TeliaSonera reports ‘best ever’ results

13 Feb 2007

Fixed line, mobile and broadband operator TeliaSonera has reported its financial results for 2006, showing net income of SEK19.28 billion (USD2.75 billion), up from SEK13.69 billion the previous year, on revenues that rose by 3.9% year-on-year to SEK91.06 billion. EBITDA, excluding non-recurring items, reached SEK32.27 billion (SEK29.41 billion) and the EBITDA margin improved to 35.4% (33.6%). Net income was impacted by positive one-off items amounting to approximately SEK1.7 billion, but reached a record high even excluding these items. President and CEO, Anders Igel, said that 2006 had been ‘our best ever year financially’.

The Stockholm-based group saw strong subscriber growth in the year, with 1.5 million new customers in majority-owned operations and 14.4 million new subscriptions in associated companies. Total subscribers increased by almost 20% in January-December, bringing the total number of customers at majority-owned subsidiaries to 30.2 million, with 65.9 million at the associated companies. In mobile communications, revenues increased by 34% in Eurasia, Norway (19%), the Baltics (9%) and Denmark (5%), with growth in Norway positively affected by the consolidation of MVNO Chess in 4Q 2005. In Sweden and Finland, sales decreased by 1% and 6% respectively, partly due to lower prices. In fixed communications, demand for broadband services remained strong in all of TeliaSonera’s markets. The acquisitions of NextGenTel in Norway and MicroLink in Estonia affected sales positively, although overall fixed line turnover decreased, mainly due to the migration to mobile and IP based services, particularly in Sweden.

Annual group CAPEX decreased to SEK11.1 billion, down from SEK11.58 billion the previous year, whilst the CAPEX-to-sales ratio decreased to 12.2% (13.2%). CAPEX decreased in all the Scandinavian markets, especially in fixed line business in Sweden and mobile in Finland. In the Baltics and Eurasia CAPEX increased, and start-up costs were incurred in Spain due to the commercial launch of new operator Yoigo in December.

As from 1 January 2007 TeliaSonera has reorganised its business areas into: Mobility Services, Broadband Services, Integrated Enterprise Services and a Eurasia division. Mobility Services covers consumers and businesses in Sweden, Finland, Norway, Denmark, Lithuania, Latvia, Estonia and Spain. Broadband serves consumers and SMEs in Sweden, Finland, Norway, Denmark, Estonia, Lithuania and associated operations in Latvia, alongside international carrier operations. Integrated Enterprise provides managed services for businesses in the Nordic and Baltic regions, and the Eurasian division comprises the group’s 74%-owned Fintur operations in Kazakhstan, Azerbaijan, Georgia and Moldova, and minority interests in 44%-owned Russian cellco MegaFon, Turkey’s Turkcell (37% owned) and Ukraine’s Astelit (55% controlled by Turkcell).

Sweden,Telia Company, Telia Sweden,

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