Quarterly Report • Oct 21, 2022
Quarterly Report
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| SEK in millions, except key ratios, per share data and changes |
Jul-Sep 2022 |
Jul-Sep 2021 |
Chg % |
Jan-Sep 2022 |
Jan-Sep 2021 |
Chg % |
|---|---|---|---|---|---|---|
| Net sales | 22,456 | 21,271 | 5.6 | 66,566 | 64,962 | 2.5 |
| Change (%) like for like1,3 | 2.7 | 2.3 | ||||
| of which service revenues (external) 1 | 19,028 | 18,130 | 5.0 | 56,952 | 55,759 | 2.1 |
| change (%) like for like1,3 | 2.3 | 2.6 | ||||
| Adjusted² EBITDA1 | 8,070 | 7,738 | 4.3 | 22,954 | 22,571 | 1.7 |
| change (%) like for like1,3 | 1.0 | 0.7 | ||||
| Margin (%) | 35.9 | 36.4 | 34.5 | 34.7 | ||
| Adjusted² operating income1 | 3,387 | 2,896 | 17.0 | 9,010 | 7,787 | 15.7 |
| Operating income | 3,188 | 2,634 | 21.0 | 8,457 | 13,460 | -37.2 |
| Income after financial items | 2,404 | 1,957 | 22.9 | 5,932 | 11,417 | -48.0 |
| Total net income | 1,883 | 1,622 | 16.1 | 4,653 | 10,651 | -56.3 |
| EPS total (SEK) | 0.42 | 0.39 | 10.2 | 1.02 | 2.58 | -60.3 |
| Operational free cash flow1 | 2,052 | 2,937 | -30.1 | 5,342 | 9,031 | -40.8 |
| CAPEX excluding fees for licenses, spectrum and | ||||||
| right-of-use assets1 | 3,670 | 3,388 | 8.3 | 10,937 | 9,941 | 10.0 |
1) See Note 15 Alternative Performance Measures and/or section Definitions. 2) Adjustment items, see Note 2. 3) Like for like excludes exchange rate effects and is based on the current group structure, i.e. including the impact of any acquired operations and excluding the impact of any disposed operations, both in the current and in the comparable period.
"Telia's third quarter results show continued commercial momentum with service revenue growing 2.3% and all our units delivering positive service revenue growth for the first time in several years. Macroeconomic headwinds, however, strengthened from a breeze to a mild storm during the summer, with sharply higher energy prices and interest rates. In the quarter we were able to mitigate some of these headwinds and our resulting financial performance was positive, with cost efficiencies continuing and EBITDA growth of 1.0%. Had energy costs not increased, EBITDA would have grown by 4.9%, in line with our original plan for the second half of this year. However, while we see underlying progress towards our short and midterm goals, near-term energy prices and interest rates are having implications for our outlook, as I will explain later.
Growth momentum continues to be driven by a relentless focus on the execution of the strategy we set out upon early last year to create a Better Telia. Within Inspiring customers, our most trusted network leadership position enables us to sustain a premium position and is fundamental in supporting the many pricing activities we are taking to offset inflationary pressure. The role of our services at enabling sustainable innovation and digitalization is also increasingly evident, and we are particularly proud to enter into a long-term partnership with the Swedish electricity distribution company, Ellevio, to deliver and manage the data network infrastructure for around 8,000 power substations, enabling a better, smarter, more environmental and more cost-efficient grid for Sweden.
In Connecting everyone, roll-out of 5G accelerated, and we now reach 63% of the Nordic and Baltic population, up from 49% in June. In Lithuania, multi-year preparations enabled Telia to switch on 700MHz and 3.6GHz bands immediately after acquiring them, making Telia's 5G services uniquely accessible to 80% of the Lithuanian population overnight. And in the Nordics, Telia Norway and Telia Sweden remain market leaders with 78% and 40% population coverage, respectively.
We continue Transforming to digital towards a simpler, faster, more data driven organization better at serving our customers, while operating with a structurally lower cost base. Excluding the energy impacts, operational expenses declined by around SEK 100 million, or 2%, in the quarter keeping us on track towards our SEK 2 billion savings ambition by end 2023, despite non-energy inflationary pressure. In the quarter, it was mainly headcount reductions in Sweden, Finland and Norway that contributed. At the same time, legacy decommissioning and the transition to common, scalable products continued. We decommissioned another 10 IT systems, almost half of new products were launched on common platforms, 35% of legacy products have now been decommissioned, and a reduction in manual interactions in our contact centres continued, with 30% fewer customer calls in Sweden than in the same period last year.
Delivering sustainably and building the execution muscle to do so, was a strategic choice we made when we embarked on our journey to create a Better Telia, and in this challenging economic climate it could not be a more important strategic imperative.
Structural cost take out is ongoing and we are creating a more systematic approach to pricing, for example we are step-bystep introducing CPI-linked pricing for enterprise customers throughout our footprint and adopting a more comprehensive approach to customer value management by systematically moving consumers to services that are richer in quality, content, and price. In any one quarter these structural measures will not fully offset the sudden doubling of energy costs that we saw this quarter, despite having hedged a large part (100% from sustainable resources), but over time their impact will create a stronger foundation that will enable improved operating leverage, and continued scope for both investment and a growing dividend capacity. Our balance sheet remains solid and is well within its target range, enabling our buy-back program which has so far reduced the number of outstanding shares by around 2.4% by the end of the quarter. Further on Delivering sustainably, we are proud to have been awarded the Platinum EcoVadis medal for strong sustainability management through our policies, actions, and results, putting Telia among the top 1% of 75,000 companies assessed worldwide.
Moving to our business units, Telia Sweden again reported growth in both revenue and EBITDA, despite continued legacy headwinds. Service revenue growth was sustained at around 2% in postpaid mobile, 4% in fixed broadband and 15% in TV. The TV offering was strengthened with the addition of streaming rights for the Swedish football league Allsvenskan, helping us prepare for the expiration of the Viaplay agreement at the end of September, which was admittedly unfortunate for our customers. Telia's TV offering remains strong and includes premium sports rights such as Swedish ice hockey and Swedish football, Italian and Spanish football and UEFA Champions League.
Telia Finland reported a solid improvement in the mobile segment with revenue growth accelerating to 3.5% in the quarter with good momentum in both the Consumer and Enterprise segments. The Fixed segment was more challenging due to an accelerating migration away from copper and high margin datacom services, but overall service revenue growth was positive at 0.7% for the quarter. Transformation cost efficiencies continued to materialize; however Finland was particularly hard hit by energy prices that were 3x higher than the same period last year, leading to a 7.3% EBITDA decline in the quarter.
Telia Norway's momentum continued with 5.9% service revenue growth driven equally by the consumer and enterprise segments, supported by active pricing initiatives within broadband and TV. EBITDA growth accelerated to 4.5%, despite energy headwinds, as a result of broad-based market share gains and the aforementioned pricing initiatives.
In Lithuania, Telia took a clear lead on 5G and is already seeing strong initial demand, with a notable 5G price premium similar to that seen in Finland. Telia was also recognized as Lithuania's 4th most loved brand in the Baltic Brands Ranking, strengthening our quality position and an important enabler to further pricing initiatives. Service revenue growth of 5.6% did not convert into EBITDA growth this quarter due to energy costs. The energy hedging market is much less developed in the Baltics than the Nordics hence the disproportionate impact for our Lithuanian business this quarter. Telia Estonia is also maintaining its network quality and 5G leadership position, and grew both service revenue and EBITDA, by 5.0% and 4.4%, respectively in the quarter. For Telia Denmark, service revenue growth was modest, but transformation of the business continues and the move towards a leaner more agile Danish mobile player enabled EBITDA to grow by 8.1%, despite extreme energy headwinds.
TV and Media reported another quarter of record advertising revenues, up 5.9%. EBITDA increased by 24% driven by higher advertising revenues and lower content costs. After the end of the quarter, we announced that we will consolidate all linear and streaming content together under TV4 and MTV to simplify our organization set-up and offer our customers complete viewing flexibility across one common platform – TV4 in Sweden and MTV in Finland. As a result, C More premium content will ultimately be transferred into TV4 and MTV, enabling a more focused slate of Nordic content on fewer platforms in the future.
As I said last quarter, it has been decades since the world last saw the macro-economic conditions of today. Having seen energy and interest rates increase sharply in the quarter, we are being challenged more than we predicted only three months ago. As we look into the balance of this year and next, our original revenue, cost transformation and CAPEX efficiency plans are delivering, and the additional measures we are now taking in both pricing and cost take-out will build further resilience. However, even with hedging, the current energy prices cause significant short-term cost increases and we are now adjusting down our EBITDA growth outlook for 2022 and 2023. The energy cost increase for the full year 2022 is estimated to be around SEK 900 million, which is SEK 600 million higher than we expected only 3 months ago.
This, and the higher interest rates, is now reflected in our expectations for operational free cash flow for 2022, which is estimated to be below the minimum dividend level. With the current macro-outlook uncertainty we will wait until we report our full-year results in January before we comment on 2023 cash flow.
While macro factors are outside the company's control, the business is showing its resilience, as is evident in our third quarter results, and we will not stop at taking additional measures when the environment demands this. However, thanks to the choices we have made these past two years on capital allocation, on a more focused Nordic/Baltic portfolio, in the strengthening of our balance sheet and in building the foundations for a return to sustainable growth, I am confident that if we remain focused on the execution of our strategy, at a more accelerated pace, we will be an even better Telia when the macro-economic headwinds subside. In these times, I could not be more grateful to the highly engaged Telia team who remain focused on reinventing a Better Telia for the benefit of all our stakeholders, today, tomorrow, and far into the future."
Allison Kirkby President & CEO
In CEO comment, all growth rates disclosed are based on the "like for like" definition and EBITDA refers to adjusted EBITDA, unless otherwise stated. See definitions for more information.
Service revenues, like for like, are estimated to grow by low single digit (unchanged).
Adjusted EBITDA, like for like, is estimated to be similar to last year, and excluding energy cost increases, is estimated to grow by low single digit. (Previously: Adjusted EBITDA, like for like, is estimated to grow by low single digit).
Cash CAPEX, excluding fees for licenses and spectrum, is estimated to be in the range of SEK 14.0-15.0 billion (unchanged).
Service revenues, like for like, are estimated to grow by low single digit (unchanged).
Adjusted EBITDA, like for like, excluding energy cost increases, is estimated to grow by low to mid-single digit. (Previously: Adjusted EBITDA, like for like, is estimated to grow by low to mid-single digit).
Cash CAPEX, excluding fees for licenses and spectrum, is estimated to return to around 15% of net sales by 2023 (unchanged).
Telia Company targets a leverage corresponding to Net debt/adjusted EBITDA in the range of 2.0-2.5x and a solid investment grade of A- to BBB+.
Telia Company intends to follow a progressive dividend policy, with a floor of SEK 2.00 per share and an ambition for low to mid-single digit percentage growth.
For 2022, both the operational free cash flow and the structural part1 of operational free cash flow are expected to be below the minimum dividend commitment of SEK 7.9 billion. An outlook for 2023 will be provided in connection with the year-end report January-December 2022. (Previously: The structural part1 of operational free cash flow is expected to cover the minimum level of dividend from 2022. The operational free cash flow is expected to cover the minimum level throughout the 2021-2023 period).
For 2021, the Annual General Meeting (AGM) decided on an ordinary dividend of SEK 2.05 per share (2.00), totaling SEK 8.4 billion (8.2). The dividend will be split and distributed into two tranches of SEK 1.00 per share and SEK 1.05 per share, respectively.
The Annual General Meeting (AGM) decided that the first distribution of the dividend was to be distributed by Euroclear Sweden on April 13, 2022.
The Annual General Meeting (AGM) decided that the final day for trading in shares entitling shareholders to dividend be set for October 25, 2022. The record date at Euroclear Sweden for the right to receive dividend will be October 27, 2022. The dividend is expected to be distributed by Euroclear Sweden on November 1, 2022.
The Board of Directors announced, in connection with Telia Company's interim report January-March 2022, its intention to transfer the net proceeds from the Swedish tower transaction to the shareholders, by means of share buy-backs or an extraordinary dividend.
The Swedish tower transaction was completed on June 1, 2022, and on the same date it was announced that the Board of Directors had decided to initiate a share buy-back program for a total amount of SEK 5.4 billion corresponding to the transaction proceeds less transaction costs.
The buy-back program is being carried out in accordance with the Market Abuse Regulation (EU) No 596/2014 ("MAR") and the Commission Delegated Regulation (EU) No 2016/1052 (the "Safe Harbour Regulation"). The buy-back program is managed by Goldman Sachs Bank Europe SE that makes its trading decisions regarding the timing of the buy-backs of Telia Company's shares independently of Telia Company. See Note 6.
