ANNUAL REPORT 2009

CONTENTS OTH ANNUAL REPORT 2009

Letter from Executive Chairman & Group CEO 02

About OTH:
OTH at a Glance 03
Financial Highlights 04
Organizational Structure 05
Financial Milestones 06
Financial Events 2009 07
Board of Directors 08
Corporate Governance Report 12
Corporate Responsibility Report 13

GSM Operations:
OTA 15
Mobilink 17
Mobinil 19
Tunisiana 21
banglalink 23
Telecel Globe 25

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koryolink 27
WIND Mobile 29 This year Orascom Telecom has exceeded the US$5.3 billion turnover mark, an

Ó
impressive result which also represents our strongest performance to date.
2009 Financial Review:
Board Report 31
Financial Statements (IFRS/US$) 39
Financial Statements (EAS/EGP) 62 Naguib Sawiris, Executive Chairman
 02
Letter from Executive Chairman & Group CEO
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Naguib Sawiris, Executive Chairman Khaled Bichara, Group CEO

Ò2009 demonstrated the strong resilience of
our business in increasingly volatile and
challenging global economic conditions.
Orascom Telecom has continued to focus on
its core strategic goals of creating shareholder
value through the continued growth of its
existing subsidiaries.
During the course of this challenging year,
Orascom Telecom has had to overcome a
series of hurdles: We were cleared to enter
the Canadian wireless market, and we
managed to attain our initial milestone of
launching WIND Mobile Canada before
Christmas. We have followed through on our
position of good faith with France Telecom,
which has culminated in an agreement
regarding Mobinil that is satisfying to both
parties, and will allow for us to concentrate
on maintaining Mobinil's leading position in
the Egyptian market. At the end of December
2009, OTH started a local appeal process
regarding the Algerian tax claim. The US$800
million rights offering gives us the time flexibility
to reach the most beneficial outcome in Algeria.
As always, we consider our strategic position
in each country in which we operate to
maximize shareholder value.
In accordance with our Group's strategy, in
November our Board of Directors endorsed
the restructuring of our organization through
promoting and entrusting Khaled Bichara to
be the Group's Chief Executive Officer, to help
us transform OTH into a more innovative, agile
and integrated global company and gear the
Group into a more aggressive period of growth.
I believe that in the coming years the telecom
market is going to witness massive
consolidation, and with the help of our new
structure I will devote more time and effort in
this directionÓ.
ÒThe year 2009 has been undisputedly challenging
for OTH, leading to a slower growth in 2009
compared to 2008, in line with our forecasts.
In Algeria, despite the harsh competition, OTA
still remains the clear leader in terms of market
share. In Pakistan, Mobilink has observed
stable revenues in local currency and increased
its subscriber base for the year end of 2009 by
8% compared to 2008. In Egypt, Mobinil has
weathered the harsh economic and competitive
conditions, displaying a positive growth rate
relative to its major competitor in the market.
Tunisiana has embarked upon several
successful retention initiatives in preparation
for the entry of a third player into the Tunisian
market. During 2009 our operation in
Bangladesh displayed exponential growth on
all fronts; ending the year with an increase of
22% in revenues and 34% growth of its
subscriber base compared to the previous year.
Koryolink is performing strongly and rapidly
expanding its sales and network coverage
throughout the country. In Lebanon, we have
surpassed the 1 million subscriber mark required
by our management contract of Alfa. Finally,
on December 16th 2009, our Canadian
investment, WIND Mobile, was launched.
Throughout this year we have held to an
ambitious OPEX reduction plan, resulting in an
OPEX reduction of 6.3% vs. our internal budget
for 2009. Both Pakistan and Bangladesh
showed healthy results thanks to the
implementation of our cost optimization plan.
We continue to create value through catering
to our customers' needs by providing
innovative and high quality services.Ó
 03
OTH at a Glance
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OTH's vision OTH's mission

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To harness our networks to provide millions of We Exist toÉ

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connected customers with solutions that Enrich our customers' lives through accessible
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empower their personal and professional lives. communication services

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Ensure our shareholders' returns with the

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highest yields
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Expand our employeesÕ horizons with

exceptional growth opportunities
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Enable our communities' development and

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prosperity by always giving back

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'A VOICE THAT SOUNDS IS A VOICE THAT'S HEARD.'

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Positioned for success
Orascom Telecom Holding S.A.E. ("OTH") is a
leading telecommunications company with mobile
operators in many regions of the globe including
Canada, the Middle East, Africa and Asia. It was
established in 1998, by launching its first mobile
operation (ÒMobinilÓ), also the first mobile operator
in Egypt. OTHÕs headquarters subside in the heart
of Cairo where the company initially started. After
Mobinil's launch, OTH continued its journey by
pursuing markets characterized by large population
densities and low mobile penetration rates. However
this strategy changed in the last two years as it
started to enter more diverse markets with its latest
launch to date (ÒWIND MobileÓ) in Canada.
In 1998, OTH started off with 200,000 subscribers.
By the end of 2009, OTH is proud to be extending
its care and services to almost 93 million subscribers.
It is also serving a total population under license
of approximately 510 million with an average mobile
telephony penetration of approximately 49%.
A Borderless company
Having launched ÒMobinilÓ in 1998, OTH operations
to date include Algeria ("OTA"), Pakistan
("Mobilink"), Egypt ("Mobinil"), Tunisia ("Tunisiana"),
Bangladesh ("banglalink"), North Korea ("koryolink")
and Canada ("WIND Mobile") through an indirect
equity ownership in Globalive Wireless.
At the beginning of 2009, OTH was also awarded
the management contract of one of the two
Lebanese mobile telecommunications operators
("Alfa") from the government of the Republic of
Lebanon. Furthermore, OTH has an indirect equity
ownership in Telecel Zimbabwe (Zimbabwe) and
through its subsidiary Telecel Globe, operates in
Burundi, the Central African Republic, and Namibia.
Value to stakeholders
OTH's target is to provide value for its investors
and shareholders by expanding in high growth
markets and strengthening its position in its existing
operator companies through focusing on current
as well as potential subscribers. Profitability and
success are demonstrated through the fact that all
of OT's operator companies are either market
leaders or major players in their markets.
OTH employees take gratification in striving for the
success of a business that provides the tools by
which people can communicate and improve their
lives.
OTH's customers everywhere in the world are
provided with the best service as operator
companies constantly aim to cater and adapt to
their needs by offering innovative solutions to make
their lives better, easier and more rewarding.
The power to communicate
In a world with increasing interconnectivities and rapid
technological transformations and advancements,
not being able to communicate means not being able
to exist.
It is OTH's core belief that communication is the
essence of life, the inherent right of every human
being and the means by which communities advance.
Being a borderless company, OTH seeks to provide
communications to all peoples of the world.
Communication empowers people by letting them tell
their stories, enhance their lives and advance their
communities. Integrating the most suitable and best
technology innovations for each country enables OTH
operator companies to facilitate and enrich their
subscribers' lives.
When the world calls, we listen. When the world talks,
we feel for what it wants to say. We help give it a
voice.
 04
Financial Highlights
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Subscribers Revenues EBITDA Main Financial Data

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(according to IFRS)
in millions in US$ millions in US$ millions
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2008 2009
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Revenues (in US$ million) 5,327 5,065

93 5,327 2,384
2,172 EBITDA (in US$ million) 2,384 2,172
78 5,065
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EBITDA Margin 44.7% 42.9%

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Net Income (in US$ million) 431 318

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(1)
Earnings per GDR (US$)(1) 2.30 1.81
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CAPEX (in US$ million)(2) 1,576 1,037

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Net Debt (in US$ million) 5,084 5,113

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2008 2009 2008 2009 2008 2009

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(1) Based on a weighted average for the outstanding number of shares of 175,567,008 GDRs
(2) CAPEX components classification (e.g. tangible vs. Intangible) may differ from an operational
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perspective vs. an accounting one. The above figures have been prepared to reflect CAPEX from
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an operational perspective, and may differ from CAPEX figures released in the financial statements.

Shareholder Information by the amount equal to 10,302,769 shares. After

Orascom Telecom Holding S.A.E. ("OTH")
maintains a high level of disclosure and keeps its
shareholders informed of any significant events
through press releases, quarterly earnings releases,
conference calls and an updated website with all
relevant operational and financial information in
addition to reporting its financials under Egyptian
Accounting Standards (LE) and under International
Financial Reporting Standards (US$).
Ownership Structure
Weather Investments S.p.A. directly and indirectly
owns approximately 51.6% of the shares of OTH, and
48.4% is public free float as of December 31st 2009.
Buyback Shares & Cancellation of Shares
In February 2009, the Company announced that it
filed an application with the Egyptian Capital Market
Authority and the Egyptian Stock Exchange for the
selective repurchase of its shares in light of favorable
relative market valuations. Orascom Telecom planned
a potential on-market GDR and local shares
repurchase plan of up to 65 million shares (13 million
GDRs) over the coming three months. In October,
the Company approved the reduction of its issued
capital by writing off the Company's treasury shares,
this reduction, the total number of fully paid up shares
was 889,100,105. In December, the Company
approved the amendment of the Authorized Capital
to be LE 7.5 billion instead of LE 2.5 billion. The
Board of Directors were authorized to increase the
Company's capital by way of rights issue by
respecting pre-emption rights afforded to existing
shareholders. The size of the rights issue was to be
maximum (LE 4,392,100,105) and subscription was
to be at par (LE 1). The capital increase was
conditional upon the prior consent of the Company's
lenders to the waivers and conditions according to
the Credit Agreement made with the Company in
the amount of US$ 2.5 billion, provided same was
to be indicated in the prospectus of the public
subscription notice to existing shareholders.
Share Ownership Program for Employees
As part of its commitment to motivate and retain its
key employees, OTH offers an ESOP plan, having
an ownership of approximately 1% of OTH shares.
Paid up Capital
As at December 31st, 2009, OTH's paid up capital
was LE 889,100,105, divided into 889,100,105
shares, each with a nominal value of LE 1.
Dividends
In August 2009, the Company received from the
Egyptian Exchange requests for dividend payment
in shares from a total number of 8,764,923 local
shares and from the London Stock Exchange a total
number of 71,463,505 GDRs (equivalent to
357,317,525 local shares). Based on the announced
distribution ratio of 36:1; the Company distributed
243,470 shares to its local shareholders and
1,985,097 shares to its GDR holders (equivalent to
9,925,487 local shares). Consequently, the Board
of Directors agreed to distribute in cash an amount
of EGP 180,111,604 for a total number of local
shares of 180,111,604 (EGP 1/share) and an amount
of US$ 59,851,888 for a total number of 66,337,438
GDRs (equivalent to 331,687,192 local shares)
(around US$ 0.9022/GDR).
Dividend Policy
OTH's primary goal is to maintain sufficient reserves
and liquidity to ensure its operational and financial
needs and to maintain a strong growth profile of its
business. OTH intends to operate a progressive
distribution policy based on what are believed to be
sustainable levels of dividend payments
supplemented by variable distribution to shareholders
of any excess cash resources. Consequently,
dividends will vary from year to year.
Share Price Performance
At the beginning of 2009, the OTH stock was quoted
at LE 30.88 on EGX. The highest quotation during
the year was LE 40.25, and the lowest was LE 16.54.
At year end, the quotation price was LE 25.17; this
amounted to an 18.5% decrease in value. The market
value as of December 31st, 2009 was LE 21.5 billion.
OTH GDRs listed on the London Stock Exchange
at the beginning of 2009 were quoted at US$ 24.56.
The highest quotation during the year was US$
36.49, and the lowest was US$ 14.29. At year end,
the quotation price was US$ 24.81; this amounted
to a 1% increase in value. The market value as of
December 31st, 2009 was US$ 4.4 billion.
Trade
OTH is traded on both the Egyptian Stock Exchange
and on the London Stock Exchange under the
symbols (ORTE.CA, ORAT EY) and (ORTEq.L,
OTLD LI), respectively.
Disclosure
To ensure full disclosure and transparency, OTH
reports its Holding and Consolidated financials on
a quarterly basis applying both the Egyptian
Accounting Standards (ÓEASÓ) and US$ consolidated
financial statements in accordance with the
International Financial Reporting Standards (ÓIFRSÓ).
OTH ANNUAL REPORT 2009 05

Organizational Structure

Naguib Sawiris
Executive Chairman

Manal Abdel Hamid Mohamed Naguib

PR & Corporate Internal Audit Officer
Communications Director

Khaled Bichara
Group CEO

Emad Farid Philip Tohme Aldo Mareuse Ashraf Halim Ragy Soliman Wafaa Lotaief
Group Chief Strategy Chief Technology Group Chief Chief Commercial General Counsel Group HR & Admin
Officer Officer Financial Officer Officer Officer

Business Planning,
Corporate Strategy,
Innovation and Partnerships
Network & IT Solution Corporate Finance, Market Development, Sales, Compliance & Secretarial Compensation & Benefits,
Engineering, Procurement, Treasury, Tax Planning & Customer Operations, Corporate Affairs, Corporate Training & Development,
Operations Support, Corporate Accounting, Corporate Marketing, Fixed Attorney Recruitment and
Regional Technical Planning Budgeting, Planning & and Broadband, Market Administration
& Control, HQ IT Support Control, Investors Relations Planning, Products and
Services
 06
Financial Milestones
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January March May July August November December

2009 2009 2009 2009 2009 2009 2009

OTH announces
launch of mobile
OTH announces financial services in OTH announces
success of PMCL Pakistan results of
Tender Offer for own Cash/Shares Mix
bonds from its Dividend
Distribution
Globalive Wireless, OTH realigns
OTH's Canadian organization to more Proposed Rights Issue to
Investment, is granted effectively focus on raise US$ 800 Million to
OTH is awarded a
License and receives growth and strategic strengthen the Balance
Management
Spectrum from transformational Sheet.
Contract in Lebanon.
Industry Canada initiatives OTH celebrates the
Telecel acquires
Cell One in Namibia inauguration of WIND
Mobile in Canada
OTH ANNUAL REPORT 2009
Financial Events 2009
Telecel Globe acquires Cell One in Namibia
In January 2009, Orascom Telecom announced
that it has acquired the mobile telecommunications
operator Cell One in Namibia. Cell One operates a
GSM 900/1800 network and has 198,000 active
subscribers and over 20% market share. The total
consideration of this transaction is approximately
US$59 million in cash, of which US$32 million is
already paid and the balance due in January 2010.
The debt assumed as part of this transaction is non-
recourse on Telecel Globe.
Orascom Telecom is awarded a Management
Contract in Lebanon
In January 2009, OTH announced that it has been
awarded the management contract of one of the
two Lebanese mobile telecommunications operators,
Alfa, which is owned by the Republic of Lebanon.
The management contract extends for one year
and is renewable for another year. Under this
contract, OTH is required to increase the number
of subscribers of Alfa from around 600 thousand at
the end of 2008 to around 1 million at the end of
2009. The management fee is paid by the Republic
of Lebanon and will be defined based on the
performance of the operator as measured by
operating expenditure per active subscriber. The
Republic of Lebanon is fully responsible for the
Capex during the contract period.
Globalive Wireless, OTH's Canadian Investment,
is Granted License and Receives Spectrum from
Industry Canada
In March 2009, Orascom Telecom announced that
Globalive Wireless Management Corp. (ÒGlobalive
WirelessÓ), in which OTH has a 65 per cent indirect
equity ownership, had officially been granted its
spectrum license from Industry Canada and had
received the corresponding spectrum. Globalive
Wireless expects to launch its network to consumers
in the fourth quarter of 2009, providing affordable,
customer-centric and innovative wireless services
across Canada in a market that is still not fully
penetrated, with relatively high ARPU and a
reasonably competitive environment.
Launch of mobile financial services in Pakistan
In July 2009, Orascom Telecom announced the
launch of mobile financial services by its Pakistani
subsidiary, Mobilink. Mobilink, Pakistan's market
leader in cellular services will be providing these
services in association with Citibank under an
arrangement endorsed by the State Bank of
Pakistan. Mobilink and Citibank will utilize Mobilink's
extensive retail infrastructure to extend the reach
of financial services to the previously un-served
masses.
Using Mobilink's cutting edge technology, Mobilink
users will be able to open branchless bank accounts
through a simple and convenient registration process
via authorized agents across the country. The service
will allow users to maintain their accounts through
their phones and make secure peer to peer money
transfers to any Mobilink number simply via SMS.
Mobilink envisions extending this partnership with
Citibank further by using this platform to empower
subscribers to avail and repay loans, purchase
goods and services, pay bills, buy airtime and a
host of other services using their cell phones. Mobilink
is the only mobile operator in Pakistan to have made
headway in the m-commerce arena by offering m-
commerce services.
Orascom Telecom Algeria received the Official
Tax Assessment for the years 2005, 2006 and
2007
In November 2009, Orascom Telecom Holding
(ÒOTHÓ) announced that its Algerian subsidiary
Orascom Telecom Algeria (ÒOTAÓ) received the
official tax notification from the Algerian Direction
des Grandes Enterprises (Tax Department for Large-
Scale Companies) (the ÒDGEÓ) in respect of the
years 2005, 2006 and 2007, in which the DGE has
assessed taxes and penalties alleged to be owing
by OTA in the amount of DZD 43.9 billion
(approximately USD 596.6 million) (the
ÒReassessmentÓ). The Reassessment is based
primarily on the unfounded and unacceptable
allegation that OTA did not keep proper accounts
for the years 2005, 2006 and 2007 notwithstanding
that OTA's accounts were fully audited and approved
by both OTA's international auditors, and its local
statutory auditors. OTH and OTA confirm that the
Reassessment is unfounded. OTH and OTA dispute
the concept and the content of the claim based on
the fact that the DGE seeks to impose taxes on
OTA from which it was exempt during the period
under consideration, among other things. OTH and
OTA intend to take all necessary legal steps to
challenge the Reassessment through all available
administrative and judicial channels to defend its
reputation, integrity and rights. Without prejudice
to its rights under the Investment Agreement and
applicable laws, OTA will appeal the Reassessment
within the DGE appeal procedure. This tax claim
may reduce the amount to be distributed as dividends
in 2010 from OTA's 2009 net results. OTH is
confident in its ability and experience to mitigate
this risk of a possible reduced liquidity position in
an efficient manner to meet all its obligations as it
did in the past.
Proposed Rights Issue to Raise US$ 800 Million
to Strengthen the Balance Sheet
In December 2009, Orascom Telecom Holding
S.A.E. (ÒOTHÓ or the ÒCompanyÓ) announced that
the Board of Directors was convened on December
10th, 2009 and had decided to call for an
extraordinary shareholders' meeting (the ÒEGMÓ) to
increase the Company's authorized capital and to
authorize a capital increase through a rights issue
(the ÒRights IssueÓ). The proposed Rights Issue is
intended to further strengthen the balance sheet
and ensure OTH's liquidity including financing needs
for the Group in the case where there is no immediate
resolution of the tax dispute in Algeria. The size of
the Rights Issue proposed to the EGM was up to
EGP 5 billion, which allowed the Company to issue
a Rights Offering of US$ 800 million or EGP 4,392
million at the existing EGP/US$ rate at the time.
The Rights Issue offered existing shareholders new
shares for every existing share in the Company at
a price of EGP 1 per share (equal to the nominal
value of an ordinary share in the Company). Weather
Investments, OTH's largest shareholder, which owns
approximately 50.6% of the outstanding shares,
had communicated to the Company its commitment
to subscribe for a minimum of its existing pro rata
07
share in the Rights Issue. The proposed Rights
Issue was approved by shareholders at the EGM
held on December 27th, 2009.
Orascom Telecom Celebrates The Inauguration
Of WIND Mobile In Canada
In December 2009, Orascom Telecom Holding
(ÒOTHÓ) celebrated the inauguration of WIND Mobile,
the latest addition to the successful list of OTH
investments. WIND Mobile stores opened in the
Greater Toronto Area and Calgary before Christmas.
The company will be rolling out in Vancouver, Ottawa
and Edmonton in the year 2010. WIND Mobile is
the first new national wireless provider in Canada
in over a decade. WIND Mobile will provide voice,
text and data services to Canadians on a next-
generation wireless network and, where it has not
rolled-out its network, will provide national coverage
through a roaming agreement. WIND Mobile is
committed to offering a level of wireless service
presently not available in Canada.
Orascom Algeria (ÒOTAÓ) Appeals the Algerian
Notice of Tax Reassessment for 2005-2007 and
Pays 20% of The Reassessment to be Permitted
to Make such Appeal
In December 2009, Orascom Telecom Holding
(ÒOTHÓ) announced that its Algerian subsidiary
Orascom Telecom AlgŽrie (ÒOTAÓ) filed an
administrative appeal (rŽclamation contentieuse)
against the notice of reassessment dated November
16th, 2009 received from the Algerian Direction des
Grandes Entreprises (Tax Department for Large-
Scale Companies or "DGE") in respect of the tax
years 2005, 2006 and 2007 (the ÒReassessmentÓ).
Pending appeal, OTA is not required to pay the full
amount of the Reassessment. In order to file its
appeal, however, Algerian law requires OTA to pay
20% of the taxes and penalties alleged to be owed,
i.e. DZD 8.78 billion (approximately USD120 million).
OTA paid this amount to the DGE on December
24th, 2009 under protest and in reservation of all
rights. The amount paid will be recoverable if OTA's
appeal is successful.
 08
Board of Directors
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Standing from left to right

Mohamed Shaker Hassan Abdou Emad Farid Khaled Ismail Franois Dopffer Ajit Nedungadi
Non-Executive Board Member Non-Executive Board Member Executive Board Member Non-Executive Board Member Non-Executive Board Member Non-Executive Board Member

Seated from left to right

Ahmed Maher El Sayed Khaled Bichara Naguib Sawiris Iskander N. Shalaby

Non-Executive Board Member Group Chief Executive Officer Executive Chairman Non-Executive Board Member

The above reflects the latest composition of the Board of Directors

OTH ANNUAL REPORT 2009
Board of Directors
Naguib Sawiris
Executive Chairman
Since joining Orascom in 1979,
Mr. Naguib Sawiris has
continuously contributed to the
growth and diversification of the
company into what it is today -
one of Egypt's largest and most diversified
conglomerates. The Orascom Group is the country's
largest private sector employer and has the largest
market capitalization on the Cairo & Alexandria
Stock Exchange. Mr. Sawiris established and built
the Railway, Information Technology, and
telecommunications sectors of Orascom. The
extraordinary success of these ventures as well
as the other sectors of the company led to the
management decision to split Orascom into
separate operating companies: Orascom Telecom
Holding (OTH), Orascom Construction Industries
(OCI) , Orascom Hotels & Development (OHD)
and Orascom Technology Systems (OTS) . Since
that time in late 1997, Orascom Telecom Holding
S.A.E.(OTH) was established, chaired and
managed by Mr. Sawiris.
As Executive Chairman of Orascom Telecom
Holding (OTH), Mr. Sawiris has dynamically led
the growth of the company, to be the leading
regional telecom player and among the best
regarded emerging markets players in the world.
After the foundation of Weather Investments in
early 2005, Mr. Sawiris led the landmark leveraged
buyout of a majority of Wind Telecommunications
in Italy and took over management as its Chairman
in late summer 2005. Followed by that, Weather
Investments acquired Tim Hellas in Greece and
re-branded it under the name ÒWind HellasÓ. In
November 2006, Wind Telecommunications floated
the largest ever PIK debt in Europe with proceeds
used to complete the buyout of Wind Italy from
ENEL resulting in the Sawiris Family owning 98%
of Weather Investments.
At international and regional levels, Mr. Sawiris
serves on the following boards, committees and
councils:
¥ Member of the International Advisory Committee
to the NYSE Board of Directors (IAC) since
November 2005.
¥ Board Member of the International Advisory
Board to the National Bank of Kuwait.
¥ President of the German-Arab Chamber of
Industry and Commerce for 2008, 2009 and
2010.
¥ Board Member of the Supreme Council of
Sciences and Technology formed by a
presidential decree issued by Egyptian President
Hosni Mubarak. The council's board includes a
galaxy of scientists including Nobel laureate Dr.
Ahmed Zewail, Dr. Farouq el-Baz and Dr. Magdy
Yaqoub.
¥ Board Member on both the Board of Trustees
and the Board of Directors of the Arab Thought
Foundation.
¥ Board of Trustees member of the French
University in Cairo.
¥ Board member of the Egyptian Council for Foreign
Affairs.
¥ Board Member of the Consumer Rights Protection
Association of Egypt.
Mr. Sawiris is also the recipient of numerous
honorary degrees, industry awards and civic honors,
including the Ò Legion d'honneur Ò (the highest
award given by the French Republic for outstanding
services rendered to France) and the recipient of
prestigious ÒSitara-e-Quaid-e-AzamÓ award
(conferred upon Mr. Sawiris in 2006 by General
Pervez Musharref for services rendered to the
people of Pakistan in the field of telecommunication,
investments and social sector work).
Mr. Sawiris holds a diploma of Mechanical
Engineering with a Masters in Technical
Administration from the Swiss Institute of
Technology, ETH, Switzerland.
09
Khaled Bichara
Group Chief Executive Officer
Mr. Khaled Bichara is currently
the Group Chief Executive Officer
of Orascom Telecom Holding
S.A.E as well as the Chief
Executive Officer of Weather
Investments S.P.A. He sits on the board of
Orascom Telecom Holding (OTH) since 2003, the
largest GSM operator in the Middle East, Africa
and Pakistan. He is also a board member of WIND
Italy, and various telecom and IT companies.
Mr. Bichara was appointed Chief Operating Officer
of OTH in April 2009. He was previously COO of
Wind Telecommunications. He brings a wealth of
experience in both telecommunication and
information technology with a strong management
and entrepreneurial experience.
Mr. Bichara headed the fixed line and portal
business unit at Wind Telecomunicazioni S.p.A
from 2005 until he was promoted to Chief Operating
Officer of the company. At Wind, he played a key
and instrumental role in restructuring the company's
organization, which led to the successful turnaround
of Wind from a continuously loss making company
to one of the best performing mobile, fixed line and
broadband integrated operators in Europe within
a record time span of three years. Prior to joining
Wind, he was the cofounder, Chairman and CEO
of LINKdotNET (ÓLDNÓ), the largest private Internet
Service Provider (ÓISPÓ) in the Middle East. In
2001, following successful negotiations, Microsoft
chose to partner with LDN headed by Mr. Bichara
to launch MSN Arabia, the Middle East's first global
portal, bringing full internet experience of MSN to
users in the region.
OTH ANNUAL REPORT 2009
Board of Directors
In December 2003, Business Today Egypt chose
Mr. Bichara as the ÒYoung Executive of the YearÓ
for executives under the age of 40.
Mr. Bichara earned his Bachelor of Science degree
from the American University in Cairo where he is a
member of the Advisory Board for the Computer
Science and Engineering Department. He is an active
member of the Software Community in the Middle
East, a founding member of the Egyptian Software
Association and the Internet Society of Egypt.
Ahmed Maher El Sayed
Non-Executive Board Member
Born September 14th, 1935,
graduated from the Faculty of
Law, Cairo University in 1956.
He joined the Foreign Ministry
in 1957 and served in Zurich,
Kinshasa and Paris. Moreover, he served in the
departments of Arab Affairs, Consular Affairs and
European Department. He served in the Office of
the President's National Security Advisor from
1972-1974, as Chief of Cabinet of Minister of
Foreign Affairs from 1974-1980, as a member of
the Egyptian delegation at the Camp David
negotiations in 1978 and as a member of the Taba
arbitration team.
Mr. El Sayed held the following positions:
Ambassador to Portugal (1980-1982), Ambassador
to Belgium and to the European Community (1983-
1984), Head of Policy Planning Department (1984-
1986), Head of Legal Department (1987-1988),
participated in negotiations about Taba and
arbitration procedures, Ambassador to the USSR
and then Russia (1988-1992), Ambassador to the
USA (1992-1999), Head of the Arab League Fund
for Africa (2000-2001), and Minister of Foreign
Affairs (2001-2004). He is a member of the Shura
Council (the Upper House of Egyptian Parliament),
and also publishes articles in various newspapers.
Ajit Nedungadi
Non-Executive Board Member
Mr. Ajit Nedungadi heads TA's
International Group and focuses
on investments in growth
companies in Europe and India.
He serves on the Boards of Alma
Lasers, eDreams, ION Trading, Micromax
Informatics, Sophos Plc and Weather Investments
S.p.A. He is also very involved with TA's
investments in Idea Cellular, Jupiter Investment
Management Group and M and M Direct, and was
on the Boards of Drive Assist and SmartStream
Technologies. Prior to joining TA in 1999 in the
Boston office, Mr. Nedungadi was at Trilogy
Software. Prior to that, he was at Investcorp
International, specializing in leveraged buyout
transactions. Mr. Nedungadi was also previously
with Credit Suisse First Boston in the Mergers &
Acquisitions department. He received a BS degree
in Electrical Engineering and Economics, magna
cum laude, Phi Beta Kappa, from Yale University
(1992) and an MBA degree as a Baker Scholar
from the Harvard Business School (1998).
Emad Farid
Executive Board Member
Emad Farid is the Vice Chairman
of Orascom Telecom Holding
S.A.E. in charge of Corporate
Strategy and Business
Development, a position he has
been promoted to effective April
st
1 , 2009. Before his promotion, he was holding
the position of Group Chief Operating Officer of
OTH since 2003. He is a member and/or Chairman
of the Board in many of OTH's subsidiaries including
OTA (Algeria), Mobilink (Pakistan), OTT (Tunisia),
koryolink (DPRK), ARPU+ and MENA Cable among
others. In addition, he is member of the Board of
Directors of Wind, a mobile and fixed
telecommunication operator in Italy. Mr. Farid joined
the Orascom group in 1992 where he held different
managerial positions. He joined OTH in 2000 and
was subsequently appointed as the CEO of Syriatel
(OTH's GSM subsidiary in Syria). Mr. Farid holds
a Master of Science degree in Telecom Engineering
from Cairo University.
Franois Dopffer
Non-Executive Board Member
Mr. Dopffer is a former French
Ambassador to Turkey (1991-
96) and to Egypt (2000-2002).
He has extensive knowledge of
United States, North Africa,
Middle East and Asian countries where he served
in different positions. He holds degrees in Political
Science (IEP Paris), Public Management (ENA)
and Law (Paris University). He has published in
2008 a book of political analysis, The Turkish
Imbroglio.
Hassan Abdou
Non-Executive Board Member
Mr. Abdou is currently Chief
Executive Officer of Weather
Investments II, which was formed
in 2005 as the majority owner of
Weather Investments, a global
telecom company owning and controlling Orascom
Telecom, Wind Telecommunications in Italy and
10
most recently TIM Hellas in Greece. Mr. Abdou is
an active board member in Weather, Wind and OT
and in addition, sits on the board and executive
committees of several IT, telecom and media
companies in Europe, Egypt and the Middle East.
Prior to his involvement with the Orascom Group
which started in 2003, he was Chief Investment
Officer of EFG-Hermes Private Equity and the
Horus Private Equity Fund where he was Fund
Manager since 1997. In 1995 and until returning
to Egypt, he was a consultant in the New York
office of the Boston Consulting Group where he
worked with Fortune 500 companies in such areas
as Telecommunications, Media & Entertainment,
Energy and Pharmaceuticals. Mr. Abdou had begun
his career with Exxon Company where he worked
for several years as a Project Controls Engineer.
In addition to his activities in the region, Mr. Abdou
is a member of the Advisory Board of the New York
Private Placement Exchange (ÓNYPPEÓ).
Mr. Abdou received his Bachelor of Science in
Mechanical Engineering from the University of
Pennsylvania and a Bachelor of Science in
Economics from the Wharton Business School. In
addition, he received his MBA from the Harvard
Business School.
Iskander N. Shalaby
Non-Executive Board Member
On September 1st, 2008 Alex
Shalaby was appointed Chairman
of the Egyptian Company for
Mobile Services (Mobinil) by
board consensus, following his
appointment as its President and CEO in 2005.
This step came because of Shalaby's remarkable
achievements at Mobinil over the preceding three
OTH ANNUAL REPORT 2009
Board of Directors
years where the company has witnessed continued
market share leadership, tripled the subscriber
base from six to 19 million, doubled the revenues,
and increased net profits by 30%.
Mr. Shalaby was Chief Officer for Regulatory Affairs
at Mobinil from 1998 to 2005 and was responsible
for helping with the licensing and regulations
required in setting up Mobinil as the first mobile
operator in Egypt. Mobinil is partly owned by OTH
and France Telecom/Orange, a balancing challenge
for Mr. Shalaby to maintain the trust and confidence
of the two major shareholders as well as the
company's thousands of public shareholders.
As former Executive Vice President of (OTH) and
continuing to be one of its Board Members, Mr.
Shalaby's regional experience proved invaluable
as OTH expands its global footprint.
Mr. Shalaby came to Mobinil from Washington, DC
where he was AT&T Director for Public Affairs,
serving as the company's link to lawmakers on
Capitol Hill and lobbying the executive branch of
the U.S. government. He helped in achieving more
liberalization of the telecoms sector internationally
for the emerging nations of the Middle East, Africa,
Eastern Europe through the relevant multi-lateral
agencies. It was during these years that he served
on the Boards of the American Chamber of
Commerce becoming its president during the period
(1991 - 1992) and the Bi-national Fulbright
Commission and Seeds of Peace; he currently
Chairs the Board of Injaz & SIFE in Egypt. As his
AT&T responsibilities shifted from local to regional,
with particular focus on North Africa and the Levant,
between 1993 and 1995, Mr. Shalaby became
Regional Director for International Public Affairs for
AT&T, based in Cairo, Egypt, where he was the
principal interface with key agencies within the
governments in the region on matters impacting
AT&T's operations.
Mr. Shalaby started with the early days of data
communications at AT&T, moving between posts
in California and New Jersey, where he worked
with Bell Labs. Mr. Shalaby then moved to become
Managing Director for AT&T in Egypt, and General
Manager for the Middle East and North Africa
region until 1993. He held a variety of technical
and managerial positions with AT&T start-ups in
the Gulf (1977-1980). In 1977, he moved to Saudi
Arabia to help launch the first major AT&T
microwave project before moving on to Kuwait and
the UAE. Once again, during this period, he
established and secured a solid position for AT&T
in the Gulf region.
In 1966, Mr. Shalaby graduated with a Bachelors
of Science degree in Electrical Engineering from
the University of Alexandria and started his first
job with Egypt Air as a radio and radar engineer
for two years. In 1969, he immigrated to the United
States, where he settled in San Jose, California
and started his first job with Pacific Telephone and
Telegraph Company, a subsidiary of AT&T at the
time. During this time, he earned a Masters of
Science degree in Electrical Engineering and
Computer Science from San Jose State University.
Khaled Ismail
Non-Executive Board Member
In February 2010, Dr. Khaled
IsmailÊwas the GSM Services
Officer at Orascom Telecom
Holding, in charge of mobile
services and strategic directions
for convergence including Wimax.
Prior to that, Dr. Ismail was the senior advisor of
the Egyptian Minister of CIT, responsible for
technology development.
Dr. Ismail is the CEO of SySDSoft, a company
focused on the design of wireless digital
communication systems. Prior to that, he was with
the IBM Research Center in NY. He is the recipient
of the IBM Invention Achievement Award and the
IBM Outstanding Technical Achievement Award
in 1997 and 1995, respectively. He is also the
recipient of the IEEE Honorary Society (Eta Kapa
Nu), Best Young Electrical Engineer in the US
award in 1994, and the Shuman Award for the
Young Arab Engineer in 1995.
Dr. Ismail received his Ph.D. from the
Massachusetts Institute of Technology in 1989.
He is an IEEE Fellow since 1997. He has published
over 160 papers in international journals and holds
22 US patents.
Mohamed I . Shaker
Non-Executive Board Member
Born October 16,1933 . A
graduate of the Faculty of Law,
Cairo University in 1955 .
Obtained a Doctorate degree in
Political Science from the
Graduate Institute of International
Studies, University of Geneva, in 1975.
He joined the Foreign Ministry in 1956 . As
ambassador he served at the United Nations at
New York (1984 - 1986), Vienna (1986 - 1988)
and London (1988 - 1997). During his tenure in
Vienna, he was a member of the Board of
Governors of the International Atomic Energy
Agency (IAEA). Two years before, he was a
representative of the Director General of the IAEA
11
to the United Nations (1982 - 1983).
At the present, he is Chairman of the Board of a
number of think tanks and academic institutions
including the Egyptian Council for Foreign Affairs
(a leading non governmental Think Tank), National
Center for Middle East Studies, and Regional
Information Technology Institute. He is also a
member of the Board of the Nuclear Power Plants
Authority.
He is Chairman of the Board of Trustees of a
number of major philanthropic organizations
namely; Sawiris Foundation for Social
Development and Magdy Yacoub Foundation for
Heart Research.
He also chaired two major international
conferences; Review Conference of Nuclear
Nonproliferation Treaty 1985 and Conference on
the peaceful uses of the nuclear energy in 1987.
He was a member of the U.N. Secretary-General's
Advisory Board on Disarmament Matters. He was
a member of the UN Expert Group on Disarmament
and Non-Proliferation Education (2001 - 2002).
Two of Dr. Shaker's major works are The Nuclear
Non-Proliferation Treaty: Origin and Implementation
1959 - 1979 (3 volumes), New York: Oceana
Publications, Dobbs Ferry, 1980, which was
reproduced in an electronic copy issued by both
the Egyptian Council for Foreign Affairs (ECFA)
and James Martin Center for Nonproliferation
Studies, California in May 2010, and The Evolving
International Regime of Nuclear Non-Proliferation,
Leiden/Boston: Martinus Nijhoff Publishers, 2007,
The Hague Academy of International Law, Recueil
des Cours, Vol. 321, 2006.
OTH ANNUAL REPORT 2009
Corporate Governance Report
Orascom Telecom Holding is committed to achieving
and maintaining the highest standards of corporate
governance. The Company considers effective
corporate governance essential to enhancing
shareholders' value and protecting stakeholders'
interests. Accordingly, the Board attributes a high
priority to identifying and implementing appropriate
corporate governance practices to ensure
transparency, accountability and effective internal
controls. In 2009, the Board continued to further its
commitment to corporate governance through
reviewing existing processes and, where appropriate,
developing new ones. The Company substantially
complies with the practices enunciated in the Egypt
Code of Corporate Governance and will strive to
comply with these and other appropriate standards
and governance guidelines. The key corporate
governance principles and practices are as follows:
The General Assembly
The General Assembly (ÓGAÓ) of the Company is
the ultimate governing body of the Company. In
summary, the (ÓGAÓ):
¥ includes all the shareholders of the Company;
¥ takes its decision by voting among shares
represented in the meeting. The voting rule is: 1
share = 1 vote for all shares indifferently;
¥ holds at least one ordinary meeting per year and
may have an extra-ordinary meeting as needed;
¥ The responsibilities of the GA are based on the
laws and Company Statutes;
¥ it appoints the board, approves the financial
results, appoints the external auditors, and
approves dividends distribution.
Board of Directors
The Board has the responsibility to work to enhance
the value of the Company in the interest of the
Company and its shareholders. In summary, the
Board:
¥ is engaged in active and continuous strategic
planning and approves corporate strategies,
including the approval of transactions relating to
acquisitions and divestments, and capital
expenditure above delegated authority limits;
¥ reviews and approves the corporate plan for the
forthcoming year and following two years, including
the capital expenditure and operating budget,
and reviews performance against strategic
objectives;
¥ assesses business opportunities and risks on an
ongoing basis and oversees the Company's
control and accountability systems;
¥ monitors and approves the Company's financial
reporting and dividend policies;
¥ appoints and has the authority to remove the
Chief Executive Officer and approves the
recommendations of the Human Resources;
¥ ratifies the appointment and has the authority to
remove the Chief Financial Officer and Group
General Counsel and appoints the Company
Corporate Secretary; and
¥ oversees succession planning for the Chief
Executive Officer and senior management.
The Chairman and the Chief Executive Officer
establish meeting agendas to ensure adequate
coverage of key issues during the year. In addition
workshops and strategy meetings take place.
Executives and other senior people regularly
attend Board meetings and are also available to
be contacted by Directors between meetings.
Composition of the Board of Directors
Executive Chairman
Naguib Sawiris
Board Members
Naguib Sawiris (Executive-Board Member)
Khaled Galal Bishara (Executive Board Member)
Ahmed Maher El Sayed (Non-Executive Board Member)
Ajit Nedungadi (Non-Executive-Board Member)
Emad Farid (Executive-Board Member)
Franois Dopffer (Non-Executive Board Member)
Hassan Mostafa Abdou (Non-Executive Board Member)
Iskander Shalaby (Non-Executive-Board Member)
Khaled Ezz El-Din Ismail (Non-Executive-Board Member)
Mohamed Shaker (Non-Executive-Board Member)
In addition to three Alternate Board Members;
Hythem El-Nazer
Michael Cole
Salim Nathoo
Secretary to the Board
Ragy Soliman
The above Board Members classification is based
on the Egyptian Corporate Governance code. The
latter did not specify the criteria for independent
directors that would allow the Company to
benchmark against, yet in our opinion and based
on internationally recognized best practices, a
number of our directors would qualify as
independent directors bringing to the company the
highest possible standing from both a personal
and professional standpoint.
Committees
¥ The Committee System of the Company is one
of the most important tools for the management
and the operational integration of the Company.
It has recently been revised to:
¥ monitor the implementation of strategies and the
development of plans and results;
¥ ensure the overall coordination of business actions
and the management of the relative cross-over
business issues;
¥ build up the necessary operating synergies
between the various functions involved in the
technological, business and support processes;
¥ support the integrated development of the
innovation processes of the Company;
¥ in particular, the new Committee System of the
Company includes:
Executive Committee
The objective of the Executive Committee is to
review and, where appropriate, authorize corporate
action with respect to most matters concerning the
Company's interests, strategy and management
of its business and subsidiaries during intervals
between meetings of the Board of Directors, and
generally perform such duties as may be directed
by the Board of Directors from time to time.
Investment Committee
The objective of the Investment Committee is to
assist the Board in reviewing the Company's
investment policies, strategies, transactions and
12
performance, and in overseeing the Company's
capital and financial resources. The Committee
has resources and authority appropriate to
discharge its responsibilities, including the authority
to retain experts or consultants.
Audit Committee
The objective of the Audit Committee is to assist
the Board in fulfilling its oversight responsibilities
by reviewing (i) proposed financial plans; (ii) the
financial information provided to shareholders and
others; (iii) systems of internal controls which
management and the Board of Directors have
established; and (iv) the audit process, including
both internal and external audits. The Audit
Committee interacts directly with the independent
auditor to ensure the independent auditor's ultimate
accountability to the Board and the Committee, as
representatives of the shareholders, and is directly
responsible for the appointment, compensation
and oversight of the independent auditor.
Remuneration Committee
The objective of the Remuneration Committee is
to ensure that the company has a formal process
of considering management and directors'
remuneration, that is executive directors should
play no part in decisions on their own remuneration,
there should be an alignment of the remuneration
schemes and the performance objectives of the
Company, and the remuneration schemes should
attract and retain talented individuals.
Operational Committee
The objectives of the Operational Committee is
the day-to-day operations on the Operational and
Holding level. This committee also serves as a
bridge between the management and the Executive
Committee to make sure that all are working
together for the benefit of the Company.
OTH ANNUAL REPORT 2009
Corporate Responsibility Report
At Orascom Telecom, we believe that corporate
social responsibility is a core business activity that
is constantly being reviewed to make sure it is in
alignment with our business strategy. In 2008, we
established a CSR unit at Orascom Telecom
Holding responsible for the promotion and
organization of CSR group wide activities. The
CSR unit is mainly involved in responding to cross
disciplinary CSR issues including stakeholder
engagement, environmental responsibility, social
investment and employee volunteering in addition
to using our core business to empower the bottom
of the pyramid segment. For more information on
Orascom Telecom corporate social responsibility,
please go to www.otelecom/responsbility
Social Investment
At Orascom Telecom Holding , we believe that the
support and trust of the local communities is
indispensible to the success of our long-term
business activities. Therefore, Orascom Telecom
Holding and its local operating companies strive
to build and sustain a trustworthy relationship with
the host communities where we operate. Through
our social investment programs in more than 12
countries, we aim to improve the socio-economic
conditions and bring about change in
underprivileged communities; our social investment
programs are locally tailored to create opportunities
and improve the standard of living in areas where
we do business. Brief descriptions of some of the
group's social investment projects undertaken in
different countries in 2009 are listed below.
Egypt - Orascom Telecom Holding
Education Fund with the French University in Egypt
In recognition of the importance of liberal arts
education, Orascom Telecom Holding established
in partnership with the French University in Egypt
2009 an Educational Fund. The fund supports
students who demonstrate educational excellence
and are in need of financial assistance to join the
undergraduate program in Literature & Linguistics,
Engineering or Business Administration. The
program will continue until 2012 and it offers both
full and partial scholarships to the selected students.
The selection criteria include non-academic
qualifications such as demonstration of extracurricular
activities, volunteering and leadership skills.
Egypt - Orascom Telecom Holding
Capacity Building for the Blind
In April 2009, the Sawiris Foundation for Social
Development (SFSD) and Orascom Telecom
Holding in collaboration with IPPSN have accepted
to fund The Development Association for
Empowering Persons with Special Needs (DAESN)
to implement the project titled ÒCapacity Building
and Developing Skills Project for the BlindÓ.
The project objectives included providing 160
beneficiaries with computer and soft skills training
to qualify them to enter the job market. Orascom
Telecom Holding and IPPSN provided the
beneficiaries with accessible free software that
he/she can use to assist accessibility of ICT to
blind users in the society. The free software helps
the blind and visually impaired people to operate
computers and utilize their potentials for their use
and the society using adaptive technology. The
project also aims at availing employment
opportunities to the beneficiaries after completing
the training.
Egypt - Mobinil
SMS Campaign in Ramadan
During the holy month of Ramadan 2009, Mobinil
led a nationwide initiative to contribute to the
development of the Egyptian community, through
giving more than 23 million Mobinil customers the
opportunity to give back to the community. Through
Mobinil's initiative of donating an amount from
every transaction made, Mobinil was able to reap
LE 24 million during the Holy month, to be
distributed to a network of micro-finance charities.
The amounts distributed were as follows:
¥ Dar El Orman Organization received LE 9 million;
it is estimated that 1300 families benefit from this
donation.
¥ Al Tadamun Microfinance Foundation received
LE 7 million; the donated amount targets
thousands of poor women, through the funding
of their micro enterprises.
¥ Egyptian Junior Business Association - EJBA
received LE 5 million; young entrepreneurs are
to receive financial means to carry out their dream
projects.
¥ The Egyptian (Ana El Masry) received LE 3
million; up to 2500 families are estimated to
benefit from facilitated loans to help them sustain
stable income generating micro and small
enterprises
Pakistan - Mobilink
SMS - based Literacy for Learning
Launched in 2009 with a view to reshaping lives
through connectivity, the SMS-based literacy
program is a joint venture between Mobilink,
UNESCO with a local NGO, Bunyad as the
implementing partner. In the pilot, the 250 learners
received interesting and informative text messages
daily in Urdu and were expected to respond. In the
second part, the participants were evaluated on a
periodical basis to assess gains in knowledge and
learning. The program was conducted with the
help of 10 teachers enlisted by Bunyad.
It was found that at the beginning of the program
57% of the girls were graded 'C' and only 28% of
the girls managed to score an 'A'. However, near
the end of the project the situation reversed where
the percentage of girls receiving a 'C' dropped to
only 11% whereas more than 60% of the girls were
awarded an 'A'. The program teachers also report
a stark improvement in the confidence of the young
girls as owning a mobile phone made a difference
to their sense of security.
The 5 month pilot project conducted with 250
adolescent girls in Punjab has shown a marked
improvement in their skills and has managed to
overcome the socio-cultural barriers traditionally
associated with owning a cell phone.
On March 25th, 2010, Mobilink announced the
expansion of the SMS-based literacy project to
include another 1,000 girls to understand the impact
of replicating the project on a larger scale.
Bangladesh- banglalink
banglalink jigyasha
The economy of Bangladesh is highly reliant on
its agricultural sector; in fact, 60% of the population
is comprised of farmers. In addition, the growth of
13
SMEs working in the agricultural sector is crucial
in the path of developing the economy of
Bangladesh. However, the existing and potential
SME owners are often faced with difficulties
regarding access to necessary information required
to prosper in business. In response, banglalink
introduced 'krishi jigyasha 7676' which is a hotline
that provides information and answers to any
queries related to agriculture, vegetable and fruit
farming, poultry, livestock feed, information on
seeds, fisheries including daily prices etc.
The Òbanglalink jigyashaÓ offers services to
individual farmers and fisheries. banglalink is a
pioneer in launching such a service in Bangladesh.
The Òbanglalink jigyashaÓ won the Best Mobile
Enterprise Application Product or Service Category
at the prestigious Asia Mobile Awards 2009.
Canada - WIND Mobile
Random Acts of Kindness
On November 18th 2009, WIND Mobile launched
its 'Random Acts of Kindness' (RAK) community
initiative after a delay to its launch. The stall, as a
result of a CRTC ruling, put WIND Mobile in a
position where 400 customer facing employees,
fully trained and ready to go, were left idle. To best
utilize these fully trained and enthusiastic
employees, WIND Mobile deployed street teams
into the Toronto and Calgary communities where
WIND Mobile was to have a business footprint.
400 WIND Mobile employees brainstormed in their
store and care teams, planning their RAK outreach
autonomously. Over the course of one week, teams
volunteered their time all over the Greater Toronto
Area and Calgary, assisting organizations such as
the Salvation Army, Ronald McDonald House, and
Habitat for Humanity. Furthermore, many teams
participated in ad-hoc public initiatives such as
pumping gas, helping people carry groceries and
sheltering public transit commuters from the
elements. On November 30th, WIND Mobile
participated in its biggest group RAK, with over
150 employees volunteering at the Daily Bread
Food Bank. This group was made up of both
corporate and customer facing employees, including
the company's Chief Customer Officer, its Chairman
along with many other senior executives.
OTH ANNUAL REPORT 2009 14

GSM Operations Orascom Telecom Holding serves a population of 510 million* with an average penetration of 49%

Tunisia
(Tunisiana)
Egypt
(Mobinil)

Canada
(WIND Mobile)

North Korea
(koryolink)

Algeria Pakistan
(OTA) (Mobilink)

Bangladesh
Central African (banglalink)
Republic
(Telecel Centrafrique)

Burundi
(LeoTM)

Zimbabwe
(Telecel Zimbabwe)

Namibia
(LeoTM)

Country Population Mobile Penetration Country Population Mobile Penetration

Algeria (OTA) 34 million 72% Canada (WIND Mobile) 33 million 65%
Pakistan (Mobilink) 176 million 55% Central African Republic
Egypt (Mobinil) 83 million 73% (Telecel Centrafrique) 4.5 million 15%
Tunisia (Tunisiana) 10 million 93% Namibia (LeoTM) 2.1 million 71%
Bangladesh (banglalink) 156 million 33% Burundi (LeoTM) 9.5 million 10%
North Korea (koryolink) 23 million 0% Zimbabwe (Telecel Zimbabwe) 11 million 26%

Population Figures from CIA Factbook (est. July 2009). Mobile Penetration is based on December 31, 2009 subscribers number & market share. *excluding Canada and Lebanon.
 15
OTA - ALGERIA
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Financial and Operational Overview:

