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TeliaSonera results highlight Eurasia growth; outlook lifted

25 Oct 2010

Nordic telecoms group TeliaSonera’s third-quarter net revenues decreased by 1.1% year-on-year to SEK26.75 billion (USD4.04 billion), although EBITDA, excluding non-recurring items, increased marginally, by 0.1%to SEK9.78 billion. Operating income, excluding one-off items, increased by 1.9% y-o-y to SEK8.62 billion in the three months ended 30 September 2010, and net income attributable to owners of the parent company rose by 18.7% to SEK5.99 billion. Results were boosted by strong growth in its Eurasia emerging markets division as well as increased mobile data services usage and smartphone take-up in the Nordic region.

In TeliaSonera’s Mobility Services division, net sales increased 2.6% y-o-y in Q3 2010 to SEK12.96 billion, partly offset by a 9.4% drop in Broadband Services revenues to SEK9.77 billion. At the Eurasia arm, including markets such as Kazakhstan, Azerbaijan, Uzbekistan, Turkey and Georgia, turnover climbed 15.7% to SEK4.29 billion. Group-wide, the number of mobile, fixed line and internet subscriptions rose by 12.8 million from the end of the third quarter in 2009 to 156.6 million, including growth of 6.5 million in consolidated operations to reach a total of 53.2 million, and an increase of 6.3 million to 103.4 million in TeliaSonera’s associated companies. During the third quarter alone, total subscriptions increased by two million in the consolidated companies and by 2.2 million in the associated companies.

Commenting on the future of Broadband Services, the company said that ‘the ongoing transition from traditional fixed telephony services to rich content services such as IPTV and video on demand is gaining momentum. This strengthens our firm belief that our fixed network is a crucial and differentiating asset for the future. At the same time it poses a short term challenge as we upgrade ADSL to VDSL and provide more households and businesses with fibre connections. We believe we can manage this difficult transition while protecting healthy margins. We are also encouraged that we now have more than 350,000 fibre/LAN customers which give us an opportunity to sell more services to our existing customers.’

TeliaSonera raised its net sales and EBITDA outlook for 2010. It now expects full-year net sales growth, in local currencies and excluding acquisitions, in line with the 3.4% achieved in the first nine months of 2010. The group raised its core profit margin guidance, saying 2010 would top the 33.6% margin it achieved in 2009.

Sweden, Telia Company

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