1H 2011 RESULTS

ANALYST BRIEFING

24 August 2011

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preparing the presentation. However, the Company’s forecasts presented in this presentation may vary from actual financial results, and these

variations may be material and, accordingly, neither the Company nor its directors or officers can give any assurance that the forecast

performance in the forecasts or any forward-looking statement contained in this presentation will be achieved. Details of the forecasts and the

assumptions on which they are based are set out in the presentation.

This presentation may not be copied or otherwise reproduced without the written consent of TM.

Disclaimer

Performance Overview

Financial review

Operating highlights

Concluding remarks

3

Key Highlights 1H 2011

4

Unifi takeup continued to exceed expectations – 12% takeup

Normalised EBITDA margin improved by 0.9pp to 33.7%

Revenue up by 2.5% to RM4,381.8mn compared to 1H2010 propelled by continued growth in Internet and Data

Normalised PATAMI up by 29.4% to RM257.5mn

Key Operating Indicators

Key Highlights 2Q 2011

Financial Performance

Improved QoQ and YoY performance

2Q11 vs1Q11

5

Operating revenue increased by 4% QoQ and 3.8% YoY to RM2,233.6mn in 2Q11 from higher contribution from data and internet & multimedia

EBITDA for 2Q11 up 2.2% QoQ and 8.8% YoY to RM746.9mn, Normalised EBITDA up 5.3% QoQ and 10.4% YoY to RM768.0mn

Reported PATAMI up 2.3% YoY to RM127.2mn, Normalised PATAMI up 10.5% QoQ and 20.8% YoY to RM135.2mn

Streamyx customers continued to grow by 11.7% YoY

Unifi takeup increased from 63,541 to 109,019 customers on the back of 904,000 premises passed

2Q11 vs2Q10

Note: changes are on Normalised basis

0.3

2.7

7.0

24.7%

10.9%

1.11.21.4

Cash Balance (RM bn) 2.1 3.5 3.5

2008

Capital Expenditure, excluding HSBB(RM bn)

Our capital management approach is guided by two major principles :

Striving to optimize capital productivity and ROIC

Creating shareholder value with strong commitment to dividend policy

1 TRS: Source Bloomberg2 After capital distribution and final dividend3 Normalised EBIT / Total Revenue

16.7 14.1

2009 2010

12.8

Focus on Shareholder Value CreationGrowing enterprise value through improving return on capital

1Total Return to Shareholder (TRS)

7.7% 42.9% 24.0%

EBIT Margin 10.8%10.9% 10.6%3

Capex / Revenue ratio( %)

6

2

1H11

Performance Overview

Financial review

Operating highlights

Concluding remarks

7

Note: EBITDA Margin is calculated as percentage of EBITDA against Revenue + Other Operating Income* Excludes FX (Gain )/Loss

RMmn

ReportedComments

(1H11 vs 1H10)

2Q11 1Q11% Change

QoQ2Q10

% Change YoY

1H11 1H10% Change1H11 vs

1H10

Revenue 2,233.6 2,148.2 +4.0 2,150.9 +3.8 4,381.8 4,275.8 +2.5Continued higher data and internet revenue

Other Operating Income

34.8 21.3 +63.4 29.6 +17.6 56.1 60.5 -7.3Lower due lower gain on sale of assets and sale of scrap

EBITDA 746.9 730.9 +2.2 686.2 +8.8 1,477.8 1,406.2 +5.1Higher YoY due to higher revenue and lower operating cost.

EBITDA margin 32.9% 33.7% -0.8pp 31.5% +1.4pp 33.3% 32.4% +0.9pp-

Normalised EBITDA 768.0 729.0 +5.3 695.5 +10.4 1,497.0 1,421.6 +5.3 -

Normalised EBITDA Margin

33.9% 33.6% +0.3pp 31.9% +2.0pp 33.7% 32.8% +0.9pp -

Depn & Amort. 511.4 500.0 +2.3 477.5 +7.1 1,011.4 934.3 +8.3Higher due to higher asset base and new asset additions

Net Finance Cost* 41.0 42.7 -4.0 63.6 -35.5 83.7 135.9 -38.4Higher interest income and lower interest expense

