1Q 2012 RESULTS

ANALYST BRIEFING

30 May 2012

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Disclaimer

Performance Overview

Financial review

Operating highlights

Concluding remarks

3

Key Operating Indicators

Key Highlights 1Q 2012

Financial Performance

1Q12 vs1Q11

• Operating revenue increased by 11.0% YoY to RM2,383.8mn

• EBITDA grew by 7.1% YoY to RM782.6mn; Normalised EBITDA increased by 7.6% YoY to RM784.6mn

• PATAMI grew by 53.5% YoY to RM 250.6mn; Normalised PATAMI grew by 50.0% YoY to RM183.3mn

• Internet revenue grew 24.3% YoY to RM563.4mn

• Streamyx and UniFi customers cumulatively total 1.97mn, up 11.4% YoY

• UniFi takeup > 26% of premises passed, up from 7.8% in 1Q2011

4

Performance Overview

Financial review

Operating highlights

Concluding remarks

5

Note: EBITDA Margin is calculated as percentage of EBITDA against Revenue + Other Operating IncomeFor Normalised EBITDA and Normalised PATAMI refer Slides 7 & 8

•Excludes FX (Gain )/Loss

RMmnReported Comments

(1Q12 vs. 1Q11)1Q12 4Q11 % Change QoQ 1Q11 % Change YoY

Revenue 2,383.8 2,447.2 -2.6 2,148.2 +11.0 Positive growth by all key products

Other Operating Income

26.6 37.0 -28.1 21.3 +24.9 -

EBITDA 782.6 796.1 -1.7 730.9 +7.1 -

EBITDA margin 32.5% 32.0% +0.5pp 33.7% -1.2pp -

Normalised EBITDA 784.6 808.1 -2.9 729.0 +7.6 -

Normalised EBITDA Margin

32.6% 32.5% +0.1pp 33.6% -1.0pp -

Depn & Amort. 510.6 535.9 -4.7 500.0 +2.1Higher asset base and provision for asset write-off

Other Gains 1.4 5.5 -74.5 0.7 +100.0 -

Net Finance Cost* 41.6 50.6 -17.8 42.7 -2.6 Higher yield on placements

FX (Gain) / Loss (67.9) (14.4) +371.5 (38.4) +76.8Higher due to weakening of USD against RM

Profit Before Tax (PBT) 299.3 229.6 +30.4 227.3 +31.7 -

Normalised PBT 232.0 221.6 +4.7 186.2 +24.6 -

PATAMI 250.6 598.3 -58.1 163.3 +53.5 Higher unrealised forex gain on USD debts

Normalised PATAMI 183.3 240.1 -23.7 122.2 +50.0 -

Group Results 1Q2012

6

Normalised EBITDA

In RM mn 1Q12 4Q11 1Q11

Reported EBITDA 782.6 796.1 730.9

Non Operational

Loss on Sale of Assets - 0.3 0.4

FX (Gain)/Loss on International trade settlement 2.0 12.9 (2.3)

Impairment of AFS – Receivables - (1.2) -

Normalised EBITDA 784.6 808.1 729.0

Normalised EBITDA Margin 32.6% 32.5% 33.6%

Reported EBITDA Margin 32.5% 32.0% 33.7%

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

7

In RM mn 1Q12 4Q11 1Q11

Reported PBT 299.3 229.6 227.3

Non Operational

Loss on Sale of Assets - 0.3 0.4

FX (Gain)/Loss on International trade settlement 2.0 12.9 (2.3)

Other (Gain)/Losses** (1.4) (5.5) (0.7)

Unrealised FX (Gain)/Loss on Long Term loans (67.9) (14.5) (38.5)

Impairment of AFS – Receivables - (1.2) -

Normalised PBT 232.0 221.6 186.2

Reported Taxation and Zakat (40.7) 379.9 (52.6)

Reported Non-Controlling Interests (8.0) (11.2) (11.4)

Last Mile Tax Incentives for prior years - (350.2) -

Normalised PATAMI 183.3 240.1* 122.2

Reported PATAMI 250.6 598.3 163.3

Normalised PBT & PATAMI

8

* Included RM127.6mn of tax incentives for 2011**Comprise fair value (FV) changes of FVTPL (FV through P&L) investment and gain/loss on disposal for AFS (available for sale) investments.

