:06 Interim Report January - March 2001 Stockholm, 10 May 2001
Telia, AB, IR, eng :06 /Kh 2 President and CEO Marianne Nivert
Telia, AB, IR, eng :06 /Kh 3 Highlights Net sales increased by 5.7% to MSEK 13,592 Underlying EBITDA increased by 2.7% to MSEK 3,348 Strong margin improvement in the Swedish mobile operations Svenska UMTS-nät AB established together with Tele 2 Broadband portal launched Increased rate of broadband delivery Sale of Tess completed, 8 companies divested to Industri Kapital, DRS divested, offer on Eniro, Si.Mobil sold
Telia, AB, IR, eng :06 /Kh 4 Trends Higher prices for subscriptions and broadband Continued strong demand for broadband Shakeout in the carrier sector Reduced pressure on prices in fixed services Weaker growth in Swedish mobile, sharper focus on new services and streamlining Continued refining efforts within Telia
Telia, AB, IR, eng :06 /Kh 5 Q1-Q Q Scandinavia Online (listed) Altitun Q Q June IN good company AB Starman Kaabel- televisiooni AS Svefo AB Telia Contracting Telia Kompetens Telia Konferens Smålands- börsen Data AB Telia Academy AB System & Service A/S Eniro (listed) Sale of 51% in: Swedia Networks AB Telia Prosoft AB Respons AB Validation AB Telia Swedtel AB Telia Dokumentation AB Multicom Security AB TA Teleadress Information AB Combinator IT AB Eircom (Eircell) Telia Trading AB Si.Mobil DRS April 2001 Tess Eniro (offer) Continued refining
Telia, AB, IR, eng :06 /Kh 6 Growth International Carrier +9.6% Mobile +46% Group +5.7% Broadband +62% (cf. Q4 2000) Internet Services +24.6%
Telia, AB, IR, eng :06 /Kh 7 Mobile Sweden +7% GPRS Pilot test - Telia Mobile Online UMTS agreement complete New positioning services launched Norway +27% GPRS launched - NetCom MobiMail Denmark +85% License GSM 900 network Sales trend in the Nordic countries, total 46% Healthy improvement in profitability, underlying EBITDA +34% Pan-Nordic service launched in May 2001 Finland +191%
Telia, AB, IR, eng :06 /Kh 8 Mobile Total proportional customer base 4.9 million Total proportional customer base 4.9 million Norway 854,000 +4,000 Sweden 3,259,000 +2,000 GSM customer growth +33,000 Denmark 331, ,000 Finland 154,000 +5,000 1) Russia North West GSM (12.7% %) through Telecominvest 292, ,000 ** Estonia Eesti Mobiilitelefon (24.5%) 341, ,000 ** Latvia Latvijas Mobilais (24.5%) 285, ,000 ** Lithuania Omnitel (27.5%) 336, ,000 ** 1) Jan-Mar, excl. 91,000 SP customers 2) Jan-Mar, excl. 60,000 SP customers ** Total number of customers 2) Customer base, Nordic countries 4,598, ,000 Customer base, Nordic countries 4,598, ,000 Customer base, Baltic region/Russia 1,254, ,000 Customer base, Baltic region/Russia 1,254, ,000
Telia, AB, IR, eng :06 /Kh 9 Mobile Sweden, 3,259,000 Norway, 854,000 Denmark, 331,000 Finland, 154,
Telia, AB, IR, eng :06 /Kh 10 Mobile Sweden Churn 10% ARPU & MoU Prepaid Total Postpaid Prepaid Total Postpaid Without the reduction of interconnect fees from SEK 1.89 to 1.18, ARPU Q would have been SEK 298
Telia, AB, IR, eng :06 /Kh 11 Mobile ARPU & MoU Prepaid Total Postpaid Prepaid Total Postpaid Norway Churn 31%
Telia, AB, IR, eng :06 /Kh 12 Mobile SMS trends Share of sales, Q Sweden 4%, Norway 14% Share of sales, Q Sweden 4%, Norway 14% JanFebMarAprilMayJuneJulyAugSepOctNovDec
Telia, AB, IR, eng :06 /Kh 13 Real estate listings with prices in a specific local area for SALE G P R S Sweden: Telia Mobile Online Norway: NetCom MobiMail G P R S Sweden: Telia Mobile Online Norway: NetCom MobiMail House Close to You House Prices Close to You Right Way Near You Navigation service with maps Closest Resource Effective planning for business critical resources Bootfighters Position-based interactive games a virtual paintball P Micro-payment Mobile
Telia, AB, IR, eng :06 /Kh 14 Market trends Clear signs of impending shakeout with subsequent consolidation The turbulence gives Telia opportunities to take customers Lower demand on fiber and ducts Increased demand on leased capacity and wavelength – stiffer competition and more pressure on prices Pressure on prices for voice services – reserves for credit losses Competitors leaving the voice business for IP-based services International Carrier