1) Telia Company consider the structural part of Operational free cash flow to be Operational free cash flow less contribution from change in working capital.
Net sales increased 5.6% to SEK 22,456 million (21,271) and like for like, net sales increased by 2.7%.
Service revenues increased 5.0% to SEK 19,028 million (18,130). Like for like, service revenues increased 2.3% driven by a positive development for all units.
Adjusted EBITDA increased 4.3% to SEK 8,070 million (7,738) and the adjusted EBITDA margin decreased to 35.9% (36.4). Like for like, adjusted EBITDA increased 1.0% driven primarily by positive development in Norway, Sweden as well as for the TV and Media unit. The growth was achieved despite around SEK 300 million in negative impact from increased energy expenses.
Adjustment items affecting operating income amounted to SEK -199 million (-262).
Adjusted operating income increased to SEK 3,387 million (2,896).
Financial items totaled SEK -784 million (-677) of which SEK -757 million (-656) related to net interest expenses.
Income taxes amounted to SEK -521 million (-335). The effective tax rate was 21.7% (17.1).
Total net income amounted to SEK 1,883 million (1,622).
Other comprehensive income decreased to SEK -335 million (575), mainly related to revaluation of defined benefit pension plans.
Cash flow from operating activities decreased to SEK 6,151 million (6,598) mainly due to working capital.
Free cash flow decreased to 2,478 million (3,457) mainly due to working capital and increased cash CAPEX.
Operational free cash flow, from continuing operations, decreased to SEK 2,052 million (2,937) mainly due to working capital and increased cash CAPEX.
Cash flow from investing activities amounted to SEK -331 million (-4,781). 2022 was mainly impacted by net divestments of short-term investments.
Cash flow from financing activities decreased to SEK -7,301 million (-906) mainly due to repurchase of treasury shares, settlements of collaterals for derivatives and net repayments of long-term borrowings.
CAPEX excluding right-of-use assets, decreased to SEK 4,042 million (4,391). CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased to SEK 3,670 million (3,388). Cash CAPEX increased to SEK 3,673 million (3,141).
Net debt was SEK 62,507 million at the end of the third quarter (60,165 at the end of the second quarter of 2022). The net debt/adjusted EBITDA ratio was 2.07x.
For information on impact from the war in Ukraine, see "Review of the Group, nine months 2022".
Net sales increased 2.5% to SEK 66,566 million (64,962) and like for like, net sales increased by 2.3%.
Service revenues increased 2.1% to SEK 56,952 million (55,759). Like for like, service revenues increased 2.6% driven by positive development across all units.
Adjusted EBITDA increased 1.7% to SEK 22,954 million (22,571) and the adjusted EBITDA margin decreased slightly to 34.5% (34.7). Like for like, adjusted EBITDA increased 0.7% as the positive development seen in most markets to a large extent was offset mainly by lower adjusted EBITDA for the TV and Media unit. The growth was achieved despite around SEK 500 million in negative impact from increased energy expenses.
Adjustment items affecting operating income amounted to SEK -553 million (5,673). 2021 was mainly impacted by a capital gain from the disposal of Telia Carrier.
Adjusted operating income increased to SEK 9,010 million (7,787).
Financial items totaled SEK -2,525 million (-2,043) of which SEK -2,126 million (-2,025) related to net interest expenses. 2022 was impacted by higher costs mainly related to negative market value changes.
Income taxes amounted to SEK -1,279 million (-941). The effective tax rate was 21.6% (8.2). The effective tax rate the corresponding period last year was mainly impacted by a tax-exempt capital gain from the disposal of Telia Carrier.
Total net income amounted to SEK 4,653 million (10,651). 2021 was impacted by a capital gain from the disposal of Telia Carrier.
Other comprehensive income increased to SEK 8,445 million (5,762), mainly related to higher revaluations of defined benefit pension plans driven by increased discount rates which was partly offset by lower return on plan assets. The increase in other comprehensive income from defined benefit pension plans was partly offset by lower exchange rate effects, mainly related to EUR.
Cash flow from operating activities decreased to SEK 17,694 million (20,239) mainly due to working capital.
Free cash flow decreased to 7,137 million (10,074) mainly due to working capital and increased cash CAPEX.
Operational free cash flow, from continuing operations, decreased to SEK 5,342 million (9,031) mainly due to working capital and increased cash CAPEX.
Cash flow from investing activities amounted to SEK -6,822 million (-6,178).
Cash flow from financing activities decreased to SEK -15,685 million (-8,574) mainly due to net repayments of borrowings, settlements of collaterals for derivatives and repurchase of treasury shares, partly offset by the partial disposal of the tower business in Sweden.
CAPEX excluding right-of-use assets, decreased to SEK 11,480 million (12,066). CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased to SEK 10,937 million (9,941). Cash CAPEX increased to SEK 10,557 million (10,165).
Goodwill and other intangible assets increased to SEK 92,793 million (89,943) mainly due to foreign exchange rate effects.
Investments in associated companies and joint ventures, pension obligation assets and other non-current assets increased to SEK 11,353 million (4,749) mainly due to positive remeasurements of defined benefit pension plans.
Short-term interest-bearing receivables increased to SEK 11,266 million (8,841), driven by collaterals for derivatives due to market value changes and a reclassification from Long-term interestbearing receivables, partly offset by net divestments of investment bonds.
Long-term borrowings decreased to SEK 90,900 million (91,637) driven by a decrease in bonds, including reclassification to short-term borrowings, partly offset by an increase in derivates.
Deferred tax liabilities increased to SEK 11,518 million (10,185) mainly due to increase in deferred tax liability relating to pension obligation assets.
Provisions for pensions and other long-term provisions decreased to SEK 4,893 million (7,001) mainly due to remeasurements of defined benefit pension plans.
Short-term borrowings decreased to SEK 8,194 million (10,017) mainly due to matured bonds partly offset by reclassification from long-term borrowings.
Trade payables and other current liabilities, current tax payables and short-term provisions increased to SEK 39,427 million (32,729) mainly due to the unpaid dividend liability.
On February 24, 2022, Russian military forces launched a military action against Ukraine. Telia Company's operational exposure to the war in Ukraine including the imposed sanctions is deemed limited. However, the war has resulted in higher prices and increased volatility in the energy market and an overall deteriorated macroeconomic environment, which is likely to continue, and the energy prices are expected to remain at a high level during 2022. The group's energy costs for the first nine months 2022 are almost SEK 0.5 billion higher and we foresee an energy cost increase of around SEK 0.9 billion for 2022 on a like for like basis.
The war in Ukraine has not had any significant impact on Telia Company's expected credit losses. Telia Company's financial risk management is in all material aspects unchanged, but with additional focus to maintain a continued strong liquidity position. Debt capital markets remains open to Telia Company and the main funding need 12 months ahead has been executed. The increase in interest rates, which is partly related to the Ukraine war, has had a negative impact on the market value of Telia Company's investment bonds, resulting in a limited negative effect on the finance net in the first nine months of 2022. See also section "Risks and uncertainties".
– On October 13, 2022, Telia Company announced that Mathias Berg, currently VP, Head of Advertising Nordic and Deputy CEO TV4 Media, will join Telia Company's Group Executive Management team as SVP, Head of TV and Media, succeeding Casten Almqvist, who will leave Telia Company on December 1, 2022. In connection to this, plans to simplify the TV and Media organization and a consolidation of linear and streaming content under TV4 and MTV, were also communicated.
| SEK in millions, except margins, | Jul-Sep | Jul-Sep | Chg | Jan-Sep | Jan-Sep | Chg |
|---|---|---|---|---|---|---|
| operational data and changes | 2022 | 2021 | % | 2022 | 2021 | % |
| Net sales | 8,698 | 8,424 | 3.3 | 25,887 | 25,317 | 2.3 |
| Change (%) like for like | 3.3 | 2.3 | ||||
| of which service revenues (external) | 7,429 | 7,337 | 1.2 | 22,255 | 21,905 | 1.6 |
| change (%) like for like | 1.2 | 1.4 | ||||
| Adjusted EBITDA | 3,394 | 3,353 | 1.2 | 10,089 | 9,818 | 2.8 |
| Margin (%) | 39.0 | 39.8 | 39.0 | 38.8 | ||
| change (%) like for like | 1.2 | 2.8 | ||||
| Adjusted operating income | 1,669 | 1,494 | 11.7 | 4,984 | 4,160 | 19.8 |
| Operating income | 1,647 | 1,411 | 16.7 | 4,886 | 3,951 | 23.7 |
| CAPEX excluding fees for licenses, spectrum and right-of-use assets |
773 | 683 | 13.3 | 2,410 | 1,969 | 22.4 |
| Subscriptions, (thousands) | ||||||
| Mobile | 7,955 | 6,689 | 18.9 | 7,955 | 6,689 | 18.9 |
| of which machine-to-machine (postpaid) | 3,166 | 1,833 | 72.7 | 3,166 | 1,833 | 72.7 |
| Fixed telephony | 426 | 541 | -21.3 | 426 | 541 | -21.3 |
| Broadband | 1,238 | 1,244 | -0.5 | 1,238 | 1,244 | -0.5 |
| TV | 1,044 | 975 | 7.1 | 1,044 | 975 | 7.1 |
| Employees | 4,135 | 4,456 | -7.2 | 4,135 | 4,456 | -7.2 |
Net sales increased 3.3% to SEK 8,698 million (8,424) and like for like, net sales increased 3.3% driven by both service revenue growth and increased sales of equipment.
Service revenues, like for like, increased 1.2% as mobile and fixed service revenues increased 2.3% and 0.8%, respectively. For mobile service revenues the increase was primarily due to a positive ARPU development. For fixed service revenues, growth was driven by a positive development for TV and fixed broadband revenues, which more than compensated for a decline in fixed telephony revenues.
Adjusted EBITDA increased 1.2% to SEK 3,394 million (3,353) and adjusted EBITDA margin decreased to 39.0% (39.8). Adjusted EBITDA like for like increased 1.2% due to the growth of service revenues.
CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 13.3% to SEK 773 million (683).
Mobile subscriptions grew by 428,000 in the quarter driven by an addition of 429,000 postpaid subscriptions used for machine-tomachine related services. TV subscriptions increased by 16,000 and fixed broadband subscriptions decreased by 8,000 in the quarter.
| SEK in millions, except margins, operational data and changes |
Jul-Sep 2022 |
Jul-Sep 2021 |
Chg % |
Jan-Sep 2022 |
Jan-Sep 2021 |
Chg % |
|---|---|---|---|---|---|---|
| Net sales | 3,723 | 3,612 | 3.1 | 11,008 | 10,702 | 2.9 |
| Change (%) like for like | -1.0 | -0.7 | ||||
| of which service revenues (external) | 3,155 | 3,007 | 4.9 | 9,364 | 9,015 | 3.9 |
| change (%) like for like | 0.7 | 0.0 | ||||
| Adjusted EBITDA | 1,140 | 1,179 | -3.3 | 3,380 | 3,280 | 3.1 |
| Margin (%) | 30.6 | 32.6 | 30.7 | 30.6 | ||
| change (%) like for like | -7.3 | -0.3 | ||||
| Adjusted operating income | 263 | 359 | -26.7 | 754 | 838 | -9.9 |
| Operating income | 240 | 362 | -33.7 | 670 | 1,122 | -40.3 |
| CAPEX excluding fees for licenses, spectrum and right-of-use assets Subscriptions, (thousands) |
376 | 433 | -13.1 | 1,122 | 1,211 | -7.4 |
| Mobile | 3,276 | 3,216 | 1.9 | 3,276 | 3,216 | 1.9 |
| of which machine-to-machine (postpaid) | 354 | 297 | 19.1 | 354 | 297 | 19.1 |
| Fixed telephony | 15 | 17 | -11.8 | 15 | 17 | -11.8 |
| Broadband | 459 | 472 | -2.8 | 459 | 472 | -2.8 |
| TV | 672 | 627 | 7.1 | 672 | 627 | 7.1 |
| Employees | 2,757 | 2,958 | -6.8 | 2,757 | 2,958 | -6.8 |
Net sales increased 3.1% to SEK 3,723 million (3,612) and like for like, net sales decreased 1.0% as increased service revenues were more than offset by lower sales of equipment. The effect of exchange rate fluctuations was positive by 4.1%.
Service revenues, like for like, increased 0.7% as a growth of 3.5% for mobile service revenues, despite lower interconnect revenues, more than compensated for a 3.3% decline for fixed service revenues. The latter driven by lower revenues from fixed broadband and legacy products in business solutions.
