Directors’ report

for the nine months ended 31 December 2005

The directors have pleasure in presenting their report and audited financial statements for the nine months ended 31 December 2005.

Nature of business

MTN Group Limited (the MTN Group or the company), incorporated and domiciled in South Africa, carries on the business of investing in the telecommunications industry through its subsidiary companies, joint ventures and associate companies.

Subsidiary companies

Details of entities in which MTN Group Limited has a direct or indirect interest are set out in Annexures 1 and 2 of the financial statements on page 223 and page 225 respectively.

Directorate and Group Secretary

The composition and profiles of the board of directors of the MTN Group appear on page 13.

The Group Secretary is SB Mtshali, whose business and postal addresses are set out below:

Interests of directors and officers

During the nine months under review, no contracts were entered into in which directors and officers of the company had an interest, which significantly affected the business of the Group. The directors had no interest in any third party or company responsible for managing any of the business activities of the Group. The emoluments and perquisites of executive directors are determined by the Group Nominations, Remuneration and Human Resources Committee and approved by the Board. No long-term service contracts exist between executive directors and the company, with the exception of the contract of service between the Group Chief Executive Officer and the company, which commenced on 1 July 2002 and terminates on 30 June 2007.

The financial statements on pages 126 to 226 set out fully the financial position, results of operations and cash flows of the MTN Group. Note 1 to the financial statements provides an analysis of the financial results by geographic segment.

Reviews of financial results and activities

Reviews of financial results and the activities of the Group are contained in the reports of the Chairman, Group Chief Executive Officer, the Group Finance Director, the reviews of operations and the annual financial statements.

Share capital

Authorised share capital

There was no change in the authorised share capital of the company during the period under review. The authorised ordinary share capital of the MTN Group is 2,5 billion shares of 0,01 cent each.

The following are the movements in the issued and unissued ordinary share capital from the beginning of the accounting period to the date of this report:

Issued share capital

The issued share capital of the company was increased during the year by the allotment and issue of shares to employees who exercised share options in terms of the MTN Group Limited Share Option Scheme. The allotments are listed as follows:

Accordingly, at 31 December 2005, the issued share capital of the company was R166 532 (March 2005: R166 249) comprising 1 665 317 425 (March 2005: 1 662 496 630) ordinary shares of 0,01 cent each. No treasury stock was held at the date of this report.

Control of unissued share capital

The unissued ordinary shares are the subject of a general authority granted to the directors in terms of section 221 of the Companies Act, 61 of 1973 as amended (the Companies Act). As this general authority remains valid only until the next annual general meeting, which is to be held on 13 June 2006, members will be asked at that meeting to consider an ordinary resolution placing the said unissued ordinary shares, up to a maximum of 10% of the company’s issued share capital under the control of the directors until the next annual general meeting.

Further details of the authorised and issued shares, as well as the share premium for the period ended 31 December 2005, appears in note 17 of the annual financial statements.

Acquisition of the company’s own shares

At the last annual general meeting held on 10 August 2005, shareholders gave the company or any of its subsidiaries, a general approval in terms of sections 85 and 89 of the Companies Act, by way of special resolution, for the acquisition of its own shares. As this general approval remains valid only until the next annual general meeting, which is to be held on 13 June 2006, members will be asked at that meeting to consider a special resolution to renew this general approval until the next annual general meeting.

Distribution to shareholders

A dividend of 65 cents per share (March 2005: 65 cents) amounting to R1 082 million (March 2005: R1 076 million) was declared on Wednesday, 22 March 2006, in respect of the nine month period to 31 December 2005 payable to shareholders registered on Friday, 21 April 2006. The payments of future dividends will depend on the board’s ongoing assessment of the Group’s earnings, financial position including its cash needs, future earnings prospects and other factors.

Shareholders on the South African register who have dematerialised their ordinary shares receive payment of their dividends electronically, as provided for by STRATE. For those shareholders who have not yet dematerialised their shares, or may intend maintaining their shareholding in the company in certificated form, the company operates an electronic funds transmission service, whereby dividends may be electronically transferred to shareholders’ bank accounts. These shareholders are encouraged to mandate this method of payment for all future dividends.

