Wrap Text
Summarised consolidated financial results
for the year ended 31 December 2013
MTN Group Limited
(Incorporated in the Republic of South Africa)
Registration number 1994/009584/06
Share code: MTN
ISIN code: ZAE000042164
(“The MTN Group”, “MTN” or “the Group”)
Summarised consolidated financial results
for the year ended 31 December 2013
MTN is a leading emerging markets mobile operator, connecting 207,8 million people in 22 countries
across Africa and the Middle East. We are committed to continuously improving our customers'
experience and delivering a bold, new Digital World to them.
Highlights
• Group subscribers increased 9,8% to 207,8 million
• Revenue increased 12,0% (3,1%*) to R136 495 million
• Data revenue increased 41,4% (32,6%*) to R20 670 million
• EBITDA increased 13,0%**(1,6%*) to R58 820 million
• EBITDA margin increased 0,4 percentage points to 43,1%**
• Capex increased 4,6% (-4,3%*) to R30 164 million
• HEPS increased 27,3% to 1 386 cents
• Final dividend of 665 cents per share, with total dividend of 1 035 cents per share
* Constant currency information disclosed in these results is the responsibility of the Group’s
board of directors. The constant currency information has been presented to illustrate the impact of
changes in currency rates on the Group’s results and hence may not fairly present the Group’s results
of operations. In determining the change in constant currency terms, the current financial
reporting year’s results have been adjusted to the prior year’s average exchange rates determined as
the average of the monthly exchange rates which can be found on www.mtn.com/investors. The measurement
has been performed for each of the Group’s currencies, materially being that of the US dollar and
Nigerian naira. The organic growth percentage has been calculated by utilising the constant currency
results compared to the prior year results. The constant currency information has been reported on in
terms of ISAE 3000 (Assurance Engagements other than reviews of historical financial information) by
the Group’s external auditors.
**excluding tower profits of R968 million (December 2012: R587 million)
OVERVIEW
During the year, MTN Group delivered satisfactory growth in headline earnings, supported by
favourable currency movements. The Group faced a number of challenges, including aggressive price
competition and increased regulatory pressures in many of our key markets.
Group subscribers increased by 9,8% to 207,8 million, notwithstanding ongoing subscriber
registration programmes in a number of markets. Subscriber growth was supported by competitive segmented
offerings and improved network quality and capacity in many markets.
The efficient execution of our extensive capital expenditure (capex) programme significantly
improved network quality and capacity, and facilitated higher voice and data traffic. This investment
in capacity will also ensure that MTN remains competitive and is able to roll out solutions beyond
traditional voice services.
Group reported revenue increased by 12,0% in the year. This was positively impacted by a weakening
of the rand against a number of currencies in which our businesses operate. For the year as a
whole, the rand declined by 18,3% on average against the US dollar. On a constant currency basis,
revenue increased by a more muted 3,1%*. This was largely the result of a 6,1% decline in revenue in
MTN South Africa and 5,7%* growth in MTN Nigeria. Both our Large and Small opco clusters delivered
more pleasing results with revenue growth of 11,0%* and 7,5%* respectively, with particularly
encouraging growth reported by our operations in Uganda, Ghana, Cameroon, Sudan, Yemen and Zambia.
Our Nigerian operation continued to improve its performance during the year, with fourth quarter
revenue up 15,3% year-on-year (YoY) in local currency. Notwithstanding the challenges faced by our
South African operation, the business showed signs of improved performance in the second half.
Group EBITDA increased by 13,0% (1,6%*) to R58 820 million excluding the profit from the sale of
towers. Further progress was made on cost optimisation across the Group, which supported the EBITDA
margin of 43,1%** for the year, 0,4 percentage points higher than the previous year. The good
progress made on cost savings was offset to an extent by the lower EBITDA margin in the South African
operation, which was largely driven by the decline in revenue.
Capital expenditure for the year was R30 164 million, 4,6% higher than the previous year.
Excluding the effect of changes in foreign exchange movements, capex decreased by 4,3%*. During 2013,
the Group’s operations rolled out 5 161 2G and 4 413 3G sites, supporting increased minutes of use
(MOU) and faster data speeds on our 3G networks.
During the year under review, the Group adopted IFRS 11 Joint Arrangements for the first time and
accounted for MTN’s investment in MTN Irancell in terms of IAS 29 - Financial Reporting in
Hyperinflationary Economies. The Group also reclassified its intergroup loan to MTN Syria as a net
investment in a foreign operation in accordance with the principles of IAS 21 -The Effect of Changes
in Foreign Exchange Rates.
PROSPECTS
Notwithstanding the muted constant currency growth reported for the full year, MTN has made sound
progress over the last six months. The large investment in capex during the year has significantly
addressed both network quality and capacity, which will be key factors supporting continued growth
over the medium term.
While the South African business delivered disappointing results, the executive team is focused on
helping this business deliver an improved overall performance in the year ahead.
We continue to explore opportunities to expand our product offering outside of traditional voice
and expect to increase our presence in the digital space by leveraging technology and maximising the
opportunity of low internet penetration in our markets. Delivering additional services through the
internet will be supported by our recent partnership with Rocket Internet (Rocket), which is expected
to be concluded in the first half of 2014. This will enhance growth in our internet business in
Africa and the Middle East as Rocket is one of the world’s leading internet incubators, with a
presence across our footprint. Expanding our 3G coverage and enabling access to affordable
data-enabled devices is anticipated to support strong growth in data usage. The continued roll out
of MTN Mobile Money and broader financial services, as well as providing innovative ICT solutions
to corporate and SME customers through our enterprise business unit, remain a key priority.
The Group is focused on delivering a distinct customer experience by improving network quality and
capacity as well as providing value-added products targeted at our different customer segments. We
continue to transform our organisation through cost optimisation and increasing operational
efficiency which will help the delivery of sustainable returns for all our stakeholders.
Value-accretive M&A opportunities will continue to be explored in line with our strategy.
Any forward-looking information contained in this announcement has not been reviewed or reported
on by the Company’s external auditors.
SANCTIONS
MTN continues to work closely with all relevant authorities in managing US and EU sanctions
against Iran, Syria and Sudan. MTN continues to retain international legal advisors to assist the
Group in remaining compliant with all applicable sanctions. In particular, we will focus on the
segregation of funds to ensure continued compliance with both internal and external requirements.
TURKCELL ALLEGATIONS
In November, Turkcell Iletisim Hizmetleri AS (Turkcell) filed a lawsuit against MTN, MTN
International (MTNI) and others in the South Gauteng High Court of South Africa, seeking damages of
approximately US$4.2 billion plus interest. Its claim arose from substantially the same allegations
on which it founded US proceedings against MTN in early 2012. Those were related to Turkcell
subsidiary East Asian Consortium’s (EAC) unsuccessful effort to obtain the second GSM licence in
Iran during 2005.
Turkcell had withdrawn its claims in the US proceedings on 1 May 2013. Turkcell’s allegations were
investigated by a special committee appointed by the MTN board (the Hoffmann Committee) and its
findings reported by MTN to stakeholders in February 2013. After a thorough examination of Turkcell’s
allegations and consideration of the available evidence, the Hoffmann Committee concluded that the
allegations were unfounded. MTN will continue to vigorously defend any proceedings instituted by
Turkcell in respect of such matters.
