 5% 98.1% 2

Madagascar** 100% 331 - - 95.8% 2

Malawi 100% 357 199 79% 99% 1

Niger 80% 397 223 37% 99.9% 1

Nigeria*** 65% 6,396 - - 99.5% 3

Sierra Leone 100% 243 178 37% 99.5% 1

Tanzania 60% 1,517 971 56% 99.6% 2

Uganda 100% 470 291 62% 99.5% 2

Zambia 88.8% 1,325 700 89% 99.6% 1

Africa Total - 16,870 6,845 147% 99.3% -

MTC Group Total - 27,037 13,650 98% 96.3% -

*MTC acquired the remaining stake of Mobitel in February 2006;

**MTC acquired Madacom in December 2005;

***MTC acquired V-Mobile in May 2006;

MC = Management Contract

All figures represent active customers, those who have made a chargeable event within a 90 days period

2006

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Nigeria38%

Kenya11%

DRC11%

Tanzania9%

Zambia8%

Rest23%

Celtel InternationalCustomers

Bahrain1%

Iraq12%

Jordan7%

Kuwait5%

Lebanon2%

Sudan10%

Celtel Int.63%

MTC GroupCustomers

As of December 31 2006, MTC Group was operating on 2 continents and was serving 27.037 million active

customers – an increase of 98% compared to the same period last year. The company was present in 20 countries

across Africa and the Middle East with a total population of 470 million people under license – making it the 5th

largest mobile operator in the world in terms of geographic footprint.

The company’s remarkable customer increase was driven primarily by its high-growth African operations; and its

acquisition of the remaining stake in Sudan’s Mobitel and a controlling stake in Nigeria’s third mobile operator,

which alone added over 1.9 million and 5.5 million subscribers at the time of acquisition, respectively. Out of the

20 countries where MTC operates in, 14 subsidiaries are consistently the leading operators while 5 are in second

position; reflecting the company’s core strategy to be the leader in the markets it serves. As of 2006, MTC’s

African operations – through its subsidiary Celtel International – represented 63% of the company’s customer base

while the Middle East operations: Iraq, Sudan, Jordan, Kuwait, Lebanon and Bahrain represented the remaining

customers.

In 2006, MTC’s operation in Iraq – MTC Atheer – was once again the fastest growing operator of the group,

registering a remarkable 198% increase in customers. The second largest growth was registered in Zambia (89%),

followed by Congo Brazzaville (81%) and Malawi (79%). Except for Bahrain which registered a 35% increase in

customers, the more mature Middle Eastern operations grew at an average of 10% compared to 2005. All in all,

MTC’s African operations, through Celtel International, registered a 147% increase in customers while its Middle

Eastern operations registered a 49% increase compared to 2005.

Through the acquisition of the remaining stake Mobitel in Sudan and a controlling stake in V-Mobile in Nigeria,

MTC group added two densely populated and high growth countries to its operation, joining ranks with the

existing operators of Iraq, the Democratic Republic of Congo (DRC) and Kenya. Nigeria’s operation, which was

2006

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quickly rebranded as Celtel Nigeria in less than 100 days, now represents over 23% of MTC Group’s customer

base, followed by Iraq (11%), Sudan (10%), Kenya (7%) and DRC (7%).

MTC Group’s 20 operations are mainly composed of prepaid customers, representing over 96% of the total

customer base. Even though MTC’s Middle Eastern operations are over 90% prepaid, the group’s African

operations are the main driver behind this trend, with over 99% of customers owning prepaid lines. This

phenomenon clearly reflects the effects of the cash based economies of Africa and some Middle Eastern countries

such as Iraq. Having a majority of prepaid customers also significantly reduces the credit and collection risks for

MTC’s operations. The operators with the highest postpaid customers include Kuwait (26%), Lebanon (23.5%),

Bahrain (19.7%) and Jordan (11.2%).

