#1Ooredoo Group Capital Markets Day 2015 25 May 2015 poredoo#2Disclaimer Ooredoo (parent company Ooredoo Q.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. ooredoo Ooredoo Capital Markets Day 25 May 2015 2#3Agenda ■ 10:00-10:05 Agenda Andreas Goldau - Ooredoo Group Investor Relations ■ 10:05-10:20 Welcome, Dr. Nasser Marafih, OG CEO ☐ 10:20-10:40 Strategy Update, Jeremy Sell, OG CSO ▪ 10:40-11:00 Finance Update, Ajay Bahri, OG CFO ◉ 11:00-11:20, B2B – A growth engine for Ooredoo, Tom Craig, Senior Director B2B - ■ 11:20-11:40 Opco presentation: Qatar ■ 11:40-12:00 Opco presentation: Algeria ■ 12:00-12:45 Q&A ■ 12:45-13:00 Meet the Ooredoo Group Team ■ 13:00-14:00 Lunch ooredoo Ooredoo Capital Markets Day 25 May 2015 3#42014 Performance Total customers ('000) Revenue (QARM) 107,2 54 14,64 33,85 33,20 96,18 4 1 7 +12% EBITDA (QARM) Net profit to ORDS (QARM) 12,94 8 -5% +2% -2% -12% 12M'13 12M'14 12M'13 12M'14 12M'14 12M'13 12M'14 12M'14 X% 2,579 2,134 -8% -17% 12M'13 12M'14 12M'14 2013-2014 growth based on 2014 results excluding Indonesian Foreign Exchange, Myanmar start-up costs and one-off customer acquisition costs in Algeria . • Strong customer growth • • Revenues impacted by FX and challenging market conditions in Kuwait, Tunisia, Iraq NP and cash flows affected by lower EBITDA, foreign currency impact, Myanmar start up cost and Algeria customer acquisition cost ՕՐ Ooredoo Capital Markets Day 25 May 2015 4#5Recent achievements ர்ர் ooredoo Customers Myanmar Launch >111M 1st to market Brand Rollout $1.7B equity value¹ B 2 B B2B >9% YOY Growth of Data 30% of Group revenues ROCKETINTERNET Source: (1) Brand Finance ooredoo Digital Portfolio Value increasing Rationalizing Ooredoo Capital Markets Day 25 May 2015 5#6Market challenges LINE Data pricing still not rational Margins still too low Capacity growth exponential to revenue growth Challenging competition Competitors now Global/regional Regulators slow to embrace consolidation Product mix changing SMS and international voice traffic eroded Data growing fast but lower margins More rationality needed to reward investments ooredoo Ooredoo Capital Markets Day 25 May 2015 9#7We see opportunity ahead Telecom revenue CAGR forecast, 2014-2019 40% 44.2% Data Growth Operational Consolidation 20% 10% Greater regulatory support 7.5% 7.6% 8% 6.1% + 6% Convergence 4% 2.9% 3.0% 2.4% 2% 1.1% B2B, ICT 0% Algeria Indonesia Iraq Kuwait Myanmar Oman Qatar Tunisia Note: CAGR for Myanmar has been calculated based on mobile revenue only and does not include fixed line revenue Source: Ooredoo Group Strategic Market Outlook - 2015, Ovum 2015 Forecast for Iraq ooredoo Efficiency Ooredoo Capital Markets Day 25 May 2015 | 7#8Opportunities by OpCo الله اكبر Algeria Indonesia Iraq Kuwait Myanmar Oman Qatar Tunisia Data growth Operational consolidation Greater regulatory support Convergence B2B, ICT Efficiency (KEY) HIGH MEDIUM Data growth everywhere Big and/or deep sharing being implemented Tangible evidence of regulatory support 4 active strategies Scale of current efforts towards B2B/ICT segment Size of improvements being implemented Focus depends on OpCo market structures ooredoo Ooredoo Capital Markets Day 25 May 2015 8#9Ooredoo remains a good buy for investors • Top Line Growth • Bottom Line Performance Disciplined M&A • • Balanced portfolio of mature and emerging market presence Relatively low smartphone penetration; data still accounts for a relatively low % of revenues; pricing rationality will improve 9m businesses are spending $10B across our footprint; current Ooredoo B2B share is less than 15%. • Performance management ⚫ Cost optimizing • • Infrastructure sharing • Group synergies, e.g. procurement • Improving returns across existing portfolio • Selective value accretive acquisitions Financial and Credit Strength • Attractive shareholder returns with appropriate dividends • Investment grade rating . Conservative credit policy • Government support ooredoo Ooredoo Capital Markets Day 25 May 2015 6#10Agenda ■ 10:00-10:05 Agenda Andreas Goldau - Ooredoo Group Investor Relations ■ 10:05-10:20 Welcome, Dr. Nasser Marafih, OG CEO ■ 10:20-10:40 Strategy Update, Jeremy Sell, OG CSO ▪ 10:40-11:00 Finance Update, Ajay Bahri, OG CFO ◉ 11:00-11:20, B2B – A growth engine for Ooredoo, Tom Craig, Senior Director B2B - ■ 11:20-11:40 Opco presentation: Qatar ■ 11:40-12:00 Opco presentation: Algeria ■ 12:00-12:45 Q&A ■ 12:45-13:00 Meet the Ooredoo Group Team ■ 13:00-14:00 Lunch ooredoo Ooredoo Capital Markets Day 25 May 2015 10. 