#1Safaricom PLC 05 H1 FY22 Investor Presentation 10th November 2021#22 DISCLAIMER The following presentation is being made only to, and is only directed at, persons to whom such presentations may lawfully be communicated ("relevant persons"). Any person who is not a relevant person should not act or rely on this presentation or its contents. This presentation does not constitute an offering of securities or otherwise constitute an invitation or inducement to any person to underwrite or subscribe for or otherwise acquire securities in the Company. The presentation also contains certain non-GAAP financial information. The Group's management believes these measures provide valuable additional information in understanding the performance of the Company's businesses because they provide measures used by the company to assess performance. Although these measures are important in the management of the business, they should not be viewed as replacements for, but rather as complementary to, the comparable GAAP measures. Safaricom, M-PESA and Safaricom/M-PESA logos are trade marks of Safaricom PLC. Other products and company names mentioned herein may be the trademarks of their respective owners. BEYOND Safaricom C YEARS#33 OPERATING ENVIRONMENT | UNCERTAINTY REMAINS, GRADUAL RECOVERY UNDERWAY Tailwinds RWA Headwinds Improved macro outlook 000 +6.3% YoY GDP projection for 2021 (World Bank), -0.3% 2020 Ταχ % Increasing regulatory scrutiny, Taxation- adjusted excise duty on telco products Improved business sentiment Strong service revenue recovery, strong balance sheet & diversified portfolio را Consumer confidence and business activity boosted by COVID-19 vaccination efforts R Sustained pressure on currency & consumer wallet with rising inflation an Upcoming general elections political risk BEYOND Safaricom 20 YEARS#44 OUR PURPOSE | SUPPORTING ECONOMIC RESILIENCE IN OUR COMMUNITIES Foundations Investing KShs 810Mn 2 million Beneficiaries 1 Sponsorships Supporting our Communities Safaricom Foundation Pamoja (Staff) Initiative atu phos Ndoto Zetu phase 3 projects Maternal & Child Health, Education and Economic empowerment programmes ongoing M-PESA Foundation Uzazi Salama Programme Fistula repair programme Wezesha Elimu phase 4 Christian Blind Mission for Children with Disability Sports (KShs 200Mn) 2021 Tokyo Olympics 2021 World Rally Championship 2021 World Athletics U20 Championships Kenya Open & Sunshine Golf Tours Conservation & Music LEWA Marathon (raised $350Mn for wildlife conservation and community development) Safaricom Youth Orchestra BEYOND Safaricom ZO YEARS#5SUSTAINABLE BUSINESS | STANDING TOGETHER, GOING BEYOND True Value Assessment Impact on society Economic value added Social value of M-PESA 9.7x profit generated (KShs 68.7Bn) 1.5% Kshs 362.0Bn Through operations and taxes 1.0% יוו סכ бос ос For more details on the True Value methodology refer to our 2021 Sustainable Business Report launched in September 2021. Link <SBR Report 2021> Jobs Sustained 1,003,669 5 KShs 242.4Bn A 3.5 % Environmental externalities Kshs 419.0Bn A 3.1% 650k Trees planted A 100% YoY BEYOND Safaricom 20 YEARS#66 STRATEGIC FOCUS | STRONG EXECUTION DRIVING GROWTH Purpose Vision Transformation Goal Transforming lives To be a purpose-led technology company A digital-first, insights-led organization that enables platforms and ecosystem partnerships Deepen Customer Engagement & Experience Transformative Pillars Foundational