Contents

Macro overview 5

Redefining our strategy 8

Our growth potential 12

Financial highlights 25

Company snapshot 4

H1 2019 highlights 33

2

Disclaimer

This document has been prepared by Telecom Egypt (the “Company”) solely for the use at the analyst/investor presentation, held in connection with the Company. The information

contained in this document has not been independently verified. This document contains statements related to our future business and financial performance and future events or

developments involving Telecom Egypt that may constitute forward-looking statements. Such statements are based on the current expectations and certain assumptions of

Telecom Egypt's management, of which many are beyond Telecom Egypt's control. Such assumptions are subject to a number of risks and uncertainties. Should any of these risks or

uncertainties materialize, or should underlying expectations not occur or assumptions prove incorrect, actual results may (negatively or positively) vary materially from those

described explicitly or implicitly in the relevant forward-looking statement. Telecom Egypt neither intends, nor assumes any obligation, to update or revise these forward-looking

statements in light of developments, which differ from those anticipated.

This document does not constitute an offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares of the Company and neither it nor any

part of it shall form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. This presentation has been made to you solely for information

purposes and is subject to amendment. This presentation (or any part of it) may not be reproduced or redistributed, passed on, or the contents otherwise divulged, directly or

indirectly, to any other person or published in whole or in part for any purpose without the prior written consent of the Company.

3

Egypt

30%

USA

24%

Europe

18%

GCC

17%

ROW

5%

Company snapshot

Heritage transformed

TE’s incorporation

• Founded in 1854 with the first telegraph line in Egypt

• Incorporated in 1998 replacing the former Arab Republic of Egypt

National Telecommunication Organization (ARENTO)

• Listed in 2005 on the Egypt and London Stock Exchanges

• Acquired a 45% stake in Vodafone Egypt in 2003 to 2006

• Rebranded the retail business to WE in 2017 with the launch of

mobile services

Government,

80%

Free float,

20%

Institutional,

17%

Retail, 3%

Ownership: Highly diversified solid institutional shareholder base

Market Cap of USD 1.4bn | ETEL EY/ ETEL.CA (as of August-2019)

Free float composition Breakdown of institutions

4

Macro overview

5

26%

11%

19%

29%

3%

12%Illiterate

Literate

Primary

Secondary

High school

University degree

Demographic indicators

Young population to continue to drive growth

Illiteracy ↓ from 30% in 2016

74% of population is literate

Population (mn) Age distribution (% of population)

Educational attainment (% of population) Unemployment rate (% of population)

Source: CAPMAS 2018 censusSource: CAPMAS 2017 census

Source: CAPMAS 2017 census Source: Ministry of Finance

25%

19%

17%

15%

10%

8%

5%2%

0-9

10-19

20-29

30-39

40-49

50-59

60-69

70+

c2mn new customers in

the market every year

61% of population

below 30 years

13.0% 12.8% 12.7%12.0%

8.9%

2013/14 2014/15 2015/16 2016/17 2017/18

6

87.7

92.2

94.2

96.2

98.2

2014 2015 2016 2017 2018

7.2%8.1%

5.5%7.2%

8.4%

12.4%

13.9%

25.9%

32.3% 31.9% 33.3%

19.9%

11.6%10.9%

8.6% 8.3%

8.9%

6.4%

4.4 4.3 4.2

5.35.5

5.9 6.0

Real GDP growth (%)

9.25%9.75%

11.25%

12.25%

15.25%

17.25%

19.25%

18.25% 17.25%16.25%

14.75%

7.5 7.6 7.8 7.9 8.1 8.9 8.9

14.8

17.8 18.1 17.8 17.8 17.7 17.8 17.9 18.017.6 17.1

Macro indicators

A broad set of healthy indicators across the year

Average USD to EGP rate

CBE discount rate Core inflation (YoY)