FX (Gain) / Loss (11.1) (38.4) -71.1 (23.0) -51.7 (49.5) (180.5) -72.6

RM continued to strengthen vs. USD by 6.7% [USD1:RM3.24 at June 2010; USD 1: RM3.02 at June 2011]

Profit Before Tax 207.1 227.3 -8.9 166.9 +24.1 434.4 519.5 -16.4

PATAMI 127.2 163.3 -22.1 124.4 +2.3 290.5 367.3 -20.9 Lower due to lower FX gain

Normalised PATAMI 135.2 122.3 +10.5 111.9 +20.8 257.5 199.0 +29.4 -

Group Results 1H11

8

In RM mn 2Q10 1Q11 2Q11 1H10 1H11

Reported EBITDA 686.2 730.9 746.9 1,406.2 1,477.8

Non Operational

ESOS (Income) / Cost - net 0.3 - - 12.1 -

FX (Gain)/Loss on International trade settlement

7.9 (2.3) 20.7 2.2 18.4

(Gain)/Loss on sale of staff housing loans 1.1 0.4 0.4 1.1 0.8

Normalised EBITDA 695.5 729.0 768.0 1,421.6 1,497.0

Normalised EBITDA Margin 31.9% 33.6% 33.9% 32.8% 33.7%

Reported EBITDA Margin 31.5% 33.7% 32.9% 32.4% 33.3%

Normalised EBITDA

EBITDA is calculated as Total Revenue (Operating Revenue + Oth. Operating Income) less Operating Cost (Exc. Depreciation, Amortisation & Impairment).EBITDA Margin is calculated as percentage of EBITDA against Total Revenue

9

Better due to higher operating revenue

In RM mn 2Q10 1Q11 2Q11 1H10 1H11

Reported PATAMI 124.4 163.3 127.2 367.3 290.5

Non Operational

ESOS (Income) / Cost - net 0.3 - - 12.1 -

FX (Gain)/Loss on International trade settlement

7.9 (2.3) 20.7 2.2 18.4

(Gain)/Loss on sale of staff housing loans 1.1 0.4 0.4 1.1 0.8

Other (Gain)/Loss – net* 1.2 (0.7) (2.0) (3.2) (2.7)

Unrealised FX (Gain)/Loss on Long Term loans (23.0) (38.4) (11.1) (180.5) (49.5)

Normalised PATAMI 111.9 122.3 135.2 199.0 257.5

Normalised PATAMI

* Comprise fair value (FV) changes of FVTPL (FV through P&L) investment and gain/loss on disposal for AFS (available for sale) investments. 4Q10 included gain on disposal of AXIATA shares.

10

21.5 22.8

21.6 18.6

18.1 20.4

11.9 11.5

5.7 5.4

5.1 6.04.4 3.80.7 1.0

1H10 1H11

Bad Debt

Marketing Expenses

Supplies & material

Maintenance Cost

Other operating cost

Manpower cost

Direct cost

Dep & Amortisation

Revenue = Operating Revenue + Other Operating Income

Cost % of Revenue1

Note: The classification of cost is as per financial reporting

(Please refer to Appendix for quarterly details & breakdown)

Improvement in Cost/revenue ratios will continue to be emphasized

1

11

RM mnRM mn

Total Cost / Revenue ( %)

RM3,864.4

89.1%

RM3,971.5

89.5%

1H2011 vs. 1H2010

• Higher Depreciation & Amortisationmainly due to higher asset base andnew asset additions

• Lower Direct Cost mainly due tolower interconnect andinternational outpayment

• Higher Manpower cost mainly dueto higher staff benefits

• Lower marketing expenses mainlydue to lower A&P

• Lower Other Operating Cost mainlydue to lower professional charges &fees, rental and internationalservices

348395

230

274

226 80

0

100

200

300

400

500

600

700

800

900

1H10 1H11

Access Core Network Support System*

182246

146

176

14020

0

50

100

150

200

250

300

350

400

450

500

1H10 1H11

Access Core Network Support System*

166 149

84 98

86 60

0

50

100

150

200

250

300

350

400

1H10 1H11Access Core Network Support System*

Group Capital Expenditure

** Gross capex to be shared with Government equally1H2010 capex has been restated to include IPTV

Note: Government grant treated as deferred income, to be amortised progressively to match against the depreciation of assets

