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Annual Integrated Report

2013

Inspiring Innovations

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Unless the Lord bui lds the house, they labour in vainwho bui l t i t . Unless the Lord guards the c ity, thewatchman stays awake in vain.

Psalm 127 NKJV

An Integrated Report tel ls the overal l story of the organisat ion. I t is a report to stakeholders on the

strategy, performance, and act iv i t ies of the organisat ion in a manner that a l lows stakeholders to

assess the abi l i ty of the organisat ion to create and sustain value over the short, medium, and

long-term. An effect ive Integrated Report ref lects an appreciat ion that the organisat ions abi l i ty to

create and sustain value is based on f inancia l , socia l , economic, and environmental systems and by

the qual i ty of i ts relat ionships with i ts stakeholders. The Integrated Report should be wri tten in

clear and understandable language in order for i t to be a useful resource for stakeholders.

Integrated Reporting Committee of South Africa (IRC SA)

Our Commitment to Integrated ReportingIn our f i rst Integrated Report , we acknowledged that we had started on

a journey. The f i rst step was to lay a foundat ion for integrated report ing.

This is our second Integrated Report and we trust you wi l l perceive the

improvements over last year : more informat ion; greater ins ights;

improved transparency.

Disclaimer - Forward-looking statementAn Integrated Report inc ludes certa in for ward- looking statements. These forward- looking statements arenecessar i ly about the future and therefore incorporate degrees of uncert a inty. Consequently future actual resultsand performance may differ from these statements.

The forward- looking statements are current as of the date of publ icat ion of the Integrated Report. The Companymakes no representat ion that the information wil l be publ ic ly up dated after the release of the Integrated Report.

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Inspiring InnovationsEconets innovations are inspiring and life changing; we believe that technology that does

not change and improve lives is irrelevant. Hence we continuously search for transformingtechnologies to facilitate social transformation in existing and new markets. With the most

extensive coverage in Zimbabwe, Econet commands market leadership, delivering value and

inspiring transformation across the country.

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Performance highlights

Revenue Composition

1 Earnings before interest, taxation, depreciation, impairment and amortisation

EBITDA for 2012 excludes once-off profit on disposal of investments.2 Profit after taxation

3 Average revenue per user per month

4 Capital expenditure

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The Group continues to grow shareholder value as illustrated by the metrics above. Through the authority of the

shareholders, the Group has made a number of prudent share buy-backs in an effort to retain value.

Over the period, the Group made significant efforts to grow shareholder value, which mainly included the following:

Securing long-term fundingIn the current financial year, the Group managed to secure substantial debt facilities, and continued to service ongoing

facilities. This has enabled the Group to continue in its infrastructure and resource development aimed at optimising

operations and remaining the network of choice in the country.

Investment in infrastructure and resourcesThe Group continues to invest in network infrastructure development aimed at increasing network coverage and improving

network quality. As at year end, the Groups total assets have surpassed the $1 billion mark. The Groups subscriber base

has also increased from 1.2 million in 2009 to 8 million subscribers. Investment in various systems that are aimed at

improving operational efficiencies and containing costs continues to be made.

The focus on customer experience through delivery of superior productsEcoCash, the Groups mobile money transfer and payment system continues to transform the lives of individuals across

the country. New functionalities have been added to the EcoCash system that are aimed at servicing the needs of our

customers. A wide range of solar products was also introduced in the year. The Group increased its mobile data coverage

in the year through setting up new base stations to enable users to access data facilities. We continue to leverage our

investment in fibre infrastructure to deliver exceptional quality and data speeds.

The acquisition of core investmentsThe Group acquired TN Bank Limited as a strategic investment after realising the need to accelerate the convergence of

mobile telephone and financial services in line with global trends. TN Bank Limited also holds the licence for EcoCash, a

key product in the Group.

Reducing investor uncertainty through the provision of value-relevant informationFollowing the publication of the Groups inaugural integrated annual report in 2012, the Group has continued in its efforts

to provide useful and valuable information to all stakeholders. To this end, this years annual integrated report has improved

in the quality of information provided, with a focus towards meeting the informational needs of key stakeholders. Throughdiligent adherence to the latest International Financial Reporting Standards and best practices in financial reporting, the

Group continued to provide improved disclosure of its activities in its annual reports, interim financial results publications,

as well as presentations to the market.

Th

eYearInPerspective

Shareholder value delivery report

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Share price movement from February 2009 to February 2013

Note:

The share price during the year has been adjusted for the 10 for 1 share split in February 2013.

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Summarised income statement ('000) 2013 2012 2011 2010

Revenue 694,844 611,116 493,491 362,776

EBITDA 305,344 290,894 242,746 179,285

Finance charges (28,600) (10,202) (8,061) (4,903)

Profit before tax 204,903 239,130 196,471 148,122

Taxation (64,965) (73,389) (55,502) (34,912)

Net Profit for the year 139,938 165,741 140,969 113,210

Summarised statement of financial position ('000)

Non-current assets 739,951 644,763 536,439 296,875

Current assets 275,158 167,664 101,073 95,794

Equity and reserves 492,883 382,793 290,477 165,486

Non-current liabilities 288,293 174,005 244,038 127,460

Current liabilities 233,933 255,629 102,997 99,723

Net debt 264,571 249,138 248,392 138,707

Capital expenditure (147,044) (216,010) (270,034) (160,148)

Performance per ordinary share (cents)

Basic earnings per share 9.0 10.0 8.3 6.6

Headline and diluted earnings per share 9.0 10.0 8.3 6.6

Net asset value per share 319 232 172 95

Profitability and returns (%)

EBITDA margin 44% 45% 49% 49%

Operating profit margin 20% 27% 29% 31%

Effective tax rate 32% 31% 28% 24%

Net profit margin 20% 27% 29% 31%

Notes:

1. 2012 EBITDA margin excludes once off profit on disposal of investments

Four-year trading view

Th

eYearInPerspective

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Our business

Our Vision

To provide world-class telecommunications to all the people of Zimbabwe.

Our Mission

To serve Zimbabwe by pioneering, developing and sustaining reliable, efficient and high-

quality telecommunications of uncompromising world-class standards and ethics.

Our Values

The values we hold in common are:

Pioneering

We are a company committed to finding the best way forward in the fast-moving and highly competitive technology

field.

To remain leader in the field, we shall relentlessly pursue innovative solutions and constantly grow our knowledge base,

with an uncompromising passion for excellence.

Professionalism

In everything we do, both within Econet and in the community, we always work in a customer and objective-oriented

manner with clearly defined goals, in terms of quality of service. In all our professional areas and at all levels we carry

out our duties skilfully and diligently.

Personal

Internally we always remember that we are a company made up of individuals. These people are the Company. Each

one is an intrinsically valuable member of the organisation irrespective of their gender, race or position. We will always

show concern for each other in an atmosphere that is open and stimulates personal development, job satisfaction and

a sense of responsibility. We believe in working in teams, in effective and confident co-operation, in environments

where honesty, praise, constructive criticism and fair reward have their place.

Who we are inside the Company reflects who we are externally. Our relationship with our customers enthuses with

warmth and a genuine desire to meet their needs. We reach out to customers in a holistic and organic way that makes

them true stakeholders and willing participants in Econet Wireless.

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CorporateandLeadership

Corporate profile

EWZL - Zimbabwe holding companyThis annual integrated report incorporates the results of allthe subsidiaries and associates of Econet Wireless Zimbabwe

Limited. Econet Wireless Zimbabwe Limited (EWZL) is the

holding company of businesses involved in various sectors

of the economy as detailed below. EWZL, which is listed

on the Zimbabwe Stock Exchange (ZSE), is Zimbabwes

leading technology company. It is one of the largest quoted

companies in terms of market capitalisation and directly and

indirectly employs in excess of 15 000 people.

Subsidiary CompaniesEconet Wireless (Private) LimitedEconet Wireless (Private) Limited is EWZLs cellular network

operator with a base of 8 000 000 subscribers.

EW Capital Holdings (Private) Limited

EW Capital Holdings (Private) Limited is EWZLs investment

vehicle through which the Group holds a variety of

investments carefully selected with the twin objectives of

growing earnings and preserving value for shareholders.

Transaction Payment Solutions (Private) Limited

The Company is a leading provider of financial transaction,

switching, point of sale and value-added services that

exploit the convergence of banking, information technology

and telecommunications. The Company provides local and

international financial institutions and telecommunications

operators access to cutting-edge technology to enhancecustomer service, in partnership with one of the worlds

leading manufacturers of smart card-based point-of-sale

systems.