Key Operational Events of the Period

6 February, 2006

MTC announces full acquisition of Mobitel in Sudan in a USD 1.332 billion transaction, thus increasing its

stake from 39% to 100%

21 May, 2006

MTC-Vodafone (Bahrain) launched the region’s first high speed 3.5G service – one of the world’s fastest

wireless broadband access technology using mobile phones and Data connect cards.

30 May, 2006

MTC’s Celtel International acquires a controlling stake in Vee Networks (V-Mobile) in Nigeria for USD

1.005 billion. The transaction was Celtel’s largest ever deal and increased MTC’s customer base by over

5.5 million while allowing it to tap into Africa’s most populous nation with some 140 million people.

27 September, 2006

Celtel International launches One Network in Tanzania, Kenya and Uganda – the first ever borderless

mobile network in the world allowing customers in East Africa to move freely across geographic

borders using local tariff rates and recharge cards without paying for incoming calls.

2006

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Financial Results

MTC recorded consolidated revenues of USD 4.168 billion (KD 1.210 billion) for the full year of 2006, an increase

of 109% compared to 2005. During the same period, the consolidated EBITDA increased by 78% to reach USD

2.045 billion representing an EBITDA margin of approximately 50%. The company’s net income reached a record

USD 1.050 billion (KD 305.30 million), a 68% increase compared to 2005, representing earnings of USD 0.85 per

share (247 fils).

MTC's performance figures were driven by organic growth, new license awards, and acquisitions over the past

three and a half years since the company embarked on its “3x3x3” expansion strategy. In 2006, MTC Group’s

strong financial performance was spearheaded by its more mature Middle Eastern operations and an impressive

113% increase in Celtel International’s revenues, reaching USD 2.05 billion.

Table 2: Financial Highlights

Consolidated Results 2006 2005 Annual

Growth

Currency USD KD USD KD

Revenues (millions) 4,168 1,210 1,982 580 109%

EBITDA 2,045 594 1,142 334 78%

EBITDA Margin (%) 49 58 -

Net Profit 1,050 305 636 182 68%

EPS 0.85 0.247 0.62 0.182 36%

Kuwait19%

Jordan12%

Bahrain3%

Lebanon1%

Sudan16%

Celtel Int.49%

MTC Group Revenues* (2006)

*Iraq is not consolidated

Kuwait33%

Jordan10%

Bahrain1%

Iraq2%

Lebanon1%

Sudan24%

Celtel Int.29%

MTC Group Net Profit (2006)

2006

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Table 3: Income Statement – Summary

Consolidated Results

(KD m) 2006 2005 Annual Growth

Revenues 1,210 579 109%

Cost of Sales 187 91 107%

Gross Profit 1,023 489 109%

Operating, General and

Administrative Expenses 452 214 111%

EBITDA 594 334 78%

EBITDA % 49% 58% -

Interest Income 18.3 5 296%

Gain from Currency

Evaluation 3.4 5.2 (35%)

Net Profit 305.3 181.9 68%

Table 4: Balance Sheet – Summary


(KD m) 2006 2005

Current Assets 692 394

Non-Current Assets 2,785 1,662

Total Assets 3,477 2,056

Current Liabilities 1,043 489

Non-Current Liabilities 947 348

Shareholders’ Equity 1,365 1,186

Minority Interest 122 33

Total Liabilities and

Equity 3,477 2,056

2006

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Table 5: Cash Flows – Summary


(KD m) 2006 2005

Net Cash from Operating Activities 795 283

Net Cash from Investing Activities (996) (923)

Net Cash from Financing Activities 360 778

Net Increase in Cash and Equivalents 159 138

Cash and Cash Equivalents at end of

Year 474 293

One of the main drivers to the strong financial results of 2006 was the acquisition of the remaining stake in Mobitel

and a controlling stake in Vee Networks (V-Mobile). From the date of the acquisition of Mobitel (6 February 2006),

the Sudanese operation contributed revenues of KD 190.8 million and a net profit of KD 95.9 million to the net

results of the Group. Additionally, from the date of the acquisition of V Mobile (31 May 2006), the Nigerian

operation contributed revenues of KD 177.18 million and net profit of KD 14.22 million to the net results of the

Group. If both acquisitions had taken place on 1 January 2006, the Group revenue and net profit would have been

higher by KD 120.17 million and KD 16.5 million, respectively.