Shareholders’ interest

Major shareholders

The following information was extracted from the company’s share register at 31 December 2005:

Disclosures in accordance with section 140A(8)(a) of the Companies Act and paragraph 8.63 of the JSE Listings Requirements

According to information received by the directors, the following shareholders held shares in excess of 5% of the issued ordinary share capital of the company:

*Although Newshelf 664 has an economic interest in 309 million MTN Group Limited shares, it currently only has voting rights over 243,5 million MTN Group Limited shares. Further details of the Newshelf 664 shareholding are provided on page 141.

Certain of these shareholdings are partially or wholly included in the nominee companies mentioned on page 129. Apart from this, the company is not aware of any other party who has a shareholding of more than 5% in the company.

The MTN Group Limited share option and incentive schemes

The company operates share option and incentive schemes (the schemes) and eligible employees, including executive directors, are able to participate in accordance with the schemes’ rules. The schemes are designed to recognise the contributions of executive directors, and eligible staff and to provide additional incentives to contribute to the company’s continued growth.

In terms of the company’s schemes, the total number of shares which may be allocated for the purposes of the schemes shall not exceed 5% of the total issued ordinary share capital of the company from time to time being 81 799 691 shares approved by shareholders in 2001.

Share-based payments

The company operates share option and incentive schemes and eligible employees, including executive directors, are able to participate in accordance with scheme rules. The vesting periods under the option scheme are: 20%, 20%, 30% and 30% on the anniversary of the second, third, fourth and fifth years respectively after the grant date of the options. The strike price for options allocated is market related and is equal to the market value of the MTN Group share at the close of business on the day prior to the approval granted by the board.

If the options remain unexercised after a period of 10 years from the date of grant, the options expire. Options are forfeited if the employee leaves the Group before the vesting date. Details of the share options outstanding at 31 December 2005 are as follows:

MTN Group Limited Share Option Scheme (the Option Scheme)

The following information is provided in accordance with the provisions of the Option Scheme:

The Group issues equity-settled share-based payment to employees. Equity-settled share-based payments are measured at fair value (excluding the effect of non market-based vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of the shares that will eventually vest and adjusted for the effect of non market-based vesting conditions. Fair value is measured using the stochastic model. The expected life used in the model as been adjusted, based on management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.

MTN Group Limited Share Option Scheme

The market weighted average share price on the dates that share options were exercised during the year was R49,22.

The options outstanding at the end of the year have a weighted average remaining contractual life of eight years (March 2005: nine years). During the nine months ended 31 December 2005, no options were granted. During the financial year ended 31 March 2005, options were granted on 1 December 2004. These options were granted at market value of R40,50 per option. The fair values were calculated using the stochastic model. The inputs into the model were as follows:

Expected volatility was determined by calculating the historical volatility of the company’s share price over the previous seven years. The expected life used in the model has been adjusted, based on management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations. The expected dividend yield was determined based on historical data.

Options exercised during the period under review yielded the following proceeds, after transaction costs:

Share options outstanding as at 31 December 2005 have the following terms:

MTN Group Share Incentive Scheme (the Incentive Scheme)

This incentive scheme was established when the company formed part of Multichoice Limited and no allocations have been made under this scheme since 2001. All share options granted under the scheme have been exercised or have expired. The following information is provided in accordance with the provisions of the Incentive Scheme.

Unvested and vested but not exercised shares are subject to cancellation upon termination of employment.

MTN Staff Incentive Scheme (the MTN Debenture Scheme)

The last vesting of conversion of debentures under the MTN Debenture Scheme occurred on 1 December 2004. No further allocations under this scheme are foreseen and hence the scheme will now be wound up.

Equity compensation benefits for executive directors and directors of major subsidiaries

MTN Group Limited Share Option Scheme for the nine months ended 31 December 2005

Share options exercised by directors

The share options exercised and resulting trades can be viewed under directors’ share dealings on page 140.

Directors’ shareholdings

The interests of the directors and alternate directors in the ordinary shares of the company were as follows:

*Shares acquired through the MTN Debenture Scheme.

No changes occurred in the above outlined shareholding subsequent to period end until the date of this report.

PF Nhleko,I Charnley,RD Nisbet,SL Botha and RS Dabengwa hold an indirect bene ficial interest in MTN Group shares through the management buy-in.Further details appear on page 141 of this report.