Telia, AB, IR, eng :06 /Kh 15 Important events Powerful growth in the IP business +210% Growth in the IP capacity business +40% Services for virtual private networks, IP-VPN, and for colocation of IP servers (local services) launched Agreement with Ericsson signed for delivery of a global internal network for multimedia communications IP-agreements signed with Rostelecom and Baltelecom Capacity agreement signed with Sprint International Carrier
Telia, AB, IR, eng :06 /Kh 16 Viking Network – Telia’s global IP platform Infrastructure network expansion 31/ Total fiber network km (in use) 15,675 Ducts km (Europe)5,290 PoPs (total)52 Infrastructure network expansion 31/ Total fiber network km (in use) 15,675 Ducts km (Europe)5,290 PoPs (total)52 International Carrier
Telia, AB, IR, eng :06 /Kh 17 Signed contracts International Carrier (MSEK) StormFibre1,275 GTS Fibre432 Tele 1 Europe Fibre293 LD ComDucts47 Other (BT, France Telecom etc.)Fibre/Ducts1,571 Other (Sprint, Telenor, KPNQwest) 525 Total IRU4, Networks Fibre SWAP998 Global Crossing Ducts SWAP615 Williams Fibre SWAP664 Colt Ducts SWAP356 Other SWAPS (Nets, Infigate etc.)Fibre SWAP1,627 Total SWAPS4,260 Total8,403
Telia, AB, IR, eng :06 /Kh 18 External sales and price development MSEKQ1Q1Change in % Voice Leased IP capacity IP traffic Infrastructure380 Other220 Total Investments1, International Carrier
Telia, AB, IR, eng :06 /Kh 19 Two brands — Telia for retail customers — Skanova for network wholesale customers Migration from fixed telephony to broadband and mobile External network wholesale market (Skanova) provides growth and compensates for losses on the retail market Streamlining programs compensate for the effects of price cuts – but the prices have hit bottom Sustained underlying EBITDA margin for established services New services Telehost, IP telephony, split line Networks
Telia, AB, IR, eng :06 /Kh 20 Paying broadband customers Internet Services Narrowband Internet subscriptions increased by 11% from Q to Q (‘000) High speed Internet via cable
Telia, AB, IR, eng :06 /Kh 21 Broadband
:06
Telia, AB, IR, eng :06 /Kh 23 Bo Jacobsson CFO and Head of Corporate Financial Control
Telia, AB, IR, eng :06 /Kh 24 Key figures for the Group Financial overview MSEKQ1 2001Q Net sales13,59212,85754,064 Underlying EBITDA3,3483,26013,087 - margin % Operating income8113,38212,006 Earnings per share (SEK)
Telia, AB, IR, eng :06 /Kh 25 Consolidated net sales Financial overview (MSEK)
Telia, AB, IR, eng :06 /Kh 26 External net sales, BA Financial overview Change in % Mobile+45.7 International Carrier+9.6 Networks-2.0 Internet Services+24.6 Equity-25.8 Total for the Group+5.7 Q1 2001Q (MSEK)
Telia, AB, IR, eng :06 /Kh 27 Underlying EBITDA, BA Financial overview Q Q Change in % Mobile+34.2 International Carrier- Networks-3.1 Internet Services- Equity+61.9 Group-wide- Total for the Group +2.7 (MSEK)
Telia, AB, IR, eng :06 /Kh 28 Share of earnings in associated companies Financial overview MSEKQ1 2001Q Netia Holdings (Networks) Baltic region (Mobile/Networks) Unisource/AUCS (Networks) -491,0041,445 Comsource/Eircom (Networks) Telia Overseas (Equity) ,719 Eniro (Equity) Other associated companies Total ,197
Telia, AB, IR, eng :06 /Kh 29 Market value, associated companies Financial overview MSEKParticipationBookMarket Per 31 March 2001 in %valuevalue Eniro AB (Sweden) ,802 Scandinavia Online AB (Sweden) AS Eesti Telekom (Estonia) ,341 AB Lietuvos Telekomas (Lithuania) 30.02,5021,211 Netia Holdings S.A. (Poland) 48.12,4031,267 Infonet Services Corp. (USA) 20.12,5436,479 Eircom plc14.06,8846,777 Total15,67525,078 *) Incl. loans of MSEK 6,459 *)
Telia, AB, IR, eng :06 /Kh 30 Investments Financial overview MSEKQ1 2001Q Mobile5091,00126,017 International Carrier1, ,634 Networks1, ,421 Internet Services Equity5122,0157,185 Group-wide Total for the Group3,6594,64447,742
Telia, AB, IR, eng :06 /Kh 31 Financial position Financial overview 31 March31 Dec Net interest-bearing liability (MSEK)24,42520,235 Balance sheet total (MSEK)127,062122,715 Debt/equity ratio (multiple) Equity/assets ratio (%)
Telia, AB, IR, eng :06 /Kh 32 Financial overview Change in net borrowings Under- lying EBITDA Net invest- ments 31 March January 2001 Divesti- tures Tax Other 20, , ,348 3,663 24,425 (MSEK)
Telia, AB, IR, eng :06 /Kh 33 Financial overview Telia stock