10#113 years ago, we introduced the Drive strategy صي A . Lead on customer experience "Know" our customers • Embrace customer experience mindset . and culture Stand out from the competition Strengthen our foundations • Work smarter and work better together • Increase productivity Accelerate new growth • Grow B2B & IT services • • Scale profitable mobile data • Move into fiber in selected markets Explore new opportunities, such as TV, finance, and health Source: Ooredoo/Qtel 2012 Capital Markets Day ooredoo Ooredoo Capital Markets Day 25 May 2015 11#12Our portfolio focus remains the same 3 Business Lines Consumer Mobile Consumer Broadband Enterprise ooredoo 3 Geographies Middle East North Africa South-East Asia Ooredoo Capital Markets Day 25 May 2015 12#13What we have delivered... Brand Roll Out Rebranded 7 OpCos - Qatar, Algeria, the Maldives, Tunisia, Myanmar, Kuwait, Oman. Lead on Customer Experience Broadband Growth . Best network: 4G+ in Qatar & Kuwait, 3G launched in Iraq and Algeria. • 4G investments in 5 of our 10 markets. © 25% of data traffic on 4G in these markets. • Strong data revenue growth - 25% of total Group revenues in Q4'14, 30% in Q1'15. . . • Franchise model developed and rolled out in Myanmar, Kuwait, Oman. Smartphone penetration reaching 25% of our subscriber base More rational approach to subsidies. Devices and Retail • Strengthen our Foundations Management Upgrade Accelerated Cost and CAPEX Optimization Leadership Development Program and Business Leader Program. • Long-term succession plans. . Many OpCos continue to exceed cost optimisation targets. ⚫ $133m in savings from centralized sourcing¹. Note: (1) FY2014+Q12015 ooredoo Ooredoo Capital Markets Day 25 May 2015 13 33#14What we have delivered... Accelerated Technology • Strengthen modernization our Network Foundations sharing and Balance Sheet Optimization • • U900 network modernization to deliver significant cost savings across the Group. 1st phase of mobile infrastructure sharing agreement in Tunisia to be implemented before Q1'16; we are sharing fibre in Indonesia and towers in Qatar and Myanmar. Network sharing remains strategic focus. Accelerate Growth Accelerated B2B rollout ⚫QAR 4.7bn revenue in 2014 and 25% customer base growth. .5 out of 8 B2B markets delivering double-digit revenue growth. •Commercial launch with 3G services in Myanmar in a world-first - we reached our millionth customer in under 3 weeks from launch. Inorganic Growth •No major acquisition in the past 3 years. •We divested out of Bravo in Saudi and Wi-Tribe in Jordan. Digital Business · Regional e-commerce JV with Rocket Internet (50/50) covering 15 APAC countries. ooredoo Ooredoo Capital Markets Day 25 May 2015 14 14#153 strategic priorities - no fundamental change - Convergence Bundling, churn reduction, upselling/cross-selling Cost benefits: common infrastructure, leveraged brand and marketing • Stronger B2B offering & capabilities Partnership for content – digital and content to differentiate Network Consolidation • Network consolidation - improve competitive dynamics • True "game changer" - stability, efficiency, big shareholder returns • ⚫ Regulatory support - recognizes downsides of unhealthy competition Efficiency • • • Cost and capital efficiency programs – shared services, IT stack consolidation, outsourcing Asset-light models/Infrastructure sharing – shared/rented towers ⚫ Self-provisioning and self-care - e channels, franchises, "digital" interface ooredoo Ooredoo Capital Markets Day 25 May 2015 15#16Key metrics largely unchanged 2015 1 Growth (Revenue) Financial metrics 2 Margins (EBIT) 3 Return on capital (ROCE) 4 Shareholder returns (TSR) Strategic metrics 5 Customer experience (NPS) 6 Organizational capability building 7 Productivity and synergies ooredoo Ooredoo Capital Markets Day 25 May 2015 | 16#17Agenda ■ 10:00-10:05 Agenda Andreas Goldau - Ooredoo Group Investor Relations ■ 10:05-10:20 Welcome, Dr. Nasser Marafih, OG CEO ☐ 10:20-10:40 Strategy Update, Jeremy Sell, OG CSO ■ 10:40-11:00 Finance Update, Ajay Bahri, OG CFO 11:00-11:20, B2B - A growth engine for Ooredoo, Tom Craig, Senior Director B2B ■ 11:20-11:40 Opco presentation: Qatar ■ 11:40-12:00 Opco presentation: Algeria ■ 12:00-12:45 Q&A ■ 12:45-13:00 Meet the Ooredoo Group Team ■ 13:00-14:00 Lunch ooredoo Ooredoo Capital Markets Day 25 May 2015 17 13#18Group results 2015 Q1 highlights A satisfactory start to 2015 in a challenging and competitive environment • • Number of customers increased by 14% to 111 million, driven by Indonesia, Algeria, and Myanmar Q1 2015 revenue stable