Ooredoo Group 9M 2017 Results. 30 October 2017

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1 Ooredoo Group 9M October 2017

2 Disclaimer Ooredoo (parent company Ooredoo Q.P.S.C.) and the group of companies which it forms part of ( Ooredoo Group ) cautions investors that certain statements contained in this document state Ooredoo Group management's intentions, hopes, beliefs, expectations, or predictions of the future and, as such, are forward-looking statements. Ooredoo Group management wishes to further caution the reader that forward-looking statements are not historical facts and are only estimates or predictions. Actual results may differ materially from those projected as a result of risks and uncertainties including, but not limited to: Our ability to manage domestic and international growth and maintain a high level of customer service Future sales growth Market acceptance of our product and service offerings Our ability to secure adequate financing or equity capital to fund our operations Network expansion Performance of our network and equipment Our ability to enter into strategic alliances or transactions Cooperation of incumbent local exchange carriers in provisioning lines and interconnecting our equipment Regulatory approval processes Changes in technology Price competition Other market conditions and associated risks This presentation does not constitute an offering of securities or otherwise constitute an invitation or inducement to any person to underwrite, subscribe for or otherwise acquire or dispose of securities in any company within the Ooredoo Group. The Ooredoo Group undertakes no obligation to update publicly or otherwise any forward-looking statements, whether as a result of future events, new information, or otherwise. 9M 2017 Financial 2

3 Contents M 2017 Financial 3

4 Group Key Highlights 9M 2017 Revenue growth in local currency terms across our main markets Revenue stood at QAR 24.5 billion: In local currency terms growth in Indonesia, Oman, Kuwait, Tunisia, Iraq and the Maldives. Excluding Foreign Exchange translation impact, revenues would have increased by 2% compared to the reported 1% revenue increase. Group EBITDA increased to QAR 10.5 billion, EBITDA margin increase to 43%, indicating an improvement in operational performance from 9M 2016 (42%). Excluding Foreign Exchange translation impact, Group EBITDA would have increased by 4% year-on-year. Group Net Profit to Ooredoo shareholders decreased by 15% to QAR 1.6 billion. Excluding foreign exchange impact, net profit attributable to Ooredoo shareholders would have decreased by 8%. Net Profit for 9M 2016 benefitted from significant Foreign Exchange gains of QAR 200 million in However, these temporary gains were reversed in Q government levies in Oman, challenging market conditions in Qatar and unfavourable foreign exchanges rates in Tunisia impacted the Group Net Profit. Group customers increased by 13% YoY to almost 150 million Driven by strong growth in Indonesia, Iraq, Algeria, Tunisia, Oman, Qatar and the Maldives. Group Data revenue share in total revenue reached 45% Strong data growth from consumer and enterprise customers continued: data revenue increased to 45% of Group revenue. Revenue from data contributed QAR 11.1 billion in 9M M 2017 Financial 4

5 Group Revenue and EBITDA Revenue (QARm) EBITDA (QARm) & EBITDA Margin +3% % 0% +1% % % % 41% 42% 43% 9M'14 9M'15 9M'14 9M'15 Positive Revenue and EBITDA trends Revenue up in Indonesia, Oman, Kuwait, Iraq & Maldives, challenging environment in Qatar, Algeria & Myanmar Excluding FX impact Revenue up 2% and EBITDA up 4% Note: All Indosat results as reported adhere to IFRS which may in some instances differ from INDOGAAP 9M 2017 Financial 5

6 Group Net Profit Net Profit Attributable to Ooredoo Shareholders (QARm) Net Foreign Exchange Pre FX Net Profit -15% 2,079 1,758 +4% +2% ,832-27% % 1,559-8% (128) (485) M'14 9M'15 Net Profit in 2016 benefitted from FX related gains, normalized NP is limited to an 8% decrease Government levies in Oman, challenging environment in Qatar and devaluation of Tunisian Dinar 9M 2017 Financial 6

7 Group Net Debt Net Debt (QARm) & Net Debt/EBITDA ratio % +2% % ,3 2,2 2,2 1,8 9M'14 9M'15 Positive trend of lower Group Net Debt continued, Net Debt to EBITDA ratio at 1.8x Lower half of the board guidance between 1.5 and 2.5x (bank covenant 4x) 9M 2017 Financial 7

8 Group Free Cash Flow and Capital Expenditure CAPEX (QARm) & CAPEX/Revenue (%) Free Cash Flow (QARm) % % +17% % % % 25% 23% % 11% 9M'14 9M'15 9M'14 9M'15 Free Cash Flow improvement supported by lower CAPEX Investment into network continued to maintain strong competitive position Note: Free cash flow = Net profit plus depreciation and amortization less Capex; Capex excludes license fee obligations; Net profit adjusted for extraordinary items. 9M 2017 Financial 8

9 Group Total Customers Total Customers (000) +13% +16% 149, % M'14 9M'15 Solid customer growth continued driven by Indonesia, Iraq, Algeria, Tunisia, Oman, Qatar and the Maldives Almost 17 million net new customers gained YoY 9M 2017 Financial 9