Adjusted EBITDA decreased 3.3% to SEK 1,140 million (1,179) and adjusted EBITDA margin decreased to 30.6% (32.6). Adjusted EBITDA like for like decreased 7.3% as operational expenses increased driven by higher energy expenses.
CAPEX excluding fees for licenses, spectrum and right-of-use assets, decreased 13.1% to SEK 376 million (433).
Mobile subscriptions increased in the quarter by 45,000 driven largely by an addition of 25,000 postpaid subscriptions used for machine-tomachine related services. TV subscriptions increased 14,000 and fixed broadband subscriptions declined by 4,000 in the quarter.
| SEK in millions, except margins, | Jul-Sep | Jul-Sep | Chg | Jan-Sep | Jan-Sep | Chg |
|---|---|---|---|---|---|---|
| operational data and changes | 2022 | 2021 | % | 2022 | 2021 | % |
| Net sales | 3,859 | 3,478 | 11.0 | 11,171 | 10,130 | 10.3 |
| Change (%) like for like | 3.9 | 4.1 | ||||
| of which service revenues (external) | 3,298 | 2,913 | 13.2 | 9,580 | 8,496 | 12.8 |
| change (%) like for like | 5.9 | 6.4 | ||||
| Adjusted EBITDA | 1,846 | 1,652 | 11.7 | 5,103 | 4,683 | 9.0 |
| Margin (%) | 47.8 | 47.5 | 45.7 | 46.2 | ||
| change (%) like for like | 4.5 | 2.9 | ||||
| Adjusted operating income | 868 | 718 | 21.0 | 2,106 | 1,745 | 20.7 |
| Operating income | 853 | 709 | 20.3 | 2,037 | 1,655 | 23.1 |
| CAPEX excluding fees for licenses, spectrum and right-of-use assets |
674 | 665 | 1.4 | 1,821 | 1,999 | -8.9 |
| Subscriptions, (thousands) | ||||||
| Mobile | 2,379 | 2,292 | 3.8 | 2,379 | 2,292 | 3.8 |
| of which machine-to-machine (postpaid) | 181 | 129 | 39.9 | 181 | 129 | 39.9 |
| Fixed telephony | 28 | 34 | -17.6 | 28 | 34 | -17.6 |
| Broadband | 498 | 490 | 1.6 | 498 | 490 | 1.6 |
| TV | 475 | 477 | -0.4 | 475 | 477 | -0.4 |
| Employees | 1,328 | 1,417 | -6.3 | 1,328 | 1,417 | -6.3 |
Net sales increased 11.0% to SEK 3,859 million (3,478) and like for like, net sales increased 3.9% due to increased service revenues which more than compensated for lower sale of equipment. The effect of exchange rate fluctuations was positive by 7.2%.
Service revenues, like for like, increased 5.9% due to growth for both mobile and fixed service revenues. Mobile service revenues grew 6.4% attributable to an expanding customer base and a positive ARPU development, whereas fixed service revenues increased 4.6% mainly due to increased revenues from fixed broadband and TV.
Adjusted EBITDA increased 11.7% to SEK 1,846 million (1,652) and adjusted EBITDA margin increased to 47.8% (47.5). Adjusted EBITDA like for like increased 4.5% driven by the growth in service revenues.
CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 1.4% to SEK 674 million (665).
Mobile subscriptions increased by 33,000 in the quarter driven partly by an addition of 16,000 postpaid subscriptions used for machine-tomachine related services. TV subscriptions remained unchanged and fixed broadband subscriptions increased by 4,000 in the quarter.
– Telia continued to make great progress on its network modernization and 5G roll-out and about 70% of the Danish population now have access to Telia's high-speed 5G network.
– As part of its ambition to offer the best network experience combined with innovative digital solutions, Telia publicly communicated the upcoming launch of 5G mobile broadband services. This will result in a mobile internet solution with capacity and speed that can compete with fiber and coax.
| SEK in millions, except margins, operational data and changes |
Jul-Sep 2022 |
Jul-Sep 2021 |
Chg % |
Jan-Sep 2022 |
Jan-Sep 2021 |
Chg % |
|---|---|---|---|---|---|---|
| Net sales | 1,371 | 1,287 | 6.6 | 3,916 | 3,810 | 2.8 |
| Change (%) like for like | 2.4 | -0.8 | ||||
| of which service revenues (external) | 1,044 | 981 | 6.4 | 3,028 | 2,839 | 6.6 |
| change (%) like for like | 2.2 | 2.5 | ||||
| Adjusted EBITDA | 268 | 235 | 14.1 | 751 | 665 | 12.9 |
| Margin (%) | 19.5 | 18.3 | 19.2 | 17.4 | ||
| change (%) like for like | 8.1 | 7.7 | ||||
| Adjusted operating income | 20 | -18 | 11 | -73 | ||
| Operating income | 2 | -25 | 3 | -106 | ||
| CAPEX excluding fees for licenses, spectrum and right-of-use assets Subscriptions, (thousands) |
124 | 135 | -8.7 | 344 | 263 | 31.0 |
| Mobile | 1,671 | 1,603 | 4.3 | 1,671 | 1,603 | 4.3 |
| of which machine-to-machine (postpaid) | 320 | 243 | 31.7 | 320 | 243 | 31.7 |
| Fixed telephony | 50 | 59 | -15.3 | 50 | 59 | -15.3 |
| Broadband | 63 | 62 | 1.6 | 63 | 62 | 1.6 |
| TV | 18 | 26 | -30.8 | 18 | 26 | -30.8 |
| Employees | 660 | 697 | -5.3 | 660 | 697 | -5.3 |
Net sales increased 6.6% to SEK 1,371 million (1,287) and like for like, net sales increased 2.4% due to increased service revenues as well as increased equipment sales. The effect of exchange rate fluctuations was positive by 4.2%.
Service revenues, like for like, increased 2.2% as fixed service revenues remained unchanged and mobile service revenues grew 2.8% driven by an increased ARPU level.
Adjusted EBITDA increased 14.1% to SEK 268 million (235) and adjusted EBITDA margin increased to 19.5% (18.3). Adjusted EBITDA like for like increased 8.1% due to service revenue growth and a lower cost level.
CAPEX excluding fees for licenses, spectrum and right-of-use assets, decreased 8.7% to SEK 124 million (135).
Mobile subscriptions increased by 40,000 in the quarter driven by the addition of 40,000 postpaid subscriptions used for machine-tomachine related services. Fixed broadband subscriptions declined by 1,000 and TV subscriptions declined by 2,000 in the quarter.
| SEK in millions, except margins, | Jul-Sep | Jul-Sep | Chg | Jan-Sep | Jan-Sep | Chg |
|---|---|---|---|---|---|---|
| operational data and changes | 2022 | 2021 | % | 2022 | 2021 | % |
| Net sales | 1,203 | 1,100 | 9.4 | 3,487 | 3,151 | 10.7 |
| Change (%) like for like | 5.1 | 6.8 | ||||
| of which service revenues (external) | 924 | 840 | 10.0 | 2,691 | 2,431 | 10.7 |
| change (%) like for like | 5.6 | 6.2 | ||||
| Adjusted EBITDA | 419 | 404 | 3.7 | 1,235 | 1,140 | 8.3 |
| Margin (%) | 34.9 | 36.8 | 35.4 | 36.2 | ||
| change (%) like for like | -0.5 | 4.5 | ||||
| Adjusted operating income | 214 | 217 | -1.7 | 616 | 576 | 7.0 |
| Operating income | 209 | 214 | -2.6 | 613 | 580 | 5.6 |
| CAPEX excluding fees for licenses, | 188 | 145 | 29.1 | 409 | 336 | 21.9 |
| spectrum and right-of-use assets | ||||||
| Subscriptions, (thousands) | ||||||
| Mobile | 1,602 | 1,449 | 10.6 | 1,602 | 1,449 | 10.6 |
| of which machine-to-machine (postpaid) | 323 | 245 | 31.8 | 323 | 245 | 31.8 |
| Fixed telephony | 182 | 208 | -12.5 | 182 | 208 | -12.5 |
| Broadband | 426 | 419 | 1.7 | 426 | 419 | 1.7 |
| TV | 255 | 254 | 0.4 | 255 | 254 | 0.4 |
| Employees | 1,549 | 1,603 | -3.4 | 1,549 | 1,603 | -3.4 |
Net sales increased 9.4% to SEK 1,203 million (1,100) and like for like, net sales increased 5.1% driven mainly by increased service revenues and to some extent also increased sales of equipment. The effect of exchange rate fluctuations was positive by 4.3%.
Service revenues, like for like, increased 5.6% due to positive development for both mobile and fixed service revenues. For mobile service revenues which increased 10.8%, the growth was the result of an increased number of subscriptions as well as a higher ARPU. For fixed service revenues which increased 1.9%, the growth was largely driven by fixed broadband.
Adjusted EBITDA increased 3.7% to SEK 419 million (404) and adjusted EBITDA margin decreased to 34.9% (36.8). Adjusted EBITDA like for like decreased 0.5% as the growth in service revenues was more than offset by increased operational expenses driven by higher energy expenses.
CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 29.1% to SEK 188 million (145).
Mobile subscriptions increased by 20,000 in the quarter driven by the addition of 6,000 postpaid and 14,000 prepaid subscriptions. Fixed broadband subscriptions increased by 2,000 and TV subscriptions increased by 1,000 in the quarter.
| SEK in millions, except margins, | Jul-Sep | Jul-Sep | Chg | Jan-Sep | Jan-Sep | Chg |
|---|---|---|---|---|---|---|
| operational data and changes | 2022 | 2021 | % | 2022 | 2021 | % |
| Net sales | 922 | 836 | 10.3 | 2,658 | 2,440 | 8.9 |
| Change (%) like for like | 5.9 | 5.1 | ||||
| of which service revenues (external) | 749 | 684 | 9.4 | 2,203 | 1,991 | 10.6 |
| change (%) like for like | 5.0 | 5.9 | ||||
| Adjusted EBITDA | 340 | 313 | 8.7 | 989 | 904 | 9.4 |
| Margin (%) | 36.9 | 37.5 | 37.2 | 37.0 | ||
| change (%) like for like | 4.4 | 5.6 | ||||
| Adjusted operating income | 193 | 153 | 26.8 | 514 | 421 | 21.8 |
| Operating income | 193 | 152 | 27.3 | 580 | 416 | 39.4 |
| CAPEX excluding fees for licenses, | 88 | 73 | 20.7 | 241 | 220 | 9.7 |
| spectrum and right-of-use assets | ||||||
| Subscriptions, (thousands) | ||||||
| Mobile | 1,255 | 1,180 | 6.4 | 1,255 | 1,180 | 6.4 |
| of which machine-to-machine (postpaid) | 435 | 393 | 10.6 | 435 | 393 | 10.6 |
| Fixed telephony | 196 | 215 | -8.8 | 196 | 215 | -8.8 |
| Broadband | 241 | 242 | -0.4 | 241 | 242 | -0.4 |
| TV | 201 | 207 | -2.9 | 201 | 207 | -2.9 |
| Employees | 1,288 | 1,295 | -0.5 | 1,288 | 1,295 | -0.5 |
Net sales increased 10.3% to SEK 922 million (836) and like for like, net sales increased 5.9% driven by increased service revenues and higher sale of equipment. The effect of exchange rate fluctuations was positive by 4.4%.
Service revenues, like for like, increased 5.0% from mobile service revenues increasing 6.3% driven by subscription base expansion and ARPU growth and fixed service revenues growing by 4.9% supported by a positive development for all services except for fixed telephony.
Adjusted EBITDA increased 8.7% to SEK 340 million (313) and adjusted EBITDA margin decreased to 36.9% (37.5). Adjusted EBITDA like for like increased 4.4% driven by the service revenue growth.
CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 20.7% to SEK 88 million (73).
Mobile subscriptions increased by 23,000 in the quarter driven by the addition of 17,000 postpaid and 6,000 prepaid subscriptions. Fixed broadband subscriptions decreased by 2,000 and TV decreased by 2,000 in the quarter.
| Jul-Sep | Jul-Sep | Chg | Jan-Sep | Jan-Sep | Chg |
|---|---|---|---|---|---|
| 2022 | 2021 | % | 2022 | 2021 | % |
| 1,898 | 1,878 | 1.1 | 6,262 | 6,053 | 3.4 |
| 0.2 | 2.6 | ||||
| 1,898 | 1,878 | 1.1 | 6,262 | 6,053 | 3.5 |
| 0.2 | 2.6 | ||||
| 234 | 191 | 23.0 | 389 | 885 | -56.1 |
| 12.3 | 10.1 | 6.2 | 14.6 | ||
| 23.5 | -56.1 | ||||
| 35 | -13 | -207 | 273 | ||
| 32 | -20 | -214 | 196 | ||
| 102 | 67 | 52.3 | 234 | 199 | 17.2 |
| 728 | 758 | -3.9 | 728 | 758 | -3.9 |
| 1,362 | 1,398 | -2.6 | 1,362 | 1,398 | -2.6 |
Net sales increased 1.1% to SEK 1,898 million (1,878) and like for like, net sales increased 0.2% driven by increased service revenues. The effect of exchange rate fluctuations was positive by 0.9%.
