Enriching Sri Lankan Lives

Dialog Axiata PLCSri Lanka's Premier Connectivity Provider

........

Investor Forum Q3 2011.. Investor Forum Q3 2011

an axiata company

Dialog Axiata Group

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Q3 2011 Group Performance Highlights

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Strong Financial Performance

Healthy growth in Group revenue driven by growth at Company and Subsidiary level

Group revenue up 5% QoQ and 10% YoY

EBITDA at Rs 4.3Bn increased by 14% QoQ; EBITDA margin strengthened by 2ppts to 37%

Exceptional gain in Q3 2011 due to recognition of TDF refund of Rs 342Mn normalised EBITDA growth of 5% QoQ.

Group PAT at Rs 1.4Bn up 1% QoQ and 4% YoYPAT growth inhibited by expansion of non-operating costs

Subsidiaries Consolidate EBITDA Performance DBN - 6th consecutive quarter of positive EBITDADTV - Consistent delivery of 20% EBITDA margin over 4 quarters

Group FCF comfortably positive for the seventh consecutive quarter with Q3 2011 FCF recorded at Rs 3.2Bn (3 fold increase QoQ)

Subscriber Growth Parameters

Mobile subscribers up 4% YoY

Pay TV subscriber base surpasses 200k in Q3 2011

Dialog Group: P&L HighlightsGrowth Momentum Consolidated with Strong 3rd Quarter

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(All figures in Rs Mn)

• Q3 Group EBITDA increase is due to the improved EBITDA at Company

• Group PAT increase QoQ by 1ppt due to higher EBITDA partly offset by higher depreciation, forex loss in Q3 and increase in deferred taxation charge

Q3 11QoQ

Change

YoY

Change9M 11

YTD

Change

Revenue 11,648 +5% +10% 33,664 +10%

EBITDA 4,339 +14% +8% 11,714 +5%

EBITDA Margin 37% +2pp -1pp 35% -2pp

PAT 1,392 +1% -18% 3,935 +4%

PAT Margin 12% -1pp -4pp 12% 0pp

1,384

520

(103)

(236) (168) (5)

1,392

PAT Q2 2011 Var. EBITDA Var. Depreciation Var. Net finance cost Var. Tax Var. Other operating income PAT Q3 2011

Rs Mn

5

Group PAT

Forex loss in Q3 (Rs. 232Mn)

Higher depreciation charge in line with network expansion

Group EBITDA and PAT

Higher network cost in line with expansion in thenetwork foot print, increased customer relatedexpenses and higher interconnect cost

Group EBITDA

3,819

585

(330) (77)

3,997 342 4,339

EBITDA Q2 2011 Var. Revenue Var. Direct cost Var. Opex Normalised EBITDA Q3 2011

one off TDF refund Reported EBITDA Q3 2011

Rs Mn +9%+5%

Higher deferred taxation charge

Group EBITDA Margin Analysis – Q3 2011

34.5%EBITDA Margin Q2 2011

N t k t

+ EBITDA margin impact (%)‐ EBITDA margin impact (%)

-0.4%

0.2%

-0.3%

Network cost

Regulatory cost

Direct cost

0.7%

0.7%

Staff related cost

Bad debt

0.2%

-1.0%

-0 3%

Other costs

Sales and marketing

Local interconnect cost

Higher advertising and marketing spend

-0.3%

34.3%

2.9%

Local interconnect cost

Normalised EBITDA Margin Q3 2011

One off TDF refund QoQ margin remains flat when normalized for TDF refund of Rs 342Mn

37.2%Reported EBITDA Margin Q3 2011

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Seventh Consecutive Quarter of Positive FCF

Capex* Free cash Flow (FCF)**

+13%

Free cash Flow (FCF)

Rs MnRs Mn

+73% +6% ‐31%

45%

55%

6,500 28% 27%

24%26%

36%

5,500

6,500

7,500 ‐61% +>100%

10%

28%23%

27%

10%13%

20%

15%

25%

35%

2,500

3,500

4,500

5,500

7,336

5,0469% 10%7%

15%16%

2,500

3,500

4,500

1,025 3,017 2,495

3,010

1,163 3,855

6,668

-5%

5%

Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 YTD 10 YTD 11

500

1,500

Capex Capex/Revenue

2,995

915 1,061 809

3,1767%

-4%

6%

Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 YTD 10 YTD 11(500)

500

1,500

FCF FCF/RevenueCapex Capex/Revenue FCF FCF/Revenue

Higher free cash flow in Q3 2011 due EBITDA growth and relatively low capex spending

Drop in QoQ capex based on project execution cycleand stringent monitoring of capital inventory

7* Capex - Additions to PPE & CWIP** FCF = EBITDA – Capex

capex spending

Gross Debt Position* 27,557 27,636 28,307 27,654 27,244

Gross Debt to EBITDA** 1.71 1.76 1.99 1.81 1.57

Net Debt to EBITDA** 1.47 1.41 1.43 1.26 0.99

Free Cash Flow (FCF) 2,995 915 1,061 809 3,176

FCF to Debt 43% 13% 15% 12% 47%

Current Ratio 0.93 0.88 0.90 0.82 0.95

Group Balance Sheet Deleveraged via Healthy FCF and Repayment of Borrowings

* Borrowings includes short term open LCs

**Annualized EBITDA = 4 times of quarterly EBITDA

(All figures in Rs. Mn.)

