Mtn Group Ltd Ord

Good afternoon everyone and welcome. It's my pleasure to welcome you to our interim results for the year and for the six months ended 30th June 2026. A warm welcome to everybody here in the room at MTN Innovation Centre including all the members of our investment community and the media. I also would like to welcome members of EXCO and any board members who've come. We also welcome everyone joining us remotely as well as all the MTN colleagues across our markets. Before we begin, let me cover a few housekeeping points. First, our standard disclaimer and safe harbor statement is displayed on our screen now. There you have it. And it applies to today's presentation. For those physically in the room, just in case of emergency, understand that is one exit and the other is on my right. For connectivity, the Wi-Fi details are now displayed on screen. I'll just pause a little to let you capture them. If you plan to share updates online, please use hashtag MTN Interim and tag our corporate accounts at MTN Group on X and at MTN on LinkedIn. A QR code for the whole results booklet is also displayed on screen for easy access. And finally, following this presentation, all guests in the room are invited to join us for cocktails and continue the conversation outside in the auditorium. Our agenda for today will begin with an operational and strategic review, followed by the Group's financial performance. We will then open the floor for questions. A reminder for all those on the webcast to please submit your questions through the platform, and we will read them from there and try to answer them. That brings us to the start of today's presentation. It is now my pleasure to invite the MTN Group President and CEO, Ralph Mukita, to stage.

