MTC announces Q1 earnings

The MTC Group is now serving 3.5 million customers as of March 31, 2005. During the first quarter of this year, MTC has recorded consolidated revenues of KD 90.11 million. The company posted consolidated EBITDA of KD 54.92 million for an EBITDA margin of 61% while consolidated net income reached KD 41.06 million. The net income figure translates to earnings per share of 76 Fils for the quarter.

Mr. Asaad Al-Banwan, MTC Chairman of the Board Said: "We are pleased to announce that MTC has posted very solid operational and financial results for the fist quarter of 2005. These results exceeded our budget expectations and are a confirmation that MTC has adopted the right vision and has implemented sound management strategies to achieve these targets. The regions where MTC operates have benefited from recent economic growth and the company is well positioned to compete for its share. As the company grows and diversifies its operations, we are confident of the promising long term future ahead for all MTC stakeholders." Mr. Al-Banwan went on to add: "On March 29th, 2005 MTC announced that it had entered into a binding agreement with the shareholders of Celtel International B.V. to acquire 100% of the issued capital of Celtel, the leading cellular operator in Sub-Saharan Africa. This transaction will propel MTC into the international arena and set the stage for the next phase of growth."

MTC Group Highlights

As of March 31st, 2005 the MTC group of companies is serving a growing customer base of over 3.491 million active customers in Kuwait, Jordan, Bahrain, Iraq, and Lebanon reflecting an increase of 69.13% when compared to March 31st, 2004.

MTC has recorded consolidated revenues of KD 90.11 million ($ 310.23 million) for the 3 months ended March 31st , 2005 an increase of 22.05% over the same period of 2004. During the first quarter, the consolidated EBITDA improved by 28% to reach KD 54.92 million ($ 189.09 million) representing an EBITDA margin of 60.95%. MTC has announced consolidated net income of KD 41.06 million ($141.37 million) representing 76 Fils (26 cents) per share for the first three months of 2005, an increase of 23 Fils compared to the results for the first three months of 2004 of 53 Fils (18 cents) per share.

Dr. Saad Al-Barrak, MTC Deputy Chairman and Managing Director said: "I want MTC to be the sweetheart of the World. We have exceeded the targets that we had set for ourselves for the first leg of our 3x3x3 strategy ahead of schedule. We have previously elaborated on this strategy where over a period of nine years we would take MTC from a Kuwait only GSM operation to become a global wireless operator. We have acquired Celtel and that will expand MTC Group's footprint into Africa. The MTC Group is now serving over 9.5 million customers in the Middle East and Africa. We will continue to apply the lessons learned during the past two and a half years allowing us to leverage from the synergy created throughout the MTC Group." Dr. Saad went on to add: "Coupled with the Celtel acquisition, the first quarter of 2005 results have confirmed MTC's place as the leader among its peers."

Select operational and financial highlights

KUWAIT

An increase of 44,795 customers in Kuwait during the first quarter of 2005 saw MTC Vodafone Kuwait close the first three months of the year with over 1.31 million active customers, maintaining a 60.3% market share while the total penetration rate of mobile customers in Kuwait is approaching 82% of the total population. Postpaid customers account for 26% of our total customers. Blended ARPU for the first three months of 2005 was KD 13.11 ($45.14). MTC Vodafone Kuwait posted revenues of KD 50.4 million ($173 million) with an EBITDA of KD 30.2 million ($104 million) for an EBITDA margin of 60%. Net profit in Kuwait for the first quarter was KD 24.6 million ($85 million). During the first quarter, MTC held its Annual General Assembly Meeting of Shareholders and agreed to distribute 160 Fils per share cash dividend as well as a 7% stock dividend. During the meeting, a new Board of Directors was elected to lead the company for the next three years. MTC Kuwait has continued to roll out leading edge technology and services while providing customers with the best value for money.

JORDAN

In Jordan, MTC's operating subsidiary PELLA (Fastlink) maintained its market leadership position by all financial and operating measures. Fastlink maintained an estimated 71% market share. Fastlink had 1.26 million customers at the end of March. Customers increased by 29.75% compared to the same period last year. During the first quarter, revenues increased by 10.5% when compared to the first quarter of 2004, reaching KD 32.11 million ($111 million). EBITDA in Jordan was KD 16.54 million ($ 56.95 million) for an EBITDA margin of 51.52%. Net profit for the period was KD 9.34 million ($ 32.15 million)

BAHRAIN

During the first quarter of 2005, MTC Vodafone Bahrain has increased its active customer base to 136 thousand customers giving MTC Vodafone Bahrain an 18.7% market share at the end of the period. MTC Vodafone Bahrain is providing nationwide 3G coverage. The company's financial performance is improving as it enters its second year of operation.

IRAQ

MTC's subsidiary Atheer has been in operation for 13 months. As of March 31st, 2005 Atheer's total active customers numbered 345,906 an improvement of 42% from December 31st, 2004. The company has 99% of its users as prepaid customers. Atheer management and employees are challenged to meet the demand for service as there is a healthy demand for mobile lines in the southern and central regions of Iraq where the company now operates. The company plans to accelerate network rollout increasing both capacity and coverage in order to accommodate more customers expecting to exceed 1 million customers before year end 2005.

LEBANON

MTC Touch has ended the first quarter of 2005 serving 446,202 customers. The 48 month management contract awarded to MTC by the Lebanese government has allowed the MTC Group to expand its regional presence while enhancing and maximizing all stakeholders' interests and returns.