TN Bank LimitedTN Bank Limited offers commercial banking services in the

major centres of Zimbabwe. It is planned to play a pivotal

role in the Group, especially concerning EcoCash, for which

the Bank holds the banking licence neccessary for money

transfer services.

Pentamed Investments (Private) Limited

EWZL through wholly-owned Pentamed Investments

(Private) Limited holds 63% of the ordinary shares of Mutare

Bottling Company (Private) Limited. It also holds 6% in the

form of convertible instruments.

Mutare Bottling Company (Private) Limited

Mutare Bottling Company operates the Coca-Cola franchise

in the Eastern Region of Zimbabwe.

Associate CompanyData Control and Systems (1996) (Private) Limited t/aLiquid Telecom Zimbabwe

Liquid is a registered internet access provider in Zimbabwe

and is a leading data, voice and Internet Protocol provider in

the country. The Company supplies wholesale and retail fibre-optic and satellite services throughout Zimbabwe.

Econet Wireless Zimbabwe

Limited (EWZL; listed on

Zimbabwe Stock Exchange)

Econet Wireless (Private)

Limited (EWPL; cellular

network operator)

EW Capital Holdings

(Private) Limited (EWCH;

group investment vehicle)

TN Bank Limited

(commercial bank)

Pentamed Investments

(Private) Limited

(holding company)

Mutare Bottling Company

(Private) Limited

(MBC; Coca-Cola franchise)

Data Control and Systems

(1996) (Private) Limited t/a

Liquid Telecom Zimbabwe

98.60%

84.30%

63%

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Chairmans statement to shareholders

DR J. MYERS - Chairman of the Board

IntroductionThrough pursuing inspiring innovations and continuedinvestment in human capital, systems and technology,Econet continues to maintain its market leadershipposition. The Company is changing lives and transformingthe communities for the better by providing products andservices that address the needs of people across thecountry in line with its vision to provide telecommunicationservices to all people in Zimbabwe. The countrys mobilepenetration rate improved from 15% in 2010 to almost100% for the period under review, largely as a result ofthe increase in Econet Wireless subscriber base. TheCompanys extensive network coverage has allowedaccess to telecommunication and other services topreviously marginalised communities resulting in atransformational impact on those communities. Econetmade significant strides in providing access to internetservices by making internet access ubiquitously availablethrough its extensive data-enabled network resulting in the

internet penetration rate increasing to about 35%.

Investment ReviewSince inception the business has invested over US$1billion in the Zimbabwean economy, making it one of thelargest investors in the country. Further investment wasmade in the year under review in network infrastructure toimprove coverage and bring more capacity, particulary fordata services. This investment resulted in an increase to8 million subscribers; a growth of 25% from the previousyear.

The investment in network infrastructure is complementedby an extensive distribution network which has made theCompanys products and services easily accessible to its

subscribers across the country. This distribution networkconsists of over 100 different locations where there iseither a company owned shop, an exclusive franchise ora dealer. This investment has had a profound effect onemployment as it has created an extensive network thatdeals directly and indirectly with the Companys productsand services.

The business identified an opportunity in the financialservices sector where most of the people in the countrydid not have access to bank accounts or a means to dofinancial transactions easily and responded by launching

EcoCash; which to date has been a highly successfulintervention with over 2.1 million customers. Internationally,there has been a trend towards convergance of mobiletelecommunications and financial services. The Companyacquired TN Bank Limited as it realises the strategic rolefinancial services will play in its future growth. Mobilemoney services in Zimbabwe require a banking licence andthis investment allows the Company to be firmly in controlof the future growth prospects of its financial services-related innovations.

The Company continues to research into areas in whichtechnology can be used to address needs that areunique to Zimbabwe and Africa. Its innovations in solardevices has brought power and phone charging solutions

to communities that previously were not addressed byconventional power solutions. Innovation is a core valueof the Company and it will continue to drive its investmentphilosophy.

Operations ReviewEcoCash subscribers increased by 62% from 1.3 millionto 2.1 million subscribers. The agency network thatsupports the EcoCash business witnessed a growthof 242% to close at over 3,000 agents thereby creatingfurther employment opportunities and improving thenational payments system. Under the EcoCash serviceoffering, new services were introduced which include: billpayments, bulk payments, merchant services, as well asbanking-related facilities. The provision of banking-relatedservices necessitated the integration of most of thebanks in Zimbabwe onto the EcoCash platform. Throughthis intergration new features such as the bank to walletfunctionality that allows banked customers to transfermoney from their bank account to their mobile wallet werelaunched. Further to this the EcoCash debit card whichfacilitates payments to retailers and other merchants was

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CorporateandLeadership

500 academically talented students on a full scholarshipbasis.

to be the Partner of Choice in allprogrammes aimed at responding to national healthcarecrisis, such as cholera and typhoid, aswell as building and maintaining capacity in the nationalhealthcare delivery system.

Licence RenewalThe Econet Wireless Zimbabwe operating licence wasissued, as a 15 year licence in July 1998, and was scheduledto expire on the 9th of July 2013. The original licence, as

is standard international practice, set out guidelines tobe followed for the renewal process. It also stipulated alicence renewal fee of $100 million.

I am pleased to advise that the operating licence has nowbeen formally renewed by government, on substantiallythe same terms and conditions as the previous period,save for the fact that the licence period was extended to20 years, and the renewal fee, was set at $137.5 million.

All operators will be required to pay the same licence feeon renewal of their licences.

OutlookEconet Wireless is inspired to change the world of itscustomers through relevant innovations that addresscustomer needs. Having made a significant investment innetwork capacity and coverage in the past few years theCompany will continue to focus on improving its customerservice platforms, distribution network, and furtherenhance its internet service delivery capabilities. Researchand innovation in services that address the needs infinancial services, farming, health and education sectorswill continue so that the Company remains on the cuttingedge of new and inspiring innovations.

AppreciationI would like to extend my appreciation to the outgoingChairman Mr. Tawanda Nyambirai, for the guidance andleadership during his tenure. His invaluable contribution overa period spanning years in the Companys history is greatly

appreciated. I extend my appreciation to our customers,shareholders, strategic partners, and regulatory authoritiesfor their unwavering support during the year under review.I would also like to thank management and staff fortheir commitment in creating value for all stakeholders. Iacknowledge the tremendous support that I received fromfellow Board members who provided insightful wisdomand direction which has propelled the Company to yetanother level of success.

DR J. MYERSCHAIRMAN OF THE BOARD

14 May 2013

introduced. These innovations introduce a greater level ofconvienence to our subscribers and makes the technologyrelevant for their day to day lives.

Another first by the Company was the introduction of theexciting Buddie Zone, a service that allows customersto receive exciting dynamic discounts for voice calls. Thisinnovative concept has allowed for network resources tobe more optimally utilised.

Broadband continues to gain popularity due to its highspeed, excellent quality and the most extensive coverageof any operator in Zimbabwe. Data subscribers increasedby 52% from 2.1 million to 3.2 million in the year under

review.

The Green Kiosk initiative continued in the year underreview. Under this initiative traders have the opportunityto merchandise airtime, accessories, lanterns and otherproducts. This is yet another example of how the Companyis transforming the lives of ordinary people by giving smalltraders an opportunity to retail the Companys productsand creating for them unique opportunities to better theirlives. At the same time this initiative allows the provision offree solar powered phone charging solutions to subscriberswho have limited or no access to grid power.

Financial PerformanceRevenue for the year ended 28 February 2013 was

US$694.8 million, an increase of 14% compared tothe previous year. Earnings Before Interest, Taxation,Depreciation and Amortisation (EBITDA) recorded amargin of 44%. Depreciation and amortisation increasedby 54% to US$71.6 million in line with growth of the assetbase. Finance charges increased due to finalisation of themulti-creditor facilities in the year under review.

Total assets surpassed the US$1,0 billion mark as ofreporting date, registering a growth of 25% from last year.The debt to equity ratio improved to 54%, from 65% as at28 February 2013. The Group increased its investment inTN Bank Limited from 45% (an associate as at half year) to98.6% (a subsidiary). This investment has been accountedfor as a subsidiary from the date control was assumed, on31 January 2013.