*Include Application, Support System &Others (building, land improvement, moveable plants,application & other assets)

Capex spend in line with plan

12

Total Capex

HSBB Capex**

Note : BAU – Business As Usual

RM mn

804

468

18.8

BAU Capex

336

7.9

Capex / Revenue ( %)

442

307

7.0

749

17.1

30 June 11 31 Dec 10 30 June 11 31 Dec 10Return on Invested Capital 6.04% 6.03% Gross Debt to EBITDA 1.92 2.09

Return on Equity 7.16% 7.67% Gross Debt/ Equity 0.87 0.72

Return on Assets 4.78% 4.73% Net Debt/ Equity 0.47 0.27

Current Ratio 1.67 1.62 Net Assets/Share (sen) 186.5 216.1

WACC 6.58% 6.58%

2

30 June 11

2 Based on Normalised PATAMI, comparative for Dec’10 is amended to be consistent with current year computation

30 June 11

Group Cash Flow & Key Financial Ratios

31 Dec 10

RM mn 1H10 1H11

Cash & cash equivalent at start 3,490.2 3,488.0

Cashflows from operating activities 954.0 936.7

Cashflows from / (used-in) investing activities (485.7) (683.9)

Capex* 492.9 338.7

Cashflows from financing activities (357.5) (1,077.5)

Effect of exchange rate changes 0.7 1.8

Cash & cash equivalent at end 3,601.7 2,656.9

Free cash-flow (EBITDA – Capex) 913.3 1,139.1

•net of HSBB grant received from Government (1H11 – 410.3mn, 1H10 - RM311.1mn)

Strong Cash Balance to support futurebusiness requirements

1

Based on Normalised EBIT1

1

13

31 Dec 10

Performance Overview

Financial review

Operating highlights

Concluding remarks

14

Voice45%

Data19%

Internet20%

Others16%

Voice43%

Data20%

Internet21%

Others16%

341 346 345

698 691

2Q10 1Q11 2Q11 1H10 1H11

402 453 488 805 941

2Q10 1Q11 2Q11 1H10 1H11

425 425 455823 880

2Q10 1Q11 2Q11 1H10 1H11

982 924 9461,950 1,870

2Q10 1Q11 2Q11 1H10 1H11

Group Total Revenue by Product

15

Data

RM mn

RM mn RM mn

Voice

Others

Internet1H11

1H10

RM mnRM mn

RM mn

RM4.382mn

RM4,276mn

Note: 2Q2010 revenue reclassified from internet to voice

+2.4%

-3.7% -4.1%

+7.7%

+21.4% +16.9%

+7.1%

+7.1% +6.9%

-0.3%

+1.2% -1.0%

Retail78%

Global10%

Wholesale9%

Others3%

83 79 73152 152

2Q10 1Q11 2Q11 1H10 1H11

215182 192

417 374

2Q10 1Q11 2Q11 1H10 1H11

Retail79%

Global9%

Wholesale9%

Others3%

187 190 188377 378

2Q10 1Q11 2Q11 1H10 1H11

557 592 599 1,118 1,191

439 440 467 876 907372 337 387

718 724297 328 327617

655

2Q10 1Q11 2Q11 1H10 1H11

Consumer SME Enterprise Government

Group Total Revenue by Line of Business

16

1H11

1H10

RM4,382mn

RM4,276mn

* Others comprise of revenue from Property Development, TM R&D, TMIM, UTSB and MKL