except for ratio’s Q3 10 Q1 11Q4 10 Q2 11 Q3 11 Trend

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Gross debt in Q3 2011 includes USD37.5Mn and Rs 3.7Bn interest-free loans from parent Axiata, Rs1.25Bn of redeemable preference shares, USD124.3Mn loan from OCBC and open LCs of Rs3.7Bn

USD8.2Mn OCBC loan was repaid in July 2011

Net debt to EBITDA improved to 0.99X in Q3 2011 from 1.26X in Q2 2011

Dialog Axiata PLC – Company

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Dialog Company: P&L HighlightsImproved EBITDA Driven by Growth in Revenue and TDF Refund in Q3

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(All figures in Rs Mn)

Increase in Q3 EBITDA due to higher revenue and TDF refund amounting to Rs 342Mn

Marginal decline in YTD EBITDA due to increase in operating costs by 16% due to;Costs expansion in revenue linked expenses and network operating costs in line with network expansionNon recoverable VAT expenditure arising from changes in VAT laws since January 2011

YTD PAT down 7% relative to the corresponding period in 2010, driven largely by higher deprecation arising fromexpansion of the access network and lower forex gain

Q3 11QoQ

Change

YoY

Change9M 11

YTD

Change

Revenue 10,677 +5% +10% 30,854 +10%

EBITDA 4,064 +15% +8% 10,882 -0.1%

EBITDA Margin 38% +3pp -1pp 35% -4pp

PAT 1,663 +3% -13% 4,649 -7%

PAT Margin 16% 0pp -4pp 15% -3pp

5,949 6,056 6,230 6,148 6,160

767

773 780 799 829

5,300

5,500

5,700

5,900

6,100

6,300

6,500

6,700

6,900

7,100

Q3 10 Q4 10 Q1 11 Q2 11 Q3 11

Postpaid Subs. Prepaid Subs.

Company – Operational PerformanceSteady Growth in RPM, MOUs and ARPUs Despite Intense Competition

No of Subscribers Pre : Post mix 88%

Post-paid

12%

Pre-paid

Blended ARPUs & RPM (Rs)

6,716

6,990

Total subs growth +4% yoy; +1% qoq

Postpaid subs growth +8% yoy; +4% qoq

Prepaid subs growth +4% yoy; 0.2% qoq

303 304 305

315

340

2.09 2.07 2.06 2.05

2.11

-

0.50

1.00

1.50

2.00

2.50

280

290

300

310

320

330

340

350

Q3 10 Q4 10 Q1 11 Q2 11 Q3 11

RP

M –

Rs.

AR

PU

-R

s.

Blended ARPU Blended RPM

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Subsidiary Performance

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Dialog Television (DTV): P&L HighlightsSteady Growth in Subscriber Base Driving up Revenue

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(All figures in Rs Mn)

6% QoQ increase in revenue on theback of 9% increase in subscriber base

7% QoQ decrease in EBITDA mainlydue to higher channel expenses509 503

561 564

598

16%

42%

23% 23%20%

-9%

15%

0% -2% -2%

-10%

0%

10%

20%

30%

40%

50%

Q3 10 Q4 10 Q1 11 Q2 11 Q3 11

440

460

480

500

520

540

560

580

600

620

Revenue - Rs Mn EBITDA margin PAT Margin

Q3 11QoQ

Change

YoY

Change 9M 11YTD

Change

Revenue 598 +6% +17% 1,722 +13%

EBITDA 118 -7% +47% 377 +>100%

EBITDA Margin 20% -3pp +4pp 22% +13pp

PAT (9) +21% +80% (23) +90%

Pay Tv Subscribers (‘000) 200 +9% +32%

Dialog Broadband Networks (DBN): P&L HighlightsSixth Consecutive Quarter of Positive EBITDA; Higher Opex Impacting Q3 EBITDA

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(All figures in Rs Mn)

604 589 584 580 608

29%20%

25% 27% 25%

-24%

-59%

-34% -35%-42%

-70%

-60%

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

0

100

200

300

400

500

600

700

Q3 10 Q4 10 Q1 11 Q2 11 Q3 11

Revenue- Rs Mn EBITDA Margin PAT Margin

Higher operating cost drove thedecrease in EBITDA QoQ

PAT impacted by lower EBITDA andhigher depreciation in tandem withhigher assets capitalised in the quarter

Q3 11QoQ

Change

YoY

Change 9M 11YTD

Change

Revenue 608 +5% +1% 1,772 +0.1%

EBITDA 154 -3% -13% 456 +>100%

EBITDA Margin 25% -2pp -4pp 26% +17pp

PAT (256) -25% -76% (658) +31%

CDMA & Broadband Subscribers (‘000) 198 +1% +5%

Thank You

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