Shareholders approved a 10 (ten) to 1 (one) ordinary sharesplit at an Extraordinary General Meeting held on 28February 2013.

Corporate Social InvestmentThe Company has introduced a more sustainable wayof assisting the marginalised members of our society.The Company set up the Higher Life Foundation, whichconsists of the following Trusts:

orphaned children into History Makers with aleadership mindset for global impact. There are currentlyover 41 000 History Makers who are

benefiting through the Capernaum Trust.

Scholarship Fund which so far has supported over

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IntroductionThe exceptional track record that has been achieved so far

demonstrates that the fundamental pillars that are required

to build, develop and sustain a robust and profitable

business are in place. As the economic environment

continues to improve and disposable incomes increase,

new opportunities for growth will be created. The Group

is well positioned to take advantage of these opportunities.

Operations reviewContinued growth

Econet Wireless Zimbabwe registered 14% growth in

revenues in the year ended February 2013. This continuedgrowth was despite a subdued economic environment.

The focus of the business remained on growing sustainable

value for all stakeholders by developing products and

services that meet the needs of customers and ensuring

that the pricing of these products reflects a sustainable

value proposition; having regard to the high capital nature

investments required in the telecommunications industry.

Chief Executive Officers operations review

DOUGLAS MBOWENI- Chief Executive Officer

Exciting products and services

Notable developments in the business during the year

under review include the launch of exciting and innovative

products such as the Buddie Zone initiative which is

aimed at ensuring that we derive maximum benefit from

our investment in the network through enhancing the

customers appetite to make voice calls based on certain

dynamic criteria. Other exciting products and services

developments are outlined below.

Mobile Money Transfers

EcoCash, the Mobile Money Transfer (MMT) System,

launched several exciting features that were an

unprecedented success. The continued roll out of point-

of-sale machines and the interface between point-of-sale

terminals and the mobile wallet brings with it unparalleled

convenience for our customers. In addition, the continued

integration with all major banking institutions of the

EcoCash platform as well as the extensive agent network

makes EcoCash the most integrated, widely accessible and

most convenient financial transaction service in Zimbabwe

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products and services. We believe that this continued

investment demonstrates our commitment to ensuring

that our customers get the best quality of service.

Brand quality

Our brand surveys continued to show that our brand is

highly visible, well recognised, respected and appreciated.

Our brand is founded on strong principles that embody a

pioneering approach to business, which means we will

always relentlessly pursue new ways of doing things

in a very fast moving field. We continue to defend and

protect our leading market share position and revenue

growth through new innovations, aggressive promotions

that create a heightened brand awareness and a positive

disposition towards the Econet brand.

Going ForwardOur focus continues to be on providing world-class

services that are relevant to our customers. We aim to

provide a platform for continued economic growth whilst

transforming our communities in a way that goes beyond

the normal corporate social responsibility practices. The

licence renewal has provided a new lease of life for usto plan and execute our strategic priorities. We welcome

the future with confidence that we are poised for some

exciting opportunities as the economy continues on its

current path to recovery.

D. MBOWENI

CHIEF EXECUTIVE OFFICER

14 May 2013

today. The acquisition of TN Bank Limited is another

exciting development which will propel the success of

EcoCash. EcoCash has been cited as the second fastest

growing MMT service after the world renowned M-PESA

system that operates in Kenya. The fact that this feat

has been achieved in just under 18 months of operation

is a significant achievement. Our vision is to continue to

innovate and provide Mobile Phone-based Applications.

Roaming services

Continued rollout of post-paid, data and prepaid roaming

with international partners remained a key priority.

Campaigns to increase customer awareness of roaming as

a mass-market offering continued.

Data services

Our data service continues on an exceptional growth curve.

Our investment in fibre technology and our superior data

coverage has resulted in a growth rate of over 50% in our

data subscribers. Our data speeds are amongst the fastest

in Africa and our coverage is superior to our competitors.

Network quality and customer service

The network is truly a world-class network which has a

quality and performance that we constantly benchmark

with other leading operators in the region and on a global

scale. Our network performance has been well above

international benchmark performance and our continued

focus in this area will result in a network that is far superior

to many other operators. To complement the network

quality and performance initiatives, significant investment

has been made to upgrade call centre facilities and capacity

as well as the retail and customer services footprint. This

has enhanced our customer points of presence as well

as our responsiveness to customer enquiries about our

CorporateandLeadership

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Board of Directors

Dr James MyersChairman of the Board ofDirectors (W.E.F 12-12-2012)

Mr Strive MasiyiwaExecutive director

Mr Craig FitzgeraldNon-executive director

Mr Douglas MboweniExecutive director -Chief Executive Officer

Mrs Sherree ShereniIndependent non-executive(Appointed 15-05-2013)

Mrs Tracy MpofuNon-executive director

Mr Kris ChirairoExecutive director -Finance director

Ms Beatrice MtetwaNon-executive director

Mr Godfrey GomweIndependent non-executive

(Appointed 15-05-2013)

Mr Martin EdgeIndependent non-executive

(Appointed 06-06-2013)

Mr John PattisonRetired (31-08-2012)

Mr Tawanda NyambiraiRetired (12-12-2012)

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Mr Godfrey Gomwe

Godfrey is Chief Executive of Anglo Americans globalThermal Coal business. Until 31 August 2012, he was

Executive Director, Anglo American South Africa Limited.

He was previously Head of Group Business Development,

Africa for Anglo American Plc and prior to that, Finance

Director and Chief Operating Officer of Anglo American

South Africa. He is Chairman of Tshikululu Social

Investments and a former non-executive director of Kumba

Iron Ore Ltd and Anglo Platinum Ltd. Before moving to

South Africa in 2003, he was Chairman and CEO of Anglo

American Zimbabwe. He is a past President of the Institute

of Chartered Accountants of Zimbabwe and past Senior

Vice President of the Chamber of Mines of Zimbabwe. Hehas held many Directorships in both listed and unlisted

companies.

He is currently on the board of Thebe Investment

Corporation (Pty) Ltd where he is Chairman of Thebe

Mining Resources Limited, Chairman of the Remuneration

Committee as well as a member of the Investment

Committee. He currently serves on the Executive Council

of the Chamber of Mines of South Africa. Godfrey has a

Bachelor of Accountancy degree from the University of

Zimbabwe, is a Chartered Accountant (Zimbabwe), and

holds a Masters degree in Business Leadership from theUniversity of South Africa.

Mr Martin Edge

Martin Edge brings the experience gained from a financialcareer focused on both Africa and the telecommunications

sector. Until mid-2012 he was a Managing Director with

Standard Chartered Bank in Johannesburg.

Martin has practised as a corporate finance advisor

since 1985, working for nine years at Hambros Bank in

London, four years as head of TMT Advisory at HSBC

in Johannesburg and 7 years as Director and Head of

Corporate Finance at First Africa, which was acquired by

Standard Chartered in 2009. In between, he spent three

years working at CCAfrica (& Beyond), a leading African

luxury tourism group, as its Finance Director and CorporateFinance Director.

Martin has advised on some of the largest corporate

finance transactions in Africa for clients such as Econet,

Anglogold, MTN, Vodacom, Bharti Airtel and McDonalds.

He has served on many private company Boards in Africa

and is a Trustee of two trusts within the Macmillan Africa

group.

Martin graduated with an honours degree in Philosophy,

Politics and Economics from the University of Oxford, and

is a UK Chartered Accountant. He has lived in South Africasince 1995.

Mr John Pattison (retired 31-08-12)

Mr Tawanda Nyambirai (retired 12-12-12)

BOARD OF DIRECTORS (continued)

Notes

Audit Committee

C. Fitzgerald*

K. V. Chirairo

D. Mboweni

T. P. Mpofu (Mrs)

P. J. Campbell

M. Harris (Mrs)

Investments Committee

C. Fitzgerald*

K. V. Chirairo

D. Mboweni

T. P. Mpofu (Mrs)

Dr J. Myers

B. Mtetwa (Ms)

P. J. Campbell

M. Harris (Mrs)

Loans Committee

C. Fitzgerald*

K. V. Chirairo

D. Mboweni

T. P. Mpofu (Mrs)

P. J. Campbell

M. Harris (Mrs)

Related Party Committee

P. J. Campbell*

Dr J. Myers

B. Mtetwa (Ms)

*Chairman

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The Directors have pleasure in presenting their report for

the year ended 28 February 2013. In the report Group

refers to Econet Wireless Zimbabwe Limited and its

subsidiary companies.