Financial Data Operational Data
December September December Inc/(dec)
December December Inc/ 2008 2009 2009 Dec. 2009 vs.
2008 2009 (dec) Dec. 2008
Operational Data
Financial Data
Subscribers 14,108,859 14,726,081 14,618,166 3.6%
Revenues (US$ 000) 2,040,544 1,867,837 (8.5%)
Market Share 64.7% 62.9% 59.4% (5.3%)
Revenues (DZD bn) 135.0 135.6 0.4%
ARPU (US$) (3 months) 11.8 10.5 9.9 (15.8%)
EBITDA (US$ 000)* 1,290,062 1,067,241 (17.3%)
ARPU (DZD) (3 months) 799 766 721 (9.7%)
EBITDA (DZD bn)* 83.66 78.10 (6.6%)
Avg MOU (YTD) 164 242 248 51.2%
EBITDA Margin 63.2% 57.1% (6.1%)
Churn (3 months) 12.5% 7.4% 7.1% (5.4%)
Capex (US$ m) 167 261 56%
* EBITDA excludes management fees which were previously treated as a cost in each subsidiary and as a revenue for the Holding.
OTH ANNUAL REPORT 2009
OTA - ALGERIA
Orascom Telecom Algeria SPA (ÒOTAÓ)
operates a GSM network in Algeria and
provides a range of prepaid and postpaid
products encompassing voice, data and
multimedia, using the corporate brand
ÒOrascom Telecom AlgŽrieÓ and the dual
commercial brands of ÒDjezzyÓ and "Allo".
OTA was awarded the second GSM license
in Algeria in 2001 and launched its
operations in February 2002. OTA
commenced its operations under the brand
ÒDjezzyÓ and introduced a second prepaid
brand ÒAlloÓ in August 2004.
As of December 31st, 2009, OTA served
over 14.6 million subscribers with a market
share of 59.4% of total mobile subscribers
and its network covered 96% of the total
population of Algeria.
Despite having launched its GSM operation
approximately three years after the launch
by the incumbent, Algerian Mobile Network
(ÒAMNÓ conducting business under the
ÒMobilisÓ name), OTA was able to rapidly
grow into Algeria's leading and preferred
telecommunications operator by far.
While OTA has already invested
considerably in its network, it plans to make
further investments to increase its capacity,
and to maintain and improve the quality of
its network to meet market demand. Finally,
as demand is growing and local content is
beginning to develop, OTA has started to
rollout a range of value-added multimedia
services based on GPRS and EDGE
technologies, which are designed to
increase customer usage and boost loyalty.
OTA is IS0 9001 and ISO 14001 certified
highlighting its continuous commitment to
operational excellence and customer
satisfaction.
Algerian Telecommunications Market
Telecommunications services in Algeria
are provided principally by AlgŽrie TŽlŽcom,
the incumbent state-owned
telecommunications operator, which
provides fixed-line services, and by three
GSM mobile operators, OTA, AMN and
Wataniya Telecom Algeria. AlgŽrie
TŽlŽcom held a monopoly position with
respect to basic fixed-line services until
2005, when OTH announced the
acquisition, jointly with Telecom Egypt, of
a second fixed-line license in Algeria.
License
In July 2001, OTA was granted a license
to operate a nationwide GSM
telecommunications network, to provide a
range of telecommunications services in
Algeria, to operate its own backbone and
to share or lease network infrastructure
with or to its operators. The license is a
15-year dual band license expiring 2016
with automatic renewal for two subsequent
five-year terms as long as OTA complies
with the terms of the license. Renewal is
at no additional cost.
Network
As of December 31st, 2009, OTA's network
covered approximately 96% of Algeria's
population, spreading its coverage over
the 48 wilayas (provinces) in the country
and providing on-road coverage along
major highways. The New Generation
Network (ÒNGNÓ) equipment introduced at
the end of 2006 allowed OTA to further
reduce the capital expenditure and
operating expense per subscriber.
Services and Marketing
OTA provides both basic voice and value-
added services to its corporate and retail
subscribers. In addition to basic voice
services, OTA provides its subscribers with
a wide range of value-added services and
data services such as : Voicemail, CLIP,
CLIR, missed call alert, Voice SMS, chatting
services, Web SMS, Data services, MMS,
e-voucher, Credit Transfer, Ring Back
Tone, EDGE, BlackBerry / BlackBerry
Connect, Wap Portal, Streaming, Directory
Service, Automatic Device Management,
Phonebook Backup over GPRS, STK
16
menus, USSD menus and all roaming
services (Prepaid roaming, GPRS
roaming...)
OTA offers prepaid, postpaid and hybrid
postpaid-prepaid services under its ÒDjezzyÓ
and ÒAlloÓ brands and has become the
market leader and trendsetter with the
highest brand recognition and preference.
As of December 31st, 2009, prepaid
subscribers represented over 96% of OTA's
total subscribers' base. OTA offers its
loyalty program ÒImtiyazÓ to its prepaid and
postpaid subscribers allowing them to
accumulate points when using their mobile
phone and convert them into free airtime,
handsets or other rewards and advantages.
Ownership and Governance
Following the completion of an agreement
to purchase an additional 1.21% stake in
Oratel in November 2006, OTH directly
and indirectly owns 96.81% of OTA.
 17
Mobilink - PAKISTAN
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Financial Data Operational Data
December September December Inc/(dec)
December December Inc/ 2008 2009 2009 Dec. 2009 vs.
2008 2009 (dec) Dec. 2008
Operational Data
Financial Data
Subscribers 28,479,600 30,046,050 30,800,354 8.1%
Revenues (US$ 000) 1,207,520 1,058,463 (12.3%)
Market Share** 31.7% 30.9% 31.5% (0.2%)
Revenues (PKR bn) 87.4 86.8 (0.7%)
ARPU (US$) (3 months) 3.0 2.8 2.9 (3.3%)
EBITDA (US$ 000)* 491,664 384,781 (21.7%)
ARPU (PKR) (3 months) 243 234 242 (0.4%)
EBITDA (PKR bn)* 34.93 31.70 (9.2%)
Avg MOU (YTD) 172 198 198 15.4%
EBITDA Margin 40.7% 36.4% (4.4%)
Churn (3 months) 11.8% 5.3% 5.2% (6.6%)
Capex (US$ m) 537 157 (71%)
* EBITDA excludes management fees which were previously treated as a cost in each subsidiary and as a revenue for the Holding. ** Market share, as announced by the Pakistani Regulator is based on information disclosed by the other operators which
use different subscriber recognition policies.
OTH ANNUAL REPORT 2009
Mobilink - PAKISTAN
Pakistan Mobile Communications Limited
(ÒMobilinkÓ or ÒPMCLÓ) operates the leading
GSM network in Pakistan and provides a
range of prepaid and postpaid voice and
data telecommunication services to both
individual and corporate subscribers.
Mobilink launched its operations in August
1994, after it was founded in 1990 as a
joint venture between Motorola and the
Saif Group.
Mobilink's network is the most extensive
in Pakistan, reaching over 73% of the total
population and 100% of the urban
population as of December 31st, 2009,
delivered through 8,066 cell sites and 73
switches. Mobilink enjoys the most
widespread retail channel in the country,
with over 420 Franchise Centers, more
than 1800 customer care center touch
points and over 180 thousand retailers
throughout Pakistan.
Mobilink served over 31 million subscribers
as of December 31st, 2009, representing
a market share, as calculated by the
company, of approximately 40% of the total
mobile subscribers in Pakistan. According
to Pakistan Telecommunication Authority
(PTA), Mobilink's market share is 31.50%,
but this market share is based on
information disclosed by the operators each
of which use different subscriber recognition
policies.
Pakistani Telecommunication Market
Telecommunication services in Pakistan
are provided by Fixed Local Loop (FLL)
operators, Wireless Local Loop operators,
mobile operators and Long Distance and
International (LDI) operators. Pakistan
Telecommunication Limited (ÒPTCLÓ), the
incumbent FLL and LDI operator enjoys
the highest share among FLL and LDI
operators. PTCL is 62% state-owned, 26%
is held by Etisalat and the remaining 12%
is with the public. PTA issued 12 new
licenses to provide long distance and
international services. There are currently
five mobile operators in Pakistan: Pakistan
Mobile Communication Limited (ÒMobilinkÓ),
CMPak Limited (ÒCMPak - formerly
PaktelÓ), Pakistan Telecom Mobile Limited
(ÒUfoneÓ), a subsidiary of PTCL, Telenor
Pakistan and Warid Telecom providing
GSM services. WLL operators did not enjoy
much penetration in the Pakistani market
registering only 2.65 million subscribers
until December 2009 as per PTA reports
with PTCL, Telecard and World Call being
the major operators.
The year 2009 remained a tough year for
Pakistan during which political instability,
inflation, currency devaluation, slow GDP
growth and gas and electricity load
shedding remained as major challenges,
with pressures easing towards the year
end. The political instability had a major
impact on the cellular industry, resulting in
the non-availability of cell sites in war-hit
areas.
License
Mobilink was awarded a 15-year license
in July 1992 to establish and operate a
digital cellular telecommunication system
using the GSM 900 standard and to offer
telecommunication services in Pakistan.
The license was renewed in 2007 for a
further period of 15 years. On June 26th,
2006 Mobilink was granted another Azad
Jammu & Kashmir (AJ&K) and Northern
Areas (NAs) license also for a period of 15
years.
Network
As of December 31st, 2009, Mobilink's GSM
network covers more than 10,000 cities,
towns and villages and provides on-road
coverage along all of the nation's major
highways. In addition to voice, Mobilink
also has the largest data network in the
country.
Services and Marketing
2009 was a year full of intense competition,
introduction of new services and consumer
and operator friendly regulations. The price
war going on between mobile operators
greatly benefited consumers who were
being offered attractive new packages and
value added services. Rivals in the industry
created waves by launching new packages,
such as smaller pulse packages, low cost
SMS bundles, late night offers etc. while
the facility to change network (Mobile
Number Portability) without changing
number has eliminated the non-cash cost
of switching, and pushed the competition
among mobile operators to a boiling point.
Mobilink markets its prepaid services under
the brand name 'Jazz' which offers different
packages to suit the need of diverse
customer segments. Mobilink markets its
postpaid services using the brand name
'Indigo', which offers different packages
and value added services for corporate
and individual customers. The brand
commands a premium image in the market
and is being used by several leading
corporations of the country.
18
Mobilink aligned itself in 2009 to protect
its market share, maintain its revenues and
decrease its operational costs. With the
market rates dropping, Mobilink started the
year with its basic tariff adjustment (Rs.
0.68 per 30 sec through Jazz Budget
package) which helped reduce churn and
bring new subscribers on board. Following
the price moves, Mobilink remained
aggressive both in voice as well as VAS
offers throughout the year. Customer
acquisition and retention promos also
played an important part in increasing the
subscriber base and maintaining market
share. At the same time, Mobilink VAS
showed significant growth fueled by product
life cycle management of top services like
Mobitunes, Power Tools and Juke Box etc.
Mobile Financial Services
Mobilink entered the Mobile Financial
Services area in both the banked and
unbanked space through the launch of
Mobilink Genie and Mobile Money Order.
Taxation
In 2009, the government reduced the
General Sales Tax slightly from 21% to
19.5% and the Activation Tax from Rs. 500
to Rs. 250 which provided relief to the
industry. Additionally, the Import Duty on
mobile handsets was reduced by 66% from
Rs. 750 to Rs. 250.
Ownership and Governance
Orascom Telecom Holding indirectly owns
100% of the share capital of Mobilink
through direct stakes held by wholly owned
subsidiaries of OTH.
 19
Mobinil - EGYPT
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Financial Data Operational Data
December September December Inc/(dec)
December December Inc/ 2008 2009 2009 Dec. 2009 vs.
2008 2009 (dec) Dec. 2008
Operational Data
Financial Data
Subscribers 20,115,377 24,624,733 25,354,209 26.0%
Revenues (US$ 000)** 890,949 944,133 6.0%
Market Share 47.2% 43.6% 42.0% (5.2%)
EBITDA (US$ 000)*** 429,683 460,457 7.2%
ARPU (US$)* (3 months) 7.6 6.7 6.5 (14.5%)
EBITDA Margin 48.2% 48.8% 0.5%
ARPU (EGP)* (3 months) 42 37 36 (16.0%)
Capex (US$ m) 524 472 (10%)
Avg MOU (YTD)* 165 176 173 4.8%
Churn (3 months)* 8.8% 8.4% 10.8% 2.0%

* ARPU, MOU & Churn expressed under OTHÕs definition may differ from MobinilÕs disclosed figures. *** Proportionate consolidated figures.
** Proportionate consolidated figures EBITDA excludes management fees which were previously treated as a cost in each subsidiary and as a revenue for the Holding.
OTH ANNUAL REPORT 2009
Mobinil - EGYPT
The Egyptian Company for Mobile Services
(Mobinil or ECMS) operates the leading
mobile telecommunications network in Egypt
and provides a range of prepaid and
postpaid voice and data telecommunications
services, under the brand name ÒMobinilÓ.
Mobinil launched its operations in May
1998. As of December 31st, 2009, Mobinil's
network covered approximately 99.66% of
the total population of Egypt.
Mobinil has been serving over 25 million
subscribers as of December 31st, 2009, as
it continues to lead the market share in
Egypt with 42% of total mobile subscribers
in Egypt.
Egyptian Telecommunications Market
Fixed line services are provided exclusively
by Telecom Egypt, the incumbent 80%
government-owned operator, with nearly
11 million customers. Three GSM mobile
operators, Mobinil, Vodafone Egypt and
Etisalat, compete to serve more than 60
million Egyptians, providing a variety of
voice and data services. Egypt also has
the largest number of internet users in the
region, using both dial up, and increasingly
broadband services.
A second fixed license was mooted, after
Telecom Egypt's monopoly expired at the
end of 2005. But this has been indefinitely
postponed due to the adverse global
financial climate. Etisalat acquired its own
limited gateway, while Vodafone chose to
continue to route its international traffic
through the Telecom Egypt gateway.
Mobinil has continued to use the Telecom
Egypt gateway while studying the IGW
option. Recently, the NTRA is about to
offer licenses to provide triple play services
to gated communities.
License
Mobinil was granted a license in 1998 to
operate a GSM mobile telecommunications
network and to provide a range of
telecommunications services in Egypt. The
license, amended in January 2005 by the
National Telecommunication Regulatory
Authority (NTRA), is a 15-year dual band
license with automatic renewal for
successive five-year periods if Mobinil
complies with the license requirements. As
Mobinil signed the 3G license agreement
in October 2007, the 2G license has been
extended till 2022 as will the 3G license.
Network
Following the successful launch of 3G in
2008, Mobinil managed to sustain its
market leadership throughout 2009 by
reinforcing, not only network capacity, but
also network coverage, quality of service
and following through on its commitment
to modernize its network elements to
ensure the most up-to-date technology with
the best quality of service.
By the end of 2009, Mobinil's territory
coverage reached 22.87% reaching
99.66% of the population. Network capacity
has been significantly increased in 2009
to cope with the market demand.
Services and Marketing
Mobinil continued to lead the market with
a variety of offers and propositions for its
consumer as well as enterprise markets.
Its commercial activities primarily revolved
around offering best value for money for
customers with their varying communication
needs as well as budgetary constraints.
2009 was a very active year for Mobinil on
the consumer market front with propositions
for both prepaid and postpaid customers.
Targeting its prepaid customers, Mobinil
launched a series of plans with some of
the lowest per minute rates in the market,
such as El Masry line or the Ahla Kalam
tariff plan. Further offers were extended to
the customers in rural areas, reinforcing
the fact that Mobinil's customers residing
outside the main cities are as much a
priority to the company as urban residents.
Other offers targeting high school diploma
students encouraged the youth segment
to discover the world of mobile
communication with free minutes and SMS.
A memorable year-closer for the company
was that of the Mobinil Grand Trivia contest
which offered very lucrative cash prizes to
customers who partake in a trivia contest
via SMS or Interactive Voice Reply (IVR).
The contest yielded total net winnings of
LE 11.1 million, higher customer
engagement and SMS usage, and higher
credibility for Mobinil.
Postpaid customers were able to reap the
benefits of a revamp of Mobinil's Star tariff
plans, allowing for free minutes to Mobinil
users, mobile users and landlines,
depending on the selected plan. In addition,
a loyalty Star Awards Program was instated
to foster loyalty among, and retain the high
customer base.
20
Another significant achievement for Mobinil
in 2009 was the enhancement of the
company's Mobile Broadband (MBB)
activities. Offers on USB modems, laptops
and netbooks also made the Internet
accessible to a wider layer of the Egyptian
market. The introduction of prepaid internet
lines increased customer potential to
purchase broadband products.
Finally to close 2009, Mobinil introduced a
new Unlimited offer which gave customers
high speed connectivity up to 4 GB.
Mobinil also introduced the latest iPhone
3GS as well as the full range of BlackBerry
devices. BlackBerry service was also
extended to prepaid customers.
On the enterprise market front, Mobinil
focused on both voice and Internet services.
Mobinil launched its Office Anywhere
service using the Flybox - offering WiFi
coverage for several users in a certain
locale. Prepaid business tariff plans were
also among the company's 2009
achievements. Another major launch in
2009 was that of Blackberry services for
the enterprise market.
Ownership and Governance
Mobinil is owned by OTH, FT Group and
public market equity investors. Orascom
Telecom has a 34.66% economic interest
and FT Group has a 36.34% economic
interest, in ECMS. The remaining shares
of ECMS (29%) are publicly traded on the
Egyptian Stock Exchange.
 21
Tunisiana - TUNISIA
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Financial Data Operational Data
December September December Inc/(dec)
December December Inc/ 2008 2009 2009 Dec. 2009 vs.
2008 2009 (dec) Dec. 2008
Operational Data
Financial Data
Subscribers 4,256,573 4,807,677 5,210,926 22.4%
Revenues (US$ 000)* 326,110 356,675 9.4%
Market Share 51.1% 53.0% 53.4% 2.3%
Revenues (TND bn) 432.2 482.3 11.6%
ARPU (US$) (3 months) 12.7 13.1 11.6 (8.7%)
EBITDA (US$ 000)** 188,912 192,227 1.8%
ARPU (TND) (3 months) 17 17 15 (11.6%)
EBITDA (TND bn)** 232.71 260.58 12.0%
Avg MOU (YTD) 158 172 171 8.5%
EBITDA Margin 57.9% 53.9% (4.0%)
Churn (3 months) 8.0% 5.5% 4.4% (3.6%)
Capex (US$ m) 99 91 (8%)
* Proportionate consolidated figures ** Proportionate consolidated figures.
EBITDA excludes management fees which were previously treated as a cost in each subsidiary and as a revenue for the Holding.
OTH ANNUAL REPORT 2009
Tunisiana-TUNISIA
Orascom Telecom Tunisie (ÒTunisianaÓ or
ÒOTTÓ) operates a GSM network in Tunisia
and provides a range of prepaid and
postpaid voice and data
telecommunications services, under the
brand name "Tunisiana". Tunisiana
launched its operations in December 2002
and, as of December 31st, 2009, its network
covered more than 99% of the total
population of Tunisia.
In 2009, Tunisiana maintained its position
as market share leader and ended the year
with 5.2 million subscribers, representing
a market share of approximately 53.36%
of total mobile subscribers in Tunisia.
To reach this result, Tunisiana managed
to acquire over 59.07% of the total market
gross adds and almost 61.5% of the total
market net additions.
Tunisian Telecommunications Market
Telecommunications services in Tunisia
are provided currently by 3 operators:
Tunisie TŽlŽcom, the incumbent
telecommunications operator which offers
Mobile, fixed telephony and Internet
services, Tunisiana the private telecom
operator in Tunisia which offers only mobile
telephony services and Orange Tunisia
that will provide fixed and mobile telephony
added to 3G and Internet access services.
The Tunisian government has partially
privatized Tunisie TŽlŽcom by selling a
35% stake of the company to Dubai Group
TeCom-DIG in March 2006.
In the context of the progressive
liberalization of the telecommunications
market in Tunisia, a third operator, Divona
Telecom in partnership with Orange was
granted a license in June 2009, following
a successful bid of approximately TND 257
million. The licence allows the new operator
to operate a national telecommunications
network and to provide fixed and mobile
telephony, 3G and Internet access services.
Alongside the Ministry of Technologies of
Communication, the NTC is also involved
in the development of telecommunications
sector by providing the necessary
environment to establish a fair and healthy
competition among players and actors.
License
OTT was granted a license in May 2002
to operate a national GSM
telecommunications network and to provide
a range of the telecommunications services
in Tunisia. The license was granted for a
fee of US$454 million, payable in two equal
installments, which were paid in May 2002
and September 2004. Tunisiana's license
has a duration of 15 years and is renewable
for consecutive five-year periods, provided
that OTT has met its obligations under the
license in the prior period.
Network
As of December 31st, 2009, TunisianaÕs
network provided coverage over an area
encompassing over 99% of Tunisia's
population and 90% of its geographic
territory. Tunisiana network consists of
2107 cell sites and 13 switches.
International traffic is serviced through 4
international gateways.
Services and Marketing
Tunisiana offers both prepaid and postpaid
telephony services. As of December 31st
2009, prepaid subscribers represented
around 97.7% of Tunisiana's total
subscribers.
Tunisiana provides both basic voice and
value-added services to its corporate and
residential subscribers. In addition to basic
voice services, Tunisiana provides its
subscribers with value-added services such
as voice SMS, voicemail, detailed monthly
billing, SMS Billing, call line identification
presentation or restriction, call
waiting/holding, call forwarding, mobile-
banking, reversed roaming, international
roaming and data services. Tunisiana's
network offers GPRS technology, which it
launched in February 2006, as well as
EDGE technology. Tunisiana is providing
a range of value-added services based on
these technologies including MMS, Internet,
WAP portal, e-mail push and Data.
In addition to VAS, Tunisiana launched
new services in 2009, such as international
top-up (from France), e-shop site, USSD
bill payment. Furthermore, Tunisiana began
providing BlackBerry service, but have yet
to commercially launch it.
During 2009, Tunisiana focused on
community and abundance offers, such as
22
Amigos, a group calling plan targeting the
youth segment, Familia and Dhayafni, both
group sharing plans aimed at postpaid and
prepaid subscribers respectively. Other
abundance offers were developed to
maintain high network traffic. Tunisiana
also focused on capturing migrant
subscribers to postpaid offers, and
encouraged high value postpaid and
business customers through a
diversification of services, as well as loyalty
and retention programs. Finally, Tunisiana
released international offers to boost
international usage.
In 2009, Tunisiana decreased the SMS
tariff (0.050 NTD instead of 0.060 NTD) in
order to remain competitive with regards
to Tunisie TŽlŽcom.
In order to boost Internet usage, Tunisiana
repriced many of its Internet bundles.
Ownership and Governance
Orascom Telecom Holding has a 50%
economic interest in OTT through two
wholly-owned subsidiaries which own 35%
and 15% of the shares in OTT, respectively.
During 2005, OTH increased its economic
interest in OTT from 20.27% to 50%. The
remaining 50% interest is held by National
Mobile Telecommunications Company KSC
(ÓWataniya TelecomÓ), a Kuwaiti
telecommunications company, which was
sold to Qatar Telecom during 2007.
 23
banglalink - BANGLADESH
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Financial Data Operational Data
December September December Inc/(dec)
December December Inc/ 2008 2009 2009 Dec. 2009 vs.
2008 2009 (dec) Dec. 2008
Operational Data
Financial Data
Subscribers 10,337,128 12,135,528 13,886,913 34.3%
Revenues (US$ 000) 288,144 350,994 21.8%
Market Share** 23.2% 24.2% 26.8% 3.6%
EBITDA (US$ 000)* 13,683 117,238 n.m.
ARPU (US$) (3 months) 2.5 2.5 2.3 (6.7%)
EBITDA Margin 4.7% 33.4% n.m.
ARPU (EGP) (3 months) 175 174 163 (7.0%)
Capex (US$ m) 407 122 (70%)
Avg MOU (YTD) 256 259 253 (1.3%)
Churn (3 months) 1.9% (5.5%)*** (0.6%)*** (2.5%)
** Market share, as announced by the Regulator in Bangladesh is based on information disclosed by the other operators
* EBITDA excludes management fees which were previously treated as a cost in each subsidiary and as a revenue for the Holding. which use different subscriber recognition policies.
*** Negative figure due to a customer reactivation program
OTH ANNUAL REPORT 2009
banglalink - BANGLADESH
Orascom Telecom Bangladesh Limited
(ÒbanglalinkÓ or ÒOTBÓ) is a GSM
telecommunications operator in
Bangladesh and provides a range of
prepaid and postpaid voice and data
telecommunications services, using the
TM
brand name Òbanglalink .Ó Operating in a
highly competitive market populated by six
mobile operators, banglalink was the fourth
entrant in the market, and commenced
operation in Feb 2005. banglalink soon
overtook the market position of Robi (former
ÒAKTELÓ) to become the second largest
operator in Bangladesh within less than 3
years of operation.
As of December 31st, 2009, banglalink's
network covered over 94% of the total
population of Bangladesh with over 13.89
million subscribers and a market share of
over 26.8%. This phenomenal growth is
based on the overwhelming response to
banglalink's products and innovative
services, a strong brand image, an
extensive distribution network, and
continuous improvement in service quality.
Bangladeshi Telecommunications
Market
Telecommunications services in
Bangladesh are provided by 5 GSM and
1 CDMA mobile operators, and 13 land
line operators. The oldest mobile operator
is still the only CDMA operator, Pacific
Bangladesh Telecom Ltd. (ÒCitycellÓ), in
which SingTel acquired a minority interest.
The five GSM operators are, in order of
launch date, GrameenPhone (GP) the
market leader, 55.8% owned by Telenor
Mobile Communications AS, 34.2% held
by Grameen Telecom and has a 10% stake
floated to the public through an IPO in
2009. GP, is a publicly listed company
listed in both the stock exchanges of
Bangladesh. AXIATA (Bangladesh) Ltd
(former TM International Bangladesh Ltd.)
(ÒAKTELÓ), the third largest player is a joint
venture company in which Axiata holds
70% and NTT DoCoMo holds a 30% stake.
Orascom Telecom Bangladesh Ltd.
(ÒbanglalinkÓ), Teletalk Bangladesh Ltd.
(ÒTeletalkÓ), the state owned mobile
operator, and Warid Telecom (ÒWaridÓ) all
launched operations in 2007. The
Bangladesh Telecommunications
Company Limited (ÒBTCLÓ) is the
incumbent state-owned fixed-line operator
that has been present from the beginning.
The remaining private fixed line operators
were issued licenses a few years ago.
License
banglalink was issued a nationwide 15-
year GSM license in November 1996 that
is valid until 10 November 2011.
Network
With the help of an aggressive network
roll-out since launch, banglalink's network
extends all across the country in all 64
districts of the country and covers over
94% of the population. The primary focus
in recent years has been on ensuring
continuous improvement in the quality of
the network.
Services and Marketing
banglalink's marketing strategy focused on
targeting different consumer segments with
specially designed products and services
that are tailored to the needs of these
segments. banglalink's prepaid brand,
Òbanglalink deshÓ, is perceived as the best
prepaid package in the country with
innovative and value for money features
and a very strong brand image. Òbanglalink
businessÓ and Òbanglalink SMEÓ caters to
the needs of the business segment
including the thriving SME sector where
banglalink has been the pioneer in the
country. In 2009, banglalink set another
benchmark in the industry as it started
offering value propositions catering to the
needs of different 'micro-segments' through
below-the-line promotions.
banglalink provides its subscribers with a
wide range of innovative value-added
services including caller ring-back tone,
music station, song dedication, voice portal,
voice chat, voice-SMS etc to name a few.
In 2009, banglalink also launched Call
Block, Friend Finder, Field Force Locator,
Vehicle Tracking and call-center based
information services 'banglalink Krishi
jigyasha 7676' and 'banglalink Babsha
24
jigyasha 7677', which provide advisory
service regarding agriculture and SME
business queries respectively. 'banglalink
jigyasha' services won the Asia Mobile
Awards 2009 under the category Best
Mobile Enterprise Application Product or
Service. banglalink has already established
a nationwide EDGE/GPRS network serving
both postpaid and prepaid subscribers.
banglalink's international roaming network
comprises of 250 operators across 95
countries and EDGE/GPRS connectivity
is available to roaming customers as well.
banglalink's customer care services are
regarded as the best in the mobile industry
of Bangladesh. A state-of-the art call center
with highly trained agents provides round
the clock service to customers. banglalink
is also the pioneer in taking customer
service closer to its subscribers by
introducing Òbanglalink service pointsÓ in
over 1,000 locations across the country -
by far the widest in the industry. A dedicated
team of relationship managers provides
exclusive services to business customers.
Ownership and Governance
Orascom Telecom Holding owns 99.9998%
of the shares of banglalink. Orascom
Telecom Bangladesh Limited (banglalink)
was incorporated in Bangladesh under the
Companies Act 1994 which is obliged to
comply with the laws of land.
 25
Telecel Globe
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Financial Data Operational Data
December December Inc/(dec)
December December Inc/ 2008 2009 Dec. 2009 vs.
2008 2009 (dec) Dec. 2008
Operational Data
Financial Data
Subscribers 894,822 1,823,000 n.m
Revenues (US$ 000) 25,345 81,384 n.m
EBITDA (US$ 000)* 492 (202) n.m
EBITDA Margin 1.92% (0.2%) 2.1%

* EBITDA excludes management fees which were previously treated as a cost in each subsidiary and as a revenue for the Holding.
OTH ANNUAL REPORT 2009
Telecel Globe
Telecel Globe, a wholly owned subsidiary
of Orascom Telecom Holding, launched
its operations in February 2008. It is an
international telecommunications company
that manages GSM operators in small and
medium sized countries in Sub-Saharan
Africa with high growth potential.
It currently manages four GSM networks
in the Central African Republic, Burundi,
Namibia and Zimbabwe and plans to
continue expanding its footprint by acquiring
or developing other operators.
Telecel Globe positions its networks as
market leaders and strives to improve the
quality of life of the people in the markets
which it operates in by increasing network
coverage, improving network quality and
introducing new value added services such
as data services, prepaid roaming and air
time credit transfer. The portfolio of VAS
on offer by its operators is being
aggressively expanded as the new state-
of-the-art networks allow more innovative
services and promotions to be
implemented, increasing customer
satisfaction and ARPUs.
Telecel Globe has also established the
Telecel Globe Foundation to serve the
local communities in the countries in which
it operates. The Foundation regulates all
the Group's CSR activities to ensure that
all operators are responsible corporate
citizens that give back to their communities.
Cell One (LeoTM) - Namibia
Telecel Globe acquired Cell One Namibia
in January 2009. The Namibian telephony
market has a penetration rate of about 77%.
Cell One is currently competing for the
growth opportunities against MTC, a GSM
operator partially owned by Namibia Post
and Telecommunications Holding (NPTH)
and Portugal Telecom (PT), and Telecom
Namibia, which is wholly owned by the
Government and is a subsidiary of Namibia
Post and Telecom Holdings Limited.
Cell One operates GSM
900/1800/3G/HSDPA networks and is
currently the market challenger with
268,480 subscribers and about 16.5%
market share, as of December 31st, 2009.
Cell One offers a range of basic and value
added voice and data services, such as
missed call alert, roaming, 3G, GPRS,
airtime credit transfer, conference call,
credit balance query, call
waiting/forwarding, voice-fax-to-email,
internet browser, and email. CellOne's
network infrastructure provided coverage
to over 63% of the Namibian population.
In 2009, Cell One rebranded its commercial
activities to start operating under the name
LeoTM.
U-COM (LeoTM) - Burundi
In 2008, Telecel Globe acquired 100% of
the shares of U-COM, the leading
telecommunications network in Burundi.
Burundi has an emerging telephony market
with a penetration rate of 11.4%, thus
availing growth opportunities for existing
operators. U-COM is currently competing
against Africell, Econet, Onamob.
U-COM Burundi operates GSM 900/1800,
CDMA 800, and WIMAX (in Bujumbura)
networks and is the market leader with
659,589 subscribers and over 72% market
share, as of December 31st, 2009.
U-COM provides voice and data services
to both its pre-paid and postpaid customers
covering around 42% of the Burundi
population. Such offerings range from basic
services to value added services, such as
missed call alerts, 5 numbers for friends
and family, roaming, airtime credit transfer,
conference call, credit balance query and
call waiting.
U-Com also operates under the commercial
brand name LeoTM.
Telecel - CAR (Central African Republic)
Telecel Globe acquired 100% of Telecel-
CAR in July 2008. The Central African
Republic's (CAR) telecommunications
market had a penetration rate of 14.9%,
as of December 31st, 2009, providing
substantial growth opportunities for Telecel-
CAR. Current competitors in CAR are
Nationlink, Orange and Moov.
Telecel-RCA operates GSM 900/1800
26
networks and is the market leader with
303,142 subscribers and over 45% market
share, as of December 31, 2009. Telecel-
RCA provides voice services to both its
pre-paid and postpaid customers covering
around 50% of the countryÕs population.
Such services range from basic to value
added ones, such as call waiting/holding,
call forward, CLIP/CLIR, friends and family
(CUG) postpaid and prepaid, location
based tariffs, SMS, SMS international,
USSD balance enquiry, voicemail, credit
alert, credit transfer and bulk SMS.
Telecel Zimbabwe - Zimbabwe
Telecel was established in 1995 and began
operating a GSM mobile network in 1998.
As of December 31st, 2009, the mobile
penetration rate in the country stood at
approximately 25% and Telecel Zimbabwe
had approximately 592,160 subscribers
through its GSM network, equivalent to a
20% market share. Telecel's network
covered over 68% of the population in
Zimbabwe.
Telecel Globe signed a management
agreement with Telecel Zimbabwe in July
2009, retroactive to January 1st, 2009.
Pursuant to that agreement, Telecel Globe
has assumed operational management of
Telecel Zimbabwe.
 27
koryolink
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Financial Data Operational Data
December September December Inc/(dec)
December December Inc/ 2008 2009 2009 Dec. 2009 vs.
2008 2009 (dec) Dec. 2008
Operational Data
Financial Data
Subscribers 1,694 69,261 91,704 n.m.
Revenues (US$ 000)** - 25,951 n.a.
Market Share 100.0% 100.0% 100.0% 0%
EBITDA (US$ 000)* - 17,153 n.a.
ARPU (US$) (3 months)** n.a. 21.6 24.5 n.a.
EBITDA Margin n.a. 66.1% n.a.
Avg MOU (YTD) n.a. 215 239 n.a.
Capex (US$ m)** n.a. 27 n.a.

* EBITDA excludes management fees which were previously treated as a cost in each subsidiary and as a revenue for the Holding. ** Based on the official exchange rate between the North Korean Won (KPW) and US$.
OTH ANNUAL REPORT 2009
koryolink - Democratic People's Republic of Korea
koryolink's subscriber base has grown to
reach 91,704 for the year ended December
31st,2009. Since its launch in December
2008, koryolink has been received very
positively in the market being the first full
fledged operator in the DPRK to offer state
of the art mobile services at attractive
prices.
During its first year of operation, koryolink
has established many precedents in the
Korean market. Despite the lack of active
marketing and advertising industries,
koryolink succeeded in creating awareness
and educating consumers about its different
products and services through advertising
the company's launch in major newspapers
and radio stations as well as producing
different types of communication material
(flyers, posters, danglers, etc.). Additionally,
koryolink was able to provide continuous
support to its subscribers through
establishing the first of its kind Call Center
in the country.
By the end of 2009, koryolink had
embarked upon the realization of its
ambitious expansion plan to cover the
entire territory of DPRK with the 3G mobile
service. 2009 also witnessed another
important development for koryolink, the
opening of the first sales outlet outside the
capital Pyongyang in Sariwon City. The
sales outlet in Sariwon is the first one of
many outlets in various large cities across
the country to be opened as the koryolink
coverage expands to cover more and more
parts of the entire DPRK.
koryolink had previously kicked off its direct
sales network with one centralized shop
in Pyongyang, and by the end of 2009, two
additional sales shops were added. Apart
from the sales shops, koryolink developed
an indirect sales network consisting of nine
outlets located inside KPTC's post offices
throughout Pyongyang. These outlets
helped in increasing the operator's footprint
28
and availing its Scratch Cards to
subscribers located in different areas
throughout the city.
By the end of 2009, koryolink's network
currently has 153 on air base stations
covering Pyongyang as well as 6 cities
(Pyongsong, Anju, Kaechon, Nampo,
Sariwon, and Haeju) and 8 highways
(Hyangsan, Sariwan, Tangun Tomb,
Nampo, Haeju-Sariwon, Sariwon -Kaesong,
Haesong railway and the airport road). The
network supports a variety of services - in
addition to voice - such as video call, SMS,
MMS, voice mail, WAP and HSPA.
 29
WIND Mobile- Canada
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Globalive Wireless Management Corp.
(ÒGWMCÓ), operating its wireless business
under the brand name WIND Mobile,
successfully launched services in Toronto
and Calgary on December 16th and 18th,
2009 respectively, after having undergone
a protracted legal and regulatory marathon
to establish that it met Canadian ownership
and control requirements. The process
culminated with the Government of Canada
effectively approving GWMC as a Canadian
Wireless Operator.
WIND Mobile is aiming to become the
fourth national wireless carrier with its fully
enabled HSPA network and offerings of
Voice; Text; and Data plans. WIND Mobile
introduced new concepts to the Canadian
wireless market through its combination of
no contracts, unlimited plans, Canada wide
calling features, and the redefinition of
'Home Zones'.
GWMC is on track to launch service to the
public in Ottawa and Edmonton within the
first quarter of 2010, followed by a efforts are underway to expand distribution
Vancouver launch in the 2nd quarter. to 3rd party retailers. The state of the art
in-house call center was fully in service at
GWMC enjoys the benefit of national and the time of WIND Mobile's launch in
international roaming services through December 2009.
various partners.
WIND Mobile's subscriber base at the end
Over 30 outlets were opened by the end of 2009 was close to 5,000 subscribers.
of 2009 with the help of two branded
distribution channels: WIND Mobile stores
and kiosks, in addition to a partnership with
media retailer 'Blockbuster'. Ambitious
 2009 Financial Review

CONTENT:

Board Report

Financial Statements (IFRS/US$)

Financial Statements (EAS/EGP)

31

Orascom Telecom Holding Board Report

Highlights ARPU In Tunisia, the seasonality trends contributed to the decline in

ARPU in Q4 09 compared to the previous quarter. ARPU in Q4
During the year 2009, ARPU was negatively impacted by the ef- 09 declined compared to Q4 08, due to the fact that during Q4
• TOTAL SUBSCRIBERS were just under 93 million, an increase of 19% over 2008. fect of the depreciation of the local currencies against the US$ in 09 OTT introduced many offers to stimulate acquisitions in lower
• EBITDA reached US$ 2,172 million1 (LE 12,183 million), a decrease of 8.9% over the previous year. On a pro-forma basis2 YoY Algeria, Pakistan and Tunisia. The negative impact has however income market segments. The ongoing high subscriber growth
EBITDA decreased only by 7.2%. EBITDA for OTA decreased by 6.6% in local currency vs. a decrease of 17.3% in US$, EBITDA for become less relevant in H2 09 as the local currencies have stabi- trend in Mobinil throughout the year, coupled with the change
Mobilink decreased by 9.2% in local currency vs. a decrease of 22% in US$, EBITDA for Tunisiana increased by 12% in local cur- lised against the US$. In local currency terms ARPU was stable in in subscriber mix with an increasing penetration in the lower
rency vs. an increase of only 2% in US$, and grew by 7.2% in Egypt where the local currency was stable against the US$. Mobilink, while it decreased over the previous year in OTA and in market segment, caused ARPU in Egypt to decline. The decline
• NET INCOME for the period reached US$ 318 million1 (LE 1,845 million). Q4 Net Income was mainly impacted by: the unfavourable OTT. To offset the impact of the unfavourable climate and fierce was further enhanced by the highly aggressive pricing launched
events that took place in Algeria, as well as the increase in the Tax Rate in Pakistan. Tax provision for OTA’s tax assessment in 2009 competitive environment in Algeria, OTA focused more on retain- by Etisalat in Q2 and Q3 to which the other players, including
was US$ 50 Million of which US$ 40 Million were formed in Q4 09. ing its subscriber base by introducing strong retention campaigns Mobinil, responded with aggressive tariff plans, which have been
• REVENUES of US$ 5,065 million1 (LE 28,262 million), decreased by 4.9% compared to 2008. On a pro-forma basis2 YoY revenues rather than animating the market. This had a negative impact on withdrawn in Q4. Despite the high subscriber growth, ARPU in
remained stable (-0.6%). In local currency revenues for OTA and Mobilink were stable vs. a decrease of 8.5% and 12.3% in US$ the outgoing ARPU. In addition, the new yearly interconnection Bangladesh decreased only by a mid-single digit over the previ-
respectively. Revenues for Tunisiana increased by 12% in local currency vs. only an increase of 9.4% in US$. In Egypt and Bangla- rate implemented as of July (1.5 DZD vs. 2.6 DZD previously) ous year due to revenue enhancement initiatives aimed at the
desh where the local currency was stable against the US$, revenues grew by 6% and 22% respectively. impacted the incoming ARPU in Q4 09 compared to Q4 08. existing customer base.
• Group EBITDA margin was at 42.9%.
GSM EBITDA margin was at 47.8%. EBITDA margins of the major subsidiaries were: Djezzy 57.1%, Mobilink 36.4%, Mobinil 48.8%,
Tunisiana 53.9%, and banglalink 33.4%. Table 2: Blended Average Revenue Per User (ARPU)
• NET DEBT stood at US$ 5,113 million1 (LE 28,047 million) resulting in a Net Debt/EBITDA of 2.4x for the period, which on a pro-
forma basis including the US$ 800 Million proceeds from the Rights Issue will reach 2.0x. 31 Dec. 30 Sept. 31 Dec.
• EARNINGS PER GDR reached US$ 1.81 (based on a weighted average for the outstanding GDRs of 175.7 million over 12M 2009)3. Inc/(dec)
2008 2009 2009
• THE SITUATION IN ALGERIA – The recent riot events in Algeria following the football match had a negative impact on the opera- Subsidiary Dec. 2009 vs.
US$ US$ US$
tions. We estimate the impact on OTA Q4 2009 EBITDA to be around US$55 million between loss of revenue opportunity, damages Dec. 2008
(3 months) (3 months) (3 months)
of stock (SIM and scratch cards, handsets) and provision for taxes and around US$41 million below the EBITDA line (damage to
physical assets net of insurance and provision for Income tax). Djezzy (Algeria) 11.8 10.5 9.9 (15.8%)
Mobilink (Pakistan) 3.0 2.8 2.9 (3.3%)
1. US$ financial figures in the Income Statement & Balance Sheet are according to the International Financial Reporting Standards (IFRS).
Mobinil (Egypt)1 7.6 6.7 6.5 (14.5%)
2. After excluding M-Link and OrasInvest figures from 2008.
3. The outstanding GDRs as of December 31st, 2009 were 176 million. Tunisiana (Tunisia) 12.7 13.1 11.6 (8.7%)

Operational Performance banglalink (Bangladesh) 2.5 2.5 2.3 (6.7%)

koryolink (DPRK) - 21.6 24.5 n.a.
Subscribers ous year. As a result of the unfavourable events that took place in Alfa (Lebanon) - 49.3 40.0 n.a.
Q4 2009, the customer base in Algeria remained almost stagnant Global ARPU (YTD)2 6.6 5.8 5.7 (13.4%)
During the year 2009 Orascom Telecom continued to grow its compared to Q3 2009 resulting in only a 4% growth compared to
Global ARPU (3 months) 6.3 5.8 5.5 (12.8%)
customer base reaching almost 93 million subscribers, a 19% 2008. A significant contribution to customer base growth was also
growth over the previous year. Growth was particularly strong in delivered by Telecel Globe, with subscribers surpassing the 1.8
Bangladesh, up almost 35%, in Egypt, up 26%, and in Tunisia, up million mark, and by koryolink which counts almost 92 thousand Table 3: Blended Average Revenue Per User (ARPU) (Local Currency)
almost 23%. After the substantial inactive customer base clean- subscribers as of December 31, 2009. It is worth noting that the
up performed up to Q1 2009, subscribers’ growth in Pakistan has customer base of Alfa in Lebanon exceeded the 1 million mark 31 Dec. 30 Sept. 31 Dec. Inc/(dec)
resumed throughout the rest of the year reaching 30.8 million required in the management contract signed by OTH with the Subsidiary 2008 2009 2009 Dec. 2009 vs.
subscribers and demonstrating an increase of 8% over the previ- Republic of Lebanon in January 2009. (3 months) (3 months) (3 months) Dec. 2008
Djezzy (Algeria) (DZD) 799.0 765.9 721.4 (9.7%)
Table 1: Total Subscribers Mobilink (Pakistan) (PKR) 242.8 234.2 241.7 (0.4%)
Tunisiana (Tunisia) (TND) 17.0 17.4 15.0 (11.6%)
Investment 31 Dec. 30 Sept. 31 Dec. Inc/(dec)
2008 2009 2009 Dec. 2009 vs. 1. ARPU expressed under OTH’s definition may differ from Mobinil’s disclosed ARPU. Please see Appendix for definition.
Dec. 2008 2. Global ARPU is calculated on a Year to date basis, taking into account the weighted average subscribers for calculation, excluding Alfa.

Djezzy (Algeria) 14,108,859 14,726,081 14,618,166 3.6%

Mobilink (Pakistan) 28,479,600 30,046,050 30,800,354 8.1%
Mobinil (Egypt) 20,115,377 24,624,733 25,354,209 26.0%
Tunisiana (Tunisia) 4,256,573 4,807,677 5,210,926 22.4%
banglalink (Bangladesh) 10,337,128 12,135,528 13,886,913 34.3%
Telecel Globe 1
701,647 1,496,000 1,823,000 159.8%
koryolink (DPRK) 1,694 69,261 91,704 n.m.
Alfa (Lebanon) - 988,831 1,067,552 n.a.
Grand Total 78,000,878 88,894,161 92,852,824 19.0%

1. Includes Burundi, Central African Republic subscribers in December 2008, Burundi, Central African Republic, Namibia and Zimbabwe subscribers in September and De-
cember 2009.
32

Market Share & Competition
In 2009 OTH maintained its market leadership position in all its
countries of operation. In Bangladesh OTH has further strength-
ened its number two position. Market share in Egypt declined
marginally as a result of the increased competition and aggressive
market share promotions during the last three quarters. In Algeria
the attacks resulting from the football games caused interruptions
to the operational activities, which heavily impacted the market
share in Q4. Furthermore, market share declined as a result of
Table 4: Market Share & Competition
the slower approval process of Djezzy’s promotions by the local
regulator. Performance was outstanding in Bangladesh where
OTH increased its market share by 260bps over Q3. In Tunisia
market share increased slightly over the previous quarter. With
the growth trend resuming in Pakistan market share for Mobilink,
as reported by the regulator, grew to 31.5% over the previous
quarter. It should be noted that a number of competitors in Paki-
stan do not apply a strict churn policy. Mobilink’s market share
of active subscribers as measured internally on traffic patterns
remains above 40% as of December 31, 2009.
Financial Review
Revenues formance of Mobilink, with US$ revenues declining 12.3% against
a flat growth in local currency terms, of OTA, which recorded a
decline of 8.5% in US$ against a stagnant growth in local curren-
Consolidated revenues in 2009 declined mid-single digit over the
cy terms, and of Tunisiana, with US$ revenues up 9.4% against
previous year with GSM revenues only marginally down 1.9% and
an increase in local currency revenues of 11.6%.
a sharp decrease in Telecom Services revenues mainly as a result
In the countries of operation not impacted by currency fluctua-
of the exclusion of OrasInvest and M-Link from the 12M 2009
tions, performance remained strong with Mobinil growing 6.0%
scope of consolidation following their disposal.
over the previous year and banglalink recording an impressive
The performance in GSM revenues in 2009 vs. 2008 was the result
of the substantial weakening of the local currency against the US$ 21.8% growth over 2008, as a result of strong subscriber increas-
in Algeria, Pakistan and Tunisia. This effect was evident in the per- es in both operations.