23.0 21.2

17.1 18.2

21.219.3

11.910.2

5.07.5

5.0 6.1

4.5 3.9

1.7 2.2

1Q11 1Q12

Bad Debt

Marketing Expenses

Supplies & material

Maintenance Cost

Other operating cost

Manpower cost

Direct cost

Dep & Amortisation

Revenue = Operating Revenue + Other Operating Income

Cost % of Revenue1

Note: The classification of cost is as per financial reporting

(Please refer to Appendix for quarterly details & breakdown)

Continued improvement of cost/revenue ratio

1

9

RM mnRM mn

Total Cost / Revenue ( %)

RM1,938.6

89.4%

RM2,138.4

88.7%

% of Revenue

1Q2012 vs. 1Q2011

•Higher Direct cost due to higher international outpayment and content cost

•Higher Maintenance cost due to customer projects and new maintenance contracts at ITNT

•Higher Supplies & Materials due to higher customer acquisition cost with increased UniFi customers

57 53

2723

1722

0

20

40

60

80

100

120

1Q11 1Q12Access Core Network Support System*

143169

49

6017

58

0

50

100

150

200

250

300

350

1Q11 1Q12

Access Core Network Support System*

86116

22

37

36

0

50

100

150

200

1Q11 1Q12

Access Core Network Support System*

Group Capital Expenditure

** Gross capex to be shared with Government equallyNote: Government coinvestment treated as deferred income, to be amortisedprogressively to match against the depreciation of assets

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

Higher HSBB capex spend in line with expansion

10

Total Capex

HSBB Capex**

Note : BAU – Business As Usual

RM mn

209

108

9.7

BAU Capex

101

4.7

Capex / Revenue ( %)

189

98

4.1

287

12.0

7.95.0

30 Mar 12 31 Dec 11 30 Mar 12 31 Dec 11Return on Invested Capital 6.29% 5.80% Gross Debt to EBITDA 2.06 1.93

Return on Equity 9.64% 8.09% Net Debt/EBITDA 0.73 0.69

Return on Assets 4.90% 4.47% Gross Debt/ Equity 0.84 0.86

Current Ratio 1.75 1.62 Net Debt/ Equity 0.31 0.29

WACC 6.34% 6.33% Net Assets/Share (sen) 216.0 209.0

31 Mar 12

Group Cash Flow & Key Financial Ratios

31 Dec 11*

RM mn 1Q12 1Q11

Cash & cash equivalent at start 4,212.6 3,488.0

Cashflows from operating activities 242.8 455.9

Cashflows used-in investing activities (541.4) (412.2)

Capex 287.0 209.0

Cashflows from financing activities 147.8 23.5

Effect of exchange rate changes 1.9 0.1

Cash & cash equivalent at end 4,063.7 3,555.3

Free cash-flow (EBITDA – Capex) 495.6 521.9

Cumulative HSBB grant received from Government: RM2.26bn

Strong Balance Sheet to support futurebusiness requirements

1

Based on Normalised PATAMI2

1

11

31 Dec 11*31 Mar 12

* Restated due to adoption of MFRS

2

Based on Normalised EBIT1

Performance Overview

Financial review

Operating highlights

Concluding remarks

12

Voice43%

Data22%

Internet21%

Others14%

306

443359

1Q11 4Q11 1Q12

465546 514

1Q11 4Q11 1Q12

Voice40%

Data21%

Internet24%

Others15%

453541 563

1Q11 4Q11 1Q12

924 917 948

1Q11 4Q11 1Q12

Group Total Revenue by Product

13

Data

RM mn

RM mn RM mn

Voice

Others*

Internet1Q12

1Q11

RM mnRM mn

RM mn

RM2,384mn

RM2,148mn

+3.4%

+2.6%

+4.1%

+24.3%

-5.9%

+10.5%

Positive YoY growth for all products

-19.0%

+17.3%

*Others comprise other telco and non-telco services (i.e ICT-BPO, MMU tuition fees, customer projects)