MTC's total equity increased by 22% compared to 2005. Despite the increase, MTC had a robust growth of 36% in

its earnings per share in end of year 2006 (85 Cents) compared to 2005 (31 Cents). At the same time net cash

from operating activities significantly increased from KD 283 million to KD 795 million from 2005.

For year on year comparisons, revenues increases were highest at Celtel International (113%), followed by Bahrain

(53%), Kuwait (13%), Lebanon (7%) and Jordan (7%). Iraq’s revenues, which are not consolidated with the Group’s

results, increased by 142% compared to 2005.

Key Financial Events of the Period 26 July, 2006

MTC signed the general syndication agreement for the US$ 4 billion credit facility to be used to fund

MTC’s future acquisitions and general corporate needs.

06 December, 2006

A USD 1.2 billion Murabaha facility was successfully syndicated and oversubscribed for MTC.

2006

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2006 Stock Performance

Table 6: Stock Summary

Stock Summary USD KD

Closing Price (21/3/2007) 16.944 4.900

Paid-Up Capital 435.858 126.181

Share Par Value 0.34 0.100

EPS 0.85 0.247

Market Capitalization (Billions) $21.38 6.182

Year-on-Year Stock Price Growth 67%

P/E multiples 19.8

2006

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MTC’s Presence in the Middle East and Africa

2006

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Country Insights

Kuwait

Market Overview 2006 2005

Population (000s) 3,200 3,000

GDP/Capita (USD; PPP) 31,333 -

Mobile Penetration (%) 79% 78%

Number of Peers 1 1

Market Positioning 1 1

Ownership 100% 100%

Customers (000s) 1,461 1,331

Postpaid 382 358

Prepaid 1,079 973

Market Share (%) 59% 60%

ARPU ($) 65 64

Financial Performance 2006 2005 Annual

Growth

Net Revenues (USD m) 809 715 13%

EBIDTA (USD m) 540 427 26%

EBIDTA Margin (%) 67% 60% -

CAPEX (USD m) 92 - -

MTC-Vodafone Kuwait, the group’s first

operation, was established in 1983.

Currently there is only one peer in

Kuwait – Wataniya – however a third

mobile operator is to enter the highly

penetrated market.

MTC’s Kuwait operation had a total of

1.46 million active customers by year

end 2006, representing a 10% increase

in active customers compared to 2005.

The operation’s customers accounted

for 5% of MTC total customer base in

the Middle East and Africa regions.

MTC-Vodafone Kuwait’s 2006 revenues

reached a record USD 809 million, an

increase of 13% compared to 2005. The

operation’s revenues accounted for 19%

of MTC’s total – the largest single

source of revenues. Additionally,

EBITDA increased by 26% compared to

2005 and reached USD 540 million.

MTC-Vodafone Kuwait had a high

ARPU of $65 in 2006.

In 2006, MTC-Vodafone Kuwait began

offering brand new services such as

video call. The service was launched at

the 4th annual distributors’ exhibition

and more than 50,000 subscribed to the

video call service in the first launching

week, thus further branching out MTC-

Vodafone Kuwait’s revenue stream into

various value-added services.

MTC-Vodafone

59%

Wataniya41%

Market Share

427 540715 809

353 448

2005 2006

Financials (USD m)

EBITDA Revenues Net Profit

2006

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Jordan


Population (000s) 5,900 5,800



Number of Peers 3 3


Ownership 96.516% 96.516%

Customers (000s) 1,961 1,757

Postpaid 221 203

Prepaid 1,740 1,554


ARPU ($) 17 24


Growth

Revenues (USD m) 485 456 6%

EBIDTA (USD m) 254 242 5%



Jordan’s Fasltlink, is the group’s first

regional operation, and was acquired in

January 2003 for USD 423.9 million.