Roy, thanks very much and extending my own welcome to all of you who have joined us here at our head office campus at 14th Avenue. We have some shareholders and broader stakeholders who are here and also to extend welcome to all the stakeholders joining us on the various virtual platforms and to the MTNs across our 19 markets you have delivered the results that we have the pleasure of showcasing to our stakeholders more broadly and so over the next 45 minutes we intend to take you through as Roy has mentioned the highlights operational strategic review financial overview and then the outlook and priorities that we have for the second half of the year Sulu Mulefe, our Group CFO, is not with us today. She's had a bereavement in the family. She lost her brother pretty recently and we're wishing her all the best during this difficult time to her and her family. So I will be presenting the financial overview that she would have ordinarily presented and the numbers that I'll take you through would be those that she and her team produced So going straight into the highlights, we've got six key messages that we'd like all the stakeholders to take away from the results. We trust that you've had the opportunity to read our SENS documents since we released it earlier this morning. The first message is that we've had very strong commercial momentum that's translated into strong growth and solid profitability. The results are broad-based. Nigeria Ghana continue to deliver very strongly but we've seen a good performance improvement particularly for markets such as Cote d'Ivoire Cameroon and Uganda have remained very resilient and I'll take you through the picture of where the performance is coming from the second is that the financial results have been pretty strong the top line when you look at a constant currency basis has grown 17.5% inside our medium term guidance range and we've seen EBITDA expanding more significantly than service revenue growth and the EBITDA margin that is reported at the end of the half is the strongest that we've seen certainly since around 2012 adjusting for accounting changes I-17 and IFRS 16 broadly this is the height that we've achieved in over a decade The third is really the story around FinTech reported service revenue below our guidance and there's three non-operating factors that have impacted the results that we've seen at just on 13.3% and I'll take you through that detail of those three non-operating impacts and if you strip those out the growth would be much closer to 19.3%. What is pleasing on the FinTech side is that we're seeing the ecosystem continue to be very strong, so transaction values are up over a third, close on to $331 billion of transaction value going through our network over the period. And the bond services which we see as the future-proof services to our customers continue to accelerate over 30%, 32% to be exact. The fourth message is really about earnings, returns and the equity free cash flow growth. I'll take you through a bridge view on the drivers between basic EPS to adjusted headline earnings per share. The adjusted headline earnings per share which were up 21.3% showed the underlying earnings momentum in the business. We saw also a very strong expansion on return on capital employed. We ended off the year, last year, just on 27.1 and we're closing the period for the first six months of the year at 31.5. The equity-free cash flow, which underpins our shareholder remuneration framework, grew a pleasing 32.7%. and when we look at the cash flow bridge we'll show you the quality of cash flow as well as cash conversion the fifth message is we're seeing good progress on the IHS transaction quite a complex transaction to get over the line we've had to be to see disposal of the latter methods there are tower companies in both Brazil and Colombia which have been disposed of and those cash proceeds have been rolled up to the group and there has also been the sale of the fibre business to TIM in Brazil and again those cash proceeds are part of the funding structure for the transaction. We saw also the EGM successfully held on the 4th of August and we are now going through the various regulatory approvals. One of the key regulatory approvals we called out with our results was a competition authority in Nigeria, FCCPC, where we've concluded our engagements with them and we have secured conditional approval. One of the key terms of the conditional approval is that we are going to do a further sell-down of up to 30% to local Nigerian investors on a commercial arm's length basis subject to market conditions and any of the proceeds from that will be used to pay down the debt stack that's in IHS. We'll give you a bit more detail on that. The sixth message is really around the share buyback program. We announced the share buyback as part of the shareholder remuneration framework, a composite of cash and share buybacks and the share buyback program over a three-year period. has a target of 6 billion Rand equivalent. We will repurchase the shares and cancel them on acquisition. So that's commenced. with the opening of the, you know, going into the open period and we're also reaffirming the medium-term guidance and we'll give you some color on how we're thinking about Nigeria, giving us the confidence, particularly when we saw the market reaction towards the Nigeria results and I'll cover that a little bit later. so just a little bit on the macro conditions that we operated in a couple of key messages they were kind of fairly supportive in the period we saw inflation coming down so when you think about the half year last year inflation was more around 14% that's just slightly over 9% on a blended basis across our markets our two major currencies both the Naira and the Rand fairly stable in the period what was What does create an effect to reported results is that the rest of African OCCOs were weaker against the South African Rand in the period. We make a call out also that the growth prospects as referenced by real GDP outlook they continue to be you know fairly robust so this giving us the confidence that the underlying demand that we see across the market will translate into you know strong financial results so when we look at the commercial momentum that we see in the business that I spoke about what are some of the key indicators we saw the subscriber base grow to just shy of 318 million subscribers served across our market let's say growth of about just under 7% active data subscribers grew much faster as we saw more and more of our customers using data service on a more regular basis and that you can see in the very strong data traffic that would have seen across our markets 14,338 petabytes of data traffic coming through our network on the fintech side we've just gone slightly under 71 million monthly active users The fintech ecosystem continues to be strong, 13 billion transactions by volume across the period by value $330.5 billion equivalent having grown by almost a third in the period. So where is this growth coming from? So this is another way of looking at what are the drivers of growth, subscribers, active data users and fintech monthly active users. So what you can see in this picture is that there is a broad-based contribution towards the growth. Subscribers in the period, part of the growth we saw, Nigeria, you see there on the screen, seven and a half million. But you also see that Ghana is growing. South Africa is flat. and then you see SEER and the Francophone markets also contributing to growth so this is a portfolio that is delivering the growth some of the markets are much more mature like South Africa some more nascent and give us a confidence that we will still see strong runway for growth so how does this translate into the financials looking at the financial contribution from growth earnings balance sheet and returns As I mentioned, service revenue 17.5% was really driving that data. When you look at data growth now, it's pretty much close to 50% of service revenue across our markets' data. It grew by 29.2%. I'll show you later that Voice is actually still fairly resilient in some of our markets, particularly if you look at markets XSA. But the big driver of growth is increasing data usage across our markets. Earnings, very strong growth and contribution. These are KPIs I've mentioned. The balance sheets remain strong and resilient. very low group leverage at 0.3 times the debt mix has improved considerably we have an outstanding euro bond of 500 million dollars which is due in October of this year and we well arranged to deal with that maturity as well as financing the IHS acquisition so that debt mix is very pleasing giving us shock absorbance capacity and the liquidity headroom has remained well above kind of what we see as the minimum that would want to see in the business. On the return side, the cash flow metrics all growing very strongly and as I said, reporting a nice jump in returns on capital employed over the period. So let us have a look at the operational review looking at our key markets starting with South Africa. I think South Africa is a tale of