Principal Activities and Operations Review

The Groups core business continued to be the provision

of cellular services, provision of internet access services,

transaction processing services and mobile banking

services. Econet continued to consolidate its position

as the market leader in the telecoms industry, including

EcoCash mobile banking services. A detailed review of

the Groups operations, results and principal activities

during the year and the likely future activities are given in

the Chairmans Report and the Chief Executive Officers

Operations Review.

New Developments

The Group acquired control of TN Bank Limited towards the

end of the year. This acquisition is expected to strengthen

Group activities, particularly its EcoCash mobile money

service and increase its penetration of rural markets. The

full effects of this acquisition will be felt through the Group

in the coming years.

Several new products were launched during the year,

particularly under the Buddie banner.

Human Capital

The Directors are pleased to report that the Groups staff

continued to demonstrate commitment and dedication in

all aspects of the business. As a result, the Group has beenable to continue achieving the high levels of performance

and market leadership it enjoys.

From the Directors

Various initiatives, which are elaborated on in the Human

Capital Report, were embarked on during the year, aimed

at achieving continuous improvement in the Groups

performance. The Directors are confident that these

initiatives will bring about the intended benefits.

Consolidated Results

The Groups financial results during the year are fully

covered in the Chairmans Report.

Dividends

In order to allow the business to focus on achieving the

targets of the various initiatives it has embarked on, the

Board considered it prudent not to declare a dividend for

the year.

Share Capital

Due to new developments in terms of investment

expectations, in particular the wish to reach more

investors, the Board recommended the sub-division of the

Groups shares at the rate of ten (10) shares for every one

(1) existing share.

At an Extraordinary General Meeting held on 28 February

2013 shareholders approved the share sub-division.

The special resolutions implementing the sub-division

and amending the relevant provisions in the Companys

Memorandum and Articles of Association, were adopted.

The notes to the annual financial statements provide

further details on the share capital of the Company.

The new shares were listed on the Zimbabwe StockExchange on 1 March 2013.

CorporateandLeadership

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Share Buy-back

The cost of shares bought back during the year was

US$31.9 million (2012: US$28.4 million). Total treasuryshares on hand as at 28 February 2013 were 75 981 050

(2012: 105 444 310).

During the year the Company cancelled 82 574 590 shares

which represents approximately 5% of the issued share

capital as part of its strategy to return value to shareholders.

It is the intention of the Company to cancel the shares on

hand at an appropriate time.

Directors

In accordance with Article 81 of the Companys Articles of

Association, at least one third of the directors must retire

and seek re-election at each annual general meeting. The

following directors retire by rotation and, being eligible,

offer themselves for re-election: Mr Craig Fitzgerald, Ms

Beatrice Mtetwa and Mr Kris Chirairo.

Mr Tawanda Nyambirai retired from the Board on 12

December 2012 and Dr James Myers succeeded him as

chairman on the same date.

Mr John Pattison, executive director for Customer

Services, retired from the Companys employ with effect

from 31 August 2012.

In terms of section 89.2 of the Articles of Association, the

following directors, who were appointed after the reporting

date, are to be confirmed as independent non-executive

directors: Mr Godfrey Gomwe, Mrs Sherree Shereni and

Mr Martin Edge.

At the Annual General Meeting shareholders will be

asked to approve payment of the directors fees, the re-

appointment of the retiring directors and the confirmationof newly appointed directors.

Directors Interests

The beneficial interests of the directors in the shares of

the Company are shown on note 26.6 of the financial

statements.

Register of Members

The register of members of the Company is open for

inspection to members and the public, during business

hours, at the offices of the Companys transfer secretaries,

First Transfer Secretaries (Private) Limited.

Borrowing Powers

The details of the Groups borrowing powers are set out in

Note 40 of the financial statements.

Capital commitments

Details of the Groups capital commitments are set out in

Note 41 of the financial statements.

Pension Fund

The Groups pension fund scheme is administered by a

Board of Trustees. The Trustees manage the assets of

the pension fund, which are held separately from those

of the Group. The assets and funds of the scheme are

administered in accordance with the rules of the pension

fund.

FROM THE DIRECTORS (continued)

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An audit of the fund had established that the fund was

significantly undercapitalised. An exercise is currently

underway to find the best means of recapitalising the fund.

Corporate Social Investment

Contributing to the countrys economic and social

development remains a key component of the Groups

culture. Through various initiatives and activities the

Group fulfilled this commitment during the year. Further

discussion on the Groups activities can be found in the

section on Community and Trusts.

Donations to Political Parties

The Group does not, as a matter of policy, contribute to any

political party.

Auditors

Ernst & Young Chartered Accountants (Zimbabwe)

continued in office as the Groups auditors during the

year. At the annual general meeting, shareholders will be

requested to approve the remuneration of the auditors for

the year ended 28 February 2013.

Going concern

The Directors have satisfied themselves that the Group

is a going concern as it has adequate financial resources

to continue in operational existence for the foreseeable

future.

The Groups Annual Report and other corporate publications

are available on the corporate website www.econet.co.zw.

By order of the Board

Dr J. Myers

CHAIRMAN

D. Mboweni

CHIEF EXECUTIVE OFFICER

C. A. Banda

GROUP COMPANY SECRETARY

14 MAY 2013

CorporateandLeadership

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The Board of Directors and BoardCommittees

Composition and appointmentFollowing the retirements of Messrs John Pattison and

Tawanda Nyambirai on 31 August 2012 and 12 December

2012 respectively, the Board comprised seven directors

made up of three executive and four non-executive

directors. A non-executive director chairs the Board. The

offices of the Chairman and Chief Executive Officer are

separate.

To strengthen the independence of the Board of Directors,

three new independent non-executive directors are being

appointed: Anglo Thermal Coal CE Godfrey Gomwe, Coca-

Cola Africa Foundation Programme Director Sheree Gladys

Shereni and Martin Edge, former Managing Director of

Standard Chartered Bank.

The non-executive directors are drawn from a wide range

of fields, bringing broadly-based business knowledge and

experience to the deliberations of the Board. The election

to the Board of non-executive directors is subject to

confirmation by shareholders.

In terms of the Companys Articles of Association and

the Companies Act (Chap 24:03) at least one third of the

directors must retire at every annual general meeting and,

if eligible, can stand for re-election. At the last annual

general meeting, held on 27 July 2012, the following

directors were re-elected: Mr Tawanda Nyambirai who

subsequently retired on 12 December 2012, Mr John

Pattison who subsequently retired on 31 August 2012, and

Dr James Myers.

Accountability and delegated functions

The Board has the ultimate responsibility of upholdingand promoting the Groups strategic and sustainable

development. To achieve these goals the Board focuses

on the following key areas:

- reviewing and approving the Groups overall strategy

- reviewing and approving the Groups capital expenditure

- reviewing and approving the Groups major

investments and acquisitions and safeguarding the

Groups assets

- monitoring and ensuring observance of good

governance in the Group

Governance Statement

- reviewing financial, operational and compliance

controls

- reviewing and monitoring risk management procedures

and assessing their effectiveness

- reviewing and approving the Groups budget and

maintaining proper accounting records

- reviewing and approving annual financial statements

and all notices to shareholders and stakeholders.

The Board is ultimately accountable to shareholders for the

performance of the business. Directors are responsible for

the preparation of financial statements for each financial

period which give a true and fair view of the state of affairs

of the Group as at the end of the financial period.

To achieve this, the directors ensure the maintenance of

adequate internal controls and procedures for financial

reporting on the Group and that financial managers conduct

themselves with integrity and honesty and in accordance

with ethical standards of their profession.

The Board is also ultimately responsible for communicating

with the investor community. This communication is done

through the Chief Executive Officer, the Financial Director

and the Chairman, who organise regular briefing meetingswith analysts, institutional investors and the media. The

outcome of the meetings is communicated to the Board

from which it learns of shareholders and investors

opinions and perceptions of the Group.

Access to Executives

All directors have full and unfettered access to management

and the Group Company Secretary for information required

to discharge their responsibilities fully and effectively.

Whenever they deem it necessary the directors are

entitled, at the Groups expense, to engage independent

advisors for expert or independent professional advice inthe furtherance of their duties.