LEADING THE DELIVERY OF A “BOLD NEW DIGITAL WORLD”
We continue working towards our vision to lead the delivery of a “bold, new Digital World” to our
customers and made good progress in the execution of our strategy in 2013. Over the medium term, our
priorities are driving growth beyond voice, creating a distinct customer experience while ensuring
that we optimise costs.
During the year, we delivered on a number of initiatives towards achieving this.
Voice revenue contributed three-quarters (75,5%) of total revenue. In the year, voice continued to
face pressure as a result of aggressive price competition and lower mobile termination rates, which
caused a decrease of 1,8 percentage points in its contribution to overall revenue. MTN remained
competitive and maintained its market share in most key markets by improving the quality and
capacity of its network.
We recorded progress in customer service, improving our net promoter score by 28% in countries
where it has been rolled out. The net promoter score is the result of a customer satisfaction survey
implemented in South Africa, Nigeria, Ghana, Cameroon and Ivory Coast in the year. MTN’s segmented
offerings as well as value-added products and services remain priorities going forward.
During the year, data services were the key driver of the Group’s revenue growth and increased
their contribution by 3,1 percentage points to 15,1%. The number of data users increased by 37,4% to
80,6 million as we expanded our 3G networks and stimulated the adoption of data-enabled devices and
smartphones. At the end of December we had 34,8 million smartphones on our network, an increase of
59,0% on the previous year. We expect the recent launch of our own affordable “Steppa” smartphone to
quicken the pace of smartphone penetration. Managing tariffs in the data environment remains a key
focus.
MTN Mobile Money and financial services are an increasingly important part of our service
offering. We are not only working on acquiring subscribers but also on increasing the volume of
transactions through expanding our product range. In 2013, MTN introduced numerous financial
products such as various short-term insurance offerings, ATM withdrawals and remote payments for
airline tickets. The number of registered MTN Mobile Money subscribers grew by 57,3% to 14,8 million.
However, growth in the active subscriber base was slower than expected, due in part to regulatory
and operational challenges. This is an area of management attention in 2014.
To accelerate MTN’s expansion into the digital space, we entered into a partnership with Rocket.
Our partnership will be effected through two separate agreements. Firstly, we have an equity
partnership agreement with Rocket and Millicom International Cellular to develop our internet
businesses in Africa, being one third shareholders each through Africa Internet Holding (AIH),
which already has a presence in 13 countries on the continent. The second agreement involves Rocket
and MTN becoming 50% shareholders in Middle East Internet Holding (MEIH). MTN expects to invest
approximately EUR300 million over the next two to four years in AIH and MEIH.
We continue to leverage our integrated ICT business, which is still in its infancy and is
envisaged to increase its contribution going forward. During 2013, we secured two large multinational
contracts in Africa and a partnership with PCCW, owners of one of the world’s largest IP backbones,
which will allow us to enhance our expanding ICT offering in Africa. We also provide cloud services
to SME customers in seven markets and high-speed networks in 11 markets.
In the year, we made solid progress on cost optimisation across the Group. This supports the
increase in our EBITDA margin to 43,1%**. However, as the telecommunications environment continues to
evolve towards data and as competition intensifies further, our returns will come under pressure. It
is therefore imperative that we embed cost optimisation and efficiencies into the business to ensure
we have the most effective base for future growth.
A number of initiatives have already resulted in real cost benefits. In 2013 we started the
process to establish a global hub for centralised transaction processing in South Africa and standardised
processes across support functions. Centralising procurement continues to realise gains with the
establishment of a procurement company in Dubai and the development of a blueprint for the supply chain
management processes across the Group. We realised meaningful cost reductions in our distribution network
through the renegotiation of contacts in South Africa and the realignment of our commission structure
in Nigeria.
The Group continues to explore tower transactions on an ongoing basis. In the year, MTN sold
towers in Cameroon and Ivory Coast and entered into agreements to sell towers in Rwanda and Zambia.
We anticipate that these agreements will close in the first half of 2014. Other steps taken to manage
costs included optimising labour productivity costs and a continued focus on power costs. Land leasing
costs and high inflation in key markets remain challenging.
FINANCIAL REVIEW
REVENUE
Group revenue increased by 12,0% (3,1%*) to R136 495 million. This was supported by strong growth
in the Large opco cluster 13,7% (11,0%*), supported by Uganda 35,5% (17,8%*), Ghana 20,5% (13,0%*),
Cameroon 36,5% (11,9%*) and Sudan 15,7% (34,5%*). The South African and Nigerian operations reported
revenue growth of -6,1% and 24,5% (5,7%*) respectively. The Small opco cluster performed well,
increasing revenue by 25,8% (7,5%*). This was supported by strong growth in Zambia 51,0% (33,4%*)
and Yemen 31,6% (11,1%*).
The weakness in the rand exchange rate in the year contributed to the improvement in reported
revenue for operations outside South Africa. More specifically, the rand declined by 15,6% against
the naira, while the naira remained relatively constant against the US dollar.
Outgoing voice revenue increased by 12,3% (2,4%*) compared to the prior year and contributed 64,2%
of total revenue. Performance was negatively impacted by price competition in key markets. In 2013,
the average price per minute (APPM) declined by 14,9% in US dollar terms. These lower voice tariffs
resulted in a 19,0% increase in MTN’s voice traffic volumes YoY. We expect to see APPM declining
further in 2014.
Group data revenue (excluding SMS) increased by 41,4% (32,6%*), supported by an expanded 3G
network, strong growth in data users and an increase in smartphone adoption. Data’s contribution to
total revenue was 15,1%, 3,1 percentage points higher than the prior year. South Africa and Nigeria
were the largest contributors to data revenue growth and together accounted for 77,9% of the Group’s
total data revenue. Other strong operations included Ghana, Uganda, Cameroon, Ivory Coast and Syria.
Group interconnect revenue declined by 4,4% (12,9%*) following a cut in termination rates in our
Nigerian and South African operations. These two operations accounted for 52,0% of total Group
interconnect revenue. The 24,9% decline in South Africa interconnect revenue and the 23,0%* decrease
in Nigerian interconnect revenue resulted in a 6,5 percentage point decline in the Group’s
interconnect margin to 17,7%.
EBITDA
Group earnings before interest, taxation, depreciation and amortisation (EBITDA) increased by
13,0%(1,6%*) to R58 820 million, excluding the profit on tower sales. The Group EBITDA margin
increased marginally by 0,4 percentage point to 43,1%**, despite lower margins in South Africa and
Nigeria (excluding the reversal of the provision of management fees). Progress was made in reducing
advertising and transmission costs but these gains were offset by higher rent and utility costs as
well as increased interconnect costs.
The slight widening in the Group’s EBITDA margin was supported by increased margins in Ghana
(0,5pp), Ivory Coast (0,6pp), Sudan (4,0pp), Yemen (2,7pp) and Zambia (13,2pp). However, South Africa,
Nigeria (excluding the reversal of the provision of the management fees), Syria, Cameroon and Uganda
recorded declines in their EBITDA margins.
