Telia Company AB · OMXSTO:TELIA
Telia Company AB — TeliaSonera — Q2 2015 Earnings Presentation
13 slides from Telia Company AB's earnings presentation, July 2015
Slide 1: Q2 Interim Report April-June 2015: Summary
Q2 Interim Report April-June 2015 Johan Dennelind, President & CEO Summary Q2 2015 SERVICE REVENUE GROWTH Reported +5.6% Organic -1.3% * Reported +4.0% EBITDA* GROWTH Organic -4.0% FREE CASH FLOW SEK 6.3 billion +156% * Excluding non-recurring items 2 1
Slide 2: Strengthened competitive position in Norway
Strengthened competitive position in Norway • Mobile market share around 40 percent >90% 4G population • Superior 4G network position coverage in June • Organic service revenue growth 3 percent • Target 98 percent 4G population coverage by end 2016 3 Faster and better integration - raised synergy ta
Slide 3: Improved earnings trend in Sweden
Improved earnings trend in Sweden Service revenue growth* y-o-y Organic EBITDA** growth y-o-y Q1 15 Q2 15 B2C +2.6% Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 -5.1% B2B -9.6% -3.8% • Service revenues declined organically • Optimizing market investments behind improved by 1 percent, stable trend vs Q1 trend
Slide 4: Major efforts made in Nepal following the earthquake
Major efforts made in Nepal following the earthquake • Ncell provided customers with free services post the earthquake • Heroic efforts from Ncell employees to get network up and running - most part is now back in operation • TeliaSonera and Ncell have donated and committed funds to support the rebu
Slide 5: Executing on our strategic agenda
Executing on our strategic agenda ENHANCE THE CORE Develop the core CONNECTIVITY CONVERGENCE COMPETITIVE business in the Nordics & Baltics #1 Take Eurasia to the next level OPERATIONS EXPLORE OPPORTUNITIES CLOSE TO THE CORE IOT E-HEALTH MUSIC SECURITY FINANCIAL TV Invest in areas that complement and
Slide 6: Transformation pace beginning to pick up
Transformation pace beginning to pick up Investments and savings, SEK billion Area Status Targets 2017/2018 Fewer products and offerings 4% 80% Net savings run-rate to be reached 2017 Fewer IT systems 1% 50% 2.0 Share of services and sales online 24% >50% Fewer products and offerings 4% 80% Fewer IT
Slide 7: Summary Q2 2015
Summary Q2 2015 Apr-Jun 2015 Apr-Jun 2014 Change (%) Net sales (SEK million) 27,115 24,985 +8.5 Change local organic (%) +1.9 Service revenues (SEK million) 23,645 22,384 +5.6 Change local organic (%) -1.3 EBITDA* (SEK million) 9,190 8,836 +4.0 Change local organic (%) -4.0 EBITDA* Margin (%) 33.9 3
Slide 8: Continued high growth in equipment sales
Continued high growth in equipment sales Group net sales growth* impact Equipment sales growth** Sweden Europe +3.0% +1.9% 40% 20% +0.1% -0.5% -0.0% -0.2% -0.5% 0% -20% Net sales Billed Interconnect Other mobile Fixed service Other service Equipment Net sales -40% Q2 14 revenues revenues service rev
Slide 9: Investing in superior connectivity
Investing in superior connectivity CAPEX*, SEK million 4G population SDU fiber roll-out in coverage above 90% Sweden to increase Q2 14 Q2 15 in all Nordic countries 50% in 2015 4,596 1,577 1,410 903 >90% 50% Region Sweden Region Europe Region Eurasia Group • Higher CAPEX in line with invest-to-save
Slide 10: Minor change in net debt year on year
Minor change in net debt year on year Net debt change y-o-y 67.1 +13.0 +1.2 +0.0 68.5 • Net debt fairly stable despite +4.3 +18.2 increased CAPEX and M&A activities • Net Debt/EBITDA 1.91x -30.7 (1.90x end Q2 2014) -4.7 Q2 14 CF from Turkcell Cash M&A Dividend Minority FX & Q2 15 operating dividend
Slide 11: Q&A; Financial key ratios
Q&A 21 Financial key ratios Jun 30, 2015 Dec 31, 2014 Return on equity* 14.4 15.0 Return on capital employed* 11.5 12.2 Equity/assets ratio 39.0 38.0 Net debt/equity ratio 66.5 57.4 Net debt/EBITDA** ratio 1.91 1.68 Net debt/assets ratio 25.9 21.8 * Rolling 12 months ** Rolling 12 months, excluding
Slide 12: EPS impacted by lower contribution from associates
EPS impacted by lower contribution from associates Q2 Earnings per share 0.82 +0.08 +0.03 +0.01 0.75 -0.08 -0.03 -0.01 • Lower associated contribution -0.07 from MegaFon and Turkcell 23 Debt maturity schedule Debt Maturing next 12 months – 2015 and onwards SEK billion 6 5 4 3 2 1 0 Debt per Q2 2015
Slide 13: Dividend policy
Dividend policy • The company shall target a solid investment grade long-term credit rating (A- to BBB+) • TeliaSonera shall target to distribute an annual dividend of at least SEK 3 per share for the fiscal year 2015 25 Forward-looking statements Statements made in this document relating to future