Telekom Slovenije

Earnings Release • May 3, 2023

Category: Annual financial and audit reports

Published on: SEOnet

Published at:  28.04.2023 08:15

Published document ID: AR-35/23

AR-35/23

TELEKOM SLOVENIJE, d.d., Ljubljana

Audited annual report of the Telekom Slovenije Group and Telekom Slovenije, d.d. for 2022

Pursuant to the provisions of the Rules of the Ljubljana Stock Exchange and valid legislation, Telekom Slovenije, d.d., with its registered office at Cigaletova ulica 15, Ljubljana, hereby publishes the following announcement:

At its 12th ordinary session held on Wednesday, 26 April 2023, the Supervisory Board of Telekom Slovenije, d.d. approved the annual report of the Telekom Slovenije Group and Telekom Slovenije, d.d. for 2022.

Global markets experienced shortages of energy products, other commodities, semiconductors and equipment in 2022, and most notably a sharp increase in the associated prices. The Telekom Slovenije Group responded appropriately to the adverse conditions, as can be seen in achieved operating results.

The Telekom Slovenije Group generated EUR 652.1 million in sales revenue in 2022, an increase of one percent relative to the previous year, and EUR 659.0 million in operating revenues, which was likewise an increase of one percent relative to the previous year and at the planned level. Telekom Slovenije, d.d. recorded a 5% increase in revenues on the wholesale market, while revenues from financial services, eHealth, insurance and the ICT segment are also on the rise. The sales revenue generated by Avtenta, whose services support the digitalisation of companies, was up by 22% in 2022 relative to the previous year. Also up (by 7%) was the sales revenue generated by GVO, which strengthened its presence on the market, and recorded an increase in revenues from the management and maintenance of open broadband networks. IPKO generated sales revenue of EUR 79.0 million, an increase of 11% relative to 2021. Revenues from mobile services were up by 16%.

The earnings before interest, taxes, depreciation and amortisation (EBITDA) generated by the Telekom Slovenije Group in 2022 were 2% higher than planned. EBITDA at the Telekom Slovenije Group level was EUR 216.5 million. If energy prices had remained at the 2021 level, EBITDA would have been at the level recorded in 2021. EBITDA as a proportion of net sales revenue was 33.2%. Following the calculation of income tax (including deferred taxes), the Telekom Slovenije Group generated a net profit of EUR 37.5 million in 2022, which is at the level recorded in 2021 and 35% higher than planned. Earnings before interest and taxes (EBIT) amounted to EUR 50.4 million in 2022. EBIT adjusted for electricity costs would have been 7% higher in 2022 than in 2021.

With the aim of providing the most advanced services and comprehensive ICT solutions, the Group ensures the continuous development of the network and the most state-of-the-art technologies, and the creation of the best user experience at all touchpoints. We earmarked EUR 167.8 million for investments at the Telekom Slovenije Group level in 2022, with more than two-thirds of that amount going to the development of the network and solutions for residential and business users. In Slovenia, an additional 30,909 households were connected to Telekom Slovenije, d.d.’s fibre optic access network, bringing the total to more than 442,000 Slovenian households connected to the aforementioned network. Telekom Slovenije, d.d. covers more than 40% of the population with the 5G network and more than 97% of the population with the LTE/4G network. Telekom Slovenije, d.d.’s powerful fibre optic access network is used by all major domestic operators, while national roaming is possible in the Company’s mobile network.

Proposal on the use of distributable profit for 2022

The Management Board of Telekom Slovenije, d.d. in conjunction with the Company’s Supervisory Board drafted a proposal on the use of distributable profit for 2022. The Company’s General Meeting of Shareholders, which will be held on 16 June 2023, will be forwarded the proposal of the distributable profit for 2022 in the amount of EUR 40,292,646.55 remaining undistributed, which deviates from the established dividend policy in the past.

The reason for such a proposal lies in the fact that the Company benefited from the stated aid granted with the aim of alleviating high electricity prices in accordance with the Act on Aid to the Economy to Mitigate the Impact of the Energy Crisis (ZPGOPEK). The Act stipulates that the companies are not entitled to state aid if they pay out profit in 2023 or for the year 2023. Paying out profit would thus make Telekom Slovenije, d.d. liable for returning the state aid in the amount of EUR 3.8 million. At the General Meeting the shareholders may also make or adopt proposals on the use of distributable profit that differ from the one set out above.

Given the proposal of no dividends being paid out in 2023, the Management Board and the Supervisory Board will strive, depending of the business and financial circumstances, for the Company’s 2024 General Meeting to be forwarded a proposal to pay out the total distributable profit for 2022, which would be approximately EUR 6.0 per share.

This announcement will also be accessible on Telekom Slovenije’s website (www.telekom.si) for a period of no less than 10 years from the date of publication.

Management Board of Telekom Slovenije, d.d.

Date: 03.05.2023