Source: IMF Source: Central Bank of Egypt

Source: Central Bank of Egypt Source: Central Bank of Egypt

7

Redefining our strategy

8

Adel Hamed

Managing Director &

Chief Executive Officer

Mohamed Shamroukh

Chief Financial Officer

Mohamed Abo-Taleb

Chief Commercial Officer

Essam Abdeldayem

Vice President for Human

Resources

Seif Allah Mounib

Vice President for International

Wholesale

Our leadership team

Caliber from the mobile & fixed industries with local & int ’l experience

Antar Kandil

Chief Information Officer

Abdelsatar Elsheikh

Vice President for Regional

Affairs

Mohamed Alfowey

Vice President for Technical

Affairs9

Heading towards…

A telco demonstrating its ability to seize new opportunities

Digital

transformation

Digital route

and hub

Preferred

data

operator

Offering our customers a

data-centric value

proposition, expanding

beyond connectivity into

content-based products

Capitalizing on the national

digital transformation

initiative by availing and

developing our fiber-optic

network across Egypt

Expanding from an

established international

route to an eminent regional

digital hub

10

WE digital transformation

Our strategy is driven by creating a comprehensive digital ecosystem to optimize

resources and boost the ICT economy

Digital transformation ecosystem

Data centers

& cloud IOTDigital

platforms OTT

Digital transformation process

WE digital

strategy &

objectives

Digital team &

governance

Internal digital

transformation

Digital

market

disruption

Complete

digital

inclusion

Apps

& solutions

Cloud platforms

World class data center facilities

Submarine cables & fiber connectivity

‘WE Digital’

Capitalizing on our assets

11

Our growth potential

12

5,473

11,280

4,977

6,541

2015 2018 H1 2018 H1 2019

EGP 1.1bn

+39% YoY

EGP 7.1bn

+40% YoY

EGP 3.1bn

+26% YoY

FY 2018

EGP 11.3bn

+36% YoY

• Underpenetrated data market leading to a

growing fixed & mobile customer base

• Improved broadband connectivity and continuous

demand for higher usage enhances ARPU

• Protocols with government entities for

digital transformation:

− NUCA

− Ministries i.e. schools project

− Connecting governorates i.e. Port

Said project

• New cities

Retail segment

Growth drivers at a glance

• Growing mobile customer base

• Growing fixed voice customers driven

by fixed broadband connectivity

Voice Data

Other

Retail revenue growth

( in EGP mn)

31%

27%

CAGR

13

Widening our retail portfolio

Moving beyond traditional connectivity

First phase:

- Paying for WE portfolio services

- Cross-net transfer

- Peer-to-peer transfer

- Person-to-merchant transactions

Second phase:

- Availability for feature phones

- International remittances

WE Wallet WE IPTV

1st

nationwide IPTV license

Tailored packages:

- Entertainment

- Sports

- TV series & movies

- Kids channels

- Video library

Coming next

Fully convergent

product

‘Indigo Plus’

Mobile prepaid

launch

4G mobile

license

acquisition

Best value

recharge

platform

‘Level Up’

PlayStation

packages

‘WE Internet ’

(1st

FBB revamp)

+

Postpaid mobile

launch

Sep 2016 Sep 2017 Feb 2018 Apr 2018 Nov 2018 Jul 2019Aug 2018

‘WE SPACE’

(2nd

FBB revamp)

14

WE SPACE

A new shift in our fixed broadband offering

Comparison of

the entry level bundle

Up to30 Mbps

EGP 120

140 GB

July 2019

Up to5 Mbps

EGP 110

100 GB

April 2018

Speed

Price

Quota

Launch

date

15

28.7%27.7%

30.0%32.4%

33.5%

16.6%19.0%

21.8%

26.9%28.1%

2015 2016 2017 2018 H1 2019

Fixed line

Broadband

2,809

3,382

4,070

5,237

5,536

76.0

83.1

98.3

103.5

109.9

70.0

80.0

90.0

100.0

110.0

120.0

130.0

0

1,0 00

2,0 00

3,0 00

4,0 00

5,0 00

6,0 00

2015 2016 2017 2018 H1 2019

Subscribers (in 000’s)

ARPU (EGP)

6,555 6,465

7,145

7,8658,213

31.1

28.7

29.6

30.5 31.3

27.0

29.0

31.0

33.0

35.0

37.0

39.0

0

1,0 00

2,0 00

3,0 00

4,0 00

5,0 00

6,0 00

7,0 00

8,0 00

9,0 00

2015 2016 2017 2018 H1 2019

Subscribers (in 000’s)

ARPU (EGP)

2,809

3,382

4,070

5,237

5,536

982 1,057 1,127 1,297 1,346

2015 2016 2017 2018 H1 2019

TE

Others

Market fixed broadband subscribers

(in 000’s)