DEPRECIATION AND AMORTISATION
Depreciation increased by 19,3% as a result of the significant capex roll out in South Africa and
Nigeria. Amortisation costs increased by 30,5%, driven by increased spending on software.
NET FINANCE COSTS
Net finance costs of R1 234 million were 67,4% below the R3 790 million in the previous year. This
was largely due to foreign currency gains of R1 066 million as a result of R2 226 million in
functional currency gains in Mauritius, partly offset by foreign exchange losses incurred on the Sudan
working capital accounts of R778 million. The increase in interest costs was largely due to the higher
debt levels in Nigeria as the business invested in its capex programme.
TAXATION
The Group’s absolute taxation charge increased by 4,0% to R12 307 million and the effective tax
rate declined by 4,2 percentage points to 28,8%. The lower effective tax rate was mainly the result
of the discontinuance of secondary tax on companies (STC) in South Africa and the IAS 21 adjustment
on foreign exchange losses.
EARNINGS
Basic headline earnings per share (HEPS) increased by 27,3% to 1 386 cents and attributable
earnings per share (EPS) increased by 27,4% to 1 434 cents.
CASHFLOW
Cash inflows from operating activities increased by 34,7% to R27 025 million mainly due to a 16,8%
increase in cash generated from operations and a 16,6% decrease in tax payments. Cash outflows on
property, plant and equipment (excluding software) increased by 18,5% to R24 568 million, which
contributed significantly to the cash outflow in investing activities. This was partially offset by
the proceeds from the sale of the towers of R2 378 million. Cash inflows from financing activities
were mainly the result of an increase in borrowings in Nigeria. Cash and cash equivalents increased
to R39 577 million due to the net cash inflow and the positive effect of the weaker rand/US dollar
exchange rate.
CAPITAL EXPENDITURE
Capex increased by 4,6% (-4,3%*) to R30 164 million, of which R2 563 million related to foreign
currency movements. In 2013, we accelerated infrastructure investment to support the improvement
of our network quality and capacity.
CASH BALANCE
The Group reported net debt of R352 million. This excludes R5 518 million (49%) of net cash in MTN
Irancell that is now accounted for on an equity basis.
CHANGES IN OWNERSHIP
During the year under review, the following changes in shareholding occurred:
• The Group concluded the acquisition of the remaining 50% equity interest in MTN Cyprus, which
is now a wholly owned subsidiary of MTN Dubai;
• The Group decreased its shareholding in MTN Côte d’Ivoire SA from 67,67% to 66,83%;
• The Group increased its shareholding in the Mauritian internet service provider Satalite Data
Networks Mauritius Proprietary Limited from 60% to 100%; and
• The Group increased its shareholding in MTN Afghanistan from 90.5% to 100%
OPERATIONAL REVIEW
SOUTH AFRICA
• Reported revenue declined by 6,1%, impacted by reviewed accounting treatment adjustment
• Excluding the impact of the adjustment, revenue decreased 1,6%
• Interconnect revenue down 24,9%
• Data revenue increased 20,2%
• EBITDA margin declined 0,3 percentage points to 33,8%
Although there is still much work to be done, MTN South Africa started to show some progress
during the second half of the year after a challenging start to 2013. This improvement was largely a
result of more relevant segmented offerings to the pre-paid segment, particularly the revised MTN Zone
offering. An international calling campaign offering cheaper calls to other African countries and the
discontinuation of value-eroding offers were also key contributors. The pre-paid subscriber base
declined by 1,1%, bringing the total pre-paid base to 20,7 million subscribers. Most of the subscriber
loss reported earlier in the year was recovered in the second half. The post-paid segment performed
well, increasing its subscriber base by 11,3% to 5,0 million. MTN South Africa recorded an increase
in the number of upgrades to higher tariff plans.
Total revenue declined by 6,1% to R39 708 million. This was impacted by a R1 888 million
adjustment made to revenue as a result of management reviewing the accounting treatment for handset
sales.Excluding this adjustment, revenue declined by 1,6% (including MTN Business). This was mainly
a result of lower outgoing voice revenue, which declined by 8,3% to R19 327 million. Data revenue,
including MTN Business, increased by 20,2% to R8 822 million and contributed 22,2% to total revenue.
This was a positive result despite lower data pricing. Increased 3G coverage, improved smartphone
adoption and competitive data bundles were the main contributors to this growth. The number of
smartphones on MTN’s network increased by 32,6% to 7,3 million, and the number of data users increased
by 6,4% to 14,3 million.
The EBITDA margin declined by 1,8 percentage points excluding the impact of the handset sales
adjustment and 0,3 percentage points including the impact of the adjustment. This decline was largely
as a result of lower revenue growth. While cost increases in 2013 were kept to below the inflation
rate, cost optimisation and labour productivity remains a priority. In December, MTN South Africa
reduced the number of employees given its increased focus on aligning costs with revenue. The cost
structures of the business will continue to be reviewed in 2014.
Capex for the period amounted to R5 835 million, which mainly related to improving quality and
capacity on 2G and 3G networks. During the year, we added 516 new 2G sites and 1 133 co-located 3G
sites. The 3G population coverage improved sharply and is now 75,8%.
We continue to have discussions with the authorities regarding the planned auction of 2.6 GHz and
3.5 GHz spectrum frequency and allocations.
On 29 January 2014, the Independent Communications Authority of South Africa (ICASA) announced its
final decision regarding the initial proposal to reduce mobile termination rates. MTN does not
believe this is in accordance with the cost-based approach set out in the Electronic Communications
Act and has taken legal action against ICASA contesting the approach used.
NIGERIA
• Net subscriber additions of 9,3 million
• Revenue increased 5,7%*
• Interconnect revenue down 23,0%*
• EBITDA margin decreased 2,9 percentage points to 55,4% (excluding the reversal of prior year
management fees provision)
• Capex of R14 298 million, with 2 743 new 2G sites and 1 607 co-located 3G sites added
MTN Nigeria grew its subscriber base by 19,7% in 2013, bringing total subscribers to 56,8 million
at the end of December. This was a notable turnaround in the face of aggressive competition and a
difficult operating environment. The strong growth was driven by improved segmented offerings to
customers, a better quality network, and was supported by seasonal promotions aimed at growing
subscribers and increasing usage.
Total revenue increased by 5,7%*. Revenue growth was dampened by interconnect revenue, which
declined by 23,0%* following a 40% reduction in mobile termination rates at the beginning of the year
and a lower effective tariff. The effective tariff declined by more than 30,0% in the year. Fourth
quarter revenue showed encouraging growth, ahead of expectations, increasing by 15,3% in local
currency terms over the comparable prior year quarter. This follows the mandatory subscriber
registration disconnections, the reconnection of service in the three northern states and the lifting
of the promotions ban which hampered revenue in the first half of the year.