two halves. We've seen very good growth on postpaid, enterprise and wholesale. All these businesses growing well above inflation. The big drag on overall growth has been prepaid. Now within prepaid, one has to decompose it. You look at prepaid data, that has grown above inflation and you can see that in the charts on the left-hand side, we're starting to see a re-acceleration on prepaid data. The major drag is really around voice. We have, as we communicated with our results, full year results of last year, that we are on a deliberate reset to improve the quality of prepaid growth. We want growth that is less dependent on airtime advance. So we've pulled back quite sharply the extension of airtime advance into the prepaid base in South Africa. That used to be about 42%. It's now in the low 30s. We've stabilized the amount of that into the market. We've seen improving repayment rates within the month. October last year would have been saying $50,000 to $70,000. And with that deliberateness of pulling back the ESM advance, it does have an outside effect. on voice. Voice is more strongly correlated in the prepaid base to airtime advances and we think that this is the right set of actions to improve the quality of that base. There are other actions that we've taken around product simplification and those are ongoing and on the channel mix side starting to do more direct integration with the banks There are also kind of working capital positive effects of that and that is ongoing. So the recess is continuing and as we move into the second half of the year particularly focused on a recovery in prepaid voice we should start to see getting us back into growth for the full prepaid segment. Moving on to Nigeria, just a couple of key messages, Carl and the team reported results a few weeks ago, so very strong growth on the net addition side, data usage is pretty strong all around. The market conditions in Nigeria were characterized by a pretty stable Naira improved liquidity, the liquidity at the exchange rates that is You know prevailing does not present us with much difficulties. We've seen inflation moderating during the period But of course the big call-outs in the period was that there were higher global oil prices which translates into Higher diesel price our network in Nigeria is like 95% on diesel generators 5% on the grid and So diesel prices have flowed through into our cost structures. Just over 30% of OPEX within Nigeria is energy prices and that is substantially diesel and the way our contracts work, the cost in the quarter is the prior quarter's average diesel prices. So what we experienced in Q2 of this year will come into Q3, and then Q3 will come into Q2, and we'll talk a little bit about that. Notwithstanding that, we really pushed hard on capitalization. The capex intensity in Nigeria was over 20%. As we pursued growth in our mobile networks, and pushing hard on the significant home opportunity that we spoke about at the Capital Markets Day that we see in Nigeria. Pushing both a combination of fixed wireless access as well as fibre where we see the use case and the investment case for fibre to be pretty strong. The other big call out that I mentioned was we had a directive from the FCCPC which is a competition authority there to suspend airtime advance in April. Our posture, as always, is we take zero tolerance to regulatory sanctions and provisions. So we brought our airtime base down to a quarter of what the run rate would have been in quarter one. So that has had massive impacts on the revenue we would have generated between April, May, and June. Subsequent to the period ending we received communications from the FCCPC and we're back on a recovery path with the airtime advance and we're moving from a one vendor environment to four vendors that are now in the system. So in Q3 and Q4 we should start to see the build up back in terms of the whitelisted base where we can extend airtime advance in Nigeria. so that had a big drag on the service revenue in Q2 you see a 13% print including the airtime advance impact but if you were to strip that out that's kind of high 20s service revenue growth in Nigeria and there was also the base effect of last year's tariff increase which came fully into Q2 which creates a bit of a base effect and I'll come back to that in a subsequent slide. But I think what we are pleased with is that demand in Nigeria continues to be robust and whether you look at net additions and when you look at data usage growth, the demand is structurally strong and remains so in Nigeria. As I mentioned, one of the issues we saw was just the importance of communicating the two effects we saw in Nigeria. As I mentioned, the first is the base effect. So on the left-hand side of the chart, the graph is showing year-on-year increase of service revenue growth in yellow, and then the gray bars are showing you Compounded 2 Year Average, which is smoothing out some of those base effects. So what you can see between Q1 2025 and Q2 2025, a very elevated increase in the service revenue growth. That is when the tariff increase, the 50% tariff increase came into full effect. So it drove very strong growth in Q2, very strong growth into Q3. But when you start to look at a much more normalised 2 year CAGR you see that actually the growth is kind of more normalised The right hand side of the chart is telling another story around demand So we've indexed Q1 2025 to 100 up to Q2 2026 So we are now generating over 65% service revenue, absolute service revenue versus the first quarter of last year when the tariff increases came through. Those two effects including the extra time suspension are the major drags which reverse out as we move into the second half of the year and we are confident that The medium-term guidance framework we gave around Nigeria will be maintained on service revenue. On the EBITDA margin, we'll still be in range, but because of the higher energy prices, we see ourselves at the lower end of the range. The lower end of the range is around 53% EBITDA margin. Nigeria Ghana and that has some accounting effects that I'll explain a little bit later. We saw a slight weakness in the SETI versus the closing of last year and averaging out at 11.33 SETIs to the US dollar. The macro environment we see as relatively stable and we pushed quite hard in rolling out new sites and very strong CapEx additions in the period, rolling out new sites and again it's a market that we believe has got strong home connectivity potential. We saw a very strong growth in EBITDA and then EBITDA margin, our highest EBITDA margin we're generating across the business is in Ghana at 61.8% and very strong PAT growth. and you can see that data contribution to service revenue is pretty close to almost 60% now in Ghana where we see very strong growth and demand you saw Nigeria average customers using about 14.8 gigs Ghana is like 19 and the demand continues to grow in that particular market on FinTech as I mentioned the reported print and growth 13.3 and the non-operational items which I touched on too were really around the Uganda election shutdown of the mobile money system and of course Ghana is a big part of our FinSec platform second only to Ghana there was a change in the floats we were earning 4% on floats that was brought down to 1% and that had an impact and the final bridge point which I'll come to a little bit later is this extra time in Nigeria effect but as I mentioned earlier on the ecosystem continues to be strong we see high transaction volumes transaction values being very strong and advanced services which are the future continue to grow very strongly pleasing growth that we saw particularly around bank tech so that's up 78% the majority of our bank tech has been through partner banks. As we mentioned before, we'll start to incrementally do our own balance sheets lending as we look to acquire the appropriate licenses across several markets and we're seeing good growth on payments and e-commerce as well as remittances across the piece. Active agents have also grown and active merchants which gives us a sense of the capillarity of our network and usage across grew by 18%. 