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Integrated risk summary

	Exposure to currencies other than reporting currency Exposure to various currencies has an impact on MTN’s rand reported financial results and the servicing of foreign denominated expenses and liabilities. Fluctuations in the NGN/USD and the USD/ZAR have the most impact on the results.					Increased regulation Telecommunications is a regulated industry and of strategic importance as a key element of infrastructure to countries in which MTN operates. Regulatory requirements include telecommunication-related regulation such as licence renewals, SIM card registration, mobile termination rates as well as tax and central bank regulation which may have a negative impact on the Company’s revenue and profitability.
	Exposure to high risk countries MTN’s strategy is to be the leader in telecommunications in emerging markets. Emerging markets are generally higher risk countries. These risks include limited infrastructure, immature or unpredictable legal environments, human rights and security considerations as well as sanctions.

	Shortage of skilled human resources Experienced and skilled human resources in the telecommunications industry are scarce, potentially affecting business efficiency and effectiveness. This is exacerbated as competitors, also in search of similar expertise, attempt to attract MTN’s pool of talent.					Slowing revenue growth Subscriber growth is slowing as a result of increased voice penetration, more aggressive competition and increasing substitute products – for example VOIP and other-internetbased product offerings. These factors require MTN to respond to evolving industry and consumer trends toward a broader product offering including mobile and fixed data and other services. Regulatory interventions such as reduced interconnect tariffs creates additional pressure on revenue.
	Inability to timeously, effectively and efficiently invest and upgrade network and IT technology Although investments in networks is less of an issue than it was prior to MTN’s extensive capital expenditure programme in 2008 and 2009, investment is required to ensure capacity for new subscribers and more traffic from tariff reductions. Equally important is the planning of networks and IT technology upgrades to ensure appropriate ROI and the timely roll out to ensure the opportunity is not lost.
	Poor customer experience In order for MTN to maintain its leadership position and positive brand perception the customer experience is important. Ensuring MTN’s products are widely available with good customer service on all product ranges through all customer touch points are key factors.					Inability to maintain and/or grow profitability In combination with slowing revenue growth, MTN’s ability to maintain/reduce it costs is critical in order for it to continue to operate at historical profitability levels. Reducing the cost base and/or increased efficiencies will allow MTN to service lower-end customers as well as deliver a different product mix profitably.
	Inadequate governance and control The implementation of mature and well controlled processes such as revenue assurance, procurement, asset management and certain key financial controls are critical to MTN both from a profitability and governance point of view. In addition, aspects such as proper business continuity management procedures and governance structures are key factors.