Q 1 2009 results April 2009 Management commentary

Q 1 2009 results April 2009

Management commentary to Stock Exchange about Q 1 2009 results The Group’s sales revenues in the first quarter were primarily impacted by regulations (European Union regulations applied on the mobile sector) and the economic downturn (reduction of sales of goods and changes in consumer behavior). At the same time, there is a continuing growth of mobile postpaid, mobile and fixed broadband TV customers. Thanks to efficiency programs that were previously implemented it was possible to compensate the loss of revenues by a proportional decrease of expenses and to maintain the EBITDA margin.

EMT’s market position Mobile postpaid users (in th. ) 473, 0 15, 0 Contractual 278, 000 480, 000 484, 000 487, 000 488, 000 June 08 Sept 08 Dec 08 -14, 000 3, 000 -1, 000 -3, 000 473, 000 1, 000 292, 000 275, 000 18, 000 293, 000 4, 000 Prepaid, Change 766, 000 278, 000 -18, 000 488, 0 779, 000 755, 000 March 08 +/- 777, 000 751, 000 4, 000 Prepaid March 2008 7, 000 Contractual, Change March 2009 March 09 EMT’s estimated market share (by number of active SIM-cards) was 47%

Elion’s market position No of permanent Internet connections (in th. ) No of IP and cable-TV customers (in th. ) Total means of communication (in th. ) March 2009 March 2008 +/- 176, 5 167, 5 9, 0 86, 9 63, 2 23, 7 461, 0 473, 0 -12, 0 54% of permanent Internet connections Others 46% Elion 54% 28% of paid TV market Elion 28% Market shares Elion Others 72% Others 100% 80% 46 72 0% Q 1 2009 80 81 Q 1 2008 Others 20% Elion 80% 54 Consumer broadband market 80% of fixed voice market 78 40% 54 19 46 60% 20 28 22 Q 1 2009 Q 1 2008 Paid TV market Q 1 2009 Q 1 2008 Fixed voice market

Financial results Eesti Telekom Group

Dynamics of sales • • Continued customers’ growth in broadband services and mobile communication segments; Sales revenues were primarily impacted by regulations that EU applies to the mobile sector and by the economic downturn Consolidated net sales growth, Y-to-Y, % -0. 8% -1. 0% -2. 9% 0. 2% -10. 0% Q 1 2008 Q 2 2008 Q 3 2008 Q 4 2008 Q 1 2009

ARPU

Dynamics of OPEX • Decline in retail and wholesale volumes Significant impact of efficiency projects to IT, maintenance and personnel costs • Consolidated OPEX growth, Y-to-Y, % 4. 6% -3. 4% -5. 2% Q 1 2008 Q 2 2008 Q 3 2008 -9. 6% Q 4 2008 Q 1 2009

Dynamics of EBITDA Consolidated EBITDA growth, Y-to-Y, % 6. 3% 3. 8% Q 1 2008 Q 2 2008 0. 1% Q 3 2008 -7. 9% -10. 3% Q 4 2008 Q 1 2009 EBITDA margin 38. 9% Mobile communications segment 39. 6% Broadband services segment 37. 4% 37. 0% 34. 1% Mobile communicatio ns segment 32. 3% 30. 6% m. EUR 37. 6% EBITDA 24. 5 23. 3 21. 0 15. 8 15. 7 21. 6 22. 8% Q 1 2008 Q 2 2008 Q 3 2008 Q 4 2008 Q 1 2009 15. 8 12. 0 Broadband services segment 27. 9% 17. 5 15. 8 Q 1 2008 Q 2 2008 Q 3 2008 Q 4 2008 Q 1 2009

CAPEX and depreciation Investing priorities: Broadband Development of network resources, changes in the product portfolio, the improvement of and expansion of the availability of the triple-service packages Mobile Implementation of technologies supporting high-speed data communications; IT Expansion of the infrastructure necessary for the provision of services

Cash position Proposal of the Management Board is to pay dividends for the year 2008 0. 67 EUR per share (92. 6 mln EUR in total); Dividends will be booked in May 2009 and paid in June 2009; Tax on dividends (24. 6 mln EUR) will be booked in May 2009 and paid in July 2009 Net gearing -14. 3% -13. 1% -19. 9% -25. 9% -29. 5% Q 1 2008 Q 2 2008 Q 3 2008 Q 4 2008 Q 1 2009

Largest shareholders of AS Eesti Telekom

Trading statistics in Tallinn SHARE INFORMATION Veerg 1 2005 2006 2007 2008 Year-end number of shares 137, 954, 528 Annual average number of shares 137, 954, 528 Equity per share, EUR 1. 87 1. 90 1. 99 Earnings per share, EUR 0. 50 0. 61 0. 70 0. 66 P/E ratio Dividends per share for the year (2008 – the Management Board proposal), EUR Dividend payout ratio, % 15. 1 13. 8 11. 2 5. 9 0. 58 0. 61 0. 67 114. 2 100. 1 96. 1 101. 0 AS Eesti Telekom has been listed on the Tallinn and London Stock Exchanges (OMX: ETLAT/LSE: EETD) since 1999. TRADING HISTORY ON THE TALLINN STOCK EXCHANGE (in euros) Veerg 1 2005 2006 2007 High 8. 60 8. 40 10. 77 7. 99 5. 25 Low 7. 10 6. 95 6. 57 3. 81 4. 10 Last 7. 60 8. 40 7. 80 3. 90 4. 64 5. 56 10. 53 -7. 14 -50. 00 18. 98 Change, % Traded volume 23, 749, 354 19, 336, 241 Turnover, mln Capitalisation, mln 2008 Q 1 2009 23, 693, 032 17, 636, 495 2, 788, 123 185. 83 148. 77 193. 36 116. 47 13. 55 1, 048. 45 1, 158. 82 1, 076. 05 538. 02 640. 11 Source: NASDAQ OMX Tallinn

Structure of the Group