Data revenue increased by 26,3%* and now contributes 15,1% to total revenue. This growth was
driven mainly by innovative local content and attractive data bundles, but was limited by slow speeds
resulting from the high volume of traffic on MTN’s 3G network. The number of active smartphones on the
network increased by 63,1% to 6,2 million at the end of December.
The EBITDA margin (excluding the reversal of prior year management fees provision) declined by 2,9
(3,2*) percentage points to 55,4% as a result of slower revenue growth. Assuming no management fees
or other prior year adjustments, the underlying EBITDA margin was 57,0%. The operation performed
well on cost-optimisation initiatives, reporting subdued opex growth. We realised cost savings in many
areas, including marketing and the revised commission structure implemented during the year.Reported
EBITDA increased by 29,7% mainly due to the reversal of the management fee provision. The current year
reversal of management fee provisions related to prior periods amounted to R1 778 million, while the
management fee expense for 2013 was R758 million.
Capital expenditure for the year increased to R14 298 million and was aimed at significantly
improving the quality and capacity of the network. The network KPIs set out by the Nigerian
Communications Commission were achieved at the end of December 2013. During the year, MTN Nigeria
rolled out 2 743 new 2G sites and 1 607 co-located 3G sites. The company is fully committed to ensuring
that the quality and capacity of the network remains at the appropriate standards.
LARGE OPCO CLUSTER
• Subscribers increased 7,1% to 93,4 million
• Revenue 11,0%* higher
• Data revenue increased 72,7%*
• EBITDA margin expanded 1,1 percentage points to 36,1%
MTN Irancell delivered a satisfactory performance, increasing its subscriber base by 2,2% to
41,4 million. This subdued growth was mainly the result of high levels of mobile penetration and
increased competition. The delay in the approval of a new number range and a weaker economy further
impacted growth in net additions.
The numbers below exclude the adjustment made for hyperinflation:
Total revenue increased by 18,3%* compared to the prior year. Outgoing voice revenue grew by
15,8%*, driven by a 5,3% increase in MOU with a marginal decline in the effective voice tariff. SMS
and data revenue continued to show good growth, increasing by 18,0%* and 60,2%* respectively. Data
revenue now contributes 10,3% of total revenue despite the operation not having a 3G licence. At the
end of December, MTN Irancell had 10,3 million active smartphones on its network and 11,7 million data
users. SMS revenue contributed 21,2% to total revenue. The number of WiMax subscribers increased by
14,3% to 339 809 at the end of December.
MTN Irancell’s EBITDA margin declined by 1,4 (1,1*) percentage points to 42,8%, largely impacted
by foreign currency denominated costs following the depreciation of the Iranian rial and an increase
in international interconnect costs. In an effort to limit this impact going forward, MTN Irancell
has renegotiated some contract terms with key vendors to mitigate the impact of costs denominated in
foreign currency. During the year, the operation did well in maintaining cost increases at below the
rate of inflation.
MTN Irancell invested R1 758 million of capex during the year. It rolled out 746 new 2G sites and
415 km of fibre, improving the quality and capacity of the network.
MTN Ghana increased subscribers by 10,2% to 12,9 million. This was a good performance in the light
of a very competitive market and high levels of penetration. MTN Ghana’s performance was driven by
increased regional segmentation, acquisition and retention campaigns and a focus on MTN Mobile
Money.
Total revenue increased by 13,0%*, supported by the 81,6%* growth in data revenue. Data
contributed 9,7% to total revenue, underpinned by a 20,9% increase in data users to 4,9 million. Outgoing
voice revenue increased by 7,0%*. Total revenue was impacted by lower incoming voice revenue due to reduced
incoming international traffic on the network.
MTN Ghana’s EBITDA margin expanded by 0,5 (0,5*) percentage points to 37,5%, supported by cost
savings across various areas of the business, notably on marketing and maintenance costs.
MTN Cameroon delivered a strong performance, increasing its subscriber base by 19,2% to 8,7
million at the end of December 2013. This was supported by promotional offerings to segmented groups
and increased penetration levels across the countries regions. During the year, MTN launched five
new service centres, improving product availability and customer service.
Total revenue grew by 11,9%* despite slow economic growth and increased competition. This
performance was achieved as a result of strong expansion in data revenue, which increased by 68,3%*
and contributed 6,4% to total revenue. The growth in data was, however, constrained by MTN Cameroon
not having a 3G licence. MTN’s attractive data bundles and value-added services such as MTN Play and
Magic Voice were the main contributors to growth in data revenue. Voice revenue increased by 7,7%*
despite a 39,4% decline in the effective tariff. MOU increased marginally relative to the decline in
the effective tariff. Interconnect revenue also contributed to total revenue, increasing by 13,1%*.
The number of registered MTN Mobile Money subscribers at the end of December was 1,4 million.
Activation of subscribers as well as the roll out of a merchant network remains a priority.
MTN Cameroon’s EBITDA margin, excluding profit from the sale of towers, decreased by 3,3 (3,3*)
percentage points to 42,6% largely as a result of higher lease rental costs following the tower
transaction. Including the tower profit, the EBITDA margin increased to 49,0%.
Capex amounted to R768 million. During the year, 191 2G sites were rolled out and improvements to
quality and capacity were made to high traffic sites in the main cities.
MTN Ivory Coast performed well in an economy that is starting to show signs of recovery.
Subscribers grew by 16,4% to 7,1 million despite aggressive competition. This was driven by effective
churn management programmes, which have reduced churn rates to below 3% per month.
Total revenue increased by 9,1%*, supported by a 158,9%* growth in data revenue and a 16,0%*
increase in interconnect revenue. Affordable 3G handsets and value-added services accelerated this
growth trend. There are currently 1,8 million smartphones on the network and this number is expected
to grow further with the introduction of cheaper smartphones into the market. Voice revenue grew by
2,1%* due to lower MOU and despite a decline in the effective tariff.
MTN Mobile Money started gaining momentum with an increase of 59,0% to 1,5 million registered
subscribers at the end of December. The distribution network now has more than 3 000 merchants with
a focus on expanding the rural footprint.
The operation’s EBITDA margin excluding profits on tower sales rose by 0,6 (0,5*) of a percentage
point to 40,9%, helped by notable savings made on network and marketing costs.
MTN Ivory Coast spent R830 million on its capex programme, rolling out 92 new 2G sites and 84
co-located 3G sites in the year.
MTN Uganda delivered a good performance, increasing its subscriber base by 14,4% to 8,8 million,
driven by strong acquisition promotions, segmented offerings and the continued success of MTN Zone.
Increased penetration into rural areas and improved network quality further supported this growth.
Total revenue increased by 17,9%*, supported by a 51,7%* increase in data revenue and a 10,9%*
increase in outgoing voice revenue. SMS revenue declined by 3,5%* as customers opted for newer
data-driven social media platforms for communication. Data trends were supported by an expanded
3G network, value-added services and enhanced marketing.
MTN Mobile Money continued to perform well and recorded a 47,0% increase in registered subscribers
to 5,2 million with more than 25 million transactions per month. Usage was stimulated by a wider
mobile payment product range.
MTN Uganda’s EBITDA margin declined by 0,5 (0,5*) percentage points to 35,9%, excluding the
profit from the sales of towers, mainly because of an increase in network-related and commission
costs.