10 Group M performance summary QAR Billion 9M 2017 % Change 9M 2017 / 9M Annual Guidance Consolidated Revenue % -1% to +2% EBITDA % 0% to +3% Capital Expenditure % 5.5 bn to 6.5 bn Revenue on the upper side of full year Guidance EBITDA better than forecasted, Capex traditionally highest in Q4 9M 2017 Financial 10

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12 Group Qatar QARm Revenue -2% Ooredoo Qatar Strong market leadership position maintained Ooredoo s mobile and fixed line networks ranked among the fastest globally Customer numbers increased by +3% yoy to reach 3.5 million Less international visitors during Eid holidays in August negatively impacting revenue (-2%) and EBITDA (-3%) EBITDA & Margin -3% ,958 51% 51% Good contribution from Ooredoo TV segment (4K Entertainment) New promotions: Qatarna Pack (unlimited local calls, local & roaming data) 50 Mbps fibre plan (double speed) Ooredoo Fibre rollout programme more than 500k homes passed, 347k homes connected 1 US$ = Qatari Riyal (QAR) 1 Note: (1) Constant -pegged currency 9M 2017 Financial 12

13 Group Indonesia QARm Indosat Ooredoo Revenue +5% EBITDA & Margin +6% Strong revenue growth and gross margin improvement resulted in better EBITDA margin Customer number increased by 19% (yoy) to reach 97 million 46% 47% Competition in mobile intensified during Q3 17 Strong data revenue growth yoy driven by both mobile and fixed Revenue IDRbn 1 EBITDA & Margin 4G coverage reached 175 cities in Indonesia covering 32% population +5% +6% % 47% 1 US$ = 13,329 Indonesia Rupiah (IDR) 2 Note: ((1) As per IFRS; (2) Nine month average rate January September 9M 2017 Financial 13

14 Group Iraq QARm Asiacell Revenue +6% Solid growth in revenue, EBITDA and customer numbers in Customer base increased to 12.5 million as of September 2017 (up by 11%) driven by business returning business to newly liberated areas Tight cost control continues EBITDA & Margin +2% % 45% 9M 2017 Financial 14

15 Group Oman QARm Revenue +1% Ooredoo Oman Mobile and fixed data driving increase in overall revenue Customer growth continued in all segments with an increase of 4% YoY to 3 million Bottom line results were impacted by increase in royalty fee from 7% to 12% and an increase in income tax rate from 12% to 15% EBITDA & Margin -0.3% Process for third licenses issuance cancelled by Omani government, new focus on a license between local investment fund and a selected global strategic partner 54% 53% 1 US$ = Omani Rial (OMR) 1 Note: Note: (1) Constant- pegged currency 9M 2017 Financial 15

16 Group Kuwait QARm Ooredoo Kuwait Revenue +7% EBITDA & Margin +9% Fierce competition and challenging economic situation continues in Kuwait, declining customer base in the market Increase in revenue driven by higher non-recurring revenue Revenue +8% KWDm 24% 25% EBITDA & Margin +10% Customer number stood at 2.3 million Successful launch of iphone 8, high market interest for an attractive offer Cost efficiency program in place Network upgrade is progressing ahead of the planned target 24% 25% 1 US$ = Kuwait Dinar 1 Note: (1) Nine month average rate January September 9M 2017 Financial 16

17 Group Algeria QARm Ooredoo Algeria Revenue -7% EBITDA & Margin +15% Ooredoo Algeria grew further revenue market share despite challenging market conditions and fierce price competition % % Revenue impacted by increased VAT and challenging economic environment Data revenue sustained growth Customer number up by 5% to reach 14.2 million Revenue DZDm EBITDA & Margin Ongoing cost optimization efforts and declining handsets subsidies to offset overall revenue market decline resulting in improved EBITDA margin -7% % % 46% 1 US$ = Algerian Dinar (DZD) 1 Note: (1) Nine month average rate January September 9M 2017 Financial 17

18 Group Tunisia QARm Ooredoo Tunisia Revenue -11% EBITDA & Margin Against a backdrop of slow economic growth and local currency devaluation (12%), Ooredoo Tunisia grew revenue and EBITDA in local currency terms % 455 Customers number reached 8.3 million, an increase of 6% yoy 39% 40% Data revenue offsets the revenue loss in voice Fixed revenue shows further positive growth Revenue +2% TNDm EBITDA & Margin Cost optimization program materialized further savings % % 40% 1 USD = Tunisian Dinar (TND) 1 Note: (1) Nine month average rate January September 9M 2017 Financial 18

19 Group Myanmar QARm Ooredoo Myanmar Revenue -13% 961 EBITDA & Margin Despite challenging market conditions, Ooredoo Myanmar recorded strong recurring revenue growth yoy in local currency terms, impacted by currency depreciation (down 9%) 93 Mobile data segment continues growth, driven by data bundles and higher smartphone penetration -7-1% 10% Adjustment for inactive subscribers lead to a 12% decrease in customer base serving 7.7 million customers Revenue -3% MMK Bn EBITDA 34 Gained revenue market share sequentially in a highly competitive market Delivered double digit EBITDA margin in the quarter for the first time since inception, driven mainly from gross margin improvement and lower OPEX intensity -2-1% 10% Launched mobile money services branded M-Pitesan (M-Cash) 9M 2017 Financial 19