Currently there are three other peers

in Jordan in what is considered to be

one of the most liberalized telecom

markets in the Middle Eastern region.

MTC’s Jordan operation had a total of


end 2006, representing a 12% increase

in active customers compared to 2005.


for 7% of MTC total customer base in

the Middle East and Africa regions.

Fastlink’s 2006 revenues reached USD

485 million, an increase of 6% compared

to 2005. The operation’s revenues

accounted for 12% of MTC’s total

consolidated revenues. Additionally,



Fastlink had an ARPU of $17 in 2006.

In February 2006, Fastlink signed an

amended license agreement with the

Telecommunications Regulatory

Commission (TRC) of Jordan extending

its operations for another 15 years. The

renewal came as part of measures to

transfer non-category licensees to the

integrated regulatory and licensing

framework, whereby application

becomes an optional choice.

Fastlink, 53%

Umniah, 10%

Express, 7%

MobileCom,

30%

Market Share

242 254

456 485

145 135

2005 2006

Financials (USD m)


2006

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Bahrain


Population (000s) 700 700



Number of Peers 1 1


Ownership 60% 60%

Customers (000s) 233 173

Postpaid 46 27

Prepaid 187 146


ARPU ($) 31 37


Growth

Net Revenues (USD m) 107 70 53%




MTC-Vodafone Bahrain, the group’s

second regional operation, launched its

services in December 2003. MTC had

won the island’s second GSM license in

April 2003. Currently there is only one

peer in Bahrain – Batelco. Bahrain has

the highest mobile penetration rate in

the region and is leading the way in

offering triple play and Wi-Max services.

MTC’s Bahrain operation had a total of

233,000 active customers by year end

2006, representing a 35% increase in

active customers compared to 2005.


for a mere 1% of MTC total customer

base in the Middle East and Africa

regions.

MTC-Vodafone Bahrain’s 2006 revenues

reached a record USD 107 million, an

increase of 53% compared to 2005. The

operation’s revenues accounted for 3%

of MTC’s total consolidated revenues.

Additionally, EBITDA increased by an

amazing 125% compared to 2005 and

reached USD 36 million. MTC-Vodafone

Bahrain had an ARPU of $ 31 in 2006.

Regardless of its population size, the

Bahraini operation is of high importance

to MTC due to its potential to test pilot

new technologies and opportunities. As

an example, MTC-Vodafone Bahrain

launched the region’s first new high

speed 3.5G service in May 2006 and

acquired the license for nationwide Wi-

Max deployment.

MTC-

Vodafone30%

Batelco70%

Market Share

1636

70

107

119

2005 2006

Financials (USD m)


2006

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Iraq


Population (000s) 29,500 28,800



Number of Peers 2 2


Ownership 30% 30%

Customers (000s) 3,198 1,073

Postpaid 36 38

Prepaid 3,162 1,035


ARPU ($) 14 18


Growth





The 2-year license for MTC Atheer was

acquired in December 2003 to initially

cover the Southern region of Iraq. Two

other peers had won similar licenses to

cover the central and northern parts of

Iraq. Later on the coverage of MTC

Atheer was expanded to the whole

country and it is expected that MTC

will renegotiate its license with

authorities when its current interim

license expires in March 31, 2007. The

CMC is expected to award four 15-year

licenses in June 2007.

MTC’s Iraq operation had a total of


end 2006, representing a record 198%

increase in active customers compared

to 2005. The operation’s customers

accounted for 12% of MTC total

customer base in the Middle East and

Africa regions.

MTC Atheer’s 2006 revenues reached a

record USD 351 million, an increase of

142% compared to 2005. The

operation’s revenues are not

consolidated with MTC’s total revenues.



MTC Atheer had an ARPU of $14 in

2006.

The operation is considered as MTC

Group’s operator with the highest

prepaid ratio of customers in the Middle

East, with nearly 99%.