2.3 million active merchants that accept mobile money across our markets. In terms of our medium-term guidance, I think we're pretty pleased with most of the indicators. The key areas of work still to be done are South Africa. As I said, South Africa, if you diagnose a problem, the key issue is prepaid voice. The balance is actually growing pretty healthily, but that's a function also of deliberate steps that Ferdi and team have taken to improve the base quality and reduce the amount of airtime lending. and then FinTech at 13.3. We would call out that for the full year, we don't believe that we will be in the guidance range, particularly driven by the extra time impact that we've seen in Nigeria. Leverage is very healthy and as I mentioned, returns on capital employed remains at the top end of our own three-year outlook. Moving on to the financial review, let me just start off by addressing the material non-cash adjustments to earnings, which gives you a bridge view from basic earnings to adjusted headline earnings. There are three big items to call out here. The first is the impairment on re-measurement of our investments in 49% shareholding in Iran itself. given the macroeconomic conditions both the hyperinflation as well as the currency devaluation and on re-measuring that asset we took just on a 3.9 billion rand in payment that's 213 cents per share off our basic Fs the business the investment now is about 3% of adjusted headline earnings and about 7% of Group Net Assets. We have a carrying value there of about 10.5 billion Rand and obviously at the full year there is an opportunity to look at re-measuring that investment. The second are hyperinflationary effects with a couple of markets in hyperinflation Sudan, South Sudan and Iran is one of those the hyperinflation effect you see in Ghana is Ghana coming out of hyperinflation and the translation effects of that to the P&L that's another 22 cents that you see there then on foreign exchange there was some slight benefit from Nigeria but the big callouts were really around South Sudan where the currency of reference is the parallel market rate the official market rate is not accessible there is very limited foreign currency there so for all practical purposes the parallel rates and there was a massive devaluation of South Sudan Pounds and that's the 65 cents that you see there the upstreaming is Ghana upstreaming from Ghana to Dubai and the exchange rates depreciation there is the large contributor of that. So that's a repatriation set of issues. So when you reconcile all of that you get back to the $7.93 per share which was up 21% showing the underlying growth. Obviously these items are all non-cash and I think as you'll see later that the cash conversion from earnings to cash remains very strong across the group. I won't spend too much time on the P&L, many lines to analyze here, and some of them we've touched on, particularly service revenue and EBITDA. As you move down the P&L, I think some of the highlight points I've covered, FX losses you'll see increased by 31.9, largely explained, as I said, by South Sudan, and the repatriation of dividends out of Ghana to Dubai to the Group the Iran sale in payments so from a swing of profit from JV and Associates to a loss of 3.3 billion Rand equivalent we also saw through the improved profit before tax that actually the tax charge is much higher and you know we've seen the withholding taxes so as you repatriate we had a pretty strong cash Upstreaming half-year, $13.9 billion, so that attracts quite a bit of withholding taxes in the period. And the strong earnings of Nigeria and Ghana, with the minorities, you'll see that there's a strong share of minorities, about $4 billion that went through to non-controlling interests. Just walking through some of the elements of the P&L, I think a couple of key messages on the service revenue contribution. As I mentioned, data is now 50% of service revenue and the biggest contributor growing at 29%. I think a few call-outs. Obviously, all the bearers are in growth. Even Voice at 2.4, the growth is much higher when you strip out South Africa where growth in the half was a negative 10%. 0.4%, but a very healthy growth that you see digital services increasing their own contribution, wholesale being also a big part of, in particular, the South African business. If we look at the FinTech, coming back to FinTech again, kind of decomposing the revenue bearers, the basic services. The basic services grew relatively sluggish from our own performance and there were a couple of challenges. I mentioned Uganda because of the election shutdown. Advanced services I mentioned growing at 32%. and Airtime Advance actually contracted in the period. That's largely a function of suspension of Airtime Advance in Nigeria. When you look at the margin, the margin has come down slightly, 42.4%, but that's largely driven by the lower contribution of Airtime Advance. If you normalise for that, actually the margin is about 38.8%, which is still relatively healthy. And then you can see the mixed effect revenue contribution on the right hand side of the chart that slowly increasing the proportion of advanced services pretty much a third of total services from a revenue contribution side. As I mentioned, how did the 13.3% translate to 19.3%? The three drivers, the election shutdown for the whole system, we're out for over a week. Now, a week doesn't seem like a long time, but it's difficult to fill that week up over time, so that's 0.6 percentage points. The Ghana flow trade change, 4% to 1% as the inflation and rates came down. that compressed some of the earnings we would have ordinarily enjoyed and then the big impact is really our suspension of the extra time or airtime advance in Nigeria and you can see that bridge view to try and create a much more normalisation effect so obviously these are non-operational items but the team is working hard to try and reverse those Group Expenses Group Expenses 17.5 for service revenue growth so operating leverage coming through and you can see the total cost to revenue contribution coming down from just under 56% that is cost to revenue to just slightly above 52% When you look at where the big changes are, the big ones are really cost of sales. Some of that would have been on the extra time side, to be clear. But I think more importantly is the network leases and utilities. We have revised quite a lot of the tower contracts. and over the last couple of years they've given us some benefit and resilience when we look at the expense breakdown. So this is driving the operating leverage that's improving the EBITDA margins. We do make a call out because it's important to reference energy prices in a global environment where energy prices are relatively higher than we would have all thought. we thought it's important to reiterate that energy costs for the group are 15-20% and in Nigeria they're more between 30-35% in terms of OPEC's contribution and because diesel is the biggest component of total energy I think you can see that the movement in diesel prices has an impact on margins We have given the sensitivity before that says if you start off the year with diesel prices like 1,100 naira per litre and you move to 2,000, the sensitivity that will shave off 1.8 to 2 percentage points of EBITDA margin if you annualise it for the full second half of the year. So expenses are nicely managed and creating operating leverage. We've also benefited in the half with our continued expense efficiency program which generated about $1.2 billion of expense savings in the period. Moving on to EBITDA, obviously as I mentioned we've got a bit of jaws helping us here between service revenue and expenses. We see EBITDA growing just under 7 percentage points above service revenue and we are seeing this margin expansion H1 was a bit of a low for the group it had a bit of a Nigeria shocks that we experienced with the sudden currency devaluation and we burned through our distributable reserves we've built these back up in Nigeria and you can see a nice uptick on margin If you think about NTN as a business with several clusters, let's call them five clusters, we saw Nigeria expanding margins, there's expansion of margins in Ghana, there's expansion of margins in Francophone, Sia, there's a slight contraction that's largely to do with Uganda, and then in South Africa, if you strip out the share base payments, we would have had a slight margin you know, improvement, the share-based payments created a contraction. So there's broad-based contribution towards this margin improvement that you see. On CapEx, we capitalized about 16.6% in terms of CapEx intensity, that's just shy of 20 billion rands. Some of the markets where we're seeing foster growth opportunities like Nigeria and elsewhere, the capex intensity is much closer to 20% so this is the average of the portfolio and we anticipate that in this full year we will remain in that 15-18% that we try and manage the allocation of capex into building the networks the IT investments that are needed to grow our business so you can see on the right hand side of the chart that the majority of the capex in the half went into the network connectivity business as we pursue growth in the mobile network as well as in our home connectivity. Just on cash conversion, how are we translating earnings to equity-free cash flow? You can see there the bridge view and some key call-outs. Obviously, cash capex is a large item in the half. That was just under $23 billion. operating free cash flow before spectrum and licenses we didn't have much licenses and spectrum in the period that grew a healthy 23% then the free cash flow itself grew when you look at net interest paid and taxes were just on to 66% we got over 4 billion rand equivalent that was paid to non-controlling interests, minorities driving the equity free cash flow to just shy of 33% growth. And that is the base framework for our shareholder remuneration framework. On leverage and liquidity, again, very strong balance sheets, group leverage, as I mentioned, 0.3. As you