Trading statement Telkom SA SOC Limited Registration number 1991/005476/30) JSE share code: TKG ISIN: ZAE000044897 ("Telkom" or “the company”) Trading Statement In terms of paragraph 3.4(b) of the JSE Limited (“JSE”) Listing Requirements, companies are required to publish a trading statement as soon as they have reasonable certainty that the financial results for the next period to be reported upon differ by at least 20% from those of the previous corresponding period. Telkom is currently finalising its interim results for the six months ended 30 September 2016, which will be released on the Stock Exchange News Service (“SENS”) of the JSE on 15 November 2016. The prior period reported earnings were impacted by voluntary early retirement packages (VERPs) and voluntary severance packages (VSPs) of R1 523 million with a tax benefit of R446 million. As a result, the reported headline earnings per share (HEPS) is expected to increase between 370% and 390% when compared to the previous corresponding period. The reported basic earnings per share (BEPS) is expected to increase between 205% and 225%. On a normalised basis, i.e. excluding the impact of VERPs and VSPs and the related tax benefit, HEPS is expected to increase between 10% and 30% and BEPS is expected to increase between 0% and 20%. The improved performance is due to our multi-year business transformation program. 30 September 2015 30 September 2016 Prior period earnings Expected growth Expected earnings (cents) (%) (cents) Basic earnings per share Reported 110.4 205 – 225 336.7 to 358.8 Normalised 321.1 0 – 20 321.1 to 385.2 Headline earnings per share Reported 69.9 370 - 390 328.5 to 342.5 Normalised 280.6 10 - 30 308.6 to 364.7 The above earnings include the performance of BCX, which has been incorporated for six months compared to one month in the prior period. The above information has not been reviewed nor reported on by Telkom’s independent external auditors. The Group's results for the six months ended 30 September 2016 will be released on SENS on 15 November 2016 with a presentation in Johannesburg on the same day. The presentation will be available for all stakeholders on the Group's website, www.telkom.co.za/ir . Centurion 27 October 2016 Sponsor The Standard Bank of South Africa Limited Date: 27/10/2016 02:30:00 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.