Retail Wholesale

RM mn

RM mnRM mn

RM mn

1,7811,6971,664

Note: Due to lower IRU sales and reduced traffic minutes

Global Others*

+5.5%

-10.7% -10.3%

3,3293,478

-7.6%

-12.0% +0.0%

+4.9%

+7.0% +4.5%

-1.1%

+0.5% +0.3%

1,499 1,761 1,4926,608 7,894 9,149

746772 940

4,3745,357

6,962

1Q10 2Q10 3Q10 4Q10 1Q11 2Q11Other States Klang Valley

2,763 2,775 2,794 2,799 2,710 2,692

1,553 1,558 1,533 1,535 1,607 1,596

0

1,000

2,000

3,000

4,000

5,000

1Q10 2Q10 3Q10 4Q10 1Q11 2Q11

Residential Business

1,212 1,261 1,311 1,393 1,417 1,425

273 280 285 287 291 296

0

500

1,000

1,500

2,000

1Q10 2Q10 3Q10 4Q10 1Q11 2Q11

Residential Business

In thousand

In thousand

-1.0%

+11.7%

-0.7%

1,485

+0.8%

4,316

Physical Highlights

Streamyx Customer Growth

Fixed Line Customer Growth

WiFi Hotspot Zones

2,245

+536.0%

+21.6%

*Call Usage Only ** Streamyx Gross ARPU only ^ Streamyx Net ARPU

Net adds (in thousand)

1,541

+56

2,533

4,333

2,432

4,327

+55

1,596

10,982

+84

1,680

4,334

Note: inclusive of NBI initiative

17

Broadband champion - with continued growth in all segments

+28

1,708

4,317

13,251

ARPU (RM) 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11

Fixed Line* 35 35 35 34 33 34

Streamyx Broadband** 82 81 77 78 77^ 77^

1,721

+13

4,288

16,111

3,60312,456

28,771 55,15693,107

448

1,445

4,1258,385

15,912

2Q10 3Q10 4Q10 1Q11 2Q11

Residential Business

UniFi – leading & shaping the future

18

1

UniFi update as at 18 August 2011

2

4

Delivered 973,000 premises passed covering 76 exchanges, launched Unifi in Melaka

Signed HSBB Services Agreement with 2nd

access-seeker on 3 June 2011 for HSBB(Access) services

HSBB ARPU as at 30 June 2011 is RM186

Unifi takeup going strong

3

Activated more than 142,000 customers 4,051

13,901

32,89663,541

+71.6%

+10

Net adds (in thousand)

109,019

+19 +31 +45

+2591.2%

Performance Overview

Financial review

Operating highlights

Concluding remarks

19

Key Takeaways

Financial Performance

• TM Group revenue up by 2.5% compared to 1H2010 drivenby internet and data

• Normalised EBITDA margin improved by 0.9pp to 33.7%• Normalised PATAMI up 29.4%

Broadband Champion

• Streamyx customer base continues to grow

• HSBB at present:

• Strong Unifi takeup: more than 142,000 customers andgrowing

• 973,000 premises passed

Capital Management

• Capex/Revenue ratio improved from 18.8% to 17.1%• Cost management remains our focus

Shareholder Return

• Single-tier interim dividend of 9.8sen per share orapproximately RM350.6mn to be paid to shareholders in linewith our full year dividend commitment.

Appendices

2Q10 1Q11 2Q11 1H10 1H11 1H11 vs 1H10

Operating Revenue (RM mil) 2,150.9 2,148.2 2,233.6 4,275.8 4,381.8 -

Other Operating Income(RM mil)

29.6 21.3 34.8 60.5 56.1 -

Direct Costs % 21.9 18.6 18.6 21.6 18.6 Lower interconnect and internationaloutpaymentRM mil. 477.1 403.1 422.0 935.8 825.1

Manpower % 17.3 20.8 19.9 18.1 20.4Higher staff benefits

RM mil. 376.2 452.2 452.4 786.8 904.6

Supplies & Materials % 5.0 5.0 6.9 5.1 6.0 Higher customer acquisition cost, cable costRM mil. 109.8 108.5 156.1 221.0 264.7

Bad & Doubtful Debts % - 1.7 0.5 0.7 1.0 Higher trade bad debts from consumer & SMERM mil. -2.6 35.9 10.3 31.0 46.2

Marketing Expenses % 4.8 4.3 3.3 4.4 3.8Lower A&P

RM mil. 104.9 93.9 74.4 192.6 168.3

Maintenance Cost % 6.3 4.7 6.0 5.7 5.4 Reversal of over provision for 2010 and February 2011 (RM1.4m)RM mil. 136.9 102.9 136.9 247.4 239.8