see, cash upstreaming last year was about 8.2. This year, 13.9, very strong cash upstreaming from markets such as Ghana and Nigeria in particular. but we have cash up streaming from more broadly across the portfolio and we tend to have a much stronger second half of cash up streaming than the first half so this is pleasing to see the amount of cash up streaming that's come through in the half just under $14 billion and then when you look at our debt stack at the HOTCO level quite pleasing a good maturity profile this year as I mentioned we have the final of the euro bonds that we've had probably for the last decade that comes up for maturity in October and as I said we have the resources to deal with that and other investments that may be ongoing so very limited US dollar for sure when we bring IHS that kind of ramps back up and on a performer basis we see that moving from 0.3 times to about 0.8 in the way that we thought about the funding for the transaction. Just finally, just looking at the results and standing back, I think the key call out is kind of high quality growth and returns delivered in the first half. From the CapEx intensity, you see 16.6 EBITDA margin, as I mentioned, is very healthy. Strong returns and free cash flow conversion when we look at $92.5K. Just moving on to the outlook and priorities, which is the final section before we take any questions. Obviously the macro outlook remains uncertain, driven by global geopolitical developments that are out there. All of you read the same material that we do in trying to understand the forecast. These are not our numbers. These are numbers that we get from other agencies. But just showing that growth across our markets, sub-Saharan markets, is expected to remain fairly resilient. Inflation is expected to remain quite muted. There might be a slight tick up in Ghana according to the data sets that we see. But the main issues to watch out for into the second half is the direction of travel for inflation across the markets. where do the currencies move and of course energy prices because it affects the power inputs as well as direct expenses into overall emptying and Nigeria in particular so what are we monitoring amongst many things we monitor many things but we call out these four Global oil prices and how they translate into diesel costs Regulatory development, where are the spectrum acquisition opportunities Ghana I think is well known that the 5G is coming up in Ghana imminently There are a few others that are there South Africa, there is the end user regulations that is topical and in discussions with the authorities And obviously the geopolitical developments have second-order effects that we need to keep an eye on. Technology is always an area that needs focus. You get the technology shifts wrong, you know, the business will lose its footing. We're looking at how these AI frontier models are developing both in the west and in the east, how these open rate models are developing and their capabilities, at what cost points, You know, what token consumption, token economics go with those. These are things that Charles and the team are focused on as we deploy the AI ourselves internally. We have satellite partnerships and how we embrace them within our overall connectivity space. We do believe that there's a place for partnerships and we do believe that one has to take a market-by-market approach on how we deal with that. chipset pricing is really impacting handset affordability obviously the chip manufacturers can either direct demand to handsets or the big build out of data centers that's happening globally so we see that create a bit of a for the moment a barrier towards smartphone affordability and we have to work around that by finding financing solutions so these are some of the things that we're monitoring as we go into the second half and so one of our key focus areas they're pretty much the same as we spoke about with our full year results of FY 2025 deliver the prepaid recovery it's a deliberate reset and we're seeing pleasing momentum in that it'll take a bit of time we want to sustain the commercial momentum we're seeing across the business as I mentioned that we're seeing broad based growth One market which has been under pressure and used to be quite a significant contributor, particularly to Group Upstreaming, used to be Benin. And then within the Francophone market, the regulatory asymmetry has been removed, which is very helpful for us, particularly around price fall, because we have a big business there. We have strong market leadership, which are in team. So, Uche and Carl are working around that. So, we want to see that momentum coming through. We want to see momentum in Cote d'Ivoire. We want to see the strong growth in Cameroon, you know, come back and the recovery particularly around Uganda so that we have, you know, resilience within the portfolio and being able to drive the growth. And we have our FinTech commercial and strategic priorities. We are launching a new platform. We've spoken in the past that we need to build a new future fit FinTech platform. We're starting that in Nigeria as we speak right now. We did announce our partnership with Ant Financial. Serene and the team have done a lot of work around that platform. in Nigeria so I think we'll be able to launch in the next couple of weeks what we call MVP1 and so that we address all the latency and issues around the platform that has kind of hobbled up the progress that we would have wanted so very pleased that that is now in traction and looking at a variety of licenses across some of the markets and obviously the rebuild of airtime advance into Q3 and Q4 The fourth is continue to maintain capital discipline, cost discipline and maintaining this healthy financial profile for the Group and then obviously completing the IHS transaction. So on the IHS transaction, a few points before I wrap up and close. As we said before, the performer, from a performer perspective, transaction is a creative revenue and to earnings and I think we continue to believe that we'll carry on and translate and obviously we're going to have to fund the acquisition by raising some debt to fund a portion of the transaction. You will remember that we'll fund it both through the cash that the business has accumulated from operating cash resources as well as the sale proceeds from LATAM. Both of those would be used as buying out the 75% shareholders and then there will be about $1.1 billion that we need to raise to complete and that's all been arranged and we will be ready to act as soon as we meet all the conditions precedent. On the FCCPC, I think I need to be a little bit precise on this one, just so that you get the framing correct. We've agreed with the competition authorities to have 30% localization to Nigeria investors on an arm's length market basis subject to market conditions. And obviously we'd like to do it as quickly as possible, but they're all those, you know, provisors. Any proceeds from that sell down? for that part of the business will be used to reduce the IHS which obviously will reduce the total debt stack that we'll have on day one. so we'll see how that progresses once the transaction and we do anticipate that the transaction should close we had positive feedback from Kamesa on Friday with the FC, CPC and the two, the three major outstanding ones would still be the NCC Nigeria which we're engaging them with The competition authorities here in South Africa, with the size of the transaction from a ComCom, it will have to go through the tribunal, as is customary given the size of the transaction, and we also have CMAQ and ECOWAS still to go. So these are areas that Kolekila and his team, our M&A regulatory legal teams are working to try and get us some of the steps we've completed and the other ones seem on track if you have closed off second half of the year as the time period. So, ladies and gentlemen, thanks very much for listening to me the last, I think, almost 45 minutes. I've had to do the financial review. I haven't done it in several years, so hopefully it came out clearly. The medium-term guidance, we are reaffirming it. As we said, for this year, FinTech will be out of guidance, but over a three to five-year period, which is what our guidance is, we are maintaining that guidance at this period. Sheldon Remuneration Framework is in place, 40% to 60% of equity-free cash flow in this period that grew 32%, and we have initiated the buyback and appointed a broker. So that should commence, you know, has commenced effective today. So we have confirmed previously to you that at the end of each quarter, we'll report on how that buyback program has gone. So at the end of Q3, we'll give you some feedback. The investment case, which we spend a lot of time taking it through, With our capital markets there remains the core of how we think about the opportunity for digital and financial inclusion across the markets. We remain excited about it and committed to delivering the value that we're promising shareholders. With that Roy, I'll pause and I think open up for any questions. Thank you.