Market Share (%) Table 6: Consolidated Revenues

Country Brand name Market Position Names of additional network operations
30 Sept 31 Dec. Q3 - 2009 Q4 - 2009
31 Dec. 31 Dec.
2009 2009 Inc/ Inc/
Subsidiary 2008 2009
(dec) (3 months) (3 months) (dec)
Algeria Djezzy 62.9% 59.4% 1 AMN, Qtel US$ (000) US$ (000)
US$ (000) US$ (000)
Pakistan 1
Mobilink 30.9% 31.5% 1 U-Fone, Paktel, Telenor, Al Warid GSM
Egypt Mobinil 43.6% 42.0% 1 Vodafone, Etisalat Djezzy (Algeria) 2,040,544 1,867,837 (8.5%) 478,841 447,553 (6.5%)
Tunisia Tunisiana 53.0% 53.4% 1 Tunisie Telecom Mobilink (Pakistan) 1,207,520 1,058,463 (12.3%) 258,982 270,473 4.4%
Bangladesh1 banglalink 24.2% 26.8% 2 Garmeen, Aktel, Citycell, BTTB, Al Warid Mobinil (Egypt) 890,949 944,133 6.0% 244,583 248,027 1.4%
1. Market share, as announced by the national Regulator is based on information disclosed by the other operators which use different subscriber recognition policies. Tunisiana (Tunisia) 326,110 1
356,675 9.4% 99,639 93,127 (6.5%)
banglalink (Bangladesh) 288,144 350,994 21.8% 89,070 91,559 2.8%
CAPEX simple free cash flow boost program which entails a reduction
of investments: mainly in Pakistan and Bangladesh. The “Other” Telecel Globe (Africa) 25,345 81,384 n.m. 20,836 23,591 13.2%
Capital expenditures in 2009 were substantially lower than the CAPEX mainly relates to investments made in 2009 in Telecel koryolink (North Korea) - 25,951 n.a. 5,984 7,495 25.2%
previous year mainly as a result of the implementation of OTH’s Globe, koryolink and our submarine cables. Total GSM 4,778,612 4,685,436 (1.9%) 1,197,934 1,181,825 (1.3%)
Telecom Services
Table 5: Capital Expenditure of OTH Subsidiaries for the nine months to December 311
Ring 228,252 210,896 (7.6%) 49,365 65,378 32.4%
Total Total M-Link 194,868 - n.a. - - n.a.
Country Service name US$ million US$ million Inc/(dec) OrasInvest 37,292 - n.a. - - n.a.
20085 20095 Other2 11,449 79,906 n.m. 23,299 25,530 9.6%
Algeria Djezzy 167 261 56% Total Telecom Services 471,861 290,802 (38.4%) 72,664 90,909 25.1%
Pakistan2 Mobilink 537 157 (71%) Total Internet Services 76,076 88,551 16.4% 20,499 22,783 11.1%
Egypt2 Mobinil 524 472 (10%) Total Consolidated 5,326,549 5,064,790 (4.9%) 1,291,097 1,295,517 0.3%
Tunisia Tunisiana 99 91 (8%)
1. Excluding intercompany revenues generated by M-Link.
Bangladesh banglalink 407 122 (70%) 2. Other Telecom Services Companies include C.A.T., OT Lebanon and TWA in 2009, C.A.T., Telecel Globe and TWA in 2008.
Other3 160 221 38%
Total 1,894 1,324 (30%)
Total Consolidated4 1,576 1,037 (34%)
Consolidated Capex/Sales 29.6% 20.5% (9%)
1. Based on 100% ownership of all subsidiaries.
2. Excludes intangible CAPEX of US$ 12 million in Pakistan for WiMax License, US$ 408 million in Egypt related to the 3G license fee in 2008.
3. “Other” companies include Linkdotnet, M-link, MedCable, Mena-Cable, OrasInvest, OT Holding, Ring and Telecel in 2008, and CHEO, Linkdotnet, MedCable, Mena-Cable,
OT Holding, Ring and Telecel Globe in 2009.
4. Consolidated CAPEX based on: 48.75% in ECMS and 50% in Tunisiana.
5. CAPEX components classification (e.g. tangible vs. Intangible) may differ from an operational perspective vs. an accounting one. The above figures have been prepared to
reflect CAPEX from an operational perspective, and may differ from CAPEX figures released in the financial statements.
33

Consolidated Revenues EBITDA Margins in Pakistan have also continued to suffer from the sharp
YoY increase in utility expenses as a result of the frequent power
Consolidated EBITDA in 2009 declined 8.9% over the previous outages on the national electricity grid. During the 12 months of
5,327 5,065 2009 Mobinil continued to perform well posting a 7.2% increase in
year mainly as a result of the decline in revenues resulting from the
currency weakness against the US$ in Algeria, Tunisia and Paki- EBITDA as a result of its on-net strategy and cost control mea-
stan. In Tunisia the performance in local currency terms was very sures. Compared to the previous year, banglalink delivered an
positive with a sharp increase over the previous year of 12% vs. a impressive performance in 2009 with EBITDA growing exponen-
slight increase of almost 2% in US$. EBITDA performance in OTA tially mainly as a result of the removal of subsidies on the SIM
was negatively impacted by the introduction of a new 5% sales tax tax. It is worth noting that the EBITDA decline at the consolidated
on mobile recharges to be borne by the mobile operators and not level is heavily impacted by the decrease in Telecom Services
4,779 4,685 passed on to the end user and to a lower extent by the introduc- EBITDA as a result of the exclusion of M-Link and OrasInvest
Total Consolidated tion of the new termination rates. Currency depreciation against from the scope of consolidation in 2009; as well as the decline of
the US$ in Pakistan declined sharply by 21.7% in US$ EBITDA the EBITDA of Ring.
Total Internet Services
Total Telecom Services
translating into a decline of only 9.2% in local currency terms.
Total GSM
Table 8: Consolidated EBITDA1
31 Dec, 31 Dec,
2008 US$ (000) 2009 US$ (000) 31 Dec. 31 Dec. Q3 - 2009 Q4 - 2009
Inc/ Inc/
Subsidiary 2008 2009 (3 months) (3 months)
Fourth quarter revenues performance improved over the previous 09 due to the summer seasonality effect which helped generate (dec) (dec)
US$ (000) US$ (000) US$ (000) US$ (000)
quarter in all major subsidiaries, with the exception of Algeria and higher revenues in Q3. Revenue was positive in Pakistan, Egypt
Tunisia. In Q4 2009, OTA witnessed a decline in traffic and network and Bangladesh with single digit increases over the previous GSM
usage resulting from the unfavourable events that took place in quarter. It is worth noting that the recent agreement signed be-
November and were partially offset by discounts and free minutes tween Ring and Nokia allowed the entity to increase its revenue Djezzy (Algeria) 1,290,062 1,067,241 (17.3%) 283,121 213,318 (24.7%)
promotions. In Tunisia, revenues were down 6.5% in Q4 09 over Q3 by 32.4% in Q4 09 compared to Q3 09. Mobilink (Pakistan) 491,664 384,781 (21.7%) 91,932 105,259 14.5%
Mobinil (Egypt) 429,683 460,457 7.2% 116,157 120,026 3.3%
Table 7: Proforma Consolidated Revenues (Local Currency)1
Tunisiana (Tunisia) 188,912 192,227 1.8% 55,223 48,137 (12.8%)
banglalink (Bangladesh) 13,683 117,238 n.m. 35,390 22,224 (37.2%)
31 Dec. 31 Dec. Inc/ Q3 - 2009 Q4 - 2009 Inc/
Subsidiary Telecel Globe (Africa) 492 (202) n.m. 3,519 (2,926)4 n.m.
20082 2009 (dec) (3 months) (3 months) (dec)
koryolink (North Korea) - 17,153 n.a. 7,188 5
7,164 (0.3%)
GSM
Total GSM 2,414,496 2,238,894 (7.3%) 592,530 513,203 (13.4%)
Djezzy (Algeria) (DZD bn) 135.0 135.6 0.4% 34.8 32.4 (6.9%)
Telecom Services
Mobilink (Pakistan) (PKR bn) 87.4 86.8 (0.7%) 21.5 22.7 5.3%
Ring (1,593) (6,791) n.m. (2,718) (1,162) 57.3%
Tunisiana (Tunisia) (TND mn) 432.2 482.3 11.6% 132.5 121.0 (8.7%)
1. Un-audited Figures.
M-Link 24,985 - n.a. - - n.a.
2. Excluding the effect of M-Link in 2008. OrasInvest 19,260 - n.a. - - n.a.
Other2 (10,116) (3,456) 65.8% 1,217 2,344 92.6%
Total Telecom Services 32,536 (10,247) n.m. (1,501) 1,182 n.m.
Internet Services (62) 10,370 n.m. 3,280 5,570 69.8%
OT Holding & Other3 (63,411) (67,079) (5.8%) (16,680) (24,091) (44.4%)
Total Consolidated 2,383,559 2,171,938 (8.9%) 577,629 495,864 (14.2%)
1. EBITDA excludes management fees which were previously treated as a cost in each subsidiary and as a revenue for the Holding.
2. Other Telecom Services Companies include in C.A.T., MedCable, Mena Cable, OT Lebanon, TWA, and OTWIMAX in 2009, and C.A.T., CHEO, OT WIMAX, MedCable,
Mena Cable, Telecel Globe and TWA in 2008
3. Other non operating companies include: Cortex, Eurasia, FPPL, Moga Holding, MinMax, OIIH, Oratel, OTCS, OT ESOP, OTFSCA, OTI Malta, OT Services Europe, OT
Oscar, OTH, OT Wireless Europe, OT Asia, Pioneers, SAWLTD, ITCL, M-link and Telecel.
4. Mainly due to an increase in staff costs related to 2008 and 2009 that took place in the fourth quarter of 2009.
5. Increased EBITDA mainly due to reallocation of the staff cost compared to H1 09 and freezing the handset sales based on NK Government requirements.
34

Consolidated EBITDA EBITDA MARGIN revision in July; in addition to the adverse events that occurred
in November 2009 as a result of the football games. The mar-
Although the cost cutting initiatives undertaken by the subsidiaries gin decline for Mobilink was mainly attributable to the increase
delivered their results in the first nine months of 2009, the nega- in network maintenance and utility expenses which are mostly
tive impact of Q4 EBITDA caused a decrease in the consolidated denominated in US$. The margin for Mobilink in Q4 was however
2,500 2,384 EBITDA margin by 190bps to reach 42.9% over the previous higher compared to what was recorded in the previous quarter,
2,172 year. GSM margin declined by 2.7% to 47.8% as a result of lower as was the margin recorded by Mobinil. OTT’s margins declined
(176,0) (43) 10 (4) margins in OTA, Mobilink and OTT resulting from the currency from Q3 to Q4 by 3.7% due to the decrease in seasonal visitor
2,000 devaluation witnessed throughout 2009. This was partially offset roaming traffic. Consequently, overall consolidated margin in Q4
by the strong increase in banglalink’s and koryolink’s margins. The 09 was 38.3%; 6.5% lower than the result delivered in the previ-
margin decline in OTA was driven by the aforementioned sales tax ous quarter. Total GSM margin in Q4 was 43.4%.
1,500 introduction, borne by the operators, and by the termination rate
Table 10: Consolidated EBITDA Margin
(8.9%)
1,000 31 Dec. 31 Dec. Q3 - 2009 Q4 - 2009
Subsidiary Change Change
2008 2009 (3 months) (3 months)

500 GSM
Djezzy (Algeria) 63.2% 57.1% (6.1%) 59.1% 47.7% (11.5%)
Mobilink (Pakistan) 40.7% 36.4% (4.4%) 35.5% 38.9% 3.4%
0 Mobinil (Egypt) 48.2% 48.8% 0.5% 47.5% 48.4% 0.9%
Total Total Total Internet OT Holding & Total Consoli-
Consolidated GSM Telecom Services Other dated 2009 Tunisiana (Tunisia) 57.9% 53.9% (4.0%) 55.4% 51.7% (3.7%)
2008 Services banglalink (Bangladesh) 4.7% 33.4% 28.7% 39.7% 24.3% (15.5%)
Telecel Globe (Africa) 1.9% (0.2%) (2.2%) 16.9% (12.4%) (29.3%)
In local currency terms, Q4 2009 performance versus Q3 was In Egypt the EBITDA increased by a mid-single digit over the
koryolink (North Korea) n.a. 66.1% n.a. 120.1%1 95.6% (24.5%)
strong in Pakistan, but was weaker in Tunisia due to the decrease previous quarter mainly due to the success of the on-net strategy
in revenue. In Algeria the Q4 EBITDA was impacted by the attacks and the applied cost optimization initiatives. In Bangladesh the Total GSM 50.5% 47.8% (2.7%) 49.5% 43.4% (6.0%)
resulting from the football games which caused interruptions to the decrease over Q3 was driven by a more aggressive marketing Total Telecom Services 6.9% (3.5%) (10.4%) (2.1%) 1.3% 3.4%
operational activities. Moreover, in order to rebuild its brand after approach to capture market share by introducing promotions and Total Internet Services (0.1%) 11.7% 11.8% 16.0% 24.4% 8.4%
the negative impact of the football game OTA incurred an increase offers that subsidized occasionally the SIM tax; a reaction to the
EBITDA Margin 44.7% 42.9% (1.9%) 44.7% 38.3% (6.5%)
in cost of sales and marketing expenses versus the previous quar- strategy adopted by certain competitors who started to re-subsi-
ter. We estimate the impact on OTA Q4 2009 EBITDA to be around dize the SIM tax. The sharp decrease in Telecel Globe EBITDA 1. Mainly due to reallocation of the staff cost compared to H1 09 and freezing the handset sales based on NK Government requirements.
US$55 million between loss of revenue opportunity, damages of was mainly due a reclassification of staff costs related to 2008
stock (SIM and scratch cards, handsets) and provision for taxes and 2009 that took place in the fourth quarter of 2009.
and around US$41 million below the EBITDA line (damage to Consequently, at the consolidated EBITDA level the fourth quarter
physical assets net of insurance and provision for Income tax). of 2009 was down by 14.2% over the previous quarter.

Table 9: Proforma Consolidated EBITDA (Local Currency)1

31 Dec. 31 Dec. Inc/ Q3 - 2009 Q4 - 2009 Inc/

Subsidiary
20082 2009 (dec) (3 months) (3 months) (dec)
GSM
Djezzy (Algeria) (DZD bn) 83.7 78.1 (6.6%) 20.83 15.7 (24.9%)
Mobilink (Pakistan) (PKR bn) 34.9 31.7 (9.2%) 7.7 8.9 16.2%
Tunisiana (Tunisia) (TND mn) 232.7 260.6 12.0% 73.6 62.5 (15.1%)
1. Un-audited Figures.
2. Excluding the effect of M-Link in 2008.
3. In Q4 09 a reclassification of expenses was carried out resulting in an increase in Djezzy’s Q3 local currency EBITDA
35

Foreign Exchange Rates Net Income line (damage to physical assets net of insurance and provision for
Income tax). The increase in Net Financing Cost in Q4 was main-
Table 11: Foreign Exchange Rates used in the Income Statement & Balance Sheet ly triggered by the decrease of foreign exchange gain compared
Net Income in 2009 decreased by 26% to US$ 318 Million mainly
driven by the loss recorded in the fourth quarter. The recent riot to Q3 09. In addition to the tax provision in Algeria of $30 million
% Chg 3 % Chg 3 events in Algeria following the football match had a negative im- out of which $20 million was made in Q4, a change in the tax
Currency Dec. 08 Sept. 09 Dec. 09 Dec. 09 vs Dec. 09 vs pact on the operations. We estimate the impact on OTA Q4 2009 law in Pakistan, where a minimum tax of 0.5% of revenues was
Dec. 08 Sept. 09 EBITDA to be around US$55 million between loss of revenue op- implemented and accounted for in Q4 09. EPS in the 12 months
portunity, damages of stock (SIM and scratch cards, handsets) and ended December 31, 2009 reached US$1.81/GDR.
Egyptian Pound/USD
provision for taxes and around US$41 million below the EBITDA
Income Statement1 5.4735 5.6084 5.5804 (1.9) 0.5
Table 12: Income Statement in IFRS/US$
Balance Sheet 2
5.5340 5.5250 5.5096 0.4 0.3
Algerian Dinar/USD 31 Dec. 31 Dec. Q3 - 2009 Q4 - 2009
Inc/ Inc/
Income Statement1 64.5161 72.6195 72.4638 (11.0) 0.2 2008 2009 (3 months) (3 months)
(dec) (dec)
Balance Sheet2 70.9220 72.4466 72.4638 (2.1) (0.0) US$ (000) US$ (000) US$ (000) US$ (000)
Tunisian Dinar/USD Revenues 5,326,549 5,064,790 (5%) 1,291,098 1,295,516 0%
Income Statement1 1.2302 1.3708 1.3521 (9.0) 1.4 Other Income 41,257 30,978 6,840 7,977
Balance Sheet2 1.3137 1.2974 1.3173 (0.3) (1.5) Total Expense (2,984,247) (2,910,771) (720,310) (794,571)
Pakistan Rupee/USD Net unusual Items - (13,059) - (13,059)
Income Statement 1
70.9220 81.3647 81.9672 (13.5) (0.7) Restructuring costs - - - -
Balance Sheet2 78.7402 83.1200 84.0336 (6.3) (1.1) EBITDA1 2,383,559 2,171,938 (9%) 577,628 495,864 (14%)
Bangladeshi Taka/USD Depreciation & Amortization (912,173) (984,067) (248,935) (253,694)
Income Statement1 69.4444 69.4289 69.4444 0.0 (0.0) Impairment of Non Current Assets (39,464) (38,296) (7,243) (15,223)2
Balance Sheet 2
69.4444 69.4200 69.4444 0.0 (0.0) Gain (Loss) on Disposal of Non Current Assets 66,315 41,638 (424) 6,302
Canadian Dollar/USD Net unusual Items - (15,117) - (15,117)
Income Statement1 1.1266 1.1478 1.1211 0.5 2.4 Operating Income 1,498,237 1,176,096 (22%) 321,026 218,132 (32%)
Balance Sheet2 1.2042 1.0628 1.0386 15.9 2.3 Financial Expense (468,453) (511,332) (118,948) (130,511)
1- Represents the average monthly exchange rate from the start of the year until the end of the period. Financial Income 53,110 95,528 3 13,687 64
2- Represents the spot exchange rate at the end of the period.
3- Appreciation/(Depreciation) of Local Currency vs. USD.
Foreign Exchange Gain (Loss) (201,083) 4
27,1414 77,8784 14,9934
Net Financing Cost (616,426) (388,663) (27,383) (115,454)
Net unusual financial items - - - -
Share of Profit (Loss) of Associates (2,955) (47,129) (9,804) (26,156)
Gain on Disposal of Associates 27,262 - - -
Profit Before Tax 906,118 740,304 (18%) 283,839 76,522 (73%)
Income Tax (403,494) (360,832) (84,490) (110,383)
Profit from Continuing Operations 502,624 379,472 (25%) 199,349 (33,861) n.m.
Profit for the Period 502,624 379,472 (25%) 199,349 (33,861) n.m.
Attributable to:
Equity Holders of the Parent5 430,822 318,134 (26%) 180,942 (46,390) n.m.
Earnings Per Share (US$/GDR) 2.30 1.81 6
(21%) 1.03 (0.26) n.m.
Minority Interest 71,802 61,338 18,406 12,529
Net Income 502,624 379,472 (25%) 199,348 (33,861) n.m.
1- Management Presentation developed from IFRS financials.
2- Mainly due to the impairment of goodwill in PMCL’s ISP subsidiary amounting to approx. US$ 7 million.
3- Mainly due to gains of approx. US$ 36.5 million resulting from the early extinguishment of PMCL’s bond.
4- Due to appreciation of Canadian Dollar and depreciation of US$ in 2009 vs.2008.
5- Equates to Net Income after Minority Interest.
6- Based on a weighted average for the outstanding number of shares of 175,686,958 GDRs.
36

Table 13: Balance Sheet in IFRS/US$ Table 14: Cash Flow Statement in US$

IFRS/US$ IFRS/US$ IFRS/US$ IFRS/US$

31 December 31 December 31 December 31 December
2008 2009 2008 2009
US$ (000) US$ (000) US$ (000) US$ (000)
Assets Cash Flows from Operating Activities
Property and Equipment (net) 5,052,5741 5,031,757 Profit for the Period 502,624 379,472
Intangible Assets 2,383,5721 2,261,477 Depreciation, Amortization & Impairment of Non-Current Assets 951,637 1,022,363
Other Non-Current Assets 727,436 963,990 Income Tax Expense 403,494 360,832
Total Non-Current Assets 8,163,582 8,257,224 Net Financial Charges 415,343 415,805
Cash and Cash Equivalents 651,783 759,546 Share of Loss (Profit) of Associates Accounted for Using the Equity Method 2,955 47,129
Trade Receivables 327,638 331,759 Other 96,250 (27,011)
Assets Held for Sale 80,4712 109,953 Changes in Assets Carried as Working Capital (152,127) (170,678)
Other Current Assets 705,409 640,537 Changes in Other Liabilities Carried as Working Capital 111,808 252,577
Total Current Assets 1,765,301 1,841,795 Income Tax Paid (480,807) (621,940)
Total Assets 9,928,883 10,099,019 Interest Expense Paid (428,447) (472,260)
Equity Attributable to Equity Holders of the Company 1,080,2303 1,275,765 Net Cash Generated by Operating Activities 1,422,731 1,186,290
Minority Share 120,994 140,029
Total Equity 1,201,224 1,415,794 Cash Flows from Investing Activities
Liabilities Cash Outflow for Investments in Property & Equipment, Intangible Assets, and Financial Assets
(1,745,442) (1,327,136)
Long Term Debt 5,205,030 4,873,991 & Consolidated Subsidiaries
Net (Payments) for Current Financial Assets - (40,762)
Other Non-Current Liabilities 523,8031 340,145
Proceeds from Disposal of Property & Equipment, Associates, Subsidiaries and Financial Assets 2,087,121 250,767
Total Non-Current Liabilities 5,728,833 5,214,136
Advances & Loans made to Associates & other parties (441,910) (135,237)
Short Term Debt 530,315 998,231
Dividends & Interest Received 34,392 32,171
Trade Payables 1,186,051 1,042,907
Other Current Liabilities 1,282,460 1,427,951 Net Cash Used in Investing Activities (65,839) (1,220,197)

Total Current Liabilities 2,998,826 3,469,089

Total Liabilities 8,727,659 8,683,225 Cash Flows from Financing Activities
Total Liabilities & Shareholder’s Equity 9,928,883 10,099,019 Proceeds from Non-Current Borrowings 2,522,216 848,314
Net Debt4 5,083,562 5,112,676 Repayment of Non-Current Borrowings (1,975,760) (802,073)

1- In accordance to the IFRS-3 a reclassification was done on December 2008 balances as a result of the finalization of the purchase price allocation of Telecel Globe which
Net Proceeds (Payments) from Current Financial Liabilities (56,633) 164,611
covers the acquisition of Burundi and CAR. Net Change in Cash Collateral (76,872) 83,125
2- Includes M-Link.
3- Reflects the purchase of approximately 29.3 million GDRs of treasury shares in 2008. Dividend Payments (165,977) (91,160)
4- Net Debt is calculated as a sum of Short Term Debt, Long Term Debt, less Cash and Cash Equivalents.
Proceeds / Payments for Treasury Shares (2,086,224) (4,189)
Change in Minority Interest (62,563) (34,548)
Net Cash generated by (Used in) Financing Activities (1,901,812) 164,080
Net Increase (Decrease) in Cash & Cash Equivalents (544,920) 130,173
Cash included in Assets Held for Sale (7,804) (12,561)
Effect of Exchange Rate Changes on Cash & Cash Equivalents (34,060) (9,849)
Cash & Cash Equivalents at the Beginning of the Period 1,238,568 651,783
Cash & Cash Equivalents at the End of the Period 651,783 759,546
37

Table 15: Income Statement in EAS/Egyptian Pounds Table 16: Balance Sheet in EAS/Egyptian Pounds1

Inc/ Inc/ EAS/LE EAS/LE

31 Dec. 31 Dec. (dec) Q3 - 2009 Q4 - 2009 (dec)
2008 2009 (3 months) (3 months) 31 December 31 December
LE (000) LE (000) LE (000) LE (000) 2008 2009
LE (000) LE (000)
Revenues 29,153,310 28,261,946 (3%) 7,185,568 7,122,189 (1%) Assets
Other Income 225,805 172,837 37,991 43,854 Property and Equipment (net) 27,907,419 27,526,242
Total Expense (16,255,932) (16,178,907) (4,013,452) (4,369,574) Intangible Assets 12,996,658 12,262,066
Net unusual Items - (72,869) - (72,869) Other Non-Current Assets 4,026,358 5,310,618
Restructuring costs - - - - Total Non-Current Assets 44,930,435 45,098,927
EBITDA1 13,123,183 12,183,007 (7%) 3,210,107 2,723,600 (15%) Cash and Cash Equivalents 3,607,620 4,184,340
Depreciation & Amortization (4,980,805) (5,477,033) (1,381,819) (1,389,623) Trade Receivables 1,813,478 1,827,658
Other 146,959 (65,702) (43,446) (134,484) Assets Held for Sale 445,408 605,732
Operating Income 8,289,337 6,640,272 (20%) 1,784,842 1,199,493 (33%) Other Current Assets 3,912,554 3,570,237
Financial Expense (2,562,366) (2,851,808) (660,763) (717,118) Total Current Assets 9,779,060 10,187,968
Financial Income 291,000 533,056 74,931 (2,346) Total Assets 54,709,495 55,286,895
Foreign Exchange Gain (Loss) (1,101,000) 151,449 438,245 83,316 Equity Attributable to Equity Holders of the Company 5,791,788 6,806,645
Net Financing Cost (3,372,366) (2,167,303) (147,587) (636,148) Minority Share 632,979 762,697
Net unusual financial items - - - - Total Equity 6,424,767 7,569,342
Share of Profit (Loss) of Associates (16,171) (262,986) (54,735) (145,357) Liabilities
Gain on Disposal of Associates 149,211 - - - Long Term Debt 28,794,164 26,747,498
Profit Before Tax 5,050,011 4,209,983 (17%) 1,582,520 417,988 (74%) Other Non-Current Liabilities 2,899,244 1,886,011
Income Tax (2,208,409) (2,013,471) (470,144) (608,846) Total Non-Current Liabilities 31,693,408 28,633,509
Profit from Continuing Operations 2,841,602 2,196,512 (23%) 1,112,376 (190,858) n.m. Short Term Debt 2,929,972 5,483,389
Gains or losses from discontinued Trade Payables 6,567,076 5,745,373
- - - -
operations
Other Current Liabilities 7,094,272 7,855,282
Profit for the Period 2,841,602 2,196,512 (23%) 1,112,376 (190,858) n.m.
Total Current Liabilities 16,591,320 19,084,044
Attributable to:
Total Liabilities 48,284,728 47,717,553
Equity Holders of the Parent 2,463,594 1,845,289 (25%) 1,010,089 (262,284) n.m.
Total Liabilities & Shareholder’s Equity 54,709,495 55,286,895
Earnings Per Share (EGP) 2.63 2.10 2% 1.1485997 (0.30) n.m.
Net Debt2 28,116,516 28,046,547
Minority Interest 378,389 351,223 102,286 71,426
1- Management presentation developed from EAS financials.
Net Income 2,841,602 2,196,512 (23%) 1,112,376 (190,858) n.m. 2- Net Debt is calculated as a sum of Short Term Debt, Long Term Debt, less Cash and Cash Equivalents.

1- Management Presentation developed from EAS financials

38

Table 17: Ownership Structure & Consolidation Methods Appendix 1

Ownership Glossary is applied for OTA, Mobilink, Mobinil and banglalink so far. OTT
Subsidiary Consolidation Method customers are considered churn if they do not recharge within
December 31
December 31 ARPU (Average Revenue per User): 90 days after the validity of the scratch card; while a koryolink
2008 2009 2008 2009 Average monthly recurrent revenue per customer (excluding visi- customer is considered churn if he/she does not recharge within
GSM Operations tors roaming revenue and connection fee). This includes airtime four months after the validity of the scratch card.
Proportionate Proportionate revenue (national and international), as well as, monthly subscrip-
Mobinil (Egypt)1 28.75% 28.75% tion fee, SMS, GPRS & data revenue. Quarterly ARPU is calcu- MOU (Minutes of Usage):
Consolidation Consolidation
Proportionate Proportionate lated as an average of the last three months. Average airtime minutes per customer per month. This includes
Egyptian Co. for Mobile Services 20.00% 20.00%
Consolidation Consolidation billable national & international outgoing traffic originated by
IWCPL (Pakistan) 100.00% 100.00% Full Consolidation Full Consolidation Capex: subscribers (on-net, to land line & to other operators). Also, this
Orascom Telecom Algeria 2
96.81% 96.81% Full Consolidation Full Consolidation Tangible & Intangible fixed assets additions during the reporting includes incoming traffic to subscribers from land line or other
period, includes work in progress, network, IT, and other tangible operators.
Telecel (Africa) 100.00% 100.00% Full Consolidation Full Consolidation and intangible fixed assets additions but excludes license fees.
Proportionate Proportionate OTH’s Market Share Calculation Method:
Orascom Telecom Tunisia3 50.00% 50.00%
Consolidation Consolidation Churn: The market share is calculated through the data warehouse of
Telecel Globe 100.00% 94.00% Full Consolidation Full Consolidation Disconnection rate. This is calculated as the number of disconnec- OTH’s subsidiaries. The number of SIM cards of competitors that
OT Ventures 4
100.00% 100.00% Full Consolidation Full Consolidation tions during a month divided by the average customer base for that appeared in the call detail record of each of OTH’s subsidiaries is
month. collected. This reflects the number of subscribers of the competi-
CHEO 75.00% 75.00% Full Consolidation Full Consolidation
tion. However, OTH deducts the number of SIM cards that did not
Internet Service Churn Rule: appear in the call detail records for the last 90 days to account
Intouch 100.00% 100.00% Full Consolidation Full Consolidation A subscriber is considered churned (removed from the subscriber for churn. The same is applied to OTH subsidiaries. This method
base) if he exceeds the 90 days from the end of the validity period is used to calculate the market shares of Djezzy, Mobinil, and
Non GSM Operations
without recharging. It is worth noting that the validity period is a Tunisiana only. In Pakistan and Bangladesh, Market share as an-
Ring 99.00% 99.00% Full Consolidation Full Consolidation function of the scratch denomination. In cases where scratch cards nounced by the Regulators is based on disclosed information by
Orasinvest 100.00% - Full Consolidation - have open validity, the subscriber is considered churned in case he the other operators which may use different subscriber recogni-
has not made a single billable event in the last 90 days (i.e. outgo- tion policy
OTCS 100.00% 100.00% Full Consolidation Full Consolidation
ing or incoming call or sms, wap session…). Open cards validity
OT ESOP 100.00% 100.00% Full Consolidation Full Consolidation
M-Link 100.00% 100.00% Full Consolidation Full Consolidation
OT Services Europe 100.00% 100.00% Full Consolidation Full Consolidation
MedCable 100.00% 100.00% Full Consolidation Full Consolidation
Mena Cable 99.97% 100.00% Full Consolidation Full Consolidation
Moga Holding 100.00% 100.00% Full Consolidation Full Consolidation
Oratel 100.00% 100.00% Full Consolidation Full Consolidation
Proportionate Proportionate
C.A.T.5 50.00% 50.00%
Consolidation Consolidation
OT Wireless Europe 100.00% 100.00% Full Consolidation Full Consolidation
OT WIMAX 100.00% 100.00% Full Consolidation Full Consolidation
TWA 51.00% 51.00% Full Consolidation Full Consolidation
OIIH6 100.00% 100.00% Full Consolidation Full Consolidation
OT Holding 100.00% 100.00% Full Consolidation Full Consolidation
FPPL 100.00% 100.00% Full Consolidation Full Consolidation
MinMax Ventures 100.00% 100.00% Full Consolidation Full Consolidation
OIH 100.00% 100.00% Full Consolidation Full Consolidation
OTFCSA 100.00% 100.00% Full Consolidation Full Consolidation
OT Holding Canada 7
100.00% 100.00% Full Consolidation Full Consolidation
Proportionate Proportionate
ITCL 50.00% 50.00%
Consolidation Consolidation
SAWLTD 100.00% 100.00% Full Consolidation Full Consolidation

1- Mobinil is a holding company which controls 51% of ECMS, the mobile operator. Mobinil is also the brand name used by ECMS.
2- Direct and Indirect stake through Moga Holding Ltd. and Oratel.
3- Orascom Telecom Tunisia is proportionately consolidated through Orascom Tunisia Holding and Carthage Consortium.
4- OT Ventures owns 100% of Sheba Telecom which operates under the trade name banglalink.
5- Direct and Indirect stake through International Telecommunications Consortium Limited (ITCL).
6- OIH owns 100% of Orascom Telecom Iraq which sold Iraqna in December 2007.
7- Holding company for OTH’s Share in Globalive which has been accounted for under the equity method.
39
Consolidated financial
statements and auditor’s report
(in IFRS/US$)
• Consolidated Balance Sheet
• Consolidated Income Statement
• Consolidated Statement of Comprehensive Income
• Consolidated Statement of Changes in Equity
•
•
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
• Appendix A - Liabilities to Banks
• Appendix B - Bonds
• Appendix C - Scope of Consolidation
Independent auditor’s report
To the board of directors of Orascom Telecom Holding (S.A.E)
We have audited the accompanying consolidated financial statements of Orascom Telecom Holding (S.A.E), which comprise
the consolidated balance sheet as at 31 December 2009, and the consolidated income statement, consolidated statement of
comprehensive income, consolidated statement of changes in equity and consolidated cash flow statement for the year then
ended, and a summary of significant accounting policies and other explanatory notes.
Management’s responsibility for the financial statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with
International Financial Reporting Standards. This responsibility includes: designing, implementing and maintaining internal control
relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to
fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in
the circumstances.
Auditor’s responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit
in accordance with International Standards on Auditing. Those Standards require that we comply with ethical requirements and
plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material
misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements
in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of
the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Orascom
Telecom Holding (S.A.E) as at 31 December 2009, and of its financial performance and its cash flows for the year then ended in
accordance with International Financial Reporting Standards.
Emphasis of a matter
Without qualifying our opinion, we draw attention to note (35) “Contingent assets and liabilities” for the following:
1- Some subsidiaries received tax assessment from the tax authorities in the territories in which they operate. Management
believes that these assessments are excessive, and intends to challenge the assessments through the proper legal channels.
Currently, the management of these subsidiaries
cannot make reliable estimate of tax exposures.
2-   Egyptian Company for Mobile Services (ECMS) “Jointly controlled entity” filed a lawsuit against the National Telecommunication
Regulatory Authority (NTRA) to cancel NTRA’s decision relating to the amendments of the interconnect prices between the
fixed and mobile networks. The Company and its external legal counselor believe that the possibility of winning the lawsuit
is probable as NTRA’s decision does not have legal or contractual ground, therefore the Company continued to recognize
interconnect revenue and cost from and to Telecom Egypt based on the existing agreement.
Cairo, 15 March, 2010 KPMG Hazem Hassan
40

Consolidated Balance Sheet Consolidated Income Statement

As of December 31, For the year ended December 31

(in million of US$) Note  2009 2008 (in million of US$) Note  2009 2008
 
Revenues 7 5,065 5,327
Assets  
Property and equipment 18 5,032 5,053 Other income 31 41
Intangible assets 19 2,261 2,383 Purchases and services 8 (2,364) (2,511)
Other non-current financial assets 20 845 639 Other expenses 9 (215) (174)
Deferred tax assets 21 119 88
Personnel costs 10 (332) (299)
Total non-current assets 8,257 8,163
Net unusual inventory loss 13 (13) -
 
Inventories 55 106 Depreciation and amortization 11 (984) (912)
Trade receivables 22 332 328 Impairment charges 12 (39) (39)
Other current financial assets 20 114 277 Net unusual capital loss 13 (15) -
Current income tax receivables 17 100 75
Disposal of non current assets 14 42 66
Other current assets 23 371 247
Cash and cash equivalents 24 760 652 Operating income 1,176 1,499
Assets held for sale 6 110 80 Financial income 15 95 52
Total current assets 1,842 1,765 Financial expense 15 (511) (468)
Total assets 10,099 9,928 Foreign exchange gain /(loss) 15 27 (201)
 
Net financing costs (389) (617)
Equity and liabilities  
Share capital 258 261
Reserves (214) (329) Share of loss of associates 16 (47) (3)
Retained earnings 1,232 1,148 Gain on disposal of associates 16 - 27
Equity attributable to owners of the Company 1,276 1,080 Profit before income tax 740 906
  Income tax expense 17 (361) (403)
Non-controlling interest 140 121
Profit for the year 379 503
Total equity 25 1,416 1,201
  Attributable to:  
Liabilities  
Owners of the Company 318 431
Non-current borrowings 26 4,874 5,205
Other non-current liabilities 27 121 220 Non-controlling interest 61 72
Provisions 4 3 379 503
Non-current income tax liabilities 17 - 43 Basic and diluted earnings per share - (US$) 29 0.36 0.46
Deferred tax liabilities 21 216 257
(The notes from (1) to (37) are an integral part of these consolidated financial statements)
Total non-current liabilities 5,215 5,728
 
Current borrowings 26 998 530
Trade payables 28 1,043 1,186
Other current liabilities 27 1,091 856
Current income tax liabilities 17 187 341
Provisions 94 61
Liabilities held for sale 6 55 25
Total current liabilities 3,468 2,999
Total liabilities 8,683 8,727
Total equity and liabilities 10,099 9,928
(The notes from (1) to (37) are an integral part of these consolidated financial statements)

Group CFO Chief Executive Officer Executive Chairman

Aldo Mareuse Khaled Bichara Naguib Onsi Sawiris Auditor’s report ‘attached’


41

Consolidated Statement of Comprehensive Income Consolidated Statement of Changes in Equity

For the year ended December 31, 2009 2008 Attributable to owners of the Company
(in million of US$)     (in million of US$) Non
Share Treasury Other Retained Total
Total controlling
capital shares reserves earnings equity
Interest
Profit for the year 379 503
Other comprehensive income:   As of January 1, 2009 261 (190) (139) 1,148 1,080 121 1,201
Changes in fair value of available-for-sale financial assets (2) (2)    
Comprehensive income
Cash flow hedges, net of tax 25 (88) - - - 318 318 61 379
Profit for the year
Currency translation differences (46) (176) - - (26) - (26) 3 (23)
Other comprehensive income
Share of profit recognized directly in equity of associates - 5
Total comprehensive income - - (26) 318 292 64 356
Other comprehensive income for the year, net of tax (23) (261)
Transactions with owners    
Total comprehensive income for the year 356 242
Change in non controlling - - - -  - (10) (10)
  interest
Attributable to:   Dividends - 56 10 (160) (94) (35) (129)
Owners of the Company 292 173 Share based compensation - 5 (3) 2 - 2
Non-controlling interest 64 69 Cancellation of shares (3) 92 (15) (74) - - -
(The notes from (1) to (37) are an integral part of these consolidated financial statements) Purchase of treasury shares - (38) - - (38) - (38)
Sale of treasury shares - 27 7 - 34 - 34
Total transactions with owners (3) 142 (1) (234) (96) (45) (141)
As of December 31, 2009 258 (48) (166) 1,232 1,276 140 1,416

Attributable to owners of the Company

Non
Share Treasury Other Retained Total
(in million of US$) Total controlling
capital shares reserves earnings equity
interest
   
As of January 1, 2008 316 (892) 212 3,513 3,149 93 3,242
Comprehensive income
Profit for the year - - - 431 431 72 503
Other comprehensive income - - (258) - (258) (3) (261)
Total comprehensive income - - (258) 431 173 69 242
Transactions with owners
Dividends - - (9) (157) (166) (61) (227)
Share based compensation - - 11 - 11 - 11
Cancellation of shares (55) 2,789 (79) (2,655) - - -
Purchase of treasury shares - (2,202) - - (2,202) - (2,202)
Sale of treasury shares - 115 - - 115 - 115
Capital increase non-controlling
- - - - - 20 20
interest
Reclassifications - - (16) 16 - - -
Total transactions with owners (55) 702 (93) (2,796) (2,242) (41) (2,283)
As of December 31, 2008 261 (190) (139) 1,148 1,080 121 1,201
(The notes from (1) to (37) are an integral part of these consolidated financial statements)
42