at QAR 8,037 million with strong performances in Qatar, Oman, Maldives and Myanmar, challenging market conditions remain in Iraq and Tunisia. Excluding the negative FX impact in Indonesia and Algeria, revenue increased by 3% EBITDA down 5% to QAR 3,205 million. Excluding the impact of currency depreciation (mainly in Indonesia and Algeria) the decrease in EBITDA was limited to 1 % • Excluding the adverse FX impact Net Profit decreased by 4%, instead of the reported 43% . Q1 2015 data revenue increased to 30% of Group revenue due to Ooredoo's strategy to market innovative services for consumer and B2B customers Asiacell launched 3G service in January - 2 million 3G customers; Ooredoo Kuwait launched 4G+ . Investment grade credit ratings maintained (Moody's “A2”, S&P "A-", Fitch "A+") . Post period: New USD 500 Mill. Revolving Credit Facility (RCF) signed in May 2015 ooredoo Ooredoo Capital Markets Day 25 May 2015 | 18#19Group performance Customers (in thousands) +14% 90,969 +7% 110,853 96,660 Revenues (in QAR million) +3% excl. FX impact EBITDA and EBITDA margin (% of Revenue) -1% excl. FX impact Net profit attributable to Ooredoo Shareholders (in QAR million) +10% - 3% 1% -8% -4% excl. 8,384 3,690 -5% 887 8,103 8,037 3,378 808 FX impact 3,205 44% 42% 40% -43% 501 Q1'13 Q1'14 Q1'15 Q1'13 Q1'14 Q1'15 Q1'13 Q1'14 Q1'15 Q1'13 Q1'14 Q1'15 Customer growth continuing across key operations... ...translating into steady revenues in local currency terms... ...cost optimization initiatives offset margin pressure partially ... ...negative FX trends weighs on bottom- line results ooredoo Ooredoo Capital Markets Day 25 May 2015 | 19#20Group results 2015 Q1 performance summary QAR Millions Consolidated revenue EBITDA 3 months ended March 2015 Q1 2015/ Q1 2014 2015 Annual Guidance 0 to -3% 8,037 -1% -1 to -4% 3,205 -5% Net profit attributable to Ooredoo 501 -43% shareholders Earnings per share 1.56 -43% (in Qatari Riyals) Market capitalization 31,939 -28% (as of 31 March 2015) Capital expenditure 1,629 -16% 8,500 to 9,500 Guidance based on FX rate as of March 2015, without FX impact it would have been Revenue: +1% to +4% and EBITDA: 0 to +3%. ooredoo Ooredoo Capital Markets Day 25 May 2015 20 20#21Productivity: An integral part of Drive Strategy Cost Optimization BPO (Business Process Outsourcing) Network Sharing and IT systems consolidation . In 2013 a OPCO benchmarking exercise was performed by ATK with estimated addressable gap of around USD 550m, USD 393m (71%) covered in 2013/14 ⚫ OPCOS are incorporating the identified savings into their Business Plans; process for measurement and reporting of savings implemented across the group Several projects being carried out in 2015: · • Implementation of Best Practices in CAPEX management Data Costing & Data Profitability model Outsourcing (Network & IT, RA & FM, Call Centre) • Opco Cost Benchmarking exercise Strategic sourcing • Increasing scope of Group Strategic Sourcing. ooredoo • Telefonica Alliance in several areas (Procurement, Technology, Device Management etc.) Rationalization of creative agencies & marketing spend. Sharing of infrastructure Ooredoo Capital Markets Day 25 May 2015 21 21#22Cost Optimization Actual savings achieved in key OpCos 2012-2014 71% of addressable gap of USD 550m covered in 2013/14 205 241 152 82 81 50 70 70 26 26 33 10 4 3 14 10 29 18 21 15 11 47 28 26 26 11 2 Iraq Tunisia Algeria Kuwait Oman Indosat Qatar Total Total for 2014 includes USD 7m from small opcos ■2012 2013 2014 ooredoo in (USD m) Ooredoo Capital Markets Day 25 May 2015 22 224#23Capital expenditures: Network modernization mainly complete +27% -10% +11% 9,298 -5% 8,391 7,316 6,942 6,575 26% 27% 25% 21% 22% 12M'10 12M'11 12M'12 12M'13 Guidance for 2015: QAR 8,500-9,500m including Myanmar In QAR mill and Capex to Sales ratio in % oooodoo 12M'14 Ooredoo Capital Markets Day 25 May 2015 23 23#24Technology initiatives across the Ooredoo Group Ooredoo -Tunisia ■ Network Sharing pilot in progress. ■ Fixed line progressing Iraq - Asiacell ■ 3G UMTS Launched Ooredoo - Algeria ■ 3G UMTS deployment ■ East-West Fiber rollout completed ■ Transmission sharing in progress Ooredoo - Qatar ■ 4G LTE Advanced launched. ■FTTH phase 2 completed, phase 3 in progress ooredoo Ooredoo-Kuwait ■ 4G LTE Advanced launched ■ Data Core Modernization completed Ooredoo -Oman ■ 4G LTE Expansion ■RAN modernization in South Oman. ■ Southern Fiber Ring in progress Indonesia - Indosat ■ 4G LTE Launched ■ Network expansion for outside Java completed ■ Java Network expansion in progress Ooredoo- Myanmar ■ 3G Launched ■ Fiber Sharing • • • CORNERSTONES OF OUR ACTIVITIES 3G UMTS launches in Algeria, Iraq and Myanmar • Re-farming to U900 & LTE 1800 continues ⚫ 4G LTE launched in 5 markets (Qatar, Kuwait, • • Oman, Indonesia, Maldives). 