Market fixed voice and data household penetration

WE fixed voice

Fixed line services

Growing customer base with healthy ARPU

WE fixed broadband

16

2,408 2,244 2,462 3,108

1,508 1,722

2,625 3,631

5,049

7,085

3,264

4,432

440

741

779

1,086

204

387

2015 2016 2017 2018 H1 2018 H1 2019

Other

Data

Voice

21%

25%

36%

31%

Retail revenue growth driven by data

(in EGP mn)

Fixed line services (cont ’d)

Accelerating our fiber replacement project to grasp market opportunities

70% 85%

2018a 2019e 2020f

100%

Fiber access network capacity

(in 000’ homes)

2,140

5,180

9,692

12,608

17,567

22,989

2014 2015 2016 2017 2018 H1 2019

% of households reached with fiber

(excluding the last mile)

17

2,204

3,096

4,456

6,370

2,951

3,994

421

536

593

716

313

438

2015 2016 2017 2018 H1 2018 H1 2019

Managed Services

Broadband

Data revenue

(in EGP mn)

38%

39%

40%

36%

38,354 39,622 44,082 39,647 39,333

33,056 33,883 34,117

29,475 28,480

22,236

33,900 32,300

27,500 26,600

2,300

3,861 4,260

FY 2015 FY 2016 FY 2017 FY 2018 H1 2019

Mobile market subscribers

(In 000’s)

102%

114%117%

102% 100%

33% 34%37% 39% 39%

FY 2015 FY 2016 FY 2017 FY 2018 Q1 2019

Voice penetration

Data penetration

Mobile market

Preserving the growth of our customer base

*Etisalat restated its customer base starting FY 2016

3.3

Source: Operators’ disclosure

WE's mobile subscribers

(In 000’s)

Mobile data market subscribers

(in 000’s)

Source: MCIT & Operators’ disclosure

3,305

3,589

3,861

4,247 4,260

Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019

Mobile market voice and data penetration

18

26,300 28,650

32,790 35,060 35,440

3,820 3,280

3,260 3,210 3,030

FY 2015 FY 2016 FY 2017 FY 2018 Q1 2019

USB

Mobile data

Source: MCIT

EGP 3.5bn

+66% YoY

EGP 4.4bn

-9% YoY

• Largest international network footprint in the

region

• Preferred East-West international route

• Positioning Telecom Egypt as an eminent digital

hub

+39% YoY

Wholesale segment

Growth drivers at a glance

• Sole provider of international calls to MNOs

• 4-5 year agreements

Domestic

International Carrier Affairs

International Cables &

Networks

• Egypt’s infrastructure builder

• 3-10 year agreements

• Indirect play on data market growth

6,711

11,491

5,148 6,155

2015 2018 H1 2018 H1 2019

Wholesale revenue

( in EGP mn)

20%

20%

EGP 3.6bn

+8% YoY

FY 2018

EGP 11.5bn

+12% YoY

CAGR

19

Trans border Terrestrial Cables with Libya & Sudan

Egypt

Iraq

Indonesia

Thailand

Myanmar

Morocco

Algeria

France

Qatar

India

Pakistan

Iran

Oman

Yemen

Saudi Arabia

Turkey

Syria

Lebanon

Sudan

Ethiopia

Somalia

Libya

Mozambique

Madagascar

Tanzania

Kenya

Greece

Tunisia

Djibouti

Sri Lanka

Jordan

Maldives

Taiwan

Brunei

VietnamPhilippine

Japan

Korea

Belgium

UK

Singapore

Germany

China

Cyprus

Italy

Portugal

Eritrea

Bangladesh

Australia

U.A.E

Malaysia

SEAMEWE-3

SEAMEWE-4

FLAG

FALCON-HAWK

IMEWE

EIG

SEACOM

TATA

ALETAR/BRYTAR

TE North

GBI

Taba-Aqaba

AAE1

SEAMEWE -5

Alexandros

MENA Cable

Our cable systems network

offers reach and reliability

20

47 62 338 207

46 605

165 236

368 386

178

270

467

655

961

2,316

451

439

128

173

439

588

271

322

2015 2016 2017 2018 H1 2018 H1 2019

Cable Projects

Ancillary Services (O&M)

