Telia Company AB · OMXSTO:TELIA
Telia Company AB — TeliaSonera — Q3 2004 Earnings Presentation
29 slides from Telia Company AB's earnings presentation, Oct 28, 2004
Slide 1: Investor Presentation, London
Anders Igel President and CEO October 28, 2004 Investor Presentation, London
Slide 2: July-September 2004 Summary
July-September 2004 Summary • Good result • Proposal regarding shareholder return • Initiatives for the future prepared – Platform for Future Growth – Measures to keep profitability – Take advantage of Eastern opportunity October 28, 2004 Investor Presentation, London 2
Slide 3: July-September 2004 highlights
July-September 2004 highlights • High EBITDA margin 39.8% maintained (39.4) • Sales increased 3% • Strong customer growth Y-o-Y – 1 million new customers in Nordic and Baltic countries – 11 million new customers in Eurasia, Russia and Turkey • Market positions maintained • Successful acquisitions su
Slide 4: Outlook
Outlook • Long term view unchanged compared to previous quarter • For the TeliaSonera group, the fourth quarter of 2004 is expected to show the same trends as the comparative quarter last year in terms of profitability and CAPEX October 28, 2004 Investor Presentation, London 4
Slide 5: Shareholder return specified
Shareholder return specified • SEK 30 billion to shareholders during 2005-2007 in addition to ordinary dividends • The board has decided to recommend to the AGM in April 2005 a distribution of approx. SEK 10 billion • Repurchase of shares through a public offering with tradable rights will be propos
Slide 6: Performance during July-September 2004
Performance during July-September 2004 October 28, 2004 Investor Presentation, London
Slide 7: Market positions in Nordic home markets maintained
Market positions in Nordic home markets maintained • Maintained market positions Performance and sequential margin pick up Jul-Sep 2004 in Nordic markets Sweden Mobile, sales year-on-year -2% Fixed, sales year-on-year -3% • Usage increases but price EBITDA margin 42.5% reductions limit growth in Fin
Slide 8: Mobile growth continues in Baltic markets
Mobile growth continues in Baltic markets • Stable development in Sales growth Q3 2003-Q3 2004 Estonia • Strong mobile growth in Latvia Estonia1 Mobile 13% Fixed 3% • Strong mobile customer intake in Lithuania Latvia – Significantly lower price Mobile local currency 13% 16% levels affected net sales
Slide 9: Closing of Orange deal strengthens Nordic and Baltic leadership
Closing of Orange deal strengthens Nordic and Baltic leadership • From № 4 to № 2 in Denmark Denmark Mobile subs.1 • Possibility to become Danish TDC 1.6 million New Telia DK 1.1 million customers’ № 1 choice Sonofon 1.0 million • Critical mass in Denmark #1 • Large and tangible synergies #2 #1 #1 #
Slide 10: Turkcell – more customers and higher ARPU
Turkcell – more customers and higher ARPU • Customer growth and increased usage created strong growth • Stable pricing increased ARPU of USD 15.50 (14.39) Number of customers1 (million) Sales1, 2 (USD million) TeliaSonera Share of Net income 20.9 +30% 835 17.2 640 269 218 Q2 2003 Q3 2003 Q4 2003 Q1
Slide 11: 2.4 million new subscribers in MegaFon
2.4 million new subscribers in MegaFon • MegaFon took 25% of the total Russian customer increase during Q3 and increased its market share • The TeliaSonera share of net income increased 19% Number of customers (million) Sales (USD million) TeliaSonera Share of Net income 11.5 +74% 418 271 240 227 5.