MTC Atheer,

36%

AsiaCell, 31%

Iraqna, 33%

Market Share

65114

145

351

-4

27

2005 2006

Financials (USD m)


$0

$100

$200

$300

$400

2004 2005 2006

Revenues (USD m)

$0

$100

$200

$300

$400

2004 2005 2006

Revenues (USD m)

$0

$100

$200

$300

$400

2004 2005 2006

Revenues (USD m)

2006

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Lebanon


Population (000s) 3,600 3,600



Number of Peers 1 1

Market Positioning - -

Ownership 100%* 100%*

Customers (000s) 560 509

Postpaid 132 126

Prepaid 428 383


ARPU ($) n/a n/a

*MTC owns the full stake of MTC Lebanon


Growth




CAPEX (USD m) 0.142 - -

In June 2004, MTC won a 4-year

management contract to operate one of

Lebanon’s two GSM operations.

Rebranded as MTC Touch, MTC has

developed the Lebanese operation to its

full potential in hope that it will be

added to the Group’s portfolio as soon

as the Government undergoes the

process of privatization.

MTC’s Lebanon operation had a total of

560,000 active customers by year end

2006, representing a 10% increase in

active customers compared to 2005.


for some 2% of MTC total customer

base in the Middle East and Africa

regions.

MTC Touch’s 2006 revenues reached

USD 58 million, an increase of 7%

compared to 2005. The operation’s

revenues accounted for 1% of MTC’s

total revenues. Additionally, EBITDA

increased by 42% compared to 2005

and reached USD 11 million. MTC

Touch has one of the highest ARPU’s in

the region. All the disclosed revenues

are those from the management

contract and not the total revenues of

the operation which are collected by

the Government of Lebanon.

In 2006, MTC Touch faced a month-

long war which affected the entire

nation, people, network and employees.

However, the entire network was up

and running throughout the conflict.

MTC Touch,

50%

Alfa, 50%

Market Share

7 11

54 58

7 9

2005 2006

Financials (USD m)


2006

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Sudan


Population (000s) 37,000 36,200



Number of Peers 2 0


Ownership 100% 39%*

Customers (000s) 2,754 1,962

Postpaid 65 -

Prepaid 2,688 -

Market Share (%) 59% -

ARPU ($) 25 -

*Through Celtel International

Financial Performance 2006** 2005 Annual

Growth

Revenues (USD m) 708 - -

EBIDTA (USD m) 415 - -

EBIDTA Margin (%) 59% - -


**MTC acquired remaining stake in February

In February 2006, MTC acquired 100%

of Mobitel in a deal valued at USD 1.332

billion. Initially, Celtel owned 39% of

Mobitel when it acquired the stake in

March 2001. Sudan is considered one of

Africa’s strategic countries with massive

potential, high economic growth and

large population of some 37 million.

Sudanese authorities have licensed three

other peers to operate mobile

networks, one of which has solely a

CDMA license (Sudani), another which

has solely a GSM license (Areeba) and

the last which now has both (Canar).

MTC’s Sudan operation had a total of


end 2006, accounting for over 10% of

MTC total customer base in the Middle

East and Africa regions.

Mobitel’s 2006 revenues reached USD

708 million, an increase of 4% compared

to 2005. The operation’s revenues

accounted for 16% of MTC’s total

revenues. Additionally, EBITDA

increased by 6% compared to 2005 and

reached USD 415 million. Mobitel also

had an ARPU of $25 in 2006.

MTC will develop the Mobitel operation

by expanding its network capacity and

coverage – one of the current weak

points of Sudan’s mobile sector. MTC

also plans to invest approximately USD

500 million through 2007 and will

leverage cross border opportunities

with neighboring Celtel operations.