Capex in the year amounted to R553 million, with 117 new 2G sites and 92 co-located 3G sites
rolled out, significantly improving quality and capacity on the network.
Notwithstanding the prevailing circumstances, MTN Syria recorded a 3,3% decrease in subscribers to
5,8 million amid extremely challenging conditions. Despite a 4,2%* decline in total revenue, data
revenue increased by 44,2%*. MTN Syria’s EBITDA margin declined by 5,6 (5,3*) percentage points to
17,4%. The operation’s performance will remain under pressure until the crisis in the country is
resolved.
MTN Sudan increased its subscriber base by 10,7% to 8,7 million and its market share to
approximately 33,8%. Revenue increased by 34,5%* and the EBITDA margin expanded by 4,0 (3,9*)
percentage points to 31,7%. Capex in the year amounted to R1 072 million with the roll out of 101
new 2G sites and 366 co-located 3G sites, which supported strong data growth of 202,4%*, albeit off
a low base.
SUBSCRIBER NET ADDITION GUIDANCE FOR 201
‘000
South Africa 2 000
Nigeria 5 000
Large opco cluster 6 750
Iran 2 500
Ghana 800
Cameroon 500
Ivory Coast 750
Sudan 1 250
Syria (50)
Uganda 1 000
Small opco cluster 3 000
Total 16 750
Declaration of final ordinary dividend
Notice is hereby given that a gross final dividend of 665 cents per share for the period to 31
December 2013 has been declared payable to MTN shareholders. The number of ordinary shares in issue
at the date of this declaration is 1 873 278 848 (including 22 337 752 treasury shares).
The dividend will be subject to a maximum local dividend tax rate of 15% which will result in a
net dividend of 565,25 cents per share to those shareholders that bear the maximum rate of dividend
withholding tax of 99,75 cents per share. No STC credits are available for utilisation. The net
dividend per share for the respective categories of shareholders for the different dividend tax rates
is as follows:
0% 665,0000 cents per share
5% 631,7500 cents per share
7.5% 615,1250 cents per share
10% 598,5000 cents per share
12.5% 581,8750 cents per share
15% 565,2500 cents per share
These different dividend tax rates are a result of the application of tax rates in various double
taxation agreements as well as exemptions from dividend tax.
MTN Group Limited’s tax reference number is 9692/942/71/8. In compliance with the requirements of
Strate, the electronic settlement and custody system used by the JSE Limited, the salient dates
relating to the payment of the dividend are as follows:
Last day to trade cum dividend on the JSE Thursday, 20 March 2014
First trading day ex dividend on the JSE Monday, 24 March 2014
Record date Friday, 28 March 2014
Payment date Monday, 31 March 2014
No share certificates may be dematerialised or re-materialised between Monday, 24 March 2014 and
Friday, 28 March 2014, both days inclusive. On Monday, 31 March 2014, the dividend will be
transferred electronically to the bank accounts of certificated shareholders who make use of this
facility.
In respect of those who do not use this facility, cheques dated Monday, 31 March 2014 will be
posted on or about that date. Shareholders who hold dematerialised shares will have their accounts
held by the Central Securities Depository Participant or broker credited on Monday, 31 March 2014.
The MTN board confirms that the Group will satisfy the solvency and liquidity test immediately
after completion of the dividend distribution.
For and on behalf of the board
PF Nhleko RS Dabengwa
Chairman Group President and CEO
Fairland
5 March 2014
For further information on the MTN annual results please refer to the Group’s website: www.mtn.com
Summarised consolidated financial results in accordance with International Financial Reporting Standards (IFRS)
The preparation of the Group’s summarised consolidated financial results was supervised by the Group chief financial
officer, BD Goschen, BCom, BCompt (Hons), CA(SA). The summarised consolidated financial results have been extracted from
the audited consolidated annual financial statements, but are not themselves audited. The directors of the Company take
full responsibility for the preparation of the summarised consolidated financial results and that the financial
information has been correctly extracted from the underlying audited consolidated annual financial statements. A copy of
the full set of consolidated annual financial statements is available for inspection from the Company secretary at the
registered office of the Company.
The results were made available on 5 March 2014.
Summarised consolidated income statement
for the year ended 31 December
Restated
2013 2012
Note Rm Rm
Revenue 136 495 121 867
Other income 1 327 894
Direct network operating costs (18 299) (16 188)
Costs of handsets and other accessories (10 744) (9 590)
Interconnect and roaming (13 816) (13 254)
Staff costs (8 670) (7 534)
Selling, distribution and marketing expenses (16 362) (15 631)
Other operating expenses (10 143) (7 927)
EBITDA 59 788 52 637
Depreciation of property, plant and equipment (16 458) (13 791)
Amortisation of intangible assets (2 820) (2 161)
Operating profit 40 510 36 685
Net finance costs (1 234) (3 790)
Share of results of joint ventures and associates
after tax 8 3 431 3 008
Profit before tax 42 707 35 903
Income tax expense (12 307) (11 835)
Profit after tax 30 400 24 068
Attributable to:
Owners of MTN Group Limited 26 289 20 704
Non-controlling interests 4 111 3 364
30 400 24 068
Basic earnings per share (cents) 7 1 434 1 126
Diluted earnings per share (cents) 7 1 427 1 120
Summarised consolidated statement of comprehensive income
for the year ended 31 December
2013 2012
Rm Rm
Profit after tax 30 400 24 068
Other comprehensive income after tax:
Exchange differences on translating foreign operations*** 11 078 (3 507)
Owners of MTN Group Limited 10 179 (3 498)
Non-controlling interests 899 (9)
Total comprehensive income for the year 41 478 20 561
Attributable to:
Owners of MTN Group Limited 36 468 17 206
Non-controlling interests 5 010 3 355
41 478 20 561
***This component of other comprehensive income does not attract any tax and may subsequently be
reclassified to profit and loss.
Summarised consolidated statement of financial position
as at
Restated Restated
December December January
2013 2012 2012
Note Rm Rm Rm
Non-current assets 150 910 120 199 110 055
Property, plant and equipment 92 903 73 905 64 914
Intangible assets and goodwill 37 751 32 594 32 672
Investment in joint ventures and associates 12 643 4 645 6 359
Deferred tax and other non-current assets 7 613 9 055 6 110
Current assets 75 911 55 875 64 018
Non-current assets held for sale 14 1 281 1 373 820
Current assets 74 630 54 502 63 198
Other current assets 32 808 26 522 29 005
Restricted cash 2 222 5 272 526
Cash and cash equivalents 39 600 22 708 33 667
Total assets 226 821 176 074 174 073
Total equity 119 771 92 887 92 699
Shareholders’ equity 114 438 89 006 88 897
Non-controlling interests 5 333 3 881 3 802
Non-current liabilities 49 066 32 713 32 718
Interest bearing liabilities 12 34 664 21 322 23 139
Deferred tax and other non current liabilities 14 402 11 391 9 579
Current liabilities 57 984 50 474 48 656
Interest bearing liabilities 12 11 361 10 762 10 069
Other current liabilities 46 623 39 712 38 587
Total equity and liabilities 226 821 176 074 174 073
Summarised consolidated statement of changes in equity
for the year ended 31 December
2013 2012
Note Rm Rm
Opening balance 89 006 88 897
Restatement for impact of hyperinflation 8 5 563 -
Restated balance at 1 January 94 569 88 897
Share buy-back**** - (2 088)
Shares issued during the year 5 3
Shares cancelled ^ ^
Transactions with non-controlling interests 16 (495) (122)
Share-based payment reserve 215 147
Total comprehensive income: 36 468 17 206
Profit after tax 26 289 20 704
Other comprehensive income after tax 10 179 (3 498)
Dividends paid (16 210) (14 919)
Other movements (114) (118)
Shareholders’ equity 114 438 89 006
Non-controlling interests 5 333 3 881
Closing balance 119 771 92 887
Dividends per share (cents) 873 797
^ Amounts less than R1 million.