Capacity Sales

International Customer Support

6 6 19 12

3 35 21 23

21 22

10

16

61 65

54

130

25

25

17 17 25

33

15

19

2015 2016 2017 2018 H1 2018 H1 2019

Cable Projects

Ancillary Services (O&M)

Capacity Sales

International Customer Support

76 41

62 45

25 24

311

277 212

204

101 107

2015 2016 2017 2018 H1 2018 H1 2019

International Direct Dialing (IDD)

Transit

Int’l Carriers revenue breakdown in EGP

(in mn)

International services

Growth across the majority of our business lines

Int’l Customers & Networks revenue breakdown in EGP

(in mn)

Int ’l Carriers revenue breakdown in USD* (in mn) Int’l Customers & Networks revenue breakdown in USD* (in mn)

* Based on full year and 6-month average USD exchange rates

582 410

1,099 801

443 415

2,396 2,794

3,769

3,623

1,793 1,854

2015 2016 2017 2018 H1 2018 H1 2019

International Direct Dialing (IDD)

Transit

* Based on full year and 6-month average USD exchange rates 21

Agreements with domestic MNOs

Securing long-term revenue streams

Securing longer-term agreements with

domestic mobile operators

Boosting our wholesale revenue stream by

monetizing our infrastructure investmentsOur main goals 1 2

International Services 12bn

1.5bnTransmission Services 10.85bn

Transmission Services

International Services 3bn

3bn

1.5bn

International Services 4bn

Transmission Services 1.5bn

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2028

1.5bn

1.5bn

3bn

22

Vodafone Egypt infrastructure agreements and

dividends distribution

International Services 12bn

Transmission Services 1.5bn 10.85bn

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2028

EGP 4.8bn EGP 0.7bn

June 2020March 2019EGP 5.5bn in dividends

Deleveraging EGP debt

Cost cutting initiatives

Usa

ge

o

f p

roc

ee

ds

1

2

Investments for expansion3

Interest savings of EGP 490mn in 2019

Reactivating early retirement program

Enabling 2019 CapEx intensity guidance of 30%

18 February 2019

Representing +90% of our share as of Mar 2018

12.6

8.1

10.2

2.1

1.11.6

FY 2018 Q1 2019 H1 2019

Net Debt (EGP bn) Net Debt/EBITDA (x)

23

2019 agreements & events

Strategic moves, paving the way for the future

Announced a change in the BoD by a decree from

the Egyptian Prime Minister

2019 business calendar

Signed high-speed bitstream services agreement

with Orange Egypt

Signed two 10-year transmission and infrastructure

agreements with Vodafone Egypt valued at EGP

10.85bn and reached an agreement on dividend

distribution

Jan

Feb

Signed MOUs with Huawei, Ericsson, Nokia, CISCO

and Microsoft at MWC Barcelona 2019 to assess and

develop TE’s network

Published an all-encompassing integrated annual

report about 2018 operations and strategic

directions

MarAnnounced the BoD’s approval to proceed with a

voluntary early retirement program for TE employees

Telecom Egypt’s Ordinary General Assembly (GA)

appointed its BoD for a new term of three years. It

approved the change of two independent board

members

Apr

Signed a landing party agreement with Pakistan &

East Africa Connecting Europe (PEACE) Cable

International Network Co. and PCCW Global valued

at USD 45mn

Signed a binding letter of intent (LoI) with PEACE and its

parent HENGTONG OPTIC-ELECTRIC valued at USD 20mn

offering PEACE redundancy in exchange for competitive

pricing on fibre optic cables

July

The company launched ‘WE SPACE’, a new shift in its

fixed broadband offering in line with its large project

to develop its network capabilities and improve the

quality of internet services in Egypt

Signed an agreement with Banque Misr to launch the

‘WE Wallet’. The service is designed to enable

customers to safely and securely send, receive and

store money using a smartphone application

Signed two virtual fixed voice agreements and two

bitstream agreements with Etisalat Misr to enable it to

provide fixed voice services, utilizing Telecom Egypt’s

network, and new VDSL technology to its customers

Signed a strategic partnership agreement with Cable

Network Egypt (CNE) to provide Telecom Egypt’s

customers with Internet Protocol television services

(IPTV) in collaboration with various content providers 24

Financial highlights

25

Revenue

(EGP mn)