159194 177

1Q11 4Q11 1Q12

591 639 655

440 474 463

258 266 267328

417 415

1Q11 4Q11 1Q12

Consumer SME Enterprise Government

Retail75%

Global9%

Wholesale9%

Others7%

YoY revenue growth in Retail and Global Lines of Business

182256

225

1Q11 4Q11 1Q12

190 201182

1Q11 4Q11 1Q12

Retail76%

Global9%

Wholesale8%

Others7%

Group Total Revenue by Line of Business

14

1Q12

1Q11

RM2,384mn

RM2,148mn

* Others comprise revenue from VADS (reclassified from retail), Property Development, TM R&D, TMIM, UTSB and MKL

Retail Wholesale

RM mn

RM mnRM mn

RM mn

1,796 1,8001,617

Global Others*

-9.5%

-4.2%

-8.8%

+11.3%

-12.1%

+23.6%

+0.2%

+11.3%

55,156 93,107 139,896 201,842 269,3098,385

15,91224,479

34,65946,436

1Q11 2Q11 3Q11 4Q11 1Q12

UniFi Residential UniFi Business

2,710 2,692 2,633 2,566 2,524

1,607 1,596 1,568 1,546 1,526

64 109 164 237 316

1Q11 2Q11 3Q11 4Q11 1Q12

Fixed Line Residential Fixed Line Business UniFi

1,417 1,425 1,393 1,374 1,356

291 296 314 312 302 64 109 164 237 316

1Q11 2Q11 3Q11 4Q11 1Q12

Streamyx Residential Streamyx Business UniFiNet adds (in thousand)

In thousand

In thousand

+11.4%

+2.7%

Physical Highlights

Broadband Customer Growth

Fixed Line Customer Growth

*Call Usage Only ** Streamyx Net ARPU *** Blended ARPU

Broadband continues to grow, ARPUs stable

1,772

4,381 ARPU (RM) 1Q11 1H11 YTD Sept 11 FY11 1Q12

Fixed Line (DEL)* 33 34 34 34 33

Streamyx Broadband** 77 77 78 78 79

UniFi*** 188 186 184 184 182

1,830

+58

4,397

1,871

+41

4,365 4,349

+52

1,923 1,974

+51

4,366

-0.3%

+0.4%

63,541

+33.5%

+79

Net adds (in thousand)

109,019

+45

+396.9%

164,375

+55+72

236,501315,745

UniFi

ARPU

15

Performance Overview

Financial review

Operating highlights

Concluding remarks

16

Key Takeaways

Financial Performance

Broadband Champion

17

• Operating revenue grew by 11.0% YoY• EBITDA grew by 7.1% YoY• PATAMI grew by 53.5% YoY• Internet & Multimedia revenue grew by 24.3% YoY

• Streamyx and UniFi customers cumulatively grew 11.4% YoY to 1.97mn

• 2mn total broadband customers to date

• UniFi takeup remains strong at ~30% with close to 365,000 customers activated to date

• 1.22mn premises passed over 81 exchange areas, on track to meet PPP obligation of 1.3mn premises passed

• Going outside of PPP areas - driven by demand

UniFi

Information Exchange

• Building on foundation – launched new data center in Hong Kong for ICT-BPO business

Appendices

1Q12 4Q11 1Q11 1Q2012 vs. 1Q2011

Operating Revenue (RM mil) 2,383.8 2,447.2 2,148.2 -

Other Operating Income(RM mil)

26.6 37.0 21.3 -

Direct Costs % 18.2 15.3 17.1 Higher international outpayment and contentcostRM mil. 438.9 379.8 370.2

Manpower % 19.3 19.6 21.2 Lower due to lower bonus provision and VSS costRM mil. 465.6 487.6 459.0

