Telecom Lead Europe: Millicom International Cellular has
generated more revenue from Value Added Services (VAS) than from voice in one
of its markets, Paraguay, its test-bed for innovation.

Millicom is planning to generate more than 50 percent of
revenue from Value Added Services by 2015 in Latin America, while continuing to
grow voice revenue.

At the end of June, 15.5 percent of customers were using
mobile data services in Latin America.

In the coming quarters Millicom will continue to invest
to strengthen innovation capabilities and to accelerate growth, through both
innovative categories and potentially external opportunities should they arise.

Millicom has invested $264 million as Capex in second
quarter of 2012.

The mobile operator’s Capex is 22.4 percent of revenue.

Capex for H1 was $436 million that is 18.6 percent of
revenues.

In 2012, Capex, excluding spectrum acquisition, will
increase but to remain below 20 percent of revenue, as we invest in IT and
billing platforms and add further data capacity.

In a somewhat challenging environment, we continued to
invest in improving our customer proposition. We are particularly pleased
having started harvesting benefits of these investments in Q2 with mild
acceleration of organic growth versus Q1. Underlying revenue grew 8.9 percent
in Q2 2012 in local currency versus 8.4 percent in Q1. In the first half of the
year, we accelerated investments in new growth categories, including staffing,
network building and handset subsidies which resulted in a dilution of our
EBITDA margin,” said Mikael Grahne, president and CEO of Millicom.

We have fine-tuned our 2012 EBITDA margin outlook as we
have now increased visibility on the level of commercial investments we will
undertake in the full year. Our previously communicated outlook for organic
growth, cash generation and capex remain unchanged,” Grahne added.

Financial summary for the quarters ended June 30, 2012
and 2011

 

$m   Q2 2012   Q2 2011   YoY percent change (local currency)   HY 2012   HY 2011   YoY percent change (local currency) Revenue 1,181 1,120 9.4 2,349 2,201 8.9 EBITDA (i) 513 513 3.6 1,030 1,022 2.7 EBITDA margin 43.4 percent 45.8 percent (2.4 pt) 43.8 percent 46.4 percent (2.6 pt) Normalized Net Profit(ii) 176 187 335 370 Capex (iii) 264 151 436 236 Operating FCF (iv) 140 268 450 517

The company expects the full year EBITDA margin to be
around 43 percent and operating free cash flow margin of around 20 percent of
revenue.

In Latin America, where Millicom generates 80 percent of
revenue, the top line grew by 10.4 percent in local currency in the second
quarter.

In Africa, top line growth in local currency increased by
5.7 percent in Q2.

In the first half of 2012 the Information category was
again the strongest contributor to growth, contributing more than half of the
revenue growth in local currency.

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