**** During 2012 MTN Holdings Proprietary Limited bought 15 573 340 shares in the Company.
Summarised consolidated statement of cash flows
for the year ended 31 December
Restated
2013 2012
Rm Rm
Net cash inflow from operating activities 27 025 20 062
Net cash outflow from investing activities (19 835) (24 212)
Net cash inflow/(outflow) from financing activities 6 264 (5 280)
Increase/(decrease) in cash and cash equivalents 13 454 (9 430)
Cash and cash equivalents at beginning of the year 22 539 33 074
Exchange gains/(losses) on cash and cash equivalents 3 584 (1 105)
Cash and cash equivalents at end of the year 39 577 22 539
Notes to the summarised consolidated financial results
for the year ended 31 December
1. INDEPENDENT AUDIT
The summarised consolidated financial results have been extracted from the audited consolidated annual financial
statements, but are not themselves audited. The directors of the Company take full responsibility for the preparation
of the summarised consolidated financial results and that the financial information has been correctly extracted from
the underlying audited consolidated annual financial statements.
The consolidated annual financial statements have been audited by our joint auditors PricewaterhouseCoopers Inc. and
SizweNtsalubaGobodo Inc., who have performed their audit in accordance with International Standards on Auditing. A copy
of their unqualified audit report is available for inspection at the registered office of the Company.
2. GENERAL INFORMATION
MTN Group Limited (the Company) carries on the business of investing in the telecommunications industry through its
subsidiary companies, joint ventures and associate companies.
3. BASIS OF PREPARATION
The summarised consolidated financial results are prepared in accordance with the requirements of the JSE Limited Listings
Requirements for preliminary reports and the requirements of the Companies Act applicable to summary financial statements.
The Listings Requirements require preliminary reports to be prepared in accordance with the framework concepts, the
measurement and recognition requirements of International Financial Reporting Standards (IFRS), the SAICA Financial Reporting
Guides as issued by the Accounting Practices Committee, financial pronouncements as issued by the Financial Reporting Standards
Council (FRSC), and must also, as a minimum, contain the information required by IAS 34 Interim Financial Reporting. These
summarised financial results should be read in conjunction with the annual financial statements for the year ended 31 December 2013,
which have been prepared in accordance with IFRS. A copy of the full set of consolidated annual financial statements is available
for inspection from the Company secretary at the registered office of the Company.
4. PRINCIPAL ACCOUNTING POLICIES
The Group has adopted all the new, revised or amended accounting pronouncements as issued by the IASB which were effective
for the Group from 1 January 2013.
The principal accounting policies and methods of computation applied are in accordance with International Financial Reporting
Standards (IFRS) and are consistent in all material respects with those applied in the previous year except as set out below.
5. CHANGES IN ACCOUNTING POLICIES
IFRS 10 Consolidated Financial Statements
The objective of IFRS 10 is to establish principles for the presentation and preparation of consolidated financial statements
when an entity controls one or more other entities.
The Group concluded that the adoption of IFRS 10 did not result in any material change in the consolidated status of its
subsidiaries.
IFRS 11 Joint Arrangements
IFRS 11 requires equity accounting of joint ventures and eliminates the proportionate consolidation option of accounting.
Previously, the Group proportionately consolidated all joint ventures which entailed that it included its share of the assets,
liabilities, income and expenses of jointly controlled entities on a line-by-line basis in its financial statements.
Under the equity method, the investments in joint ventures is initially recognised at cost and the carrying amount is increased or
decreased to recognise the Group’s share of the profit or loss and movements in other comprehensive income of joint ventures after
the date of acquisition. The Group’s share of the profit or loss of joint ventures is recognised in a single line item in profit or
loss under the equity method.
The Group has applied the new policy for investments in joint ventures in accordance with the transition provisions of IFRS 11. The
change in accounting policy has been applied as from 1 January 2012. The Group recognised its investment in joint ventures at the
beginning of the earliest period presented (1 January 2012), as the total of the carrying amounts of the assets and liabilities
previously proportionately consolidated by the Group. This is the deemed cost of the Group’s investments in its joint ventures for
purposes of applying equity accounting.
The change from proportionate consolidation to equity accounting resulted in a change in individual asset, liability, income,
expense and cash flow line items with no impact on equity or profit attributable to equity holders. The impact of the application of
IFRS 11 on the Group’s financial results is disclosed in note 17.
6. SEGMENT ANALYSIS
The Group has identified reportable segments that are used by the Group executive committee (Chief Operating Decision Maker) to make
key operating decisions, allocate resources and assess performance. The reportable segments are geographically differentiated regions
and grouped by their relative size.
Operating results are reported and reviewed regularly by the Group executive committee and include items directly attributable to a
segment as well as those that can be attributed on a reasonable basis, whether from external transactions or from transactions with
other Group segments.
EBITDA is used as a measure of reporting profit or loss of each segment.
Restated
2013 2012
Rm Rm
REVENUE
South Africa 39 707 41 338
Nigeria 48 159 38 697
Large opco cluster 38 659 37 818
Iran***** 9 514 12 175
Ghana 8 269 6 862
Syria 3 229 5 391
Cameroon 5 204 3 812
Ivory Coast 5 480 4 124
Uganda 4 467 3 296
Sudan 2 496 2 158
Small opco cluster 19 804 16 695
Head office companies and eliminations (320) (506)
Iran revenue exclusion***** ## (9 514) (12 175)
136 495 121 867
## Irancell Telecommunication Company Services (PJSC) proportionate revenue is included in the segment analysis as reviewed
by the CODM and excluded from reported revenue due to equity accounting for joint ventures.
***** Excludes the impact of hyperinflation of R1 714 million.
6. SEGMENT ANALYSIS continued
Restated
2013 2012
Rm Rm
EBITDA
South Africa 13 425 14 478
Nigeria 29 235 22 544
Large opco cluster 15 517 14 935
Iran***** 4 075 5 388
Ghana 3 123 2 537
Syria 561 1 238
Cameroon 2 550 1 750
Ivory Coast 2 813 1 662
Uganda 1 603 1 762
Sudan 792 598
Small opco cluster 6 732 5 597
Head office companies and eliminations (1 046) 471
Iran EBITDA exclusion***** ## (4 075) (5 388)
59 788 52 637
Depreciation and amortisation of assets (19 278) (15 952)
Net finance cost (1 234) (3 790)
Share of results of joint ventures and associates after tax# 3 431 3 008
Profit before tax 42 707 35 903
## Irancell Telecommunication Company Services (PJSC) proportionate EBITDA is included in the segment analysis as reviewed by the CODM
and excluded from reported EBITDA due to equity accounting for joint ventures.