Directors’ share dealings

Shares traded by directors for the nine months ended 31 December 2005

#Shares exercised under the MTN Group Limited Share Option Scheme

Directors’ interests in MTN Group held through Newshelf 664 (Proprietary)Limited (Newshelf 664)

Newshelf 664 (Proprietary) Limited (Newshelf 664) has an economic interest in 309 million MTN Group Limited shares (equivalent to 18,6% (March 2005: 18,6%) of the issued capital of the MTN Group). These shares were acquired from Transnet Limited (Transnet) at an average price of R13,90 per share between December 2002 and March 2003. As a result of the funding structure for the purchase of these shares, at 31 December 2005 Newshelf 664 had voting rights over 243,5 million MTN Group shares (equivalent to 14,62% of the total voting rights of the MTN Group). Pursuant to a contractual undertaking contained in the original agreements for the funding of Newshelf 664, and as a prerequisite to the funders entering into the funding arrangements, Newshelf 664 was obliged to enter into a hedging transaction in terms of which voting rights in respect of a maximum of 65,5 million MTN Group Limited shares are the subject of a scrip-lending arrangement.

Newshelf 664’s ordinary shares are held by a trust (the Trust) for the benefit of eligible permanent staff employed by MTN Group Limited and its South African subsidiaries as well as eligible senior staff members of its African operations. This is expected to benefit approximately 2 400 eligible employees. Such benefits will vest over the sixyear funding period but will only become tradeable when all obligations of Newshelf 664, including all debt and equity related funding obligations to certain financing institutions, have been met, and thereafter in accordance with the terms of the Trust Deed.

The Trust has five trustees, two of whom are directors of MTN Group, namely PF Nhleko and I Charnley. The other trustees, W Lucas-Bull, PM Jenkins and Z Sithole, are independent. Furthermore, all the directors of Newshelf 664 have been appointed by the Trust, such directors being PF Nhleko, I Charnley, RD Nisbet and RS Dabengwa (jointly, the Newshelf 664 directors). The Newshelf 664 directors as well as SL Botha (jointly, the executive directors) are also included amongst the eligible employees who are potential beneficiaries of the Trust. Consequently, the interests of the executive directors in respect of the MTN Group shares held by Newshelf 664 are as follows:

• As a result of being trustees of the Trust, PF Nhleko and I Charnley, together with the other trustees, have an indirect, non-beneficial interest in the MTN Group shares which are currently held by Newshelf 664.

• As a result of being directors of Newshelf 664, the Newshelf 664 directors have an indirect, beneficial interest in respect of the voting rights pertaining to the MTN Group shares which are currently held by Newshelf 664.

• As a result of being beneficiaries of the Trust, the executive directors have an indirect, beneficial interest in the MTN Group shares which are currently held by Newshelf 664. This beneficial interest is in the form of rights to participate in a predetermined ratio (the participation ratio) in the net surplus in Newshelf 664 (if any) which may arise once all of Newshelf 664’s obligations have been met, including settlement of all funding. Certain of the financial institutions who funded the acquisition of the MTN Group shares also participate in the growth of the MTN Group shares. The participation ratio in the net surplus of Newshelf 664 of each executive director is as follows:

  – PF Nhleko	7,9270% (March 2005:7,9270%)
  – I Charnley	5,5869% (March 2005:5,5869%)
  – RS Dabengwa	5,5869% (March 2005:5,5869%)
  – RD Nisbet	5,5869% (March 2005:5,5869%)
  – SL Botha	1,1634% (March 2005:1,1634%)

Subject to the terms and conditions of the Trust Deed, the rights to participate will accrue to the executive directors in equal tranches of 16,6666% per annum for six years on the condition that, in the event that any executive director is not in the employment of the MTN Group at the end of the six-year period, he or she will only be entitled to that percentage of the rights to participate which will have vested prior to the executive director leaving the employment of the MTN Group.