Consolidated Statement of Cash Flows

For the year ended December 31, 1- General information • IFRS 8,“Operating segments”, IFRS 8 replaces IAS
Note 2009 2008 14, “Segment reporting” and requires a “management
(in millions of US$)
Orascom Telecom Holding S.A.E. (the “Company”) is a joint approach” under which segment information is
Profit for the year 379 503
stock company with its head office in Cairo, Egypt. The presented on the same basis as that used for internal
Adjustments for:   Company, through its subsidiaries (together the “Group”) is a reporting purposes. This has resulted in an increase
Depreciation, amortization and impairment charges 1,023 951 leading mobile telecommunications company operating in high in the number of operating segments reported, as a
Net unusual inventory loss and capital loss 28 - growth emerging markets in the Middle East, Africa and Asia, result of the adoption of IFRS 8 we now present our
Income tax expense 361 403 having a total population under license of approximately 510 segment reporting using a geographical analysis.
Share-based compensation 12 11 million. The Company is a subsidiary of Weather Investments Goodwill is allocated by management to groups
Net financial charges 416 416 S.p.A. (“Weather Investments” or the “Parent Company”). of cash generating units on a segment level. The
The Company is listed on the Egyptian Stock Exchange and change in reportable segments has not resulted in
Unrealized foreign exchange difference (43) 143
has Global Depository Receipts (“GDR”) listed on the London any additional goodwill impairment. The comparative
loss on disposal of non-current assets 2 2 Stock Exchange. information for 2008 has been restated.
Gain from sale of subsidiaries and financial assets (44) (68)
Share of loss of associates 47 3 These consolidated financial statements as of and for the The Group has also adopted the following new and amended
Gain on disposal of associates - (27) year ended December 31, 2009 (the “Consolidated Financial IFRSs and IFRIC Interpretations with no material impact:
Change in assets carried as working capital (197) (152) Statements”) were approved for issue by the Board of • IFRS 7(amendment), “Financial instruments –
Change in provisions and allowances 73 35 Directors on March 15, 2010. Disclosures” – which requires additional disclosures
Change in other liabilities carried as working capital 223 112 about fair value measurement and liquidity risk.
2- Significant accounting policies • Amendment to IFRS 2 “Share-based Payment”
Income tax paid (622) (481)
2.1 Basis of presentation relating to vesting conditions and cancellations.
Interest expense paid (472) (428) • Revised IAS 23 “Borrowing Costs” relating to
The Consolidated Financial Statements of the Group, as capitalization of borrowing costs and IAS 23
Net cash generated by operating activities 1,186 1,423 of and for the year ended December 31, 2009, have been (amendment) relating to the calculation of borrowing
prepared in accordance with International Financial Reporting costs.
Net cash outflow for investments in: Standards (IFRS) and its interpretations as adopted by • IFRIC 16 “Hedges of a Net Investment in a Foreign
- Property and equipment (1,103) (1,474) the International Accounting Standards Board (IASB) and Operation” relating to guidance on the accounting for
all interpretations of the International Financial Reporting hedges of a net investment in foreign operations.
- Intangible assets (118) (146)
Interpretations Committee (IFRIC) and all interpretations of • IFRIC 18 “Transfers of Assets From Customers”
- Financial assets and associates (76) (20) the Standing Interpretations Committee (SIC). relating to treatment of items of property, plant and
- Consolidated subsidiaries (30) (103) equipment or cash to acquire or construct such
Net proceeds from disposals of: The consolidated financial statements have been prepared assets received from customers.
- Property and equipment 35 11 under the historical cost basis except for the following: • IAS 1 (amendment) “Presentation of financial
• derivative financial instruments are measured statements”, relating to the classification of financial
-Subsidiaries 216 69
at fair value; assets and liabilities held for trading.
-Associates - 956 • financial instruments at fair value through
-Financial assets - 1,049 • IAS 28 (amendment), “Investments in associates,”
profit or loss are measured at fair value; and and consequential amendments to IAS 32, “Financial
Net investments in financial assets held for trading (41) - • available-for-sale financial assets are Instruments: Presentation” and IFRS 7, “Financial
Advances and loans made to associate and other parties (37) (135) (442) measured at fair value. instruments: Disclosures” relating to impairment
Dividends and interest received 32 34 testing of investments.
For presentational purposes, the current/non-current • IAS 36 (amendment), “Impairment of assets” relating
distinction has been used for the balance sheet, while to impairment testing disclosures.
Net cash (used in) investing activities (1,220) (66)
expenses are analyzed in the income statement using a • IFRIC 13, “Customer loyalty programmes” relating
classification based on their nature. The indirect method has to calculating the fair value of customer loyalty
Proceeds from non-current borrowings 848 2,522 been selected to present the cash flow statement. programmes.
Repayment of non-current borrowings (802) (1,976)
Net proceeds/(payments) from Current financial liabilities 165 (57) The information presented in this document has been 3.3 Summary of main accounting principles and
Net change in cash collateral 83 (77) presented in millions of United States Dollar (US$”), except policies
Dividend payments (91) (166) earnings per share and unless otherwise stated.
Net (payments) for treasury shares (5) (2,086) The main accounting principles and policies adopted in
2.2 Change in Accounting Polices preparing these Consolidated Financial Statements are set
Change in non-controlling interest (35) (61)
our below. These policies have been consistently applied to
The Group has adopted the following new and amended all periods in those consolidated financial statements, and
Net cash generated by / (used in) financing activities 163 (1,901) IFRSs as of January 1, 2009: have been applied consistently by the group entities.
  • IAS1 (revised), “Presentation of financial statements”.
Net increase/(decrease) in cash and cash equivalents 129 (544) The revised standard prohibits the presentation of Basis of consolidation
items of income and expense (“non-owner changes
in equity”) in the statement of changes in equity. The Consolidated Financial Statements include the financial
Cash included in assets held for sale (14) (8) statements of the Company and those entities over which the
“Non-owner” changes in equity are presented in
Effect of exchange rate changes on cash and cash equivalents (7) (35) Company exercises control, both directly or indirectly, from
the statement of comprehensive income. Entities
can choose whether to present one performance the date of acquisition to the date when such control ceases.
Cash and cash equivalents at the beginning of the year 652 1,239 statement (the statement of comprehensive income) Control may be exercised through direct or indirect ownership
Cash and cash equivalents at the end of the year 760 652 or two statements (the income statement and of shares with majority voting rights, or by exercising a
statement of comprehensive income). The Group dominant influence expressed as the direct or indirect power,
has elected to present two statements: an income based on contractual agreements or statutory provisions, to
(The notes from (1) to (37) are an integral part of these consolidated financial statements) determine the financial and operational policies of the entity
statement and a statement of comprehensive
income. Comparative information has also been and obtain the related benefits, regardless of any equity
represented so that it is in conformity with the new relationships. The existence of potential voting rights that are
standard. exercisable or convertible at the balance sheet date is also
considered when determining whether there is control or not.
43
The financial statements used in the consolidation process are
those prepared by the individual Group entities as of and for the
year ended December 31, 2009 (the reporting date for these
Consolidated Financial Statements) in accordance with IFRS used
by the Company in preparing these statements and approved by
the respective Boards of Directors.
The consolidation procedures used are as follows:
· the assets and liabilities and income and expenses of
consolidated subsidiaries are included on a line-by-
line basis, allocating to non-controlling interests, where
applicable, the share of equity and profit or loss for the
year that is attributable to them. The resulting balances
are presented separately in consolidated equity and the
consolidated income statement;
· the purchase method of accounting is used to account for
business combinations in which the control of an entity
is acquired. The cost of an acquisition is measured as
the fair value of the assets acquired, liabilities incurred
or assumed and equity instruments issued at the
acquisition date, plus all other costs directly attributable
to the acquisition. The excess of the cost of acquisition
over the fair value of the assets, liabilities and contingent
liabilities acquired is recorded as goodwill. If the cost of
acquisition is less than the fair value of the net assets
of the subsidiary acquired, the difference is recognized
immediately in the income statement;
· business combinations in which all of the combining
entities or businesses are ultimately controlled by the
same party or parties both before and after the business
combination are considered business combinations
involving entities under common control. In the absence
of an accounting standard guiding the accounting
treatment of these operations the Group applies IAS 8,
consolidating the book values of the entity transferred and
reporting any gains arising from the transfer in goodwill;
· the purchase of equity holdings from non-controlling
holders in entities where control is already exercised is
considered a purchase. Therefore the difference between
the cost incurred for the acquisition and the respective
share of the accounting equity acquired is recognized in
goodwill;
· any options to purchase non-controlling interests
outstanding at the end of the year are treated as exercised
and are reported as a financial liability or in equity
depending on whether the transaction is to be settled in
cash or through the exchange of equity instruments;
· unrealized gains and losses on transactions carried out
between companies consolidated on a line-by-line basis
and the respective tax effects are eliminated if material,
as are corresponding balances for receivables and
payables, income and expense, and finance income and
expense;
· gains and losses arising from the sale of holdings in
consolidated entities are recognized in the income
statement as the difference between the selling price and
the corresponding portion of consolidated equity sold.
Associates
Investments in companies where the Group exercises a significant
influence (hereafter “associates”), which is presumed to exist when
the Group holds between 20% and 50%, are accounted for using
the equity method.
The equity method is as follows:
• the Group’s share of the profit or loss of an investee is
recognized in the income statement from the date when
significant influence or control begins up to the date when
that significant influence or control ceases. Investments
in associates with negative shareholders’ equity are
impaired and a provision for its losses is accrued only if
the Group has a legal or constructive obligation to cover
such losses. Equity changes in investees accounted for
using the equity method that do not result from profit
or loss are recognized directly in consolidated equity
reserves;
• unrealized gains and losses generated from transactions
between the Company or its subsidiaries and its investees
accounted for using the equity method are eliminated
on consolidation for the portion pertaining to the Group;
unrealized losses are eliminated unless they represent an
impairment.
• The license of the Group’s associated undertaking in
Canada, Globalive Wireless Management Corp, are
indefinite lived assets. Although the spectrum licenses
have an initial term of 10 years, based on available
information, the management believes that they are
subject to perfunctory renewal and that renewal cost
will not be significant. Accordingly, they are not subject
to amortization but are tested annually for impairment,
or when indicators exist that the carrying value is not
recoverable.
Joint ventures
Joint ventures are those entities over whose activities the Group
has joint control, established by contractual agreement and
requiring unanimous consent for strategic financial and operating
decisions.
Interests in joint ventures are consolidated using the proportionate
method under which the assets and liabilities and income and
expenses of the joint venture are consolidated on a line-by-line
basis in proportion to the share held by the Group in the venture.
The carrying amount of the consolidated investment is then
eliminated against the respective portion of equity. Transactions,
balances and any unrealized gains and losses on intercompany
transactions are proportionately eliminated.
Unrealised gains arising from transactions with associates (and
jointly controlled entities) are eliminated to the extent of the
Group’s interest in the enterprise. Unrealised gains resulting from
transactions with associates and joint ventures are eliminated
against the investment in the associates or joint venture.
Appendix C includes a list of the entities included in the scope of
consolidation.
Foreign currency translation
Functional and presentation currency
The functional currency of each subsidiary is the local currency
where that entity operates. In order to present financial information
to international investors the Group’s presentation currency is US$.
Transactions and balances
Transactions in foreign currencies are translated into the functional
currency of the relevant entity at the exchange rate prevailing at the
date of the transaction. Monetary assets and liabilities denominated
in foreign currencies are translated, at the balance sheet date, into the
prevailing exchange rates at that date. Foreign currency exchange
differences arising on the settlement of transactions and the translation
of the balance sheet are recognized in the income statement.
Group companies
The useful lives estimated by the Group for the various categories
The financial statements of the Group entities are translated into of property and equipment are as follows.
the presentation currency as follows: Number of years
• assets and liabilities are translated at the closing Buildings 50
exchange rate;
Cell Sites 8-15
• income and expenses are translated at the average
Tools 5-10
exchange rate for the year;
• all resulting exchange differences are recognized as a Computer equipment 3-5
separate component of equity in the “translation reserve”; Furniture and Fixtures 5-10
Vehicles 3-6
• goodwill and fair value adjustments arising on the
Leasehold improvements and renovations 3-8
acquisition of a foreign entity are treated as assets and
liabilities of the foreign entity and are translated at the
Gains or losses arising from the sale or retirement of assets are
closing exchange rate; and
determined as the difference between the net disposal proceeds
• in the preparation of the consolidated cash flow statement,
and the net carrying amount of the asset sold or retired and are
the cash flows of foreign subsidiaries are translated at the
recognized in the income statement in the period incurred under
average exchange rate for the year.
“Disposal of non-current assets”.
The exchange rates applied in relation to the US$ are as follows:
Finance leases are leases that substantially transfer all the risks
Average for and rewards incidental to the ownership of assets to the Group.
Closing rate as
year ended Property and equipment acquired under finance lease are
of December 31,
December 31, recognized as assets at their fair value or, if lower, at the present
2009 2008 2009 2008 value of the minimum lease payments, including any amounts
to be paid for exercising a purchase option. The corresponding
0.1792 0.1827 0.1815 0.1807 liability due to the lessor is recognized as part of financial liabilities.
Egyptian Pound (LE)
An asset acquired under a finance lease is depreciated over the
0.0138 0.0155 0.0137 0.0141
Algerian Dinar (DZD) shorter of the lease term and its useful life.
0.7395 0.8129 0.7591 0.7612
Tunisian (TND)
Lease arrangements in which the lessor substantially retains
0.0122 0.0141 0.0119 0.0127
Pakistan Rupee (PKR) the risks and rewards incidental to ownership of the assets are
classified as operating leases. Lease payments under operating
Bangladeshi Taka 0.0144 0.0144 0.0144 0.0144
leases are recognized as an expense in the income statement on
(BDT)
a straight-line basis over the lease term unless it is reasonably
0.8920 0.8876 0.9628 0.8304
Canadian Dollar (CAD) certain that the Group will obtain ownership by the end of the
lease term.
Euro 1.4134 1.4935 1.4551 1.4113
Intangible assets
Property and equipment
Intangible assets are identifiable non-monetary assets without
Property and equipment are stated at purchase cost or production
cost, net of accumulated depreciation and any impairment losses. physical substance which can be controlled and which are capable
of generating future economic benefits. Intangible assets are stated
Cost includes expenditure directly attributable to bringing the
asset to the location and condition necessary for use and any at purchase and/or production cost including any expenses that are
directly attributable to preparing the asset for its intended use, net
dismantling and removal costs which may be incurred as a result
of contractual obligations which require the asset to be returned to of accumulated amortization and impairment losses, if applicable.
Borrowing costs accruing during and for the development of the
its original state and condition. Borrowing costs directly associated
with the purchase or construction of property and equipment are asset are capitalized as incurred. Amortization begins when an
asset becomes available for use and is charged systematically
capitalized as incurred together with the asset to which they relate.
Costs incurred for ordinary and cyclical repairs and maintenance on the basis of the residual possibility of utilization of the asset,
meaning on the basis of its estimated useful life.
are charged directly to the income statement in the year in which
they are incurred. Costs incurred for the expansion, modernization
or improvement of the structural elements of owned or leased assets • Licenses
are capitalized to the extent that they have the requisites to be
separately identified as an asset or part of an asset, in accordance Costs for the purchase of telecommunication licenses are
capitalized. Amortization is charged on a straight-line basis such
with the “component approach”. Under this approach each asset
is treated separately if it has an autonomously determinable useful as to write off the cost incurred for the acquisition of a right over
the shorter of the period of its expected use and the term of the
life and value. Depreciation is charged at rates calculated to write
off the costs over their estimated useful lives on a straight-line underlying agreement, starting from the date on which the acquired
license may be exercised.
basis from the date the asset is available and ready for use.
• Goodwill
The useful lives of property and equipment and their residual
values are reviewed and updated, where necessary, at least at
each year end. Estimate in respect of certain items of “Cell Sites” Goodwill represents the excess of the cost of an acquisition over
were revised in 2009 (see note 18).Land is not depreciated. the interest acquired in the net fair value at the acquisition date of
When a depreciable asset is composed of identifiable separate the assets and liabilities of the entity or business acquired. Goodwill
relating to investments accounted for using the equity method is
components whose useful lives vary significantly from those of
included in the carrying amount of the investment. Goodwill is not
other components of the asset, depreciation is calculated for each
component separately, applying the “component approach”. systematically amortized but is rather subject to periodic tests to
ensure that the carrying amount in the balance sheet is adequate
44
(“impairment testing”). Impairment testing is carried out annually
or more frequently when events or changes in circumstances
occur that could lead to an impairment of the cash generating units
(“CGUs”) to which the goodwill has been allocated. An impairment
loss is recognized whenever the recoverable amount of goodwill
is lower than its carrying amount. The recoverable amount is the
higher of the fair value of the CGU less costs to sell and its value
in use, which is represented by the present value of the cash flows
expected to be derived from the CGU during operations and from
its retirement at the end of its useful life. The method for calculating
value in use is described in the paragraph below “Impairment
of assets”. Once an impairment loss has been recognized for
goodwill it cannot be reversed.
Whenever an impairment loss resulting from the above testing
exceeds the carrying amount of the goodwill allocated to a specific
CGU the residual loss is allocated to the assets of that particular
CGU in proportion to their carrying amounts. The carrying amount
of an asset under this allocation is not reduced below the higher
of its fair value less costs to sell and its value in use as described
above.
• Software
Acquired software licences are capitalised on the basis of the costs
incurred to acquire and bring to use the specific software. Software
licenses are amortized on a straight-line basis over their useful
life (between 3 to 8 years), while software maintenance costs are
expensed in the income statement in the period in which they are
incurred.
Costs incurred on development of software products are
recognized as intangible assets when the Group has intentions
to complete and use or sell the assets arising from the project,
considering the existence of a market for the asset, its commercial
and technological feasibility, its costs can be measured reliably
and there are adequate financial resources to complete the
development of the asset. Other development expenditures are
recognized in the income statement in the period in which they are
incurred.
Directly attributable costs that are capitalised as part of a software
product include software development employee costs and an
appropriate portion of relevant overheads. Other development
expenditures that do not meet these criteria are recognised as an
expense as incurred. Development costs previously recognised as
an expense are not recognised as an asset in a subsequent period.
• Customer List
The customer list as an intangible asset consists of the list
of customers identified when allocating the purchase price in
acquisitions carried out by the Group. Amortization is charged on
the basis of the respective estimated useful lives which range from
5 to 10 years.
Impairment of non-financial assets
At each balance sheet date, property and equipment and intangible
assets with finite lives are assessed to determine whether there is
any indication that an asset may be impaired. If any such indication
exists, the recoverable amount of the asset concerned is estimated
and any impairment loss is recognized in the income statement.
Intangible assets with an indefinite useful life are tested for
impairment annually or more frequently when events or changes
in circumstances occur that could lead to an impairment loss.
The recoverable amount of an asset is the higher of its fair value
less costs to sell and its value in use, which is represented by the
present value of its estimated future cash flows. In determining an
asset’s value in use the estimated future cash flows are discounted
using a pre-tax rate that reflects the market’s current assessment
of the cost of money for the investment period and the specific risk
profile of the asset. If an asset does not generate independent
cash flows its recoverable amount is determined in relation to the
cash-generating unit (CGU) to which it belongs. An impairment
loss is recognized in the income statement when the carrying
amount of an asset or the CGU to which it is allocated exceeds its
recoverable amount. If the reasons for previously recognizing an
impairment loss cease to exist, the carrying amount of an asset
other than goodwill is increased to the net carrying amount of
the asset that would have been determined (net of amortization
or depreciation) had no impairment loss been recognized for the
asset, with the reversal being recognized in the income statement.
Investments
Investments in companies other than those classified as available
for sale are measured at fair value with any changes in fair value
being recognized in the income statement. (The accounting
treatment of financial assets available for sale is discussed in
“Financial assets available for sale”). If fair value cannot be reliably
determined, an investment is measured at cost. Cost is adjusted
for impairment losses if necessary, as described in the paragraph
“Impairment of Assets”. If the reasons for an impairment loss no
longer exist, the carrying amount of the investment is increased
up to the extent of the loss with the related effect recognized in
the income statement. Any risk arising from losses exceeding the
carrying amount of the investment is accrued in a specific provision
to the extent of the Group’s legal or constructive obligations on
behalf of the associate. Investments held for sale or to be wound
up in the short term are classified as current assets and stated at
the lower of their carrying amount and fair value less costs to sell.
Financial instruments
Financial instruments consist of financial assets and liabilities
whose classification is determined on their initial recognition
and on the basis of the purpose for which they were purchased.
Purchases and sales of financial instruments are recognized at
their settlement date. Financial assets are derecognized when
the right to receive cash flows from them ceases and the Group
has effectively transferred all risks and rewards related to the
instrument and its control.
The fair values of quoted investments are based on current bid
prices. If the market for a financial asset is not active (and for
unlisted securities), the Group establishes fair value by reference
to prices supplied by third-party operators and by using valuation
models based primarily on objective financial variables and, where
possible, prices in recent transactions and market prices for similar
financial instruments.
• Financial Assets
Financial assets are initially recognized at fair value and classified
in one of the following four categories and subsequently measured
as described:
• Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss includes
financial assets purchased primarily for sale in the short term,
(held for trading) and derivative financial instruments, except for
the effective portion of those designated as cash flow hedges.
These assets are measured at fair value; any change in the year
is recognized in the income statement. Financial instruments
included in this category are classified as current assets if they are
held for trading or expected to be disposed of within twelve months
from the balance sheet date. Derivatives are treated as assets
or liabilities depending on whether their fair value is positive or
negative; positive and negative fair values arising from transactions
with the same counterparty are offset if this is contractually
provided for. Fair value gains and losses from foreign currency
swaps are recognized in foreign currency gains and losses in the
income statement.
• Financial receivables
Financial receivables are non-derivative financial instruments
which are not traded on an active market and which are expected
to generate fixed or determinable repayments. They are included
as current assets unless they are contractually due more than
twelve months after the balance sheet date in which case they
are classified as non-current assets. These assets are measured
at amortized cost using the effective interest method. If there is
objective evidence of factors which indicate impairment, the asset
is reduced to the present value of future cash flows. The impairment
loss is recognized in the income statement. If in future years the
factors which caused the impairment cease to exist, the carrying
amount of the asset is reinstated up to the amount that would have
been obtained had amortized cost been applied.
• Financial assets available-for-sale
Financial assets available for sale are non-derivative financial
instruments which are either designated in this category or not
classified in any of the other categories. Available for sale financial
assets are measured at fair value. Changes in the fair value
of monetary securities denominated in a foreign currency and
classified as available for sale are analyzed between translation
differences resulting from changes in amortized cost of the security
and other changes in the carrying amount of the security. The
translation differences on monetary securities are recognized in
profit or loss; translation differences on non-monetary securities
are recognized in equity. Changes in the fair value of monetary
and non-monetary securities classified as available for sale are
recognized in equity.
When securities classified as available for sale are sold or impaired,
the accumulated fair value adjustments recognized in equity are
included in the income statement.
The classification of an asset as current or non-current is the
consequence of strategic decisions regarding the estimated period
of ownership of the asset and its effective marketability, with those
which are expected to be realized within twelve months from the
balance sheet date being classified as current assets.
• Financial assets held to maturity
These are non-derivative assets with fixed maturities that the
Group has the intention and ability to hold to maturity. Those
maturing within 12 months are carried as current assets. These
financial assets are measured at amortized cost using the effective
interest method.
Impairment of financial assets
Individually significant financial assets are tested for impairment on
an individual basis. The remaining financial assets are assessed
collectively in groups that share similar credit risk characteristics.
In the case of equity securities classified as available for sale, a
significant or prolonged decline in the fair value of the security
below its cost is considered as an indicator that the securities are
impaired. If any such evidence exists for available for sale financial
assets, the cumulative loss – measured as the difference between
the acquisition cost and the current fair value, less any impairment
loss on that financial asset previously recognized in profit or loss
– is removed from equity and recognized in the income statement.
Impairment losses recognized in the income statement on equity
instruments are not reversed through the income statement.
Financial liabilities
Financial liabilities consisting of borrowings, trade payables
and other obligations are measured at amortized cost using the
effective interest method. When there is a change in cash flows
which can be reliably estimated, the value of the financial liability is
recalculated to reflect such change based on the present value of
expected cash flows and the originally determined internal rate of
return. Financial liabilities are classified as current liabilities except
where the Group has an unconditional right to defer payment until
at least twelve months after the balance sheet date.
Financial liabilities are derecognized when settled and the Group
has transferred all the related costs and risks relating to an
instrument.
Derivative financial instruments
Derivatives are initially recognized at fair value on the date a
derivative contract is entered into and subsequently remeasured
at fair value. The method of recognizing the resulting gain or loss
depends on whether the derivative is designated as a hedging
instrument, and if so, the nature of the item being hedged.
The Group documents at the inception of the transaction the
relationship between hedging instruments and hedged items, as
well as its risk management objectives and strategy for undertaking
various hedging transactions. The Group also documents its
assessment, both at hedge inception and on an ongoing basis, of
whether the derivatives that are used in hedging transactions are
highly effective in offsetting changes in fair values or cash flows of
hedged items.
The full fair value of a hedging derivative is classified as a current
asset or liability when the remaining maturity of the hedged item is
less than 12 months. Derivatives which do not qualify for hedge
accounting are classified as a financial asset at fair value through
profit or loss.
· Fair value hedge
Changes in the fair value of derivatives that are designated and
qualify as fair value hedges are recorded in the income statement,
together with any changes in the fair value of the hedged asset or
liability that are attributable to the hedged risk. If the hedge is not
fully effective, meaning that these changes are different, the non-
effective portion is treated as part of the net financing cost for the
year in the income statement.
· Cash flow hedge
The effective portion of changes in the fair value of derivatives
that are designated and qualify as cash flow hedges is recognized
in equity in a specific reserve (the “cash flow hedge reserve”) .
The gain or loss relating to the ineffective portion is recognized
immediately in the income statement.
A hedge is normally considered highly effective if from the beginning
and throughout its life the changes in the expected cash flows for
the hedged item are substantially offset by the changes in the
fair value of the hedging instrument. When the economic effects
deriving from the hedged item are realized, the related gains or
losses in the reserve are reclassified to the income statement
together with the economic effects of the hedged item. Whenever
the hedge is not highly effective, the non-effective portion of the
change in fair value of the hedging instrument is immediately
recognized as part of the net financing cost for the year in the
income statement.
When a hedging instrument expires or is sold, or when a hedge
45
no longer meets the criteria for hedge accounting, any cumulative
gain or loss existing in equity at that time remains in equity and is
recognized when the forecast transaction is ultimately recognized
in the income statement. When a forecast transaction is no longer
expected to occur, the cumulative gain or loss that was reported in
equity is immediately transferred to the income statement.
Inventories
Inventories are stated at the lower of purchase cost or production
cost and net realizable value. Cost is based on the weighted
average method. Net realizable value is the estimated selling price
in the ordinary course of business, less the estimated costs of
completion and selling expenses. When necessary, obsolescence
allowances are made for slow-moving and obsolete inventories.
Inventories mainly comprise handsets and SIM cards.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at
call with banks and other short-term highly liquid investments with
original maturities of three months or less.
Non-current assets and liabilities held for sale
Non-current assets (or disposal groups comprising assets and
liabilities) that are expected to be recovered primarily through sale
rather than through continuing use is classified as held for sale.
Immediately before classification as held for sale, the assets (or
components of a disposal group) are remeasured in accordance
with the Group’s accounting policies. Thereafter the assets and
liabilities held for sale (or disposal group) are measured at the
lower of their carrying amount and fair value less cost to sell.
Any impairment loss on a disposal group first is allocated to
goodwill, and then to remaining assets and liabilities on pro rata
basis, except that no loss is allocated to inventories, financial
assets, and deferred tax assets, which continue to be measured
in accordance with the Group’s accounting policies. Impairment
losses on initial classification as held for sale and subsequent
losses on remeasurement are recognised in the income statement.
Subsequent increase in fair value less costs to sell may be
recognised in the income statement only to the extent of the
cumulative impairment loss that has been recognised previously.
Current and deferred income tax
The tax expense for the period comprises current and deferred tax.
Tax is recognised in the income statement, except to the extent
that it relates to items recognised directly in equity. In this case, the
tax is also recognised in equity.
The current income tax charge is calculated on the basis of the tax
laws enacted or substantively enacted at the balance sheet date
in the countries where the Group’s subsidiaries, associates and
joint venture operate and generate taxable income. Management
periodically evaluates positions taken in tax returns with respect
to situations in which applicable tax regulation is subject to
interpretation. It establishes provisions where appropriate on the
basis of amounts expected to be paid to the tax authorities.
Deferred income tax is recognized, using the balance sheet liability
method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the consolidated
financial statements. However, deferred income tax is not
accounted for if it arises from initial recognition of goodwill or the
initial recognition of an asset or liability in a transaction other than
a business combination that at the time of the transaction affects
neither accounting nor taxable profit or loss. Deferred income tax
is determined using tax rates (and laws) that have been enacted or
substantially enacted at the balance sheet date and are expected
to apply when the related deferred income tax asset is realised or
the deferred income tax liability is settled.
Deferred income tax assets are recognized only to the extent that it
is probable that future taxable profit will be available against which
the temporary differences can be utilized.
Deferred income tax is provided on temporary differences arising
on investments in subsidiaries, associates and joint ventures,
except where the timing of the reversal of the temporary difference
is controlled by the Group and it is probable that the temporary
difference will not reverse in the foreseeable future.
Additional income taxes that arise from the distribution of dividends
are recognised at the same time that the liability to pay the related
dividend is recognised.
Deferred tax assets and liabilities are offset if there is a legally
enforceable right to offset current tax liabilities and assets, and
they relate to income taxes levied by the same tax authority on the
same taxable entity, or on different tax entities, but they intend to
settle current tax liabilities and assets on a net basis or their tax
assets and liabilities will be realised simultaneously.
Provisions
Provisions are only recognized when the Group has a present
legal or constructive obligation arising from past events that will
result in a future outflow of resources, and when it is probable that
this outflow of resources will be required to settle the obligation.
The amount provided represents the best estimate of the present
value of the outlay required to meet the obligation. The interest rate
used in determining the present value of the liability reflects current
market rates and takes into account the specific risk of each liability.
Provisions are not recognised for future operating losses.
Employee benefits
• Short-term benefits
Short-term benefits are recognized in the income statement in the
year when an employee renders service.
• Share-based employee benefits
The Group recognizes additional benefits to certain managers
and other members of personnel through share based payment
plans. IFRS 2 - Share-based Payment considers these plans to
represent a component of employee remuneration. The fair value
of the employee services received at the grant date in exchange
for the grant of options or shares is recognized as an expense
with a correspondent increase in equity. The total amount to
be expensed is determined by reference to the fair value of the
options granted, excluding the impact of any non-market service
and performance vesting conditions. The total amount expensed
is recognized over the vesting period, which is the period over
which all of the specified vesting conditions are to be satisfied.
Share capital
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of new shares are shown in equity as a
deduction, net of tax, from proceeds.
Treasury shares
Where any Group company purchases the Company’s equity
share capital (treasury shares), the consideration paid, including
any directly attributable incremental costs (net of income taxes) is
deducted from equity attributable to equity holders of the Company
until the shares are cancelled or re-issued. Where such shares
are subsequently re-issued, any consideration received, net of any
directly attributable incremental transaction costs and the related
income tax effects, is included in equity attributable to equity
holders of the Company.
Legal reserve
As per the Company’s statutes 5% of net profit for the year is set
aside to form a legal reserve, the transfer to such reserve ceases
once it reaches 50% of the Company’s paid in share capital. The
reserve can be utilized for covering losses or for increasing the
Company’s share capital. If the reserve falls below the said 50%,
the Company should resume setting aside 5% of its annual net
profit until the reserve reaches 50% of the Company’s paid in
share capital.
Dividend distribution
Dividend distribution to the Company’s shareholders is recognized
as a liability in the Consolidated Financial Statements in the
period in which the dividends are approved by the Company’s
shareholders.
Revenue recognition
Revenue comprises the fair value of the consideration received or
receivable for the sale of goods and services in the ordinary course
of the Group’s activities. Revenue is shown net of value added tax,
rebates and discounts and after eliminating sales within the Group.
Revenue from the sale of goods is recognized when the Group
transfers the risks and rewards of ownership of the goods.
Revenue from services is recognized in the income statement by
reference to the stage of completion and only when the outcome
can be reliably estimated.
More specifically, the criteria followed by the Group in recognizing
ordinary revenue are as follows:
• revenue arising from post-paid traffic, interconnection and
roaming is recognized on the basis of the actual usage
made by each subscriber and telephone operator. Such
revenue includes amounts paid for access to and usage
of the Group network by customers and other domestic
and international telephone operators;
• revenue from the sale of prepaid cards and recharging
is recognized on the basis of the prepaid traffic actually
used by subscribers during the year. The unused portion
of traffic at period end is recognized as “Liabilities –
Deferred Income”;
• revenue from the sale of mobile phones and fixed-line
phones and related accessories is recognized at the time
of sale;
• one-off revenue from landline and mobile (prepaid or
subscription) activation and/or substitution, prepaid
recharge fees and the activation of new services and tariff
plans is recognized for the full amount at the moment of
activation independent of the period in which the actual
services are rendered by the Group. In the case of
promotions with a cumulative plan still open at the end of
the year, the activation fee is recognized on an accruals
basis so as to match the revenue with the year in which
the service may be used.
Dividend income from investments recorded at fair value through
profit and loss or as available for sale is recognized when the right
to receive payment is established.
Interest income
Interest income is recognized on a time-proportion basis using the
effective interest rate method.  business are to be recorded at fair value at the acquisition date,
Earnings per share
Basic
Basic earnings per share are calculated by dividing the profit for
the year attributable to equity holders of the Company, both from
continuing and discontinued operations, by the weighted average
number of ordinary shares in issue during the year excluding
ordinary shares purchased by the Company and held as treasury
shares. 
Diluted
Diluted earnings per share are calculated by dividing the profit
for the year attributable to equity holders of the Company by the
weighted average of the number of ordinary shares of the Company
outstanding during the year where, compared to basic earnings
per share, the weighted average number of shares outstanding is
modified to include the conversion of all dilutive potential shares,
while the profit for the year is modified to include the effects of
such conversion net of taxation. Diluted earnings per share are
not calculated when there are losses as any dilutive effect would
improve earnings per share.
Discontinued operations
A discontinued operation is a component of the Group’s business
that represents a separate major line of business or geographical
area of operations that has been disposed of or is held for sale,
or is a subsidiary acquired exclusively with a view to resale.
Classification as a discontinued operation occurs upon disposal or
when the operation meets the criteria to be classified as held for
sale, if earlier. When an operation is classified as a discontinued
operation, the comparative income statement is re-presented
as if the operation had been discontinued from the start of the
comparative period.
Segment reporting
Operating segments are reported in a manner which is consistent
with the internal reporting information provided to the chief
operating decision-maker. The chief operating decision-maker, who
is responsible for allocating resources and assessing performance
of the operating segments, has been identified as the board of
directors.
Recent accounting pronouncements
The following new standards, amendments to standards and
interpretations have been issued but are not effective for the
financial year 2009 and have not been early adopted:
IAS 27 (revised), “Consolidated and separate financial statements”
will be effective for the Group from January 1, 2010. The revised
standard requires the effects of all transactions with non-controlling
interests to be recorded in equity if there is no change in control
and these transactions will no longer result in goodwill or gains and
losses. The standard also specifies the accounting when control
is lost. Any remaining interest in the equity is re-measured to fair
value, and a gain or loss is recognized in profit or loss. The Group
will apply IAS 27 (revised) prospectively to transactions with non-
controlling interests from January 1, 2010.
IFRS 3 (revised), “Business combinations,” will be effective for the
Group from January 1, 2010. The revised standard continues to
apply the acquisition method to business combinations, with some
significant changes. For example, all payments to purchase a
with contingent payments classified as debt subsequently re-
measured through the income statement. There is a choice on
46
an acquisition-by-acquisition basis to measure the non-controlling
interest in the acquiree either at fair value or at the non-controlling
interest’s proportionate share of the acquiree’s net assets. All
acquisition-related costs should be expensed. The Group will
apply IFRS 3 (revised) prospectively from January 1, 2010.
IFRS 5 (amendment) “Non-current assets held for sale and
discontinued operations” and consequential amendments to IFRS
1 “First-time adoption” will be effective for the Group from January
1, 2010. The amendment clarifies that all of a subsidiary’s assets
and liabilities are classified as held for sale if a partial disposal
sale plan results in loss of control. Relevant disclosure should be
made for this subsidiary if the definition of a discontinued operation
is met.
A consequential amendment to IFRS 1 states that these
amendments are applied prospectively from the date of transition
to IFRS. The Group will apply IFRS 5 (amendment) prospectively
to all partial disposals of subsidiaries from January 1,
2010.
IFRIC 17, “Distribution of non-cash assets to owners” will be
effective for the Group from January 1, 2010. The interpretation is
part of the IASB’s annual improvement project which was published
in April 2009. This interpretation provides guidance on accounting
for arrangements whereby the entity distributes non-cash assets
to shareholders either as a distribution of reserves or as dividends.
IFRS 5 has also been amended. The Group will apply IFRIC 17
from January 1, 2010.
IAS 38 (amendment), “Intangible Assets”. The amendment is part
of the IASB’s annual improvements project published in April 2009
and the Group will apply IAS 38 (amendment) from that date that
IFRS 3 (revised) is adopted (January 1, 2010). The amendment
to the standard clarifies guidance in measuring the fair value of an
intangible asset that is acquired in a business combination and
permits the grouping of intangible assets as a single asset if each
asset has similar useful economic lives.
IAS 1 (amendment), “Presentation of financial statements”. This
amendment is part of the IASB’s annual improvements project
published in April 2009. The amendment provides clarification
that the potential settlement of a liability by the issue of equity is not
relevant to its classification as current or non current. The Group
will apply IAS 1 (amendment) from January 1, 2010.
IFRS 2 (amendments), “Group cash-settled and share-based
payment transactions”. In addition to incorporating IFRIC 8, “Scope
of IFRS 2”, and IFRIC 11, “IFRS 2 - Group and treasury share
transactions”, the amendments expand on the guidance in IFRIC
11 to address the clarification of group arrangements that were not
covered by that interpretation. The new guidance is not expected
to have a material impact for the Group.
IAS 39 (amendment), “Financial instruments: Recognition and
Measurement. This amendment will be applicable for the Group
from 1 January 2010. The amendment on eligible hedged items
specifies that an entity may designate an option as a hedge of
changes in the cash flows or fair value of a hedged item above or
below a specified price or other variable. The provisions are to be
applied retrospectively.
IAS 32 (amendment), “Financial instruments: Presentation”. This
amendment will be applicable for the Group from January 1, 2011.
The amendment clarifies the classification of rights issues as
equity or liabilities when the rights are denominated in a currency
other than the issuer’s functional currency.
IAS 24, “Related Party Disclosures” will be effective for the Group
from January 1, 2011. The amendment simplifies the definition of
a related party by clarifying its intended meaning and elimination of
any inconsistencies from the definition and furthermore provides a
partial exemption from the disclosure requirements.
IFRS 9, “Financial Instruments” will be applicable for the Group
from January 1, 2013. IFRS 9 is the first part of Phase 1 of the
IASB’s project to replace IAS 39. IFRS 9 governs the classification
and measurement of financial assets.
IFRIC 14, “Prepayments of a minimum funding requirement” will be
applicable for the Group from January 1, 2011 . The amendment
applies in limited circumstances when an entity is subject to
minimum funding requirements and makes an early payment
of contributions to cover these requirements. The amendment
permits an entity to treat the benefit of such a payment as an asset.
IFRIC 19, “Extinguishing financial liabilities with equity instruments”
will be applicable for the Group from January 1, 2011. The
interpretation provides guidance on how to interpret IFRS when an
entity renegotiates the terms of a financial liability with its creditor
and the creditor agrees to accept equity instruments to fully or
partially settle the financial liabilities.
3- Use of Estimates
The preparation of these Consolidated Financial Statements
required management to apply accounting policies and
methodologies that are based on complex, subjective judgments,
estimates based on past experience and assumptions determined
from time to time to be reasonable and realistic based on the related
circumstances. The use of these estimates and assumptions
affects the amounts reported in the balance sheet, the income
statement and the cash flow statement as well as the notes. The
final amounts for items for which estimates and assumptions
were made in the Consolidated Financial Statements may differ
from those reported in these statements due to the uncertainties
that characterize the assumptions and conditions on which the
estimates are based.
The accounting principles requiring a higher degree of subjective
judgment in making estimates and for which changes in the
underlying conditions could significantly affect the Consolidated
Financial Statements are briefly described below.
Goodwill
Goodwill is tested for impairment on an annual basis to determine
whether any impairment losses have arisen that should be
recognized in the income statement. More specifically, the test is
performed by allocating the goodwill to a cash generating unit and
subsequently estimating the unit’s fair value. Should the fair value
of the net capital employed be lower than the carrying amount
of the CGU an impairment loss is recognized for the allocated
goodwill. The allocation of goodwill to cash generating units and
the determination of the fair value of a CGU requires estimates to
be made that are based on factors that may vary over time and that
could as a result have an impact on the measurements made by
management which might be significant.
Impairment of non-current assets
Non-current assets are reviewed to determine whether there are
any indications that the net carrying amount of these assets may not
be recoverable and that they have suffered an impairment loss that
needs to be recognized. In order to determine whether any such
elements exist it is necessary to make subjective measurements,
based on information obtained within the Group and in the market
and also on past experience. When a potential impairment loss
emerges it is estimated by the Group using appropriate valuation
techniques. The identification of the elements that may determine
a potential impairment loss and the estimates used to measure
such loss depend on factors which may vary over time, thereby
affecting the estimates and measurements.
Depreciation of non-current assets
The cost of property and equipment is depreciated on a straight-
line basis over the useful lives of the assets. The useful life of
property and equipment is determined when the assets are
purchased and is based on the past experience of similar assets,
market conditions and forecasts concerning future events which
may affect them, amongst which are changes in technology. The
actual useful lives may therefore differ from the estimates of these.
The Group regularly reviews technological and business sector
changes, dismantling costs and recoverable amounts in order to
update residual useful lives. Such regular updating may entail a
change of the depreciation period and consequently a change in
the depreciation charged in future years.
Deferred tax assets
The recognition of deferred tax assets is based on forecasts of
future taxable profit. The measurement of future taxable profit for
the purposes of determining whether or not to recognize deferred
tax assets depends on factors which may vary over time and which
may lead to significant effects on the measurement of this item.
Income tax
The companies of the Group are subject to different tax legislation.
A significant amount of estimates are necessary in order to account
for the total tax effects on the financial statements. The Group has
a number of operations for which the relevant taxes are difficult
to estimate and thus has to accrue some tax liabilities based on
estimates. Whenever the actual tax expense is different from the
estimated, the difference is recorded in the income statement.
Fair value of derivatives and other financial instruments
The fair value of financial instruments is determined based on
quoted market prices, where available, or on estimates using
present values or other valuation techniques. Those techniques
are significantly affected by the assumptions used, including
discount rates and estimates of future cash flows. Where market
prices are not readily available, fair value is based on either
estimates obtained from independent experts or quoted market
prices of comparable instruments.
Provisions and contingencies
In recognizing provisions the Group analyses the extent to which it
is probable that a liability will arise from disputes with employees,
suppliers and third parties and in general the losses it will be
required to incur as a result of past obligations. The definition of
such provisions entails making estimates based on currently known
factors which may vary over time and which could actually turn out
to be significantly different from those referred to in preparing the
financial statements.
4- Financial Risk Management
Financial Risk Factors
The Group’s activities expose it to a variety of financial risks: market
risk (including currency risk, fair value interest risk and cash flow
interest risk), credit risk and liquidity risk. In particular the Group is
exposed to risks from movements in exchange rates, interest rates
and market prices. The Group’s overall risk management program
focuses on the unpredictability of financial markets and seeks to
minimize potential adverse effects on the Group’s performance
through ongoing operational and finance activities. Depending on
the risk assessment, the Group uses selected derivative hedging
instruments. The management has overall responsibility for the
establishment and oversight of the group’s risk management
framework.
Market Risk
Foreign exchange risk
The Group operates internationally and is exposed to foreign
exchange risk arising when its business transactions are in
currencies other than its functional currency. The main currencies
to which the Group is exposed are the US dollar, the Canadian
Dollar and the Euro.
In general the Group’s subsidiaries are encouraged to obtain
financing in their functional currency in order to have a natural
hedge of the exchange rate of such financing. However, as some
transactions are executed in foreign currencies, and in particular
in US$, CAD and Euro, the Group may be subject to the risk of
exchange rate fluctuations which, in certain instances the Group
manages through the use of hedging strategies. As of December 31,
2009 the Group’s borrowings included US$ borrowings amounting
to US$ 4,232 million and Euro borrowings amounting to Euro 248
million (equivalent to US$ 361 million). In certain instances the
Group has entered into economic hedging agreements to manage
the risk of fluctuations relating to these financing operations. In
particular, Pakistan Mobile Communication Limited (PMCL) had
borrowings for US$ 177 million and Euro 190 million (equivalent
to US$ 276 million) as of December 31, 2009. Such borrowings
were fully hedged by PMCL using cross currency swaps pursuant
to which interest payments and principal payments are paid in
Pakistani Rupee.
The Group subsidiaries generally execute their operating activities
in their respective functional currencies. Some Group subsidiaries
are, however, exposed to foreign currency risks in connection with
scheduled payments in currencies that are not their functional
currencies. In general this relates to foreign currency denominated
supplier payables and receivables. The Group monitors the
exposure to foreign currency risk arising from operating activities
and, where relevant, enters into hedging transactions in order to
manage the exposure.
As of December 31, 2009, if the functional currencies had weakened
/ strengthened by 3% against the US$, the Euro and CAD, with all
other variables held constant, the translation of foreign currency
receivables and payables would have resulted in a decrease/
increase in profit for the year (after tax)of US$ 65 million, mainly
relating to US$ denominated borrowings.
Additionally, the Group has investments in foreign operations,
whose net assets are exposed to foreign currency translation risk.
Currency exposure to such risk is not hedged.
Cash flow and fair value interest rate risk
The Group is exposed to market risks as a result of changes in
interest rates particularly in relation to borrowings. Borrowings
issued at floating rates expose the Group to cash flow interest rate
risk. Borrowings issued at fixed rates expose the Group to fair
value interest rate risk.
The basic strategy of interest rate risk management is to balance
the debt structure with an appropriate mix of fixed and floating
interest rate borrowings based on the Group’s perception of future
interest rate movements. In particular, the risk monitored relates
to the impact of movements in floating rate indices on the Group’s
finance costs.
When considered appropriate, the Group manages its cash flow
47

interest rate risk by using floating-to fixed interest rate swaps. In Holdings Corp (“Globalive”). The amount of these loans
particular, as of December 31, 2009 the Group had two interest rate was further increased to CAD 608 million during 2009. Carrying Expected cash Less than 1 Between 1 and 5 More than 5
As of December 31, 2008
derivative contracts. The first contract is a floating-to-fixed interest As of December 31, 2009 the amount outstanding under amount flows (*) year years years
rate swap with a notional value of US$ 1.5 billion and the other such loan agreements, including accrued interest, was
Liabilities
contract is a switchable interest rate swap with a notional value CAD 723 million (equivalent to US$ 696 million).The
of US$ 500 million. After considering such derivative transactions loans were primarily provided to GWMC to fund the Liabilities to banks 4,421 5,515 734 4,563 218
approximately 57% of the Group’s total borrowings had a floating acquisition of spectrum licenses in Canada. The licenses Bonds 1,153 1,627 114 733 780
rate of interest. were awarded to GWMC during March 2009 by Industry Finance lease liability 33 45 12 33 -
Canada and GWMC launched operations in December Other borrowings 15 15 12 3 -
The Group considers the sensitivity of its finance costs to 2009. During the start-up phase of operations Globalive
Telecommunication license payable 395 477 204 184 89
movements in interest rates. In particular an increase / decrease has incurred losses and as a result the Group’s share
of 1.0% in interest rates as of December 31, 2009 would have of losses exceeds the carrying value of the investment. Trade payables 1,186 1,186 1,186 - -
resulted in an increase / decrease in finance costs of US$ 33 The Group considers the loan provided as part of the 7,203 8,865 2,262 5,516 1,087
million and a decrease / increase in the cash flow hedge reserve investment and has therefore deducted the excess
of US$ 34 million. losses from the receivable. After considering such losses * Expected cash flows are the gross contractual undiscounted cash flows including interest, charges and other fees.
an amount of US$ 643 million is recorded in financial The table below analyses the group’s derivative financial instruments amounts disclosed in the table are the contractual undiscounted
Price risk receivables. (see Note 20 “Other financial assets” for into relevant maturity groupings based on the remaining period cash flows.
further details) at the balance sheet date to the contractual maturity date. The
The Group has limited exposure to equity securities price risk on • In November 2008 the Company sold its investment
investments held by the Group. in Orasinvest Holding Inc. (“OrasInvest”). The total Less than 1 More than 5
receivable from the sale amounted to US$ 180 million, As of December 31, 2009 Expected cash flows (*) Between 1 and 5 years
year years
Credit Risk prior to price adjustments. Of this US$ 180 million, US$ Cash outflow / (cash inflow)
90 million was received in 2008 and a further US$ 75
The Group considers that it is not exposed to major concentrations million was received and settled in 2009. As of December Interest rate derivatives 98 65 33 -
of credit risk in relation to trade receivables. However, credit 31, 2009 the amount outstanding was US$ 15 million. Foreign exchange derivatives (214) (41) (173) -
risk can arise in the event of non-performance of a counterparty, The remaining receivable is expected to be settled during
particularly in relation to credit exposures for trade and other 2010. Other derivative instruments - cash intflow (16) - (16) -
receivables, financial instruments and cash and cash equivalents. Total (132) 24 (156) -
In general the remaining other receivables and financial receivables
The Group considers that the concentration of credit risk with respect included in financial assets generally relate to a variety of smaller Less than 1 Between 1 and 5
As of December 31, 2008 Expected cash flows (*) More than 5 years
to trade receivables is limited given that the Group’s customer base amounts due from a wide range of counterparties, therefore, the year years
is largely pre-paid subscribers. Post paid subscribers generally Group does not consider that it has a significant concentration of Cash outflow / (cash inflow)
represent a small portion of the subscriber base and therefore the credit risk. Interest rate derivatives 116 43 73 -
credit exposure is limited. In addition, the Group tries to mitigate Foreign exchange derivatives (2) 10 (11) (1)
credit risk by adopting specific control procedures, including Liquidity Risk Other derivative instruments - cash outflow 31 31 - -
assessing the credit worthiness of the counterparty and limiting the
Other derivative instruments - cash inflow (31) (31) - -
exposure to any one counterparty. The Group monitors and mitigates liquidity risk arising from the
uncertainty of cash inflows and outflows by maintaining sufficient Total 114 53 62 (1)
Credit risk relating to cash and cash equivalents, derivative liquidity of cash balances as well as undrawn credit lines and * Derivative cashflows for interest rate derivatives and foreign and cash outflow for other derivative instruments are shown
financial instruments and financial deposits arises from the risk by diversifying its sources of finance. In general, liquidity risk is exchange derivatives represent the net cashflow from the relevant separately as such derivatives are gross settled.
that the counterparty becomes insolvent and accordingly is unable monitored at entity level whereby each subsidiary is responsible swap transaction as such derivatives are net settled. Cash inflow
to return the deposited funds or execute the obligations under the for managing and monitoring its cashflows and rolling liquidity
derivative transactions as a result of the insolvency. To mitigate reserve forecast in order to ensure that it has sufficient committed Derivative cash outflows do not include the potential cash outflows Group are affected by the current and future economic and political
this risk, wherever possible the Group conducts transactions facilities to meet its liquidity needs. should the share warrants of My Screen and Lingo be exercised. developments in these countries. In particular, the results of
and deposits funds with financial institutions with a minimum of The exercise of such warrants is at the option of the Company. operations could be unfavorably affected by changes in the political
investment grade rating. The table below analyses the group’s financial liabilities into Details of such warrants are provided in Note 20 “Other financial or governmental structures or weaknesses in the local economies
relevant maturity groupings based on the remaining period at assets”. Contractual cash flows are derived based on the relevant in the countries where it operates. These changes could also have
The Group is exposed to credit risk relating to financial receivables the balance sheet to the contractual maturity date. The amounts index as of the balance sheet date. an unfavorable impact on financial condition, performance and
as follows: disclosed in the table are the contractual undiscounted cashflows. business prospects.
Capital risk management
• During 2008 the Company entered into two loans Regulatory risk in emerging countries
agreements to provide a total amount of CAD 508 million The Group’s objectives when managing capital are to safeguard
to Globalive Wireless Management Corp (“GWMC”), the Group’s ability to continue as a going concern in order to Due to the nature of the legal and tax jurisdictions in the emerging
a subsidiary of the associate Globalive Investment provide returns for shareholders and to maintain an optimal capital countries where the Group operates, it is possible that laws and
structure to reduce the cost of capital. In order to maintain or regulations could be amended. This could include factors such
adjust the capital structure, the Group may, among other things, as the current tendency to withhold tax on the dividends of these
Carrying Expected cash Less than 1 Between 1 and 5 More than 5 adjust the amount of dividends paid to shareholders, return capital subsidiaries, receiving excessive tax assessments, granting of
As of December 31, 2009
amount flows (*) year years years to shareholders through share buyback transactions, issue new relief to certain operations and practices relating to foreign currency
Liabilities shares or sell assets to reduce debt. exchange. These factors could have an unfavorable effect on the
financial activities of the Group and on the ability to receive funds
Liabilities to banks 4,475 5,012 1,021 3,969 22 Other risks from the subsidiaries.
Bonds 1,255 1,674 159 1,515 -
Finance lease liability 24 43 7 15 21 Political and economic risk in emerging countries Revenue generated by the majority of the Group subsidiaries is
expressed in local currency. The Group expects to receive most
Other borrowings 19 18 18 - - A significant amount of the Group’s operations are conducted in of this revenue from its subsidiaries and therefore it relies on their
Telecommunication license payable 363 420 286 60 74 Algeria, Pakistan, Egypt and Tunisia. The operations of the Group ability to be able to transfer funds. The regulations in the various
depend on the market economies of the countries in which the countries where the subsidiaries operate could reduce the ability to
subsidiaries operate. In particular, these markets are characterized pay interest and dividends and to repay loans, credit instruments
Trade payables 1,043 1,043 1,043 - -
by economies that are in various stages of development or are and securities expressed in foreign currency through the transfer
7,179 8,210 2,534 5,559 117 undergoing restructuring. Therefore the operating results of the of currency. In addition, in some countries it could be difficult to
48

convert large amounts of foreign currency due to central bank Other

regulations. The central banks may amend regulations in the • Other Telecom service (Non GSM Service) which includes Other Telecom Holdings
  Algeria Pakistan Egypt Tunisia Bangladesh Consolidated
future and therefore the ability of the Company to receive funds other territories in which the Group operates as a mobile GSM services & Others
from its subsidiaries may be restricted. telecommunication operator and other services. (Non GSM)

2009                  
5- Segment reporting The Group reports on operating segments which are independently
managed. The board of directors assesses the performance of 2008                  
The chief operating decision-maker has been identified as the such operating segments based on: Total segment revenue - current year 1,868 1,061 944 357 351 107 358 63 5,109
board of directors of the Group. The board of directors reviews
the Group’s internal reporting in order to assess its performance • Total revenues Total segment revenue - previous year 2,088 1,231 891 362 288 26 793 - 5,679
and allocate resources, mainly from a geographical perspective, • EBITDA, defined as profit for the period before income tax (Inter-segment revenue - current year) - (2) - - - - (42) - (44)
of the mobile telecommunication business. Management has expense (or if applicable profit from continuing operations (Inter-segment revenue - previous year) (47) (23) - (36) - - (246) - (352)
determined the reportable for the period before income tax expense), gains (losses) on
operating segments according to the information analyzed disposal of associates, share of profit (loss) of associates, Total revenue from external customers -
1,868 1,059 944 357 351 107 316 63 5,065
periodically by the board of directors as follows: foreign exchange gains (losses), financial expense, financial current year
income, disposal of non current assets, impairment charges, Total revenue from external customers -
2,041 1,208 891 326 288 26 547 - 5,327
• Mobile telecommunication business in Algeria; depreciation and amortization and net unusual capital loss, previous year
• Mobile telecommunication business in Pakistan;                    
and
• Mobile telecommunication business in Egypt; • Segment capital expenditure is the total cost incurred during EBITDA - current year 1,014 385 445 192 103 17 (1) 17 2,172
• Mobile telecommunication business in Tunisia; the period to acquire property, plant and equipment, and EBITDA - previous year 1,225 409 415 190 2 (2) 27 118 2,384
• Mobile telecommunication business in Bangladesh; intangible assets other than goodwill.
• Other GSM which comprises the mobile telecommunication                    
businesses in Central and South Africa and Namibia and The information provided to the board of directors is measured Depreciation, amortization & Impairment -
(337) (264) (167) (56) (120) (36) (38) (5) (1,023)
North Korea ; and current year
consistently with that of the financial statements.
Depreciation, amortization & Impairment -
(334) (253) (148) (57) (92) (4) (60) (3) (951)
previous year
                   
Net unusual capital loss - current year (15) - - - - - - - (15)

Net unusual capital loss - previous year - - - - - - - - -

Disposal of non current assets - current year   1 (1)   (1)   63 (20) 42

Disposal of non current assets - previous year (26) (42) (22) (2) (7) - 5 160 66
                   
Financial Income - current year 3 34 5 2 1 3 1 46 95

Financial Income - previous year 3 5 4 1 1 - 3 35 52

Financial expense - current year (10) (122) (63) (5) (28) (15) (9) (259) (511)

Financial expense - previous year (15) (118) (52) (11) (27) (3) (12) (230) (468)

Share of (losses) of associates - current year - - - - - - - (47) (47)

Share of (losses) of associates - previous year - - - - - - - (3) (3)

Gain on disposal of associates- current year - - - - - - - - -

Gain on disposal of associates- previous year - - - - - - - 27 27

Profit (loss) before income tax - current year 652 (35) 222 130 (45) (30) 14 (168) 740

Profit (loss) before income tax - previous year 849 (107) 192 123 (122) (9) (48) 28 906

Total assets - current year 2,474 2,381 1,477 485 967 471 568 1,276 10,099

Total assets - previous year 2,420 2,764 1,367 466 961 308 643 999 9,928

Total Borrowings - current year 86 1,021 453 84 341 57 27 3,803 5,872

Total Borrowings - previous year 133 1,187 491 123 302 9 74 3,416 5,735

Capital Expenditure - current year 257 150 225 45 130 91 106 31 1,035

Capital Expenditure - previous year 174 554 483 50 441 56 165 5 1,928

* Holding and other mainly represent income and expense relating to activities provided from the holding and other companies. These
represent mainly management fees and revenue as a result of supporting activities provided by Orascom Telecom Holding.
The following table provides a breakdown of revenue by product and service:
49

2009 2008 7- Revenues an increase in maintenance costs due to an increase in the number The table below provides a breakdown of the average number of
Product and services     of cell sites and general utilities costs and an increase in costs of employees for the years ended December 31, 2009 and 2008:
Mobile 4,686 4,780 2009 2008 handsets, scratch cards, sim cards, bundle cost mainly due to the
increased sales of Ring. Average for the year ended
Fixed - line and Internet 316 547 Revenues from services  
Other revenue & income 63 - Telephony services 3,975 3,994 December 31,
9- Other expenses (in number of employees) 2009 2008
Total revenue 5,065 5,327 Interconnection traffic 599 864
International and national Senior management 255 205
6- Assets and liabilities classified as held for sale 131 150 2009 2008 Middle management 1,574 1,355
roaming
118 75 Licenses costs 57 55 15,039 15,012
Other services Staff
The following provides a breakdown of assets and liabilities held Travel costs 16 21 Total
Total revenues from services 4,823 5,083 16,868 16,572
for sale as of December 31: Accruals for provisions 32 14
 
Total revenues from sale of Allowance for doubtful receivables 39 19 11- Depreciation and amortization
2009 2008 242 244 Taxes (other than income tax) 4 17
goods
      Training expenses 9 11 2009 2008
Property and equipment 46 11 Total 5,065 5,327 Other operating expenses 58 37 Depreciation of property and
   
Intangible assets 30 20 Total 215 174 equipment:
Trade receivables 12 40 Revenues from telephony services decreased in 2009 compared -Cell sites 744 686
Other current assets 8 1 to 2008 mainly as a result of a decrease in calling rates as part of The increase in other expenses was primarily attributable to -Computers, fixtures and other
the increase in accruals for provisions, allowance for doubtful 59 63
Cash and cash equivalents 14 8 a marketing campaign due to competition with the other operators. equipment
Revenues from interconnection traffic decreased in 2009 receivables and other operating expenses during 2009. The -Buildings 24 23
compared to 2008 mainly due to the sale of the Group’s gateway increase in the allowance for doubtful receivables was mainly    
Assets held for sale 110 80 carrier M-Link in January 2009. (See Note 34 “Related party related to a revision of allowance for doubtful debts policy in OTA. Amortization of intangible assets    
transactions” for further information) Revenue from international While the accruals for provisions increased by US$18 million
-Licenses 114 112
and national roaming decreased in 2009 due to the agreement of mainly relating to the accruals for the tax dispute in Algeria. Taxes
Current and non-current borrowings 24 - (other than income tax) decreased mainly due to the sale of M-Link. -Other intangible assets 43 28
discounts with many operators and low prices offered to compete
Total 984 912
Trade payables 15 22 in the challenging markets across the territories during 2009.
In general revenues during 2009 were negatively impacted by 10- Personnel costs
Other current liabilities 15 2 Depreciation and amortization increased due to the increase in cell
the movements in local currencies compared to the US$ and in sites depreciation primarily as a result of an increase in investments
Current income tax liabilities - 1 particular movements in the Algerian Dinar and Pakistan Rupee. 2009 2008 in the network.
Deferred tax liabilities 1 - Wages and salaries 208 195
8- Purchases and services Bonuses given to management and 12- Impairment charges
Liabilities held for sale 55 25 61 45
employees
Assets and liabilities held for sale include the following: 2009 2008 Social security 17 16 Impairment charges amounting to US$ 39 million in 2009 mainly
Interconnection traffic and Share based compensation 12 11 relate to the impairment of US$17 million for plant and equipment in
589 711
Link Egypt and Link Dot Net roaming Pension costs 9 7 PMCL in Pakistan and LinkDotNet Telecom, a subsidiary of PMCL
Cost of handsets, scratch cards, operating in Pakistan as well as impairment of goodwill amounting
313 311 Board of Directors remuneration 4 3
sim cards, bundle cost to US$6 million in LinkDotNet Telecom. The impairments in
In February 2009 the Company stated that they had received Advertising and promotional Other personnel costs 21 22
an indicative non-binding offer for the acquisition of 100% of the 189 253 LinkDotNet Telecom are mainly as a result of the uncertainties for
services the future expectations of this business.
shares of LINKdotNET and Link Egypt. In accordance with IFRS 5 Internet and fixed line costs 241 245 Total 332 299
the assets and liabilities held for sale in disposal groups have been
separately shown in specific captions on the consolidated balance Customer acquisition costs 232 222 13- Unusual Items
Maintenance costs 233 190 The increase in personnel cost was primarily due to the increase
sheet. The income statement effects of these entities have not
Utilities 137 132 in the number of employees in 2009 compared to 2008 as well as During November 2009 Orascom Telecom Algeria S.p.A. and Ring
been shown as discontinued operations as they do not represent a
restructuring and an increase in salaries mainly in the Company Algeria LLC, subsidiaries of the Company, experienced damage
separate major line of business. Rental of network 70 85
and Egyptian Company for Mobile Services S.A.E. (“ECMS”). to shops, warehouses and infrastructure, as well as break-
Other leases and rentals 72 76 Bonuses increased in 2009 compared to 2008 mainly relating to
Oracap Far East Ltd reclassified as held for use. ins to premises and theft of equipment, during football related
Rental of civil and technical sites 77 71 bonuses paid in PMCL in 2009 as a result of reaching operational disturbances in Algeria.
Consulting and professional targets.
65 58
Orascom Telecom Holding management decided to stop the services
Consumable materials, The cost of damaged inventories, as a result of such disturbances,
process of sale of Oracap Far East Ltd. and reclassified as held 20 48 The table below provides a breakdown of the number of employees
equipment and goods amounted to US$ 18 million, whilst the damage to property and
for use. as of December 31:
Cost for security service 35 37 equipment amounted to US$ 24 million.
Sale of M-link S.a.r.l (Luxemburg) (M-Link) Cost for printing & collection
20 12 (in number of employees) 2009 2008 Both entities have submitted formal claims to their insurance
The assets and liabilities of M-Link were presented as held for sale services
Other service expenses 71 60 Senior management 294 216 companies relating to this incident. Furthermore, a technical
in 2008, following the decision of management of the Company to
Middle management 1,701 1,447 assessment performed by an independent insurance expert stated
focus on GSM business and dispose of non-core assets. On January Total 2,364 2,511
that the minimum expected recovery from the insurance company
13 th, 2009 the Company announced the sale of 100% of M-Link Staff 15,218 14,859
Purchases and services costs decreased during 2009 primarily is 1 billion DZD (equivalent to US$ 14 million).
to TLC SERVIZI S.p.A (now renamed Wind International Services Total 17,213 16,522
S.p.A.), a wholly owned subsidiary of Wind Telecomunicazioni due to the weakening of the local currencies compared to the US$.
As a percentage of revenues, purchase and service costs were This incident is considered as an exceptional event which is outside
S.p.A., for a total consideration of approximately US$ 78 million in
substantially consistent, amounting to 46.7% in 2009 and to 47.1% with the normal course of operations and has been recorded in
cash. (See Note 34 “Related party transactions”).
in 2008. the income statement as unusual items. After considering the
expected minimum insurance proceeds, an amount of US$13
In particular, interconnection traffic and roaming costs decreased in million has been recorded as an unusual inventory loss relating
2009 compared to 2008 mainly due to the sale of M-Link in January to the damaged inventories and an amount of US$15 million has
2009. Advertising and promotional expenses decreased in 2009 been recorded as an unusual capital loss relating to the damaged
compared to 2008 mainly due to a change in policy in Bangladesh. property and equipment.
Consumable materials, equipment and goods decreased in 2009
due to the sale Orasinvest. These items were partially offset by
50

14- Disposal of non-current assets 16- Share of loss of associates and gain on disposal of associates   2009 2008 The Group’s income tax expense decreased from US$ 403 million
in 2008 to US$ 361 million in 2009 while the effective tax rate
The gain on disposal of non-current assets amounting to US$ Share of loss of associates in 2009 and 2008 relates to the Profit before income tax 740 906 increased from 44% to 49%, respectively. The increase in the
44 million in 2009 mainly relates to the gain of US$ 35 million on investment in Globalive Canada Investment Holdings Corp. and effective tax rate was primarily attributable to the provision charged
Globalive Canada Holdings Corp. (collectively “Globalive”). The Tax calculated at Company›s
disposal of M-Link which was sold to Wind Telecomunicazioni SpA 148 181 to Income tax expense during 2009 with an amount of US$ 30
for a cash consideration of US$ 77 million during January 2009. Group holds a 65.4% investment in Globalive which comprises a income tax rate million against the tax claims 2004-2007 which has been received
(See Note 34 “Related party transactions”) combination of voting and non-voting rights. Considering direct Different income tax rates in by Orascom Telecom Algeria S.P.A. (“OTA”).
and indirect interests, the Group holds 65.4% of the outstanding 96 87
subsidiaries
Gain on disposal of non-current assets amounting to US$ 68 million shares and directly holds 33.2% of the voting rights. The Group
in 2008 mainly relates to the gain on the disposal of the subsidiary has significant influence over this investment and does not have Theoretical income tax for the year 244 268
OrasInvest. During 2009 a further gain of US$ 7.7 million was control over the financial and operating policies of Globalive. Permanent differences 22 16
recorded relating to a post acquisition sale price adjustment. Therefore the investment is equity accounted. Unrecognized deferred tax for tax
50 90
The following table provides selected financial information of losses
15- Net financing costs Globalive as of December 31, 2009 and 2008 and for each of the Reversal of expired deferred tax
years then ended. - 8
assets for tax losses
(in million of US$) 2009 2008
Utilization of previously
Interest on deposits and bank
24 29 2009 2008 - (16)
accounts unrecognized deferred tax assets
Current assets 64 373 Unrecognized deferred tax
Interest on non-current financial Non-current assets 762 2 - 19
receivables
11 15 liabilities on unremitted earnings
Current liabilities 196 405
Other financial income 37 6 Adjustments in respect of prior years 48 -
Non-current liabilities 722 -
Gain on extinguishment of debt 23 - Revenue 47 - Other differences (3) 18
Dividends from investments - 2 Net loss (92) (29) Income tax for the year 361 403
Financial income 95 52 % shareholding 65.4% 65.4%
    18- Property and equipment
proportional share of net loss (60) (19)
Interest on bonds (106) (91)
Computers,
Interest on other borrowings (343) (318) Amortization expense of identifiable
(3) Land and fixtures Assets Under
Interest on other liabilities and other assets -   Cell Sites Total
(62) (59) Buildings and other Construction
financial expense Elimination of proportional share of equipment
16 16
Financial expense (511) (468) intra group interest expense
Cost
Share of loss in associate (47) (3)
As of January 1, 2009 180 5,936 336 955 7,407
Foreign exchange gain /(loss) 33 (354)
Fair value changes of FX derivative Gain on disposal of associates in 2008 amounting to US$ 27 Additions 44 267 52 626 989
(6) 153 million relates to the disposal of the remaining investment in Change in the scope of consolidation 1 28 3 5 37
instruments
Hutchison Telecommunications International Limited (“Hutchison
Net foreign exchange gain /(loss) 27 (201) Assets held for sale - (56) (16) (3) (75)
Telecommunications”). In October and November 2007 the Group
Net financing cost (389) (617) sold 5% of its investment in this associate and the remaining Disposals (26) (28) (16) (16) (86)
investment was sold in January 2008. Currency translation differences (3) (147) (5) (18) (173)
Gain from extinguishment of debt in 2009 relates to the tender
Reclassifications - 717 2 (719) -
offer by PMCL which was completed in May 2009 to repurchase 17- Income tax expense
a portion of its senior notes. As a result of this tender offer, As of December 31, 2009 196 6,717 356 830 8,099
PMCL repurchased the notes at a repurchase price of US$ 730    
per US$ 1,000 of principal amount. As a result of the transaction 2009 2008 Accumulated Depreciation and
PMCL cancelled debt of approximately US$ 138 million for cash Current income tax expense 407 427  
Impairment
consideration of US$ 101 million. The difference between the Deferred taxes (46) (24) As of January 1, 2009 58 2,094 186 16 2,354
repurchase price and carrying value of the debt was recorded as Income tax expense 361 403 Charge for the year 24 744 59 - 827
gain from extinguishment of debt, net of the effects of closing out
derivatives associated with this debt. Current income tax receivables and liabilities in the consolidated Change in the scope of consolidation - 5 1 - 6
balance sheet are as follows: Assets held for sale - (22) (7) - (29)
Financial income increased in 2009 mainly relating to the interest Disposals (12) (19) (13) - (44)
accrued on the loans to Globalive. (See Note 20 “Other financial 2009 2008 Impairment loss - 5 2 17 24
assets” for further information). Current income tax receivable 100 75 Currency translation differences (2) (59) (10) - (71)
Current and non current income tax As of December 31, 2009 68 2,748 218 33 3,067
Financial expense increased mainly due to an increase in interest (187) (384)
liabilities
on bonds which related to the issuance of a US$ 230 million bond    
(“Oscar Bond”) in February 2009 (see Note 26 “Borrowings”). The tax on the Group’s profit before tax differs from the theoretical Net book value as of December 31, 2008 122 3,842 150 939 5,053
amount that would arise using the weighted average tax rate Net book value as of December 31, 2009 128 3,969 138 797 5,032
The gain in foreign exchange is mainly due to unrealized gain applicable to profits of the consolidated entities as follows:
on translation of supplier facilities, telecommunication license
payables and borrowings due to the strengthening of the EGP,PKR
and DZD against the US$.