4G LTE-A Launched in 2 markets (Qatar & Kuwait) • UNIFY, group transformational program (IT & NW virtualization), in progress with benefits materializing from 2016 Network Modernization completed for all OpCos except South Oman which is in final stages. • Network Expansion underway in all OpCos to accommodate exponential data growth. Ooredoo Capital Markets Day 25 May 2015 | 24#25Smooth long-term debt profile... 1,800 1600 Loans Bonds Sukuk 1,600 1,400 1250 1,200 1000 1000 1000 1000 1,000 750 800 600 500 500 500 400 200 0 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2028 2043 Total Outstanding Loans Total Bonds and Sukuk Total outstanding debt at Ooredoo Q.S.C. level (current status) USD 2,500m USD 6,600m USD 9,100m May 2015 USD 500m 5 year RCF has further improved the debt profile. ooredoo Ooredoo Capital Markets Day 25 May 2015 | 25#26Key financial risk management issues are addressed... Debt refinancing / liquidity risk/rating ■ No imminent refinancing requirements in 2015 ■ Current cash levels comfortable, smooth long term debt profile. ■ Investment grade credit rating maintained Moody's "A2", outlook: negative; S&P "A-", outlook: stable; Fitch "A+", outlook: stable Interest Rate risk Majority in fixed rate debt Foreign Exchange risk ■ FX risk is natural part of investing in Emerging Markets ■ FX hedging policy recently reviewed - Hedging levels appropriate Leverage levels ■ Leverage of 2.5x, at the upper end of Board guidance of 1.5x-2.5x (Net Debt to EBITDA) Cash up-streaming ■ Iraq (some dividends received, recent Central bank regulation changes, in progress) ■ Tunisia (dividends received in stages) ■ Algeria (in progress) ■ No issues in Oman, Kuwait and Indonesia ooredoo Ooredoo Capital Markets Day 25 May 2015 26#27...FX transactional risks are mitigated to the extent practical ...via funding in local currency at OPCOS . Indonesia Medium term transformation of USD/IDR debt mix. • Target 75% local currency Tunisia Algeria • Calling USD 650m bond in June 2015 • 100% local currency funding in TND Plan to increase local currency funding to 100% Maldives . USD loans with a provision to repay in local currency Oman • Some local currency loans Kuwait • All local currency loans ... foreign currency denominated vendor and other payments (leases, etc.) are hedged using: . ⚫ plain vanilla instruments to the extent available • at reasonable costs ooredoo Ooredoo Capital Markets Day 25 May 2015 27 27#28Agenda ■ 10:00-10:05 Agenda Andreas Goldau - Ooredoo Group Investor Relations ■ 10:05-10:20 Welcome, Dr. Nasser Marafih, OG CEO ■ 10:20-10:40 Strategy Update, Jeremy Sell, OG CSO ▪ 10:40-11:00 Finance Update, Ajay Bahri, OG CFO - 11:00-11:20, B2B – A growth engine for Ooredoo, Tom Craig, Senior Director B2B ■ 11:20-11:40 Opco presentation: Qatar ■ 11:40-12:00 Opco presentation: Algeria ■ 12:00-12:45 Q&A ■ 12:45-13:00 Meet the Ooredoo Group Team ■ 13:00-14:00 Lunch ooredoo Ooredoo Capital Markets Day 25 May 2015 28#29Ooredoo Footprint: B2B Addressable Market of $10Bn Fixed voice and data $4bn Mobile voice and data $6bn ☐ Addressable Market is calculated based on Ooredoo core countries which are: Algeria, Tunisia, Iraq, Kuwait, Qatar and Indonesia Sournce: BCG cedoo business Covering more than 9 million companies Ooredoo Capital Markets Day 25 May 2015 29 29#30B2B Opportunity in Footprint Market Opportunity in $bn 0.6 0.2 0.5 0.4 0.3 0.1 3.6 0.4 0.3 0.2 0.2 Algeria Tunisia Iraq Kuwait 0.4 0.2 Qatar Oman 2.8 Indonesia Market Size Source: BCG ooredoo business Mobile Fixed B2B Revenue Grew 9.4% YoY Q1 2014-2015 Ooredoo Capital Markets Day 25 May 2015 | 30 30#31An Entrepreneurial Mindset - Digital Natives The answer of MENA youth to the question of: Would you like to have your own company? YES [FF) 91% 91% of youth across the MENA region believe the internet and technology encourage them to be more entrepreneurial MENA Yemen Tunisia Lebanon Egypt Morocco Qatar Jordan KSA Syria poredoO business UAE Algeria Iraq Kuwait PAA Libya Oman Bahrain 83 84 85 86 82 86 83 82 81 82 79 83 85 78 82 79 69 69 Source: New Horizon, Young Arab and Connected, Survey conducted on MENA Youth, Ooredoo Ooredoo Capital Markets Day 25 May 2015 31#32Rapid ICT Growth Market Value/Segment Huge growth potential across our different segments on our footprint, with value being