In addition, the Newshelf 664 directors have exercised an option to participate in 0,23% of the economic benefits attaching to the “B” class redeemable preference shares and the “B” class participating preference share held by the Public Investment Corporation (the PIC), as funders to Newshelf 664, for which option the Newshelf 664 directors jointly paid an amount of R5 million. The capital acquisition consideration paid by each executive director was as follows:

The Newshelf 664 directors thus have an indirect beneficial interest in the MTN Group Limited shares acquired by Newshelf 664 to the extent that the proceeds of such shares (dividends and capital) are required to service and settle the preference share funding provided by the PIC, but only to the extent of the proportion that their funding of the preference shares bears to the total PIC funding.

Effective 31 March 2005 but still subject to various suspensive conditions, Newshelf 664 concluded an agreement (the early redemption agreement) with, inter alia, Transnet and the PIC, for the purpose of redeeming early certain of the funding instruments which were issued by Newshelf 664 between December 2002 and March 2003 to raise the funding required to acquire its stake of 309 million MTN shares. As all of these suspensive conditions were not fulfilled, the agreement has been terminated.

Directors’ emoluments and related payments for the nine months ended 31 December 2005

Directors’ emoluments and related payments for the year ended 31 March 2005

Performance bonuses

Performance bonuses for executive directors are linked to operational and financial value drivers pertaining to business performance against budget for individual operations and the MTN Group as a whole. These value drivers are determined by the board every year in respect of the next financial year. Each executive director’s performance bonus is conditional upon achievement of their specific value drivers and key performance indicators, which are structured to retain a balance between the performance of entities for which they are directly responsible, and that of the Group. In order to align incentive awards with the performance to which they relate, bonuses above reflect the amounts accrued in respect of each year and not the amounts paid in that year. The bonuses are determined by the Group nominations, remuneration and human resources committee, and approved by the board.

Property, plant and equipment

There were no changes in the nature of property,plant and equipment nor in the policy regarding their use during the period under review.

American depository receipt facility

A sponsored American depository receipt facility has been established.This ADR facility is sponsored by the Bank of New York and details of the administrators are reflected under the administration page 241.

Acquisitions

Details of the MTN Group acquisitions and disposals are presented in the Group Chief Executive Officers’s report.

Borrowing powers

In terms of the articles of association of the company, the borrowing powers of the company are unlimited, however all borrowings by the MTN Group are subject tolimitations specified in the treasury policy of the Group. The details of borrowings appear in note 19 of the annual financial statements.

Post balance sheet events

There were no significant post balance sheet events between the end of the period under review and the date of this report.

Material resolutions

Details of special resolutions and other resolutions of a signi ficant nature passed by the company and its subsidiaries during the nine month period under review requiring disclosure in terms of the listing requirements of the JSE are as follows:

MTN Group

• To approve an authority for the company and/or a subsidiary of the company,to acquire shares in the company.

Subsidiaries

• There were no material special resolutions passed by the subsidiaries of the company during the period under review.

Directors and Group Secretary

There were no appointments to, nor resignations from the board during the period under review.

In accordance with the articles of association of the company, one third of the Board is required to retire by rotation at each annual general meeting. Retiring directors are those who have been in office the longest since their last re-lection and directors who have been appointed between annual general meetings.

Profiles of the directors seeking re-election are contained in the notice of the annual general meeting which forms part of the annual financial statement.

The directors retiring by rotation at the forthcoming annual general meeting in terms of the articles of association are RD Nisbet and JHN Strydom.

Non-executive directors do not hold service contracts with the company.

The office of the secretary was held by Mr LC Jooste (Acting Group Secretary) until 31 July 2005. With effect from August 2005, Ms SB Mtshali was appointed as Group Secretary.

Change in year-end

The financial year-end of MTN Group Limited and most of its subsidiaries has been changed to 31 December.This change has been effected to ensure that the Group ’s reporting dates are better aligned with most of its international peers and also to improve the effecienciency of certain administrative processes.

Going concern

The directors have reviewed the MTN Group ’s budget and cash flow forecast for the year to 31 December 2006. On the basis of this review,and in light of the current financial position and existing borrowing facilities, the directors are satis fied that the MTN Group has access to adequate resources to continue in operational existence for the foreseeable future and is a going concern and have continued to adopt the going concern basis in preparing the financial statements.

Auditors

PricewaterhouseCoopers Inc.and SizweNtsaluba VSP will continue in officece as joint auditors in accordance with section 270(2) of the Companies Act, 61 of 1973, as amended.