Stockholm-based multinational telecoms operator TeliaSonera has posted its financial results for the three months ended 31 March 2012, in which it recorded a 3.5% year-on-year increase in net revenues to SEK25.693 billion (USD3.799 billion). The sales total represents aggregate growth across the group’s consolidated subsidiaries and associates in Azerbaijan, Denmark, Estonia, Finland, Georgia, Kazakhstan, Latvia, Lithuania, Moldova, Nepal, Norway, Russia, Spain, Sweden, Tajikistan, Turkey and Uzbekistan. However, operating income (EBIT) for the first quarter, excluding non-recurring items, decreased by 8.5% year-on-year to SEK6.641 billion (compared to SEK7.258 billion in Q1 2011), driven partly by EBIT at associated companies falling 36.2% to SEK1.033 billion. The decline in profitability is blamed on pricing pressure and tough competition across many markets. EBITDA for the group dropped to SEK8.824 billion in January-March 2012, down by 0.7% compared to a year earlier, while net income attributable to owners of the parent company decreased by 15.9% over the same period to SEK3.908 billion.
During the first quarter of 2012 TeliaSonera’s number of mobile, broadband, fixed line and pay-TV subscribers increased by 1.2 million year-on-year in the consolidated companies and by 1.1 million in the associated companies. The total number of subscriptions reached 172.4 million at the end of March. Growth segments which the company drew attention to included its fibre-optic broadband offering in Sweden, for which it saw ‘strong customer demand’, while amongst highlights of its Eurasia division it flagged up growth at Ncell of Nepal, which has passed seven million subscriptions since its acquisition by the Nordic group in 2008. Earlier this month TeliaSonera increased its ownership stake in Ncell whilst divesting a minority stake in Cambodia’s Smart Mobile, in line with a strategy to strengthen core majority holdings and exit non-core minority interests.
TeliaSonera also indicated that a shake-up was afoot in its second largest market by sales, Finland, where it aims to arrest a persistent negative trend and regain lost market share. In order to ‘sharpen’ its business the company announced the appointment of a new CEO in Finland, Robert Andersson. Elsewhere, the group has made recent moves towards a ‘new sustainable business model,’ by introducing tiered data price plans and lower costs for data roaming, and announcing the imminent introduction of mobile VoIP calling on a charged basis. The paid-for mobile VoIP model is set for launch by TeliaSonera’s Spanish unit Yoigo within a month, while it plans to expand the availability to new mobile subscribers in Sweden over this summer.
Regarding the uncertainty over TeliaSonera’s ownership status at Russian mobile operator MegaFon, it confirmed that discussions are ongoing with the two other shareholders, AF Telecom and Altimo, regarding future ownership and governance of the company. In recent interviews, the Swedish group’s CEO Lars Nyberg has said that the long drawn-out ownership conflicts in Russia and at Turkey’s Turkcell mean that he will not consider expanding TeliaSonera into any new regions in the foreseeable future.