Other Operating Costs % 13.4 11.2 11.9 11.9 11.5 Lower professional charges & fees, rental and international services RM mil. 292.0 242.1 269.4 515.5 511.4

Depreciation & Amortisation % 21.9 23.0 22.5 21.5 22.8 Higher asset base and new assetadditions RM mil. 477.5 500.0 511.4 934.3 1,011.4

Total (RM mil) 1,971.8 1,938.6 2,032.9 3,864.4 3,971.5 -

Total (%) 90.4 89.4 89.6 89.1 89.5 -

Cost % of Revenue

22

6,673.6

142.3

9,269.2

5,754.5

1,699.4

1,783.3

32.0

16,085.1

6,258.7

1,816.4

526.2

2,657.3

1,258.8

3,744.9

3,063.7

36.2

645.0

2,513.8

12,906.9

664.4

16,085.1

7,709.4

150.8

8,630.3

5,506.0

1,664.2

1,432.1

28.0

16,490.5

6,938.5

1,801.5

527.8

3,488.5

1,120.7

4,289.5

3,639.2

26.0

624.3

2,649.0

13,112.1

729.4

16,490.5

Shareholders’ Funds

Non-Controlling Interests

Deferred & Long Term Liabilities

Long Term Borrowings

Deferred Tax

Deferred Income

Derivative financial liabilities

Current Assets

Trade Receivables

Other Receivables

Cash & Bank Balances

Others*

Current Liabilities

Trade and other Payables

Short Term Borrowings

Others *

Net Current Assets

Property Plant & Equipment

Other Non-current Assets

RM MillionAs at 30 June 2011 As at 31 Dec 2010

Group Balance Sheet

23

* Included disposal group held for sale (Telekom Smart School)

1,594 1,554

428 486

799 933

672695

0

1,000

2,000

3,000

4,000

1H10 1H11

Others

Internet

Data

Voice

Consumer34%

SME26%

Enterprise22%

Government18%

806 769 785

220 229 257

400 448 485

339 343352

0

500

1000

1500

2000

2Q10 1Q11 2Q11

Others

Internet

Data

Voice

Consumer34%

SME26%

Enterprise21%

Government19%

Total Revenue By Products

RM mn +4.9%

1,664

1H11

+7.0%

RETAIL

Revenue by ProductRevenue by Business Unit

1H10

Note: Total revenue is after inter-co elimination. Revenue of product is before inter-co elimination

RM mn

RM mn

RM3,478mn

RM3,329mn

24

RM mn +4.5%

3,3293,478

1,6971,781

71 55 61

133 149 142

12 21 19

0

50

100

150

200

250

2Q10 1Q11 2Q11

Others

Data

Voice

140 116

267 291

28 40

0

100

200

300

400

500

1H10 1H11

Others

Data

Voice

ASP17%

MC83%

ASP17%

MC83%

MC : Malaysian CarrierASP : Application Service Provider

Others : Include internet

WHOLESALE

1H11

1H10

Note: Total revenue is after inter-co elimination. Revenue of product is before inter-co elimination 25

RM mn +0.3%

377 378

Revenue by ProductRevenue by Customer Segment

RM mn -1.1%

187

+0.5%

190 188

Africa & Middle East

9%

America8%

Europe9%

South Asia41%

North Asia13%

Oceania6%

Others14%

Africa & Middle East

8%America

7%

Europe11%

South Asia38%

North Asia17%

Oceania9%

Others12%

1H11

1H10

Others : Include internet

GLOBAL

Note: Total revenue is after inter-co elimination. Revenue of product is before inter-co elimination26

Revenue by RegionRevenue by Product

222 209

213178

14

4

0

100

200

300

400

500

1H10 1H11

Others

Data

Voice

RM mn -10.3%

417

374

109 102 107

11287 91

9

22

0

50

100

150

200

250

2Q10 1Q11 2Q11

Others

Data

Voice

RM mn +5.5%

215

-10.7%

182192

THANK YOUAny queries please email to : investor@tm.com.my

•Investor Relations• Level 11 (South Wing)•Menara TM •JlnPantaiBharu •50672 Kuala Lumpur, Malaysia • Tel (603) 2240 4848/ 7366 / 7388