Mobitel, 59%

Areeba, 20%

Sudani*, 19%

Canar*, 2%

Market Share

393 415

691 708

330

2005 2006

Financials (USD m)


*CDMA operation

2006

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Celtel International


Total Countries 14 12

Total Population (000s) 385,485 235,030

Highest GDP/Capita

(USD; PPP)

7,200

(Gabon) -

Lowest GDP/Capita

(USD; PPP)

600

(Malawi) -

Ownership 85% 85%

Customers (000s) 16,870 6,845

Postpaid 112 46

Prepaid 16,758 6,799

Global ARPU ($) 14.0 15.5


Growth

Revenues (USD m) 2,050 963 113%

EBIDTA (USD m) 897 454 97%

EBIDTA Margin (%) 44 47 -

CAPEX (USD m) 1,136 - -

MTC acquired Celtel International in

May 2005 for USD 3.36 billion and thus

dramatically expanded its presence in

the African continent. Initially, MTC

acquired 85% of Celtel for USD 2.84

billion with a commitment to buy the

remaining 15% over the next two years,

MTC’s Netherlands-based African

subsidiary had a total of 16.87 million

active customers by year end 2006,

accounting for 62% of MTC total

customer base in the Middle East and

Africa regions.

Celtel’s 2006 revenues reached USD

2.05 billion, a notable increase of 113%

compared to 2005. The operation’s

revenue accounted for 42% of MTC’s

total revenues. Additionally, EBITDA

increased by 98% compared to 2005

and reached USD 897 million. Celtel

had a Global ARPU of $14 in 2006.

In 2006, MTC showcased its dedication

to develop its African portfolio of

operators by acquiring a majority stake

in Nigeria’s V-Mobile and rebranding it

to Celtel Nigeria. MTC will continue to

invest in developing its presence in

Africa either through acquisitions of

new opportunities or service

amelioration of current operations.

Nigeria31%

DRC12%

Zambia9%

Gabon8%

Kenya8%

Tanzania8%

Congo 7%

Rest17%

Celtel International Revenues (2006)

Nigeria35%

Gabon13%

Congo 12%

Zambia9%

DRC7%

Tanzania7%

Niger6%

Burkina Faso5%

Rest6%

Celtel International Net Profit (2006)

2006

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Table 7: Celtel International Market Shares and Peers

Operations

Active

Customers

(000s)

2006

Market Share

2006

Market Share

2005 Number of Peers Peers’ Brand Names

Burkina Faso 518 57% 56% 2 Telemob, Telecel;

Chad 348 67% 88% 1 Millicom;

Congo B. 683 71% 65% 1 Libertis;

DRC 1,833 49% 50% 4 Vodacom, Supercell, Starcell,

Sait;

Gabon 514 67% 60% 2 Libertis, Telecel;

Kenya 1,939 28% 39% 1 Safaricom;

Madagascar* 331 41% - 2 Orange, Telma;

Malawi 357 61% 64% 1 TNM;

Niger 397 74% 75% 2 Sahelcom, Telecel;

Nigeria** 6,396 23% - 3 MTN, Glomobile, M-Tel;

Sierra Leone 243 56% 58% 3 Millicom, Comium, Africell;

Tanzania 1,517 33% 29% 3 Vodacom, Mobitel, Zantel;

Uganda 470 20% 18% 2 MTN, UTL;

Zambia 1,325 79% 82% 2 Telcel, Zamtel;

* MTC acquired Madacom in December 2005; ** MTC acquired 65% of Nigeria’s V-mobile in May 2006.

Table 8: Celtel International Financial Breakdown (2006)

Operations Revenues

(USD m)

Revenues

Growth

2005-2006

EBITDA

(USD m)

Net Profit

(USD m)

ARPU

(USD)

CAPEX

(USD m)

Burkina Faso 61.2 45% 28 17.4 13 34

Chad 65.4 31% 26.3 6.1 19 30

Congo B. 143.5 56% 56.6 41.7 24 36

DRC 253.2 33% 91 24.1 14 106

Gabon 164.6 44% 88.7 47.6 31 42

Kenya 174.3 11% 51.1 (11.2) 7 38

Madagascar 35.6 - 11.7 6.1 11 14

Malawi 42.2 43% 16.9 3.4 12 26

Niger 61.1 43% 29.4 20.4 16 27

Nigeria* 609.8 - 221 74.6 14 384

Sierra Leone 44.8 2% 13.4 4.6 18 23

Tanzania 169.6 27% 62.9 26.6 12 80

Uganda 39.8 35% 0.2 (15.5) 9 18

Zambia 190.2 111% 84.6 31.3 16 105

* MTC acquired 65% of Nigeria’s V-mobile in May 2006 - all Nigeria financials represent 7 month to December 2006.