Service revenues, like for like, increased 0.2% as decreased TV revenues was slightly more than compensated for by growth in advertising revenues as well as also increased Other service revenues. The growth in advertising revenues was driven by a continued successful work on capitalizing on a growing demand for tv-advertising in combination with a market leading total tv-reach.
Adjusted EBITDA increased 23.0% to SEK 234 million (191) and adjusted EBITDA margin increased to 12.3% (10.1). Adjusted EBITDA like for like increased 23.5% as a result from lower content related costs.
CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 52.3% to SEK 102 million (67).
Direct subscriptions video-on-demand (SVOD) increased by 28,000 in the quarter.
| SEK in millions, except margins, | Jul-Sep | Jul-Sep | Chg | Jan-Sep | Jan-Sep | Chg |
|---|---|---|---|---|---|---|
| operational data and changes | 2022 | 2021 | % | 2022 | 2021 | % |
| Net sales | 1,061 | 957 | 10.9 | 3,051 | 4,677 | -34.8 |
| of which Telia Carrier | - | - | - | 1,944 | -100.0 | |
| of which Latvia | 784 | 632 | 24.0 | 2,194 | 1,843 | 19.0 |
| Change (%) like for like | 2.9 | 1.2 | ||||
| Adjusted EBITDA | 429 | 410 | 4.5 | 1,018 | 1,195 | -14.8 |
| of which Telia Carrier | - | - | - | 371 | -100.0 | |
| of which Latvia | 202 | 211 | -4.5 | 626 | 600 | 4.4 |
| Margin (%) | 40.4 | 42.9 | 33.4 | 25.6 | ||
| Income from associated companies | 21 | 24 | -15.2 | 49 | 74 | -33.1 |
| of which Latvia | 29 | 28 | 4.2 | 87 | 84 | 3.7 |
| Adjusted operating income | 125 | -14 | 232 | -154 | ||
| Operating income | 13 | -169 | -118 | 5,645 | ||
| CAPEX excluding fees for licenses, spectrum and right-of-use assets Subscriptions, (thousands) |
1,345 | 1,186 | 13.4 | 4,355 | 3,743 | 16.4 |
| Mobile Latvia | 1,403 | 1,338 | 4.9 | 1,403 | 1,338 | 4.9 |
| of which machine-to-machine (postpaid) | 396 | 370 | 6.9 | 396 | 370 | 6.9 |
| Employees | 6,071 | 5,988 | 1.4 | 6,071 | 5,988 | 1.4 |
In the fourth quarter of 2020 an agreement was signed to divest Telia Carrier to Polhem Infra and the transaction was closed on June 1, 2021. As the Telia Carrier business was divested on June 1, 2021, the reported figures of Telia Carrier for 2021 therefore only represent January-May.
In the fourth quarter of 2021 SIA Latvijas Mobilais Telefons (LMT) in Latvia acquired 100% of Santa Monica Networks which was consolidated from October 2021. See Note 13.
In the first quarter of 2022 an agreement was signed regarding a divestment of SIA Telia Latvija, a leading B2B telecom services provider in Latvia. The transaction was completed on June 1, 2022. See Note 12.
Net sales increased 10.9% to SEK 1,061 million (957) and like for like, net sales increased 2.9%. The effect of exchange rate fluctuations was positive by 3.7%.
Adjusted EBITDA increased 4.5% to SEK 429 million (410) and adjusted EBITDA margin decreased to 40.4% (42.9). Adjusted EBITDA like for like decreased 1.2% due to lower EBITDA in Latvia.
In Latvia, net sales increased 24.0% to SEK 784 million (632) and like for like, net sales increased 9.2% driven partly by increased service revenues although mainly increased equipment sales. The effect of exchange rate fluctuations was positive by 4.9%. Adjusted EBITDA decreased 4.5% to SEK 202 million (211) and the adjusted EBITDA margin decreased to 25.7% (33.4). Adjusted EBITDA like for like decreased 11.5% as an increase of 3.3% for service revenues was more than offset by higher operational expenses, predominately related to energy. The number of mobile subscriptions increased by 31,000 in the quarter.
| SEK in millions, except per share data and | Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep | |
|---|---|---|---|---|---|
| number of shares | Note | 2022 | 2021 | 2022 | 2021 |
| Continuing operations | |||||
| Net sales | 3, 4 | 22,456 | 21,271 | 66,566 | 64,962 |
| Cost of sales | -14,433 | -13,861 | -42,540 | -42,322 | |
| Gross profit | 8,023 | 7,410 | 24,026 | 22,640 | |
| Selling, administration and R&D expenses | -4,761 | -4,640 | -15,373 | -15,369 | |
| Other operating income and expenses, net | -96 | -165 | -251 | 6,113 | |
| Income from associated companies and joint | 23 | 29 | 55 | 76 | |
| ventures | |||||
| Operating income | 3 | 3,188 | 2,634 | 8,457 | 13,460 |
| Financial items, net | -784 | -677 | -2,525 | -2,043 | |
| Income after financial items | 3 | 2,404 | 1,957 | 5,932 | 11,417 |
| Income taxes | -521 | -335 | -1,279 | -941 | |
| Net income from continuing operations | 1,883 | 1,622 | 4,653 | 10,476 | |
| Discontinued operations | |||||
| Net income from discontinued operations | 12 | - | - | - | 176 |
| Total net income | 1,883 | 1,622 | 4,653 | 10,651 | |
| Items that may be reclassified to net income: | |||||
| Foreign currency translation differences | 164 | 315 | 1,543 | 2,007 | |
| Cash flow hedges | -215 | 60 | 147 | -48 | |
| Cost of hedging | 99 | 30 | 186 | 152 | |
| Debt instruments at fair value through OCI | 1 | -2 | -10 | -38 | |
| Income taxes relating to items that may be reclassified | 140 | 6 | 243 | 51 | |
| Items that will not be reclassified to net income: | 0 | 0 | |||
| Equity instruments at fair value through OCI | 43 | 123 | -32 | 126 | |
| Remeasurements of defined benefit pension plans | -715 | 53 | 8,005 | 4,411 | |
| Income taxes relating to items that will not be reclassified | 148 | -10 | -1,636 | -898 | |
| Other comprehensive income | -335 | 575 | 8,445 | 5,762 | |
| Total comprehensive income | 1,548 | 2,197 | 13,098 | 16,413 | |
| Total net income attributable to: | |||||
| Owners of the parent | 1,710 | 1,575 | 4,163 | 10,558 | |
| Non-controlling interests | 174 | 47 | 490 | 93 | |
| Total comprehensive income attributable to: | |||||
| Owners of the parent | 1,275 | 2,142 | 12,314 | 16,303 | |
| Non-controlling interests | 273 | 54 | 785 | 110 | |
| Earnings per share (SEK), basic and diluted | 0.42 | 0.39 | 1.02 | 2.58 | |
| of which continuing operations | 0.42 | 0.39 | 1.02 | 2.54 | |
| Number of shares (thousands) | |||||
| Outstanding at period-end | 6 | 3,990,248 | 4,089,632 | 3,990,248 | 4,089,632 |
| Weighted average, basic and diluted | 4,028,219 | 4,089,632 | 4,068,037 | 4,089,632 | |
| EBITDA from continuing operations | 15 | 7,871 | 7,476 | 22,400 | 28,261 |
| Adjusted EBITDA from continuing operations | 2, 15 | 8,070 | 7,738 | 22,954 | 22,571 |
| Depreciation, amortization and impairment | -4,706 | -4,871 | -13,999 | -14,877 | |
| losses from continuing operations | |||||
| Adjusted operating income from continuing operations |
2, 15 | 3,387 | 2,896 | 9,010 | 7,787 |
| SEK in millions | Sep 30, | Dec 31, |
|---|---|---|
| Note | 2022 | 2021 |
| Assets | ||
| Goodwill and other intangible assets 5 |
92,793 | 89,943 |
| Property, plant and equipment 5 |
73,792 | 72,741 |
| Film and program rights, non-current | 2,222 | 1,416 |
| Right-of-use assets 5 |
15,605 | 15,485 |
| Investments in associated companies and joint ventures, pension obligation assets and 9 |
11,353 | 4,749 |
| other non-current assets | ||
| Deferred tax assets | 1,096 | 1,302 |
| Long-term interest-bearing receivables 7, 9 |
8,212 | 9,244 |
| Total non-current assets | 205,072 | 194,879 |
| Film and program rights, current | 4,228 | 3,005 |
| Inventories | 2,672 | 2,040 |
| Trade and other receivables and current tax receivables 9 |
13,858 | 13,902 |
| Short-term interest-bearing receivables 7, 9 |
11,266 | 8,841 |
| Cash and cash equivalents 7 |
9,721 | 14,358 |
| Total current assets | 41,745 | 42,146 |
| Total assets | 246,817 | 237,025 |
| Equity and liabilities | ||
| Equity attributable to owners of the parent | 86,341 | 80,731 |
| Equity attributable to non-controlling interests | 3,435 | 2,812 |
| Total equity | 89,776 | 83,544 |
| Long-term borrowings 7, 9 |
90,900 | 91,637 |
| Deferred tax liabilities | 11,518 | 10,185 |
| Provisions for pensions and other long-term provisions | 4,893 | 7,001 |
| Other long-term liabilities | 2,109 | 1,914 |
| Total non-current liabilities | 109,420 | 110,736 |
| Short-term borrowings 7, 9 |
8,194 | 10,017 |
| Trade payables and other current liabilities, current tax payables and short-term provisions |
39,427 | 32,729 |
| Total current liabilities | 47,621 | 42,746 |
| Total equity and liabilities | 246,817 | 237,025 |
| SEK in millions | Jul-Sep Note 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Cash flow before change in working capital | 7,764 | 7,702 | 22,222 | 21,259 |
| Increase/decrease Film and program right assets and liabilities1 |
-767 | -120 | -992 | -203 |
| Increase/decrease other operating receivables, liabilities, and inventory |
116 | 46 | 147 | 2,251 |
| Change in working capital | -651 | -74 | -845 | 2,049 |
| Amortization and impairment of Film and program rights1 | -962 | -1,030 | -3,683 | -3,068 |
| Cash flow from operating activities | 6,151 | 6,598 | 17,694 | 20,239 |
| of which from discontinued operations | - - |
- | -131 | |
| Cash CAPEX | 15 -3,673 |
-3,141 | -10,557 | -10,165 |
| Free cash flow | 15 2,478 |
3,457 | 7,137 | 10,074 |
| of which from discontinued operations | - - |
- | -131 | |
| Cash flow from other investing activities | 3,342 | -1,640 | 3,735 | 3,987 |
| Total cash flow from investing activities | -331 | -4,781 | -6,822 | -6,178 |
| of which from discontinued operations | - - |
- | - | |
| Cash flow before financing activities | 5,820 | 1,817 | 10,872 | 14,062 |
| Cash flow from financing activities | -7,301 | -906 | -15,685 | -8,574 |
| of which from discontinued operations | - - |
- | - | |
| Cash flow for the period | -1,480 | 911 | -4,813 | 5,488 |
| of which from discontinued operations | - - |
- | -131 | |
| Cash and cash equivalents, opening balance | 11,197 | 12,989 | 14,358 | 8,332 |
| Cash flow for the period | -1,480 | 911 | -4,813 | 5,488 |
| Exchange rate differences in cash and cash equivalents | 5 147 |
175 | 227 | |
| Cash and cash equivalents, closing balance | 9,721 | 14,047 | 9,721 | 14,047 |
See Note 15 section Operational free cash flow for further information.