***** Excludes the impact of hyperinflation of R739 million.
# Includes the impact of hyperinflation as required by IAS 29.
7. EARNINGS PER ORDINARY SHARE
2013 2012
Number of ordinary shares in issue
At end of the year (excluding MTN Zakhele and treasury shares) 1 832 845 805 1 832 672 645
Weighted average number of shares
Shares for earnings per share (excluding MTN Zakhele and treasury shares) 1 832 729 584 1 837 991 865
Add dilutive shares
- MTN Zakhele shares 6 740 791 9 835 922
- Share schemes 2 988 671 1 575 047
Shares for dilutive earnings per share 1 842 459 046 1 849 402 834
2013 2012
Rm Rm
Reconciliation between profit attributable to the owners of MTN
Group Limited and headline earnings^
Profit after tax 26 289 20 704
Loss on disposal of property, plant and equipment, and intangible assets 34 49
Net reversal of impairment of property, plant and equipment (20) (26)
Impairment of associate - 6
Realisation of deferred gain (357) (308)
Profit on disposal of non-current assets held for sale (510) (368)
Realisation of deferred gain on disposal of non-current assets held for sale (38) (39)
Basic headline earnings### 25 398 20 018
Earnings per share (cents)
- Basic 1 434 1 126
- Basic headline 1 386 1 089
Diluted earnings per share (cents)
- Diluted 1 427 1 120
- Diluted headline 1 378 1 082
^ Amounts are presented after taking into account tax and non-controlling interests.
### Headline earnings is calculated in accordance with circular 2/2013 Headline Earnings as issued by the South
African Institute of Chartered Accountants at the request of the JSE Limited.
Restated
2013 2012
Rm Rm
8. SHARE OF RESULTS OF JOINT VENTURES AND ASSOCIATES 3 431 3 008
AFTER TAX
Irancell Telecommunication Company Services (PJSC)#### 3 115 2 896
Others 316 112
#### The economy of the Islamic Republic of Iran has been classified as hyperinflationary, which has resulted
in the financial results of Irancell Telecommunication Company Services (PJSC) having been accounted for in
accordance with IAS 29 “Financial Reporting in Hyperinflationary Economies”. The effect of applying the
standard has resulted in an increase in the investment in the joint venture and an increase in the share of the
results of the joint venture. Prior period gains and losses arising from the net monetary position have been
recognised directly in equity.
9. CAPITAL EXPENDITURE INCURRED 30 164 28 827
10. CONTINGENT LIABILITIES 1 023 473
11. AUTHORISED CAPITAL EXPENDITURE FOR PROPERTY, 26 151 27 157
PLANT AND EQUIPMENT, AND SOFTWARE
12. INTEREST BEARING LIABILITIES
Bank overdrafts 23 169
Current borrowings 11 338 10 593
Current liabilities 11 361 10 762
Non-current borrowings 34 664 21 322
46 025 32 084
13. ISSUE AND REPAYMENT OF DEBT AND EQUITY SECURITIES
During the year under review, the following entities raised and repaid significant debt instruments:
- MTN Nigeria Communications Limited raised R10,3 billion additional debt through a syndicated loan and
export credit facilities.
- MTN Nigeria Communications Limited repaid R1,2 billion relating to a syndicated term loan facility
and export credit facility.
- MTN Holdings Proprietary Limited raised R6,2 billion additional debt through a syndicated loan facility,
issuance of Unsecured Zero Coupon Commercial Papers and short-term general borrowings.
- MTN Holdings Proprietary Limited repaid R6,0 billion relating to short-term general borrowings,
settlement of Senior Unsecured Notes and Unsecured Zero Coupon Commercial Papers.
In accordance with the Domestic Medium Term Note Programme previously established by MTN Holdings Proprietary
Limited, the Group issued R3,9 billion (December 2012: R5,6 billion) of Senior Unsecured Zero Coupon Notes.
R6,0 billion (December 2012: R4,6 billion) of the Domestic Medium Term Note Programme has been repaid.
There were no share buy-back transactions during the year. During 2012 MTN Holdings Proprietary Limited, a
wholly owned subsidiary of the Group, acquired 15 573 340 shares in the ordinary share capital of the Company
for an amount of R2,1 billion with the cumulative amount of R3 billion spent in respect of the share buy-back
at the reporting date (inclusive of transaction costs). The shares so acquired are fully paid up and are held
as treasury shares.
14. NON-CURRENT ASSETS HELD FOR SALE
The Group entered into a transaction with IHS Holding Limited (IHS) in which IHS will acquire 558 mobile network towers
from MTN Rwandacell Limited and 704 towers from MTN (Zambia) Limited. IHS is a 100% shareholder of the tower companies
set up in each country to manage the towers and other passive infrastructure. MTN Rwandacell Limited and MTN (Zambia)
Limited will be the anchor tenants on commercial terms of the towers for an initial term of 10 years.
Each transaction is expected to close independently during the first half of 2014, subject to customary closing conditions.
In 2013, MTN Côte d’Ivoire S.A. and Mobile Telephone Networks Cameroon Limited concluded transactions with IHS in which
IHS acquired 911 mobile network towers from MTN Côte d’Ivoire S.A. for US$141 million and 820 towers from Mobile Telephone
Networks Cameroon Limited for US$143 million. IHS is a 100% shareholder of the tower companies set up in each country to
manage the towers and other passive infrastructure. MTN Côte d’Ivoire S.A. and Mobile Telephone Networks Cameroon Limited
will be the anchor tenants on commercial terms of the towers for an initial term of 10 years.
15. EVENTS AFTER REPORTING PERIOD
Acquisition of Africa Internet Holding and Middle East Internet Holding
The Group has agreed to acquire 33,3% of Africa Internet Holding (AIH), a joint venture between Rocket Internet and
Millicom International Cellular, to develop internet businesses in Africa. The Group, Millicom International Cellular
and Rocket Internet will each become 33,3% shareholders in AIH.
The Group and Rocket Internet have also agreed to create a joint venture, Middle East Internet Holding (MEIH), to develop
internet businesses in the Middle East, with the Group and Rocket Internet becoming 50% shareholders in MEIH.
The Group expects to invest approximately EUR300 million over the next two to four years into AIH and MEIH.
The investments are subject to regulatory approval, and the two transactions are expected to close during the first and
second quarter of 2014 respectively.
16. CHANGES IN SHAREHOLDING
16.1 Acquisition of 50% in MTN Cyprus Limited
During March 2013, the Group increased its shareholding in its subsidiary MTN Cyprus Limited from 50% to 100% for R690 million.