Enablers o Strengthen the Core To be a Financial Services Provider Win in select digital ecosystems Achieve cost leadership Data & Analytics Network and IT M&A and Partnerships People and Organization BEYOND Safaricom 20 YEARS#77 STRATEGY | PIVOTING TOWARDS A TECHNOLOGY COMPANY 305 00000 Strengthening the Core Defending voice Democratizing data Technology business partner of choice Regional expansion to Ethiopia FinTech Ecosystem Powering digital lifestyles (consumer & businesses) Integrated business solutions Addressing customer pain points Winning in Digital Ecosystems Scale DigiFarm in a commercially Sustainable way Enabling access to clean energy via Circle Gas Driving healthcare inclusion Achieving Cost Leadership Cost optimization to fuel new growth areas: KShs 2.3Bn opex savings Driving productivity and efficiency Safaricom BEYOND NO YEARS#88 Regional Expansion to Ethiopia BEYOND Safaricom 20 YEARS#99 ETHIOPIA | AN OPPORTUNITY TO LAUNCH OPERATIONS BEYOND KENYA GDP per capita, PPP (USD) / Population* Ethiopia is an attractive market Government's clear intention to open up the economy A huge population (median age at 17 years), growing GDP per capita (average at 7% over the last 7 years) • Opportunity to drive digital transformation in Ethiopia A high growth opportunity, low penetration of services (telecoms at 43% and mobile financial services at <2%) 2020 4,452 2,780 2,423 1,297 1,131 49Mn 59Mn 120Mn 30Mn 89Mn Ken Tanz Eth Moz DRC ● Population Sim Card Penetration & GDP Growth Rate Projections Opportunities for Safaricom Telecommunications Services Digital Services Mobile Financial Services (subject to license award) * Source; World Bank. GDP per Capita, PPP is expressed in current international dollars ** Significant sim penetration growth in first 5 years- new licenses driving coverage and multi-simming, base case prior to bid submission 9.8% 10.1% 9.1% 4.1% 81.1% 72.1% -1.8% 62.7% 52.9% 44.4% Launch Y2 GDP Growth rate' * Y3 Y4 Y5 Sim card penetration ** Safaricom BEYOND NO YEARS#10ETHIOPIA | LICENSE AWARDED AND OUR FINANCIAL AMBITIONS BR Spectrum Unified technology neutral telecoms services license, with spectrum allocated 2x10 2x10 2x20 2x20 2x20 3 Capex Investment 5Yr plan: USD 1.5-2.0Bn Network Rollout Y1: clk sites at launch Y10: 10k - 12k sites 10 $ MHz MHz MHz MHz MHz 800 MHz 900 MHz 1,800 MHz 2,100 MHz 2,600 MHz ܀ Y1 Funding including license payment (Safaricom PLC) USD c600Mn Funding sources; Equity, DFIs, local borrowing and internal reserves ` ÷ M EBITDA break-even in Y4 EBITDA Margin Y10 est. at around 40% Enablers Network expansion through own build and infrastructure sharing Sim card penetration World class digital services Mobile money products (subject to license award) Cs Safaricom BEYOND NO YEARS#1111 ETHIOPIA | INVESTMENT RISKS AND UNCERTAINTIES घटी Political & Regulatory Implementation of market liberalisation & new regulatory framework Investment rules and taxation Ongoing political conflict $ Currency Currency volatility Forex availability 毁 Infrastructure Securing access to land and buildings Concluding infrastructure sharing agreements BEYOND Safaricom 20 YEARS#1212 ETHIOPIA | LAUNCH READINESS 01 Completion of company and governance set up Board members appointed Exco leadership team with diverse experience Target date for commercial launch mid 2022 as required by the license 02 03 Contributing to purpose-led digital Ethiopia Regulatory framework