Tele2 says global recession affected 1Q results

22 Apr 2009

Swedish mobile, fixed line and broadband group Tele2 has reported that its consolidated EBITDA rose by 34% year-on-year in the first quarter of 2009 to SEK2.2 billion (USD256 million) on revenues that grew 6% to SEK10.1 billion. In a statement, Tele2 said that ‘despite a difficult economic environment, the company has been able to improve profitability through cost control and improved efficiency,’ although group net profit was reported to have fallen from SEK750 million in 1Q 2008 to SEK648 million in the three months ended 31 March 2009. Tele2, with subsidiaries in Sweden, Norway, Russia, Croatia, the Baltics, Netherlands, Germany, Austria and France, committed CAPEX of SEK1.2 billion in the most recent quarter, up from SEK837 million a year earlier, mainly driven by expansion in Russia. Total mobile customers at the end of March reached 19.64 million, up by 2.2 million year-on-year, fixed broadband subscribers saw a net increase of just 7,000 to 1.27 million whilst the group’s fixed telephony user base shrank by 912,000 in twelve months to 3.56 million.

Tele2 CEO Harri Koponen told Reuters the global economic outlook was uncertain: ‘Right now we see minor effects but we do not know how big they will be in the quarters to come.’ The operator is forecast to book EBITDA of SEK8.7 billion in full-year 2009, up from SEK8.2 billion in 2008, according to a Reuters poll of 15 analysts. CAPEX is expected to be SEK4.7 billion-SEK4.9 billion against its forecast in its 4Q 2008 report of SEK4.5 billion-SEK4.7 billion. Koponen said the expected rise in CAPEX was mainly due to currency effects and not bigger spending plans. Tele2 hopes to launch GSM services in twelve out of 17 newly licensed Russian regions in 2009, whilst in Sweden the company recently announced a joint agreement with Telenor to roll out a 4G mobile network.

Russia, Sweden, Tele2, Tele2 Russia