1) Total cash out flow from acquired Film and program rights is the total of Increase/decrease Film and program right assets and liabilities and Amortization and impairment of Film and program rights.
| SEK in millions | Owners of the | Non-controlling | Total |
|---|---|---|---|
| parent | interests | equity | |
| Opening balance, January 1, 2021 | 62,378 | 1,118 | 63,496 |
| Dividends | -8,179 | -177 | -8,356 |
| Share-based payments | 9 | - | 9 |
| Acquisition of treasury shares | -21 | - | -21 |
| New share issue | - | 7 | 7 |
| Acquisition of non-controlling interests | -2 | 2 | - |
| Total transactions with owners | -8,193 | -169 | -8,362 |
| Total comprehensive income | 16,303 | 110 | 16,413 |
| Closing balance, September 30, 2021 | 70,488 | 1,059 | 71,548 |
| Dividends | - | -1 | -1 |
| Share-based payments | 4 | - | 4 |
| New share issue | - | -7 | -7 |
| Change in non-controlling interests | 6,221 | 1,689 | 7,910 |
| Total transactions with owners | 6,225 | 1,682 | 7,907 |
| Total comprehensive income | 4,018 | 71 | 4,089 |
| Closing balance, December 31, 2021 | 80,731 | 2,812 | 83,544 |
| Dividends | -8,279 | -352 | -8,631 |
| Share-based payments | 10 | - | 10 |
| Acquisition of treasury shares | -3,683 | - | -3,683 |
| Change in non-controlling interests | 5,258 | 190 | 5,448 |
| Total transactions with owners | -6,694 | -162 | -6,856 |
| Total comprehensive income | 12,314 | 785 | 13,098 |
| Cash flow hedge transferred to assets | -10 | - | -10 |
| Closing balance, September 30, 2022 | 86,341 | 3,435 | 89,776 |
The Telia Company group applies International Financial Reporting Standards (IFRSs) as adopted by the European Union. The parent company's financial statements have been prepared in accordance with the Swedish Annual Accounts Act as well as standard RFR 2 Accounting for Legal Entities and other statements issued by the Swedish Financial Reporting Board. For the group this Interim report has been prepared in accordance with IAS 34 Interim Financial Reporting and for the parent company in accordance with the Swedish Annual Accounts Act. The accounting policies adopted, and computation methods used are consistent with those followed in the Annual and Sustainability Report 2021. All amounts in this report are presented in SEK millions, unless otherwise stated. Rounding differences may occur. If prior periods have been restated for comparability to reflect changes in financial and operational data, the changes are only described if material. In this interim report the comparative financial information for the segments has been adjusted for the changed accounting principles for cloud computing cost described in the Annual and Sustainability report 2021.
For more information regarding:
| SEK in millions | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Total within EBITDA | -199 | -262 | -553 | 5,689 |
| Restructuring charges, synergy implementation costs, costs | ||||
| related to historical legal disputes, regulatory charges and | ||||
| taxes etc.: | ||||
| Sweden | -23 | -83 | -99 | -209 |
| Finland | -23 | 2 | -85 | -25 |
| Norway | -16 | -9 | -69 | -90 |
| Denmark | -8 | -7 | -17 | -33 |
| Lithuania | -3 | -3 | -7 | -9 |
| Estonia | -1 | -1 | -7 | -5 |
| TV and Media | -3 | -7 | -13 | -77 |
| Other operations | -112 | -154 | -434 | -613 |
| Sub total | -187 | -263 | -730 | -1,062 |
| whereof personnel redundancy restructuring costs | -20 | -145 | -212 | -502 |
| whereof transformation and integration consultant costs | -82 | -100 | -281 | -301 |
| whereof other | -85 | -18 | -237 | -259 |
| Capital gains/losses1 | -12 | 1 | 177 | 6,752 |
| Within Depreciation, amortization and impairment losses | - | - | - | -16 |
| Within Income from associated companies and joint ventures |
- | - | - | - |
| Total adjustment items within operating income, continuing operations |
-199 | -262 | -553 | 5,673 |
1) First nine months 2021 includes a capital gain from the disposal of Telia Carrier and a capital gain from the disposal of the Alerta business.
| SEK in millions | Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep |
|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | |
| Net sales | ||||
| Sweden | 8,698 | 8,424 | 25,887 | 25,317 |
| of which external | 8,682 | 8,404 | 25,833 | 25,206 |
| Finland | 3,723 | 3,612 | 11,008 | 10,702 |
| of which external | 3,678 | 3,578 | 10,873 | 10,559 |
| Norway | 3,859 | 3,478 | 11,171 | 10,130 |
| of which external | 3,857 | 3,474 | 11,136 | 10,117 |
| Denmark | 1,371 | 1,287 | 3,916 | 3,810 |
| of which external | 1,360 | 1,276 | 3,880 | 3,764 |
| Lithuania | 1,203 | 1,100 | 3,487 | 3,151 |
| of which external | 1,198 | 1,095 | 3,470 | 3,122 |
| Estonia | 922 | 836 | 2,658 | 2,440 |
| of which external | 919 | 833 | 2,648 | 2,410 |
| TV and Media | 1,898 | 1,878 | 6,262 | 6,053 |
| of which external | 1,898 | 1,878 | 6,262 | 6,053 |
| Other operations | 1,061 | 957 | 3,051 | 4,677 |
| Total segments | 22,737 | 21,571 | 67,439 | 66,281 |
| Eliminations | -281 | -300 | -873 | -1,319 |
| Group | 22,456 | 21,271 | 66,566 | 64,962 |
| Adjusted EBITDA | ||||
| Sweden | 3,394 | 3,353 | 10,089 | 9,818 |
| Finland | 1,140 | 1,179 | 3,380 | 3,280 |
| Norway | 1,846 | 1,652 | 5,103 | 4,683 |
| Denmark | 268 | 235 | 751 | 665 |
| Lithuania | 419 | 404 | 1,235 | 1,140 |
| Estonia | 340 | 313 | 989 | 904 |
| TV and Media | 234 | 191 | 389 | 885 |
| Other operations | 429 | 410 | 1,018 | 1,195 |
| Total segments | 8,070 | 7,738 | 22,953 | 22,571 |
| Eliminations | - | - | - | - |
| Group | 8,070 | 7,738 | 22,954 | 22,571 |
| Operating income | ||||
| Sweden | 1,647 | 1,411 | 4,886 | 3,951 |
| Finland | 240 | 362 | 670 | 1,122 |
| Norway | 853 | 709 | 2,037 | 1,655 |
| Denmark | 2 | -25 | 3 | -106 |
| Lithuania | 209 | 214 | 613 | 580 |
| Estonia | 193 | 152 | 580 | 416 |
| TV and Media | 32 | -20 | -214 | 196 |
| Other operations | 13 | -169 | -118 | 5,645 |
| Total segments | 3,188 | 2,634 | 8,457 | 13,460 |
| Eliminations | - | - | - | - |
| Group | 3,188 | 2,634 | 8,457 | 13,460 |
| Financial items, net | -784 | -677 | -2,525 | -2,043 |
| Income after financial items | 2,404 | 1,957 | 5,932 | 11,417 |
| Sep 30, 2022 | Sep 30, 2022 | Dec 31, 2021 | Dec 31, 2021 | |
|---|---|---|---|---|
| SEK in millions | Segment | Segment | Segment | Segment |
| assets | liabilities | assets | liabilities | |
| Sweden | 45,871 | 13,398 | 46,398 | 12,486 |
| Finland | 46,828 | 4,981 | 44,796 | 5,494 |
| Norway | 56,614 | 6,909 | 56,779 | 7,400 |
| Denmark | 7,794 | 2,754 | 7,470 | 2,474 |
| Lithuania | 7,346 | 2,252 | 6,674 | 2,072 |
| Estonia | 6,119 | 1,273 | 5,682 | 1,303 |
| TV and Media | 14,771 | 3,897 | 13,032 | 2,638 |
| Other operations | 25,444 | 6,704 | 24,612 | 6,706 |
| Total segments | 210,787 | 42,169 | 205,444 | 40,573 |
| Unallocated | 36,030 | 114,872 | 31,581 | 112,910 |
| Total assets/liabilities, group | 246,817 | 157,041 | 237,025 | 153,482 |
| Jul-Sep 2022 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEK in millions | TV and | Other | Elimina | |||||||
| Sweden | Finland | Norway | Denmark | Lithuania | Estonia | Media | operations | tions | Total | |
| Mobile subscription revenues | 3,236 | 1,637 | 1,919 | 676 | 380 | 272 | - | 376 | - | 8,496 |
| Interconnect | 116 | 80 | 107 | 60 | 28 | 17 | - | 25 | - | 432 |
| Other mobile service revenues | 153 | 194 | 231 | 120 | 13 | 7 | - | 14 | - | 732 |
| Total mobile service revenues | 3,505 | 1,911 | 2,256 | 857 | 421 | 295 | - | 415 | - | 9,660 |
| Telephony | 313 | 13 | 24 | 29 | 41 | 22 | - | - | - | 443 |
| Broadband | 1,235 | 151 | 392 | 58 | 180 | 160 | 0 | 2 | - | 2,178 |
| TV | 580 | 130 | 445 | 20 | 99 | 78 | 661 | - | - | 2,013 |
| Business solutions | 642 | 579 | 112 | 29 | 81 | 78 | - | 0 | - | 1,521 |
| Other fixed service revenues | 923 | 309 | 29 | 26 | 99 | 114 | - | 12 | - | 1,511 |
| Total fixed service revenues | 3,693 | 1,182 | 1,001 | 162 | 500 | 452 | 661 | 15 | - | 7,667 |
| Advertising revenues | - | - | - | - | - | - | 1,193 | - | - | 1,193 |
| Other service revenues | 231 | 61 | 40 | 25 | 4 | 2 | 43 | 102 | - | 507 |
| Total service revenues1 | 7,429 | 3,155 | 3,298 | 1,044 | 924 | 749 | 1,898 | 532 | - | 19,028 |
| Total equipment revenues1 | 1,253 | 523 | 559 | 316 | 274 | 170 | - | 332 | - | 3,428 |
| Total external net sales | 8,682 | 3,678 | 3,857 | 1,360 | 1,198 | 919 | 1,898 | 864 | - | 22,456 |
| Internal net sales | 16 | 45 | 3 | 11 | 5 | 3 | 0 | 197 | -281 | - |
| Total net sales | 8,698 | 3,723 | 3,859 | 1,371 | 1,203 | 922 | 1,898 | 1,061 | -281 | 22,456 |
1) In all material aspects, equipment revenues are recognized at a point in time and service revenues over time.
| Jul-Sep 2021 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEK in millions | TV and | Other | Elimina | |||||||
| Sweden | Finland | Norway | Denmark | Lithuania | Estonia | Media | operations | tions | Total | |
| Mobile subscription revenues | 3,165 | 1,534 | 1,711 | 625 | 318 | 242 | - | 338 | - | 7,933 |
| Interconnect | 120 | 90 | 103 | 73 | 33 | 20 | - | 30 | - | 470 |
| Other mobile service revenues | 141 | 149 | 170 | 102 | 13 | 5 | 0 | 10 | - | 590 |
| Total mobile service revenues | 3,426 | 1,772 | 1,985 | 800 | 365 | 267 | 0 | 379 | - | 8,993 |
| Telephony | 377 | 13 | 23 | 44 | 44 | 25 | - | 0 | - | 527 |
| Broadband | 1,187 | 165 | 351 | 48 | 157 | 148 | - | 0 | - | 2,057 |
| TV | 506 | 130 | 393 | 19 | 99 | 74 | 734 | - | - | 1,955 |
| Business solutions | 677 | 596 | 101 | 32 | 76 | 68 | - | 0 | - | 1,550 |
| Other fixed service revenues | 918 | 271 | 26 | 12 | 94 | 99 | - | 14 | - | 1,434 |
| Total fixed service revenues | 3,665 | 1,175 | 895 | 155 | 471 | 414 | 734 | 15 | - | 7,522 |
| Advertising revenues | - | - | - | - | - | - | 1,115 | - | - | 1,115 |
| Other service revenues | 247 | 60 | 33 | 26 | 5 | 4 | 29 | 96 | - | 500 |
| Total service revenues1 | 7,337 | 3,007 | 2,913 | 981 | 840 | 684 | 1,878 | 490 | - | 18,130 |
| Total equipment revenues1 | 1,067 | 571 | 562 | 295 | 255 | 149 | - | 243 | - | 3,141 |
| Total external net sales | 8,404 | 3,578 | 3,474 | 1,276 | 1,095 | 833 | 1,878 | 733 | - | 21,271 |
| Internal net sales | 20 | 34 | 4 | 11 | 5 | 3 | 0 | 224 | -300 | - |
| Total net sales | 8,424 | 3,612 | 3,478 | 1,287 | 1,100 | 836 | 1,878 | 957 | -300 | 21,271 |
| 1) In all material aspects, equipment revenues are recognized at a point in time and service revenues over time. |
| Jan-Sep 2022 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEK in millions | TV and | Other | Elimina | |||||||
| Sweden | Finland | Norway | Denmark | Lithuania | Estonia | Media | operations | tions | Total | |
| Mobile subscription revenues | 9,610 | 4,820 | 5,594 | 1,972 | 1,082 | 791 | - | 1,098 | - | 24,965 |
| Interconnect | 355 | 247 | 327 | 196 | 84 | 48 | - | 74 | - | 1,330 |
| Other mobile service revenues | 426 | 529 | 585 | 318 | 29 | 13 | - | 34 | - | 1,934 |
| Total mobile service revenues | 10,391 | 5,595 | 6,506 | 2,485 | 1,194 | 851 | - | 1,206 | - | 28,229 |
| Telephony | 994 | 43 | 76 | 91 | 126 | 70 | - | 1 | - | 1,402 |
| Broadband | 3,652 | 463 | 1,186 | 169 | 522 | 471 | 1 | 7 | - | 6,470 |
| TV | 1,709 | 402 | 1,273 | 58 | 298 | 230 | 2,110 | - | - | 6,080 |
| Business solutions | 1,977 | 1,761 | 332 | 86 | 229 | 234 | - | 0 | - | 4,618 |
| Other fixed service revenues | 2,799 | 926 | 82 | 65 | 312 | 340 | - | 32 | - | 4,557 |
| Total fixed service revenues | 11,131 | 3,595 | 2,949 | 469 | 1,487 | 1,344 | 2,111 | 40 | - | 23,126 |
| Advertising revenues | - | - | - | - | - | - | 4,034 | - | - | 4,034 |
| Other service revenues | 733 | 173 | 125 | 74 | 10 | 7 | 117 | 324 | - | 1,563 |
| Total service revenues1 | 22,255 | 9,364 | 9,580 | 3,028 | 2,691 | 2,203 | 6,262 | 1,570 | - | 56,952 |
| Total equipment revenues1 | 3,578 | 1,510 | 1,557 | 852 | 779 | 446 | - | 893 | - | 9,614 |
| Total external net sales | 25,833 | 10,873 | 11,136 | 3,880 | 3,470 | 2,648 | 6,262 | 2,463 | - | 66,566 |
| Internal net sales | 54 | 135 | 34 | 35 | 17 | 9 | 0 | 588 | -873 | - |
| Total net sales | 25,887 | 11,008 | 11,171 | 3,916 | 3,487 | 2,658 | 6,262 | 3,051 | -873 | 66,566 |
1) In all material aspects, equipment revenues are recognized at a point in time and service revenues over time.
