Slide 1: Third Quarter 2024
• Third Quarter 2024 October 22, 2024 Information Classification: Internal
Slide 2: Highlights
• 2 Highlights 3% organic growth in end-user service revenue • 2% organic growth in underlying EBITDAaL • Solid equity free cash flow. Leverage at 2.3x • Launched the first Disney+ bundle in Sweden • Ranked as one of Sweden's most gender-equal companies by Allbright in 2024 • After four years as CEO
Slide 3: Solid performance
• Solid performance 3 1) Organic growth rate • 2) Excluding spectrum and leases Sweden Consumer in Q3 • EUSR growth of 1% driven by Fixed broadband at 7% and Mobile postpaid at 3% • Strong ASPU growth in Fixed broadband and solid RGU intake in Mobile postpaid Sweden Business in Q3 • EUSR growth of 2
Slide 4: Sweden
• sweden Information Classification: Internal
Slide 5: Sweden Consumer: Solid value growth
• -1% Mobile postpaid RGUs Fixed broadband RGU & ASPU Thousand QoQ and YoY growth % Digital TV Cable & Fiber RGU & ASPU Thousand QoQ and YoY growth % ASPU growth YoY Fixed broadband RGUs Digital TV Cable & Fiber RGUs Sweden Consumer: Solid value growth Mobile postpaid RGU & ASPU Thousand QoQ and YoY
Slide 6: Sweden Consumer: Good EUSR growth in connectivity
• Mobile prepaid Fixed broadband EUSR SEK million, YoY growth % Digital TV EUSR SEK million, YoY growth % Mobile postpaid Fixed Broadband Digital TV Cable & Fiber DTT TV Sweden Consumer: Good EUSR growth in connectivity Mobile EUSR SEK million, YoY growth % Q3 highlights • Mobile end-user service re
Slide 7: Sweden Business: Continued topline growth
• Fixed Solutions Mobile Mobile ASPU YoY growth % End-user service revenue SEK million, YoY growth % Sweden Business: Continued topline growth Mobile RGU & net intake Thousand QoQ and YoY growth % Q3 highlights • End-user service revenue (EUSR) growth of 2% despite continued economic headwind • EUSR
Slide 8: Business Sweden financials: Continued EBITDAaL growth
• Consumer Underlying EBITDAaL & margin SEK million, YoY growth % Operating cash flow and cash conversion, LTM, SEK million Business Sweden financials: Continued EBITDAaL growth End-user service revenue SEK million, YoY growth % Q3 highlights • EUSR grew by 2% supported by both Business and Consumer
Slide 9: Baltics
• Baltics Information Classification: Internal
Slide 10: Baltics operational highlights: Strong overall performance
• Mobile RGUs Latvia – Mobile RGU & ASPU Thousand QoQ and YoY growth % ASPU growth YoY Baltics operational highlights: Strong overall performance Estonia – Mobile RGU & ASPU Thousand QoQ and YoY growth % Q3 highlights • The overall Baltic mobile postpaid customer base continued to increase driven by
Slide 11: Baltics financials: Sustained strong growth
• Estonia Underlying EBITDAaL & margin SEK million, YoY growth % Operating cash flow and cash conversion, LTM, SEK million Latvia Baltics financials: Sustained strong growth End-user service revenue SEK million, YoY growth % Lithuania Q3 highlights • Solid EUSR growth of 7% driven by both ASPU and p
Slide 12: Financial overview
• Financial overview Information Classification: Internal
Slide 13: Group results
Group results • Group results Comments • D&A decreased due to reduced regular depreciation and because the surplus value of the TDC acquisition has been fully amortised • Income tax increased mainly due to a pillar 2 top-up tax relating to Lithuania • 2 13 1 Information Classification: Internal
Slide 14: Group cash flow
Group cash flow • Group cash flow Comments • Capex increased due to timing of payments • Changes in working capital were mainly impacted by a decrease in liabilities following a temporary increase in the previous quarter • Taxes paid increased mainly as this quarter included approximately SEK 130 mi
Slide 15: Leverage at 2.3x