EBITDA

(EGP mn)

Net profit

(EGP mn)

Operating Profit

(EGP mn)

Financial highlights

Double digit EBITDA growth helps maintain net profit in spite of heavy investments

13,950

18,567

22,771

FY 2016 FY 2017 FY 2018

+63.2%

+22.6%

3,801

5,184

6,130

FY 2016 FY 2017 FY 2018

+61.3%

+18.3%

1,991 2,023

3,560

FY 2016 FY 2017 FY 2018

+78.8%

+76.0%

2,670

3,052

3,484

FY 2016 FY 2017 FY 2018

+30.5%

+14.2%

26

Revenue by business unit (FY 2018)

Retail services & specifically data drives revenue growth

Home &

Consumer DomesticEnterprise

International

Carriers Affairs

International

Customers & Networks

FY 2018 performance:

Retail revenue grew 36% YoY relying heavily on strong data performance and higher ARPU.

Home & Consumer noted a growth of 42% YoY driven by the 45% higher data revenue.

Mobile revenue preserved almost the same pace across the year contributing a low single digit to the top line and a

high single digit to retail revenue.

Enterprise Solutions witnessed a 22% increase driven by the inflow of EGP 482mn in revenues from the schools’

connectivity project and the +13% YoY growth in fixed services.

Wholesale increased 12% YoY mainly driven by the Bharti Airtel agreement that contributed EGP 1.6bn to our financials

and the growth in infrastructure revenues.

Domestic Wholesale rose 8% YoY on the continuing demand for infrastructure leasing by domestic mobile operators.

ICA declined 9% YoY in line with the global trend of lower international voice traffic.

IC&N revenue grew 66% YoY on the completion of the Bharti deal in Q3 2018.

27

3,203

4,868

4,424

2,236 2,270

FY 2016 FY 2017 FY 2018 H1 2018 H1 2019

+38.1%

-9.1% +1.5%

4,228

5,662

8,064

3,764

4,940

FY 2016 FY 2017 FY 2018 H1 2018 H1 2019

+90.8%

+42.4% +31.2%

2,389

2,627

3,215

1,212

1,601

FY 2016 FY 2017 FY 2018 H1 2018 H1 2019

+34.6%

+22.4% +32.1%

3,004

3,304

3,571

1,965

2,250

FY 2016 FY 2017 FY 2018 H1 2018 H1 2019

+18.8%

+8.1% +14.5%

1,126

2,106

3,496

947

1,635

FY 2016 FY 2017 FY 2018 H1 2018 H1 2019

+210.4%

+66.0% +72.7%

39%

12%

18%

18%

13%

H1 2019

31%

14%

18%

26%

11%

FY 2018

Home & Consumer Enterprise

Domestic International Carriers

International Customers & Networks

Debt

restructuring

National

roaming

International

incoming calls

Energy

Monetizing

investments

Salaries

• Debt restructure

EGP to USD

Short term to long term

• Effective interest rate reached 9.1%*

Cost initiatives (FY 2018)

Managing cost challenges across different divisions

• Voluntary early retirement program

• Training and reshuffling employees across

several divisions to enhance productivity

• Hiring skilled caliber

• Amended national roaming agreement with Etisalat Misr,

receiving improved rates

• +20% of traffic is now hosted on TE’s network

• Revamping fixed & mobile price plans to

increase WE’s share of the customers’ wallet

• Optimizing the usage of unutilized assets

• Extracting synergies from existing assets

• Shutting down exchanges, which were

replaced with fiber to the curb

• Commercial offers to maximize

int ’l traffic on WE’s network

* Normalizing the EGP 135mn syndicated loan’s administrative fees

28

Historical 3 year income statement summary

Note: All financial figures reported are based on the consolidated financials under the Egyptian Accounting Standards

in EGP mn 2016 2017 2018Growth y/y

2017 2018

Revenue 13,950 18,567 22,771 33% 23%

Home & Consumer 4,228 5,662 8,064 34% 42%

Enterprise 2,389 2,627 3,215 10% 22%

Domestic Wholesale 3,004 3,304 3,571 10% 8%

International Carriers 3,203 4,868 4,424 52% -9%

International Customers & Networks 1,126 2,106 3,496 87% 66%

Total employee cost (4,629) (5,061) (5,216) 9% 3%

Call costs (2,587) (4,152) (4,295) 60% 3%

COGS (excl. above expenses) (2,229) (3,138) (5,116) 41% 63%

S&D (excl. salaries, D&A) (300) (533) (1,388) 77% 161%

G&A (excl. salaries, D&A) (403) (499) (624) 24% 25%

EBITDA 3,801 5,184 6,130 36% 18%

Margin 27% 28% 27% 67 bps (100 bps)