operationalization Ethio Telecom partnership on infrastructure Mobile money license Transforming lives Social Contract Onboarding local and international partners including network and IT Operating company fully operational Job creation 04 Ongoing staff recruitment 1,000 employees in year 1 including 150 graduates BEYOND Safaricom 20 YEARS#1313 | The Numbers BEYOND Safaricom 20 YEARS#14HY22 KEY HIGHLIGHTS SOLID PERFORMANCE IN H1 Service Revenue KSh 13 +16.9% YoY HY22 KShs 138.4Bn HY21 KShs 118.4Bn Capex ● +0.3% YoY HY22 KShs 22.8Bn HY21 KShs 22.8Bn Note; All numbers include Ethiopia in all financial slides 14 $ % +4.7% YoY Customers One month active 31.75Mn HY22 30.31Mn 000 KES HY21 EBIT +28.8% YoY HY22 KShs 57.9 Bn HY21 KShs 45.0Bn ● Free Cash Flow +45.8% YoY HY22 KShs 34.4Bn HY21 KShs 23.6Bn Safaricom BEYOND NO YEARS#15SERVICE REVENUE | DOUBLE DIGIT GROWTH, SUPPORTED BY M-PESA Contribution to Service Revenue Growth (KShs Bn) 16.4 1.4 118.4 1.3 0.6 Evolution of Service Revenue Profile 0.4 138.4 (0.0) Fixed Enterprise 2.4% Others 13.1% Fixed Enterprise 2.5% Others 11.2% FTTH 1.4% M-PESA 30.3% FTTH 1.5% H1 FY21 M-PESA Mobile data Voice Outgoing Fixed Enterprise FTTH Other* H1 FY22 +45.8% YOY +6.3% YOY +3.2% YOY +20.1% YOY +23.0% YOY -0.2% YOY +16.9% YOY 43.0 -1.1% Voice Revenue 40.2 3.2% 41.5 HY21 Mobile Data 18.8% Voice Outgoing 33.9% HY22 Mobile Data 17.1% Service Revenue 131.9 126.9 118.4 4.3% 4.0% Voice Outgoing 29.9% 16.9% 16.9% 138.4 -4.8% -6.5% H2 FY20 H1 FY21 H2 FY21 H1 FY22 H1 FY20 H1 FY21 H1 FY22 Voice Revenue (KShs Bn) % YoY Service Revenue (KShs Bn) % YoY *Others - Incoming Voice & SMS revenue, Messaging and Other SR 15 ■M-PESA 37.8% BEYOND Safaricom 20 YEARS#1616 M-PESA REGAINING MOMENTUM WITH RETURN TO CHARGING Contribution to M-PESA Growth Withdrawals Transfers 7.6ppts +18.8% YoY 23.9ppts +89.5% YoY +45.8 % YOY 14.3ppts +43.7% YoY Contribution to Fintech Solutions Growth Lending & Savings +17.2%% YoY ●Fuliza, M-Shwari KCB M-PESA ●M-KOPA, M-KESHO Other savings ■IMT +22.6% YoY ●International Money Transfer, Alipay 0.6ppts 1.8ppts 4.1ppts 14.3ppts 7.7ppts Payments +50.7% YoY C2B +42.1% YoY B2C +48.5% YoY ● LNM +83.6% YoY ● B2B +24.2% YoY Betting >100.0% YoY Fintech Solutions • Value of M-PESA transactions +51.5% YoY, KShs 13.7Trn, of which 18.1% is still zero-rated • Volume of M-PESA transactions +42.0% YoY, 7.3Bn • One month active M-PESA Agents +19.7% YoY, 258k • One month active merchants tills +72.8% YoY, 387k BEYOND Safaricom 20 YEARS#17R M-PESA | SUSTAINED VELOCITY IN THE CUSTOMER ECOSYSTEM H1 FY22 H2 FY21 H1 FY21 Usage Growth, Opportunity to Drive Penetration Remains Sustained Growth in Value of M-PESA Transactions Total M-PESA Value 18.1 13.0 28.7 9.0 (KShs Trn) Transfers 2.1 2.0 13.7 1.6 14.5 28.3 H1 FY21 H2 FY21 H1 FY22 H1 FY21 H2 FY21 H1 FY22 9.4 26.8 Withdrawals 1.1 1.1 0.9 M-PESA one month active customers (Mn) Chargeable transactions per one month active customers Payments 4.3 3.9 2.5 H1 FY21 H2 FY21 H1 FY22 H1 FY21 H2 FY21 H1 FY22 Note; M-PESA Wallet to Bank/ Bank to M-PESA Wallet transactions still zero rated, accounting for 18.1% of HY22 total value of M-PESA transactions 17 BEYOND Safaricom 20 YEARS#1818 M-PESA | DEVELOPING SCALABLE DIGITAL PLATFORMS FOR KEY GROWTH AREAS CONSUMER FOCUS 3.9Mn App Customers Target Addressable Market 29.0Mn CONSUMER SUPER APP Customer Focused Products, Intuitive Digital Journeys Subject to Regulatory approval P2P C2B E-COMMERCE 1888 