Fair value changes on FX derivative instruments relates to the

changes in the fair value of the cross currency swaps held by
PMCL in connection with the economic hedge of borrowings
51

Computers, (in million of US$) 2009 From 2010 to 2017 Later

Land and fixtures Assets Under (Decrease) increase in depreciation expense (8) (87) 95
  Cell Sites Total
Buildings and other Construction
equipment 19- Intangible assets
Cost
As of January 1, 2008 165 5,382 289 796 6,632
Licenses Goodwill Others Total
Additions 39 322 87 1,184 1,632
Cost  
Change in the scope of consolidation (3) 55 (11) (4) 37
As of January 1, 2009 1,861 1,227 274 3,362
Assets held for sale (3) (16) (3) (1) (23)
Additions - - 46 46
Disposals (6) (41) (6) (8) (61)
Change in the scope of consolidation 8 48 10 66
Currency translation differences (16) (682) (25) (87) (810)
Assets held for sale - (9) (34) (43)
Reclassifications 4 916 5 (925) -
Disposals - - (7) (7)
As of December 31, 2008 180 5,936 336 955 7,407
Currency translation differences (23) 5 (3) (21)
           
As of December 31, 2009 1,846 1,271 286 3,403
Accumulated Depreciation and
           
Impairment
As of January 1, 2008 44 1,628 148 9 1,829 Accumulated Amortization  
Charge for the year 23 686 63 - 772 As of January 1, 2009 724 121 134 979
Change in the scope of consolidation 1 26 (7) - 20 Charge for the year 114 - 43 157
Assets held for sale (1) (9) (2) - (12) Change in the scope of consolidation 1 - 1 2
Disposals (1) (29) (3) - (33) Assets held for sale - - (13) (13)
Impairment loss - - - 7 7 Impairment loss - 13 2 15
Currency translation differences (8) (208) (13) - (229) Currency translation differences (10) 1 11 2
As of December 31, 2008 58 2,094 186 16 2,354 As of December 31, 2009 829 135 178 1,142
             
Net book value as of December 31, 2007 121 3,754 141 787 4,803 Net book value as of December 31, 2008 1,137 1,106 140 2,383
Net book value as of December 31, 2008 122 3,842 150 939 5,053 Net book value as of December 31, 2009 1,017 1,136 108 2,261

Additions to property and equipment in 2009 mainly relate to cell Change in estimates Licenses Goodwill Others Total
site investments and assets under construction relating to new
base stations, predominantly in GSM companies in Pakistan, During the year ended 31 December 2009 the Group conducted an Cost  
Bangladesh and Algeria. Those investments are mainly due to the operational efficiency review at one of its subsidiaries As of January 1, 2008 1,701 1,173 200 3,074
expansion of the business, increased capacity and the change in Orascom Telecom Bangladesh Limited – which resulted in changes
to the expected useful life of certain items of cell site equipment. This Additions 252 - 44 296
GSM technology.
equipment which management previously intended to depreciate Change in the scope of consolidation 20 71 38 129
Property and equipment transferred to assets held for sale in 2009 over eight years of use, is now expected to remain in use for fifteen Assets held for sale (2) (17) (1) (20)
relates to the property and equipment of Link-Egypt and Link dot years from the date of acquisition. The effect of these changes on
depreciation expense, recognized in income statement, in current Disposals - - (7) (7)
net See Note 6 “Assets and liabilities classified as held for sale”
and future periods as follows: Currency translation differences (110) - - (110)
for further information.
As of December 31, 2008 1,861 1,227 274 3,362
Property and equipment pledged as security for bank borrowings  
amount to US$ 1.3 billion as of December 31, 2009 and primarily
Accumulated Amortization  
relate to securities for borrowings of PMCL, Trans World Associated
Private Limited (“TWA”) , Orascom Telecom Tunisie S.A.(“OTT”) As of January 1, 2008 614 120 115 849
and Telecel Namibia . Charge for the year 112 - 28 140
In the year ended December 31, 2009 and 2008 the Group
Change in the scope of consolidation 3 - - 3
capitalized borrowing costs of US$ 36 million and US$ 63 million,
respectively, relating to the acquisition of property and equipment. Disposals - - (1) (1)
Impairment loss 31 - 1 32
The Group leases various assets under non-cancelable finance
Currency translation differences (36) 1 (9) (44)
lease agreements. As of December 31, 2009 the Group had assets
under finance lease with cost of US$ 36 million and net book value As of December 31, 2008 724 121 134 979
of US$ 31 million mainly relating to a sale and lease back of the  
premises at Nile City Towers (headquarter offices in Cairo), as well
Net book value as of December 31, 2007 1,087 1,053 85 2,225
as minor finance leases for vehicles and equipment.
Net book value as of December 31, 2008 1,137 1,106 140 2,383
52

Additions to others in 2009 mainly relate to software licenses. minimum level at which the units are monitored for management outstanding under such loan agreements, including accrued Financial receivables as of December 31, 2008 also include an
control purposes. interest, was CAD 723 million (equivalent to US$ 696 million) , amount of US$ 165 million relating to receivables from the sale of
Additions to intangible assets in 2008 primarily relate to the the Group’s share of the excess losses of Globalive compared to subsidiaries. This primarily relates to the receivable from the sale
acquisition of a 3G license in Egypt, by Egyptian Company for The carrying amount as of December 31, 2009 was subject to an the carrying value of the investment have therefore been deducted of OrasInvest amounting to US$ 90 million, of which US$ 75 million
Mobile Services S.A.E. (“ECMS”) with a duration of 14 years impairment test to compare the carrying amount with value in use from the long term receivable. After considering the share of such was settled in December 2009 and the residual receivable of US$
validity, the group’s proportionate share is US$ 172 million and the and the recoverable amount. The goodwill of LinkDotNet Telecom losses the amount recorded in financial receivables is US$ 643 75 million from the sale of Iraqna which was settled during 2009.
acquisition of a WiMax License by PMCL. was impaired during the year prior to performing this test. After million. As of December 31, 2009, the residual receivable from the sale of
having considered this previous impairment, no further evidence OrasInvest of US$ 15 million is due to be settled in 2010.
Intangible assets pledged as security for bank borrowings amount of impairment arose. Value in use was determined by discounting
to US$ 1.3 billion and primarily relate to securities for borrowings the expected cash flows, resulting from business plans approved Derivative financial instruments
of PMCL and OTT. by the respective Board of Directors, using the post-tax weighted
average cost of capital (WACC) as the discount rate. 2009 2008
Impairment tests for goodwill Assets Liabilities Assets Liabilities
Goodwill is allocated to the individual CGU which reflects the    
Interest rate derivatives 1 99 - 112
The following table provides an analysis of goodwill by segment
Foreign exchange derivatives 134 - 178 -
Other derivative instruments 16 - 7 1
2009
Central
Total 151 99 185 113
and North
  Algeria Pakistan Egypt Tunisia Bangladesh Total
South Korea
Africa Less non-current portion
                Interest rate derivatives - 35 - 71
Foreign exchange derivatives 94 - 154 -
GSM 529 277 168 36 11 104 - 1,125
Other derivative instruments 15 - 6 -
Telecom Services - 1 2 - - - - 3
Current portion 42 64 25 42
Internet & Fixed Line - - 8 - - - - 8
529 278 178 36 11 104 - 1,136 Interest rate derivatives derivative are recognized in foreign exchange loss / gain in the
2008 income statement.
The notional principal amounts of the outstanding interest rate
Central swaps that qualify for hedge accounting amounts to US$ 1.5 billion, Other derivative instruments
and North relating to the A1 and A2 term loan supplements of the Company.
Algeria Pakistan Egypt Tunisia Bangladesh Total
South Korea Under the derivative contract the Company pays fixed interest rate Other derivative instruments mainly include the warrants to purchase
Africa and receives 6 month Libor. Gains and losses are recognized in shares of My Screen Mobile Inc and Lingo Media Corporation
the cash flow hedge reserve in equity. As of December 31, 2009 amounting to US$ 2 million and US$ 0.4 million, respectively as of
the fair value of the derivative liability was US$ 96 million. The December 31, 2009. The details of these warrants are provided
GSM 527 277 167 36 11 64 - 1,082 gain recognized in the cash flow hedge reserve, net of deferred below in the section “Financial assets available for sale”.
Telecom Services - 1 1 - - - - 2 tax during the year ended December 31, 2009, amounts to US$
Internet & Fixed Line - - 22 - - - - 22 25 million. In February 2009 the Company issued equity indexed notes with
527 278 190 36 11 64 - 1,106 a nominal amount of US$ 230 million which mature in 2013. The
Additionally, during 2009 the Company entered into a switchable notes have a redemption price on maturity which is indexed to the
20- Other financial assets interest rate swap for a notional amount of US$ 500 million to cover Company’s GDR price. This feature of the debt is considered as
a portion of the syndication loan. Under the derivative contract the an embedded derivative which is valued at fair value through profit
2009 2008 Company receives a 25 basis point reduction in the floating interest and loss. As of December 31, 2009 the fair value of this embedded
rate and at the end of the first year (September 23, 2010) the bank derivative asset was US$ 14 million.
Non-current Current Total Non-current Current Total has the right to either switch to a fixed rate swap (whereby the
      Company will pay fixed rate interest and receive floating) or switch CDC Fennec Ltd, a lender to Moga has the option to convert all
Financial receivables 676 21 697 416 170 586 to a floating rate with a cap (whereby the Company will pay floating amounts payable under the loan agreement into shares of the
Derivative financial instruments 109 42 151 160 25 185 rates up to a cap strike of 4.15%). As of December 31, 2009 the Company until the debt is extinguished. As of December 31, 2009
fair value of the derivative liability was US$ 3 million. The changes the amount due, recorded as liabilities to banks, amounted to US$
Deposits 41 14 55 43 82 125 in the fair value of the derivative are recognized in financial income 29 million. As of December 31, 2009 and 2008 the fair value of this
Financial assets held for trading - 32 32 - - - and expense in the income statement was US$ 1 million. option was zero.
Financial assets available for sale 19 5 24 20 - 20
845 114 959 639 277 916 Foreign exchange derivatives Deposits
Financial Receivables further amount of CAD 137 million was advanced under the original Foreign exchange derivatives primarily relate to the economic Deposits primarily relate to letters of guarantee and other restricted
loan agreements. hedge of PMCL. The cross currency swap relates to certain cash held as security for the performance of Group obligations.
As of December 31, 2008 and 2009 financial receivables mainly borrowings of PMCL, which are swapped from US$ to PKR and The decrease in deposits in 2009 mainly relates to the liquidation
relate to loans provided to Globalive Management Corp (“GWMC”), Globalive was awarded CAD 442 million of spectrum licenses in
from Euro to PKR, whilst the associated interest is swapped from of deposits in Algeria for the payments of the dividend and the tax
a subsidiary of Globalive (see Note 16 “Share of loss of associates March 2009 and the loans are secured on a subordinated basis
LIBOR to KIBOR and from Euribor to KIBOR. The changes in the appeal.
and gain on disposal of associates”). by an assignment of these licenses and are guaranteed on a non
fair value of the derivative are recognized in foreign exchange loss
recourse basis. / gain in the income statement. As of December 31, 2009 the fair Deposits with amounts of US$ 29.5 million are pledged or blocked
During 2008 the Company entered into two loan agreements with value of this derivative asset was US$ 125 million as security against related bank borrowings or others commitments.
Globalive Management Corp (“GWMC”, a subsidiary of Globalive) Globalive launched its wireless network to the Canadian market
to borrow an amount of up to CAD 508 million. Both loans are non- in December 2009 and is therefore in the start-up phase of
operations and has incurred losses to date. The Group’s share of Telecel Globe entered into a currency forward to hedge exposures The following table shows the ageing analysis of financial receivables
revolving term loans bearing interest of Libor plus 18%. In 2009 the to movements in Namibian Dollars in relation to the purchase price and long term deposits as of December 31, 2009 and 2008:
loan agreements were amended to increase the facility to CAD 608 these losses is in excess of the carrying value of the investment.
The loans provided to Globalive are long term loans and have to be paid for the investment in PowerCom Namibia. The final
million. As of December 31, 2008 the amount outstanding under installment of the purchase price was due to be paid in January
such loan agreements, including accrued interest, amounted to been considered to be a long-term interest forming part of the net
investment in Globalive. As of December 31, 2009 the amount 2010. As of December 31, 2009 the fair value of this derivative
CAD 483 million (equivalent to US$ 401 million). During 2009 a asset was US$ 9 million. The changes in the fair value of the
53

2009 2008 The movement of deferred tax assets and liabilities during the year, without taking into consideration any offsetting is provided in the tables
below:
Financial Financial
Deposits Deposits Depreciation
receivables receivables Tax Accrued Impairment Fair
Not past due 55 697 125 511 Deferred tax assets and Provisions Other Total
losses expense of assets value
amortization
Past due 0-30 days - - - -
- - - 75  
Past due 31-120 days
55 697 125 586 As of December 31, 2008 152 36 22 8 7 22 7 254
Charged / (credited) to the
74 5 (6) 2 - 1 3 79
Financial assets available for sale income statement
Charged directly to equity - - - - - (5) - (5)
Company name % ownership December 31, 2009 December 31, 2008 Change in scope 18 - - - - - - 18
    Exchange differences  (4) (1) - (1) - - (7) (13)
Smart Village (ECDMIV) 10% 8 8
As of December 31, 2009 240 40 16 9 7 18 3 333
My Screen Mobile Inc 9% 2 4
Lingo Media Corporation 23% 3 3 Depreciation and
Top Level Domain Co. 5% 1 1 Deferred tax liabilities Unremitted earnings Other Total
amortization
Other investments 10 4
 
24 20
As of December 31, 2008 335 80 8 423
My Screen Mobile Inc 21- Deferred taxes
Charged / (credited) to the income
17 (17) 33 33
In May 2008, the Company concluded a “Restricted Stock Purchase Deferred income tax assets and liabilities are offset when there is statement
Agreement” with My Screen Mobile Inc, an entity specializing in the a legally enforceable right to offset current tax assets and liabilities
delivery of advertising to mobile phones, to acquire 12.5 million and when the deferred income tax assets and liabilities relate to Exchange differences (26) (4) 5 (25)
shares which represents approximately 9% of the total share capital income taxes due to the same tax authority. The following table Change in scope (1) - - (1)
and existing voting rights. Additionally, the Company purchased provides a reconciliation of deferred tax assets and liabilities of the As of December 31, 2009 325 59 46 430
share warrants to acquire up to 20 million shares at an exercise Group to the amounts included in the face of the balance sheet.
price of US$ 2 per share. The warrants can be exercised from the Deferred tax assets on tax losses carry forwards mainly refer temporary differences related to accruals for provisions, due to
date of the agreement until May 23, 2012. The total purchase price 2009 2008 to income tax loss carry forwards of the Group’s subsidiaries in uncertainties in connection with the tax treatment of such expenses,
of the shares and warrants was US$ 10 million. Upon exercise of Pakistan with no expiry date. as they might be challenged by local tax authorities.
the warrants, the Company would hold approximately 20% of the Deferred tax liabilities,
existing and potential voting rights. Based on an assessment of gross 430 423
No deferred tax assets were recognized on income tax loss No liability has been recognized in respect of temporary
the potential ownership percentage and other contractual rights, carryforwards for some foreign subsidiaries, mainly Orascom differences associated with investments in subsidiaries, branches
Deferred tax assets
management does not consider that it has significant influence over Telecom Bangladesh Limited (“OTB”) and CAT, as it is currently and associates and interests in joint ventures, where the Group is
the company. Therefore, the investment has been recorded as a offset (214) (166)
not probable that taxable profit will be available in the near future in a position to control the timing of the reversal of the temporary
financial asset available for sale and measured at fair value. As of Deferred tax liabilities 216 257 against which such tax loss carryforwards might be utilized. differences and it is probable that such differences will not reverse
December 31, 2009 the fair value of the investment amounted to in the foreseeable future.
US$ 2 million and the fair value of the warrant amounted to US$ Deferred tax assets,
Generally the Group does not recognize deferred tax assets for
2 million. gross 333 254
Deferred tax liabilities The following table provides a breakdown by estimated
Lingo Media Corporation recoverability of recognized deferred tax assets and liabilities:
offset (214) (166)
In August 2008, the Company entered into a subscription Deferred tax assets 119 88 Deferred tax liabilities Deferred tax assets
agreement to acquire 2,857,143 common shares of Lingo Media of which recognized
Corporation, a media entity focusing on online advertising. The 2009 2008 2009 2008
directly in equity 5 (22)
investment represents approximately 23% of the total share within 1 year 14 50 6 1
capital and existing voting rights. The Company also purchased The movement in the deferred income tax account is as follows: within 1 - 5 years 243 339 327 252
share warrants to acquire up to 2,142,857 shares of this entity.
The warrants can be exercised from the date of the agreement after 5 years 173 34 - 1
for a period of two years, at an increasing price from US$4 up to 2009 2008
430 423 333 254
US$8. The total purchase price of the shares and warrants was As of January 1, 169 250
US$ 5 million. Assuming exercise of the warrants, the Company Exchange differences (12) (42) 22- Trade receivable
would have an interest of approximately 34% in this entity. Based Change in scope (19) 7
on an assessment of the contractual rights, management does
not consider that it has significant influence over the company. Income statement charge (24) 2009 2008
(46)
Therefore, the investment has been recorded as a financial asset Tax charged directly to Receivables due from
5 (22) 177 165
available for sale and measured at fair value. As of December 31, equity customers
2009, the fair value of the investment amounted to US$ 3 million Receivables due from
As of December 31, 97 169 98 91
and the fair value of the warrants, which is recorded in derivative telephone operators
financial assets, amounted to US$ 0.4 million.
Accrued revenue (unbilled) 79 76
Financial assets held for trading Receivables due from
12 17
authorized dealers
Financial assets held for trading relate to government treasury bills Other trade receivables 50 46
and investment bonds purchased by PMCL. Allowance for doubtful
(84) (67)
receivables
Total 332 328
54

The following table shows the movement in the allowance for 24- Cash and cash equivalents as payment of the dividend ; and Share based compensation plan
doubtful receivables • during the year ended December 31, 2009 the Company
2009 2008 also purchased the equivalent of 7,240,310 local shares As of December 31, 2008 the Company had 3,661,785 shares which
2009 2008 from the market to be held as treasury shares and sold the were held for the purposes of the share based compensation plan.
Bank accounts 413 580 equivalent of 4,450,380 local shares to the market. During the year ended December 31, 2009 the Group acquired
At January 1 67 87 Deposits 344 70 1,235,735 of its own shares for the purposes of the share based
Exchange differences (1) (6) Cash on hand 3 2 As a result of the above transactions there were no treasury shares compensation. Share grants exercised during 2009 resulted in
Additions (allowances as of December 31, 2009. 950,220 shares.
Total 760 652 As a result of the above transactions, as of December 31, 2009 the
recognized as an 39 19
expense) Cash and cash equivalents as of December 31, 2009 were Company had 3,947,300 shares held as treasury shares for the
Change in scope (5) - unusually high mainly due to undistributed dividends at Orascom purposes of the share based compensation plan. The fair market
telecom Algeria “OTA” and Mobinil amounted to US$ 243 million . value of such shares was US$ 91 million.
Use (11) (13) 26- Borrowings
Reversal (5) (2) Deposits includes an amount of DZD 10,201M equivalent to US$
Reclassifications - (18) 140 million representing the remaining agreed amount not to be
repatriated until the Algerian tax authority “DGE” issue a clearance within one after 5
At December 31, 84 67 1-2 years 2-3 years 3-4 years 4-5 years Total
certificate in relation to the tax position of OTA (see note 35). year years

25- Share Capital As of December 31, 2009

The following table shows the ageing analysis of trade receivables
as of December 31, 2009 and 2008, net of the relevant As of December 31, 2008
provision for doubtful receivables: Authorized and issued share capital and legal reserves

As of December 31, 2008 the issued and fully paid share capital Liabilities to banks 838 830 972 1,655 160 20 4,475
2009 2008 amounted to L.E. 899 million (equivalent US$ 261 million)
432 468 746 945 1,620 210 4,421
Not past due 123 154 comprising 899,402,874 shares of a nominal value of L.E. 1 per
Past due 0-30 days 86 71 share. The Company is listed on the Egyptian Stock Exchange
and also has GDRs (where one GDR is equivalent to 5 local Bonds 76 13 197 230 739 - 1,255
Past due 31-120 days 81 64 shares) listed on the London Stock Exchange. 35 51 14 63 253 737 1,153
Past due 121 - 150 days 4 9
Past due more than 150 On October 22, 2009, the Extraordinary General Meeting approved
38 30 Derivative instruments 64 32 4 (1) - - 99
days a share capital reduction through the cancellation of 10,302,769
treasury shares (856,624 local shares and 1,889,229 GDRs) 42 36 23 11 1 - 113
Trade receivables 332 328
amounting to US$ 76 million.
Finance lease liability 4 3 3 2 2 10 24
The legal reserve connected with the cancelled shares including
The maximum exposure to credit risk at the reporting date is the currency translation differences was reclassified from other 8 8 7 6 4 - 33
carrying value of the receivable. The Group does not hold any reserves to retained earnings.
collateral as security. Other borrowings 16 - 3 - - - 19
Accordingly, as a result of the above transactions, as of December 13 - - - 2 - 15
23- Other current assets 31, 2009 the issued and paid up share capital amounted to LE 889
million (equivalent to US$ 258 million) comprising 889,100,105 Total as of December 31, 2009 998 878 1,179 1,886 901 30 5,872
2009 2008 shares of a nominal value of LE 1 per share.
Prepaid expenses 82 76 Total as of December 31, 2008 530 563 790 1,025 1,880 947 5,735
Advances to suppliers 12 16 Dividends
Liabilities to banks Bonds
Receivables due from tax
185 15 The shareholder’s meeting of the Company held on June 7, 2009
authority Appendix A includes a detailed analysis of liabilities to banks as of Appendix B includes a detailed analysis of Bonds as of December
Deferred cost - 14 approved a dividend distribution of LE 1 per share in the form of
cash and/or shares. Based on the announced distribution ratio of December 31, 2009. 31, 2009. Changes in bond liabilities during 2009 primarily relate
Other receivables 141 172 36:1; on August 27, 2009 the Company distributed 243,376 shares to the repurchase by PMCL of a portion of its Senior Notes and
Allowance for doubtful to local shareholders and 1,985,097 shares to the GDR holders In addition to the normal scheduled repayments of borrowing the issuance of an equity indexed bond Orascom Telecom Oscar
(49) (46) facilities, in accordance with the relevant agreements, various Luxembourg (the “Oscar Bond”).
current assets (equivalent to 9,925,487 local shares).
Group companies (mainly OTH, PMCL, ECMS and Bangladesh)
Total 371 247 entered into new borrowings during the year in order to finance Pakistan Mobile Communication Limited
Consequently, the Company distributed in cash an amount of
LE 180 million for a total number of local shares of 180,111,604 license payments, ongoing operations and capital expenditure
(EGP 1/share) and an amount of US$ 60 million for a total number programs. In May 2009 PMCL completed a tender offer to repurchase a
The increase in receivables due from tax authority is mainly related portion of its 8 5/8% Senior Notes amounting US $ 250 million
to down payments against the tax claim received by OTA covering of 66,337,438 GDRs (equivalent to 331,687,192 local shares)
(around US$ 0.9022/GDR). Pakistan Mobile Communication Limited due 2013. PMCL repurchased the notes at a repurchase price
the years 2004-2007. of US$730 per US$1,000 of principal amount. As a result of the
The dividend distribution in 2008 amounted to LE 1 per share (LE PMCL entered into a syndicate loan agreement with Pakistani transaction PMCL cancelled debt of approximately US$ 138 million
The following table shows the movement in the allowance for other banks for a facility amounting to PKR 5.1 billion equivalent to US$ for cash consideration of US$ 101 million.
current assets: 5 per GDR) and was paid in cash on June 5, 2008.
61 million dealing with standard chartered bank Pakistan as the
2009 2008 Treasury shares agent, repayments of principal amount starts from November 9, Orascom Telecom Oscar
2010 and the financing period will last for 4 years.
At January 1 46 27 In February 2009 the Oscar Bond was issued with a nominal
As of December 31, 2008 the Company had 17,681,700 shares
Exchange differences - (1) which were held as treasury shares, during 2009 the following In addition, during the 2009, OTH and some of its subsidiaries amount of US$ 230 million maturing in 2013, through a fully
Additions (allowances movements took place: obtained new short term facilities. As in OTH obtained a nominal subscribed private placement. The notes carry a coupon of US$
5 2 of US$ 140 million. Libor plus a margin of 500bps and rank pari-passu to the existing
recognized as an expense)
Reclassifications (2) 18 • as previously explained, the Company cancelled 10,302,769 US$2.5bn senior secured credit facility with accession to the
treasury shares on October 22, 2009 (comprising 856,624 security pool under the Security Share Agreement. The notes have
At December 31, 49 46
local shares and 1,889,229 GDRs) and distributed the a redemption price at maturity indexed to Orascom Telecom’s GDR
equivalent of 10,168,861 local shares from treasury stock which may potentially allow the Group to further reduce financing
55

costs of the notes. During 2009 the Company entered into a sale and leaseback 27- Other liabilities
agreement in relation to the headquarter premises at Nile City
Derivatives Towers in Cairo. The Company sold the building with a net book 2009 2008
value of US$ 10 million for an amount of US$ 25 million. The
Details of the derivative liabilities are provided in Note 20 “Other Company will lease back the premises under a finance lease for a Current Non-current Total Current Non-current Total
financial assets”. period of 8 years and has the option to repurchase the building at      
the end of the lease for an amount of US$ 13 million. The gain of Telecommunication license payable 283 80 363 202 193 395
Finance lease liabilities US$ 15 million is recorded in deferred income and will be released
over the life of the finance lease. Taxes (Other than income taxes) 228 - 228 190 - 190
2009 2008 *Prepaid Traffic and deferred income 237 - 237 187 - 187
Gross finance lease liabilities – Other Borrowings Due to local authorities 130 - 130 62 - 62
   
minimum lease payments Personnel payables 77 - 77 53 - 53
Other borrowings mainly include promissory notes and loans from
Within one year 5 12 non-controlling shareholders in subsidiaries. Other 136 41 177 162 27 189
Between 1-5 years 15 31 Total 1,091 121 1,212 856 220 1,076
After 5 years 22 -
* On July 16, 2009 Middle East and North Africa Submarine Under this agreement GBI should pay a milestone payments against
42 43 Cable Systems – MENA Cable (fully owned subsidiary) signed an a commitment from MENA Cable to fulfill certain conditions. As of
Future finance charges on finance agreement with Gulf Bridge International –GBI to sell fiber pair and the date of the financials the amounts received from GBI amounted
(18) (10) Indefeasible Right of Use (IRU) in an amount of US$ 97 million. to US$ 29 million recorded as a deferred income.
leases
Present value of finance lease 28- Trade payables
24 33
liabilities
2009 2008 2009 2008
The present value of finance lease        
liabilities is as follows: Capex payables 470 654 Profit attributable to equity holders of
318 431
the Company (in millions of US$)
Within one year 4 8 Trade payables due to suppliers 269 260
Between 1-5 years 10 25 Trade payables to telephone Weighted average number of shares in
97 74 878 937
operators issue (in millions of shares)
After 5 years 10 - Adjustments for:  
24 33 Other trade payables 207 198
- Shares granted (in millions of shares) 4 2
Total 1,043 1,186 Weighted average number of shares
Currency Information of Egyptian Pakistan Bangladeshi Algerian Tunisian for diluted earnings per share (in Million 882 939
US$ Euro Others Total Trade payables are all due within one year.
Borrowings Pound Rupee Taka Dinar Dinar of shares)
As of December 31, 2009 29- Earnings per share Earnings per share – diluted (in US$) 0.36 0.46
Total borrowings by currency of
4,232 361 483 575 102 27 37 55 5,872 (a) Basic 30- Business combinations
issue
Notional amount of currency Basic earnings per share is calculated by dividing the profit During 2009 the Group acquired 100% of share capital of Power-
(178) (276) - 454 - - - - - COM (Cell One) in Namibia, a GSM telecommunications operator
derivatives attributable to equity holders of the Company by the weighted
average number of ordinary shares outstanding during the year, in Namibia through its subsidiary Telecel Globe, for a cash
Borrowings after derivative effect 4,054 85 483 1,029 102 27 37 55 5,872 consideration of US$ 60 million. The acquired business contributed
excluding ordinary shares purchased by the Company and
of which (after derivative effect): held as treasury shares or for the purposes of the share based revenues of US$ 14 million and net loss of US$ 19 million to the
floating rate borrowings 1,663 83 402 1,029 102 27 36 - 3,342 compensation. Group in the period since acquisition.
fixed rate borrowings 2,391 2 81 - - - 1 55 2,530 2009 2008 The purchase price for this acquisition was US$ 60 million of which
As of December 31, 2008 US$ 30 million was paid during 2009 and the remaining portion will
    be paid in 2010. The purchase price allocation was finalized on
Total borrowings by currency of Profit attributable to equity holders of December 2009.
4,022 421 539 576 61 52 55 9 5,735 318 431
issue the Company (in million of US$)
Notional amount of currency Weighted average number of shares
(315) (305) - 620 - - - - - 878 937
derivatives (in millions of shares)
Borrowings after derivative effect 3,707 116 539 1,196 61 52 55 9 5,735
Earnings per share – basic (in
of which (after derivative effect): 0.36 0.46
US$)
floating rate borrowings 1,110 108 458 1,195 61 52 53 - 3,037
fixed rate borrowings 2,597 8 81 1 - - 2 9 2,698 (b) Diluted

Financial liabilities include secured liabilities of US$ 4,091 million
as of December 31, 2009 and US$ 3,897 million as of December
31, 2008. In general, the financial liabilities are secured on property
and equipment of the relevant subsidiary, pledged shares and
receivables.
Diluted earnings per share is calculated by adjusting the weighted
average number of ordinary shares outstanding to assume
conversion of all dilutive potential ordinary shares. During 2008
and 2009 the dilutive potential ordinary shares relate to the share
based compensation plan.
56

The following table provides details of this acquisition Orascom Telecom Tunisia S.A. (“OTT”) 33- Share based compensation

  Cell One OTT operates a GSM network in Tunisia and provides a range of The following table provides a summary of the Company’s existing Executive Share Option Plans (ESOP), not expired as of December 31,
pre-paid and postpaid voice and data telecommunication services 2009:
Cash and cash equivalents - under the brand name “Tunisiana”. The Company has a 50%
Property and equipment 31 shareholding in OTT through two wholly-owned subsidiaries which Fair value
Intangible assets 15 own 35% and 15% of the shares in OTT. The remaining 50% GDRs Vesting Contractual GDR price at GDR market
of GDRs at
interest is held by National Mobile Telecommunications Company Grant date Tranche granted period term grant date in price at grant
Deferred tax assets 17 grant date in
KSC which is owned by Qatar Telecom. (thousands) (months) (months) US$ date in US $
Inventories 1 US$
Trade receivables 3 Consortium Algerian Telecommunication S.P.A. “CAT)
Other current assets 1 July 1, 2004 3 4 42 66 9.20 9.29 4.79
CAT was formerly a landline operator in Algeria which ceased
Non-current borrowings (32) operations during the period. The current intention of the July 1, 2005 2 20 30 54 - 50.70 49.20
Other non-current liabilities (6) management of CAT is to liquidate this company. Therefore the July 1, 2005 3 2 42 66 - 50.70 48.71
Group has fully written down all assets relating to this business. July 1, 2006 3 31 42 66 - 40.80 39.20
Trade payables (15)
  The following amounts represent the assets, liabilities, revenues January 1, 2007 2 7 24 48 - 66.00 62.98
Net identifiable assets acquired 15 and profit for the year of the joint ventures. They are included in the January 1, 2007 3 35 36 60 - 66.00 62.36
balance sheet and income statement of the Group’s consolidated
Goodwill 45 July 1, 2007 1 9 18 42 - 64.90 63.61
financial statements according to its shareholding in each joint
Purchase price 60 venture. July 1, 2007 2 44 30 54 - 64.90 62.98
Cash and cash equivalents in subsidiary July 1, 2007 3 36 42 66 - 64.90 62.36
- 2009 2008
acquired
    January 1, 2008 2 21 24 48 - 83.00 79.07
Cash outflow on acquisition 60 Revenues 2,651 2,554
January 1, 2008 3 22 36 60 - 83.00 78.19
In the third quarter of 2009 the purchase price allocation was Profit for the year 501 247
July 1, 2008 1 8 18 42 - 62.90 60.81
finalized for the acquisition of U-com Burundi SA and Telecel Current assets 563 476
Afrique SA which were purchased in July 2008. The comparative Non-current assets 2,980 2,867 July 1, 2008 2 18 30 54 - 62.90 59.84
amounts for 2008 were restated compared to those reported in the Current liabilities 1,641 1,324 July 1, 2008 3 14 42 66 - 62.90 58.90
2008 annual consolidated financial statements as follows:
Non-current liabilities 991 1,337 January 1, 2009 1 314 12 36 - 27.29 26.39
  January 1, 2009 2 50 24 48 - 27.29 25.44
December December
PPA 32- Commitments
31, 2008 (as 31, 2008 January 1, 2009 3 50 36 60 - 27.29 24.53
adjustment
reported) (adjusted) July 1, 2009 1 4 18 42 - 28.40 26.25
The commitments as of December 31, 2009 and 2008 are provided
Property and in the table below: July 1, 2009 2 15 30 54 - 28.40 25.18
5,057 (4) 5,053
equipment
July 1, 2009 3 23 42 66 - 28.40 24.41
Intangible assets 2,371 12 2,383 As of As of
December December
Deferred tax 31, 2009 31, 2008 The ESOP was introduced in 2003 and the Company since then vesting periods that vary from 12 to 42 months. Starting from 2005
249 8 257
liabilities uses treasury shares bought from the market to cover the plan. GDRs are granted for free and must be exercised within two years
The Board of Directors of the Company has appointed a Committee after the end of the vesting period. Exercise of an award is subject
31- Interest in joint ventures Intangible assets 136 138 that can grant GDR options or GDRs to employees of the Company to employment in the Group at the exercise date. The Group has
Property and equipment 205 338 and its subsidiaries through Orascom Telecom ESOP Limited., no legal obligation to repurchase or settle the awards in cash.
The Group has the following interest in its joint ventures: Malta, a wholly owned subsidiary. Such GDRs of the Company are
Others - 109
Total 341 585 listed on the London Stock Exchange and denominated in US$. GDRs were valued using the Black-Scholes option-pricing model.
Country of Awards under the ESOP are generally reserved for employees at The assumptions for calculations of the fair value per GDR at the
Joint venture Shareholding Commitments for the purchase of intangible assets mainly relate a senior management level and above that have spent at least one grant date include the GDR price at each grant date, nil exercise
domiciliation to commitments of Egyptian Company for Mobile and Service full year of services in the Company and that have a satisfactory price, a GDR price volatility between 29.0% and 72.6%, a dividend
amounting to US$ 108.4 million primarily relating to costs connected performance according to their appraisal reports. The Company yield of between 1% and 3.5% and an annual risk free rate between
Egyptian Company for Mobile
34.67% Egypt with the 3G license.. has made annual grants on July 1 each year since 2003; from 2007 1.7% and 6.4%.
Services S.A.E.
onwards additional GDRs were granted on January 1 to existing
Orascom Telecom Tunisia S.A. 50.00% Tunisia Commitments for purchase of property and equipment mainly employees. The GDRs granted vest in three installments over the
Consortium Algerian relate to commitments of Mena cable amounting to US$ 84 million
50.00% Algeria relating to the purchase of marine cables and related equipment
Telecommunication S.P.A.
and US$ 60 million for Egyptian Company for Mobile and Service
Egyptian Company for Mobile Services S.A.E. (“ECMS”) relating to the purchase of equipment.

ECMS is a mobile telecommunication operator in Egypt and The following table provides the future aggregate minimum lease
provides a range of prepaid and postpaid voice and data payments under non-cancellable operating leases:
telecommunication services under the brand name of Mobinil. The
2009 2008
Company has an investment of 34.67% in ECMS and the France
Telecom Group also has an investment of 36.34%. The remaining
shareholding is publicly traded on the Cairo and Alexandria Stock Within one year 39 27
Exchange. Between 1-5 years 151 117
Legal proceedings are currently in progress relating to a After 5 years 15 41
disagreement regarding the Shareholders Agreement entered into 205 185
by the Company and France Telecom, Further details are included
in Note 32 “Commitments”.
57

The following table provides a breakdown of the movements of outstanding GDR options and GDRs granted and their weighted average The main related party transactions are summarized as follows:
exercise price:
Sale of services and Purchase of services
  2009 2008   Interest income
goods and goods
Average Average   2009 2008 2009 2008 2009 2008
exercise price GDRs granted exercise price GDRs granted
GDR options GDR options Weather Investments Group            
  in US$ per for free in US$ per for free
(thousands) (thousands) Weather Investments 12 12 -  - -  -
GDR option (thousands) GDR option (thousands)
granted granted Wind Telecomunicazioni SpA 3 36 1 6 -  -
At January 1 9.20 4 504 9.20 80 478 WIS sarl 78 -  65 -  -  - 
Granted 467 - - 140 Joint ventures            
Forfeited (90) - - (6) ECMS 8 3 - - -  -
Exercised 9.20 (158) 9.20 (76) (108)
Expired - - - OTT 4 17 - 37 -  -
  Associate            
At December 31 - 4 723 9.20 4 504
GWMC -  - -  - 32 9
thereof exercisable - 4 198 4 20
Other related parties            
The weighted average GDR price during 2009 amounted to US$ The following table details the range of exercise prices and the Orascom Construction Industries -  - 2 3 -  -
25.14 (2008; US$ 48.65). weighted average remaining contractual life of outstanding awards
as of December 31, 2009 and 2008: Summit Technology (Orascom Technology Solution) -  - 7 5 -  -

  December 31, 2009 December 31, 2008 Orascom Trading -  - 12 10 -  -

Weighted Weighted Weighted Weighted Contrack facilities management - - 1 - - -
Number Number
Range of exercise average average average average
of GDRs of GDRs Orascom Training & Technology -  - - 3 -  -
price in US$ exercise price remaining life exercise price remaining life
(thousands) (thousands)
in US$ in months in US$ in months Total 105 68 88 64 32 9

9.20 9.20 4 - 9.20 4 12   Receivables Payables

Nil Nil 723 29 Nil 504 36   2009 2008 2009 2008
Weather Investments Group        
The table below sets forth the awards outstanding as of December 31, 2009 and their expiry dates:
Weather Investments 5 14 - 1
Exercise price in US$ GDRs (thousands) Wind Telecomunicazioni SpA 1 6 4 4
Expiry date - December 31
per GDR 2009 2008 WIS sarl 26 -  16 - 
  Rain Srl 1 -  2 - 
2010 0 - 9.20 24 179
Joint ventures        
2011 - 18 180
ECMS 1 5 - 1
2012 - 453 100
2013 - 130 25 OTT - 2 - 5
2014 - 79 - Associate        
2015 - 23 - GWMC 643 401 -  -
Total   727 484
Other related parties        
Telecel Globe Limited  established a share option programme that 34- Related party transactions Orascom Construction Industries -  - -  1
entitles two key management personnel to purchase shares in the Summit Technology (Orascom Technology Solution) 1 1 1 1
Company. In accordance with this programme, the employees are Transactions with subsidiaries, associates, with the Parent
being granted an option to purchase all of the “Option Shares” Company and its subsidiaries and other related parties are not Orascom Trading -  - 1 2
in consideration of the payment of USD1.  The Option shares considered atypical or unusual, as they fall within the Group’s Total 678 429 24 15
represent the number of shares, at a nominal value of USD1 normal course of business and are conducted under market
each, in the capital of the Company which shall be equivalent to conditions that would be performed by independent third parties.
3% of the capital of the Company calculated immediately upon its Transactions with Weather Investments Group million. Following the acquisition the name was changed to WIS
capitalization by an amount of USD50,000,000.  Based on these sarl. Transactions with M-Link since the sale are disclosed in the
terms, the value of both options amounts to USD1,500,000 for The Group is directly controlled by Weather Investments. line “WIS Sarl”.
each employee respectively.  The fair value of the two options at Transactions with Weather Investments and its subsidiaries
grant date is, therefore, equivalent to USD3,000,000, to be settled mainly relate to management fees charged by the Company and Transactions with Joint Ventures of the Group
in shares. interconnection traffic between the Group and the subsidiaries of
Weather Investments, and particularly Wind Telecomunicazioni Transactions with joint ventures of the Group mainly refer to
During 2009, both employees have exercised their respective
SpA. transactions with OTT and ECMS relating to interconnection traffic
share options. In order to satisfy these options, Telecel Globe
Limited would buy 3,000,000 shares at a nominal value of USD1 and the sale of handsets.
In addition to the information presented above, in January 2009 the
each, currently held by Orascom Telecom Holding and deliver Company sold its investment in M-Link to TLC SERVIZI S.p.A now Transactions with Associates of the Group
them to these employees in accordance with the share option (Wind International Services S.p.A.), a wholly owned subsidiary of
plan. Accordingly, the percentage of ownership of the Company in Wind Telecomunicazioni S.p.A for a cash consideration of US$ 78 OTH provided financing to GWMC, an associate of the Group,
Telecel Globe Limited was diluted by 6% . 
58
in connection with the funding of the acquisition of the spectrum
licenses. For further details see Note 20 “Other financial assets”.
Transactions with other related parties
The Group is indirectly controlled by the Sawiris family.
Transactions with entities under the control of the Sawiris family
mainly refer to transactions with Orascom Construction Industries,
Orascom Technology Solutions, Orascom Trading and Orascom
Training & Technology.
Transactions with Orascom Technology Solutions mainly refer to
maintenance activities of electronic hardware and software carried
out for the Group. Orascom Construction Industries and Orascom
Trading mainly provide maintenance and construction services
for the buildings the Group is working in, whereas transactions
with Orascom Training & Technology mainly include management
training programs.
A balance of US$ 6 million is outstanding from one member of the
board of directors and this amount will be settled against his ESOP
plan entitlements on exercise and vested.
Key management compensation
Key management includes executive and non executive directors
of the Board of Directors of the Company, the Company’s chief
financial officer, other managing directors considered key personnel
and the chief executive officers of significant subsidiaries and joint
ventures.
The compensation paid or payable to key management for
employee services is shown below:
  2009 2008
     