Slide 12: High growth and improved margins in Eurasia – Fintur
High growth and improved margins in Eurasia – Fintur • Customer growth and increased ARPU pushed up sales by 54% (In local currency sales increased 67%) • Customer growth during Q3 was 458,000, Y-o-Y +1,300,000 Number of customers (million) Sales (USD million) EBITDA1 and CAPEX 1,153 1) Excl. non-re
Slide 13: Opportunities for the future
Opportunities for the future • Platform for Future Growth • Measures to keep profitability • Take advantage of Eastern opportunity October 28, 2004 Investor Presentation, London
Slide 14: Migration trend
Migration trend Mobile igr ation +8.6% in Q3 M TeliaSonera group Fixed -6.3% in Q3 TeliaSonera group Migr ation Internet +14.7% in Q3 Broadband +25.1% TeliaSonera group October 28, 2004 Investor Presentation, London 14
Slide 15: Take the lead in the migration
Take the lead in the migration October 28, 2004 Investor Presentation, London 15
Slide 16: TeliaSonera – Markets in different stages
TeliaSonera – Markets in different stages Transformation New High growth Mature growth markets markets Migration phase? Nordic Baltic Turkey Russia Eurasia October 28, 2004 Investor Presentation, London 16
Slide 17: TeliaSonera – Dual opportunities
TeliaSonera – Dual opportunities Nordic – Baltic Turkey – Russia – Eurasia 31 234 million million Inhabitants 36 million 22 million TeliaSonera customers Approaching 100% Penetration Still low Modest Sales growth High Stable Profitability Accelerating October 28, 2004 Investor Presentation, London 1
Slide 18: TeliaSonera – Dual opportunities
TeliaSonera – Dual opportunities Nordic – Baltic Turkey – Russia – Eurasia Inhabitants TeliaSonera customers Create Create growth growth Exploit Exploit growth growth Penetration Keep Keep profitability profitability Enhance Enhance value value Sales growth Profitability October 28, 2004 Investor Pr
Slide 19: The Nordic Baltic Opportunity
The Nordic Baltic Opportunity October 28, 2004 Investor Presentation, London
Slide 20: The Nordic Baltic Opportunity
The Nordic Baltic Opportunity Platform for Create growth future growth Competitive Keep profitability Cost Levels October 28, 2004 Investor Presentation, London 20
Slide 21: Platform for Future Growth – Focused Service Portfolio
Platform for Future Growth – Focused Service Portfolio Legacy Mobile Internet Managed Services Mobile voice Content Residential distribution broadband Mobile data Business IP Combinations October 28, 2004 Investor Presentation, London 21
Slide 22: Platform for future growth
Platform for future growth Enhanced growth opportunities a rs y e y 3 Customer Service Enhancement a tel x im pro Migration Strategies Fixed Æ IP and Mobility Ap Renewed offering and pricing strategies Focused Service Portfolio, based on simplicity 22 million Customer Base – Scale Advantage – Clear
Slide 23: Keep profitability
Keep profitability • The opportunities identified enables TeliaSonera to reduce costs to completely different levels than today • Growth initiatives will be accelerated and prioritized without losing focus on actions securing competitive cost levels October 28, 2004 Investor Presentation, London 23
Slide 24: Keep profitability
Keep profitability Competitive Cost Levels a rs Business culture programmes 3 ye ly a te Common tools and processes implementation xim p ro Ap Telecom and IT-systems restructuring Operational improvements (marketing, channels, network, order, delivery etc) Focused Service Portfolio OPEX: SEK 52 bill
Slide 25: The Eastern Opportunity
The Eastern Opportunity October 28, 2004 Investor Presentation, London
Slide 26: The Eastern opportunity
The Eastern opportunity Turkey Russia Eurasia Active Board Part of TeliaSonera process Closer alliance Increase ownership if possible October 28, 2004 Investor Presentation, London 26
Slide 27: Focus going forward
Focus going forward • Short term Platform for – Maintain or increase market shares future growth – Synergy realizations – Acquisitions within footprint Competitive • Medium term Cost Levels – Create Platform for Future Growth – Take measures to keep profitability – Take advantage of Eastern opportun
Slide 28: Forward-looking statements
Forward-looking statements Statements made in this document relating to future status or circumstances, including future performance and other trend projections are forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and
Slide 29: The Nordic and Baltic telecommunications leader
The Nordic and Baltic telecommunications leader October 28, 2004 Investor Presentation, London