LOYALTY & CVM CREDIT MINI APPS DELIVERING CONSUMER VALUE PARTNERSHIPS M-PESA 2.0 FINTECH PLATFORM B2B WEALTH INSURANCE BIG DATA SAVINGS BUSINESS FOCUS 322k Business App Customers 258k Agents Target Addressable Market +5.0Mn BUSINESS SUPER APP Merchant Business Solutions, Extensive Agency Network BEYOND Safaricom 20 YEARS#1919 MOBILE DATA | PRICE RATIONALIZATION SLOWS DOWN PERFORMANCE 22.2 Mobile Data Revenue 22.6 +6.3% YOY 23.6 2.0 1.5 13.7 12.2 1.3 10.0 H1 FY21 H2 FY21 Mobile data revenue (KShs Bn) Average GBs per user Data ARPU HY 22 KShs 198.3 +7.9% YoY H1 FY22 Rate per MB (Cents) GBs per chargeable User +47.8% YOY Rate per MB (cents) -27.0% YoY +4.7% YoY 31.7 30.3 31.5 Opportunity to Drive Usage and Growth Remains +8.1% YoY 17.0 +16.4% YoY 16.7 15.7 11.5 10.8 9.9 +37.3% YoY 9.7 +26.7% YoY 8.5 7.1 6.8 6.1 5.4 One month active customers (Mn) Distinct data bundle customers Data customers using >100MBs (Mn) Active 4G devices (Mn) Data customers using >1GB (Mn) (Mn) H1 FY21 ■ H2 FY21 ■ H1 FY22 Spurring usage and growth through: Enhanced CVM propositions and personalised offerings Aggressive customer acquistions Expanding the base of device financing customers I Driving content aggregation Launched Baze platform Safaricom BEYOND NO YEARS#20FIXED SERVICE | ACCELERATED CUSTOMER ACQUISITION DRIVES SOLID GROWTH Contribution to Fixed Revenue Growth FTTH 8.3ppts +22.9% YoY KShs 2.0 Bn +21.1% YoY KShs 5.5Bn FTTB 8.8ppts +15.8% YoY KShs 2.9Bn Other 4.Oppts +48.2% YoY KShs 0.6Bn *LTE customers 25.28k, +55.5% YoY making up 56.3% of total fixed data closing customers at 44.89k, +38.3% YoY ** Fixed Enterprise ARPU ex-LTE KShs 23.32k, LTE ARPU 3.7k, Fixed Enterprise ARPU KShs 11.63k in HY22 20 2,337 119.1 FTTH 153.4 137.4 2,278 53.5% 58.5% H1 FY21 Closing Customers ('000s) H2 FY21 ARPU (KShs) 32.4 Fixed Enterprise 38.9 2,334 63.9% H1 FY22 Conversion rate 44.9 15.6 12.8 11.7 H1 FY21 H2 FY21 * Closing Fixed Data Customers ('000s) H1 FY22 ** Fixed Enterprise ARPU (KShs '000s) BEYOND Safaricom 20 YEARS#21NET INCOME | IMPROVED PERFORMANCE DRIVEN BY TOP LINE RECOVERY & COST EFFICIENCIES D PERFO 21 33.1 2.3 16.2 (4.4) (1.1) (0.3) (2.7) 37.1 (6.0) Service Revenue and EBIT (KShs Bn) 138.4 118.4 G 57.9 45.0 39.6% 36.3% H1 FY21 H1 FY22 Service Revenue EBIT EBIT Margin H1 FY21 Net income Contribution Margin Opex Savings Opex Costs Depreciation Share of Associate & JV loss Finance cost Taxation H1 FY22 Net Income EBIT Margin improved 3.3ppts Margin ime BEYOND Safaricom 20 YEARS#22CAPEX SUSTAINED INVESTMENT TO ENHANCE CUSTOMER EXPERIENCE | IT Capex 33.5% Fixed Network 6.5% HY22 Capex Allocation Growth: 79.6% KShs 18.1 Bn Maintenance: 20.4% KShs 4.7Bn Other Network Mobile 5.2% 22 HY22 Capex Split Operations 1.7% Transmission 8.9% Core Network 7.7% 37.3 36.3 Capex (KShs Bn) 36.1 40-43* 35.0 22.8 17.4 17.0 22.8 18.1 Radio Access 36.5% FY18 FY19 FY20 FY21 FY22 H1 FY Capex Intensity 14.9% 13.8% 14-16% 13.2% FY19 FY20 FY21 FY22 Capex Intensity *Capex guidance excluding Ethiopia BEYOND Safaricom 20 YEARS#2323 90 Outlook JUKI BEYOND Safaricom 20 YEARS#2424 REVISED FY22 GUIDANCE Initial Guidance FY22 (KShs) EBIT 105-108Bn Capex 40 - 43Bn H Revised guidance (KShs) Including Safaricom Ethiopia 97-100Bn EBIT CAPEX 70-73Bn Safaricom PLC Group Excluding Safaricom Ethiopia EBIT 107-110Bn CAPEX 40-43Bn BEYOND Safaricom NO YEARS#2525 Thank You! BEYOND Safaricom 20 YEARS#2626 . Simple ⚫Transparent Honest FOR YOU BEYOND Safaricom 20 YEARS