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21 Group Revenue and EBITDA Breakdown Revenue (QARm) EBITDA (QARm) 24,839 24,196 24,266 24,476 10,234 10,012 10,156 10,459 9M'14 9M'15 Qatar Indonesia Iraq Kuwait Algeria Tunisia Oman Myanmar Others M'14 9M'15 Qatar Indonesia Iraq Kuwait Algeria Tunisia Oman Myanmar (251) (30) (7) 93 Others (316) (308) (132) (168) 9M 2017 Financial 21

22 Group CAPEX and Customers Breakdown CAPEX Breakdown (%) Customers Breakdown (%) Myanmar 10% Others 7% Qatar 21% Tunisia 6% Others 1% Qatar 2% Iraq 8% Tunisia 4% Algeria 7% Kuwait 6% Iraq 8% Myanmar 5% Algeria 9% Kuwait 2% Oman 2% Oman 11% Indonesia 26% Indonesia 65% 9M 2017 CAPEX = QAR 2,607 m 9M 2017 Total Customers = 150 m 9M 2017 Financial 22

23 Group Total Group Debt Breakdown Short Term Long Term Total Group Debt (QARm) Total Group Debt Breakdown (as of September 30, 2017) 42, ,781 45, , Indonesia 12% Others 9% Qatar 79% 9M'14 9M'15 Temporary increase in Group debt in 2016 due to prefunding of USD 1 Billion Bond, repaid on 14th October 2016 Group debt mainly at Corporate level Note: Includes Ooredoo International Finance Limited and Ooredoo Tamweel Limited 9M 2017 Financial 23

24 Group Debt Profile Ooredoo QPSC level Loans 750 Bonds Sukuk Loan Type (in USD mn) Amount Usage Rate* Maturity Bonds/Sukuk (in USD mn) Issue Amount Interest/ Profit Rate Maturity Listed in QAR3bn RCF QAR Money Market 31 Jan 2018 USD1bn RCF 1,000 1,000 Libor + 100bps 17 May 2019 USD 500mn RCF Libor + 88bps 06 May 2020 USD150mn Term Loan Libor + 90bps 31 Aug 2020 USD1bn RCF 1, Libor+ 140bps 07 Jun 2022 Fixed Rate Bonds due % 10 Jun 2019 LSE Fixed Rate Bonds due , % 16 Feb 2021 LSE Fixed Rate Bonds due , % 21 Feb 2023 ISE Fixed Rate Bonds due % 19 Oct 2025 LSE Fixed Rate Bonds due % 22 Jun 2026 ISE Fixed Rate Bonds due % 31 Jan 2028 ISE Fixed Rate Bonds due % 31 Jan 2043 ISE Total Loans 3,474 m 2,650 m Total Bonds and Sukuk 6,100 m Sukuk due , % 03 Dec 2018 ISE Total outstanding debt as at 30 September, 2017 at Ooredoo QPSC level USD 8,750 million * Fully drawn basis Long term debt profile is well balanced 24

25 Group Breakdown Blended ARPU Qatar (QAR) Iraq (QAR) Oman (QAR) Maldives (QAR) Palestine (QAR) 119,8 126,7 120,9 116,6 115,7 108,1 31,4 32,2 30,3 29,0 30,4 31,2 67,0 66,8 66,6 62,4 60,0 63,3 51,9 52,5 48,6 54,9 56,7 55,4 30,6 30,2 27,2 26,7 28,8 29,7 Indonesia (QAR) Kuwait (QAR) Tunisia (QAR) Algeria (QAR) Myanmar (QAR) 6,9 6,6 6,7 5,8 5,9 5,6 67,8 65,5 66,5 63,6 65,3 66,7 15,7 15,6 14,0 12,9 12,5 13,8 21,9 23,3 21,2 20,3 20,2 20,8 15,4 13,7 12,2 11,3 11,1 14,2 Indonesia (IDR) Kuwait (KWD) Tunisia (TND) Algeria (DZD) Myanmar (MMK) ,6 5,4 5,6 5,3 5,4 5,6 8,9 9,4 8,7 8,1 8,4 9,

26 Statutory Corporate Tax Rates Statutory Tax Rate Losses C/Fwd Allowed Notes Algeria 26% 4 years Indonesia 25% 5 years Iraq 15% 5 years Kuwait 15% 3 years GCC companies (including NMTC)are exempted and are subjected to 4.5% Zakat, KFAS & national Labour Support Tax on consolidated profits Maldives 15% 5 years Myanmar 25% 3 years Oman 15% 5 years Palestine 20% 5 years Qatar 10% 3 years Qatari/GCC owned companies and companies listed on Qatar Exchange are exempt Singapore 17% Indefinitely Tunisia 35% 5 years 1) 25% is the standard tax rate; 2) 35% tax rate applies to oil companies, banks, financial institutions including insurance companies and telecommunication companies 26

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