2006

18 / 18

About the MTC Group

The MTC Group is a pioneer in mobile telecommunications in the Middle East and on the African continent. The

company was incorporated in 1983 in Kuwait as the region’s first mobile operator and since the initiation of its

“3x3x3” profitable expansion strategy in 2003, it has grown very rapidly becoming the 5th largest

telecommunications company in the world in terms of geographic presence with a footprint in 20 countries.

MTC is a leading mobile operator in 6 Middle Eastern and 14 sub-Saharan African countries with over 12,700

employees, providing a comprehensive range of mobile voice and data services to over 27 million active individual

and business customers (as of December 31, 2006).

The company operates in Kuwait and Bahrain as mtc-vodafone, in Jordan as Fastlink, in Iraq as mtc atheer, in

Lebanon as mtc touch, in Sudan as Mobitel and in 14 sub-Saharan countries in Africa as Celtel: Burkina Faso, Chad,

Democratic Republic of the Congo, Republic of the Congo, Gabon, Kenya, Malawi, Madagascar, Niger, Nigeria,

Sierra Leone, Tanzania, Uganda and Zambia.

In January 2007, MTC launched ACE - an implementation strategy to realize the target of the 3x3x3 vision. ACE

seeks to extract superior value from existing assets through three main thrusts: Accelerating the growth in Africa;

Consolidating the existing assets; and Expanding into adjacent markets.

Based on organic growth and through ACE, MTC’s new goals by the year 2011 are to:

•serve 70 million customers,

•attain a USD 6 billion EBITDA

•reach a market capitalization of USD 30 billion, becoming one of the top 10 mobile operators in the world.

The Parent Company and its subsidiaries (the Group) provide mobile telecommunication services under licenses

from Governments of the countries in which they operate; purchase, deliver, install, manage and maintain mobile

telephone and paging systems; and invest surplus funds in investment securities.

The Group recorded revenues of USD 4.168 billion and net profit of USD 1.050 billion during the year ended

December 31, 2006. The Kuwait Investment Authority owns 24.6% of the company’s shares.

The Mobile Telecommunications Company KSC (the Parent Company) is a Kuwaiti shareholding company and its

shares are traded on the Kuwait Stock Exchange (KSE Ticker: TELE, RIC: TELE.KW; Bloomberg Code: TELE.KK).

The Company’s share price as at March 21, 2007 was 4.900 Fils, giving a Kuwait Stock Exchange market valuation

for MTC of KD 6.182 billion (USD 21.378 billion).

The authorized, issued, and fully paid up share capital of the Parent Company as at December 31, 2006 consists of

1,261,819,591 shares of 100 Fils each.

For more information please visit www.mtctelecom.com

1 USD = KD 0.2896

NOTE: ALL MIDDLE EAST POPULATION AND GDP PER CAPITA FIGURES WERE TAKEN FROM THE ECONOMIST

INTELLIGENCE UNIT (EIU). ALL AFRICA POPULATION AND GDP PER CAPITA FIGURES WERE TAKEN FROM THE CIA

FACTBOOK. THE PENETRATION RATES ARE ESTIMATED AND TAKE INTO CONSIDERATION THE ENTIRE

POPULATION OF A COUNTRY, NOT THE ADDRESSABLE MOBILE POPULATION.

http://www.mtctelecom.com/

mobile telecommunications company k.s.c. 2006 earnings...

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