Salaries and other short-term employee
11 11
benefits
Equity settled share based payments 9 2
35- Contingent assets and liabilities
The Group is subject to various legal proceedings and claims
which arise in the ordinary course of business due to the nature of
the operations of the Group and the nature of the markets where
the Group operates.
The Group recognizes a provision for losses and liabilities when
the existence is certain or probable. As of December 31, 2009
the Company is a party in a number of legal cases which resulted
from carrying out its activities. Based on the legal advice obtained,
the Company’s management believe that the outcome of these
lawsuits, individually or in aggregate, would not be material to the
Group’s results.
PMCL tax claims
PMCL is involved in proceedings regarding tax claims up to the
year 2007 whereby the tax authorities conducted assessments
by curtailing expenditure claimed by PMCL. PMCL has a tax
claims up to the year 2007 that the tax authorities either framed
or assessed. However, the company has field appeals to the
appellate authorities against the re-assessment orders. The
disputed demand against the assessments framed/aggregates
to Rs 1,921 million equivalent to US$ 22.8 million .The company
has made a provision a provision for such assessments with an
amount of Rs 163 million equivalent to US$ 1.82 million.
OTA tax claims
OTA has received a final tax assessment relating to 2004 tax year
amounted to DZD 3,948 million equivalent to US$ 54.3 million. OTA filed
an appeal after the payment of 20% of final tax assessment. In January
2010 OTA received a refusal of its appeal and OTA has 4 months from
date of receipt to make a further appeal. A provision with an amount of
DZD 709 million equivalent to US$ 9.8 million was accounted for.
In November 2009, OTA received a final tax assessment for 2005
to 2007, amounting to 43,910 M DZD equivalent to US$ 603.7
million. Approximately 85% of the assessed amount is due to a
rejection of OTA’s accounts by the DGE (Tax Department for Large
Scale Companies). OTA has appealed the assessment after the
payment of 20% of the assessed amount.
OTA accrued a provision of 2,957 M DZD equivalent to Euro 28.3
million, equivalent to US $ 41 million, relying on an external expert
report. The external expert’s report considers that the DGE’s
rejection of the accounts
On March 7, 2010 OTA received a notice of the rejection of its
administrative appeal filed on December 2009. In order to file
a second appeal, OTA is required to pay a further 20% of the
remaining outstanding balance of the taxes and penalties assessed
by the DGE, this amounts to approximately $110 million and willbe
paid by OTA from its own resources.
Fastlink Jordanian tax dispute:
The Jordanian Tax Authority claims JD 49.2 million (approximately
US$ 69.39 million)for income tax allegedly due from Pioneer
Investment Ltd. (a wholly owned subsidiary of the Company)
in connection with the sale of Fastlink (Jordan Mobile
Telecommunication Services) to MTC in 2002 . Pioneer has
claimed that the tax assessment is without foundation.
Orascom Telecom Iraq Disposal Warranties
Orascom Telecom Iraq upon the disposal of its investment in (Iraqna
for Mobile Services-subsidiary) the company provided warranty to
the purchaser of the investment. This warranty, which in respect of
tax covenant claims, of which no more than USD 60 million equivalent
41.8 million Euro shall be payable in relation to tax covenant claim.
Dispute with France Telecom (and subsidiaries) regarding Mobinil:
France Telecom (and subsidiaries) has been in a dispute with
the Company regarding the shareholders agreement for Mobinil
and this dispute was subject to ICC arbitration. An award was
issued by the ICC on March 10, 2009 (the “Award”) and it is the
Company’s position, relying on legal advice, that the deadline for
concluding the sale ordered by the Award has time-expired as a
matter of Egyptian law in light of the failure of France Telecom’s
(or subsidiaries thereof) to conclude the sale during the 30 day
period stipulated in the Award. OTH Management cannot currently
estimate any financial impact that this dispute might have on the
financial statements of the Company
Telecom Egypt Interconnection Prices
Telecom Egypt filed a complaint with the dispute resolution
committee of the National Telecommunication Regulatory Authority
(NTRA), with the purpose of changing its interconnect prices with
the mobile operators, with which it has existing contracts. ECMS
filed a complaint requesting that the existing effective contract
between ECMS and Telecom Egypt be honored. The NTRA issued
a ruling on the dispute on September 3, 2008 in favor of Telecom
Egypt by changing the interconnect prices between the fixed and
mobile networks to be effective from that date.
ECMS informed the NTRA that it objects to the decision as it has
no legal or contractual basis and that we intend to bring the matter
to the courts in order to protect our interest. On November 01,
2008 a law suit against the NTRA was filed in the Administrative
Court at the State Counsel asking that the NTRA’s decision be
stayed or nullified.
On September 3, 2009 and based on the interconnect agreement,
ECMS filed an arbitration proceeding against Telecom Egypt
according to the rules of The Cairo Regional Center for
International Commercial Arbitration in order to settle the existing
dispute between the two parties. On October 9, 2009 Telecom
Egypt sent an initial response and a counterparty claim related to
the arbitration notification filed against it.
On January 5, 2010 a letter from NTRA was received with the
purpose of making new changes in the interconnect prices
between the different operators to be applied retroactively from
September 1, 2009. The letter was based on the September 03,
2008 decision. On January 14, 2010 ECMS sent a letter to NTRA
refusing this decision.
ECMS considers that it has a strong legal position and continues
to record interconnect revenue and costs based on the existing
agreement with Telecom Egypt and other mobile operators.
If ECMS applied the NTRA decisions it would have reported less
interconnect revenue the group proportionate share amounts to
EGP 49 equivalent to US$ 9M, less interconnect cost the group
proportionate share amounts to EGP 17M equivalent to US$3
M, for the financial year ended December 31, 2008 and less
interconnect revenue the group proportionate share amounts to
EGP 168M equivalent to US$ 30.5 M and less interconnect cost
the group proportionate share amounts to EGP 40M equivalents to
US$ 7.3M for the financial year ended December 31, 2009.
Intouch tax claims
Mobizone Algeria received a tax claim amounting to DZD 204
million in addition to penalties and default interest amounting to
DZD 51 million (equivalent to US$ 3.5 million). On January, 2009
Mobizone Algeria paid 20% of the total tax claim in order to appeal
. The tax disclosure in Mobizone Algeria’s audited financials for
the period ended Dec. 31, 2009 mentioned that the company
was granted a tax exemption amounting DZD205 Million and the
remaining amount of DZD 51 million was recorded as a provision.
Letters of credit and guarantees
The Group has provided guarantees and letters of credit in the
ordinary course of business of the Group’s activities. Guarantees
include the following:
- Letters of guarantee provided by ECMS to National Telecom
Regulatory Authority. The Company’s share in such letters of
guarantee is equal to L.E 54.1 million equivalents to US$ 9.8
million.
- Letters of guarantee provided by Ring Egypt to suppliers’ .The
Company’s share in letters of guarantee is L.E 65.45 million
equivalents to US$ 11.8 million.
- Letter of Guarantee amounting to US$ 1 million in favor
of NTRA to guarantee MENA Cable execution of its entire
obligation related to constructing, operating and renting
sea cables networks and its infrastructure for international
communications.
- Letter of guarantee in a favor of Lebanon Ministry of
Telecommunication (ROL) to guarantee OTH in the payment
of any amount due by the selected Participant to ROL amount
with US$ 30 million.
- Guarantee provided by Orascom Telecom Bangladesh in favor
of Ministry of Post & Telecommunication, the Chief Controller
of Exports and Imports and Power development board existed
of BDT 99 million equivalents to L.E 7.83million equivalent US$
1.42 million.
36- Subsequent events
Share transactions
The Extra-ordinary General Assembly of the Company on
December 27, 2009, delegated the Board of Directors members
to proceed with all necessary legal procedures to increase the
authorized capital from LE. 2.5 billion to LE. 7.5 billion and
authorized a rights issue to further strengthen the balance
sheet and ensure the Company’s liquidity. On January 13,
2010 in accordance with the Egyptian Financial Supervisory
Authority’s (“EFSA”) requirements, OTH published a Public
Subscription Notice in connection with the rights issue and in
March 2010 the Company issued 4,356,590,515 new shares
at the nominal price of LE. 1 per share, to raise a total of LE.
4,356,590,515 or approximately US$800 million (without
issuing fees).
Financing
Egyptian mobile telephone operator Egyptian Company for
Mobile Services (ECMS) issued 1.5 billion Egyptian pounds
($273.3 million) in 5-year bonds with Fixed annual yield hits
12.25 % payable once every six months starting mid-January.
ECMS will use the proceeds of the Bonds to finance the
expansion of its network. The bonds are divided into two
tranches: the first tranche is valued at L.E 1.4 billion and
allocated for private offering and institutions while the second
tranche of L.E 100 Million is allocated for public offering.
On February 17, 2010 Orascom Telecom Holding S.A.E.
received a non interest bearing loan of US$ 225 million from
its shareholder, Weather Capital Special Purpose 1 S.A This
loan was converted into GDRs by way of participation in the
rights issue described above.
On March 8, 2010 the Company and Orascom Telecom
Bangladesh has signed an agreement with Standard
Chartered Bank, London –as intercreditor agent- to issue
amortizing senior secured bond with an amount 7.5 billion
BDT equivalent to USD 108 million due in 2014.
Other events
On January 21 2010,Orascom Telecom Holding announce
that it has obtained Majority Senior Secured Lenders consent
on the proposed permanent waiver related to the existence of
a  material tax claim under its US$2.5 billion credit agreement.
The waiver obtained is specific to the Algerian tax claim
against Orascom Telecom Algeria in respect of years 2004
to 2007.
On February 4, 2010, Orascom Telecom Holding (OTH) has
been awarded an extension to the management contract of
Alfa with the Republic of Lebanon, for a period of 6 months
ending on July, 31, 2010. Under this contract, OTH receives
a monthly sum of US$ 2.5 million in addition to 8.5% of total
revenues. Out of these amounts, OTH is liable to cover all the
operational expenses (OPEX) of the network and is entitled
to keep the remainder as management fees. The Republic
of Lebanon is fully responsible for the CAPEX during the
contract period.
37- Cash flow statements
Starting from the third quarter ended September 30, 2009
the company has reclassified the advances and loans made
to associates and third parties from the “financing activities”
to the “investing activities” caption. The reclassification was
adopted in order to adhere to IAS7 par. 16 (e). Hence, the
previous classification for the periods, March 2009 and June
2009 shall be reclassified accordingly.
59

  Current Non-current Total Currency Nominal Line of credit Maturity Securities   Current Non-current Total Currency Nominal Line of credit Maturity Securities
  Millions of USD Millions of contract currency    
  Millions of USD   Millions of contract currency    
Orascom Telecom Holding S.A.E.                
Egyptian Company for Mobile Services                
NATIONAL SOCIETE GENERALE BANK 9 - 9 USD 9 10 19-8-2010 Unsecured
Misr/CIB/NBE (Syndicated loans) 31 72 103 EGP 558 878 30/04/2013 Unsecured
Credit Agricole Indo Suez Ban 11 - 11 USD 11 22 30-6-2010 Unsecured Misr/CIB/NSGB/HSBC (Syndicated loans) 4 97 101 EGP 541 1,121 14/08/2014 Unsecured
National Bank Of Abu Dhabi 10 - 10 USD 10 10 21-2-2010 Unsecured Misr/CIB/NSGB/HSBC (Syndicated loans) 13 186 199 EGP 1,073 1,073 26/02/2015 Unsecured

NATIONAL SOCIETE GENERALE BANK 50 - 50 USD 50 50 18-2-2010 Unsecured BNP 5 - 5 EGP 42 59 30/04/2010 Unsecured

Fortis Banque 3 - 3 EURO 2 20 14-6-2010 Unsecured BB 4 - 4 EGP 24 27 under renewal Unsecured

H.S.B.C 2 - 2 EGP - 41 9/01/10 Unsecured
HSBC 15 - 15 USD 15 15 7/1/10 Unsecured
CAE 14 - 14 EGP 83 88 31/03/2010 Unsecured
NSGB-Car Loan - 2 2 EGP 11 15 2-2-2013 Unsecured
NSGB 12 - 12 EGP 73 74 30/04/2010 Unsecured
NSGB-Car Loan - 1 1 EGP 5 6 8-3-2014 Unsecured
Scotia 6 - 6 EGP 34 44 9/12/10 Unsecured
A1 Term Loan Supplemnt 104 863 967 USD 987 987 17-4-2013 Secured
CIB 3 - 3 EGP 15 24 16/09/2010 Unsecured
A2 Term Loan Supplemnt 54 448 502 USD 513 513 17-4-2013 Secured
12 months
AUB 3 - 3 EGP 17 17 Unsecured
Revolving Credit Supplemnt 1 1,000 1,001 USD 1,000 1,000 17-4-2013 Secured revolving

Audi Bank 38 - 38 USD 38 50 3/28/10 Unsecured   97 355 452          

Citi bank 10 - 10 USD 10 10 Within one Year Unsecured Orascom Telecom Bangladesh Limited                
Hermes Facility 16 60 76 USD 79 79 7/1/14 Secured
Egyptian Gulf Bank 5 - 5 USD 5 5 31-5-2010 Unsecured
USD Commercial Faciilty 32 86 118 USD 122 122 8/1/13 Secured
Pireaus 5 - 5 USD 5 5 Within one Year Unsecured
DFI Facility 3 25 28 USD 30 30 6/15/14 Secured
  315 2,314 2,629          
BDT A Facility 9 13 22 BDT 1,575 1,575 6/30/12 Secured
Pakistan Mobile Communications Limited                
BDT B Facility 3 10 13 BDT 918 918 6/30/14 Secured
Citibank N.A - Islamabad - Pakistan 4 4 8 PKR 633 1,740 02/07/2011 Secured Standard Chartered Bank, London 5 15 20 USD 25 50 9/30/16 Secured

Royal Bank of Scotland (Formerly ABN AMRO Bank)- Islamabad- Commercial Bank of Ceylon 1 - 1 BDT 100 100 3/20/10 Unsecured
- 42 42 PKR 3,548 3,548 18/12/2012 Secured
Pakistan Citibank, N.A. 9 - 9 BDT 620 620 2/1/10 Unsecured

Habib Bank Limited - Islamabad - Pakistan (2007) - 36 36 PKR 3,000 3,000 18/12/2013 Secured Standard Chartered Bank 4 - 4 BDT 290 290 1/9/10 Unsecured
Standard Chartered Bank 3 - 3 BDT 200 200 1/24/10 Unsecured
Royal Bank of Scotland, London - Citibank London - ECGD - ECA 7 10 17 USD 17 48 28/02/2012 Secured
Standard Chartered Bank 4 - 4 BDT 290 290 1/27/10 Unsecured
Royal Bank of Scotland, London - Citibank London -
30 26 56 EUR 39 125 30/12/2011 Secured BRAC Bank Ltd. 6 - 6 BDT 400 570 3/28/10 Unsecured
COFACE Loan - ECA
Eastern Bank Ltd. 4 - 4 BDT 280 292 6/25/10 Unsecured
Royal Bank of Scotland, London -AB Svensk ExportKredit -
11 5 16 EUR 12 46 29/03/2011 Secured Eastern Bank Ltd. 2 - 2 BDT 160 160 5/9/10 Unsecured
Sweeden - Hermes - ECA
Eastern Bank Ltd. 1 - 1 BDT 100 200 5/31/10 Unsecured
Royal Bank of Scotland, London
4 3 7 EUR 5 10 15/12/2011 Secured The City Bank 4 - 4 BDT 240 240 5/3/10 Unsecured
-The OPEC Fund for international Development  - ECA
The City Bank 2 - 2 BDT 150 150 4/9/10 Unsecured
Royal Bank of Scotland, London;  Citibank International
plc; Sumitomo Mitsui Banking Corporation Europe Limited 12 37 49 USD 51 70 28/02/2014 Secured National BankLtd 1 - 1 BDT 102 200 10/30/10 Unsecured
- ECGD - ECA Round II
Standard Chartered Bank (Working Capital Syndication) 5 - 5 BDT 360 360 3/17/10 Unsecured
Royal Bank of Scotland London;  Citibank International National Bank Ltd (Working Capital Syndication) 1 - 1 BDT 100 100 3/17/10 Unsecured
plc; Sumitomo Mitsui Banking Corporation Europe Limited 21 48 69 EUR 51 85 31/12/2013 Secured
- Coface - ECA Round II Pubali Bank Limted (Working Capital Syndication) 5 - 5 BDT 350 350 3/17/10 Unsecured
Standard Bank Limited (Working Capital Syndication) 1 - 1 BDT 100 100 3/17/10 Unsecured
Royal Bank of Scotland, London;  Citibank International
plc; Sumitomo Mitsui Banking Corporation Europe Limited 25 45 70 EUR 50 110 3/16/12 Secured Uttara Bank Ltd. (Working Capital Syndication) 2 - 2 BDT 150 150 3/17/10 Unsecured
- Hermes - ECA Round II Dutch Bangla Bank Limited 4 - 4 BDT 250 250 3/23/10 Unsecured

DEG - Germany 8 21 29 EUR 20 20 15/08/2013 Secured Dutch Bangla Bank Limited 4 - 4 BDT 300 530 3/30/10 Unsecured
  131 209 340          
FMO - Netherlands 8 21 29 EUR 20 20 15/08/2013 Secured

MCB Bank Limited (PKR 22.060  Billion) - Islamabad - Pakistan 18 261 279 PKR 22,060 22,060 04/01/2014 Secured

SCB Bank Limited STFA (PKR 5.1 Billion) - Islamabad Pakistan 11 50 61 PKR 5,100 5,100 09/05/2013 Secured

Dubai Islamic Bank (Pakistan) Ltd Ijara Facility PKR 700 Million - 8 8 PKR 700 700 09/05/2012 Secured

PAK Kuwait Investment Company Limited - Karachi - Pakistan 4 - 4 PKR 300 300 08/07/2010 Secured

HSBC Bank Middle East Limited- Islamabad - Pakistan 1 - 1 PKR 101 600 Within one year Secured

  164 617 781          

60

  Current Non-current Total Currency Nominal Line of credit Maturity Securities   Current Non-current Total   Nominal Maturity Securities

  Millions of USD Millions of contract currency       Millions of USD Currency Millions    

Pakistan Mobile Communications Limited              

Orascom Telecom Algeria S.P.A.                
Royal Bank of Scotland
Hermes loan 2006 21 39 60 USD 62 86 15/11/12 Secured 1 111 112 USD 112 13/11/2013 Unsecured
and Deutsche Bank Securities Inc. (Euro Bond)
Coface Loan 2006 26 - 26 DZD 1,904 9,724 15/11/10 Secured Pak Oman Investment Company Limited - Karachi - Pakistan
7 32 39 PKR 3,257 31/05/2013 Secured
(Trustee - Public Listed TFC)
  47 39 86          

Orascom Telecom Tunisie S.A.                 Allied Bank Limited - Islamabad - Pakistan (2007) 41 - 41 PKR 3,325 01/10/2010 Unsecured

International refinancing 24 23 47 Euro 100 100 March-2011 Secured Allied Bank Limited - Karachi - Pakistan (2007) 1 46 47 PKR 3,905 28/10/2013 Unsecured

Local refinancing 18 18 36 TND 105 105 March-2011 Secured                

  42 41 83           Orascom Telecom Finance SCA              

Moga Holding Limited                 Senior Notes OTFSCA 24 739 763 USD 750 8/2/14 Unsecured

CDC Mezzanine shareholder loan 29 - 29 EUR 18 18 15/8/2010 Secured Orascom Telecom Oscar              

  29 - 29           Indexed linked notes 2 251 253 USD 230 18/2/13 Secured

Med Cable Limited           Total Bonds 76 1,179 1,255        

     

Export Credit Calyon 3 3 6 EUR 6 12 13/9/11 Guaranteed

  3 3 6          

Intouch for Telecommunication Services                

NBAD 2 1 3 L.E 35 35 1/4/11 Secured

Barclays 2 - 2 L.E 35 35 1/10/10 Secured

  4 1 5          

Telecel Globe Limited                

Banque de development des etats de l›afrique
1 4 5 XAF 2,305 2,500 30/06/2014 Guaranteed
Central 2007
Commercial Bank Centrafrique 2008 1 - 1 XAF 398 750 30/06/2011 Secured

Ecobank Centrafrique - Local Loans 1 5 6 XAF 2,929 3,000 8/10/14 Secured

12 months
IBB - Bank Overdrafts 2 - 2 USD 2 2 Unsecured
revolving
12 months
Nedbank Limited and Investec Bank Limited - 42 42 NAD 311 311 Secured
revolving
  5 51 56          

Trans World Associates (Private) Limited                

November
Other - various banks 1 7 8 PKR 643 1,608 Secured
27, 2013
  1 7 8          

Total - liabilities to banks 838 3,637 4,475          

61

Selected subsidiaries, joint ventures and associates   Selected subsidiaries, joint ventures and associates  
  Country of domiciliation Shareholding (directly/indirectly) held by Orascom Telecom Holding   Country of domiciliation Shareholding (directly/indirectly) held by Orascom Telecom Holding
North Africa Algeria Orascom Telecom Algeria S.P.A. 96.81% Saudi Arabia Link Dot Net Saudi Arabia 100.00%
  Algeria Orascom Telecom Service Algeria 96.81%   Saudi Arabia Mobi Zone Saudi Arabia 100.00%
  Algeria Data Base Management services Algeria 100.00% Central Africa Burundi U-Com Burundi S.A. 100.00%
  Algeria Ring Algeria LLC 98.01%   Central Africa Telecel Centrafrique S.A. 100.00%
  Algeria Caring Algeria 97.03%   Sudan Sudan Call 70.00%
  Algeria MobiZone Algeria 100.00% Namibia Power-com Cell one 100.00%
  Algeria Algeria Win Call 100.00% North America Canada Globalive Investment Holdings 47.60%
  Algeria Consortium Algerian Telecommunication S.P.A. 49.83%   Canada Globalive Canada Holdings 65.40%
  Morocco Kenza Telecom Morocco 100.00%   Canada Globalive Wireless Management 65.40%
  Tunisia Ring Tunisia 78.21%   Canada Gloablive Wireless LP (GELP) 65.40%
  Tunisia Ring Distribution Tunisia 77.43%   Canada Globalive Telecom Holdings 65.40%
  Tunisia Ring Retail Tunisia 76.65%   Canada Orascom Telecom Holding (Canada) Limited 100.00%
  Tunisia R&D Tunisia 96.53% Europe France Orascom Telecom Services Europe 100.00%
  Tunisia Orascom Telecom Tunisie S.A. 50.00%   France Orascom Telecom Wireless Europe 100.00%
Asia Bangladesh Orascom Telecom Bangladesh Limited 100.00%   Italy MobiZone Italy 99.00%
  Bangladesh Ring Bangladesh 98.98%   Luxembourg M Link Sarl 100.00%
  Bangladesh MobiZone Bangladesh 100.00%   Luxembourg Orascom Luxembourg Sarl 100.00%
  North Korea CHEO Technology JV (DPKR) 75.00%   Luxembourg Orascom Luxembourg Finance SCA 100.00%
  Pakistan Pakistan Mobile Communications Limited 100.00%   Luxembourg Orascom Telecom Sarl 100.00%
  Pakistan Business & Communications 100.00%   Luxembourg Orascom Telecom Finance SCA 100.00%
  Pakistan Link Direct International Limited 100.00%   Luxembourg M Link Teleport 100.00%
  Pakistan Mobitalk Limited 100.00%   Malta Sawyer Limited 100.00%
  Pakistan MobiZone Pakistan (Pvt.) Limited 100.00%   Malta Orascom Telecom Eurasia Limited 100.00%
  Pakistan PMDL Limited 16.70%   Malta Oratel International Inc plc 100.00%
  Pakistan Trans World Associates (Private) Limited 51.00%   Malta Moga Holding Limited 100.00%
  Pakistan Ring Pakistan 94.59%   Malta International Wireless Communications Pakistan Limited 100.00%
  Pakistan Ring Pakistan Service 94.59%   Malta TMGL 100.00%
  Pakistan WOL Telecom Limited 100.00%   Malta Telecel International Limited 100.00%
  Pakistan Call Pack Pakistan 100.00%   Malta Orascom Tunisia Holding 100.00%
Middle East Dubai Global Entity for Telecom Trade 100.00%   Malta Carthage Consortium Limited 100.00%
  Dubai Global Entity for Telecom Trade -FZE 100.00%   Malta Orascom Iraq Holding 100.00%
  Dubai Ring Dubai 96.53%   Malta Orascom Telecom Iraq Corporation 100.00%
  Dubai LinkDotNet Dubai 100.00%   Malta Orascom Telecom Ventures Limited 100.00%
  Dubai MobiZone Dubai 100.00%   Malta Telecel Globe Limited *94%
  Egypt Middle East and North Africa Submarine Cable System –Mena Cable 100.00%   Malta Orascom Telecom Holding (Malta) Canada Limited 100.00%
  Egypt Cortex Egypt 94.00%   Malta M Link Limited 100.00%
  Egypt Ring for Distributions 99.00%   Malta Minimax Ventures 100.00%
  Egypt Advanced Electronic Industries 96.53%   Malta Financial Powers Plan Limited 100.00%
  Egypt Caring Egypt 97.02%   Malta Orascom Telecom ESOP Limited 100.00%
  Egypt Connect 50.49%   Malta Orascom for International Investment Holding 99.90%
  Egypt MMMS 98.80%   Malta Data Base Management services Limited 100.00%
  Egypt Intouch for Telecommunication Services 100.00%   Malta Orascom Telecom CS 100.00%
  Egypt Link Egypt 99.96%   Malta Mcube 51.00%
  Egypt Into Net 55.78%   Netherland Orascom Telecom Netherland 100.00%
  Egypt LINKdotNET 100.00%   Switzerland Telecel International S.A. Switzerland 100.00%
  Egypt Arab Finance Securities 100.00%   United Kingdom Med Cable Limited 100.00%
  Egypt Link Development 99.80%   United Kingdom Orascom Telecom WiMax 100.00%
  Egypt Link Online Egypt 100.00%   United Kingdom International Telecommunication Consortium Limited 50.00%
  Egypt Arpu for Telecommunication Services 100.00%
  Egypt Global Telecom 95.80% *see note (33)
  Egypt Egypt Call 99.98%
  Egypt Mobinil Services Egypt 35.86%
  Egypt Mobinil for Telecommunication S.A.E. 28.75%
  Egypt Egyptian Company for Mobile Services S.A.E. 34.67%
  Iraq Ring Iraq 96.53%
  Palestine Pal Call Palestine 99.90%
  Qatar LDN Qatar 49.00%
62

Auditor’s report
To the shareholders of Orascom Telecom Holding S.A.E

We have audited the accompanying consolidated financial statements of Orascom Telecom Holding S.A.E. which comprise
the consolidated balance sheet as at 31 December 2009, and the consolidated income statement, consolidated statement of
comprehensive income, consolidated statement of changes in equity and statement of consolidated cash flows for the financial
year then ended, and a summary of significant accounting policies and other explanatory notes.

Management’s responsibility for the financial statements

These consolidated financial statements are the responsibility of Company’s management. Management is responsible for the
preparation and fair presentation of these consolidated financial statements in accordance with the Egyptian Accounting Standards
and in the light of the prevailing Egyptian laws, management responsibility includes, designing, implementing and maintaining
internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement,
whether due to fraud or error; management responsibility also includes selecting and applying appropriate accounting policies;
and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit and we conducted our
audit in accordance with the Egyptian Standards on Auditing and in the light of the prevailing Egyptian laws. Those standards
require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the
financial statements are free from material misstatement.

Consolidated financial
statements and auditor’s report
(in EAS/EGP)
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.
The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of
the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control
•
•
Consolidated Balance Sheet
Consolidated Income Statement
relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal
•
•
Consolidated Statement of Comprehensive Income
Consolidated Statement of Changes in Equity
control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
• Consolidated Statement of Cash Flows
estimates made by management, as well as evaluating the overall presentation of the financial statements.
• Notes to the Consolidated Financial Statements
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the
• Appendix A - Liabilities to Banks
financial statements.
• Appendix B - Bonds
• Appendix C - Scope of Consolidation
Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated
financial position of Orascom Telecom Holding S.A.E as of 31 December 2009, and of its consolidated financial performance and
its consolidated cash flows for the year then ended in accordance with the Egyptian Accounting Standards and the Egyptian laws
and regulations relating to the preparation of these consolidated financial statements.

Emphasis of a matter

Without qualifying our opinion, we draw attention to note (35) “Contingent Assets and Liabilities” for the following:
1- Some subsidiaries received tax assessment from the tax authorities in the territories in which they operate. Management
believes that these assessments are excessive, and intends to challenge the assessments through the proper legal channels.
Currently, the management of these subsidiaries cannot make reliable estimate of tax exposures.
2-   Egyptian Company for Mobile Services (ECMS) “Jointly controlled entity” filed a lawsuit against the National Telecommunication
Regulatory Authority (NTRA) to cancel NTRA’s decision relating to the amendments of the interconnect prices between the
fixed and mobile networks. The Company and its external legal counselor believe that the possibility of winning the lawsuit
is probable as NTRA’s decision does not have legal or contractual ground, therefore the Company continued to recognize
interconnect revenue and cost from and to Telecom Egypt based on the existing agreement.

Cairo, 15 March, 2010 KPMG Hazem Hassan

63

Consolidated Balance Sheet Consolidated Income Statement

As at December For the year ended 31 December

(in million of EGP) Note 2009 2008 (in million of EGP) Note 2009 2008

Assets
Property and equipment 18 27,526 27,908 Revenues 7 28,262 29,153
Intangible assets 19 12,262 12,996 Other income 173 226
Other non-current financial assets 20 4,657 3,541 Purchases and services 8 (13,196) (13,747)
Deferred tax assets 21 654 486 Other expenses 9 (1,203) (955)
Total non-current assets 45,099 44,931 Personnel costs 10 (1,780) (1,554)
Net unusual inventory loss 13 (73) -
Inventories 304 584 Depreciation and amortization 11 (5,477) (4,981)
Trade receivables 22 1,828 1,813 Impairment charges 12 (214) (216)
Other current financial assets 20 629 1,535 Net unusual capital loss (84) -
Current income tax receivables 17 553 416 Disposal of non-current assets 13 232 363
Other current assets 23 2,084 1,377
Cash and cash equivalents 24 4,184 3,608 Operating income 6,640 8,289
Assets held for sale 6 606 445
Total current assets 10,188 9,778 Financial income 533 291
Total assets 55,287 54,709 Financial expense (2,852) (2,562)
Net foreign exchange gain /(loss) 151 (1,101)
Equity and liabilities Net financing costs 15 (2,168) (3,372)

Share capital 889 899 Share of (loss) of associates 16 (263) (16)

Reserves (968) (1,405) Gain on disposal of associates 16 - 149
Retained earnings 6,885 6,298
Equity attributable to equity holders of the Company 6,806 5,792 Profit before income tax 4,209 5,050
Minority interest 763 633
Total equity 25 7,569 6,425 Income tax expense 17 (2,013) (2,208)

Liabilities Profit for the year 2,196 2,842

Non-current borrowings 26 26,747 28,794
Other non-current liabilities 27 662 1,217 Attributable to:
Provisions 35 21 - Equity holders of the Company 1,845 2,464
Non-current income tax liabilities 17 - 237 - Minority interest 351 378
Deferred tax liabilities 21 1,191 1,424
Total non-current liabilities 28,635 31,693 Basic and diluted earnings per share in EGP 29 2.10 2.63

Current borrowings 26 5,483 2,930 )The notes from (1) to (37) are an integral part of these consolidated financial statements(
Trade payables 28 5,745 6,567
Other current liabilities 27 6,006 4,737
Current income tax liabilities 17 1,032 1,887
Provisions 517 334
Liabilities held for sale 6 300 136
Total current liabilities 19,083 16,591
Total liabilities 47,718 48,284
Total equity and liabilities 55,287 54,709

(The notes from (1) to (37) are an integral part of these consolidated financial statements)

Group CFO Chief Executive Officer Chairman & Managing Director

Aldo Mareuse Khaled Bichara Naguib Onsi Sawiris

Auditor’s report ‘attached’
64

Consolidated Statement of Comprehensive Income Consolidated Statement of Changes in Equity

For the year ended 31 December 2009 2008 Attributable to Equity holders of the Company
(in million of EGP) Share Treasury Other Retained Minority Total
Profit for the year 2,196 2,842 (in million of EGP) capital shares reserves earnings Total Interest equity
Other comprehensive income:
Changes in fair value of available-for-sale financial assets (9) (19) As of January 1, 2009 899 (865) (540) 6,298 5,792 633 6,425
Cash flow hedges, net of tax 138 (484) Comprehensive income
Currency translation differences (366) (1,161) Profit for the year - - - 1,845 1,845 351 2196
Share of profit recognized directly in equity of associates - 27 Other comprehensive income - - (249) - (249) 12 (237)
Other comprehensive income for the year, net of tax (237) (1,637)
Total comprehensive income for the year 1,959 1,205 Total comprehensive income - - (249) 1,845 1,596 363 1,959
Transactions with owners
Attributable to: Change in minority interest - - - - - (34) (34)
- Equity holders of the Company 1,596 848 Dividends - 310 56 (878) (512) (199) (711)
- Minority interest 363 357 Employees Dividends - - - (62) (62) - (62)
Share based compensation - 28 (12) - 16 - 16
)The notes from (1) to (37) are an integral part of these consolidated financial statements( Cancellation of shares (10) 422 (94) (318) - - -
Purchase of treasury shares - (186) - - (186) - (186)
Sale of treasury shares - 125 37 - 162 - 162
Total transactions with owners (10) 699 (13) (1,258) (582) (233) (815)
As of December 31, 2009 889 (166) (802) 6,885 6,806 763 7,569

Attributable to Equity holders of the Company

Share Treasury Other Retained Minority Total
(in million of EGP) capital shares reserves earnings Total interest equity

As of January 1, 2008 1,090 (4,965) 1,104 20,071 17,300 522 17,822

Comprehensive income
Profit for the year - - 2,464 2,464 378 2,842
Other comprehensive income - - (1,616) - (1,616) (21) (1,637)
Total recognized income - - (1,616) 2,464 848 357 1,205
Transactions with owners
Dividends - - - (909) (909) (331) (1,240)
Employees dividends - - - (88) (88) - (88)
Share based compensation - - 71 - 71 - 71
Cancellation of shares (191) 15,526 (95) (15,240) - - -
Purchase of treasury shares - (12,058) - - (12,058) - (12,058)
Sale of treasury shares - 632 (4) - 628 - 628
Capital increase in subsidiaries - - - - - 85 85
Total transactions with owners (191) 4,100 (28) (16,237) (12,356) (246) (12,602)
As of December 31, 2008 899 (865) (540) 6,298 5,792 633 6,425
65

Consolidated Statement of Cash Flows

For the year ended December 31 Note 2009 2008 1- General In particular, information about significant areas of
(in million of EGP) A- Legal status estimation uncertainty and critical judgments in applying
accounting policies that have the most significant effect
Profit for the year 2,196 2,842 Orascom Telecom Holding S.A.E “the Company” is an on the amount recognized in the financial statements
Adjustments for : Egyptian Joint Stock Company subject to the provisions are described in the following notes:
Depreciation, amortization and impairment of non current assets 5,691 5,197 of the Capital Market Law No. 95 of 1992 and its • Measurement of the recoverable amount of
executive regulations. The Company is a majority owned intangible assets and goodwill.
Net unusual inventory loss and capital loss items 157 - subsidiary of Weather Investments S.P.A registered in • Valuation of financial instruments
Income tax expense 2,013 2,208 Italy. The Company’s registered office is located in Nile • Recognition of deferred tax assets.
Share based compensation 69 71 City Towers, Ramlet Beaulac, Cairo, Egypt. • Provisions and contingencies.
Net financial charges 2,319 2,271 B- Purpose of the company
Unrealized foreign exchange difference (237) 786 3 - Significant accounting policies applied
The Company’s purpose is to participate in companies
Loss on disposal of non-current assets 10 8 issuing securities or to increase its share capital of The main accounting principles and policies adopted in
(Gain) from sale of subsidiaries and financial assets (242) (371) these companies. The Company may have interest or preparing these Consolidated Financial Statements are
Share of loss of associates 263 16 participate in, by any mean, in companies and other set our below. These policies have been consistently
enterprises that have activities similar to those of the applied to all periods in those consolidated financial
Gain on disposal of associates - (149) statements, and have been applied consistently by the
Company or those that may assist the Company to
Change in provisions and allowances 407 192 achieve its objective in Egypt or abroad. It may also group entities.
Change in assets carried as working capital (1,131) (847) merge into those companies and enterprises purchase The functional currency of each subsidiary is the
Change in other liabilities carried as working capital 1,157 521 them or affiliate them, pursuant to the provisions of the local currency where that entity operates. In order to
Income tax paid (3,470) (2,632) law and its executive regulations. present financial information to international investors,
Interest expense paid (2,635) (2,345) The company and its subsidiaries from the biggest the information presented in this document has been
companies in providing the mobile services in Middle presented in million of Egyptian Pounds (“EGP.”), except
Net cash generated by operating activities 6,567 7,768
East companies, Africa and South Asia, it covers a earnings per share information and unless otherwise
geographic area containing for 510 million citizens. stated.
Cash outflow for investments in:
C- Financial statement authorization 3-1 Basis of consolidation
- Property and equipment (6,104) (8,063)
- Intangible assets (661) (802) The financial statements were approved by the board of The consolidated financial statements include the
directors on March 15, 2010. following companies:
- Consolidated subsidiaries (169) (564)
- Financial assets and associates (422) (112) 3-1-1 Subsidiary companies
2- Basis of preparation
Proceeds from disposals of: - The consolidated financial statements include all
- Property and equipment 288 62 2-1 Statement of compliance subsidiaries that are controlled by the parent company
and which the management intends to continue to control.
- Subsidiaries 1,206 386 These Consolidated financial statements have been Control exists when the Group has the power to govern
- Associates - 5,234 prepared in accordance with the Egyptian Accounting the financial and operating policies of an entity so as to
-Financial assets - 5,739 Standards (EASs) and relevant Egyptian laws and obtain benefits from its activities. In assessing control,
Dividends and interest received 180 188 regulations. potential voting rights that presently are exercisable
Net investments in financial assets held for trading (227) - 2-2 Basis of measurement are taken into account. The financial statements of
subsidiaries are included in the consolidated financial
Advances and loans made to associate and other parties (37) (755) (2,419) The financial statements are prepared on the historical statements from the date that control commences until
Net cash (used in) investing activities (6,664) (351) cost convention, except for the following assets and the date that control ceases.
liabilities which are measured as fair value
Proceeds from non-current borrowings 4,638 13,805 • Derivative financial instruments. - Intragroup balances and transactions, including income,
• Financial instruments at fair value through expenses and dividends, are eliminated in full. Profits
Repayment of non-current borrowings (4,470) (10,801) profit and loss. and losses resulting from intragroup transactions that are
Net proceeds (payments) from current financial liabilities 919 (310) • Available-for-sale financial assets. recognized in assets, such as inventory and fixed assets,
Net change in cash collateral 464 (421) are eliminated in full. Intragroup losses may indicate an
2-3 Functional and presentation currency impairment that requires recognition in the consolidated
Dividend payments (509) ( 909)
These financial statements are presented in Egyptian financial statements. EAS 24 Income Taxes applies to
Net payments for treasury shares (23) (11,418) temporary differences that arise from the elimination of
pounds (EGP), which is the Company’s functional
Change in minority interest (193) (357) currency. All financial information presented in Egyptian profits and losses resulting from intragroup transactions.
Net cash generated by (used in) financing activities 826 (10,411) pounds has been rounded to the nearest million. - Minority interests shall be presented in the consolidated
Net increase (decrease) in cash and cash equivalents 729 (2,994) balance sheet within equity, separately from the parent
2-4 Use of estimates and judgments shareholder’s equity. Minority interests in the profit or
Cash included in assets held for sale (70) (44)
The preparation of financial statements requires loss of the group shall also be separately disclosed.
Effect of exchange rate changes on cash and cash equivalents (83) (247)
Cash and cash equivalents at the beginning of the year 3,608 6,893 management to make judgments, estimates and
assumptions that affect the application of accounting - A parent loses control when it loses the power to govern
Cash and cash equivalents at the end of the year 4,184 3,608 policies and the reported amounts of assets, liabilities, the financial and operating policies of an investee so as
income and expenses. Actual results may differ from to obtain benefit from its activities.
(The notes from (1) to (37) are an integral part of these consolidated financial statements) these estimates. 3-1-2 Joint venture companies
Estimates and underlying assumptions are reviewed on Joint control is the contractually agreed sharing of
an ongoing basis. Revisions to accounting estimates control over an economic activity, and exists only when
are recognized in the period in which the estimate is the strategic financial and operating decisions relating to
revised and in any future periods affected. the activity require the unanimous consent of the parties
sharing control (the ventures).
Proportion consolidation is a method of accounting
66
whereby a venture’s share of each of the assets,
liabilities, income and expenses of a jointly controlled
entity is combined line by line with similar items in the
venture’s financial statements or reported as separate
line items in the venture’s financial statements.
3-1-3 Investments in associates
Investments in associates are stated at equity method.
Under the equity method the investment in associates
is initially recognize at cost and the carrying amount
is increased or decreased to recognize the investor’s
share of the profit or loss of the associates after the date
of acquisition. Distributions received from associates
reduce the carrying amount of the investment.
Losses of an associate in excess of the Company’s
interest in that associate (which includes any long-term
interests that, in substance, form part of the Company’s
net investment in the associate) are not recognized,
unless the Company has incurred legal or constructive
obligations or made payments on behalf of the associate.
Any excess of the cost of the acquisition over
the Company’s share of the net faire value of the
identifiable assets, liabilities and contingent liabilities
of the associate recognized at the date of acquisition is
recognized as goodwill. The goodwill is included within
the carrying amount of the investment and is assessed
for impairment as part of the investment.
The license of the Group’s associated undertaking in
the Canada, Globalive Wireless Management Corp, are
indefinite lived assets. Although the spectrum licenses
have an initial term of 10 years, based on available
information, the management believes that they are
subject to perfunctory renewal and the renewal cost
will not be significant. Accordingly, they are not subject
to amortization but are tested annually for impairment,
or when indicators exist that the carrying value is not
recoverable.
3-2 Translation of the foreign currencies transactions
Orascom Telecom Holding and some of its subsidiaries
maintain their accounting books in Egyptian Pound.
Transactions denominated in foreign currencies
are recorded at the prevailing exchange rate at the
date of transactions. Monetary assets and liabilities
denominated in foreign currencies at the balance
sheet date are translated at the prevailing exchange
rates at that date. The foreign currencies exchange
differences arising on the settlement of transactions
and the translation at the balance sheet date are
recognized in the income statement.
3-3 Translation of the foreign subsidiaries’ financials
As at the balance sheet date the assets and
liabilities of these consolidated subsidiaries are
translated to Egyptian Pound at the prevailing rate
as at the period end, and the shareholders’ equity
accounts are translated at historical rates, where
as the income statement items are translated at
the average exchange rate prevailing during the
period of the consolidated financial statements.
Currency translation differences are recorded in the
shareholders’ equity section of the balance sheet
as translation reserves adjustments.
3-4 Derivative financial instruments
The Group uses derivative financial instruments
to hedge its exposure to foreign exchange and
interest rate risks arising from operational, financial
and investment activities. In accordance with
its treasury policy, the Group does not hold or
issue derivative financial instruments for trading
purposes. However, derivatives that do not
qualify for hedge accounting are accounted for as
trading instruments. Derivatives are recognized
initially at fair value; attributable transaction costs
are recognized in profit or loss when incurred.
Subsequent to initial recognition, derivatives are
measured at fair value, and changes therein are
accounted for as described below.
Cash flow hedges
Changes in the fair value of the derivative hedging
instrument designated as a cash flow hedge are
recognized directly in equity to the extent that the
hedge is effective. To the extent that the hedge is
ineffective, changes in fair value are recognized in
profit or loss.
If the hedging instrument no longer meets the
criteria for hedge accounting, expires or is sold,
terminated or exercised, then hedge accounting
is discontinued prospectively. The cumulative gain
or loss previously recognized in equity remains in
place until the forecast transaction occurs. When
the hedged item is a non-financial asset, the
amount recognized in equity is transferred to the
carrying amount of the asset when it is recognized.
In other cases the amount recognized in equity is
transferred to profit or loss in the same period that
the hedged item affects profit or loss.
Fair value hedges
Changes in the fair value of a derivative hedging
instrument designated as a fair value hedge are
recognized in profit or loss. The hedged item also
is stated at faire value in respect of the risk being
hedged, with any gain or loss being recognized in
profit or loss.
3-5 Property & equipment and depreciation
Property & equipment are stated at historical
cost and presented in the balance sheet net of
accumulated depreciation and impairment (Note 3-9-
b). Depreciation is charged to the income statement
over the estimated useful-life of each asset using the
straight-line method. The following are the estimated
useful lives, Estimate in respect of certain items of
“Cell Sites” were revised in 2009 ( see note 18) for
each class of assets, for depreciation calculation
purposes:
Assets Depreciation
period
Buildings 50 years
Cell sites 8-15 years
Tools 5-10 years
Computers equipment 3-5 years
Furniture and Fixtures 5-10 years
Vehicles 3-6 years
Leasehold improvements and renovations 3-8 years
Expenditure incurred to replace a component of an
item of property and equipment that is accounted for
separately, including major inspection and overhaul
expenditure, is capitalized. Other subsequent
expenditure is capitalized only when it increases the
future economic benefits embodied in the property
and equipment. All other expenditure is recognized
in the income statement as an expense as incurred.
3-6 Property and equipment under construction
Property and equipment under construction are
recognized initially at cost. Cost includes all
expenditures directly attributable to bringing the
asset to a working condition for its intended use.
Property and equipment under construction are
transferred to property and equipment caption
when they are completed and are ready for their
intended use.
3-7 Intangible assets
A- Goodwill
Goodwill (positive and negative) represents
amounts arising on acquisition of subsidiaries,
associates and joint ventures. Goodwill (positive
and negative) represents the difference between
the cost of the acquisition and the fair value of
the net identifiable assets acquired at acquisition
date.
- Positive goodwill is stated at cost less
impairment losses.
- While negative goodwill arose will be
recognized directly in the income statement.
- Goodwill resulting from further acquisitions
after control is obtained is determined on the
basis of the cost of the additional investment
and the carrying amount of net assets at the
date of acquisition, accordingly.
B- Other intangible assets
Other intangible assets that are acquired by
the Group are stated at cost less accumulated
amortization and impairment losses. Amortization
is recognized in the income statement on a
straight – line basis over the estimated useful lives
of intangible assets. License fees are amortized
over the period of the licenses, concessions and
computers software are amortized from the date
they are available for use. The estimated useful
lives are as follows:
Assets Amortization period
- Licenses Fees Over the remaining period of
the licenses
- Concessions and Comput- 3-15 years
ers software
C- Subsequent expenditure
Subsequent expenditure on capitalized intangible
assets is capitalized only when it increases the
future economic benefits embodied in the specific
asset to which it relates. All other expenditure is
expensed as incurred.
3-8 Investments at fair value
a- Available-for-sale financial assets
Available-for-sale financial assets are valued at
fair value, with any resultant gain or loss being
recognized in equity, except for impairment losses
which is recognized in the income statement.
When these investments are derecognized, the
cumulative gain or loss previously recognized
directly in equity is recognized in the income
statement. The fair value of investments
available for sale, identifies based on quoted
price of the exchange market at the balance
sheet date, investments that are not quoted, and
whose fair value can not be measured reliably,
are stated at cost less impairment loss.
b- Investments at fair value through profit and
loss
An instrument is classified as at fair value
through income statement if it is held for trading
or is designated as such upon initial recognition.
Financial instruments are designated at fair
value through income statement if the Company
manages such investments and makes
purchase and sale decisions based on their fair
value.
3-9 Impairment
a- Financial assets
A financial asset is considered to be impaired
if objective evidence indicates that one or
more events have had a negative effect on the
estimated future cash flows of that asset.
An impairment loss in respect of a financial asset
measured at amortized cost is calculated as the
difference between its carrying amount, and the
present value of the estimated future cash flows
discounted at the original effective interest rate.
An impairment loss in respect of an available-for-
sale financial asset is calculated by reference to
its current fair value.
Individually significant financial assets are
tested for impairment on an individual basis.
The remaining financial assets are assessed
collectively in groups that share similar credit risk
characteristics.
All impairment losses are recognized in profit
or loss. Any cumulative loss in respect of an
available-for-sale financial asset recognized
previously in equity is transferred profit or loss.
An impairment loss is reversed if the reversal can
be related objectively to an event occurring after
the impairment loss was recognized. For financial
assets measured at amortized cost and available-
for-sale financial assets that are debt securities,
the reversal is recognized in profit or loss. For
available-for-sale financial assets that are equity
securities, the reversal is recognized directly in
equity.
b- Non-financial assets
The carrying amounts of the Group’s non-financial
assets, other than biological assets, investment
property, inventories and deferred tax assets,
are reviewed at each reporting date to determine
whether there is any indication of impairment.
An impairment loss is recognized if the carrying
amount of an asset or its cash-generating
unit exceeds its recoverable amount. A cash-
67
generating unit is the smallest identifiable asset
group that generates cash flows that largely
are independent from other assets and groups.
Impairment losses are recognized in profit or loss.
The recoverable amount of an asset or cash-
generating unit is the greater of its value in use
and its fair value less costs to sell.
Impairment losses recognized in prior periods
are assessed at each reporting date for any
indications that the loss has decreased or no
longer exists. An impairment loss is reversed if
there has been a change in the estimates used to
determine the recoverable amount. An impairment
loss is reversed only to the extent that the asset’s
carrying amount does not exceed the carrying
amount that would have been determined, net
of depreciation or amortization, if no impairment
loss had been recognized.
3-10 Cash and cash equivalents
For the purpose of preparing the Statement of Cash
Flows, the Company considers all cash on hands and
bank on demand deposits with banks and short-term
highly liquid investments that are readily convertible
to known amounts of cash and that are subject to
an insignificant risk of changes in value with original
maturities of three months or less are considered as
cash and cash equivalents. The Statement of Cash
Flows is prepared according to the indirect method.
3-11 Trade and other receivables
Trade and other receivables are stated at their cost
less impairment losses.
3-12 Inventories
Inventories are stated at the lower of cost and
net realizable value. Cost is determined using the
weighted average method and net realizable value is
the estimated selling price in the ordinary course of
business, less the estimated costs of completion and
other addition expenses.
3-13 Non-current assets held for sale
Non-current assets (or disposal groups comprising
assets and liabilities) that are expected to be recovered
primarily through sale rather than through continuing
use is classified as held for sale. Immediately
before classification as held for sale, the assets (or
components of a disposal group) are remeasured
in accordance with the Group’s accounting policies.
Thereafter generally the assets (or disposal group)
are measured at the lower of their carrying amount
and fair value less cost to sell. Any impairment loss on
a disposal group first is allocated to goodwill, and then
to remaining assets and liabilities on pro rata basis,
except that no loss is allocated to inventories, financial
assets, deferred tax assets, employee benefit assets,
investment property and biological assets, which
continue to be measured in accordance with the
Group’s accounting policies. Impairment losses on
initial classification as held for sale and subsequent
gains or losses on remeasurement are recognised in
profit or loss. Gains are not recognised in excess of
any cumulative impairment loss.
3-14 Taxation
Income tax on the profit or loss for the year comprises
current and deferred tax. Income tax is recognized
in the income statement except to the extent that it
relates to items recognized directly in equity, in which
case it is recognized in equity.
Current tax is the expected tax payable on the taxable
income for the year, using tax rates enacted or
substantially enacted at the balance sheet date, and
any adjustment to tax payable in respect of previous
years.
Deferred tax is provided using the balance sheet
liability method, providing for temporary differences
between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts
used for taxation purposes. The amount of deferred
tax provided is based on the expected manner of
realization or settlement of the carrying amount of
assets and liabilities, using tax rates enacted or
substantively enacted at the balance sheet date.
A deferred tax asset is recognized only to the extent
that it is probable that future taxable profits will be
available against which the asset can be utilized.
Deferred tax assets are reduced to the extent that it is
no longer probable that the related tax benefit will be
realized.
3-15 Provisions
Provisions are recognized when the Company has
a legal or constructive obligation as a result of a
past event and it’s probable that a flow of economic
benefits will be required to settle the obligation. If
the effect is material, provisions are determined by
discounting the expected future cash flows at a pre-
tax rate that reflects current market assessment of the
time value of money and, where appropriate, the risks
specific to the liability. Provisions are reviewed at the
balance sheet date and amended (when necessary)
to represent the best current estimate.
3-16 Earning per share
The Company presents basic earnings per share
(EPS) data for its ordinary shares. Basic EPS is
calculated by dividing the profit or loss attributable to
ordinary shareholders of the Company by the weighted
average number of ordinary shares outstanding during
the period.
3-17 Interest-bearing borrowings
Interest-bearing borrowings are recognized initially
at fair value less attributable transaction costs.
Subsequent to initial recognition, Interest-bearing
borrowings are stated at amortized cost with any
difference between cost and redemption value being
recognized in the income statement over the period of
the borrowings on an effective interest basis.
3-18 Issued capital
a- Repurchase of share capital
When share capital recognized as equity is
repurchased, the amount of the consideration paid,
including directly attributable costs, is recognized as
a change in equity.
Repurchased shares are classified as treasury stock
and presented as a deduction from total equity.
b- Dividends
Dividends are recognized as a liability in the year
in which they are declared.
3-19 Legal reserve
As per the Company’s statutes 5% of net profit for
the year is set aside to form a legal reserve, the
transfer to such reserve ceases once it reaches 50%
of the Company’s paid in share capital. The reserve
can be utilized in covering losses or increasing the
Company’s share capital.
3-20 Revenue recognition
(i) Cellular operations revenue
GSM revenue is recognized when services
rendered to the customers based on the actual
usage airtime from the following activities:
- Prepaid cards is recognized based on the
actual used calls minutes while the unused
call minutes at the end of the period are
deferred.
- Monthly and connection fees are recognized
in the income statement on a straight-line
basis over the period or the terms of the
contract.
- Other GSM telecommunications services and
facilities when provided.
(ii) Telecommunications services revenue
Revenue from the provision of telecommunications
services includes the following:
- Goods sold
Revenue is recognized when the significant
risks and rewards of ownership have been
transferred to the buyer.
- Construction contracts
Revenue is recognized in proportion to the
stage of completion of the contract.
- Satellite services
Revenue is recognized once the services
delivered to the client.
- VAS revenue
Value added services (VAS) revenue is
recognized once the services are delivered,
or used by the customers.
- Space segment revenue
Space segment rental fees are recognized
in the income statement on a straight-line
basis over the terms of the lease.
(iii) Internet and fixed lines revenue
Revenue is recognized once the service delivered
to the client.
3-21 Expenses
a- Borrowing costs
Borrowing costs are recognized as expenses in
the income statement when incurred, with the
exception of borrowing cost directly attributable
to the construction and acquisition of new assets
which is capitalized as part of the relevant assets
cost and depreciated over assets’ estimated
useful lives. This capitalization ceases once the
assets become in operational condition and ready
for use.
b- Employees’ pension
The Company contributes to the government social
insurance system for the benefit of its personnel
in accordance with the social insurance law.
Under this law, the employees and the employers
contribute into the system on a fixed percentage-of-
salaries basis. The Company’s liability is confined
to the amount of its contribution. Contributions are
charged to income statement using the accrual
basis of accounting.
3-22 Segment reporting
A segment is a distinguishable component of the group
that is engaged either in providing products or services
(business segment) or in providing products or services
within a particular economic environment (geographical
segment), which is subjected to risks and rewards that
are different from those of other segments. The group’s
primary format for segment reporting is based on
business segment.
3-23 Discontinued operations
A discontinued operation is a component of the Group’s
business that represents a separate major line of
business or geographical area of operations that has
been disposed of or is held for sale, or is a subsidiary
acquired exclusively with a view to resale. Classification
as a discontinued operation occurs upon disposal or
when the operation meets the criteria to be classified as
held for sale, if earlier. When an operation is classified
as a discontinued operation, the comparative income
statement is re-presented as if the operation had been
discontinued from the start of the comparative period.
4. Financial Risk Management
Financial Risk Factors
The Group’s activities expose it to a variety of financial risks: market
risk (including currency risk, fair value interest risk and cash flow
interest risk), credit risk and liquidity risk. In particular the Group is
exposed to risks from movements in exchange rates, interest rates
and market prices. The Group’s overall risk management program
focuses on the unpredictability of financial markets and seeks to
minimize potential adverse effects on the Group’s performance
through ongoing operational and finance activities. Depending on
the risk assessment, the Group uses selected derivative hedging
instruments. The management has overall responsibility for the
establishment and oversight of the group’s risk management
framework.
Market Risk
Foreign exchange risk
The Group operates internationally and is exposed to foreign
exchange risk arising when its business transactions are in
currencies other than its functional currency. The main currencies
to which the Group is exposed are the US dollar, the Canadian
Dollar and the Euro.
In general the Group’s subsidiaries are encouraged to obtain
financing in their functional currency in order to have a natural
hedge of the exchange rate of such financing. However, as some
transactions are executed in foreign currencies, and in particular
in US$, CAD and Euro, the Group may be subject to the risk of
68

