SENS Note - 22 June 2011

MTN -- business update

At the annual general meeting to be held later today, Chief executive and president, Sifiso Dabengwa will make the following comments regarding the group's performance for the first four months of 2011 in comparison with the same period for 2010: The majority of the markets in which MTN operates have continued to show strong subscriber growth despite increased competition. The group increased its subscriber base by 7.4 million subscribers or 5% to 149 million customers for the four months to 30 April 2011 and has subsequently passed 150 million mobile subscribers across its 21 operations. Group revenue improved only marginally mainly as a result of the continued strengthening of the rand against the USD and increased competition. Due to political unrest, operational performance has been impacted negatively in Cote d' Ivoire and to a lesser extent in Yemen and Syria. The average rand/USD exchange rate to April 2011 was R6.86 compared to R7.48 in the same period last year. Had there been no movement in the exchange rate, revenue and earnings before interest, tax, depreciation and amortization ("EBITDA") would have been meaningfully higher. Total revenue was still driven primarily by voice revenue however non voice revenue contribution continues to increase. Group EBITDA margins were up when compared with the same period last year but in line with the overall margin at 31 December 2010. Margins in the majority of MTN's key markets remained robust. This was primarily due to the benefit of ongoing cost control and efficiency initiatives despite the negative impact of inflationary pressures and higher fuel costs. However, margins are under significant pressure in markets experiencing high levels of price competition. MTN`s spend on capital expenditure was lower than anticipated to the end of April mainly due to slower than planned rollout in Nigeria, South Africa and Ghana. However, a significant amount of the capital expenditure originally anticipated for the period has already been committed. It is expected that these projects will catch up in the second half of the year bringing the full year capital expenditure substantially in line with the original guidance. MTN South Africa sustained a sound financial performance in a relatively mature market as data maintained good momentum. The operation`s EBITDA margin continued to show a healthy trend upward mainly due to lower selling and distribution costs and to a lesser extent the containment of network operating costs. It is expected that the registration deadline on the 30 June 2011 will result in some disconnections. As at 22 June approximately 93% of the prepaid and 98% of the postpaid base had been registered. MTN Nigeria revenue growth slowed marginally as increased usage offset, in part, the decrease in tariffs implemented as part of a revised package offering in February 2011. EBITDA margins remained robust at the same level as those reported at 31 December 2010, despite the various competitive and operational challenges. MTN Irancell continued to deliver a solid performance growing local currency revenue in the high 20 percent levels when compared to the same period last year. EBITDA margins remained similar to those reported at 31 December 2010. MTN believes that its current initiatives place it in good stead to take advantage of value accretive opportunities while mitigating the various risks it faces. MTN will continue to leverage its scale, operational capability and intellectual capacity in an industry which has become more competitive as it matures and evolves. International operation The board has decided that the formation of a formalized subsidiary company board for the international operations will not be progressed at this point in time. This follows their review of the work completed by the sub-committee of the board appointed to investigate the matter. The information in this business update has not been reported on by the group's external auditors.

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