Other (income)/expenses (275) (1,056) 147 284% -114%

Depreciation (1,458) (1,841) (2,096) 26% 14%

Amortization (77) (264) (620) 243% 135%

Operating profit 1,991 2,023 3,560 2% 76%

Margin 14% 11% 16% (338 bps) 474 bps

Income from investments 668 2,337 2,201 250% -6%

Net finance (cost)/income 574 (382) (288) -167% -25%

Net interest (expense)/income 120 (264) (1,024) -321% 288%

Tax (680) (659) (958) -3% 45%

Net profit 2,670 3,052 3,484 14% 14%

Margin 19% 16% 15% (270 bps) (114 bps)

EPS 1.20 1.38 1.61 14% 17%

* EPS after appropriations

*

29

Cash flow analysis

Cash capex

(EGP mn)

Net cash from operating activities

(EGP mn)

Note: All financial figures reported are based on consolidated financials under The Egyptian Accounting Standards.

FCFF

(EGP mn)

In-service capex

(EGP mn)

* Including the one-off settlement payment to Etisalat Misr of EGP 919mn * Including the one-off settlement payment to Etisalat Misr of EGP 919mn

1,597

4,338

4,649

3,496

1,638 1,724

FY 2015 FY 2016 FY 2017 FY 2018 H1 2018 H1 2019

147

(2,603) (2,456)

(5,075)

(947)

3,288

FY 2015 FY 2016 FY 2017 FY 2018 H1 2018 H1 2019

2,609

3,312

6,088

8,028

3,465

-

5,294

1,420 780

49

21%

24%33%

35%

27%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

-

1,00 0

2,00 0

3,00 0

4,00 0

5,00 0

6,00 0

7,00 0

8,00 0

9,00 0

FY 2015 FY 2016 FY 2017 FY 2018 H1 2019

Capex License Capex/sales

3,159

4,731

7,336

8,499

3,669

5,294

3,340

26%

34%

40%

37%

29%

10%

20%

30%

40%

50%

60%

70%

-

1,00 0

2,00 0

3,00 0

4,00 0

5,00 0

6,00 0

7,00 0

8,00 0

9,00 0

FY 2015 FY 2016 FY 2017 FY 2018 H1 2019

Capex License Capex/sales

*

*

*

*

**

** Including the Vodafone dividends of EGP 4.8bn

30

62

(97)

1,191

797

673

843

FY 2015 FY 2016 FY 2017 FY 2018 H1 2018 H1 2019

69%

16%

5%

5%

4% 1%Access Network

Transmission

International cable

Customer care

IT

Others

Balance sheet highlights

FCFE *

(EGP mn)

Net debt

(EGP mn)

Net debt/ EBITDA

(Based on annualized EBITDA)

Breakdown of in-service capex

* Including the one-off settlement payment to Etisalat Misr of EGP 919mn

-0.6x

0.6x

1.3x

2.1x

1.6x

FY 2015 FY 2016 FY 2017 FY 2018 H1 2019

2,587 1,180 638 1,207 1,522

-389 -3,342 -7,293

-13,854 -11,681

-2,197 2,161 6,656 12,647 10,158

FY 2015 FY 2016 FY 2017 FY 2018 H1 2019

Net debt

Total debt Cash

*

*

FY 2018

31

0.61

0.41

1.65

(0.11)

0.36

0.56

0.75

1.00

0.25 0.25

(0 .30)

(0 .10)

0.1 0

0.3 0

0.5 0

0.7 0

0.9 0

1.1 0

1.3 0

1.5 0

1.7 0

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

EPS

DPS

106%

54%

83%

18% 16%

92%

182%

60%

236%

69%

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Consolidated

Standalone

0.53

1.40

1.20

1.38

1.61

0.61

0.41

1.65

-0.11

0.36

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Consolidated

Standalone

0.83

1.76

1.56

1.79

2.04

0.89

0.74

1.99

0.27

0.73

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Consolidated

Standalone

Dividend analysis

We aim to distribute a continuous stream of dividends, balancing distribution with

the reinvestment of our cash flows in Capex, which we view as the pillar for growth

EPS after appropriations

(in EGP)

EPS before appropriations

(in EGP)

Note: All financial figures reported are based on consolidated & standalone financials under The Egyptian Accounting Standards.