| Jan-Sep 2021 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEK in millions | TV and | Other | Elimina | |||||||
| Sweden | Finland | Norway | Denmark | Lithuania | Estonia | Media | operations | tions | Total | |
| Mobile subscription revenues | 9,369 | 4,568 | 4,917 | 1,860 | 910 | 699 | - | 988 | - | 23,310 |
| Interconnect | 366 | 284 | 304 | 184 | 105 | 59 | - | 99 | - | 1,402 |
| Other mobile service revenues | 378 | 424 | 461 | 257 | 27 | 10 | - | 21 | - | 1,579 |
| Total mobile service revenues | 10,113 | 5,275 | 5,682 | 2,301 | 1,043 | 768 | - | 1,109 | - | 26,290 |
| Telephony | 1,213 | 47 | 77 | 132 | 137 | 81 | - | 1 | - | 1,688 |
| Broadband | 3,515 | 491 | 1,048 | 139 | 459 | 437 | 0 | 8 | - | 6,097 |
| TV | 1,484 | 399 | 1,192 | 52 | 296 | 215 | 2,212 | - | - | 5,850 |
| Business solutions | 2,027 | 1,784 | 309 | 113 | 201 | 197 | - | 35 | - | 4,664 |
| Other fixed service revenues | 2,766 | 836 | 72 | 32 | 283 | 285 | - | 1,569 | - | 5,842 |
| Total fixed service revenues | 11,005 | 3,557 | 2,697 | 468 | 1,375 | 1,214 | 2,212 | 1,613 | - | 24,142 |
| Advertising revenues | - | - | - | - | - | - | 3,757 | - | - | 3,757 |
| Other service revenues | 787 | 183 | 116 | 70 | 14 | 10 | 84 | 306 | - | 1,570 |
| Total service revenues1 | 21,905 | 9,015 | 8,496 | 2,839 | 2,431 | 1,991 | 6,053 | 3,029 | - | 55,759 |
| Total equipment revenues1 | 3,300 | 1,543 | 1,621 | 925 | 691 | 419 | - | 703 | - | 9,203 |
| Total external net sales | 25,206 | 10,559 | 10,117 | 3,764 | 3,122 | 2,410 | 6,053 | 3,731 | - | 64,962 |
| Internal net sales | 112 | 144 | 13 | 46 | 29 | 30 | 0 | 946 | -1,319 | - |
| Total net sales | 25,317 | 10,702 | 10,130 | 3,810 | 3,151 | 2,440 | 6,053 | 4,677 | -1,319 | 64,962 |
1) In all material aspects, equipment revenues are recognized at a point in time and service revenues over time.
| SEK in millions | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| CAPEX | 4,751 | 4,936 | 14,003 | 14,794 |
| Intangible assets | 1,148 | 1,702 | 3,007 | 4,152 |
| Property, plant and equipment | 2,894 | 2,689 | 8,473 | 7,914 |
| Right-of-use assets | 709 | 545 | 2,523 | 2,728 |
| Acquisitions and other investments | 29 | 87 | 146 | 142 |
| Asset retirement obligations | 29 | 50 | 69 | 82 |
| Goodwill, intangible and tangible non-current assets acquired in business combinations |
- | - | - | - |
| Equity instruments | - | 37 | 77 | 61 |
| Total investments | 4,780 | 5,023 | 14,148 | 14,936 |
On April 6, 2022, the Annual General Meeting authorized the Board of Directors to decide on a share buy-back program. Repurchases of shares may be made on one or more occasions before the annual general meeting 2023. On June 1, 2022, the Board of Directors decided to initiate a share buy-back program with the intention to buy back shares for SEK 5.4 billion starting no earlier than June 15, 2022 and ending no later than February 28, 2023. The total price for the repurchased shares under the share buy-back program during the third quarter and the first nine months 2022 was SEK 3,287 million and SEK 3,670 million respectively and no transaction costs were paid.
During May 2022 Telia Company acquired additional 339,912 treasury shares, at an average price of SEK 40,01 to cover commitments under the "Long term Incentive Program 2019/2022". No purchases were made in the third quarter and the total price for the repurchased shares during the first nine months 2022 was SEK 14 million and transaction costs, net of tax, amounted to SEK 0 million. During the third quarter and the first nine months 2022, Telia Company transferred 19,014 and 331,730 shares respectively to the incentive program participants.
In total the acquisitions of treasury shares under the share buy-back program and the LTI program reduced other contributed capital within parent shareholder's equity by SEK 3,683 million during the nine-month period ended September 30, 2022.
As of September 30, 2022, Telia Company held 99,383,256 treasury shares (0) and the total number of issued and outstanding shares was 4,089,631,702 and 3,990,248,446 respectively.
| SEK in millions | Sep 30, 2022 |
Dec 31, 2021 |
|---|---|---|
| Long-term borrowings | 90,900 | 91,634 |
| of which lease liabilities, non-current | 12,966 | 12,859 |
| Less 50% of hybrid capital1 | -10,963 | -10,428 |
| Short-term borrowings | 8,194 | 10,017 |
| of which lease liabilities, current | 3,181 | 2,872 |
| Less derivatives recognized as financial assets and hedging long-term and short-term borrowings and related credit support annex (CSA) |
-7,643 | -1,705 |
| Less long-term bonds and interest rates derivatives at fair value through income statement and OCI | -4,538 | -5,931 |
| Less short-term investments | -3,723 | -6,097 |
| Less cash and cash equivalents | -9,721 | -14,358 |
| Net debt | 62,507 | 63,133 |
1) 50% of hybrid capital is treated as equity, consistent with market practice for this type of instrument, and reduces net debt.
Derivatives recognized as financial assets and hedging long-term and short-term borrowings and related credit support annex (CSA) are part of the balance sheet line items Long-term interest-bearing receivables and Short-term interest-bearing receivables. Hybrid capital is part of the balance sheet line-item Long-term borrowings. Long-term bonds at fair value through income statement and OCI are part of the balance sheet line-item Long-term interest-bearing receivables. Short-term investments are part of the balance sheet line-item Short-term interestbearing receivables.
During the third quarter of 2022, Telia Company issued a hybrid bond of EUR 600 million (SEK 6.5 billion) to a yield of 4.88 percent with the first reset date after 5.25 years. This was the second hybrid transaction this year, in addition to the issue in the first quarter of 2022 of a green hybrid bond of EUR 500 million (SEK 5.2 billion) to a yield of 2.88 percent with the first reset date after 6.25 years issued under Telia's Green Bond Framework.
Outstanding bonds with a nominal amount corresponding to SEK 17.0 billion, of which hybrid bonds with a nominal amount corresponding to SEK 11.7 billion with call dates in October 2022 and April 2023, were repaid during the first nine months of 2022. The nominal value of Telia Company's hybrid notes remains unchanged.
A new sustainability linked Revolving Credit Facility of EUR 1,200 million (SEK 13.0 billion) was signed in the third quarter of 2022 with a group of twelve relationship banks. The Facility has a tenor of 5 years and includes two extension options of one year each, subject to approval of the lenders, thereby ensuring full eligibility under the rating agencies' liquidity models. The new loan facility has a clear connection to Telia's sustainability strategy, as the loan margin is linked to Telia's sustainability performance within climate, diversity and digital skills.
The credit rating of Telia Company remained unchanged during the first nine months of 2022. Moody's rating for long-term borrowings is Baa1 with a stable outlook. The Standard & Poor long-term rating is BBB+ and the short-term rating is A-2, both with a stable outlook.
| Sep 30, 2022 | Dec 31, 2021 | |||
|---|---|---|---|---|
| Long-term and short-term borrowings1 SEK in millions |
Carrying | Fair | Carrying | Fair |
| value | value | value | value | |
| Long-term borrowings | ||||
| Interest rate derivatives at fair value | 6,882 | 6,882 | 771 | 771 |
| Cross-currency interest rate derivatives at fair value | 107 | 107 | 800 | 800 |
| Subtotal | 6,988 | 6,988 | 1,570 | 1,570 |
| Open-market financing borrowings in fair value hedge relationships | 40,261 | 44,836 | 53,451 | 59,477 |
| Open-market financing borrowings at amortized cost | 30,012 | 30,808 | 23,215 | 28,084 |
| Other borrowings at amortized cost | 672 | 672 | 541 | 541 |
| Lease liabilities at amortized cost | 12,966 | 12,859 | ||
| Total long-term borrowings | 90,900 | 91,637 | ||
| Short-term borrowings | ||||
| Interest rate derivatives at fair value | 14 | 14 | 92 | 92 |
| Cross-currency interest rate derivatives at fair value | 125 | 125 | 223 | 223 |
| Subtotal | 138 | 138 | 315 | 315 |
| Utilized bank overdraft and short-term credit facilities at amortized cost | - | - | 6 | 6 |
| Open-market financing borrowings in fair value hedge relationships | 2,085 | 2,087 | 6,001 | 6,037 |
| Open-market financing borrowings at amortized cost | 1,897 | 1,897 | - | - |
| Other borrowings at amortized cost | 892 | 892 | 823 | 823 |
| Lease liabilities at amortized cost | 3,181 | 2,872 | ||
| Total short-term borrowings | 8,194 | 10,017 |
1) For financial assets the carrying amount is a reasonable approximation of fair value. For information on fair value estimation, see the Annual and Sustainability Report 2021, Note C3 to the consolidated financial statements.
| Sep 30, 2022 | Dec 31, 2021 | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Financial assets and liabilities by | of which | of which | |||||||
| fair value hierarchy level1 SEK in millions |
Carrying | Level | Level | Level | Carrying | Level | Level | Level | |
| value | 1 | 2 | 3 | value | 1 | 2 | 3 | ||
| Financial assets at fair value | |||||||||
| Equity instruments at fair value through OCI | 621 | 4 | - | 616 | 576 | - | - | 576 | |
| Equity instruments at fair value through income statement | 18 | - | - | 18 | 18 | - | - | 18 | |
| Long- and short-term bonds at fair value through OCI | 828 | 828 | - | - | 830 | 830 | - | - | |
| Long- and short-term bonds at fair value through income | - | ||||||||
| statement | 7,899 | 6,996 | 904 | - | 11,578 | 9,883 | 1,695 | ||
| Derivatives designated as hedging instruments | 1,759 | - | 1,759 | - | 1,034 | - | 1,034 | - | |
| Derivatives at fair value through income statement | 354 | - | 354 | - | 462 | - | 462 | - | |
| Total financial assets at fair value by level | 11,479 | 7,828 | 3,016 | 634 | 14,497 | 10,713 | 3,191 | 594 | |
| Financial liabilities at fair value | |||||||||
| Derivatives designated as hedging instruments | 7,091 | - | 7,091 | - | 1,734 | - | 1,734 | - | |
| Derivatives at fair value through income statement | 140 | - | 140 | - | 166 | - | 166 | - | |
| Total financial liabilities at fair value by level | 7,231 | - | 7,231 | - | 1,900 | - | 1,900 | - |
1) For information on fair value hierarchy levels and fair value estimation, see the Annual and Sustainability Report 2021, Note C3 to the consolidated financial statements and the section below.