concentrated in SME & SOHO SME ICT Spend CAGR SMEs in the Middle East are rapidly adopting ICT solutions, growing faster than Western Europe and North America 26.6% Large 15% SME SOHO Source: BCG, Ooredoo B2B Market Sizing, 2010-16 As an example, the percentage of SME & SOHOS in Indonesia is around 99% of the total potential companies, contributing to 57% of the GDP ooredoo business 58.4% 0% 4% Westem Europe North America 10% Midde East Source: Deloitte, Technology, Media and Telecommunication Prediction 2014 Ooredoo Capital Markets Day 25 May 2015 | 32 2#33Growing Economies - Triggers & Barriers Fast-growing 2015 GDP YOY Growth shows that countries on Ooredoo Business footprint are growing faster than the rest of the world's growth 5.5% 3.7% 5.0% 3.4% 1.9% 1.5% 1.5% 7.7% 4.5% Coredoo Average Tu 100 Myanmar 189 Myanmar 177 Mons 185 Kut 150 Algeria 156 184 Iroq Algeria 141 142 Oman 123 Iridonesia 116 Kuwart Oman Tunisia 60 Iraq Kawott Omon Tunksla Algaria Indonesi Catar Myanmar Doing business Storling business Source: IMF, Global Economy Forecast, Oct 2014 cedoo business Challenging Business Environment Relatively difficult business environment reflected in the doing/starting business rank, which adds more challenges to our customers Source: Doing Business Report, World Bank, 2015 Ooredoo Capital Markets Day 25 May 2015 | 33 33#34Growing with our Customers - Building Trust Customer Base Growth More than 25% customer base growth in the course of last year, reflecting how Ooredoo became the operator of choice 2014 Actual YOY Growth Ooredoo Business growth - which is faster than the average GDP growth of countries on our footprint Major Wins Ooredoo Business is the trusted partner of major businesses worldwide 25% 2014 cedoo business 3.6% 9% GE EY GDP Growth 2014 vs. 2013 YOY Revenue Growth مجمو عشا بولينا القابضة KIRIKOM Lagring ne DATA 1208 Ooredoo Capital Markets Day 25 May 2015 | 34 =#35Our Transformation Agenda People & Organisation Business Brand ooredoo business UMU business World-class Channel Partnership & Alliances ERICSSON etisalat B2B Portfolio Ooredoo Capital Markets Day 25 May 2015 | 35#36B2B Brand - Engage & Inspire Business Brand ooredoo business Our Promise Supporting businesses to achieve more by delivering always-on and secure communications business Our Vision Empowering businesses to succeed through unleashing the limitless opportunities of the new connected economies poredoo business Ooredoo Capital Markets Day 25 May 2015 36#37Building Customer Conversations World-class Channel business OOREDOO ACCREDITED PARTNERS OOREDOO SALES ACADEMY Ooredoo Capital Markets Day 25 May 2015 37 36#38Products - Equipped to Deliver Learning from previous experiences Previous Experience The Ooredoo Way Build locally then harmonize different platforms CAPEX intensive Develop once roll out many times on a single platform First generation.cloud architecture approach Inconsistent customer experience Unified customer promise Unified Communications Fload Mobile Convegnica M2M Sport Doto Senartphone, Tablet, PC. Built in-house Leon group organisation with propensity to smart source Foxed Line Commercial Bundles cedoo business Mobile Voice Shoe 10 □J 828 Portfollo Cloud Fload Mobile Subtition Connectivity Convergence Claud Ooredoo Capital Markets Day 25 May 2015 | 38#39M2M - The First Group Product Launch Partnership & Alliances Ooredoo addressable market 733 558 426 988 1.300 Key elements to success Demand driven segmentation 12% 13% 48% Innovation Partnering APS Alliances Open APIs 2014 2015 2016 2017 2018 Healthcare Public • Retail & Finance Building & Security Transport & Logistics ● Energy & Utilities 70% Industrial Automation Consumer Electronics Automotive ooredoo business Dedicated M2M unit 1st Pan-regional platform in MENA & S.E Asia One for all cloud-based architecture Ooredoo Capital Markets Day 25 May 2015 | 39#40To Summarize Launch of Ooredoo Business serving the Communication needs of over 9M companies across our footprint. Serving high growth entrepreneurial customers, with rapid adoption of ICT. $1.3bn business in 2014, expected to grow at double digits for next three years. First pan regional launch of cloud based M2M platform. An industry leading team of world-class B2B talent. cedoo business Ooredoo Capital Markets Day 25 May 2015 40 40#41Agenda ■ 10:00-10:05 Agenda Andreas Goldau - Ooredoo Group Investor Relations ■ 10:05-10:20 Welcome, Dr. Nasser Marafih, OG CEO ■ 10:20-10:40 Strategy Update, Jeremy Sell, OG CSO ■ 10:40-11:00 Finance Update, Ajay Bahri, OG CFO ◉ 11:00-11:20, B2B – A growth engine for Ooredoo, Tom Craig, Senior Director B2B - ■ 11:20-11:40 Opco presentation: Qatar ☐ ■ 11:40-12:00 Opco presentation: Algeria ■ 12:00-12:45 Q&A ■ 12:45-13:00 Meet the Ooredoo Group Team ■ 13:00-14:00 Lunch ooredoo Ooredoo Capital Markets Day 25 May 2015 41 41#42Key results from 2014 Revenue (QR m) Mobile SIMS ('000) +9% +6% +8% +7% 5,704 6,220 6,590 7,148 2,070 2,206 +15% +11% 2,532 2,797 2011 2012 2013 2014 2011 2012 2013 2014 2,948 +10% EBITDA (QR m) 3,249 +1% +5% . 