Payout ratio

(%)

Dividend distribution on standalone financials (based on regulations)

(in EGP)

32

H1 2019 highlights

33

H1 2019 results highlights

Strong topline performance

12.7bn+25% YoY

2.6bn-20% YoY

Normalized 3.6bn

+11% YoY

2.1bn+4% YoY

Normalized 2.9bn

+41% YoY

Revenue

(EGP bn)

EBITDA

(EGP bn)

Customers

(mn)

Net profit

(EGP bn)

Fixed

Mobile

Voice Data

EBITDA margin of 21%

Normalized margin of 29%

Net profit margin of 17%

Normalized margin 23%

8.2+11% YoY

5.5+19% YoY

4.3+29% YoY

Consolidated revenue grew mainly on increased

data and cable projects revenue, which represent

41% and 22% of total growth.

Customers grew across all segments.

Wholesale mainly grew on the +73% YoY IC&N

revenues mostly coming from the recognition of

PEACE cable revenues followed by the 14% YoY

increase in domestic revenue.

TE successfully completed the early retirement

program (ERP) with c2000 employees signing up,

accounting for a total expense of EGP 1bn to be

paid to the employees in Q3.

TE intends to finance c50% of the ERP through an

extraordinary dividend expected to be paid by

Vodafone Egypt in Q3.

EBITDA margin came in at 21% weighed on by the

recording of the ERP. Normalized, EBITDA grew by

11% and recorded a margin of 29%.

Net profit slightly increased in absolute terms.

Normalized net profit grew 41% YoY reaching EGP

2.9bn on a FX gain of EGP 850mn, EBITDA growth

and the rebound in investment income from

Vodafone Egypt.

H1 2019: normalized net profit +41% YoY

34

1 Education reform program

Pha

se

1Pha

se

2

Q3 2018: Connected 2,550 schools with fiber within 2

months, recognizing EGP 482mn.

Q1 2019: Provided data SIMs for students in their first year

of high school.

2 Port Said digital transformation

Pha

se

1

Pha

se

2

Q1 2019: Connected government service buildings in

Port Said with fiber to provide citizens with digital

services.

Connecting 5 more governorates with fiber (timeline to

be agreed upon later within the 2 year timeframe of the

protocol)

613kdata SIMs

4 daysto distribute the SIM cards

8,000

TE employees

working on the

project

670buildings

connected

service offices

included

700

further monetization

from service

subscriptions

further monetization

from connectivity

subscriptions

Projects in Q1 2019

Further steps towards nation-wide digital transformation

The offer: Data bundle price is EGP 5 for the 1st

GB then each student has to

subscribe to one of WE’s existing data bundles

EGP 86mnrecognized

revenue

35

• Employee costs include EGP 1bn related to the ERP, which will be paid in Q3. Normalized

employee costs rose 22% (excl. the ERP, the pension fund and the one-off bonus paid in

Q1).

• Advertising grew on seasonality as last year the seasonality hike was in H2.

• Call costs as a % of revenue dropped to 19% from 21% on enhanced revenue mix.

Income statement (H1 2019)

Re

ve

nue

EBITD

AO

the

r

OPEX

Ne

t p

rofit

• Home data revenue rose 37% YoY, representing 39% of total growth.

• IC&N contributed 27% to total growth, thanks to EGP 605mn from cable projects

revenues including the recognition of USD 20mn PEACE cable revenue.

Exp

ense

s

No

n-o

pe

ratio

na

l

• EBITDA came in at EGP 2.6bn, declining 20% YoY. Normalizing for the ERP, EBITDA

would have increased by 11% YoY reaching EGP 3.6bn and recording a margin

of 29%.

• Amortization and depreciation rose 25% YoY in line with our increased CapEx

rollout.