Investments classified within Level 3 make use of significant unobservable inputs in deriving fair value, as they trade infrequently. As observable prices are not available for these equity instruments, Telia Company has a market approach to derive the fair value. Telia Company's primary valuation technique used for estimating the fair value of unlisted equity instruments in Level 3 is based on the most recent transaction for the specific company if such transaction has been recently done.
If there have been significant changes in circumstances between the transaction date and the balance sheet date that, in the assessment of Telia Company, would have a material impact on the fair value, the carrying value is adjusted to reflect the changes.
| Assets, Jan-Sep 2022 |
||||||
|---|---|---|---|---|---|---|
| Movements within Level 3, fair value hierarchy, SEK in millions | Equity instruments at fair value through OCI |
Equity instruments at fair value through income statement |
Total | |||
| Level 3, opening balance | 576 | 18 | 594 | |||
| Changes in fair value | -26 | - | -26 | |||
| of which recognized in other comprehensive income | -26 | - | -26 | |||
| Purchases/Equity conversions | 77 | - | 77 | |||
| Reclassifications | -10 | - | -10 | |||
| Settlements | -2 | - | -2 | |||
| Exchange rate differences | 2 | - | 2 | |||
| Level 3, closing balance | 616 | 18 | 634 |
| Assets, Jan-Dec 2021 |
||||||
|---|---|---|---|---|---|---|
| Movements within Level 3, fair value hierarchy, SEK in millions | Equity instruments at fair value through OCI |
Equity instruments at fair value through income statement |
Total | |||
| Level 3, opening balance | 473 | 18 | 491 | |||
| Changes in fair value | 126 | - | 126 | |||
| of which recognized in other comprehensive income | 126 | - | 126 | |||
| Purchases/capital contributions | 50 | - | 50 | |||
| Disposals | -71 | - | -71 | |||
| Settlements | -2 | - | -2 | |||
| Exchange rate differences | 1 | - | 1 | |||
| Level 3, closing balance | 576 | 18 | 594 |
| SEK in millions | Sep 30, 2022 |
Dec 31, 2021 |
|---|---|---|
| Issued financial guarantees | 324 | 288 |
| of which referred to guarantees for pension obligations | 323 | 287 |
| Collateral pledged | 40 | 38 |
| Total contingent liabilities and collateral pledged | 364 | 326 |
As disclosed in the Annual and Sustainability Report 2021, the Norwegian Tax Administration (NTA) is performing a VAT audit investigating the treatment of the supply of electronic News services during the years 2016-2018 in GET AS, which was acquired by Telia Company in 2018. Based on the latest communication with the NTA, it is deemed likely that Telia Company will be required to pay an amount of approximately SEK 0.3 billion in the first quarter 2023. However, no material provision has been recognized since it is deemed probable that the amount will be repaid.
The Finnish Tax Agency (FTA) has in an advance ruling concluded that Telia Towers Finland Oy is to be classified as a Real estate company and the FTA has requested Telia Company to file a Real Estate Transfer Tax return. The FTA has estimated the real estate transfer tax related to Telia Towers Finland Oy to approximately SEK 0.3 billion. Telia Company has appealed the ruling. Management's assessment is that it is probable that Telia Company will win the final appeal in court and no provision has therefore been recognized. For other ongoing legal proceedings, see Note C30 in the Annual and Sustainability Report 2021.
| SEK in millions | Sep 30, 2022 |
Dec 31, 2021 |
|---|---|---|
| Contractual obligations and commitments | 19,183 | 20,399 |
| of which film and program rights | 13,422 | 14,556 |
| Total contractual obligations and commitments | 19,183 | 20,399 |
There was no net income from discontinued operations in 2022. First nine months of 2021 had net income from discontinued operations of SEK 176 million related to a gain from changes in provisions for transaction warranties and EPS from discontinued operations was SEK 0.04.
On March 1, 2022, Telia Company divested its Digital Health business to Camanio AB at a price of SEK 39 million, which resulted in a capital gain and positive cash flow effect of SEK 39 million in the first quarter 2022.
On January 4, 2022, Telia Company signed an agreement to divest its 100% ownership in SIA Telia Latvija to Telia Company's associated company SIA Tet at a price corresponding to an enterprise value of EUR 10.75 million (approximately SEK 110 million) on a cash and debt free basis. The price represents a FY 2021 (estimated) EV/EBITDA multiple of 10x. The transaction was subject to customary regulatory approvals and was closed on May 31, 2022. The disposal resulted in a capital loss of SEK 5 million and a positive cash flow effect of SEK 108 million classified as investing activities.
On January 27, 2022, Telia Company signed an agreement to divest a 49% stake in its Swedish tower business to Brookfield and Alecta at a price corresponding to an enterprise value for 100% of SEK 11,224 million on a cash and debt free basis. The transaction was subject to customary regulatory approvals and was closed on June 1, 2022. The transaction resulted in an increase of equity attributable to owners of the parent of SEK 5,258 million (net including transaction costs of SEK 26 million) and an increase of equity attributable to non-controlling interests of SEK 190 million. The disposal had a positive cash flow effect for the group in the second quarter 2022 of SEK 5,475 million which was recognized within financing activities.
On October 8, 2021, SIA Latvijas Mobilais Telefons (LMT) in Latvia acquired 100% of the Baltic data transmission network and IT security solutions enterprise group, Santa Monica Networks from Livonia Partners. The preliminary purchase price allocation disclosed in the Annual and Sustainability report 2021 has been adjusted during the first quarter 2022 based on the finalized valuation of identified intangible assets and related deferred tax. The carrying value of intangible assets has been increased by SEK 131 million (whereof customer relationships SEK 100 million and brands SEK 31 million) and a related deferred tax liability of SEK 10 million has been recognized. Goodwill has been reduced by the corresponding net amount of SEK -121 million. The cost of the combination, the fair values of net assets acquired and goodwill for the combination are presented in the table below.
| Santa Monica | |
|---|---|
| SEK in millions | Networks |
| Cost of combination | 366 |
| Fair value of net assets acquired | |
| Intangible assets | 132 |
| of which customer relationships | 100 |
| of which brands | 31 |
| Other non-current assets | 7 |
| Non-current assets | 140 |
| Other current assets | 136 |
| Cash and cash equivalents | 21 |
| Current assets | 158 |
| Total assets acquired | 297 |
| Deferred tax liabilities | 10 |
| Other non-current liabilities | 30 |
| Non-current liabilities | 40 |
| Current liabilities | 178 |
| Total liabilities assumed | 219 |
| Total fair value of net assets acquired | 79 |
| Goodwill | 287 |
No part of goodwill is expected to be deductible for tax purposes. Acquisition related costs of SEK 2 million have been recognized as other operating expenses in 2021. The fair value and gross contractual amounts of acquired receivables were SEK 68 million (accounts receivables). The total value is expected to be collected. For more information on the Santa Monica Networks business combination, see Note C34 in the Annual and Sustainability report 2021.
The key ratios presented in the table below are based on the total Telia Company group including both continuing and discontinued operations.
| Sep 30, | Dec 31, | |
|---|---|---|
| 2022 | 2021 | |
| Return on equity (%, rolling 12 months)1 | 7.3 | 18.5 |
| Return on capital employed (%, rolling 12 months)1 | 6.2 | 9.1 |
| Equity/assets ratio (%)1 | 33.9 | 31.7 |
| Net debt/adjusted EBITDA ratio (multiple, rolling 12 months) | 2.07 | 2.14 |
| Parent owners' equity per share (SEK)1 | 21.16 | 19.74 |
1) Equity is adjusted by weighted ordinary dividend, see the Annual and Sustainability Report 2021 section Definitions for key ratio definitions.
In addition to financial performance measures prepared in accordance with IFRS, Telia Company presents non-IFRS financial performance measures. These alternative measures are considered to be important performance indicators for investors and other users of the Interim report. The alternative performance measures should be considered as a complement to, but not a substitute for, the information prepared in accordance with IFRS. Telia Company's definitions of these non-IFRS measures are described in the Annual and Sustainability Report 2021. These terms may be defined differently by other companies and are therefore not always comparable to similar measures used by other companies.
| SEK in millions | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Net sales | 22,456 | 21,271 | 66,566 | 64,962 |
| Excluded: Equipment revenues | -3,428 | -3,141 | -9,614 | -9,203 |
| Service revenues (external) | 19,028 | 18,130 | 56,952 | 55,759 |
| Excluded: Effects from changes in foreign exchange rates1 | -481 | 2 | -1,207 | 49 |
| Excluded: Effects from acquired and disposed operations | -12 | -17 | -65 | -1,553 |
| Service revenues on a like-for-like basis2 | 18,535 | 18,116 | 55,681 | 54,255 |
| of which Core Telco business | 16,656 | 16,240 | 49,469 | 48,203 |
| of which Tv and Media | 1,879 | 1,875 | 6,211 | 6,052 |
1) Changes in foreign exchange rates refers to full year average rates prior year. 2) Like for like excludes exchange rate effects and is based on the current group structure, i.e. including the impact of any acquired operations and excluding the impact of any disposed operations, both in the current and in the comparable period. See also section Definitions.
| SEK in millions | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Operating income | 3,188 | 2,634 | 8,457 | 13,460 |
| Excluded: Income from associated companies and joint ventures | -23 | -29 | -55 | -76 |
| Excluded: Total depreciation/amortization/write-down | 4,706 | 4,871 | 13,999 | 14,877 |
| EBITDA | 7,871 | 7,476 | 22,400 | 28,261 |
| Adjustment items within EBITDA (Note 2) | 199 | 262 | 553 | -5,689 |
| Adjusted EBITDA | 8,070 | 7,738 | 22,954 | 22,571 |
| Excluded: Effects from changes in foreign exchange rates1 | -218 | 8 | -540 | 28 |
| Excluded: Effects from acquired and disposed operations | -6 | 20 | -21 | -356 |
| Adjusted EBITDA on a like-for-like basis2 | 7,846 | 7,766 | 22,393 | 22,244 |
| of which Core Telco business | 7,611 | 7,575 | 22,005 | 21,359 |
| of which Tv and Media | 235 | 190 | 388 | 885 |
| Excluded: Impact from increased energy costs3 | 296 | - | 479 | - |
| Adjusted EBITDA on a like-for-like basis2 excluding impact from increased energy costs3 |
8,143 | 7,766 | 22,872 | 22,244 |
1) Changes in foreign exchange rates refers to full year average rates prior year. 2) Like for like excludes exchange rate effects and is based on the current group structure, i.e. including the impact of any acquired operations and excluding the impact of any disposed operations, both in the current and in the comparable period. See also section Definitions. 3) Increased energy costs in 2022 compared to 2021.
