Telia Company Ab · OMXSTO:TELIA
Telia Company Ab — Q3 2023 Earnings Presentation
27 slides from Telia Company Ab's earnings presentation, Oct 19, 2023
Slide 1: Telia Q3 2023
Telia Q3 2023 October 19, 2023
Slide 2: Telco growth accelerated further
Telco growth accelerated further Strong Q3 financial and operational performance across all Telco operations ‒ Service revenue growth accelerated further +3.9% Service revenue growth ‒ Mobile growth improved (+3.8%) as did fixed services (+3.7%) (Telco operations, LFL) ‒ Consumer growth was solid (+
Slide 3: Four key priorities to drive sustainable growth
Four key priorities to drive sustainable growth 1 2 3 4 Restore growth by Lead the build out of Transform to become Build the capabilities to inspiring our customers digital infrastructure that a more digital telco deliver sustainably connects everyone and responsibly 3
Slide 4: Telco operations
Overview Telco operations
Slide 5: Sweden financials
Sweden financials Service revenue Service revenue split Adj. EBITDA Reported currency, in SEK millions, like for like growth Reported currency, in SEK millions, like for like growth Reported currency, in SEK millions, like for like growth +1.2% -1.0% +0.4% +1.8% +2.2% +3.4% +1.0% +2.8% +4.1% +4.3% +
Slide 6: Sweden KPIs
Sweden KPIs Mobile postpaid subs. and ARPU Broadband subs. and ARPU TV subs. and ARPU Subscriptions ’000, ARPU in SEK Subscriptions ’000, ARPU in SEK Subscriptions ’000, ARPU in SEK 253 330 333 336 204 252 326 324 202 199 198 250 250 250 191 118 100 85 70 61 3,895 3,886 3,891 3,905 3,920 1,241 1,275
Slide 7: Finland
Finland Service revenue Adj. EBITDA Mobile postpaid subs. and ARPU Reported currency, in SEK millions, like for like growth Reported currency, in SEK millions, like for like growth Subscriptions ’000, ARPU in EUR +0.7% +2.2% +2.3% +2.3% +1.9% -7.3% -5.5% +1.2% +2.2% +10% 18.4 18.6 1,392 17.7 18.0 17
Slide 8: Norway
Norway Service revenue Adj. EBITDA Mobile postpaid subs. and ARPU Reported currency, in SEK millions, like for like growth Reported currency, in SEK millions, like for like growth Subscriptions ’000, ARPU in NOK +5.9% +3.2% +3.8% +5.4% +5.8% +4.5% +2.5% +2.7% +14% +11% 301 297 293 3,298 3,382 288 3,
Slide 9: Lithuania & Estonia
Lithuania & Estonia Lithuania Estonia Reported currency, in SEK millions, like for like growth Reported currency, in SEK millions, like for like growth +5.6% +7.1% +9.9% +6.5% +9.9% +0.5% +13% +13% +10% +19% +5.0% +5.1% +5.8% +8.3% +7.2% +4.4% +8.1% +10% +14% +15% 1,124 554 888 435 1,052 821 857 401
Slide 10: TV & Media
Overview TV & Media
Slide 11: TV & Media
TV & Media Service revenue Adj. EBITDA Direct OTT subs. and ARPU Reported currency, in SEK millions, like for like growth Reported currency, in SEK millions, like for like growth Subscriptions ’000, ARPU in SEK +0.2% -2.7% -2.4% -7.6% -8.6% 24% n/a n/a n/a -44% 188 186 173 178 158 2,564 2,201 234 15
Slide 12: Financials
Overview Financials
Slide 13: Service Revenue & EBITDA
Service Revenue & EBITDA Service revenue Adjusted EBITDA Like for like growth Like for like growth Continuing operations Continuing operations Telco operations 9.3% Telco operations 3.9% 7.6% 3.2% 4.7% 2.6% 2.4% 2.6% 2.3% 1.9% 1.9% 1.6% 1.0% 0.5% 1.2% 0.0% 0.7% -0.6% -0.8% -2.0% Q3 22 Q4 22 Q1 23 Q2
Slide 14: OPEX & CAPEX
OPEX & CAPEX OPEX excl. energy CAPEX excl. licenses Like for like growth Reported currency, in SEK billions -2.1% 4.8 3.5 3.5 3.7 2.9 Q3 22 Q4 22 Q1 23 Q2 23 Q3 23 Mobile NW Fixed NW Product & IT Other ‒ OPEX declined mainly driven by a group-wide proactive shift towards own ‒ Reduction of SEK 0.6bn
Slide 15: Cash Flow
Cash Flow Reported currency, in SEK billions Q3 23 Q3 22 Change ‒ EBITDA improved from strong Telco performance Adjusted EBITDA 8.5 7.7 0.7 ‒ Cash CAPEX declined as planned Restructuring and other adj. items -0.1 -0.2 0.0 ‒ Leasing increased by SEK 0.1bn driven mainly by inflation ‒ Interest costs u
Slide 16: Cash Flow trends
Cash Flow trends Operational free cash flow ‒ Strong EBITDA growth supported OFCF in Q3, with continued positive Reported currency, in SEK billions, illustrative Q4 development expected in Q4 Operational free cash flow ‒ OFCF generation for the full year to be H2 weighted and especially Q4 Structura
Slide 17: Net Debt & Leverage
Net Debt & Leverage Net debt and leverage ‒ Net debt decreased by SEK 2.0bn driven by OFCF generation partly Reported currency, in SEK billions and leverage ratio offset by dividend distribution ‒ Leverage declined to 2.53x, and is expected to come down further in Q4 2.66x 2.53x from improved cash f
Slide 18: Outlook
Overview Outlook
Slide 19: Outlook 2023 updated
Outlook 2023 updated Service revenue* Low single digit growth Adjusted EBITDA* Low single digit growth (Previously: Flat to low single digit growth) CAPEX excl. licenses and spectrum** ~ SEK 13.5bn (Previously: In the range of SEK 13-14bn) Structural part of Operational free cash flow ~ SEK 7.5bn (P
Slide 20: Delivering successfully on all our strategic priorities
Delivering successfully on all our strategic priorities Telco growth momentum built further, supported by pricing, solid Consumer 1 trends, a further acceleration in Enterprise and structural cost benefits Restore growth by inspiring our customers Digital infrastructure leadership built further with
Slide 21: Q&A
Overview Q&A
Slide 22: Thank you
Overview Thank you
Slide 23: Appendix
Overview Appendix
Slide 24: Sustainability overview and key highlights
Sustainability overview and key highlights Three impact areas Climate and Digital Privacy and in focus circularity inclusion security Net zero by 2040 2 million individuals reached Top tier positions/ Our CO2 emissions halved by 2030 through digital inclusion initiatives preferred supplier ambitions
Slide 25: Telia's climate commitments
Telia’s climate commitments 2022 2025 2030 2040 Achieve Net Zero by reducing value chain CO2e emissions (scope 1, 2 and 3) by 90%, in line with the new SBTi Net Zero Corporate Standard, and offset (neutralize) residual emissions* • Reduce CO2e emissions in the whole value chain (scope 1, 2 and 3) by
Slide 26: ESG awards and ratings
ESG awards and ratings MSCI ESG rating EcoVadis Sustainalytics “AAA” (highest) “Platinum supplier” rating 19.5 Low Risk, Industry rank 12 out of 228 CDP Climate Rating ISS ESG rating FTSE4Good A- -B (Prime status) (Included in FTSE4Good) 26
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