3,273 3,448 2011 2012 2013 2014 ooredoo • Financial performance continues to exceed targets • We continue to maintain market leadership Ooredoo Capital Markets Day 25 May 2015 42 42#43High level comparison with competition Revenue (QR m) Revenue Share 76% 75% 76% 76% 1,706 1,796 1,784 1,862 24% 25% 24% 24% 550 585 559 591 Q1 14 Q2 14 Q3 14 Q4 14 Q1 14 Q2 14 Q3 14 Q4 14 Mobile SIMS ('000) 66% 2,797 2,593 2,645 2,692 Net growth ('000) & ARPU (QR) 132 129 136 131 133 129 124 121 105 34% 61 52 47 1,327 1,354 1,372 1,414 54 42 27 Q1 14 Q2 14 18 Q3 14 42 Q4 14 Q1 14 Q2 14 Q3 14 Q4 14 OQ ARPU VFQ ARPU - OQ Net VFQ Net Source: VFQ Report 2014 ooredoo Ooredoo Capital Markets Day 25 May 2015 43 43#44Customer's voice 85 85 Customer Satisfaction Index B2C Brand Equity Index 83 83 82 83 83 83 83 83 6 6.4 24 83 81 82 83 88 83 82 81 81 81 81 81 2.7 2.4 1.9 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Ooredoo 2012 2013 2014 Ooredoo Vodafone Price Perception Network Perception 88 87 85 84 82 83 84 86 86 90 90 89 90 88 89 89 89 86 73 74 72 72 74 76 77 80 78 79 77 77 77 77 77 68 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Source: Nielsen Ooredoo Vodafone ooredoo Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Bigger, Faster & Better Ooredoo Vodafone Ooredoo Capital Markets Day 25 May 2015 | 44#45Key achievements in 2014 First LTE-A lin the GCC The fastest network got even faster 4G Only from World-class ITU Continuous Hala, iPhone 6 Launch Shahry Promos 1st Go Hala Go Hala 10 Tou Ohs/min For the best price to Ooredo 0000000 0000000 Go Hala Go Hala 10% 1st PLEASE SAFELY A FAMILY OF 3000000 BRAZIL LOOKS BEST ON MOZAIC TV CALL.111 NOW skoordi Qalar Fibre Speed Upgrade mozaic 0000000 Phone 6 1st The Biggest iPhone deserves the Biggest Network Transfer directly to Mpesa in Kenyo with Mobile Money 0000000 ooredoo MoneyGrant Customer Engagement World Cup on Mozaic India & Nepal SIM sales Mobile Money App, 100M deposits ooredoo Major new partners for Nojoom 2 movie tickets for the value of 1 0000000 4G for everyone 1st 4G 4FREE Welcome to OoredooSmart 1st 1st Hala Smart for business, M2M, Smart Cloud and more B2B propositions 256 Ooredoo Capital Markets Day 25 May 2015 | 45 45#46Key achievements in 2014 Ooredoo Marathon and National Sport Day RUN QATAR RUN Mozaic Go app 1st mozaic GO Ooredoo Community OUR COMMU First brand 1st to advertise at HIA MUNITY EST 2014 ONE YEAR OLD 1st Stay connected abroad with Ooredoo Passport Smart Home at The Pearl 1st Fibre at West Bay, Pearl Superfast bower and nament nou OF The Pear Don't let the hackers win Coredoo for COGOGOO Ooredoo DDoS Men Suite 1st 1st 250 OOGOGOO Gorongoo is sweeter with #Araboa 0000000 The fastest connection can now travel with you to 15 countries 4G 1st Ramadan Campaign 4G Roaming ooredoo Nepal, India and Philippine Celebrity events and more community activations ooredoo DDoS Sales Sprint 200u Data Scratch Cards Ooredoo Capital Markets Day 25 May 2015 | 46 46#47Data Monetization Data Revenue (QR M) Data Revenue to Total % CAGR: 10% 336 319 34% 32% 278 28% 252 27% Q1 2014 Q2 2014 Q3 2014 Q4 2014 Increase data • Convert non users-users • • Move 2G to 3G to 4G/4G+ • Get VFQ customers Q1 2014 Q2 2014 Q3 2014 Q4 2014 Drive usage and revenue Make data friendly Continuous stimulation Align demand and capacity Traffic management • Unclog congestion Create dependency & loyalty • Add-ons with sticky data intense interaction • Internet of Everything ooredoo Ooredoo Capital Markets Day 25 May 2015 47#48Digital Universe Website 15 million Visitors 6 million Unique Visitors Online Payments 400 million QR in payments 30% from mobile devices Ooredoo Community Launched on May 27th 2014 17,000 registered users 160,000 unique visits Ooredoo App 340,000 downloads 4/5 average rating mozaic GO Mozaic Go 25,000 downloads 4/5 average rating Mobile Money Launched in November 2014 10,000 downloads 3.8/5 average rating ooredoo Ooredoo Capital Markets Day 25 May 2015 | 48 480#49Success stories Fibre Project 4G Project 315k 920 Homes passed Base stations 