Directors interests

In compliance with good corporate governance, directors

are required each year to declare in writing whether they

have any material interest in any contract of significance

with the Group or any of its subsidiaries, which could give

rise to a related conflict of interests. Directors are also

required to disclose their other business interests. None

of the directors had a material interest in any contract of

significance to which the Group was a party during the

year, other than their service contracts.

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Governance

Board CommitteesThe Board retained its three committees to assist it in

discharging its duties and responsibilities. The Audit

Committee has a sub-committee, the Related Party sub-

committee. The committees and the role they play are

fundamental to good corporate governance in the Group.

The committees operate within defined terms of reference

set by the Board. Regular reports of committee business

and activities are given to the Board and minutes are

circulated to all directors. The Board committees share

with the main Board the authority to take independent

professional advice at the Groups expense when deemed

necessary to do so. The committees are chaired by non-

executive directors. They submit reports to the main Board

on the committees deliberations and findings.

Audit Committee

The Committees main responsibilities include the

reviewing of the Groups internal controls and internal

audit functions. It reviews the plans, principles, policies

and practices adopted in the preparation of the Groups

financial information. It also reviews, in conjunction with

management, procedures relating to financial and capital

expenditure controls.

Together with external auditors the Committee reviews

the scope and results of the audit. The Committee also

takes note of new legislation and new internationalreporting standards and ensures that these are adopted

by the business.

The Committee oversees the Groups risk management

policies and procedures and ensures these are fully

implemented and observed. The Board, through the

Committee, has since established a process of identifying,

evaluating and managing the significant risks faced by the

Group. The Committee meets regularly with the Groups

external and internal auditors and executive management

to consider risk assessment.

The Audit Committee has a sub-committee in the form of

the Related Party Sub-Committee.

The external auditors and the Chief Risk Officer have

unrestricted access to the committee and its chairman and

attend audit committee meetings.

Investments Committee

The Investments Committees main responsibility is to

review the Groups existing and proposed investments

and advise the Board on the viability or otherwise of the

investments. It provides the Board with reports on the

performance or potential performance of the investmentsso that the Board can take informed decisions on those

investments.

Loans Committee

The Loans Committees role remained the same and that

is to review the Groups major loans obligations, both local

and foreign, and put forward recommendations on the

servicing of these obligations. The Committee appraises

the Board of the Groups performance in terms of meeting

its loan obligations and compliance with the covenants

attaching to those obligations.

Related Party Transactions Sub-Committee

The Related Party Transactions Sub-Committee is a

sub-committee of the Audit Committee. Its function is

to review all transactions between the Company and its

related parties. The sub-committee reports to the Audit

Committee.

Investor Relations

The Group continues to recognise the importance of

communicating with the various stakeholders. To this

end the Group holds analyst briefings at which investors

and analysts are briefed on the Groups performance up

to the end of that period. The communication offers the

Group the opportunity to receive valuable feedback on its

performance and general perception of it by the investor

community.

Two meetings are held with investment analysts each

year, one after the release of the Groups half-year results

and the other after the release of the full year results, at

which a full briefing of the Groups performance is given.

Employment and equity practices

The Group has in place policies and procedures to achieve

good behaviour and conduct among its employees. In

line with best practice the Group has adopted as part of

its culture observance by its directors and employees of

the highest standards of ethical behaviour. Directors and

employees are expected to conduct themselves with

integrity and professionalism, with a view to achieving

excellence in customer satisfaction, quality of products

and services, and generally maintain the good name of thebusiness. A whistle-blowing programme is also in place

to encourage employees to report any concerns, including

any suspicion of violation of the Groups financial reporting

or environmental procedures.

The Group is committed to equality of opportunity. Career

development and promotion of disabled people is, as

far as possible, the same as that of other employees.

All employees are accountable for adherence to equal

opportunity and anti-discrimination policies.

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The Group recognises the need to continuously develop

skills and, accordingly, efforts towards providing employees

with opportunities for growth and development are

promoted, and in the process achieve team effectiveness.

Human capital development remains part of the Groups

growth strategy.

The Group also recognises its obligation to comply with

health and safety legislation and through training and

communication, encourages employees to create and

secure a safe and healthy working environment

Environmental Awareness

Sending of e-waste back to suppliers is an initiative being

pursued but authority to return imported equipment has

still not been received from the relevant authorities.

Directors and Employees dealings in shares

The Group complies with the Zimbabwe Stock Exchange

listing rules in relation to transactions by directors and

employees in securities issued by the Group. Directors

and employees or their nominees or members of their

immediate family are prohibited from dealing, either

directly or indirectly, in the Groups securities at any

time when they are in possession of unpublished, price-

sensitive information regarding the Companys business or

activities.

The Group operates a closed period prior to the publication

of its interim and annual results. No director or employee

of the Company may deal in the securities of the Company

during the closed period. In terms of policy, directors and

employees who wish to transact in the shares of the Group,

even outside of the Groups closed or blocked period,

are required to obtain the clearance of the Chairman.

Independence of Auditors

The Groups Audit Committee confirms the independence

of the Auditors, Ernst & Young Chartered Accountants

(Zimbabwe), who are engaged by the Group for audit-

related services. Ernst & Young Chartered Accountants

(Zimbabwe) have indicated their willingness to continue in

office as auditors of the Group. A resolution to re-appoint

them as auditors for the ensuing year will be proposed at

the 2013 Annual General Meeting, members can either

appoint them for the ensuring year or pass a resolution to

appoint another firm of auditors. Whenever necessary the

Group calls upon the services of other firms to assist with

non-audit management consultancy work.

By order of the Board

Dr J. Myers

CHAIRMAN OF THE BOARD

D. Mboweni

CHIEF EXECUTIVE OFFICER

K.V. Chirairo

FINANCE DIRECTOR

14 MAY 2013

GOVERNANCE STATEMENT (continued)

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Enterprise Risk Management (ERM)The risk management division within Econet Wireless

Zimbabwe Limited (EWZL) is headed by the Chief Risk

Officer who reports directly to the Audit Committee

Chairman and administratively to the CEO. The risk

management process is integrated within the day-to-day

activities of Econet Wireless Zimbabwe Limited (EWZL).

The Group has developed a system of risk management

and internal control that delivers:

documented risk communication strategies.

profile.

The risk division structure comprises of four independent

and objective units: Internal Audit, Revenue Assurance and

Fraud Management, Corporate Risk, Safety Health and

Environment.

The risk division system involves regular reporting of risks

to the Board which assists the Board in fulfilling its risk

management responsibilities.

Commitment by Management

Management demonstrates its commitment to the

process by investing in the necessary technology, human

resources and processes. A competitive human resources

complement makes up the Risk team. These skills and

technologies are augmented by robust processes which are

well documented and tailored to align with organisationalprocesses.

Risk communication

Interactions with various governance groups occurred

as planned during the year. Within these interactions

risk issues are discussed as part of the agenda. The risk

division meets regularly with functional divisions on a

monthly basis to discuss emerging risk issues and to make

follow-ups on previously identified risk issues. The division

attends and submits a Quarterly Risk Report to the Audit

Committee of all its activities for information as well as to

guide the Committee in decision making.

Risk report

Risk mitigation activities

Internal Audit

The Group has an internal audit department which monitors

and reports on internal control systems. The internal audit

department adopts a risk-based audit approach guided by

extensive risk assessment of business issues, particularly

those issues identified by the Audit Committee and senior

management.

Whenever necessary, the Group calls upon the services

of independent expert firms to assist with non-audit

management consultancy work. These outsourcing

arrangements add to the objectivity and independence of

the internal audit work undertaken.

Internal control and risk management

During the year, internal audit efforts were focused on:

performance.

The planned audit assurance plan for the year was ninety

percent (90%) fulfilled. The internal audit function has

implemented an audit grading system which is used to

gauge the performance of individual auditable units or

areas against expectations and compares performance to

previous audits.

Focus will continue to be on the improvement of the

quality and maturity of internal audit coverage through

a combination of increasing allocation of resources

within the internal audit department in addition to the

continued outsourcing arrangements for some internal

audit assignments. This will be measured in terms of the

total number of man hours that the audit team will spend

in the auditing activity for the various functions as well

as measuring against target deliverables for outsourced

arrangements.

In 2013-14, the internal audit department intends to focus

primarily on the following inherent fraud risk categoriesfrom both a fraud risk and an internal audit perspective:

Mobile Money, Procurement, Inventory, Treasury,

Customer Services and Network Services

Peopleand

community

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On a quarterly basis the risk appetite of the business is

reviewed and risk efforts are revised where appropriate, in

line with changing priorities.