• The effective interest rate reached 7.6% compared to 10.6% in H1 2018 as a

result of settling our EGP denominated debt using Vodafone dividends.

• Net finance cost included a FX gain resulting from the appreciation of EGP vs USD

and relates to the revaluation of the USD denominated facilities.

• Normalized operating profit came in almost flat YoY.

• Investment income from VFE grew 29% as a result of the base effect due to

provisions taken in Q1 2018.

• Net profit slightly increased reaching EGP 2.1bn due to the FX gain. Excluding the

ERP cost, net profit would have come in at EGP 2.9bn, growing 41% YoY supported

by the FX gain, EBITDA growth & the rebound of investment income from

Vodafone.

Note: All financial figures reported are based on the consolidated financials under The Egyptian Accounting Standards

In EGP mn H1 2019 H1 2018 YoY Q2 2019 Q1 2019 Q2 2018 QoQ YoY

Revenue 12,696 10,125 25% 6,609 6,087 5,343 9% 24%

Home & Consumer 4,940 3,764 31% 2,539 2,401 1,935 6% 31%

Enterprise Solutions 1,601 1,212 32% 851 750 629 13% 35%

Domestic Wholesale 2,250 1,965 14% 941 1,309 1,085 -28% -13%

International Carriers Affairs 2,270 2,236 2% 1,141 1,128 1,140 1% 0%

International Customers & Networks 1,635 947 73% 1,137 498 554 128% 105%

Total employee cost (4,211) (2,375) 77% (2,587) (1,624) (1,173) 59% 121%

Total employee cost (Normalized) (3,207) (2,375) 35% (1,583) (1,624) (1,173) -3% 35%

Call costs (2,358) (2,093) 13% (1,224) (1,134) (1,079) 8% 13%

COGS (excl. above expenses) (2,370) (1,581) 50% (1,413) (957) (828) 48% 71%

S&D (excl. salaries, D&A) (821) (563) 46% (492) (329) (362) 50% 36%

G&A (excl. salaries, D&A) (299) (220) 36% (158) (141) (115) 12% 38%

EBITDA 2,637 3,293 -20% 735 1,903 1,787 -61% -59%

Margin 21% 33% (1,175 bps) 11% 31% 33% (2,014 bps) (2,232 bps)

EBITDA (Normalized) 3,641 3,293 11% 1,739 1,903 1,787 -9% -3%

Margin 29% 33% (384 bps) 26% 31% 33% (495 bps) (713 bps)

Other (expense)/income 62 142 -56% (25) 88 106 -129% -124%

Depreciation (1,224) (937) 31% (577) (647) (494) -11% 17%

Amortization (326) (300) 9% (162) (164) (149) -1% 9%

Operating profit 1,149 2,197 -48% (30) 1,179 1,249 -103% -102%

Margin 9% 22% (1,265 bps) 0% 19% 23% (1,983 bps) (2,384 bps)

IIncome from investments 1,125 874 29% 478 647 587 -26% -19%

Net finance (cost)/income 758 (159) 578% 365 394 (71) -7% 614%

Net interest (expense)/income (448) (404) 11% (166) (283) (200) -41% -17%

Tax (450) (447) 1% (129) (321) (279) -60% -54%

Net Profit 2,131 2,058 4% 516 1,615 1,284 -68% -60%

Margin 17% 20% (354 bps) 8% 27% 24% (1,874 bps) (1,623 bps)

Net profit (Normalized) 2,909 2,058 41% 1,294 1,615 1,284 -20% 1%

Margin 23% 20% 259 bps 20% 27% 24% (696 bps) (445 bps)

EPS 1.25 1.21 4% 0.30 0.95 0.75 -68% -59.8%

* EPS after appropriations

*

36

Our performance in context

Normalized KPI’s meet our guidance

Revenue growth YoY

EBITDA margin (%)

CAPEX / sales (%)

H1 2019

actual

25%

21%

In-service: 29%

Cash: 27%

Mid to high

single digit

Mid to high 20s

In-service: 30%

H1 2019

normalized*

25%

29%

In-service: 29%

Cash: 27%

FY 2019

guidance

* Excluding the early retirement program one-off of EGP 1bn

2018

actual

23%

27%

In-service: 37%

Cash: 35%

37

Thank you

Investor relations team

investor.relations@te.eg

Check our newly revamped website

ir.te.eg