3 May 2011
Strong cash generation and record-high first quarter EBITDA
• Net sales increased 11.5 percent to SEK 27,204 million (24,398). Organic growth in local currencies was 0.6 percent.
• EBITDA, excluding non-recurring items, increased 13.7 percent to SEK 8,821 mil-lion (7,755) and the margin to 32.4 percent (31.8).
• Operating income, excluding non-recurring items, increased 10.8 percent to SEK 7,477 million (6,750).
• Net income attributable to owners of the parent company was SEK 4,440 million (4,465) and earnings per share SEK 0.99 (0.99).
• Free cash flow rose to SEK 4,282 million (1,110).
• During the quarter the number of subscriptions grew by more than 2.2 million, whereof 0.9 million new subscriptions in the majority-owned operations and over 1.3 million in the associated companies, to 137.0 million in total.
• Group outlook for net sales 2009 revised from the Year-end Report 2008.
(Table included in attached pdf)
Comments by Lars Nyberg, President and CEO
“The macroeconomic environment worsened during the first quarter and although the telecom services industry has been less affected than other industries there are signs of changed customer behavior in several of our markets. Still, we were able to grow net sales for the Group in local currencies and our efforts to reduce operational expenditures successfully improved our margins and cash flow compared to last year. I am especially pleased with the developments within Broadband Services where the margin improved considerably from the fourth quarter. In Eurasia, the economic downturn became more evident and sales growth slowed in the first quarter. Still, we managed to increase profitability from an already high level.
In Mobility Services, cost efficiency has to improve. We need to safeguard our profitability as sales are lowered in several markets by weaker equipment sales and reduced roaming due to less business travel. Regulatory intervention is also putting pressure on prices in all markets. At the same time it is very encouraging to see that the usage of mobile data is increasing substantially. This also requires us to meet the new and different needs of our customers. Therefore we have launched new, differentiated mobile broadband subscriptions in Sweden and Norway that better suit our customers’ individual needs. As one of the first operators in the world, we also plan to launch 4G-services next year for dramatically increased speed.
Looking ahead, it is essential for TeliaSonera to reduce cost especially in a period of increasing unemployment and we will also continue to scrutinize ways to reduce capital expenditure to preserve a strong cash generation. The macroeconomic trends are hard to predict but as a strong and financially balanced company TeliaSonera is very well equipped to meet the demands presented by a difficult economic environment and capture any opportunities that may arise.”
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