Revenue Assurance

The New Product and Value Added Services (VAS)

Assurance function carry out all new product and existing

product assessment activities. This ensures that all new

product risks are addressed before launch and that existing

products are continuously monitored.

The Service Risk function minimises revenue leakage

through reviewing the switch to billing and charging

processes in order to facilitate complete and accurate

billing of all call events on the network. Partner andproduct management activities ensure revenue collection

is maximised.

The Network Fraud Section ensures fraudulent activities

are timeously detected and investigated. Adequate

preventive measures are proactively implemented to plug

any fraud leakages.

Corporate Risk

The business has a Corporate Risk department whose

function is to implement an Enterprise Risk Management

programme within the business.

In 2013-14, the Corporate Risk department intends to

focus primarily on the following areas:

the business

Management Systems ImplementationWe are continuously improving our environmental

and social performance in an effort to attain excellentstandards, particularly in the following areas:

- Risk assessment system reviews and improvements.

- Independent consultants are engaged to perform

environmental and social impact assessments (EIAs)

on all sensitive sites for new projects.

- New GSM sites are outsourced to reputable companies

with adequate technical capabilities, environmental and

social management standards

- Coastal and Environmental Services of South Africa

has been appointed (through deutsche investitions-

und Entwicklunggesellschaft mbH, Kln (DEG)) to

assist Econet Wireless in the review, development

and implementation of an Environmental and Social

Management system based on International Finance

Corporation ( IFC) performance standards.

Occupational Safety and Health (OHS)Econet Wireless has a SHE policy which clearly defines our

commitment to providing a safe and healthy work place for

all staff members. The following strategic interventions are

being consistently implemented to ensure best practicesand legal compliance:

clothing and equipment

delegated responsibility for the implementation of

recommendations.

through competent authorities.

emergency care in case of accidents.

with statutory requirements.

effective knowledge, skills and attitudes necessary for

implementation of programmes.

assessments to ensure work and health compatibility.

the impact of HIV/AIDS through the company-funded

Live to Love programme

Environmental HealthEconet Wireless has defined its Resources Efficiency and

Pollution Prevention commitment designed to minimise

and reduce the level of waste, to improve pollution

prevention, and to enhance resource conservation. These

strategic initiatives included the following:

RISK REPORT(continued)

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Peopleand

community

Resource Efficiency Programmes:

Challenge:Currently Zimbabwe has electricity challenges

forcing the use of stand-by generators to minimise network

down time. This has resulted in the increased use of diesel

and therefore carbon emission concerns.

Response: Econet Wireless is investing in solar power

solutions in order to supplement generator power in

selected rural towers. In urban centres green hybrid

power solutions with deep cycle batteries, have been

implemented to reduce running time for generators

thereby reducing their run-hours, minimising the use of

non-renewable energy.

Prevention of Green House Gasses (GHG):

Challenge: Greenhouse gas emissions from generators.

Response:(i) The Company has upgraded its procurementprocesses to ensure the acquisition of EU-certified low

emission generators.

(ii) Programmes to monitor greenhouse gasses in

compliance with local legislation were carried out and

results submitted to the Environmental Management

Agency. Results achieved were in the blue zone, indicating

normal acceptable levels.

Waste-Management and Recycling:

Challenge:Disposal of hazardous substances.

Response:The Company has developed and implemented

procedures on the management of hazardous substances

Reforestation and rehabilitation:

Challenge:Construction sites often require deforestation

and some environmental modification which must be

rectified.

Response: (i) The Company ensures that, during tower

construction, there is minimisation of interference

with vegetation such as cutting down of trees and,

where vegetation is removed, the business carries out

reforestation and rehabilitation.

(ii) The business has embarked on a project to put eco-

friendly towers such as lamp posts and monopoles

consistent with Good International Industry Practice.

Future Programmes for 2013-14Econet Wireless is currently strengthening the SHE system

consistent with International Finance Corporation (IFC)guidelines and performance standards. This entails the

development of the Environmental and Social Management

System (ESMS) manual and its implementation. The focus

will be on reviewing the existing SHE policy, conducting a

gap analysis and development of a risk register based on

detailed risk profiling of the business in order to align with

the IFC requirements.

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The Group remains committed to the principles of good

corporate governance. In addition to observing generally

accepted best practice standards, the Group applies and

complies with the principles enunciated in the King Code,

the listing rules of the Zimbabwe Stock Exchange, and the

Companies Act (Chapter 24:03). The Group recognises

that implementation of, and compliance with, all legal and

statutory requirements is in the best interests of the Group

and is crucial to the sustainable growth of the business.

Employee Benefits

Retirement funding

All full-time employees are members of the Groups

defined contribution pension fund and of the compulsory

defined benefit National Social Security Authority (NSSA)

fund. The Groups fund requires 5% of pensionable

earnings from the employee which is matched with 7%

of pensionable earnings by the Group. The NSSA fund

requires 3.5% of pensionable earnings, up to a ceiling of

$700 per month from employees and the same from the

Group.

Incentives

In acknowledgement of the importance of incentivising

employees, the Group is in the process of enhancing its

incentive schemes and linking them to performance.

Remuneration

Industrial Relations

The Group seeks to achieve the highest level of good

industrial relations as evidenced by no industrial action by

employees against Group companies.

At the reporting date, there had been no industrial action

during the year and there was none in progress at that date.

Directors Remuneration

The Board oversees remuneration matters which are

confirmed by the shareholders.

Executive Remuneration

Executive remuneration is deemed to be an important

element in the sustainability of the Group and is linked to

the nature and responsibilities of the executives position as

well as on market benchmarks and individual performance.

Non-executive Remuneration

Non-executive directors remuneration is subject to

shareholder approval.

Remuneration of directors and other members of key

management during the year is disclosed in note 34.3 of

the financial statements.

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Our people and our community

Human Capital (HC)Econet Wireless attained employer of choice status

through its strong employer brand equity in the market.

We are competitive in attracting and retaining talent both

locally and abroad as evidenced by our strong leadership

team, and our exceptionally low staff attrition rate of

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person for the year, a figure slightly above the international

benchmark of five (5) training days per staff member per

year according to the Chartered Institute of Personnel

Development (CIPD).

Our objective is to achieve at least eight (8) training days

per staff member per year.

Learning Return-on-Investment methodology

We have implemented a Learning Return-on-Investment

Methodology to ensure that we validate the added value

of people development initiatives.

To support this initiative, we have partnered with leading

service providers in developing and implementing training

and development interventions.

Achievements

100% pass rate on a public exam administered by the

Zimbabwe Institute of Management.

substantive positions within the various divisions.

trainee chartered accountants to go through their

articled clerk training under the supervision of qualified

chartered accountants within Econet.

100 % pass rate in their final qualifying examination.

overall student nationally.

Objectives for 2013-14

through training the entire organisation and conductingexternal customer satisfaction surveys.

business Performance Management System in line

with the newly implemented Paterson Job Evaluation

System.

line with business strategic objectives and target 1:1

cover ratio for identified critical positions.

culture - consistent with our pioneering value.

to manage head count in the FY 2013-14 in line with the

business strategic objectives.

Age Distribution

The Age Distribution graph shows that the organisations

manpower lies between the range of 26 to 45 years. The

young vibrant workforce has assisted the business in

achieving its strategic objectives through professionalism

and pioneering.

Deliverable - Continuous employee engagement

The CEO embarks on roadshows so as to reach out to

all staff members. Econet Wireless believes it is vital to

keep staff informed about issues that affect the Group

and themselves. As a result, the Group has established a

range of communication processes that will ensure open

and effective two-way communication throughout the

Group. We aim to achieve an Engagement index of over

70% as this is considered a good result for high performing

organisations.