205k 91% 54% Connections Completed Phase 1 & 2 On Mozaic TV 3.0 485k 95% 4G+ Customers Coverage Launched 1st in Qatar ooredoo 25 Mbps Qatar 0000000 Qatar PLEASE FIBRE SAFELY 10 Mbp 10 Mbps Ooredoo Capital Markets Day 25 May 2015 | 49 49#50B2B: Major deals in 2014 State of Ministry Qatar & Comme ALJAZEERA Muntajat QD VC State Security Bureau Emphasis on B2B • Incentivize the right sales behavior • Account Management ⚫ Recruiting skilled • specialists Economy ooredoo Ooredoo Capital Markets Day 25 May 2015 | 50 50#51Key drivers in 2014 Shahry Smart 19% increase in customers YoY 12% increased value YoY Mobile Broadband 4% increase in customers YoY 18% increased value YoY Fibre drives Mozaic TV growth 19% increase in customers YoY 36% increased value YoY Business Connectivity 12% increased value YoY Mobile Data 34% increased value YoY Ooredoo Capital Markets Day 25 May 2015 51 55#52Awards Best Customer Care Annual Middle East Call Centre Awards 2014 Marketing Campaign of the Year CommsMEA 2014 Executive of the Year Global Carrier Awards 2014 Company of the Year Telecommunications International Business "Stevies" Award New Product or Service Introduction of the Year International Business "Stevies❞ Award Best Customer Experience Management Implementation Annual Middle East Call Centre Awards 2014 ooredoo Ooredoo Capital Markets Day 25 May 2015 52 52#53Q1 2015 ooredoo#54Mobile and Fixed Revenue 1,086 Mobile revenue (QRm) 1,135 1,112 1,187 1,266 620 Fixed revenue (QRm) 680 672 662 721 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 ooredoo Ooredoo Capital Markets Day 25 May 2015 54 54#55Key drivers in Q1 2015 ☐ Consumer Mobile Services 5% increase in customers QoQ 6% increased value QoQ to Continuous Fibre rollout 3% increase in Mozaic customers QoQ 4% increased value QoQ Business Connectivity 10% increase in value QoQ Mobile Data 27% increased value QoQ ooredoo Ooredoo Capital Markets Day 25 May 2015 55 59#56Agenda ■ 10:00-10:05 Agenda Andreas Goldau - Ooredoo Group Investor Relations ■ 10:05-10:20 Welcome, Dr. Nasser Marafih, OG CEO ■ 10:20-10:40 Strategy Update, Jeremy Sell, OG CSO ▪ 10:40-11:00 Finance Update, Ajay Bahri, OG CFO ◉ 11:00-11:20, B2B - A growth engine for Ooredoo, Tom Craig, Senior Director B2B ■ 11:20-11:40 Opco presentation: Qatar ■ 11:40-12:00 Opco presentation: Algeria ◉ 12:00-12:45 Q&A ■ 12:45-13:00 Meet the Ooredoo Group Team ■ 13:00-14:00 Lunch ooredoo Ooredoo Capital Markets Day 25 May 2015 56 99#57Algeria in figures 10th largest country in the world, the largest in Africa and within Ooredoo Group (2.4mn Km2 ~ 5 times France) • With 38.6mn people Algeria is one of the least densely populated countries in the world (15 pop/km2) • But there are big disparities of density by region: Algiers >3750 pop/km2 GDP/Cap (PPP): $ 7,816. Nominal GDP Growth Rate in 2014F (LC): 9.7% Population Algerian population growth Mn pops, % of the labor force Unemployment rate (%) • Very young population with 51% of people below 30 years old and 25% below 14 60 50 36.3 35.8 34.8 35.3 37.1 37.6 38.1 38.6 39.1 39.6 40.2 40 30 Very diverse and still growing (1.6% CAGR) 13.8 11.3 10.2 10.0 10.0 11.0 9.8 10.8 11.3 11.5 11.6 20 10 • Average Household has 5.33 members • Fixed Broadband Penetration is 28% of HHs • Mobile penetration is 78% of humans with over 100% SIM penetration • Smartphone penetration has reached 20% of mobile users and 15% of total population ooredoo 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 F2016 F2017 F -10 97% Spoken Languages/Dialects % of population 28% 8% 2% Arabic / Algerian dialect French Berber English Ooredoo Capital Markets Day 25 May 2015 57 57#58Algerian mobile market history ATM Monopoly 1999 - 2001 Mobilis mobilie Duopoly: Market Creaming 2002 - 2003 Mobilis YDJEZZY mobilie 742-9 3 Players 4 Brands: Market Hyper Growth Mobilis 2004 - 2007 YOJEZZY mobilie Allo OTA Market Moderate Growth 2008 - 2013 mobilis Y DJEZZY Old state-owned PTT creates mobile arm/brand • Pure postpaid product extremely expensive only accessible to high end officials and their social network • Very small customer base: around 100k in 3 years!!! OTA launched under Djezzy's brand in Feb 2002 OTA makes mobile accessible nationwide by reducing -50% prices of the base postpaid product and launching the first prepaid offer in Algeria OTA foster's creation of first Distributors in Algeria and invests in co-marketing with them • At the end of 2003 OTA reaches 88% share of a market of 1.5mn high end subs (0.5bn USD). • WTA launched under Nedjma's brand August the 25th of 2004 • OTA launched ALLO "no frills" brand August the 26th of 2004 with exactly the same color • OTA leads the market in all aspects profiting from its first mover advantage : price, network, biggest distribution network and 2 brands to compete in all segments • At the end of 2007 OTA reaches 67% value share of a market of 2.6bn USD compared to 13% of WTA (24mn "official" subs). NEDJMA from Wataniya Telecom owned... Diagnosis and New Strategy that led to... Axgi NEDIMA Nedjma's Turnaround and Re-branding to At the end of 2013 Ooredoo Algeria reached 30% value share of a market of 3.5bn USD (30mn "real" subs) while OTA drops to 51%. ...to Ooredoo owned And in 2014 the market enters into a new stage: 3G DEPLOYMENT and DATA SERVICES REALM Ooredoo Capital Markets Day 25 May 2015 | 58 59#59Bn DZD Ooredoo Algeria historical performance 3 Players 4 Brands: Market Hyper Growth Market Moderate Growth (6.7% CAGR) Government money injection to the economy Data services take-off Entering the mature market phase CAGR: 350 300 CAGR: 26% 250 6,2% CAGR: 1,08% 298 280 267 248 216 219 221 192 200 161 135 136 129 136 143 143 150 136 119 85 100 76 74 59 50 102 47 46 50 60 53 31 36 45 50 52 0 T 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Market Ooredoo Djezzy Mobilis Nedjma's Turnaround and Re-branding to Ooredoo Algeria Ooredoo Algeria has grown its revenues at a 22.3% CAGR in the 2008-2014 period, outperforming a market which has grown at 5.5% CAGR and reaching 34.3% revenue share at 2014 EOP!! Ooredoo Capital Markets Day 25 May 2015 | 59#603G launch and OA's performance Ooredoo Algeria was the first to commercially launch 3G services in the country on December 13th 2013, but OA had already taken the lead through an aggressive data pre-emption strategy which started in August 2012 stretching to the limit the EDGE technology (2.5G) MI1 Revenue Shares evolution MBB² Revenue Shares evolution 51% 49% 67% 62% 61% 61% 58% 77% 75% 81% 15% 19% 36% 46% 44% 14% 37% 37% 15% 16% 18% 19% 8% 11% -3% 2% 1% 6% -3% 6% Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 ■Djezzy Mobilis ■ Ooredoo Est. Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 ■Djezzy Mobilis ■ Ooredoo Est. Thanks to a very aggressive devices' subsidies strategy during 2014, OA has been able to speed up data adoption, actually creating the data market, while capturing the majority of the data active subscribers as well as the generated value. Outcome: OA still holds a 58% data revenue share after 5 quarters of commercial operation which represent 17% of overall OA's revenues when before 3G that figure was 6%. Notes: (1) MI="Mobile Internet”; (2) MBB="Mobile Broadband" ooredoo Ooredoo Capital Markets Day 25 May 2015 60 60#61Q1 2015 financial and operational highlights Financial KPIs in bn DZD Q1 Q1 Q4 Q1 (1 US$ 93.1 dzd) = (Avg FX during Q1 2015) YOY QoQ 2014 2015 2014 2015 Revenue 23,631 25,839 +9.3% 26,021 25,839 -0.7% EBITDA 9,140 9,337 +2.2% 2,614 9,337 +257.2% EBITDA Margin 38.7% 36.1% -2.6ppt 10.0% 36.1% +26.1ppt Profit/ Loss 3,333 -1,505 -145% -5,124 -1,505 +70.6% Revenue Share (%) 33.3% 35.5% +2.2ppt 34.3% 35.5% +1.2ppt Data Revenue 10.4% 16.8% +6.4ppt 12.9% 16.8% +3.9ppt Weight (%) Data Market 61.7% 57.9% -3.8ppt 60.7% 57.9% -2.8ppt Revenue Share (%) ooredoo Ooredoo Capital Markets Day 25 May 2015 61 19#62Strategic focus LEAD ON CUSTOMER EXPERIENCE STRENGTHEN . • Keeping mobile data market leadership in Algeria Best data usage experience in Algeria with average data speed per customer far ahead of competition and substantially higher than minimum threshold set out in the T&C's of the 3G License ⚫ Boosting data adoption through devices with the right price/quality balance, improving digital content and customer service through digital channels . Tight control of data pricing to not jeopardize profitability targets • Invest in state of the art network technology within the CAPEX/Revenue targets • Proactively pursue infrastructure sharing agreements with competition OUR . FOUNDATIONS • Optimize asset inventory management ACCELERATE GROWTH . • Actively seeking B2B revenue growth beyond core GSM/3G business (IT services) • • Proactive search of other inorganic sources of growth beyond mobile Strong focus on creating new revenue streams within digital domain via new strategic partnerships/JVs with Financial Services and e-Commerce businesses ooredoo Ooredoo Capital Markets Day 25 May 2015 62 42#63Follow us cedoo Website: ooredoo.com Email: [email protected] Twitter: @OoredoolR Upcoming events 2015 1H Results - August 2015 TBD Thank you