Leverage at 2.3x • Leverage at 2.3x Comments • Economic net debt decreased by SEK 1.1 billion compared to year-end 2023, driven by the cash generated in the business, exceeding the payout of the first tranche of the ordinary dividend • Leverage of 2.3x was below the lower end of the target range of
Slide 16: Strategy Execution Program (SEP) update
• • Radical improvements in customer experience and value will generate operational efficiency Strategy Execution Program (SEP) update Creating customer value in Q3 • Online channel delivered improved CX on iPhone Launch Day • Boxer TV services modernisation well underway • Launched the first Disney
Slide 17: Strategy Execution Program (SEP) update: OPEX reduction
• 17 • Radical improvements in customer experience and value will generate operational efficiency Strategy Execution Program (SEP) update Annualised run-rate • Q3 2024 Realised in • Q3 2024 225 55 Annualised run-rate target YE 2026 600 OPEX reduction • (SEK million) • - Q3 mainly driven by network o
Slide 18: Strategy Execution at full speed
• IT Migration CX & Go to Market 3rd Party Retail Own (Digital) Channels Volume Value Legacy platforms Digital capabilities 2020 2026 18 Strategy Execution at full speed Information Classification: Internal
Slide 19: Building Sustainable Consumer Growth
Building Sustainable Consumer Growth • Building Sustainable Consumer Growth Capitalising on our FMC Potential Balancing Value and Volume Growth Modernising our TV portfolio Tele2’s leading Consumer Brands position in Sweden is the result of our relentless Customer & Innovation focus 19 Information C
Slide 20: Our Consumer Journey
Our Consumer Journey • Our Consumer Journey 2021 Modernising Boxer TV Prepaid Registration Tele2 Rebrand Hybrid TV 2022 2023 2024 * For Tele2 and Boxer YTD ’24 vs ’21 2024 YTD 20 Information Classification: Internal
Slide 21: Our FMC Journey
Our FMC Journey • Our FMC Journey Churn reduction -30% Product hold of 3+ RGUs FMC share of sales of ~30% FMC penetration at ~26% FMC IT Stack Evolution FMC Proposition Development From Singleplay to Multiplay Shift from FMC cross brand to Tele2 main brand Key value pool is cross-selling to existing
Slide 22: Our Connectivity Journey
Our Connectivity Journey • Our Connectivity Journey Fostering continuous innovation to drive Value and Volume, alongside Annual Pricing adjustment to capture full value potential 22 2024 Handset portfolio New WiFi 6 router 2023 Postpaid Broadband 2022 5G Unlimited portfolio SIMO binding Connection g
Slide 23: Our TV Portfolio Journey
Our TV Portfolio Journey • Our TV Portfolio Journey Serving Shifting Entertainment Demand Key TV Innovation Steps Aggregator platform evolution * Ungdomsbarometern ’Rörligt Innehåll’ 2024 ** Set-Top Box Hybrid linear and streaming Traditional linear 2 20 STB’s TV Portfolio Modernisation Customer Upg
Slide 24: Consumer strategy: preferred brands, value-led connectivity, personalised CX
• Preferred Brands Value Led Connectivity Personalised CX Efficient GTM* Sustainability to Consumer Increased household penetration • Full multiplay and loyalty inclusion • Digital FMC customer journey Brand innovation to continue • Tele2 leading FMC household brand • Comviq leading Mobile user bran
Slide 25: Financial outlook (unchanged)
Financial outlook (unchanged) • Financial outlook (unchanged) Underlying EBITDAaL1 End-user service revenue1 1-3% 3-4% Capex to sales2 13-14% 25 2024 guidance Mid-term outlook Low to mid- single-digit Mid-single-digit 10-12% 1) Organic growth rate • 2) Excluding spectrum and leases Capex to sales of
Slide 26: Enabling a society of unlimited possibilities
• Enabling a society of unlimited possibilities Each era brings its own limitations. Breaking them means breaking new ground. We have always challenged limitations to realize new possibilities for our customers and society at large. • Today, we are deeply connected to the digital lifestyle of societ