MTN Cyprus Limited is now a wholly owned subsidiary of MTN (Dubai) Limited.
16. CHANGES IN SHAREHOLDING continued
16.2 Disposal of 0,84% in MTN Côte d’Ivoire S.A.
During March 2013, the Group decreased its shareholding in MTN Côte d’Ivoire S.A. from 67,67% to 66,83% for R57 million.
In 2012, the Group increased its shareholding in MTN Côte d’Ivoire S.A. by 3% to 67,67% for R177 million.
16.3 Acquisition of 40% in Satalite Data Networks Limited
During March 2013, the Group increased its shareholding in Satalite Data Networks Limited from 60% to 100% for R47 million.
16.4 MTN Afghanistan Limited
The International Finance Corporation (IFC) exercised its put option and sold its non-controlling interest of 9,1% in MTN
Afghanistan to MTN (Dubai) Limited for R248 million. MTN Afghanistan Limited is now a wholly owned subsidiary of MTN (Dubai)
Limited.
17. IMPACT OF THE APPLICATION OF IFRS 11
17.1 Income statement
31 December 2012
Adjust-
ments
required in
accordance
Previously with
reported IFRS 11 Restated
Rm Rm Rm
Revenue 135 112 (13 245) 121 867
Other income 894 - 894
Direct network operating costs (20 464) 4 276 (16 188)
Costs of handsets and other accessories (9 789) 199 (9 590)
Interconnect and roaming (15 041) 1 787 (13 254)
Staff costs (7 775) 241 (7 534)
Selling, distribution and marketing expenses (16 052) 421 (15 631)
Other operating expenses (8 321) 394 (7 927)
EBITDA 58 564 (5 927) 52 637
Depreciation of property, plant and equipment (14 860) 1 069 (13 791)
Amortisation of intangible assets (2 386) 225 (2 161)
Operating profit 41 318 (4 633) 36 685
Net finance costs (4 157) 367 (3 790)
Share of results of joint ventures and associates after tax (180) 3 188 3 008
Profit before tax 36 981 (1 078) 35 903
Income tax expense (12 913) 1 078 (11 835)
Profit after tax 24 068 - 24 068
17. IMPACT OF THE APPLICATION OF IFRS 11 continued
17.2 Statement of financial position
31 December 2012 1 January 2012
Adjust- Adjust-
ments ments
required required
in accord- in accord-
Previously ance with Previously ance with
reported IFRS 11 Restated reported IFRS 11 Restated
Rm Rm Rm Rm Rm Rm
Non-current assets 121 097 (898) 120 199 113 787 (3 732) 110 055
Property, plant and equipment 77 485 (3 580) 73 905 71 610 (6 696) 64 914
Intangible assets and goodwill 33 935 (1 341) 32 594 34 540 (1 868) 32 672
Investment in joint ventures and associates 1 765 2 880 4 645 2 681 3 678 6 359
Deferred tax and other non-current assets 7 912 1 143 9 055 4 956 1 154 6 110
Current assets 60 287 (4 412) 55 875 67 621 (3 603) 64 018
Non-current assets held for sale 1 373 - 1 373 820 - 820
Current assets 58 914 (4 412) 54 502 66 801 (3 603) 63 198
Other current assets 27 937 (1 415) 26 522 30 449 (1 444) 29 005
Restricted cash 5 277 (5) 5 272 546 (20) 526
Cash and cash equivalents 25 700 (2 992) 22 708 35 806 (2 139) 33 667
Total assets 181 384 (5 310) 176 074 181 408 (7 335) 174 073
Total equity 92 887 - 92 887 92 699 - 92 699
Shareholders’ equity 89 006 - 89 006 88 897 - 88 897
Non-controlling interests 3 881 - 3 881 3 802 - 3 802
Non-current liabilities 33 307 (594) 32 713 33 392 (674) 32 718
Interest-bearing liabilities 21 742 (420) 21 322 23 554 (415) 23 139
Deferred tax and other non-current liabilities 11 565 (174) 11 391 9 838 (259) 9 579
Current liabilities 55 190 (4 716) 50 474 55 317 (6 661) 48 656
Interest-bearing liabilities 10 790 (28) 10 762 10 462 (393) 10 069
Other current liabilities 44 400 (4 688) 39 712 44 855 (6 268) 38 587
Total equity and liabilities 181 384 (5 310) 176 074 181 408 (7 335) 174 073
17. IMPACT OF THE APPLICATION OF IFRS 11 continued
17.3 Statement of cash flows
31 December 2012
Adjustments
required in
Previously accordance
reported with IFRS 11 Restated
Rm Rm Rm
Net cash inflow from operating activities 25 078 (5 016) 20 062
Net cash outflow used in investing activities (27 059) 2 847 (24 212)
Net cash outflow used in financing activities (5 759) 479 (5 280)
Net decrease in cash and cash equivalents (7 740) (1 690) (9 430)
Cash and cash equivalents at beginning of the year 35 213 (2 139) 33 074
Exchange losses on cash and cash equivalents (1 942) 837 (1 105)
Cash and cash equivalents at end of the year 25 531 (2 992) 22 539
Administration
Company registration number
1994/009584/06
ISIN code: ZAE000042164
Share code: MTN
Board of directors
PF Nhleko** AF van Biljon***
RS Dabengwa* F Titi***
BD Goschen* J van Rooyen***
KP Kalyan*** MLD Marole***
AT Mikati^** NP Mageza***
MJN Njeke*** A Harper#***
JHN Strydom**
^ Lebanese
# British
* Executive
** Non-executive
*** Independent non-executive
Group secretary
SB Mtshali
Private Bag X9955, Cresta, 2118
Registered office
216-14th Avenue
Fairland
Gauteng, 2195
American Depository Receipt (ADR)
Programme
Cusip No 62474M108 ADR to ordinary
share 1:1
Depository: The Bank of New York
101 Barclay Street, New York NY 10286, USA
MTN Group Sharecare line
Toll-free: 0800 202 360 or +27 11 870 8206
if phoning from outside South Africa
Office of the transfer secretaries
Computershare Investor Services Proprietary Limited
Registration number 2004/003647/07
70 Marshall Street, Marshalltown
Johannesburg, 2001
PO Box 61051, Marshalltown, 2107
Joint auditors
PricewaterhouseCoopers Inc.,
2 Eglin Road, Sunninghill, 2157
Private Bag X36, Sunninghill, 2157
SizweNtsalubaGobodo Inc.,
1 Woodmead Drive, Woodmead Estate
Woodmead, 2157
PO Box 2939, Saxonwold, 2132
Sponsor
Deutsche Securities (SA) (Proprietary) Limited
3 Exchange Square, 87 Maude Street, Sandton, 2196
Attorneys
Webber Wentzel
10 Fricker Road, Illovo Boulevard, Sandton, 2107
PO Box 61771, Marshalltown, 2107
Contact details
Telephone:
National (011) 912 3000
International +27 11 912 3000
Facsimile:
National (011) 912 4093
International +27 11 912 4093
E-mail: investor_relations@mtn.co.za
Internet: http:/www.mtn.co
Date: 05/03/2014 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