exchange rate fluctuations which, in certain instances the Group Price risk amounts due from a wide range of counterparties, therefore, the monitored at entity level whereby each subsidiary is responsible for
manages through the use of hedging strategies. As of December The Group has limited exposure to equity securities price risk on Group does not consider that it has a significant concentration of managing and monitoring its cash flows and rolling liquidity reserve
31, 2009 the Group’s borrowings included US$ borrowings investments held by the Group. credit risk. forecast in order to ensure that it has sufficient committed facilities
amounting to EGP 23,313 million (equivalent to US$ 4,232 million) to meet its liquidity needs.
and Euro borrowings amounting to EGP 1,988 (equivalent to Liquidity Risk
Euro 248 million). In certain instances the Group has entered into Credit Risk The table below analyses the group’s financial liabilities into relevant
The Group monitors and mitigates liquidity risk arising from the
economic hedging agreements to manage the risk of fluctuations The Group considers that it is not exposed to major concentrations maturity groupings based on the remaining period at the balance
uncertainty of cash inflows and outflows by maintaining sufficient
relating to these financing operations. In particular, Pakistan Mobile of credit risk in relation to trade receivables. However, credit sheet to the contractual maturity date. The amounts disclosed in the
liquidity of cash balances as well as undrawn credit lines and by
Communication Limited (PMCL) had borrowings for EGP 975 risk can arise in the event of non-performance of a counterparty, table are the contractual undiscounted cash flows.
diversifying its sources of finance. In general, liquidity risk is
million (equivalent to US$ 177 million) and EGP 1,523 (equivalent particularly in relation to credit exposures for trade and other
to Euro 190 million) as of December 31, 2009. Such borrowings receivables, financial instruments and cash and cash equivalents. Carrying Expected cash Less than 1 Between 1 and More than 5
were fully hedged by PMCL using cross currency swaps pursuant As of December 31, 2009
to which interest payments and principal payments are paid in amount flows (*) year 5 years years
The Group considers that the concentration of credit risk with respect
Pakistani Rupee. to trade receivables is limited given that the Group’s customer base Liabilities
is largely pre-paid subscribers. Post paid subscribers generally Liabilities to banks 24,652 27,595 5,625 21,850 120
The Group subsidiaries generally execute their operating activities represent a small portion of the subscriber base and therefore the Bonds 6,914 9,224 875 8,349 -
in their respective functional currencies. Some Group subsidiaries credit exposure is limited. In addition, the Group tries to mitigate Other borrowings 119 128 108 20 -
are, however, exposed to foreign currency risks in connection with credit risk by adopting specific control procedures, including
scheduled payments in currencies that are not their functional Telecommunication license payable 2,003 2,313 1,575 332 406
assessing the credit worthiness of the counterparty and limiting the
currencies. In general this relates to foreign currency denominated exposure to any one counterparty. Trade payables 5,745 5,745 5,745 - -
supplier payables and receivables. The Group monitors the 39,433 45,005 13,928 30,551 526
exposure to foreign currency risk arising from operating activities Credit risk relating to cash and cash equivalents, derivative
and, where relevant, enters into hedging transactions in order to financial instruments and financial deposits arises from the risk Carrying Expected cash Less than 1 Between 1 and More than 5
manage the exposure. that the counterparty becomes insolvent and accordingly is unable As of December 31, 2008
amount flows (*) year 5 years years
to return the deposited funds or execute the obligations under the
As of December 31, 2009, if the functional currencies had Liabilities
derivative transactions as a result of the insolvency. To mitigate
weakened / strengthened by 3% against the US$, the Euro and Liabilities to banks 24,467 30,526 4,060 25,257 1,209
this risk, wherever possible the Group conducts transactions
CAD, with all other variables held constant, the translation of and deposits funds with financial institutions with a minimum of Bonds 6,377 9,003 630 4,058 4,315
foreign currency receivables and payables would have resulted in investment grade rating. Other borrowings 250 300 105 195 -
a decrease/ increase in profit for the year (after tax) of EGP 363 Telecommunication licence payable 2,190 2,640 1,127 1,021 492
million, mainly relating to US$ denominated borrowings. The Group is exposed to credit risk relating to financial receivables
as follows: Trade payables 6,567 6,567 6,567 - -
Additionally, the Group has investments in foreign operations, • During 2008 the Company entered into two loans 39,851 49,036 12,489 30,531 6,016
whose net assets are exposed to foreign currency translation risk. agreements to provide a total amount of EGP 2,695
Currency exposure to such risk is not hedged. million (equivalent to CAD 508 million) to Globalive * Expected cash flows are the gross contractual undiscounted cash flows including interest, changes and other fees.
Wireless Management Corp (“GWMC”), a subsidiary The table below analyses the group’s derivative financial instruments into relevant maturity groupings based on the remaining period at
Cash flow and fair value interest rate risk of the associate Globalive Investment Holdings Corp the balance sheet date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.
The Group is exposed to market risks as a result of changes in (“Globalive”). The amount of these loans was further
interest rates particularly in relation to borrowings. Borrowings increased to EGP 3,225 million (equivalent to CAD 608
million) during 2009. As of December 31, 2009 the amount As of December 31, 2009 Expected cash flows (*) Less than 1 year Between 1 and 5 years More than 5 years
issued at floating rates expose the Group to cash flow interest rate
risk. Borrowings issued at fixed rates expose the Group to fair outstanding under such loan agreements, including Cash outflow / (cash inflow)
value interest rate risk. accrued interest, was CAD 723 million (equivalent to Interest rate derivatives 540 357 183 -
EGP 3,833 million). The loans were primarily provided Foreign exchange derivatives (1,131) (178) (953) -
The basic strategy of interest rate risk management is to balance to GWMC to fund the acquisition of spectrum licenses in Other Derivative instruments- Cash
the debt structure with an appropriate mix of fixed and floating Canada. The licenses were awarded to GWMC during (152) (50) (102) -
inflow
interest rate borrowings based on the Group’s perception of future March 2009 by Industry Canada and GWMC became fully
interest rate movements. In particular, the risk monitored relates operational in early 2010. During the start-up phase of Total (743) 129 (872) -
to the impact of movements in floating rate indices on the Group’s operations Globalive has incurred losses and as a result
finance costs. the Group’s share of losses exceeds the carrying value of
the investment. The Group considers the loan provided As of December 31, 2008 Expected cash flows (*) Less than 1 year Between 1 and 5 years More than 5 years
When considered appropriate, the Group manages its cash flow as part of the investment and has therefore deducted Cash outflow / (cash inflow)
interest rate risk by using floating-to fixed interest rate swaps. In the excess losses from the receivable. After considering
such losses an amount of EGP 3,542 million is recorded Interest rate derivatives 641 236 405 -
particular, as of December 31, 2009 the Group had two interest rate
derivative contracts. The first contract is a floating-to-fixed interest in financial receivables. (see Note 20 “Other financial Foreign exchange derivatives (5) 57 (59) (3)
rate swap with a notional value of US$ 1.5 billion and the other assets” for further details).
• In November 2008 the Company sold its investment Other derivative instruments -
contract is a switchable interest rate swap with a notional value
of US$ 500 million. After considering such derivative transactions in Orasinvest Holding Inc. (“OrasInvest”). The total cash outflow 31 31 - -
approximately 57% of the Group’s total borrowings had a floating receivable from the sale amounted to EGP 985 million Other derivative instruments -
rate of interest. (equivalent to US$ 180 million), prior to price adjustments. cash inflow (31) (31) - -
Of this EGP 985 million, EGP 487 million (equivalent to Total 636 293 346 (3)
The Group considers the sensitivity of its finance costs to US$ 90 million) was received in 2008 and a further EGP
movements in interest rates. In particular an increase / decrease 413 million (equivalent to US$ 75 million) was received * Derivative cash flows for interest rate derivatives and foreign exchange derivatives represent the net cash flow from the relevant swap transaction
of 1.0% in interest rates as of December 31, 2009 would have and settled in 2009. As of December 31, 2009 the as such derivatives are net settled. Cash inflow and cash outflow for other derivative instruments are shown separately as such derivatives are
resulted in an increase / decrease in finance costs of EGP 182 amount outstanding was EGP 83 million (equivalent to gross settled.
million and a decrease / increase in the cash flow hedge reserve US$ 15 million). The remaining receivable is expected to
of EGP 187 million. be settled during 2010.

In general the remaining other receivables and financial receivables

included in financial assets generally relate to a variety of smaller
69

Derivative cash outflows do not include the potential cash outflows ability to be able to transfer funds. The regulations in the various Primary segment information
should the share warrants of My Screen and Lingo be exercised. The countries where the subsidiaries operate could reduce the ability to
exercise of such warrants is at the option of the Group. Details of such pay interest and dividends and to repay loans, credit instruments (in million of LE) GSM Telecom services Internet & fixed line Unallocated Total
warrants are provided in note 19 “Other financial assets”. Additionally and securities expressed in foreign currency through the transfer
2009
the put and call option for the purchase of the investment in Namibia of currency. In addition, in some countries it could be difficult to
has not been included in the contractual cash flows. convert large amounts of foreign currency due to central bank 2008
Contractual cash flows are divided based on the relevant index as of regulations. The central banks may amend regulations in the
the balance sheet date. future and therefore the ability of the company to receive funds Gross revenues 26,513 1,448 549 - 28,510
from its subsidiaries may be restricted.
Capital risk management 26,738 3,822 521 - 31,081

The Group’s objectives when managing capital are to safeguard the 5- Segment reporting Intersegment revenues (16) (178) (54) - (248)
Group’s ability to continue as a going concern in order to provide The Company considers primary segment information by business
returns for shareholders and to maintain an optimal capital structure activity. The method used to identify the business segments include (581) (1,248) (99) - (1,928)
to reduce the cost of capital. In order to maintain or adjust the capital the factors used by management to direct the Group and assign Net revenues 26,497 1,270 495 - 28,262
structure, the Group may adjust the amount of dividends paid to managerial responsibilities. The methodology adopted to identify
shareholders, return capital to shareholders through share buyback the components of revenues and cost attributable to each business 26,157 2,574 422 - 29,153
transactions, issue new shares or sell assets to reduce debt. segment is based on the identification of each component of cost
and revenues directly attributable to each segment. The operating Impairment Charges (136) - (78) - (214)
Other risks activities of the Group are organized and managed separately (41) - (175) - (216)
based on the nature of the products and services provided. Each
Political and economic risk in emerging countries segment offers different products and services to different markets Depreciation and amortization (5,321) (39) (94) (23) (5,477)
A significant amount of the Group’s operations are conducted in and is controlled by different legal entities.
Algeria, Pakistan, Egypt and Tunisia. The operations of the Group (4,809) (63) (88) (21) (4,981)
depend on the market economies of the countries in which the The following primary business segments have been identified:
Operating income 7,125 147 (223) (409) 6,640
subsidiaries operate. In particular, these markets are characterized • GSM covering the mobile telecommunications services
by economies that are in various stages of development or are activities of the Group, including the sale of pre-paid 8,127 (36) (393) 591 8,289
undergoing restructuring. Therefore the operating results of the telephone cards, post-paid and monthly subscriptions
Group are affected by the current and future economic and political packages, telephone packages and roaming included in Profit before income tax 5,571 123 (256) (1,229) 4,209
developments in these countries. In particular, the results of this segment are ;
operations could be unfavorably affected by changes in the political • Telecom services relating to the sale of handsets, 6,153 (103) (435) (565) 5,050
or governmental structures or weaknesses in the local economies including ring tones and other cell phone products and Profit for the Year 3,882 33 (269) (1,450) 2,196
in the countries where it operates. These changes could also have activities relating to the rental of portals to allow satellite
an unfavorable impact on financial condition, performance and roaming calls and value added service activities; and 4,525 (348) (446) (889) 2,842
business prospects. • Internet & fixed line covering the internet and fixed
telecommunications services of the Group. Total Segment assets 46,284 2,314 880 5,809 55,287
Regulatory risk in emerging countries 46,251 2,275 1,091 5,092 54,709
Due to the nature of the legal and tax jurisdictions in the emerging The Group also reports geographical segments based on the
countries where the Group operates, it is possible that laws and geographical location of the legal entity controlling the operation, Total Capital expenditure 5,115 515 31 32 5,693
regulations could be amended. This could include factors such which is the same as the location of the major customers.
as the current tendency to withhold tax on the dividends of these 9,318 597 349 28 10,292
subsidiaries, receiving excessive tax assessments,the granting of The following geographical segments have been identified:
Total segment liabilities 24,473 2,231 598 20,416 47,718
relief to certain operations and practices relating to foreign currency • North Africa – comprising Algeria and Tunisia
exchange. These factors could have an unfavorable effect on the • Middle East – comprising Egypt 26,317 985 590 20,392 48,284
financial activities of the Group and on the ability to receive funds • South Asia – comprising Pakistan and Bangladesh
from the subsidiaries. • Others – comprising, North Korea, Central Africa,
Revenue generated by the majority of the Group subsidiaries is Namibia, Burundi, Malta, Belgium, the United Kingdom
expressed in local currency. The Group expects to receive most and other countries
of this revenue from its subsidiaries and therefore it relies on their

**Unallocated represents revenues and costs relating to activities
provided centrally from headquarters to subsidiaries across the
group. These activities include staff functions with group wide
responsibilities such as internal audit, financial advisory, legal
services, communications and investor relations. Unallocated
assets and liabilities mainly include borrowings of the Company
and deferred tax assets and liabilities.
** Segment capital expenditure is the total cost incurred during the
period to acquire property and equipment and intangible assets
other than goodwill.
70

Secondary segment information carrier M-Link in January 2009. (See Note 34 “Related party 10- Personnel costs
transactions” for further information) Revenue from international
(in million of LE) North Africa Middle East South Asia Other Unallocated Total and national roaming decreased in 2009 due to the agreement of 2009 2008
discounts with many operators and low prices offered to compete
2009 Wages and salaries 1,173 1,078
in the challenging markets across the territories during 2009.
In general revenues during 2009 were negatively impacted by Bonuses given to management and
2008 257 146
the movements in local currencies compared to the EGP and in employees
Gross revenues 12,418 7,137 7,978 977 - 28,510 particular movements in the Algerian Dinar and Pakistan Rupee. Social security 95 86
13,413 7,670 8,375 1,623 - 31,081 Share based compensation 69 61
8- Purchases and services Pension costs 48 41
Intersegment revenues (5) (197) (20) (26) - (248) 2009 2008 Board of Directors remuneration 20 15
(454) (923) (133) (418) - (1,928) Interconnection traffic and roaming 3,287 3,899 Other personnel costs 118 127
Cost of handsets, scratch cards, sim
1,747 1,704 Total 1,780 1,554
Net revenues 12,413 6,940 7,958 951 - 28,262 cards, bundle cost
Advertising and promotional services 1,055 1,382 The increase in personnel cost was primarily due to the increase
12,959 6,747 8,242 1,205 - 29,153
Internet and fixed line costs 1,347 1,336 in the number of employees in 2009 compared to 2008 as well as
Operating income 4,822 1,311 705 222 (420) 6,640 Customer acquisition costs 1,293 1,215 restructuring and an increase in salaries mainly in the Company and
Maintenance costs 1,301 1,038 Egyptian Company for Mobile Services S.A.E. (“ECMS”). Bonuses
5,703 1,059 760 176 591 8,289 increased in 2009 compared to 2008 mainly relating to bonuses paid
Utilities 762 721
Profit before income tax 4,657 971 (332) 155 (1,242) 4,209 Rental of network 392 466 in PMCL in 2009 as a result of reaching operational targets.

5,466 732 (618) 136 (666) 5,050 Other leases and rentals 409 417
The table below provides a breakdown of the number of employees
Rental of civil and technical sites 431 388 as of December 31:
Profit for the year 3,135 604 (278) 196 (1,461) 2,196 Consulting and professional services 363 318
3,911 310 (453) 65 (991) 2,842 Consumable materials, equipment
110 264 As of December 31,
and goods
Total Segment assets 17,249 10,746 18,551 2,847 5,894 55,287 Cost for security service 195 205 (in number of employees) 2009 2008
Cost for printing & collection services 110 64    
17,024 20,999 10,004 1,556 5,126 54,709 Senior management 294 216
Other service expenses 394 330
Middle management 1,701 1,447
Total Capital expenditure 1,717 1,817 1,619 508 32 5,693 Total 13,196 13,747 Staff 15,218 14,859
1,203 5,504 3,406 151 28 10,292 Purchases and services costs decreased during 2009 primarily Total 17,213 16,522
due to the weakening of the local currencies compared to the US$.
As a percentage of revenues, purchase and service costs were The table below provides a breakdown of the average number of
6- Assets and liabilities classified as held for sale Oracap Far East Ltd reclassified as held for use.
substantially consistent, amounting to 46.7% in 2009 and to 47.1% employees for the years ended December 31, 2009 and 2008:
Orascom Telecom Holding management decided to stop the
The following provides a breakdown of assets and liabilities held process of sale of Oracap Far East Ltd. and reclassified as held in 2008.
for sale as of December 31, 2009: for use. Average for the year
In particular, interconnection traffic and roaming costs decreased in ended December 31,
2009 2008 2009 compared to 2008 mainly due to the sale of M-Link in January 2009 2008
Sale of M-link S.a.r.l (Luxemburg) (M-Link)
Property, plant and equipment 261 61 The assets and liabilities of M-Link were presented as held for sale 2009. Advertising and promotional expenses decreased in 2009 (in number of employees)    
Intangible assets 166 111 in 2008, following the decision of management of the Company to compared to 2008 mainly due to a change in policy in Bangladesh. Senior management 255 205
Trade receivables 67 221 focus on GSM business and dispose of non-core assets. On January Consumable materials, equipment and goods decreased in 2009 Middle management 1,574 1,355
Other current assets 42 8 13 th, 2009 the Company announced the sale of 100% of M-Link due to the sale Orasinvest. These items were partially offset by an Staff 15,039 15,012
to TLC SERVIZI S.p.A (now renamed Wind International Services increase in maintenance costs due to an increase in the number
Cash and cash equivalents 70 44 Total 16,868 16,572
S.p.A.), a wholly owned subsidiary of Wind Telecomunicazioni of cell sites and general utilities costs and an increase in costs of
Assets held for sale 606 445 handsets, scratch cards, sim cards, bundle cost mainly due to the
S.p.A., for a total consideration of approximately EGP 435 million 11- Depreciation and amortization
    in cash. (See Note 34 “Related party transactions”). increased sales of Ring.
Current and non current
128 -
borrowings 9- Other expenses 2009 2008
Trade payables 81 119 7- Revenues
2009 2008 Depreciation of property and
   
Other current liabilities 83 11 License costs 320 304 equipment:
2009 2008 -Cell sites 4,142 3,747
Current income tax liabilities 1 6 Travel costs 87 113
Revenues from services     -Computers, fixtures and other
Deferred tax liabilities 7 - Accruals for provisions 181 78
Telephony services 22,178 21,861 equipment 321 338
Liabilities held for sale 300 136 Allowance for doubtful receivables 218 102
Interconnection traffic 3,342 4,731 -Buildings 133 127
International and national roaming 730 820 Taxes (other than income tax) 21 93
Assets and liabilities held for sale include the following: Amortization of intangible assets  
Other services 666 411 Training expenses 48 58
Other operating expenses 328 207 -Licences 639 613
Link Egypt and Link Dot Net
In February 2009 the Company stated that they had received Total revenues from services 26,916 27,823 Total 1,203 955 -Other intangible assets 242 156
an indicative non-binding offer for the acquisition of 100% of the Total revenues from sale of goods 1,346 1,330 Total 5,477 4,981
shares of LINKdotNET and Link Egypt. In accordance with EAS 32 The increase in other expenses was primarily attributable to
the assets and liabilities held for sale in disposal groups have been Total 28,262 29,153 the increase in accruals for provisions, allowance for doubtful
receivables and other operating expenses during 2009. The Depreciation and amortization increased due to the increase in cell
separately shown in specific captions on the consolidated balance sites depreciation primarily as a result of an increase in investments
sheet. The income statement effects of these entities have not Revenues from telephony services decreased in 2009 compared increase in the allowance for doubtful receivables was mainly
to 2008 mainly as a result of a decrease in calling rates as part of related to a revision of allowance for doubtful debts policy in OTA. in the network.
been shown as discontinued operations as they do not represent a
separate major line of business. a marketing campaign due to competition with the other operators. While accruals for provisions included EGP 106 million relating
Revenues from interconnection traffic decreased in 2009 to the accruals for the tax dispute in Algeria. Taxes (other than
compared to 2008 mainly due to the sale of the Group’s gateway income tax) decreased mainly due to the sale of M-Link.
71

12- Impairment charges Gain from extinguishment of debt in 2009 relates to the tender sold 5% of its investment in this associate and the remaining
Impairment charges amounting to EGP 214 million in 2009 mainly relate offer by PMCL which was completed in May 2009 to repurchase investment was sold in January 2008.
to the impairment of EGP 96 million for plant and equipment in PMCL in a portion of its senior notes. As a result of this tender offer, PMCL
Pakistan and Link Dot Net Telecom, a subsidiary of PMCL operating in repurchased the notes at a repurchase price of US$ 730 per US$ 17- Income tax expense
Pakistan as well as impairment of goodwill amounting to EGP 33 million in 1,000 of principal amount. As a result of the transaction PMCL
Link Dot Net Telecom. The impairments in Link Dot Net Telecom are mainly cancelled debt of approximately US$ 138 million (equivalent
to EGP 770 million) for cash consideration of US$ 101 million 2009 2008
as a result of the uncertainties for the future expectations of this business.
(equivalent to EGP 564 million). The difference between the
Current income tax expense
13- Unusual Items repurchase price and carrying value of the debt was recorded as (2,270) (2,339 )
gain from extinguishment of debt, net of the effects of closing out Deferred taxes 131
During November 2009 Orascom Telecom Algeria S.p.A. and Ring derivatives associated with this debt. 257
Algeria LLC, subsidiaries of the Company, experienced damages to Income tax expense (2,013) (2,208)
shops, warehouses and infrastructure, as well as break-in to premises Financial income increased in 2009 mainly relating to the interest
and theft of equipment, during football related disturbances in Algeria. accrued on the loans to Globalive. (See Note 20 “Other financial Current income tax receivables and liabilities in the consolidated
assets” for further information). balance sheet are as follows:
The cost of damaged inventories, as a result of such disturbances,
amounted to EGP 100 million, whilst the damage to property and Financial expense increased mainly due to an increase in interest
equipment amounted to EGP 134 million. on bonds which related to the issuance of a US$ 230 million bond 2009 2008
(equivalent to EGP 1,267 million) (“Oscar Bond”) in February 2009  
Both entities have submitted formal claims to their insurance (see Note 26 “Borrowings”). Current income tax receivable 553
416
companies relating to this incident. Furthermore, a technical Current and non current income tax
assessment performed by an independent insurance expert stated liabilities (1.032) (2,124)
The gain in foreign exchange is mainly due to unrealized gain
that the minimum expected recovery from the insurance company on translation of supplier facilities, telecommunication license
is 1 billion DZD (equivalent to EGP 78 million). payables and borrowings due to the strengthening of the EGP,PKR The tax on the Group’s profit before tax differs from the theoretical
and DZD against the US$. amount that would arise using the weighted average tax rate
This incident is considered as an exceptional event which is out applicable to profits of the consolidated entities as follows:
with the normal course of operations and has been recorded in the Fair value changes on FX derivative instruments relates to the
income statement as unusual items. After considering the expected changes in the fair value of the cross currency swaps held by 2009 2008
minimum insurance proceeds, an amount of EGP 73 million has PMCL in connection with the economic hedge of borrowings Profit from continuing operations 4,209 5,050
been recorded as unusual inventory loss relating to the damaged
Tax calculated at Company›s income
inventories and an amount of EGP 84 million has been recorded as 16- Share of loss of associates and gain on disposal of associates 824 1,010
tax rate
unusual capital loss relating to the damaged property and equipment.
Share of loss of associates in 2009 and 2008 relates to the Different income tax rates in
investment in Globalive Canada Investment Holdings Corp. and 456
subsidiaries 536
14- Disposal of non-current assets Globalive Canada Holdings Corp. (collectively “Globalive”). The Theoretical income tax for the year 1,378 1,466
The gain on disposal of non-current assets amounting to EGP 232 Group holds a 65.4% investment in Globalive which comprises a
Permanent differences 123 87
million in 2009 mainly relates to the gain of EGP 196 million on combination of voting and non-voting rights. Considering direct
and indirect interests, the Group holds 65.4% of the outstanding Unrecognized deferred tax for tax
disposal of M-Link which was sold to Wind Telecomunicazioni SpA 279 493
shares and directly holds 33.2% of the voting rights. The Group losses
for a cash consideration of EGP 435 million during January 2009.
(See Note 34 “Related party transactions”) has significant influence over this investment and does not have Reversal of expired deferred tax assets
- 47
control over the financial and operating policies of Globalive. for tax losses
Gain on disposal of non-current assets amounting to EGP 363 Therefore the investment is equity accounted. Utilization of previously unrecognized
- (89)
million in 2008 mainly relates to the gain on the disposal of the deferred tax assets
The following table provides selected financial information of Unrecognized deferred tax liabilities on
subsidiary OrasInvest. During 2009 a further gain of EGP 43 million Globalive as of December 31, 2009 and 2008 and for each of the - 101
was recorded relating to a post acquisition sale price adjustment. unremitted earnings
years then ended. Prior period tax 250 -
15- Net financing costs 2009 2008 Other differences (17) 103
2009 2008 Current assets 353 2,065 Income tax for the year 2,013 2,208
Non-current assets 4,198 11 The Group’s income tax expense decreased from EGP 2,208
Interest on deposits and bank accounts 133 162
Current liabilities 1,080 2,242 million in 2008 to EGP 2,013 million in 2009 while the effective tax
Interest on non-current financial rate increased from 44% to 48%, respectively. The increase in the
63 84 Non-current liabilities 3,977 0
receivables effective tax rate was primarily attributable to the provision charged
Other financial income 209 36 Revenue 262 0 to Income tax expense during 2009 with an amount of US$ 30
Gain on extinguishment of debt 128 - Net loss (513) (159) million against the tax claims 2004-2007 which has been received
Dividends from investments - 9 % shareholding 65.4% 65.4% by Orascom Telecom Algeria S.P.A. (“OTA”).
Financial income 530 291
proportional share of net loss (335) (104)
Interest on bonds (592) (500) 0
Interest on other borrowings (1,913) (1,743) Amortization expense of identifiable
(17) 0
Interest on other liabilities and other assets
(347) (319)
financial expense Elimination of proportional share of
89 88
Financial expense (2,850) (2,562) intra group interest expense
Foreign exchange gain /(loss) 188 (1,936) Share of loss in associate (263) (16)
Fair value changes of FX derivative
(37) 835 Gain on disposal of associates in 2008 amounting to US$ 27
instruments
Net foreign exchange gain /(loss) 151 (1,101) million relates to the disposal of the remaining investment in
Total Hutchison Telecommunications International Limited (“Hutchison
(2,168) (3,372)
Telecommunications”). In October and November 2007 the Group
72

18- Property and equipment Additions to property and equipment in 2009 mainly relate to cell million, respectively, relating to the acquisition of property and
site investments and assets under construction relating to new equipment.
Computers, base stations, predominantly in GSM companies in Pakistan,
Land and fixtures Assets Under Bangladesh and Algeria. Those investments are mainly due to the Change in estimates
Cell Sites Total
Buildings and other Construction expansion of the business, increased capacity and the change in
equipment GSM technology. During the year ended 31 December 2009 the Group conducted an
operational efficiency review at one of its subsidiaries – Orascom
Cost
Property and equipment transferred to assets held for sale in 2009 Telecom Bangladesh Limited – which resulted in changes in the
As of January 1, 2009 994 32,812 1,811 5,289 40,906 expected useful lives of certain items in cell sites equipments.
relates to the property and equipment of Link-Egypt and Link dot
Additions 107 1,477 291 3,494 5,369 net See Note 6 “Assets and liabilities classified as held for sale” These equipments, which management previously intended to
for further information. depreciate over eight years of use, is now expected to remain in
Change in the scope of consolidation 5 155 19 28 207 use for fifteen years from the date of acquisition.
Assets held for sale - (313) (92) (15) (420) Property and equipment pledged as security for bank borrowings The effect of these changes on depreciation expense, recognized
amount to EGP 7.2 billion as of December 31, 2009 and primarily in income statement, in current and future periods as follows:
Disposals (145) (158) (87) (87) (477)
relate to securities for borrowings of PMCL, Trans World Associated
Currency translation differences (21) (1,037) (39) (118) (1,215) Private Limited (“TWA”), Orascom Telecom Tunisie S.A.(“OTT”)
Reclassifications 2 3,998 13 (4,013) - and Telecel Namibia “Cell one” . (in million of EGP) 2009 From 2010 to 2017 Later
As of December 31, 2009 942 36,934 1,916 4,578 44,370 (Decrease) increase in
In the year ended December 31, 2009 and 2008 the Group (45) (485) 530
Accumulated Depreciation and Impairment capitalized borrowing costs of EGP 201 million and EGP 344 depreciation expense
As of January 1, 2009 325 11,567 1,020 86 12,998
19- Intangible assets
Charge for the year 133 4,142 321 - 4,596
Change in the scope of consolidation 1 25 3 - 29 Licences Goodwill Others Total
Assets held for sale - (120) (39) - (159) Cost  
Disposals (69) (108) (74) - (251) As of January 1, 2009 10,302 6,741 1,518 18,561
Impairment loss 1 26 11 95 133 Additions - - 257 257
Currency translation differences (11) (431) (60) - (502) Change in the scope of consolidation 46 265 55 366
As of December 31, 2009 380 15,101 1,182 181 16,844 Assets held for sale - (48) (191) (239)
Net book value as of December 31, 2008 669 21,245 791 5,203 27,908 Disposals - - (38) (38)
Net book value as of December 31, 2009 562 21,833 734 4,397 27,526 Currency translation differences (173) (10) (26) (209)
As of December 31, 2009 10,175 6,948 1,575 18,698
Accumulated Amortization
Computers,
Land and fixtures Assets Under As of January 1, 2009 4,006 813 746 5,565
  Cell Sites Total
Buildings and other Construction Charge for the year 639 - 242 881
equipment Change in the scope of consolidation 5 - 5 10
Cost          
Assets held for sale - - (73) (73)
As of January 1, 2008 910 29,915 1,591 4,432 36,848
Disposals - - - -
Additions 214 1,752 454 6,479 8,899
Impairment Loss - 72 9 81
Change in the scope of consolidation (17) 302 (61) (22) 202
Currency translation differences (79) (2) 53 (28)
Assets held for sale (15) (86) (17) (8) (126)
As of December 31, 2009 4,571 883 982 6,436
Disposals (30) (224) (32) (45) (331)
Net book value as of December 31, 2008 6,296 5,928 772 12,996
Currency translation differences (90) (3,860) (149) (487) (4,586)
Net book value as of December 31, 2009 5,604 6,065 593 12,262
Reclassifications 22 5,013 25 (5,060) -
As of December 31, 2008 994 32,812 1,811 5,289 40,906
Accumulated Depreciation and Impairment          
As of January 1, 2008 247 9,044 819 49 10,159
Charge for the year 127 3,747 338 - 4,212
Change in the scope of consolidation 3 140 (40) - 103
Assets held for sale (4) (51) (10) - (65)
Disposals (3) (158) (16) - (177)
Impairment loss 2 1 1 37 41
Currency translation differences (47) (1,156) (72) - (1,275)
As of December 31, 2008 325 11,567 1,020 86 12,998
Net book value as of December 31, 2007 663 20,871 772 4,383 26,689
Net book value as of December 31, 2008 669 21,245 791 5,203 27,908
73

Licences Goodwill Others Total 2008

Central
Cost   North
Algeria Pakistan Egypt Tunisia Bangladesh and South Total
As of January 1, 2008 9,465 6,475 1,115 17,055 Korea
Africa
Additions 1,105 - 241 1,346
GSM 2,925 1,471 814 175 59 350 - 5,794
Change in the scope of consolidation 101 393 210 704
Telecom Services - 5 6 - - - - 11
Assets held for sale (4) (93) (18) (115) Internet & Fixed Line - - 123 - - - - 123
Disposals - - (38) (38) 2,925 1,476 943 175 59 350 - 5,928
Currency translation differences (365) (34) 8 (391)
20- Other financial assets
As of December 31, 2008 10,302 6,741 1,518 18,561
Accumulated Amortization 2009 2008
As of January 1, 2008 3,415 810 643 4,868 Non-current Current Total Non-current Current Total
Charge for the year 613 - 156 769 Financial receivables 3,729 101 3,830 2,302 940 3,242
Change in the scope of consolidation 17 - 5 22 Derivative financial 601 234 835 885 136 1,021
Impairment loss 169 5 2 176 instruments
Deposits 224 78 302 240 459 699
Assets held for sale - - (4) (4)
Disposals - - (2) (2) Financial assets held for - 191 191 - - -
trading
Currency translation differences (208) ( 2) (54) (264) Financial assets available 103 25 128 114 - 114
As of December 31, 2008 4,006 813 746 5,565 for sale
4,657 629 5,286 3,541 1,535 5,076
Net book value as of December 31, 2007 6,050 5,665 472 12,187
Net book value as of December 31, 2008 6,296 5,928 772 12,996 20.1 Financial Receivables and has incurred losses to date. The Group’s share of these
As of December 31, 2008 and 2009 financial receivables mainly losses is in excess of the carrying value of the investment. The
Additions to others in 2009 mainly relate to software licenses. control purposes. loans provided to Globalive are long term loans and have been
relate to loans provided to Globalive Management Corp (“GWMC”),
a subsidiary of Globalive (see Note 16 “Share of loss of associates considered to be a long-term interest forming part of the net
Additions to intangible assets in 2008 primarily relate to the The carrying amount as of December 31, 2009 was subject to an investment in Globalive. As of December 31, 2009 the amount
acquisition of a 3G license in Egypt, by Egyptian Company for impairment test to compare the carrying amount with value in use and gain on disposal of associates”).
outstanding under such loan agreements, including accrued
Mobile Services S.A.E. (“ECMS”) with a duration of 14 years and the recoverable amount. The goodwill of LinkDotNet Telecom During 2008 the Company entered into two loan agreements with interest, was CAD 723 million (equivalent to EGP 3,833 million),
validity, the group’s proportionate share is EGP 941 million and the was impaired during the year prior to performing this test. After Globalive Management Corp (“GWMC”, a subsidiary of Globalive) to the Group’s share of the excess losses of Globalive compared to
acquisition of a WiMax License by PMCL. having considered this previous impairment, no further evidence borrow an amount of up to CAD 508 million (equivalent to EGP 2,335 the carrying value of the investment have therefore been deducted
of impairment arose. Value in use was determined by discounting million ). Both loans are non-revolving term loans bearing interest from the long term receivable. After considering the share of such
Intangible assets pledged as security for bank borrowings amount the expected cash flows, resulting from business plans approved of Libor plus 18%. In 2009 the loan agreements were amended to losses the amount recorded in financial receivables is US$ 643
to EGP 6.9 billion and primarily relate to securities for borrowings by the respective Board of Directors, using the post-tax weighted increase the facility to CAD 608 million (equivalent to EGP 3,225 million (equivalent to EGP 3,410 million).
of PMCL and OTT. average cost of capital (WACC) as the discount rate. million ). As of December 31, 2008 the amount outstanding under
such loan agreements, including accrued interest, amounted to Financial receivables as of December 31, 2008 also include an
Impairment tests for goodwill Deferred tax assets on tax losses carry forwards mainly refer CAD 483 million (equivalent to EGP 2,220 million). During 2009 a amount of US$ 165 million (equivalent to EGP 913 million). relating
to income tax loss carry forwards of the Group’s subsidiaries in further amount of CAD 138 million (equivalent to EGP 732 million) to receivables from the sale of subsidiaries. This primarily relates
Goodwill is allocated to the individual CGU which reflects the Pakistan with no expiry date. was advanced under the original loan agreements. to the receivable from the sale of OrasInvest amounting to US$
minimum level at which the units are monitored for management 90 million, of which US$ 75 million (equivalent to EGP 413 million)
Globalive was awarded CAD 442 million of spectrum licenses in was settled in December 2009 and the residual receivable of US$
March 2009 and the loans are secured on a subordinated basis 75 million (equivalent to EGP 413 million) from the sale of Iraqna
The following table provides an analysis of goodwill by segment by an assignment of these licenses and are guaranteed on a non which was settled during 2009. As of December 31, 2009, the
2009 recourse basis. residual receivable from the sale of OrasInvest of US$ 15 million
Central Globalive launched its wireless network to the Canadian market in (equivalent to EGP 83 million) is due to be settled in 2010
North December 2009 and is therefore in the start-up phase of operations
  Algeria Pakistan Egypt Tunisia Bangladesh and South Total
Korea
Africa 20.2 Derivative financial instruments

2009 2008
GSM  2,925 1,464 814  175  59  573  -  6,010  Assets Liabilities Assets Liabilities
Telecom Services - 5 9 - - - - 14 Interest rate derivatives 6 545 - 624
Internet & Fixed Line - - 41 - - - - 41 Foreign exchange derivatives 738 - 981 -
2,925 1,469 864 175 59 573 - 6,065 Other derivative instruments 88 - 40 6
   
Total 832 545 1,241 630
   
Less non-current portion
Interest rate derivatives - 195 - 399
Foreign exchange derivatives 515 - 851 -
Other derivative instruments 83 - 34 -
Current portion 234 350 136 231
74

Interest rate derivatives 2010. As of December 31, 2009 the fair value of this derivative My Screen Mobile Inc Financial assets held for trading
The notional principal amounts of the outstanding interest rate asset was EGP 50 million. The changes in the fair value of the In May 2008, the Company concluded a “Restricted Stock Purchase
swaps that qualify for hedge accounting amounts to US$ 1.5 billion, derivative are recognized in foreign exchange loss / gain in the Agreement” with My Screen Mobile Inc, an entity specializing in the Financial assets held for trading relate to government treasury bills
relating to the A1 and A2 term loan supplements of the Company. income statement. delivery of advertising to mobile phones, to acquire 12.5 million and investment bonds purchased by PMCL.
Under the derivative contract the Company pays fixed interest rate shares which represents approximately 9% of the total share capital
and receives 6 month Libor. Gains and losses are recognized in Other derivative instruments and existing voting rights. Additionally, the Company purchased 21- Deferred taxes
the cash flow hedge reserve in equity. As of December 31, 2009 Other derivative instruments mainly include the warrants to purchase share warrants to acquire up to 20 million shares at an exercise Deferred income tax assets and liabilities are offset when there is
the fair value of the derivative liability was EGP 529 million. The shares of My Screen Mobile Inc and Lingo Media Corporation price of US$ 2 per share. The warrants can be exercised from the a legally enforceable right to offset current tax assets and liabilities
gain recognized in the cash flow hedge reserve, net of deferred tax amounting to EGP 11 million and EGP 2 million, respectively as of date of the agreement until May 23, 2012. The total purchase price and when the deferred income tax assets and liabilities relate to
during the year ended December 31, 2009, amounts to EGP 138 December 31, 2009. The details of these warrants are provided of the shares and warrants was US$ 10 million. Upon exercise of income taxes due to the same tax authority. The following table
million. below in the section “Financial assets available for sale”. the warrants, the Company would hold approximately 20% of the provides a reconciliation of deferred tax assets and liabilities of the
existing and potential voting rights. Based on an assessment of Group to the amounts included in the face of the balance sheet.
Additionally, during 2009 the Company entered into a switchable In February 2009 the Company issued equity indexed notes with the potential ownership percentage and other contractual rights,
interest rate swap for a notional amount of US$ 500 million to cover a nominal amount of US$ 230 million which mature in 2013. The management does not consider that it has significant influence over
2009 2008
a portion of the syndication loan. Under the derivative contract notes have a redemption price on maturity which is indexed to the the company. Therefore, the investment has been recorded as a
the Company receives a 25 basis point reduction in the floating Company’s GDR price. This feature of the debt is considered as financial asset available for sale and measured at fair value. As Deferred tax liabilities, gross 2,370 2,337
interest rate and at the end of the first year (September 23, 2010) an embedded derivative which is valued at fair value through profit of December 31, 2009 the fair value of the investment amounted Deferred tax assets offset (1,179) (913)
the bank has the right to either switch to a fixed rate swap (whereby and loss. As of December 31, 2009 the fair value of this embedded to US$ 2 million (equivalent to EGP 12 million) and the fair value
the Company will pay fixed rate interest and receive floating) or derivative asset was EGP 77 million. of the warrant amounted to US$ 2 million (equivalent to EGP11 Deferred tax liabilities 1,191 1,424
switch to a floating rate with a cap (whereby the Company will pay million). Deferred tax assets, gross 1,833 1,402
floating rates up to a cap strike of 4.15%). As of December 31, CDC Fennec Ltd, a lender to Moga has the option to convert all
Deferred tax liabilities offset (1,179) (916)
2009 the fair value of the derivative liability was EGP 16 million. amounts payable under the loan agreement into shares of the Lingo Media Corporation
.The changes in the fair value of the derivative are recognized in Company until the debt is extinguished. As of December 31, 2009 In August 2008, the Company entered into a subscription Deferred tax assets 654 486
financial income and expense in the income statement. The fair the amount due, recorded as liabilities to banks, amounted to EGP agreement to acquire 2,857,143 common shares of Lingo Media of which recognized
value of this derivative asset as of December 31, 2009 was EGP 160 million. As of December 31, 2009 and 2008 the fair value of 28 (121)
Corporation, a media entity focusing on online advertising. The directly in equity
6 million. this option was zero. investment represents approximately 23% of the total share
capital and existing voting rights. The Company also purchased The gross movement in the deferred income tax account is as
Foreign exchange derivatives Deposits share warrants to acquire up to 2,142,857 shares of this entity. follows:
Foreign exchange derivatives primarily relate to the economic Deposits primarily relate to letters of guarantee and other restricted The warrants can be exercised from the date of the agreement 2009 2008
hedge of PMCL. The cross currency swap relates to certain cash held as security for the performance of Group obligations. for a period of two years, at an increasing price from US$4 up to
The decrease in deposits in 2009 mainly relates to the liquidation US$8. The total purchase price of the shares and warrants was As of January 1, 938 1,393
borrowings of PMCL, which are swapped from US$ to PKR and
from Euro to PKR, whilst the associated interest is swapped from of deposits in Algeria for the payments of the dividend and the tax US$ 5 million. Assuming exercise of the warrants, the Company Exchange differences (68) (250)
LIBOR to KIBOR and from Euribor to KIBOR. The changes in the appeal. would have an interest of approximately 34% in this entity. Based
on an assessment of the contractual rights, management does Change in scope (105) 47
fair value of the derivative are recognized in foreign exchange loss
/ gain in the income statement. As of December 31, 2009 the fair Deposits are partially pledged as security against related bank not consider that it has significant influence over the company. Income statement charge (256) (131)
value of this derivative asset was EGP 689 million borrowings. Therefore, the investment has been recorded as a financial asset Tax charged directly to equity 28 (121)
available for sale and measured at fair value. As of December 31,
The following table shows the ageing analysis of financial 2009, the fair value of the investment amounted to US$ 3 million As of December 31, 537 938
Telecel Globe entered into a currency forward to hedge exposures
to movements in Namibian Dollars in relation to the purchase price receivables and long term deposits as of December 31, 2009 and (equivalent to EGP15 million) and the fair value of the warrants,
2008: which is recorded in derivative financial assets, amounted to US$ The movement of deferred tax assets and liabilities during the
to be paid for the investment in PowerCom Namibia. The final year, without taking into consideration any offsetting is provided in
installment of the purchase price was due to be paid in January 0.4 million ( equivalent to EGP2 million ).
the tables below:
2009 2008
Depreciation and Unremitted
Financial Financial Deferred tax liabilities Other Total
Deposits Deposits amortization earnings
receivables receivables
Not past due 302 3,830 699 2,827 As of December 31, 2008 1,850 443 44 2,337
Past due 0-30 days - - - - Charged / (credited) to the income statement 100 (95) 184 189
Exchange differences (167) (17) 33 (151)
Past due 31-120 days - - - 415
Change in scope (5) - - (5)
302 3,830 699 3,242
As of December 31, 2009 1,778 331 261 2,370

Financial assets available for sale Depreciation

Tax Accrued Impairment Fair
Company name ownership % December 31, 2009 December 31, 2008 Deferred tax assets and Provisions Other Total
losses expense of assets value
  amortization
Smart Village (ECDMIV) 10% 44 44
As of December 31, 2008 840 195 122 46 42 121 36 1,402
My Screen Mobile Inc 9% 12 22
Lingo Media Corporation 23% 15 17 Charged / (credited) to the income
(33) 11 -
statement 413 28 6 17 442
Top Level Domain Co. 5% 6 6
Other investments 51 25 Charged directly to equity - - -
- - (28) - (28)
128 114 Change in scope - - -
100 - - - 100
Exchange differences (25) (7) - (7) - - (44) (83)

