(formely M-Cell Limited) - Business Report 2003 - MTN Group

Chairman’s report
(continued)
DISTRIBUTION TO SHAREHOLDERS
After due consideration, it is the Board’s view
that – in the best interests of shareholders – we
should maintain our policy of reinvesting
retained earnings in operations and reducing
borrowings where appropriate to ensure
continued growth. Accordingly, no final dividend
has been declared. Taking the strong cash
generation of the South African operations and
the reducing debt levels into consideration, the
dividend policy will be reviewed regularly to
ensure optimisation of shareholder value.
PROSPECTS
The Board is confident that the Group’s
operations will show satisfactory growth in the
year ahead. International operations are forecast
to increase their contribution to the Group’s
earnings and subscriber numbers, while MTN
South Africa is expected to maintain strong
positive cash flows.
APPOINTMENTS
As Chairman, it is my pleasure to welcome
Ms Sindisiwe Mabaso and Mr Alan van Biljon to
the MTN Group Board. Ms Mabaso is Financial
Director of the Transnet Group and Mr van Biljon
is a former Financial Director of the Standard
Bank Group. During the year, Mr C R Jardine
resigned from the Board and we thank him for
the contributions he has made. After year-end,
Ms Santie Botha joined the Board as Executive
Director Marketing. She was previously Group
Executive Director at Absa Bank.
SHAREHOLDER MATTERS
Management buy-in
The management buy-in, initiated by the
executive directors in October 2002, resulted in
management and staff acquiring 18,7% of the
issued share capital of MTN Group through
Newshelf 664 (Proprietary) Limited. An ad hoc
committee of independent non-executive
directors with the assistance of independent
advisors monitored the transaction and advised
shareholders (in an announcement dated
15 January 2003) that no negative impact on
MTN Group was foreseen. I am satisfied that the
Group provided no financial assistance to
facilitate the transaction. I believe that our
management’s and staff’s significant interest in
the Group will provide an additional
performance incentive at no cost – through
dilution or otherwise – to shareholders.
Johnnic unbundling of interest in MTN Group
On 3 June 2003, Johnnic shareholders approved
the unbundling of a 31,9% interest in MTN
Group to its shareholders. Arising from this, the
National Empowerment Consortium (NEC) now
has an estimated 8,8% interest in MTN Group.
The free float of MTN Group shares increased
to some 72,5% of the issued shares.
ACKNOWLEDGEMENTS
Having taken over as Chairman from Phuthuma
Nhleko, who was subsequently appointed Chief
Executive Officer, I wish to express my sincere
thanks to my team, the Board, the Chief
Executive Officer, executive management and
staff members throughout Africa for their
dedication, drive and determination to make
the MTN Group the leading telecommunications
company on the continent.
Cyril Ramaphosa
Chairman
19 June 2003
PAGE 8
MTN BUSINESS REPORT 2003