Thanks for that, Rolf. A big applause. You did two people's jobs. Before I go to questions in the room, some of the questions that have come online I think will cover a lot of the things that you're interested in, particularly the ones around South Africa. So I want to bunch them together and then I'll put them out there. So the first question is around the extra time rationalization. and its impact on data and voice in South Africa. So what the question is, is how much further do you need to go? What is an ideal level of extra time penetration? When do you think all of this bottoms out and you start seeing an improvement from a top-line perspective?

Yeah, I have Freddie in the room, so I'm not going to pretend to be Freddie Moorman and do his job as well. Freddie, can you get a mic to Freddie? who can talk about the initiatives around SA

Good afternoon everybody. So we've done a lot of work on extra time. We feel at this particular point in time that we've reached a level where we are comfortable to start pushing extra time into the market again. We've started doing this. Of course the concern is we must do it in a very responsible manner. We can't just go out there and push extra time. We could end up in a similar situation where we feel we were earlier where we were perhaps penetrating too deep and also penetrating in the wrong part of the market. But it's obviously substantial and it has a direct impact on revenue whether it's voice or data it just has an immediate direct impact on it.

While we still have you there, Freddie, one other question that keeps coming up is, is Celsi up to date with their payments and when will negotiations around an updated pricing framework for the roaming agreement be finalized?

So the relationship with Celsius I think is healthy and ongoing. Of course contracts of that nature are huge and complex and they also allow for parties to get together when it's required. So we are busy talking to Celsius at the moment. I've said before and I think it's important to reiterate again, I wouldn't like to provide more detail. We do have an NDA and it is very complex. So I wouldn't like to give more information on Celsius at this stage.

Thanks, Ferdi. Any questions in the room? Louise? Thanks for the opportunity.

Ferdi, maybe if we can stick with you on South Africa CAPEX. It seems you are spending, at the current run rate, half of that of your number one peers. Can you give us colour to these things that will accelerate into the second half? Can you hear me?

Yeah, we can hear you. CAPEX always accelerates in the second part of the year. We right now are busy with a substantial upgrade on our radio systems. We started, I think, about six weeks or seven weeks ago. So you'll see an increase in CAPEX. The rollouts have also been quite promising. We've seen a good improvement in quality and we've also seen data growth on the back of the CAPEX rollout. But I think it's fairly normal that it comes in towards the latter part of the year. SA's capex is a bit slower than Nigeria. Nigeria always goes a lot earlier. So you see it earlier, SA was a bit slower. And I think the other issue on the upgrade of the RAM, we had to go through quite an extensive procurement process as well. So it did take a little bit longer than what we anticipated.

Thanks, Buddy. And my second question is on the uncertain tax exposures contained in your contingent liabilities that has doubled year-on-year. Is this related to new tax assessments or with the penalties and the interest?

You know, new tax assessments across the portfolio, you know, from time to time you do have disputes with the tax authorities, whether the tax authorities, you know, look back and, you know, if we believe it's relatively certain, we'll put it through or put into provisions. So on a contingent basis, it will be communicating that there are new matters generally that we're dealing with.

