Qtel reports strong performance in profit growth for six months to 30 June 2006

Qtel's Chairman Sheikh Abdullah Bin Mohammed Bin Saud Al-Thani said, "Once again, we have achieved excellent financial results as our home business here in Qatar has continued to show strong growth and our Omani business - Nawras - has once again demonstrated outstanding success having entered its second year of operations. Our results again this year show continuing healthy performance in terms of revenue and profit growth."

In the six months to 30 June 2006, the Group achieved revenues of QR 2,033 m (2005 - QR 1,353 m), an increase of 50.3% over the corresponding period last year, and an EBITDA of QR 1,259 m (2005 - QR 800 m), an increase of 57.3%. In achieving these results the Group has also successfully grown its mobile customer base by 76.5% over the corresponding period from 682,900 subscribers to 1,205,100.

The Group, on a consolidated basis achieved net profit (before royalty) of QR 1,124 m (2005 - QR 717 m), representing an impressive growth of 56.8%. Taking into account the royalty payable to the Government of Qatar, the Net profit of the Group attributable to Qtel's shareholders, is QR 858 m; a significant increase of 47.9% (2005 - QR 580 m).

The Group's mobile operations in Oman, Nawras, now has 394,100 customers connected to the network as of 30 June 2006. This represents a 25% market share for Nawras in just over a year since the company was launched. "We are confident that Nawras will continue to develop in Oman and achieve excellent financial results," said Sheikh Abdullah.

"Our business in Qatar saw revenue rise by 38.3%, over the corresponding period last year from QR 1,330 m to QR 1,839 m. The business also saw a strong EBITDA growth to QR 1,265 m, an increase of 40.6% compared to 2005. This revenue growth continues to be driven specially through our Wireless Services which grew its customer base by 35.1% to 811,000 achieving a revenue of QR 1,212 m (2005 - QR 838 m). Revenue from Wireline business also grew by 31.5% to QR 601 m (2005 - QR 457 m)."

"The business growth is expected to continue in the future with the launch of a wide range of products and services including 3G services and Triple Play. As the prestige partner and official telecommunications provider for the 15th Asian Games, Doha 2006, we plan to deliver state-of-the-art telecommunications services for the event which will also contribute to our business growth. Our investment in world-class technologies will serve our customers well for many years into the future and also help to make Qatar an attractive place for future events and programmes for business and commercial organizations."

Going forward, our plans to venture beyond Qatar continue as we look at other regional expansion opportunities," concluded Sheikh Abdullah.

As a result of the strong performance of the overall Group and taking into account the future requirements of the business, the Board of Directors declared an interim dividend distribution of QR 4.25 per share. This equates to 42.5% of the nominal value of the shares.