As of December 31, 2009 1,328 216 89 50 42 99 9 1833

75

No deferred tax assets were recognized on income tax loss carry The following table shows the ageing analysis of trade receivables On October 22, 2009, the Extraordinary General Meeting approved 25-3 Treasury shares
forwards for some foreign subsidiaries, mainly Orascom Telecom as of December 31, 2009 and 2008, net of the relevant a share capital reduction through the cancellation of 10,302,769 As of December 31, 2008 the Company had 17,681,700 shares
Bangladesh Limited (“OTB”) and CAT, as it is currently not probable provision for doubtful receivables: treasury shares (856,624 local shares and 1,889,229 GDR’s) which were held as treasury shares, during 2009 the following
that taxable profit will be available in the near future against which amounting to EGP 424 million. movements took place:
such tax loss carry forwards might be utilized. 2009 2008 The legal reserve connected with the cancelled shares including • As previously explained, the Company cancelled 10,302,769
Not past due 677 852 currency translation differences was reclassified from other
Generally the Group does not recognize deferred tax assets for treasury shares on October 22, 2009 (comprising 856,624
temporary differences related to accruals for provisions, due to Past due 0-30 days 476 393 reserves to retained earnings. local shares and 1,889,229 GDR’s) and distributed the
uncertainties in connection with the tax treatment of such expenses, Past due 31-120 days 449 353 equivalent of 10,168,861 local shares from treasury stock
Accordingly, as a result of the above transactions, as of December
as they might be challenged by local tax authorities. Past due 121 - 150 days 22 50 31, 2009 the issued and paid up share capital amounted to EGP as payment of the dividend.
Past due more than 150 days 204 165 889 million (comprising 889,100,105 shares) of a nominal value of
No liability has been recognized in respect of temporary differences • During the year ended December 31, 2009 the Company
Trade receivables 1828 1,813 EGP 1 per share.
associated with investments in subsidiaries, branches and also purchased the equivalent of 7,240,310 local shares
associates and interests in joint ventures, where the Group is in The maximum exposure to credit risk at the reporting date is the from the market to be held as treasury shares and sold the
25-2 Dividends equivalent of 4,450,380 local shares to the market.
a position to control the timing of the reversal of the temporary carrying value of the receivable. The Group does not hold any
differences and it is probable that such differences will not reverse collateral as security. The shareholder’s meeting of the Company held on June 7, 2009
in the foreseeable future. approved a dividend distribution of EGP 1 per share in the form of As a result of the above transactions there were no treasury shares
23- Other current assets cash and/or shares. Based on the announced distribution ratio of as of December 31, 2009.
The following table provides a breakdown by estimated 36:1; on August 27, 2009 the Company distributed 243,376 shares
2009 2008 to local shareholders and 1,985,097 shares to the GDR holders 25-4 Share based compensation plan
recoverability of recognized deferred tax assets and liabilities:
Prepaid expenses 494 428 (equivalent to 9,925,487 local shares). As of December 31, 2008 the Company had 3,661,785 shares
Advances to suppliers 67 89 Consequently, the Company distributed in cash an amount of which were held for the purposes of the share based compensation
Deferred tax liabilities Deferred tax assets Receivables due from tax authority 1,018 84 EGP 180 million for a total number of local shares of 180,111,604 plan. During the year ended December 31, 2009 the Group
2009 2008 2009 2008 Deferred cost - 78 (EGP 1/share) and an amount of US$ 60 million for a total number acquired 1,235,735 of its own shares for the purposes of the
within 1 year 77 276 33 4 Other receivables 777 953 of 66,337,438 GDRs (equivalent to 331,687,192 local shares) share based compensation. Share grants exercised during 2009
within 1 - 5 (around US$ 0.9022/GDR). resulted in 950,220 shares.
1,339 1873 1,800 1391 Allowance for doubtful current assets (272) (255)
years Total 2,084 1,377
after 5 years 954 188 - 7 The dividend distribution in 2008 amounted to EGP 1 per share As a result of the above transactions, as of December 31, 2009 the
(EGP 5 per GDR) and was paid in cash on June 5, 2008. Company had 3,947,300 shares held as treasury shares for the
2,370 2,337 1,833 1402 The increase in receivables due from tax authority is mainly related
to down payments against the tax claim received by OTA covering purposes of the share based compensation plan. The fair market
22- Trade receivables the years 2004-2007. 26- Borrowings value of such shares was EGP 501 million.
2009 2008
The following table shows the movement in the allowance for other
Receivables due from customers 975 916 current assets: within one after 5
Receivables due from telephone 1-2 years 2-3 years 3-4 years 4-5 years Total
539 506 year years
operators 2009 2008
Accrued revenue (unbilled) 437 422 At January 1 255 148 As of December 31, 2009
Receivables due from authorized Exchange differences (3) (1) As of December 31, 2008
64 92 Additions (allowances recognized as
dealers 29 11 Liabilities to banks 4,616 4,573 5,352 9,117 880 114 24,652
Other trade receivables 277 250 an expense)
Allowance for doubtful receivables (464) (373) Use  (9) - 2,390 2,588 4,130 5,231 8,966 1,162 24,467
Total 1,828 1,813 Reclassifications 97 Bonds 417 70 1,088 1,267 4,072 - 6,914
At December 31, 272 255
The following table shows the movement in the allowance for 196 282 75 346 1,398 4,080 6,377
doubtful receivables 24. Cash and cash equivalents Derivative instruments 350 177 23 (5) - - 545

231 200 127 64 8 - 630
2009 2008 2009 2008
Other borrowings 100 19 - - - - 119
At January 1 373 484 Bank accounts 2,277 2,929
Exchange differences (15) (30) Deposits 1,893 387 113 30 39 32 36 - 250
Additions (allowances recognized as an Treasury bills - 277 Total as of December 31, 2009 5,483 4,839 6,463 10,379 4,952 114 32,230
218 102
expense) Cash on hand 14 15 Total as of December 31, 2008 2,930 3,100 4,371 5,673 10,408 5,242 31,724
Change in scope (27) (1) Total 4,184 3,608
Use (59) (73) Liabilities to banks chartered bank Pakistan as the agent, repayments of principal
Reversal (26) (11) Cash and cash equivalents as of December 31, 2009 were amount starts from November 9, 2010 and the financing period will
Reclassifications - (98) unusually high mainly due to undistributed dividends at Orascom Appendix A includes a detailed analysis of liabilities to banks as of last for 4 years.
At December 31, 464 373 telecom Algeria “OTA” and Mobinil amounted to EGP 1,339 million. December 31, 2009.
In addition, during the 2009, OTH and some of its subsidiaries
Deposits includes an amount of DZD 10,201M equivalent to EGP In addition to the normal scheduled repayments of borrowing obtained new short term facilities. As in OTH obtained a nominal of
772 million representing the remaining agreed amount not to be facilities, in accordance with the relevant agreements, various US$ 140 million, equivalent to EGP 771 million.
repatriated until the Algerian tax authority “DGE” issue a clearance Group companies (mainly OTH, PMCL, ECMS and Bangladesh)
certificate in relation to the tax position of OTA (see note 35). entered into new borrowings during the year in order to finance
license payments, ongoing operations and capital expenditure Bonds
25- Share Capital programs.
Appendix B includes a detailed analysis of Bonds as of December
25-1 Authorized and issued share capital and legal reserves Pakistan Mobile Communication Limited 31, 2009. Changes in bond liabilities during 2009 primarily relate
As of December 31, 2008 the issued and fully paid share capital PMCL entered into a syndicate loan agreement with Pakistani to the repurchase by PMCL of a portion of its Senior Notes and
amounted to L.E. 899 million (equivalent US$ 261 million) banks for a facility amounting to PKR 5.1 billion equivalent to US$ the issuance of an equity indexed bond Orascom Telecom Oscar
comprising 899,402,874 shares of a nominal value of L.E. 1 per 61 million ,equivalent to EGP 336 million to dealing with standard Luxembourg (the “Oscar Bond”).
76

Pakistan Mobile Communication Limited facility with accession to the security pool under the Security Share 28- Trade payables 30- Business combinations
In May 2009 PMCL completed a tender offer to repurchase a Agreement. The notes have a redemption price at maturity 2009 2008 During 2009 the Group acquired 100% of share capital of
portion of its 8 5/8% Senior Notes amounting US $ 250 million, Capex payables 2,591 3,622 Power-COM (Cell One) in Namibia, a GSM telecommunications
equivalent to EGP 1,377 million due 2013. PMCL repurchased the indexed to Orascom Telecoms’ GDR which may potentially allow operator in Namibia through its subsidiary Telecel Globe, for a
the Group to further reduce financing costs of the notes. Trade payables due to suppliers 1,480 1,438
notes at a repurchase price of US$730 per US$1,000 of principal Trade payables to telephone operators 535 409 cash consideration of US$ 60 million. The acquired business
amount. As a result of the transaction PMCL cancelled debt of contributed revenues of US$ 14 million and net loss of US$ 19
Derivatives Other trade payables 1,139 1,098
approximately US$ 138 million for cash consideration of US$ 101 million to the Group in the period since acquisition.
million. Details of the derivative liabilities are provided in Note 20 “Other Total 5,745 6,567
financial assets”. Trade payables are all due within one year. The purchase price for this acquisition was US$ 60 million of which
Orascom Telecom Oscar US$ 30 million was paid during 2009 and the remaining portion will
Other Borrowings 29. Earnings per share be paid in 2010. The purchase price allocation was finalized on
In February 2009 the Oscar Bond was issued with a nominal (a) Basic December 2009.
amount of US$ 230 million, equivalent to EGP 1,267 million Other borrowings mainly include promissory notes and loans from The following table provides details of this acquisition
maturing in 2013, through a fully subscribed private placement. minority shareholders in subsidiaries. Basic earnings per share is calculated by dividing the profit
The notes carry a coupon of US$ Libor plus a margin of 500bps attributable to equity holders of the Company by the weighted The following table provides details of main acquisitions during
and rank pari-passu to the existing US$2.5bn senior secured credit average number of ordinary shares outstanding during the year, 2009:
excluding ordinary shares purchased by the Company and   Cell One
Currency and Interest Rate Information of Borrowings held as treasury shares or for the purposes of the share based
Cash and cash equivalents -
compensation.
Egyptian Pakistan Bangladeshi Algerian Tunisian Property and equipment 179
US$ Euro Others Total Intangible assets 84
Pound Rupee Taka Dinar Dinar   2009 2008
Deferred tax assets 100
As of December 31, 2009 Profit Attributable to the equity holders
1,845 2,464 Inventories 6
Total borrowings by currency of issue 23,314 1,989 2,543 3,168 562 148 204 302 32,230 of the Company (in million of EGP) Trade receivables 17
Notional amount of currency derivatives (975) (1,520) - 2,495 - - - - - Weighted average number of shares (in Other current assets 6
878 937
millions of shares) Non-current borrowings (179)
Borrowings after derivative effect 22,339 469 2,543 5,663 562 148 204 302 32,230
Earnings per share – basic (in EGP) 2.10 2.63 Other non-current liabilities (33)
of which (after derivative effect):
Current borrowings -
floating rate borrowings 9,165 455 2,215 5,663 562 148 198 - 18,406 (b) Diluted
Other current liabilities -
fixed rate borrowings 13,174 14 328 - - - 6 302 13,824 Diluted earnings per share is calculated by adjusting the weighted Trade payables (95)
As of December 31, 2008 average number of ordinary shares outstanding to assume Current income tax liabilities -
conversion of all dilutive potential ordinary shares. During 2008 Net identifiable assets acquired 84
Total borrowings by currency of issue 22,266 2,332 2,963 3,187 336 287 304 49 31,724
and 2009 the dilutive potential ordinary shares relate to the share Goodwill 251
Notional amount of currency derivatives (1,746) (1,687) - 3,433 - - - - - based compensation plan. Purchase price 335
Borrowings after derivative effect 20,520 645 2,963 6,620 336 287 304 49 31,724 2009 2008 Cash and cash equivalents in subsidiary acquired  
of which (after derivative effect): Profit Attributable to the equity holders of Cash outflow on acquisition 335
1,845 2,464
the Company (in million of EGP) In the third quarter of 2009 the purchase price allocation was
floating rate borrowings 6,141 601 2,537 6,616 335 287 295 - 16,812
Weighted average number of shares in finalized for the acquisition of U-com Burundi SA and Telecel
fixed rate borrowings 14,379 44 426 4 1 - 9 49 14,912 878 937
issue (in million of shares) Afrique SA which were purchased in July 2008. The comparative
Financial liabilities include secured liabilities of EGP 22,537 million and equipment of the relevant subsidiary, pledged shares and Adjustments for: amounts for 2008 were restated compared to those reported in the
as of December 31, 2009 and 21,566 million as of December 31, receivables. - Shares granted (in millions of shares) 4 2 2008 annual consolidated financial statements as follows:
2008. In general, the financial liabilities are secured on property Weighted average number of shares for
27- Other liabilities diluted earnings per share (in millions of 882  939
shares)
2009 2008 Earnings per share – diluted (in EGP) 2.10 2.63
Current Non-current Total Current Non-current Total
December 31, 2008 December 31, 2008
      PPA adjustment
(as reported) (adjusted)
Telecommunication license payable 1,561 442 2,003 1,120 1,070 2,190 Property and equipment 27,930 (22) 27,908
Taxes (Other than income taxes) 1,257 - 1,257 1,051 - 1,051 Intangible assets 12,927 69 12,996
Deferred tax liabilities 1,377 47 1,424
Prepaid Traffic and deferred income 1,307 - 1,307 1,065 - 1,065
Due to local authorities 716 - 716 346 - 346 share. The Company is listed on the Egyptian Stock Exchange 31- Interest in joint ventures
Personnel payables 425 - 425 293 - 293 and also has GDR’s (where one GDR is equivalent to 5 local
shares) listed on the London Stock Exchange. The Group has the following interest in its joint ventures:
Other 740 220 960 862 147 1,009
Country of
Total 6,006 662 6,668 4,737 1,217 5,954 Joint venture Shareholding
domiciliation
* On July 16, 2009 Middle East and North Africa Submarine Cable 29 million equivalent to EGP 160 million recorded as a deferred Egyptian Company for Mobile
34.67% Egypt
Systems – MENA Cable ( fully owned subsidiary ) signed an income. Services S.A.E.
agreement with Gulf Bridge International –GBI to sell fiber pair Orascom Telecom Tunisie S.A. 50.00% Tunisia
and Indefeasible Right of Use (IRU) with an amount of US$ Consortium Algerian
97 million equivalent to EGP 534 million. Under this agreement 50.00% Algeria
Telecommunication S.P.A.
GBI should pay a milestone payments against a commitments
from MENA Cable to fulfill certain conditions. As of the date of
the financials the amounts received from GBI amounted to US$
77

Orascom Telecom Tunisia S.A. (“OTT”) 32. Commitments The ESOP was introduced in 2003 and the Company since then GDRs are granted for free and must be exercised within two years
uses treasury shares bought from the market to cover the plan. after the end of the vesting period. Exercise of an award is subject
OTT operates a GSM network in Tunisia and provides a range of The commitments as of December 31, 2009 and 2008 are provided The Board of Directors of the Company has appointed a Committee to employment in the Group at the exercise date. The Group has
pre-paid and postpaid voice and data telecommunication services in the table below: that can grant GDR options or GDRs to employees of the Company no legal obligation to repurchase or settle the awards in cash.
under the brand name “Tunisiana”. The Company has a 50% and its subsidiaries through Orascom Telecom ESOP Limited., GDRs were valued using the Black-Scholes option-pricing model.
shareholding in OTT through two wholly-owned subsidiaries which As of As of Malta, a wholly owned subsidiary. Such GDRs of the Company are The assumptions for calculations of the fair value per GDR at the
own 35% and 15% of the shares in OTT. The remaining 50% December31, December 31, listed on the London Stock Exchange and denominated in US$. grant date include the GDR price at each grant date, nil exercise
interest is held by National Mobile Telecommunications Company Awards under the ESOP are generally reserved for employees at price, a GDR price volatility between 29.0% and 72.6%, a dividend
2009 2008
KSC which is owned by Qatar Telecom. a senior management level and above that have spent at least one yield of between 1% and 3.5% and an annual risk free rate between
Intangible assets 750 766 full year of services in the Company and that have a satisfactory 1.7% and 6.4%.
Consortium Algerian Telecommunication S.P.A. “CAT) Property and equipment 1,129 1,870 performance according to their appraisal reports. The Company
Others - 604 has made annual grants on July 1 each year since 2003; from 2007 The following table provides a breakdown of the movements of
CAT is a landline operator in Algeria. The current intention of the onwards additional GDRs were granted on January 1 to existing outstanding GDR options and GDRs granted and their weighted
management of CAT is to liquidate this business. Therefore the Total 1,879 3,240 employees. The GDRs granted vest in three installments over the average exercise price:
Group has fully written down all assets relating to this business. vesting periods that vary from 12 to 42 months. Starting from 2005
Commitments for the purchase of intangible assets mainly relate
The following amounts represent the assets, liabilities, revenues to commitments of Egyptian Company for Mobile and Service   2009 2008
and profit for the year of the joint ventures. They are included in the amounting to EGP 597 million primarily relating to costs connected
Average Average
balance sheet and income statement of the Group’s consolidated with the 3G license .
exercise GDRs exercise GDRs
financial statements according to its shareholding in each joint price in GDR options granted for price in GDR options granted for
venture. Commitments for purchase of property and equipment mainly  
relate to commitments of Menacable amounting to EGP 463 million US$ per (thousands) free US$ per (thousands) free
relating to the purchase of marine cables and related equipment GDR option (thousa nds) GDR option (thousands)
2009 2008 and EGP 331 million for Egyptian Company for Mobile and Service granted granted
Revenues 14,793 13,979 relating to the purchase of equipment. At January 1 9.20 4 504 9.20 80 478
Profit for the year 2,793 1,352 Granted 467 - - 140
Current assets 3,104 2,635 The following table provides the future aggregate minimum lease
Forfeited (90) - - (6)
Non-current assets 16,414 15,869 payments under non-cancellable operating leases:
Exercised 9.20 (158) 9.20 (76) (108)
Current liabilities 9,039 7,328 Expired - - -
Non-current liabilities 5,457 7,400 2009 2008
 
Within one year 215 152
At December 31 - 4 723 9.20 4 504
Between 1-5 years 832 650
thereof exercisable - 4 198 4 20
After 5 years 83 227
1,129 1029 The weighted average GDR price during 2009 amounted to US$ The following table details the range of exercise prices and the
33. Share based compensation 25.14 (2008; US$ 48.65). weighted average remaining contractual life of outstanding awards
as of December 31, 2009 and 2008:
The following table provides a summary of the Company’s existing Executive Share Option Plans (ESOP), not expired as of December 31,
2009:   December 31, 2009 December 31, 2008
Weighted Weighted
Weighted Weighted
GDR market Fair value Number average average Number
GDRs Vesting Contractual GDR price Range of exercise price in average average
price at of GDRs at of GDRs remaining exercise of GDRs
Grant date Tranche granted period term at grant date US$ exercise remaining life
grant date in grant date in (thousands) life in price in (thousands)
(thousands) (months) (months) in US$ price in US$ in months
US $ US$ months US$
July 1, 2004 3 4 42 66 9.20 9.29 4.79 9.20 9.20 4 - 9.20 4 12
July 1, 2005 2 20 30 54 - 50.70 49.20 nil Nil 723 29 nil 504 36
July 1, 2005 3 2 42 66 - 50.70 48.71
July 1, 2006 3 31 42 66 - 40.80 39.20 The table below sets forth the awards outstanding as of December
January 1, 2007 2 7 24 48 - 66.00 62.98 31, 2009 and their expiry dates:
January 1, 2007 3 35 36 60 - 66.00 62.36 Exercise price in US$ per GDRs (thousands)
Expiry date - December 31
July 1, 2007 1 9 18 42 - 64.90 63.61 GDR 2008 2007
July 1, 2007 2 44 30 54 - 64.90 62.98  
July 1, 2007 3 36 42 66 - 64.90 62.36 2010 0 - 9.20 24 179
January 1, 2008 2 21 24 48 - 83.00 79.07 2011 - 18 180
January 1, 2008 3 22 36 60 - 83.00 78.19 2012 - 453 100
July 1, 2008 1 8 18 42 - 62.90 60.81 2013 - 130 25
July 1, 2008 2 18 30 54 - 62.90 59.84 2014 - 79 -
July 1, 2008 3 14 42 66 - 62.90 58.90 2015 - 23 -
January 1, 2009 1 314 12 36 - 27.29 26.39 Total   727 484
January 1, 2009 2 50 24 48 - 27.29 25.44 Telecel Globe Limited established a share option program that capitalization by an amount of USD 50,000,000. Based on these
January 1, 2009 3 50 36 60 - 27.29 24.53 entitles two key management personnel to purchase shares in terms, the value of both options amounts to USD 1,500,000 for
July 1, 2009 1 4 18 42 - 28.40 26.25 the Company. In accordance with this program, the employees each employee respectively.  The fair value of the two options at
July 1, 2009 2 15 30 54 - 28.40 25.18 are being granted an option to purchase all of the “Option Shares” grant date is, therefore, equivalent to USD 3,000,000, to be settled
July 1, 2009 3 23 42 66 - 28.40 24.41 in consideration of the payment of USD1.  The Option shares in shares.
represent the number of shares, at a nominal value of USD1
each, in the capital of the Company which shall be equivalent to During 2009, both employees have exercised their respective
3% of the capital of the Company calculated immediately upon its
78

share options. In order to satisfy these options, Telecel Globe Limited would buy 3,000,000 shares at a nominal value of USD1 each, transactions with OTT and ECMS relating to interconnection traffic the Company is a party in a number of legal cases which resulted
currently held by Orascom Telecom Holding and deliver them to these employees in accordance with the share option plan. Accordingly, and the sale of handsets. from carrying out its activities. Based on the legal advice obtained,
the percentage of ownership of Orascom Telecom Holding in Telecel Globe Limited diluted by 6%.”     the Company’s management believe that the outcome of these
Transactions with Associates of the Group lawsuits, individually or in aggregate, would not be material to the
34. Related party transactions Group’s results.
OTH provided financing to GWMC, an associate of the Group,
Transactions with subsidiaries, associates, with the Parent Company and its subsidiaries and other related parties are not considered in connection with the funding of the acquisition of the spectrum PMCL tax claims
atypical or unusual, as they fall within the Group’s normal course of business and are conducted under market conditions that would be licenses. For further details see Note 20 “Other financial assets”.
performed by independent third parties. PMCL is involved in proceedings regarding tax claims up to the
Transactions with other related parties year 2007 whereby the tax authorities conducted assessments
The main related party transactions are summarized as follows: by curtailing expenditure claimed by PMCL. PMCL has a tax
Sale of services and Purchase of services The Group is indirectly controlled by the Sawiris family. Transactions claims up to the year 2007 that the tax authorities either framed
  Interest income with entities under the control of the Sawiris family mainly refer or assessed. However, the company has field appeals to the
goods and goods
to transactions with Orascom Constructions Industries, Orascom appellate authorities against the re-assessment orders. The
  2009 2008 2009 2008 2009 2008 Technology Solutions, Orascom Trading and Orascom Training & disputed demand against the assessments framed/aggregates
Weather Investments Group Technology. to Rs 1,921 million equivalent to US$ 22.8 million, equivalent to
Weather Investments 69 66 - 1 - - EGP 126 million .The company has provide a provision for such
Wind Telecomunicazioni SpA 17 197 6 33 - - Transactions with Orascom Technology Solutions mainly refer to assessments with an amount of Rs 163 million equivalent to US$
WIS sarl 437 - 364 - - - maintenance activities of electronic hard- and software carried out 1.82 million ,equivalent to EGP 10 million.
Joint ventures for the Group. Orascom Constructions Industries and Orascom
ECMS 42 16 - - - - Trading mainly provide maintenance and construction services OTA tax claims
for the buildings the Group is working in, whereas transactions
OTT 20 93 3 203 - -
with Orascom Training & Technology mainly include management OTA has received a final tax assessment relating to 2004 tax year
Associate training programs. amounted to DZD 3,948 million equivalent to US$ 54.3 million
GWMC - - - - 179 49 ,equivalent to EGP 299 million .The Company field a claim against
Other related parties A balance of EGP 33 million is outstanding due form on of the the tax authority after the payment of 20% of final tax assessment .
Orascom Construction Industries - - 11 16 - - board members which will be settled against his esop plan when
Summit Technology (Orascom Technology vested On January 2010 the company received a refusal on it’s objection
- - 41 27 - - dated June 2009 according to the Algerian tax laws and procedures
Solution)
Orascom Trading - - 64 55 - - Key management compensation the company has 4 months from date of receipt to re-object the
Orascom Training & Technology - - 1 66 - - refusal .A provision with an amount of DZD 709 million equivalent
Key management includes executive and non executive directors to US$ 9.8 million, equivalent to EGP 54 EGP was accounted for,
Contrack Facilities Management - - 4 - - -
of the Board of Directors of the Company, the Company’s chief considering that most of the tax assessment is excessive.
Total 585 372 494 401 179 49 financial officer, other managing directors considered key personnel
and the chief executive officers of significant subsidiaries and joint On November, 2009, OTA received a final tax assessment of the
Receivables Payables ventures. years 2005 until 2007, amounting to 43,910 M DZD equivalent to
2009 2008 2009 2008 US$ 603.7 million, equivalent to EGP 3,325 million (Most of the
The compensation paid or payable to key management for amount (85%) is due to the reject of accountancy), The DGE (Tax
Weather Investments Group employee services is shown below: Department for large scale companies ) reject the books and
Weather Investments 26 77 2 6 reconstituted the revenue on a unilateral basis .OTA has appealed
Key management compensation 2009 2008 the assessments after the payment of 20% of final tax assessment.
Wind Telecomunicazioni SpA 4 33 20 22
WIS sarl 147 - 90 - Salaries and other short-term
61 60 OTA accrued a provision of 2,957 M DZD equivalent to EGP 225
Rain Srl 8 - 9 - employee benefits million, equivalent to US $ 41 million , according to an external
Joint ventures Equity settled share based expert report. The report assumes that the reject of accounting is
11
ECMS 6 28 1 6 payments arbitrary and the related tax assessment has been disregarded by
OTT 2 11 - 28 the expert its own estimate. The assessed 2,957 MDZD amount
Egyptian Company for Mobile Services S.A.E. (“ECMS”) refers to formal tax miscomputation made by OTA.
Associate
GWMC 3,542 2,220 - - ECMS is a mobile telecommunication operator in Egypt and provides On March 7, 2010 OTA received a rejection on its submitted
Other related parties a range of prepaid and postpaid voice and data telecommunication administrative appeal filed on December 2009 . In order to file its
Orascom Construction Industries - - 2 6 services under the brand name of Mobinil. The Company has an second appeal, Algerian law requires OTA to pay another 20% of
Summit Technology (Orascom Technology investment of 34.67% in ECMS and the France Telecom Group the remaining balance of the taxes and penalties alleged to be
5 5 5 6
Solution) also has an investment of 36.34%. The remaining shareholding is owing in order to appeal the decision before the Commission
Orascom Trading 1 - 7 11 publicly traded on the Cairo and Alexandria Stock Exchange. Central, this shall amount to approximately $110 million, equivalent
Gemini 1 - - - to EGP 606 million and shall be paid shortly by OTA from its own
Total 3,742 2,374 136 85 Legal proceedings are currently in progress relating to a resources.
disagreement regarding the Shareholders Agreement entered into
by the Company and France Telecom, Further details are included Pioneer Investment Ltd
Transactions with Weather Investments Group Company sold its investment in M-Link to TLC SERVIZI S.p.A now in Note 32 “Commitments”.
(Wind International Services S.p.A.), a wholly owned subsidiary of 35- Contingent assets and liabilities Fastlink Jordanian tax dispute:
The Group is directly controlled by Weather Investments. Wind Telecomunicazioni S.p.A for a cash consideration of EGP 435 The Jordanian Tax Authority initiated court claims for JD 49.2
Transactions with Weather Investments and its subsidiaries million. Following the acquisition the name was changed to WIS The Group is subject to various legal proceedings and claims million (approximately EGP 353 million), equivalent to Euro 44
mainly relate to management fees charged by the Company and sarl. Transactions with M-Link since the sale are disclosed in the which arise in the ordinary course of business due to the nature of million, equivalent to USD 64 million in income tax against Pioneer
interconnection traffic between the Group and the subsidiaries of line “WIS Sarl the operations of the Group and the nature of the markets where Investment Ltd. In connection with the sale of fast link (Jordanian
Weather Investments, and particularly Wind Telecomunicazioni the Group operates. Mobile Telecommunication service) in 2002 to MTC, a wholly
SpA. Transactions with Joint Ventures of the Group owned subsidiary of OTH.
The Group recognizes a provision for losses and liabilities when
In addition to the information presented above, in January 2009 the Transactions with joint ventures of the Group mainly refer to the existence is certain or probable. As of December 31, 2009
79
Orascom Telecom Iraq Disposal Warranties
Orascom Telecom Iraq upon the disposal of its investment in
(Iraqna for Mobile Services-subsidiary) the company provided
warranty to the purchaser of the investment. This warranty, which
in respect of tax covenant claims, of which no more than USD 60
million equivalent to EGP 331 million shall be payable in relation
to tax covenant claim.
Mobinil
Dispute with France Telecom (and subsidiaries) regarding Mobinil:
OTH’s position, relaying on the legal advice, is that the deadline
for concluding the sale ordered by ICC award issued on March 10,
2009 (the ‘Award’) has time-expired as a matter of Egyptian law in
light of the failure of France Telecom’s (or subsidiaries thereof) to
conclude the sale during the 30 day period stipulated in the Award.
Currently OTH Management cannot estimate the financial impact
of this event on the financial statements of the Company.
Telecom Egypt Interconnection Prices
Telecom Egypt filed a complaint with the dispute resolution
committee of the National Telecommunication Regulatory Authority
(NTRA), with the purpose of changing its interconnect prices
with the mobile operators, with which it has existing contracts.
We responded to the complaint in front of the committee asking
to honor the existing effective contract between the Company
and Telecom Egypt. The NTRA issued a ruling on the dispute on
September 3, 2008 in favor of Telecom Egypt by changing the
interconnect prices between the fixed and mobile networks to be
effective from that date.
The Company informed the NTRA of objection and rejection of the
decision as it has no legal or contractual basis and that we intend
to bring the matter to the courts in order to protect our interest.
On November 01, 2008 a law suit against the NTRA was filed in
the Administrative Court at the State Counsel asking for staying
and nullifying the NTRA decision.
On September 3, 2009 and based on the interconnect agreement
(article (25) first paragraph) the Company filed an arbitration
against Telecom Egypt according to the rules of The Cairo
Regional Center for International Commercial Arbitration in order
to settle the existing dispute between the two parties. On October
9, 2009 Telecom Egypt sent an initial response and a counterparty
claim related to the arbitration notification filed against it.
On January 5, 2010 a letter from NTRA was received with the
purpose of making new changes in the interconnect prices
between the different operators to be applied retroactively from
September 1, 2009. The letter was based on the September 03,
2008 decision. On January 14, 2010 the company sent a letter to
NTRA refusing this decision.
The company and its external legal counsel believe that the
Company has a strong legal position as the NTRA’s decision does
not have legal or contractual ground, hence we continue to record
interconnect revenue and costs based on the existing agreement
with Telecom Egypt and other mobile operators.
The company applied these decisions would have recorded less
interconnect revenue the group proportionate share amounts to
EGP 49 equivalent to 9M US$ , less interconnect cost the group
proportionate share amounts to EGP 17M equivalent to 3M US$, for
the financial year ended December 31, 2008 and less interconnect
revenue the group proportionate share amounts to EGP 168M
equivalent to US$ 30.5 million and less interconnect cost the
group proportionate share amounts to EGP 40M equivalents to
US$ 7.3M for the financial year ended December 31, 2009. Financing 2007. The waiver is conditional to the successful completion
of a forthcoming capital increase of OTH.
Intouch tax claims Egyptian mobile telephone operator “Egyptian Company for
Mobile Services (ECMS)” issued 1.5 billion Egyptian pounds On February 4, 2010, Orascom Telecom Holding (OTH) has
Intouch group received a tax claim amounting to DZD 204 million ($273.3 million) in 5-year bonds with Fixed annual yield hits been awarded an extension to the management contract of
in addition to penalties and default interest amounting to DZD 51 12.25 % payable once every six months starting mid-January. Alfa with the Republic of Lebanon, for a period of 6 months
million (equivalent to US$ 3.5 million ,equivalent to EGP 19 million). The bonds, which (ECMS) will use to finance the expansion ending on July, 31, 2010. Under this contract, OTH receives
On January, 2009 the company paid 20% from total tax claim in of its network, Such bonds are divided into two tranches. The a monthly sum of US$ 2.5 million in addition to 8.5% of total
order to be able to appeal against that claim. The Tax Disclosure in first one values L.E 1.4 billion and allocated for private offering revenues. Out of these amounts, OTH is liable to cover all the
Mobizone Algeria Audited Financials for the period ended Dec. 31, and institutions while the other L.E 100 Million tranche will be operational expenses (OPEX) of the network and is entitled
2009 mentioned that the company was granted a tax exemption allocated for public offering. to keep the remainder as management fees. The Republic
amounting DZD205 Million and the remaining amount of DZD 51 of Lebanon is fully responsible for the CAPEX during the
million was recorded as Provision. On February 17 2010, Orascom Telecom Holding received contract period.
US$ 225 million from Weather Capital Special Purpose 1 S.A.
Letters of credit and guarantees as shareholders not bearing interest  loan, , Where Weather 37. Cash flow statements
The Group has provided guarantees and letters of credit in the Capital Special Purpose 1 S.A. has agreed that in the event
ordinary course of business of the Group’s activities. Guarantees the Rights Issue is successful, the Loan under this Agreement Starting from the third quarter ended September 30, 2009
include the following: will, automatically, be converted into new Shares (to be the company has reclassified the advances and loans made
issued in the form of GDRs by the Depositary) at the share to associates and third parties from the “financing activities”
subscription price. to the “investing activities” caption. The reclassification was
- Letters of guarantee provided by ECMS to National Telecom adopted in order to adhere to IAS7 par. 16 (e). Hence, the
Regulatory Authority. The Company’s share in such letters of Other events previous classification for the periods, March 2009 and June
guarantee is equal to L.E 54.1 million equivalents to US$ 9.8 2009 shall be reclassified accordingly.
million. On January 21 2010,Orascom Telecom Holding announce
- Letters of guarantee provided by Ring Egypt to suppliers’ .The that it has obtained Majority Senior Secured Lenders consent
Company’s share in letters of guarantee is L.E 65.45 million on the proposed permanent waiver related to the existence of
equivalents to US$ 11.8 million. a  material tax claim under its US$2.5 billion credit agreement.
The waiver obtained is specific to the Algerian tax claim
- Letter of Guarantee amounting to US$ 1 million, equivalent against Orascom Telecom Algeria in respect of years 2004 to
to EGP 6 million in favor of NTRA to guarantee MENA Cable
execution of its entire obligation related to constructing,
operating and renting sea cables networks and its infrastructure
for international communications.
- Letter of guarantee in a favor of Lebanon Ministry of
Telecommunication (ROL) to guarantee OTH in the payment
of any amount due by the selected Participant to ROL amount
with US$ 30 million, equivalent to EGP 165 million.
- Guarantee provided by Orascom Telecom Bangladesh in favor
of Ministry of Post & Telecommunication, the Chief Controller
of Exports and Imports and Power development board existed
of BDT 99 million equivalents to L.E 7.83million equivalent US$
1.42 million.
36- Subsequent events
Share transactions
The Extra-ordinary General Assembly dated December
27,2009, delegated the Board of Directors members to proceed
with all necessary legal procedures to increase the authorized
capital from EGP. 2.5 to EGP. 7.5 Billion. The proposed Rights
Issue is intended to further strengthen the financial position
and ensure OTH’s liquidity including financing needs for the
Group in the case where there is no immediate resolution of
the tax dispute in Algeria.
On January 13, 2010 in accordance with the Egyptian
Financial Supervisory Authority’s (“EFSA”) requirements,
OTH published a Public Subscription Notice in connection with
the proposed rights issue (the “Rights Issue”). The Company
currently issued up to 4,356,590,515 shares at the nominal
price of EGP. 1 per share, to raise a total of EGP. 4,356,590,515
or approximately US$800 million (without issuing fees). Based
on the above the issued and paid up share capital will reach
5,245,690.620EGP comprising 5,245,690,620 share.
80

Appendix A Appendix A
Non- Line of Non-
  Current Total Currency Nominal Maturity Securities   Current Total Currency Nominal Line of credit Maturity Securities
current credit current
  Millions of EGP Millions of contract currency       Millions of EGP Millions of contract currency    

Orascom Telecom Holding S.A.E.                 Egyptian Company for Mobile Services                

NATIONAL SOCIETE GENERALE BANK 47 - 47 USD 9 10 19-8-2010 Unsecured Misr/CIB/NBE (Syndicated loans) 169 396 565 EGP 558 878 30/04/2013 Unsecured

Credit Agricole Indo Suez Ban 63 - 63 USD 11 22 30-6-2010 Unsecured Misr/CIB/NSGB/HSBC (Syndicated loans) 23 533 556 EGP 541 1,121 14/08/2014 Unsecured

National Bank Of Abu Dhabi 54 - 54 USD 10 10 21-2-2010 Unsecured Misr/CIB/NSGB/HSBC (Syndicated loans) 66 1,027 1,093 EGP 1,073 1,073 26/02/2015 Unsecured
14/10/2009 (Under
NATIONAL SOCIETE GENERALE BANK 275 - 275 USD 50 50 18-2-2010 Unsecured Misr 1 - 1 EGP - 12 Unsecured
renewal)
Fortis Banque 15 - 15 EURO 2 20 14-6-2010 Unsecured BNP 27 - 27 EGP 42 59 30/4/2010 Unsecured

HSBC 80 - 80 USD 15 15 1/7/10 Unsecured BB 24 - 24 EGP 24 27 under renewal Unsecured

NSGB-Car Loan 2 9 11 EGP 11 15 2-2-2013 Unsecured H.S.B.C 12 - 12 EGP - 41 9/1/10 Unsecured

NSGB-Car Loan 1 4 5 EGP 5 6 8-3-2014 Unsecured CAE 76 - 76 EGP 83 88 31/3/2010 Unsecured

NSGB-Car Loan - 1 1 EGP 1 1 8/3/14 Unsecured NSGB 68 - 68 EGP 73 74 30/4/2010 Unsecured

A1 Term Loan Supplemnt 571 4,758 5,329 USD 987 987 17-4-2013 Secured Scotia 34 - 34 EGP 34 44 9/12/10 Unsecured

A2 Term Loan Supplemnt 297 2,473 2,770 USD 513 513 17-4-2013 Secured CIB 14 - 14 EGP 15 24 16/09/2010 Unsecured

Revolving Credit Supplemnt 7 5,509 5,516 USD 1,000 1,000 17-4-2013 Secured AUB 17 - 17 EGP 17 17 12 months revolving Unsecured

Audi Bank 207 - 207 USD 38 50 28/3/10 Unsecured   531 1,956 2,487          

Citi bank 53 - 53 USD 10 10 Within one Year Unsecured Orascom Telecom Bangladesh Limited                

Egyptian Gulf Bank 26 - 26 USD 5 5 31-5-2010 Unsecured Hermes Facility 86 322 408 USD 79 79 1/7/14 Secured

Pireaus 28 - 28 USD 5 5 Within one Year Unsecured USD Commercial Faciilty 174 472 646 USD 122 122 1/8/13 Secured

  1,726 12,754 14,480           DFI Facility 18 138 156 USD 30 30 15/6/14 Secured

Pakistan Mobile Communications Limited                 BDT A Facility 48 73 121 BDT 1,575 1,575 30/6/12 Secured

Citibank N.A - Islamabad - Pakistan 24 21 45 PKR 633 1,740 02/07/2011 Secured BDT B Facility 16 54 70 BDT 918 918 30/6/14 Secured
Royal Bank of Scotland (Formerly ABN AMRO Bank)- Standard Chartered Bank, London 27 82 109 USD 25 50 30/9/16 Secured
1 231 232 PKR 3,548 3,548 18/12/2012 Secured
Islamabad- Pakistan
Commercial Bank of Ceylon 8 - 8 BDT 100 100 20/3/10 Unsecured
Habib Bank Limited - Islamabad - Pakistan (2007) 1 196 197 PKR 3,000 3,000 18/12/2013 Secured
Royal Bank of Scotland, London - Citibank London Citibank, N.A. 49 - 49 BDT 620 620 1/2/10 Unsecured
38 55 93 USD 17 48 28/02/2012 Secured
- ECGD - ECA Standard Chartered Bank 24 - 24 BDT 290 290 9/1/10 Unsecured
Royal Bank of Scotland, London - Citibank London -
163 142 305 EUR 39 125 30/12/2011 Secured Standard Chartered Bank 16 - 16 BDT 200 200 24/1/10 Unsecured
COFACE Loan - ECA
Royal Bank of Scotland, London -AB Svensk ExportKredit - Standard Chartered Bank 23 - 23 BDT 290 290 27/1/10 Unsecured
61 29 90 EUR 12 46 29/03/2011 Secured
Sweeden - Hermes - ECA
Royal Bank of Scotland, London BRAC Bank Ltd. 32 - 32 BDT 400 570 28/3/10 Unsecured
20 19 39 EUR 5 10 15/12/2011 Secured
-The OPEC Fund for international Development  - ECA Eastern Bank Ltd. 22 - 22 BDT 280 292 25/6/10 Unsecured
Royal Bank of Scotland, London;  Citibank International
plc; Sumitomo Mitsui Banking Corporation Europe Limited 64 202 266 USD 51 70 28/02/2014 Secured Eastern Bank Ltd. 13 - 13 BDT 160 160 9/5/10 Unsecured
- ECGD - ECA Round II Eastern Bank Ltd. 8 - 8 BDT 100 200 31/5/10 Unsecured
Royal Bank of Scotland London;  Citibank International
plc; Sumitomo Mitsui Banking Corporation Europe Limited 116 267 383 EUR 51 85 31/12/2013 Secured The City Bank 19 - 19 BDT 240 240 3/5/10 Unsecured
- Coface - ECA Round II The City Bank 12 - 12 BDT 150 150 9/4/10 Unsecured
Royal Bank of Scotland, London;  Citibank International
plc; Sumitomo Mitsui Banking Corporation Europe Limited 140 246 386 EUR 50 110 3/16/12 Secured National BankLtd 8 - 8 BDT 102 200 30/10/10 Unsecured
- Hermes - ECA Round II
Standard Chartered Bank (Working Capital Syndication) 28 - 28 BDT 360 360 17/3/10 Unsecured
DEG - Germany 42 117 159 EUR 20 20 15/08/2013 Secured
National Bank Ltd (Working Capital Syndication) 8 - 8 BDT 100 100 17/3/10 Unsecured
FMO - Netherlands 42 117 159 EUR 20 20 15/08/2013 Secured
Pubali Bank Limted (Working Capital Syndication) 28 - 28 BDT 350 350 17/3/10 Unsecured
MCB Bank Limited (PKR 22.060  Billion) - Islamabad - Pakistan 98 1,439 1,537 PKR 22,060 22,060 04/01/2014 Secured
Standard Bank Limited (Working Capital Syndication) 8 - 8 BDT 100 100 17/3/10 Unsecured
SCB Bank Limited STFA (PKR 5.1 Billion) - Islamabad Pakistan 63 275 338 PKR 5,100 5,100 09/05/2013 Secured
Uttara Bank Ltd. (Working Capital Syndication) 12 - 12 BDT 150 150 17/3/10 Unsecured
Dubai Islamic Bank (Pakistan) Ltd Ijara Facility PKR 700 Million 1 45 46 PKR 700 700 09/05/2012 Secured
Dutch Bangla Bank Limited 20 - 20 BDT 250 250 23/3/10 Unsecured
PAK Kuwait Investment Company Limited - Karachi - Pakistan 21 - 21 PKR 300 300 08/07/2010 Secured
Dutch Bangla Bank Limited 24 - 24 BDT 300 530 30/3/10 Unsecured
HSBC Bank Middle East Limited- Islamabad - Pakistan 7 - 7 PKR 101 600 Within one year Secured
  731 1,141 1,872          
  902 3,401 4,303          
81

Appendix A Appendix B
Non-   Current Non-current Total   Nominal Maturity Securities
  Current Total Currency Nominal Line of credit Maturity Securities
current
  Millions of EGP Currency Millions    
  Millions of EGP Millions of contract currency    
Orascom Telecom Algeria S.P.A.                 Pakistan Mobile Communications Limited              
Hermes loan 2006 114 214 328 USD 62 86 15/11/12 Secured Royal Bank of Scotland
7 612 619 USD 112 13/11/2013 Unsecured
Coface Loan 2006 145 - 145 DZD 1,904 9,724 15/11/10 Secured and Deutsche Bank Securities Inc. (Euro Bond)
BNP Parisbas Overdraft 2009 2 - 2 DZD - 2,200 15/12/09 Secured Pak Oman Investment Company Limited - Karachi - Pakistan
38 176 214 PKR 3,257 31/05/2013 Secured
  261 214 475           (Trustee - Public Listed TFC)
Orascom Telecom Tunisie S.A.                 Allied Bank Limited - Islamabad - Pakistan (2007) 225 - 225 PKR 3,325 01/10/2010 Unsecured
International refinancing 132 129 261 Euro 100 100 March-2011 Secured
Allied Bank Limited - Karachi - Pakistan (2007) 7 254 261 PKR 3,905 28/10/2013 Unsecured
Local refinancing 99 97 196 TND 105 105 March-2011 Secured
  231 226 457                          
Moga Holding Limited                 Orascom Telecom Finance SCA              
CDC Mezzanine shareholder loan 161 - 161 EUR 18 18 15/8/2010 Secured
Senior Notes OTFSCA 128 4,072 4,200 USD 750 8/2/14 Unsecured
  161 - 161          
Med Cable Limited                 Orascom Telecom Oscar              
Export Credit Calyon 16 16 32 EUR 6 12 13/9/11 Guaranteed Indexed linked notes 12 1,383 1,395 USD 230 18/2/13 Secured
  16 16 32          
Total Bonds 417 6,497 6,914        
Intouch for Telecommunication Services                
NBAD 9 4 13 L.E 35 35 1/4/11 Secured
Barclays 10 - 10 L.E 35 35 1/10/10 Secured
Barclays 1 - 1 L.E 1 1 less than one year Unsecured
  20 4 24          
Telecel Globe Limited                
Banque de development des etats de l›afrique Central
4 24 28 XAF 2,305 2,500 30/06/2014 Guaranteed
2007
Commercial Bank Centrafrique 2008 3 2 5 XAF 398 750 30/06/2011 Secured
Commercial Bank Centrafrique 2007 1 3 4 XAF 327 500 31/07/2012 Guaranteed
Ecobank Centrafrique - Local Loans 6 29 35 XAF 2,929 3,000 8/10/14 Secured
Commercial Bank Centrafrique Overdraft 2009 1 - 1 XAF 72 250 12 months revolving Unsecured
IBB - Bank Overdrafts 14 - 14 USD 2 2 12 months revolving Unsecured
Nedbank Limited and Investec Bank Limited - 228 228 NAD 311 311 12 months revolving Secured
  29 286 315          
                 
Trans World Associates (Private) Limited                
Other - various banks 6 38 44 PKR 643 1,608 November 27, 2013 Secured
  6 38 44          
Ring for Distributions                
Loan from Arab African Bank - Egypt 2 - 2 EGP 2 3 17/12/10 Unsecured
  2 - 2          
                 
Total - liabilities to banks 4,616 20,036 24,652          
82

Appendix C – Scope of Consolidation Appendix C – Scope of Consolidation

Selected subsidiaries, joint ventures and associates Selected subsidiaries, joint ventures and associates  
  Country of domiciliation Shareholding (directly/indirectly) held by Orascom Telecom Holding   Country of domiciliation Shareholding (directly/indirectly) held by Orascom Telecom Holding
North Africa Algeria Orascom Telecom Algeria S.P.A. 96.81%  Middle East Qatar LDN Qatar 49.00%
  Algeria Orascom Telecom Service Algeria 96.81%   Saudi Arabia LinkDotNet Saudi Arabia 100.00%
  Algeria Data Base Management services Algeria 100.00%   Saudi Arabia MobiZone Saudi Arabia 100.00%
  Algeria Ring Algeria LLC 98.01% Central Africa Burundi U-Com Burundi S.A. 100.00%
  Algeria Caring Algeria 97.03%   Central Africa Telecel Centrafrique S.A. 100.00%
  Algeria MobiZone Algeria 100.00% Namibia Power-com Cell one 100.00%
  Algeria Algeria Win Call 100.00%   Sudan Sudan Call 70.00%
  Algeria Consortium Algerian Telecommunication S.P.A. 49.83% North America Canada Globablive Investment Holdings 47.60%
  Morocco Kenza Telecom Morocco 100.00%   Canada Globalive Canada Holdings 65.40%
  Tunisia Ring Tunisia 78.21%   Canada Globalive Wireless Management 65.40%
  Tunisia Ring Distribution Tunisia 77.43%   Canada Gloablive Wireless LP (GELP) 65.40%
  Tunisia Ring Retail Tunisia 76.65%   Canada Globalive Telecom Holdings 65.40%
  Tunisia R&D Tunisia 96.53%   Canada Orascom Telecom Holding (Canada) Limited 100.00%
  Tunisia Orascom Telecom Tunisie S.A. 50.00% Europe France Orascom Telecom Services Europe 100.00%
Asia Bangladesh Orascom Telecom Bangladesh Limited 100.00%   France Orascom Telecom Wireless Europe 100.00%
  Bangladesh Ring Bangladesh 98.98%   Italy MobiZone Italy 99.00%
  Bangladesh MobiZone Bangladesh 100.00%   Luxembourg M Link Sarl 100.00%
  North Korea CHEO Technology JV (DPKR) 75.00%   Luxembourg Orascom Luxrembourg Sarl 100.00%
  Pakistan Pakistan Mobile Communications Limited 100.00%   Luxembourg Orascom Luxembourg Finance SCA 100.00%
  Pakistan Business & Communications 100.00%   Luxembourg Orascom Telecom Sarl 100.00%
  Pakistan Link Direct International Limited 100.00%   Luxembourg Orascom Telecom Finance SCA 100.00%
  Pakistan Mobitalk Limited 100.00%   Luxembourg M Link Teleport 100.00%
  Pakistan MobiZone Pakistan (Pvt.) Limited 100.00%   Malta Sawyer Limited 100.00%
  Pakistan PMDL Limited 16.70%   Malta Orascom Telecom Eurasia Limited 100.00%
  Pakistan Trans World Assoicates (Private) Limited 51.00%   Malta Oratel International Inc plc 100.00%
  Pakistan Ring Pakistan 94.59%   Malta Moga Holding Limited 100.00%
  Pakistan Ring Pakistan Service 94.59%   Malta International Wireless Communications Pakistan Limited 100.00%
  Pakistan WOL Telecom Limited 100.00%   Malta TMGL 100.00%
  Pakistan Call Pack Pakistan 100.00%   Malta Telecel International Limited 100.00%
Middle East Dubai Gloabl Entity for Telecom Trade 100.00%   Malta Orascom Tunisia Holding 100.00%
  Dubai Global Entity for Telecom Trade -FZE 100.00%   Malta Carthage Consortium Limited 100.00%
  Dubai Ring Dubai 96.53%   Malta Orascom Iraq Holding 100.00%
  Dubai LinkDotNet Dubai 100.00%   Malta Orascom Telecom Iraq Corporation 100.00%
  Dubai MobiZone Dubai 100.00%   Malta Orascom Telecom Ventures Limited 100.00%
  Egypt Middle East and North Africa Submarine Cable System –Mena Cable 100.00%   Malta Telecel Globe Limited *94%
  Egypt Cortex Egypt 94.00%   Malta Orascom Telecom Holding (Malta) Canada Limited 100.00%
  Egypt Ring for Distributions 99.00%   Malta M Link Limited 100.00%
  Egypt Advanced Electronic Industries 96.53%   Malta Minimax Ventures 100.00%
  Egypt Caring Egypt 97.02%   Malta Financial Powers Plan Limited 100.00%
  Egypt Connect 50.49%   Malta Orascom Telecom ESOP Limited 100.00%
  Egypt MMMS 98.80%   Malta Orascom for International Investment Holding 99.90%
  Egypt Intouch for Telecommunication Services 100.00%   Malta Data Base Management services Limited 100.00%
  Egypt Link Egypt 99.96%   Malta Orascom Telecom CS 100.00%
  Egypt Into Net 55.78%   Malta Mcube 51.00%
  Egypt LINKdotNET 100.00%   Netherland Orascom Telecom Netherland 100.00%
  Egypt Arab Finance Securities 100.00%   Switzerland Telecel International S.A. Switzerland 100.00%
  Egypt Link Development 99.80%   United Kingdom Med Cable Limited 100.00%
  Egypt Link Online Egypt 100.00%   United Kingdom Orascom Telecom WiMax 100.00%
  Egypt Arpu for Telecommunication Services 100.00%   United Kingdom International Telecommunication Consortium Limited 50.00%
  Egypt Global Telecom 95.80% *see note (32)
  Egypt Egypt Call 99.98%
  Egypt Mobinil Services Egypt 35.86%
  Egypt Mobinil for Telecommunication S.A.E. 28.75%
  Egypt Egyptian Company for Mobile Services S.A.E. 34.67%
  Egypt Egyptian French Company for Finance Lease 4.91%
  Iraq Ring Iraq 96.53%
  Palestine Pal Call Palestine 99.90%