Thanks Tim and thanks for taking our questions. Just on Ghana, business seems like it's growing quite nicely. Do we maybe just get a sense of what the growth profile and sort of runway is for that business? And if it is indexed to home connectivity, how should we be thinking about potential cannibalization of other revenue streams and the capital intensity?

Yeah I mean I think as you say Ghana has had a good runway and I think capital markets the big question was how long can this last and obviously we're saying to the team keep pushing. I think the big growth vector for Ghana you know going forward is you know we'll move from mobility to home and when I say in the future I'm not talking about the next quarter or two but more structurally the next three years is we see a significant home opportunity in Ghana that we can that's addressable from our point of view and it will come in two forms obviously fibre and fixed wireless access we've been pushing fibre quite a bit now because we haven't had 5G spectrum so the potential for getting you know decent quantums of low band spectrum as well as the mid band spectrum is very attractive to us, just given the significance of the home opportunities and balancing between fixed wireless access and fibre. So that's a growth vector that we are encouraged by. Actually Ghana, if you look at the bearers, it's actually got a decent contribution from the other bearers such as digital as an example. But the big one would be that the balance sheet in Ghana can accommodate a level of debt to finance such spectrum acquisition without putting to peril the kind of earnings and cash upstreaming that we would ordinarily enjoy. So yeah, the margin is quite strong at 61.8, but the big thing for us would be seeing the home opportunity turn into series and returns.

Ralph, sticking with Ghana, a question, interesting one here. The Ghana EBITDA margin must be high enough that the regulator takes notice. It's pretty rare that you get asked about how you get margins down, but what flexibility do you have? And how do you think about the size of the Ghana business in the context of the Ghanaian economy?

Yeah, when Peso was having margins of 60s, no one was asking that question, I'm sure. Look, I mean, the reality is that we've invested very strongly into the market and through the cycle, so the market position we have and the returns we're generating is a function of sustained investment. So, we always say to authorities when they travel to markets is that, you know, part of the growth and size and the scale is actually a derivative of the investment. If you don't put investment, you won't get that growth. But if you put the investment, the growth will come because of the nascent demand. This is not all top line driven. So you saw voice in Ghana is actually pretty muted. It's really driven by data. And remember, we have S&P regulations still intact with like six or seven measures around our market behavior because of our scale. We are S&P in Ghana. So we already have, you know, restrictions around what we can and can't do in Ghana. The operating leverage has enabled these margins to get to where they are. You know, do we think that they will sustain at this level forever? I'm not sure we can stand here and say that. I mean, for us in Ghana, the important thing is continue to meet the demand that we see and make sure that we make a social contribution beyond just the taxes that we pay. And I think Stephen and team are very focused on that.

Thanks, Ross. Marie Wintler would like to know, the group plans this $6 billion buyback over three years. Subject to the share price being attractively valued, is it possible for you to do it much faster, like in a year?

Yeah, we can't give up that kind of information just yet. I mean our program has been $6 billion to be executed up to a maximum of 2028 and when we allocate the resources to a broker, but they go on and we give them a framework and a mandate let's see where they get to and see where we are end of each quarter and we'll be able to update I don't think I can say much more than that if I say more I think you'll have a sense of our own internal view of what is fair value and Murray we can't say more than that just my second question just on the SA business there's been

How much runway is there to keep going with that to remain competitive and how much longer before you start cutting into the muscle?

You know, what is important for the cost initiative is that it requires some structural change. This is not just simply getting vendors in and just asking for discounts. This requires us to do business and do work in a different way. So just an example of this to extensively use AI where we can. Just one example of a project is we did some POC in the Western Cape, used AI to help us Get more efficiency out of power consumption, which was very successful. So we will now take that product and roll it out through the rest of the country. So this cost initiative is much more structural in nature than just simply cutting. And I think there's still quite a lot of runway to go. It's going to take two or three years to actually unlock it because it is structural in nature.

In South Africa, what proportion of your voice data traffic is carried on spectrum that you access for spectrum sharing agreements? Is there a path to becoming self-sufficient and move away from the spectrum sharing in the short to medium term?

Yeah, so I think the first thing is, I mean Spectrum is the lifeblood of our industry and I was sitting with a network guy the other day and we were talking about the Spectrum itself and one of them came up with an analogy I think that is very valuable. When you look at a spectrum, it's like a highway you drive on. The more lanes you have, the quicker it flows. And even if we are carrying the substantial portion of the voice spectrum on our own frequency, you can always do with another lane or two. It just unlocks efficiency so quickly. So my view is we would always like to have as much spectrum as possible. I think to a large extent when you see what's happening in Nigeria and Nigeria's ability to grow at this level is largely due to the fact that they had a clear spectrum acquisition strategy that they could follow. So we will always want more spectrum. At the moment with the spectrum we have the majority of our traffic is carried on our own spectrum.

Just sparing you for the minute, a question on FinTech. On FinTech revenue growth, outside of the three factors impacting growth, growth remains below guidance. What interventions are you implementing that will accelerate growth in the near to medium term?