Deliverable - Reward management philosophy

The business will continue to pay market competitive

remuneration in line with our Total Cost to Employer

remuneration model. Our objective is to pay above the 75th

percentile of the market, as a way of attracting and retaining

talent locally, regionally and internationally. The business

shall always seek to ensure that it does not lose talent on

the basis of remuneration. The strong reward philosophy

has played a pivotal role in the significant progress made

by the business in retaining staff as evidenced by the low

attrition rate of

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Corporate social investment Community and Trusts

Higher Life FoundationAs part of its community involvement and bringingcommunity transformation, Econet Wireless hasestablished the Higher Life Foundation which activelymanages the three corporate responsibility vehicles.

marginalised children

socially responsible and academically gifted students.

of the nation

1. Capernaum TrustThe Trust was established in 1996 with the vision oftransforming the lives of the disadvantaged and orphanedchildren into history makers with a leadership mind-setfor Global Impact. Since inception, Capernaum Trust haspositively changed the lives of more than 70 000 childrenin Zimbabwe.The Trust provides a holistic approach in the care of thechildren including scholarships, needs-based food andhealth support, and counselling services.There are visits which are conducted on a regular andplanned basis. All the students under this program areprofiled and known by name and face under the Knowyour Flock banner.During the year, the Trust embarked on an innovativeproject of establishing and resourcing 15 state-of-the-art Academic Resource Centres and libraries in selectedschools across Zimbabwe. These Centres are equippedwith internet facilities, computers and e-learning facilities.In addition, a wide selection of study books coveringprimary, secondary and tertiary levels were also distributedto the Resource Centres.

2. National Healthcare Trust ZimbabweThe Trust was established in 2008 with the objective ofbeing the Partner of choice in all programmes aimed atresponding to national health care crisis such as cholera,as well as building and maintaining capacity in the nationalhealthcare delivery system.

In the period under review, the NHT significantlycontributed to health delivery systems in Zimbabwethrough: responding to a typhoid crisis; health informationsystems development; mobile health solutions; healthinfrastructure development; human resources for healthdevelopment; special surgical procedures and other healthdelivery related activities.

Of special mention is the College of Health Sciences,University of Zimbabwe project- Virtual Learning Hall. TheNational Health Care Trust continued to support the VirtualLearning Hall it established in the previous year at theCollege of Health Sciences with bandwidth for effectiveand efficient connectivity. To date the facility has eleven (11)regular partnering universities in France, England, UnitedStates of America, South Africa, Germany, India, Tanzaniaand the Netherlands. Over 500 students have accessedthe learning hall for lectures and research seminars insubjects ranging from Anatomy, Physiology, Dentistry,Pharmacy, Veterinary Sciences, Computer Sciences, andBiochemistry. Over 52 lectures have been held excludingshort courses, seminars and once-off lectures. The

lectures are stored for later access by students on theserver that came with the video conferencing equipmentand are available through the University of Zimbabwewebsite.

Another important project to highlight is the Mobile HealthClinics initiative- The Trust piloted Mobile Health Solutionswhere integrated primary healthcare services wereprovided through the use of a mobile health clinic. Nine (9)medical outreach clinic sessions were carried out.

3. The Joshua Nkomo Scholarship FundThe scholarship fund was established in 2005 to supportacademically gifted and socially responsive students on a

full scholarship basis. The vision of the JNSF is to promoteand equip students who demonstrate high academicexcellence and community involvement to help themtransform their communities and the nation at large. Over700 students are currently benefiting from this prestigiousand transformational scholarship scheme.

The scholarships are awarded to students drawn fromall provinces of Zimbabwe based on their record ofeducational performance and community leadership.Leadership and mentoring courses are periodically heldto equip the students with skills. A numbers of thesestudents ,Joshualites, have been enrolled in internationaluniversities such as Yale, Harvard, Massachusetts Instituteof Technology, Columbia & University of Pennsylvania.

PeopleandCommunity

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Econet is getting everyone connected everywhere. Econet has the widest voice anddata coverage as a result of the massive investment in network infrastructure.

Inspiring Innovations

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Directors responsibility for financial reporting

The Board of Directors is responsible for the integrity and objectivity of the financial statements and related information

contained in this annual report. The Board considers that the financial statements have been prepared in accordance with

applicable accounting standards and is satisfied with the integrity of the information provided. The Groups independent

external auditors, Messrs Ernst & Young Chartered Accountants (Zimbabwe), have audited the financial statements and

their report appears on page 48 of this annual report.

In the discharging of this responsibility, the Directors ensure that the Group maintains effective systems of internal

control. The systems seek to provide reasonable assurance as to the accuracy and reliability of the financial systems as

well as safeguard and maintain accountability over the Groups assets.

The Directors have reviewed the performance and financial position of the Group up to the point of signing of the financial

statements and are satisfied that it is a true reflection of the Groups position. The Board has concluded that the Group

has adequate resources to continue as a going concern for the foreseeable future.

The financial statements set out on page 49 to 129 were approved by the Board of Directors on 14 May 2013 and signed

on its behalf by:

Dr J. Myers D. Mboweni K. V. Chirairo

CHAIRMAN OF THE BOARD CHIEF EXECUTIVE OFFICER FINANCIAL DIRECTOR

14 MAY 2013

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In my capacity as the Group Company Secretary, I hereby confirm, in terms of the Companies Act (Chapter 24:03), that,

for the year ended 28 February 2013, Econet Wireless Zimbabwe Limited has lodged with the Registrar of Companies all

such returns as are required of a public company in terms of the Companies Act and that all such returns are, to the best

of my knowledge and belief, true and correct and up to date.

C. A. Banda

GROUP COMPANY SECRETARY

14 MAY 2013

Certificate by the Group Company Secretary

CHARLES A. BANDA- Group Company Secretary

FinancialStatements

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Consolidated Statements of Financial PositionAs at 28 February 2013

All figures in US$ Note 2013 2012

ASSETSNon-current assets

Property, plant and equipment 12 690,805,885 605,846,714Investment property 13 951,517 411,000

Intangible assets 14 9,492,568 7,991,004

Deferred tax asset 15.1 5,642,613 2,686,315

Goodwill 44.1 6,090,632 -

Investment in associate 18.1 14,061,120 8,974,389

Financial instruments:

-Held-to-maturity investments 17 9,896,415 14,161,138

-Available-for-sale investments 19 3,010,797 4,692,566

Total non-current assets 739,951,547 644,763,126

Current assets

Inventories 22 14,443,786 12,054,662

Financial instruments:

-Trade and other receivables 23 63,105,361 54,763,082

- Financial assets at fair value through profit or loss 21 58,006 52,976

- Loans and advances to bank customers 24.1 119,321,627 -

- Cash and cash equivalents 33.4 78,229,628 100,792,971

Total current assets 275,158,408 167,663,691

Total assets 1,015,109,955 812,426,817

EQUITY AND LIABILITIES

Capital and reserves

Share capital and share premium 26.2 35,697,496 33,124,930

Retained earnings 453,138,968 345,478,251

Other reserves 27 568,775 1,342,726

Equity attributable to owners of Econet Wireless Zimbabwe Limited 489,405,239 379,945,907

Non-controlling interests 3,477,998 2,847,008

Total equity 492,883,237 382,792,915

Non-current liabilities

Deferred tax liability 15.2 85,493,429 70,667,055

Financial instruments - Long-term interest-bearing debt 31.1 202,799,895 103,338,155

Total non-current liabilities 288,293,324 174,005,210

Current liabilities

Provisions 29 - 3,466

Deferred revenue 30 10,127,617 10,515,168

Financial instruments:

-Trade and other payables 28 118,871,498 90,661,877

- Short-term interest-bearing debt 31 61,771,039 145,800,362

- Deposits due to banks and customers 32.3 36,350,711 -

Income tax payable 33.3 6,812,529 8,647,819

Total current liabilities 233,933,394 255,628,692

Total liabilities 522,226,718 429,633,902

Total equity and liabilities 1,015,109,955 812,426,817

Dr J. Myers D. Mboweni K. V. Chirairo

CHAIRMAN OF THE BOARD CHIEF EXECUTIVE OFFICER FINANCE DIRECTOR14 May 2013

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Consolidated Statements of Comprehensive IncomeFor the year ended 28 February 2013

All figures in US$ Note 2013 2012

Revenue 2 694,843,608 611,115,533

Cost of sales and external services sold (182,955,954) (159,156,746)

Gross profit 511,887,654 451,958,787

Net interest income from banking operations 3.2 926,513 -

Net fees and commission income from banking operations 8 20,504 -

Other income 9 1,534,333 1,580,889

Gain on disposal of available-for-sale investments 19.1 - 11,693,274

Gain on disposal of interest in former subsidiary 43.3 - 2,941,972

Gain on financial assets at fair value through profit or loss 21 5,030 -514,374,034 468,174,922

Operating expenses

-General administrative expenses (140,686,551) (124,170,919)

