Analyst Briefing

3 July 2018

Telekom Malaysia Berhad

Company Update

AGENDA

2

Background

2018 Headline Key Performance Indicators (KPI)

Performance Improvement Programme 2018 (PIP 2018)

1

2

3

4 New Broadband Plans

Given evolving market dynamics and operational environment, our financial

performance as of 1Q2018 remains challenging

• Increasing % of convergence

households

• Implementation of initiatives and

studies relating to increasing

productivity, ie workforce and

sweating assets

• Continued investment for long-

term growth – cost and CAPEX in

line with expansion plans

2.96

2.85

1Q2017 1Q2018

RM

bn

Revenue-4.0%

311.9

219.7

1Q2017 1Q2018

RM

mn

Normalised EBIT

-29.6%

Twin Core

Data Centre

Vertical

Solutions

NGBH™Hub

Ecosystem

Latest Offerings 2017 - 2018 Challenges across all customer clusters

affected 1Q2018 revenue

3

1Q2018 Recap Initiatives undertaken

unifi Home unifi TV

unifi Mobile unifi Wifi

We anticipate the headwinds to persist this year, changing the landscape. Thus, we are

revising our 2018 Headline KPIs

4

1.

3.

2.

4.

Challenges

Revenue Growth (%)

- 1 to FLAT

EBIT (RM)

Approximately

RM1.0 billion

Customer Satisfaction

Measure*

72

2018 Headline KPIs

INTENSIFYING

COMPETITION

POTENTIAL

BROADBAND

PRICE REVISION

REGULATORY

CHANGES

INCREASING COSTS

Revised Capex Guidance 2018:

20-22% of Revenue

*Global average 2017: 68

How we intend to adapt: our 4th wave of Performance Improvement Programme

(PIP 2018)

5

WAVE 1.0WAVE 2.0

WAVE 3.0

2006 - 2008 2009 - 2012 2013 – 2017

2018 - 2020

WAVE 4.0

• Declining voice segment

• Moderate industry growth

outlook

• Changing business

dynamics

• Maturing of products and

customer expectations

• Continued voice decline

• Demerger challenges

• Massive HSBB undertaking

• Potential Broadband price

revision

• Intensifying competition

• Increasing Regulatory

pressures

• Sustaining profitability

• Stabilise current business

• Revenue turnaround

• Boost execution capacity

• Improve efficiency

• Transform into

Information Exchange

and embark on

Convergence strategy

• Move customers up the

value chain

• Achieve best practice

cost and capital

efficiency in key areas

• Grow the top line

• Pursue cost and capital

improvements

• Build enabling

foundations

• Segment-based

management of core

business

• Revenue uplift and

monetisation

• Protect our base with lean

cost structure

• Transforming our business

operations through Digital

• Improve employee

productivity and efficiency

Challenges

Initiatives

*incorporating Perfexe10

6

Four pillars of PIP2018 to achieve our targets

1 432

PERFORMANCE IMPROVEMENT PROGRAMME 2018

PIP 2018 GOVERNANCE

A dedicated PMO team has been established to closely track & monitor the execution

INCREASED

PRODUCTIVITY

IMPROVED

CASH FLOW

SUSTAINED

PROFITABILITY

REVENUE

UPLIFT

Today’s Offering Entry level unifi

30Mbps

@ RM179

30Mbps

@ <RM100

> 40% lower than current

price

7

Affordable entry level unifi @ 30Mbps for B40 households available for pre-booking

starting 15th July 2018 at unifi.com.my

2010 - 2015

2016 - 2017

2018 onwards

Launch and initial years of

Broadband

Improvement Plan (BIP)

New

‘turbo’ plans

10Mbps

Basic unifi TV channels

30Mbps

All unifi TV channels (3x original speed)

More than

double the

speed

RM199 RM199 RM199

RM19.90 RM6.63(67% reduction of

original unit price)

8

RMx.xx(xx% reduction of

original unit price)

unifi ‘turbo’ plans offering much more than double the speed starting 15th August 2018 for

existing customers. New customers signing up to existing unifi plans shall enjoy the upgrade

in 2019

Note: Subject to technical availability and T&C

• Broadband speed

enjoyed

• Monthly bill

• Unit price

(per Mbps)

9

The unifi ‘turbo’ plans shall catapult Malaysia beyond majority of our regional peers

Unifi new package vs Regional Peers

Philippines

Singapore

Malaysia

Thailand

Vietnam

Bandwidth Speed

Indonesia

Pri

ce P

er

Mb

ps

Brunei

Malaysia

Unifi ‘turbo’

Malaysia

Key strategic

areas

ILLUSTRATIVE

Source : TM Internal analysis and industry sources. List non-exhaustive

Key Takeaways (1/2)

10

Revenue Growth (%)

- 1 to FLAT

EBIT (RM)

Approximately

RM1.0 billion

Customer Satisfaction

Measure*

72

2018 Headline KPIs

1

43

2

INCREASED

PRODUCTIVITY

IMPROVED

CASH FLOW

SUSTAINED

PROFITABILITY

REVENUE

UPLIFT

PIP 20181 2

Revised Capex Guidance 2018:

20-22% of Revenue

*Global average 2017: 68

Key Takeaways (2/2)

11

NEW unifi plans3

unifi ‘turbo’

plans

Entry level unifi

30Mbps

@ <RM100

> 40% lower than current

price

much more

than double

Special Upgrade

for pre-unifi

Re-launching

unlimited

postpaid mobile

Starting

15th

July 2018

Starting

15th

July 2018

Starting

15th

Aug 2018

Starting

15th

July 2018

Thank you!Corporate Finance & Investor RelationsLevel 11 (North Wing), Menara TMJalan Pantai Baharu50672 Kuala LumpurMalaysiaTel: (603) 2240 4848/ 7366 / 7388www.tm.com.my/investorinvestor@tm.com.my