We have Serene here, but maybe I can start and Serene can top and tail. The real drivers for growth will be one, bringing back airtime advance to kind of Q1 levels. That's not a small number. You saw it took out five percentage points of growth just in the half. So that's a big driver. The second is advanced services, looking at accelerating. The big driver would really be around lending over the medium term. That whole lending stack and being able to have the right licenses and structures around per market and to make a difference that's got to be in Ghana and Uganda on our current portfolio and then over time of course Nigeria where we've got the Ant platform Serene is in the room Serene you know please add and subtract to my comments yeah I think you've answered it well so maybe what I want to add is around basic services which decelerated faster

because we needed to adjust our tariffs in some markets like Cameroon which is our third largest market and we have wave entering there and we needed to adjust the prices so that in next year we'll see a better growth because we will move from we needed too much wave now we're going to grow again we'll see it next year so and Ralph mentioned some markets like Benin where also we have some competition pressure and we are looking at also adjusting but as he said the conditions have improved and we may not do that and have a better growth trajectory in Benin so these are the issues that we are dealing with but as he said advanced services are going quite well and we are looking at accelerating lending which will help to grow faster.

Ralph, what do you see as the impact of dealing with four parties for airtime credit in Nigeria? Does it increase the complexity? Does it allow you to get your target a lot quicker or does it contribute more to NPLs?

Look, I think the key thing is we are working within a regulatory framework that says you have to have more than one provider. so there are four that have been licensed or been allowed to operate in Nigeria so we are going to be optimizing the whitelisted base where we're getting the best performance so the team Carl working with Serene will be looking at that base and saying allocating the whitelisted base to where we're getting best performance so it will create a bit of kind of competitive dynamics but we are trying to optimize revenue maximization within that regulatory framework. So for some of them that haven't had the experience of our base and the kind of machine learning that comes with it, it will take them a little bit of time. so that's why you can't expect us in this quarter to all of a sudden by the end of the quarter look like we were in Q1 because there's some learning effects but I think that will improve quite a bit as we go into Q4 Carl and team and Serena have not reported to date this is early days that there are any concerning patterns so there will be a dynamic allocation across the four, great performance, more that will be off the white listed base will be provided. And we'll give you a sense by Q3 how that is all working out.

Any more questions in the room? So our question centers around the guidance that you provide. Given the reaction to the Nigeria slowdown, how has this changed how you intend in future to communicate temporary disruptions or headwinds. If there are any changes that have been made to guidance, could you perhaps give us what those changes have been?

The environment that we operate in is very dynamic. The markets we operate in are not linear markets. They are fluctuations from time to time. You get an enforcement action that says disconnect, you disconnect. So, and our approach is to manage to also have a risk lens on it. The guidance we give is a medium term guidance. So, you know, we guide three to five years is because we know that there are fluctuations in between quarters. So, we'll never give you a quarterly guidance because we just know that we are going to be wrong. But through the cycle, we feel strong. So, on Nigeria, just to kind of come back to Nigeria, is that our there are two effects that reverse as we move out of as we go into H2 the first is the tariff increase normalization I think you'll see it really slowing down as we are in Q4 you saw that graph the year on year growth is high in Q2 it's lower in Q3 but still relatively high and kind of normalizes by Q4 now we're still seeing net additions so net new customers coming onto our network 2.7 in Q1 they're consuming more data 14.8 gigs per customer 15% rise so there's base effects that you need to look at and saying are we you know can Carl and the team continue to bring more users onto our network and can those users use more and more data services so looking at that and the The second impact, which is really restoration of airtime advance, gives us the confidence as we do our planning and forecasting that meeting 20% is doable this year, certainly this year, although the guidance is multi-year. And for this year, because we see where energy prices are, we'll be at the lower end of the range. We won't finish the year at 55+. You know, we've seen a collapse in diesel prices sometime between now and the end of the year for that to be true so we are guiding much lower to the end of the range so we feel confident we see the growth it's a dynamic market and some of these impacts on a quarterly basis reverse out quickly so we are pretty confident on the growth prospects of a market like Nigeria

Maybe the last question online. Are there any markets where you see room for in-market consolidation and where are you seeing the ability to price up in the face of where inflation is going?

Yeah, look, I mean, I'm going to sound like Stack Records here. Look, I mean, many of the markets we're operating have, you know, moved to basically a two and a half player market. And I think if you look globally where you're seeing consolidation, whether it's in Europe This consolidation in the UK, if there was consolidation in Europe more generally, and parts of Asia, India is effectively a two and a half player market. The markets that are attractive and able to attract sustained investment and generate attractive economics are generally two and a half max three player markets globally. So when you have a Plutora, not that we're saying competition is not good, but actually you know almost counter factually what you're finding is you know for all of you here who are looking at the most recent merger in the UK I don't need to name who it is there's a report that's come out that says a couple of things happen in consolidation it's actually sustained or increased investment the customer does not suffer rising prices they stable or they fall and actually the market is more attractive so you know Nigeria's effectively a two and a half player market good economics coming out of that you see similar in Uganda Ghana's a little bit different in that quite a few players pulled out with S&P so the market that's got a structure which is at the global level not as attractive would be South Africa because the profit pools in South Africa are too small for the number of players to sustain the level of investment. So South Africa, and I think I've said it so many times, is a market that screams for consolidation at some point in the future because there are not enough profit pools to sustain the significant investment that you would need, which you're seeing in other markets where the competition frameworks or the markets in general are consolidating but also providing more investments and consumers have more choice and prices are staying the same or actually falling. So we'll see what happens over the medium term.

Thanks, Ralph. I think you've answered all the questions that came online and from the audience. For the people in the room, please join us in the foyer for drinks. We can continue the conversation. I want to thank you for spending this time with us for the patience of going through all these slides and our update and till next time. Thank you.