-Marketing and sales expenses (17,961,279) (13,969,662)

- Network expenses (45,434,962) (35,450,814)

- Other expenses (4,947,261) (3,689,201)

Profit before interest, taxation, depreciation, impairment and amortisation 305,343,981 290,894,326

Depreciation and amortisation (71,563,248) (46,497,440)

Profit from operations 4 233,780,733 244,396,886

Finance income 6 2,653,217 2,105,472Finance costs 7 (28,600,048) (10,202,838)

Share of (loss)/profit of associate 18.3 (2,930,659) 2,830,389

Profit before taxation 204,903,243 239,129,909

Income tax expense 10 (64,965,023) (73,388,821)

Profit for the year 139,938,220 165,741,088

Other comprehensive income

Available-for-sale reserve recycled to profit or loss 19.1 - (3,885,824)

Loss on available-for-sale investments 19 (781,769) (696,996)

Taxation effect of other comprehensive income 5 7,818 159,652

Other comprehensive income for the year, net of tax 5 (773,951) (4,423,168)

Total comprehensive income for the year 139,164,269 161,317,920

Profit for the year attributable to:

Equity holders of Econet Wireless Zimbabwe Limited 139,593,292 165,734,129

Non-controlling interests 344,928 6,959

139,938,220 165,741,088

Total comprehensive income attributable to:

Equity holders of Econet Wireless Zimbabwe Limited 138,819,341 161,310,961

Non-controlling interests 344,928 6,959

139,164,269 161,317,920

Basic earnings per share (dollars) 11 0.09 0.10

Diluted basic earnings per share (dollars) 11 0.09 0.10

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Consolidated Statements of Changes in EquityFor the year ended 28 February 2013

All figures in US$

Share capitaland sharepremium

Retainedearnings

Otherreserves Total

Non-controlling

interest Total

Balance at 28 February 2011 22,980,326 258,891,276 5,765,894 287,637,496 2,840,049 290,477,545

Profit for the year - 165,734,129 - 165,734,129 6,959 165,741,088

Other comprehensive income - - (4,423,168) (4,423,168) - (4,423,168)

Realisation to profit or loss on disposal of available-for-sale investment (Note 19.1)

- - (3,885,824) (3,885,824) - (3,885,824)

Fair value loss on available-for-sale investments - - (696,996) (696,996) - (696,996)

Taxation effect of other comprehensive income - - 159,652 159,652 - 159,652

Total comprehensive income - 165,734,129 (4,423,168) 161,310,961 6,959 161,317,920

Transactions with equity holders of EconetWireless Zimbabwe Limited

10,144,604 (79,147,154) - (69,002,550) - (69,002,550)

Issue of shares 10,144,604 - 10,144,604 - 10,144,604

Dividend in specie - (10,535,742) - (10,535,742) - (10,535,742)

Cash dividend - (40,160,937) - (40,160,937) - (40,160,937)

Share buy-back (Note 16.4) - (28,450,475) - (28,450,475) - (28,450,475)

Balance at 29 February 2012 33,124,930 345,478,251 1,342,726 379,945,907 2,847,008 382,792,915

Profit for the year - 139,593,292 - 139,593,292 344,928 139,938,220

Other comprehensive income - - (773,951) (773,951) - (773,951)

Fair value loss on available-for-sale investments - - (781,769) (781,769) - (781,769)

Taxation effect of other comprehensive income - - 7,818 7,818 - 7,818

Total comprehensive income - 139,593,292 (773,951) 138,819,341 344,928 139,164,269

Transactions with equity holders of EconetWireless Zimbabwe Limited

2,572,566 (31,932,575) - (29,360,009) 286,062 (29,073,947)

Issue of shares 1,684,577 - - 1,684,577 - 1,684,577

Cancellation of shares bought back (731,008) - - (731,008) - (731,008)

Share buyback (Note 16.4) - (31,932,575) - (31,932,575) - (31,932,575)

Acquisition of subsidiary - - - - 286,062 286,062

Disposal of treasury shares 1,618,997 - - 1,618,997 - 1,618,997

Balance at 28 February 2013 35,697,496 453,138,968 568,775 489,405,239 3,477,998 492,883,237

Other reserves - Other reserves are detailed in Note 27 and consist of reserves arising from the valuation of available-

for-sale financial assets. Where a revalued financial asset is sold the portion of the reserve that relates to that financial

asset is effectively realised and recognised in profit or loss. Where a revalued financial asset is impaired the portion of

the reserve that relates to that financial asset impairment is also recognised in profit or loss.

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Consolidated Statements of Cash FlowsFor the year ended 28 February 2013

All figures in US$ Note 2013 2012

Operating activities

Cash generated from operations 33.2 216,176,544 315,327,155

Income tax paid 33.3 (53,096,888) (36,465,392)

Net cash flows from operating activities 163,079,656 278,861,763

Investing activities

Finance income 2,653,217 1,834,505

Acquisition of intangible assets (Note 14) (565,570) (3,860)Acquisition of available-for-sale investments (134,406) (2,994,047)

Proceeds on disposal of available-for-sale financial assets - 5,285,524

Acquisition of held-to-maturity investments (1,872,598) (3,212,410)

Acquisition of associate 18.2 (20,000,000) -

Net cash inflow on acquisition of subsidiary 44.1 16,597,539 -

Purchase of property, plant and equipment - to expand operating capacity (147,043,725) (216,010,394)

Proceeds on disposal of property, plant and equipment - 2,326,522

Net cash outflow on disposal of interest in former subsidiary 43.2 - (1,639,442)

Net cash used in investing activities (150,365,543) (214,413,602)

Financing activities

Finance costs (33,359,941) (10,202,838)

Dividends paid - (36,371,846)

Share buy-back (25,413,484) (28,450,475)

Proceeds from borrowings 52,000,000 132,910,541

Repayment of borrowings (31,807,690) (56,231,257)

Issue of shares 3,303,659 -

Net cash flows (used in)/from financing activities (35,277,456) 1,654,125

Net (decrease) / increase in cash and cash equivalents (22,563,343) 66,102,286

Cash and cash equivalents at the beginning of the year 100,792,971 34,690,685

Cash and cash equivalents at the end of the year 33.4 78,229,628 100,792,971

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F

inancialStatements

Accounting Policy IFRS/IAS reference Content

note note

4-9, 39, 40 A IAS 1 Presentation of financial statements: General information and

functional currency

B IFRS 1 (revised) First-time adoption of IFRS

C IAS 8 Change in accounting policies, adoption of new and revised

Standards

37.2 D IAS 21 Effects of changes in foreign exchange rates

16,34,43,44,47 E IFRS 3, IAS 27 Business combinations, basis of consolidation

18 F IAS 28 Investment in associates14 G IAS 38 Intangible assets

12 H IAS 23 Borrowing costs

12, 25, 41 I IAS 16 Property, plant and equipment

13 J IAS 40 Investment properties

36 K IAS 36 Impairment of property, plant and equipment, investment property,

and intangible assets

38 L IAS 17 Leases

22 M IAS 2 Inventories

2, 3, 30 N IAS 18 Revenue

5, 10, 15 O IAS 12 Income taxes

35 P IAS 19, 26 Employee benefits and retirement benefits

26.6 Q IFRS 2 Share-based payment

17, 19, 20, 21, 23 R IAS 32, 37, 39, IFRS 7, 9 Financial instruments

24, 28, 31, 32, 36

37, 42

16 S IAS 32 Treasury shares

1 T IFRS 8 Operating segments

29 U IAS 37 Provisions

V IFRS 5 Non-current assets held-for-sale and discontinued operations

36, 37 W Financial Guarantees

37 X Fiduciary Assets

37.3 Y IAS 1 (Revised) Significant assumptions and key sources of estimation uncertainty

11 IAS 33 Earnings per share

34 IAS 24 Related party disclosures

45 IAS 10 Events after the reporting period

Notes to the Consolidated Financial StatementsFor the year ended 28 February 2013

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1 OPERATING SEGMENTS

The principal activities set out below are the basison which the Group reports its primary segment

information.

For management purposes, the Group is organised

into business units based on their products

and services and has the following reportable

segments:

Cellular network operations

Econet Wireless (Private) Limited provides cellularnetwork services which form the main business of

the Group.

Banking operations

TN Bank Limited provides retail, corporate, andinvestment banking services in the key economic

centres of Zimbabwe.

Transaction processing s