| SEK in millions | Jul-Sep | Jul-Sep | Jan-Sep | Jan-Sep |
|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | |
| Operating income | 3,188 | 2,634 | 8,457 | 13,460 |
| Adjustment items within Operating income (Note 2) | 199 | 262 | 553 | -5,673 |
| Adjusted operating income | 3,387 | 2,896 | 9,010 | 7,787 |
| SEK in millions | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Investments in intangible assets | 1,148 | 1,702 | 3,007 | 4,152 |
| Investments in property, plant and equipment | 2,894 | 2,689 | 8,473 | 7,914 |
| CAPEX excluding right of use assets | 4,042 | 4,391 | 11,480 | 12,066 |
| Investments in right-of-use assets | 709 | 545 | 2,523 | 2,728 |
| CAPEX | 4,751 | 4,936 | 14,003 | 14,794 |
| Excluded: investments in license and spectrum fees and right-of use assets |
-1,081 | -1,548 | -3,066 | -4,853 |
| CAPEX excluding fees for licenses and spectrum and right of use assets |
3,670 | 3,388 | 10,937 | 9,941 |
| SEK in millions, except ratio | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| CAPEX | 4,751 | 4,936 | 14,003 | 14,794 |
| Excluded: investments in right-of-use assets | -709 | -545 | -2,523 | -2,728 |
| Net of not paid investments and additional payments from previous periods |
-369 | -1,251 | -923 | -1,901 |
| Cash CAPEX | 3,673 | 3,141 | 10,557 | 10,165 |
| Excluded: Cash CAPEX for licenses and spectrum fees | -262 | -15 | -456 | -935 |
| Cash CAPEX, excluding fees for licenses and spectrum | 3,411 | 3,126 | 10,099 | 9,229 |
| Net sales | 22,456 | 21,271 | 66,566 | 64,962 |
| Cash CAPEX, excluding fees for licenses and spectrum in relation to net sales (%) |
15.2 | 14.7 | 15.2 | 14.2 |
| SEK in millions | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Cash flow from operating activities | 6,151 | 6,598 | 17,694 | 20,239 |
| Cash CAPEX (paid intangible and tangible assets) | -3,673 | -3,141 | -10,557 | -10,165 |
| Free cash flow | 2,478 | 3,457 | 7,137 | 10,074 |
| SEK in millions | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Cash flow from operating activities from continuing operations |
6,151 | 6,598 | 17,694 | 20,371 |
| Cash CAPEX from continuing operations | -3,673 | -3,141 | -10,557 | -10,165 |
| Free cash flow, continuing operations | 2,478 | 3,457 | 7,137 | 10,205 |
| Excluded: Cash CAPEX for licenses and spectrum fees from continuing operations |
262 | 15 | 456 | 935 |
| Excluded: Dividends from associates from continuing operations |
- | - | -136 | -152 |
| Excluded: Taxes paid on dividends from associates from continuing operations |
- | - | - | - |
| Repayments of lease liabilities | -688 | -534 | -2,115 | -1,958 |
| Operational free cash flow | 2,052 | 2,937 | 5,342 | 9,031 |
| Excluded: Changes in working capital | 651 | 74 | 845 | -2,049 |
| Structural part of Operational free cash flow | 2,703 | 3,011 | 6,187 | 6,982 |
| SEK in millions, except for multiple | Sep 30, 2022 |
Dec 31, 2021 |
|---|---|---|
| Net debt | 62,507 | 63,133 |
| Adjusted EBITDA continuing operations accumulated current year | 22,954 | 29,861 |
| Adjusted EBITDA continuing operations previous year | 7,290 | - |
| Excluding: Disposed operations | - | -371 |
| Adjusted EBITDA rolling 12 months excluding disposed operations | 30,243 | 29,491 |
| Net debt/adjusted EBITDA ratio (multiple) | 2.07x | 2.14x |
| SEK in millions, except ratio | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Net sales | 22,456 | 21,271 | 66,566 | 64,962 |
| Adjusted EBITDA | 8,070 | 7,738 | 22,954 | 22,571 |
| Adjusted EBITDA margin (%) | 35.9 | 36.4 | 34.5 | 34.7 |
| SEK in millions | Jul-Sep 2022 |
Jul-Sep 2021 |
Jan-Sep 2022 |
Jan-Sep 2021 |
|---|---|---|---|---|
| Net sales | 235 | 266 | 1,121 | 510 |
| Cost of sales | -111 | -122 | -720 | -122 |
| Gross income | 124 | 144 | 401 | 388 |
| Operating expenses and other operating income, net | -271 | -345 | -811 | -1,025 |
| Operating income | -146 | -200 | -410 | -637 |
| Financial items, net | -660 | -271 | 10,077 | 9,219 |
| Income after financial items | -806 | -472 | 9,667 | 8,582 |
| Appropriations | 2,087 | 1,412 | 4,343 | 4,021 |
| Income before taxes | 1,281 | 940 | 14,010 | 12,603 |
| Income taxes | -244 | -196 | -342 | -614 |
| Net income | 1,037 | 744 | 13,668 | 11,989 |
Financial items net in the third quarter 2022 decreased to SEK -660 million (-271). 2022 was negative impacted by foreign exchange losses and increased interest expenses.
Net sales and Cost of sales in first nine months 2022 increased to SEK 1,121 million (510) and SEK -720 million (-122) respectively mainly due to increased Net sales and Cost of sales related to film and program rights.
Financial items net in the first nine months 2022 increased to SEK 10,077 million (9,219). 2022 was mainly impacted by the capital gain of SEK 11,055 million from the disposal of Telia Towers Sweden AB and 2021 by the capital gain of SEK 6,279 million from the disposal of the Telia Carrier subsidiaries. 2022 was further impacted by dividends from subsidiaries of SEK 1,722 million (7,999). 2021 was also impacted by an impairment of the subsidiary Telia Finland Oyj of SEK 4,500 million. In addition, 2022 was negative impacted by foreign exchange losses and increased interest expenses.
| SEK in millions | Sep 30, | Dec 31, |
|---|---|---|
| Assets | 2022 | 2021 |
| Non-current assets | 167,795 | 163,412 |
| Current assets | 40,800 | 43,865 |
| Total assets | 208,595 | 207,277 |
| Equity and liabilities | ||
| Restricted shareholders' equity | 15,712 | 15,712 |
| Non-restricted shareholders' equity | 71,654 | 69,722 |
| Total shareholders' equity | 87,366 | 85,434 |
| Untaxed reserves | 6,046 | 6,707 |
| Provisions | 421 | 441 |
| Long-term liabilities | 77,271 | 78,240 |
| Short-term liabilities and short-term provisions | 37,492 | 36,455 |
| Total equity and liabilities | 208,595 | 207,277 |
Non-current assets increased to SEK 167,795 million (163,412) mainly due to shareholder contributions made to subsidiaries.
Current assets decreased to SEK 40,800 million (43,865) due to reduced cash and short-term investments offset by increased other current interest-bearing receivables.
Equity increased to SEK 87,366 million (85,434) impacted by Net income offset by approved dividend and acquired Treasury shares.
Long-term liabilities decreased to SEK 77,271 million (78,240) impacted by a decrease in bonds, including a reclassification to short term liabilities, partly offset by an increase in derivates.
Short-term liabilities and short-term provisions increased to SEK 37,492 million (36,455) mainly due to the unpaid dividend liability and a reclassification from long-term bonds partly offset by matured bonds.
Telia Company operates in a broad range of geographical product and service markets in the highly competitive and regulated telecommunications industry. Telia Company has defined risk as anything that could have a material adverse effect on the achievement of Telia Company's goals. Risks can be threats, uncertainties or lost opportunities relating to Telia Company's current or future operations or activities. Telia Company has an established risk management framework in place to regularly identify, analyze, assess, and report business, financial as well as ethics and sustainability risks and uncertainties, and to mitigate such risks when appropriate. Telia Company's risk universe consists of four categories and over thirty risk areas used to aggregate and categorize risks identified across the organization within the risk management framework, see below.
For further information regarding details on risk exposure and risk management, see the Annual and Sustainability Report 2021, Directors Report, section Risk and uncertainties.
In addition, on 24 February 2022, Russian military forces launched a military action against Ukraine. Although the length, impact and outcome of the ongoing military conflict is highly unpredictable, this conflict and related imposed sanctions could lead to market disruptions. These disruptions, of which some have already materialized, may include significant volatility in commodity- and energy prices, international credit and capital markets, and asset prices, as well as supply chain interruptions, deteriorating financing conditions and increased risks for cyber-attacks. In addition, a deterioration of the overall macro-economic environment will have an adverse impact. For Telia Company, a deterioration of the overall macro-economic environment together with aforementioned market disruptions, could lead to a further increase in energy costs, volatility in market values and interest rates, disruptions and delays of supplies (in particular from Asia) and a decrease in travel to and from the Nordic and Baltic countries resulting in roaming decline, which all could have an adverse impact on Telia Company's earnings. Telia Company may also be subject to direct cyber-attacks affecting our operation and our customers or be impacted indirectly by cyber-attacks against critical infrastructure in society.
Related mitigating activities:
Risks that can have a material impact on the strategic objectives arising from internal or external factors
risks Risks that can cause unexpected variability or volatility in net sales, margins, earnings per share, returns or market capitalization
Risks that may affect or compromise execution of business functions or have an impact on society
Risks related to legal or governmental actions that can have a material impact on the achievement of business objectives
Stockholm, October 21, 2022
Allison Kirkby President and CEO
We have reviewed the interim report for Telia Company AB (publ) for the period January 1 - September 30, 2022. The Board of Directors and the President are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
We conducted our review in accordance with the International Standard on Review Engagements ISRE 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review has a different focus and is substantially less in scope than an audit conducted in accordance with ISA and other generally accepted auditing practices. The procedures performed in a review do not enable us to obtain a level of assurance that would make us aware of all significant matters that might be identified in an audit. Therefore, the conclusion expressed based on a review does not give the same level of assurance as a conclusion expressed based on an audit.
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not, in all material respects, prepared for the Group in accordance with IAS 34 and the Annual Accounts Act, and for the Parent Company in accordance with the Annual Accounts Act.
Stockholm, October 21, 2022
Deloitte AB
Peter Ekberg Authorized Public Accountant
This report contains statements concerning, among other things, Telia Company's financial condition and results of operations that are forward-looking in nature. Such statements are not historical facts but, rather, represent Telia Company's future expectations. Telia Company believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions; however, forwardlooking statements involve inherent risks and uncertainties, and a number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement. Such important factors include but may not be limited to: Telia Company's market position; growth in the telecommunications industry; and the effects of competition and other economic, business, competitive and/or regulatory factors affecting the business of Telia Company, its associated companies and joint ventures, and the telecommunications industry in general. Forward-looking statements speak only as of the date they were made, and, other than as required by applicable law, Telia Company undertakes no obligation to update any of them in the light of new information or future events.
Adjustment items: comprise of capital gains and losses, impairment losses, restructuring programs (costs for phasing out operations and personnel redundancy costs and costs for major group wide business transformations) or other costs with the character of not being part of normal daily operations.
Advertising revenues: External net sales related to linear and digital/AVoD media, sponsorships and other types of advertising.
Broadband revenues: External net sales related to fixed broadband services.
Business solutions revenues: External net sales related to fixed business networking and communication solutions.
CAPEX: An abbreviation of "Capital Expenditure". Investments in intangible and tangible non-current assets and right-of-use assets, but excluding goodwill, intangible and tangible non-current assets and right-of-use assets acquired in business combinations, film and program rights and asset retirement obligations.
CAPEX excluding right-of-use assets: CAPEX excluding right-of-use assets.
EBITDA: An abbreviation of "Earnings before Interest, Tax, Depreciation and Amortization." Equals operating income before depreciation, amortization and impairment losses and before income from associated companies and joint ventures but including amortization and impairment of film and program rights.
Employees: Total headcount excluding hourly paid employees.
Free cash flow: The total cash flow from operating activities and cash CAPEX.
Interconnect revenues: External net sales related to mobile termination.
Internal net sales: Group internal net sales.
Like for like (%): The change in net sales, external service revenues and adjusted EBITDA, excluding exchange rate effects and based on the current group structure, i.e. including the impact of any acquired operations and excluding the impact of any disposed operations, both in the current and in the comparable period.
Mobile subscription revenues: External net sales related to voice, messaging, data and content (including machine to machine).
Net debt: Interest-bearing liabilities less derivatives recognized as financial assets (and hedging long-term and short-term borrowings) and related credit support annex (CSA), less 50% of hybrid capital (which, consistent with market practice
for the type of instrument, is treated as equity), less short-term investments, long-term bonds at fair value through income statement and OCI and cash/cash equivalents.
Net debt/adjusted EBITDA ratio (multiple): Net debt divided by adjusted EBITDA rolling 12 months and excluding disposed operations.
Operational free cash flow: Free cash flow from continuing operations excluding cash CAPEX for licenses and spectrum fees, dividends from associated companies net of taxes and including repayment of lease liabilities.
Other fixed service revenues: External net sales of fixed services including fiber installation, wholesale and other infrastructure services.
Other mobile service revenues: External net sales related to visitors' roaming, wholesale and other services.
Return on capital employed: Operating income, including impairments and gains/losses on disposals, plus financial revenues excluding foreign exchange gains expressed as a percentage of average capital employed.
Structural part of Operational free cash flow: Operational free cash flow less contribution from change in working capital.
Telephony revenues: External net sales related to fixed telephony services.
Equipment revenues: External equipment net sales.
Service revenues: External net sales excluding equipment sales.
TV revenues: External net sales related to TV services.
In this report, comparable figures are provided in parentheses and refer to the same item in the corresponding period last year, unless otherwise stated.
Year-end report January-December 2022 January 26, 2023
Annual and Sustainability report 2022 March 13, 2023
Annual general meeting April 5, 2023
Interim report January-March 2023 April 26, 2023
Interim report January-June 2023 July 20, 2023
This information is information that Telia Company AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 07.00 CET on October 21, 2022.
Telia Company AB (publ) Corporate Reg. No. 556103-4249 Registered office: Stockholm Tel. +46 8 504 550 00 www.teliacompany.com
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