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Telenor Group claims ‘solid operational results’ for 2021

2 Feb 2022

Telenor Group has published its financial results for the three- and twelve-month periods ended 31 December 2021, in which it claimed to have delivered ‘solid’ operational results despite the ongoing pandemic, thanks to ‘several years of modernisation and digitalisation initiatives’. The Norwegian telecoms giant reported total revenues of NOK110.2 billion (USD12.4 billion) for its most recent fiscal year, down from NOK115.8 billion in 2020, while Q4 2021 revenue declined to NOK28.2 billion, from NOK29.3 billion in the corresponding period a year earlier. Subscription and traffic revenues were also down on a reported basis, falling to NOK81.8 billion in FY21 (FY20: NOK87.2 billion) and NOK20.2 billion in 4Q21 (4Q20: NOK21.5 billion), respectively, largely driven by negative currency effects. However, it said that on an organic basis subscription and traffic revenues remained stable for both the fourth quarter and the full year.

In terms of other key financial metrics, Telenor Group recorded an EBITDA before other income and other expenses of NOK11.7 billion in 4Q21, down from NOK12.6 billion in 4Q20; on an organic basis fourth-quarter EBITDA fell by 1%. Meanwhile, full year reported EBITDA was NOK49.2 billion in FY21, down from NOK52.4 billion in FY20, with negative currency effects again cited as the driver. On an organic basis EBITDA was down only 0.2% year-on-year, though, with it noted that the negative effect from higher energy prices had been fully offset by operating expenses reductions within other areas.

Telenor Group’s net income totalled NOK587 million in 4Q21, representing a sizeable decline from the NOK7.7 million reported for the same period of 2020; this drop was attributed primarily to a NOK3.3 billion gain made on the sale of Tapad and Telenor headquarters in 4Q20, as well as NOK800 million fine in Norway levied in 4Q21. Full year net income stood at NOK1.5 billion, down from NOK17.3 billion, with Telenor Group saying that profit from continuing operations excluding non-controlling interests had decreased by NOK5.9 billion, mainly driven by gains on disposals made in 2020 as well as negative currency effects on operating profit and net financial items. Further, it was noted that profit from discontinued operations fell by NOK9.9 billion in FY21, mainly due to impairment of Telenor Myanmar of NOK6.5 billion in 1Q21, lower contribution from the underlying results of Telenor Myanmar, and the gain on disposal of Canal Digital of NOK1.7 billion in 2020.

With regards to operational indicators, Telenor Group reported a group mobile subscription base totalling 172.2 million as of 31 December 2021, up from 165.5 million a year earlier. It noted that in Asia, Telenor Pakistan and Thailand’s dtac continued to grow their subscriber bases in Q4 2021, adding 300,000 and 200,000 new subscriptions, respectively, while its Bangladeshi and Malaysian units both saw customer declines. In the Nordics, meanwhile, its Swedish subsidiary reported an improvement in its subscription base, which increased by 25,000 in 4Q21, although declines were recorded in Denmark and Finland, impacted by ‘the port-out of large public accounts’, while it also recorded a decline in subscriptions in its domestic territory.

Looking to the year ahead, Telenor Group CEO Sigve Brekke said: ‘Entering 2022, [Telenor Group] will maintain focus on returning to growth, the opportunities we see from also going beyond connectivity, creating leading operators through partnerships in Asia and further developing our infrastructure position in the Nordics. For the full year 2022 and excluding Digi in Malaysia, we expect low single digit growth in service revenues, EBITDA around 2021 level or slightly higher and capex to sales ratio of 16%-17%.’

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