Supplies & Materials % 6.1 7.6 5.0 Higher due to higher customer acquisition cost with increased UniFi customersRM mil. 147.7 187.6 109.5

Bad & Doubtful Debts % 2.2 0.8 1.7 Higher due to impairment at TM Global for UN embargo against TIC Iran preventing recoveryRM mil. 53.2 20.2 35.8

Marketing Expenses % 3.9 5.3 4.5Lower due to lower A&P activities

RM mil. 94.4 132.5 96.7

Maintenance Cost % 7.5 7.6 5.0 Higher due to customer projects and new maintenance contracts at ITNTRM mil. 181.0 189.6 109.2

Other Operating Costs % 10.2 11.7 11.9Lower due to lower professional fees

RM mil. 247.0 290.8 258.2

Depreciation & Amortisation % 21.2 21.6 23.0 Lower due to revision of useful life of certain assetsRM mil. 510.6 535.9 500.0

Total (RM mil) 2,138.4 2,224.0 1,938.6 -

Total (%) 88.7 89.5 89.4 -

Cost % of Revenue

19

7,477.5

162.9

10,053.9

6,402.7

1,559.6

2,072.7

18.9

17,694.3

7,405.8

1,854.8

468.4

4,213.0

869.6

4,558.0

3,923.9

7.7

626.4

2,847.8

14,121.7

724.8

17,694.3

7,726.9

170.9

10,086.8

6,308.3

1,577.0

2,178.5

23.0

17,984.6

7,863.4

2,265.5

606.7

4,064.1

927.1

4,500.8

3,715.2

156.8

628.8

3,362.6

13,906.7

715.3

17,984.6

Shareholders’ Funds

Non-Controlling Interests

Deferred & Long Term Liabilities

Long Term Borrowings

Deferred Tax

Deferred Income

Derivative financial liabilities

Current Assets

Trade Receivables

Other Receivables

Cash & Bank Balances

Others

Current Liabilities

Trade and Other Payables

Short Term Borrowings

Others

Net Current Assets

Property Plant & Equipment

Other Non-Current Assets

RM MillionAs at 31 Mar 2012 As at 31 Dec 2011*

Group Balance Sheet

20

* Restated due to adoption of MFRS

769 752 758

270 293 318

448 536 558

138223 171

0

500

1000

1500

2000

1Q11 4Q11 1Q12

Others

Internet

Data

Voice

Consumer37%

SME27%

Enterprise16%

Government20%

Revenue by Business Unit

Consumer36%

SME26%

Enterprise15%

Government23%RM mn

+0.2%

1,617

1Q12

+11.3%

RETAIL

Revenue by Product

1Q11

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

RM mn

RM mn

RM1,800mn

RM1,617mn

21

1,796 1,800

55 54 50

149 155145

21 2319

0

50

100

150

200

250

1Q11 4Q11 1Q12

Others

Data

Voice

Others : Include internet

WHOLESALE

Note: Total revenue is after inter-co elimination. Revenue of product is before inter-co elimination 22

Revenue by Product

190 201182

RM mn

-9.5%

-4.2%

MC83%

ASP17%

MC84%

ASP16%

MC : Malaysian Carrier TierASP : Application Service ProviderNote: Pure TM Wholesale customer segment excludes

Fiberail and Fibrecomm

1Q12

1Q11

Revenue by Customer Segment

102126 143

5687

104

922

2

3

0

50

100

150

200

250

300

350

1Q11 4Q11 1Q12

Others

Data

IRU Sales (Data)

Voice

America14%

Europe & AFME15%

Oceania & North Asia

26%

South Asia34%

Others11%

America7%

Europe & AFME17%

Oceania & North Asia

26%

South Asia38%

Others12%

1Q12

1Q11

Others : Include internet

GLOBAL

Note: Total revenue is after inter-co elimination. Revenue of product is before inter-co elimination 23

Revenue by RegionRevenue by Product

182

225

256

RM mn

-12.1%

+23.6%

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

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