Telia Company

Quarterly Report • Jul 21, 2021

Q2 Interim Report January-June 2021

back to growth

Second quarter summary

• Net sales increased 0.5% to SEK 21,877 million (21,770) and like for like3, net sales increased 4.9%.
• Service revenues decreased 1.3% to SEK 18,883 million (19,129) and like for like3, service revenues increased 3.2%.
• Adjusted EBITDA declined 0.1% to SEK 7,731 million (7,737) and like for like3, adjusted EBITDA increased 1.9%.
• Operational free cash flow decreased to SEK 2,057 million (2,202) and cash flow from operating activities was almost equal to last year at 6,245 million (6,267).
• The divestment of Telia Carrier to Polhem Infra was completed on June 1, 2021.
• Total net income increased to SEK 8,104 million (-2,029) mainly due to Telia Carrier capital gain while 2020 was impacted by an impairment of Turkcell Holding.
• An agreement was signed with Brookfield and Alecta for the sale of 49% of the tower businesses in Finland and Norway. The leverage ratio based on Q2 and including the tower proceeds is estimated to be at 2.1x.
• The outlook for 2021 is unchanged.

First half year summary

• Net sales declined 1.1% to SEK 43,691 million (44,197) and like for like3, net sales increased 2.4%.
• Service revenues decreased 3.1% to SEK 37,629 million (38,845) and like for like3, service revenues increased 0.4%.
• Adjusted EBITDA declined 0.3% to SEK 14,977 million (15,014) and like for like3, adjusted EBITDA increased 2.0%.
• Operational free cash flow increased to SEK 6,094 million (5,508) and cash flow from operating activities increased to SEK 13,785 million (13,437).

7,731 Adjusted EBITDA Q2 2021 (SEK million)

18,883 Service revenues Q2 2021 (SEK million)

2,057 Operational free cash flow Q2 2021 (SEK million)

Highlights

SEK in millions, except key ratios,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
per share data and changes	2021	2020	%	2021	2020	%
Net sales	21,877	21,770	0.5	43,691	44,197	-1.1
Change (%) like for like1,3	4.9			2.4
of which service revenues (external) 1	18,883	19,129	-1.3	37,629	38,845	-3.1
change (%) like for like1,3	3.2			0.4
Adjusted² EBITDA1	7,731	7,737	-0.1	14,977	15,014	-0.3
change (%) like for like1,3	1.9			2.0
Margin (%)	35.3	35.5		34.3	34.0
Adjusted² operating income1	2,732	2,939	-7.1	4,953	5,608	-11.7
Operating income	9,067	-946		10,888	1,460
Income after financial items	8,389	-1,873		9,522	-148
Total net income	8,104	-2,029		9,078	-883
EPS total (SEK)	1.97	-0.50		2.21	-0.23
Operational free cash flow1	2,057	2,202	-6.6	6,094	5,508	10.6
CAPEX excluding fees for licenses, spectrum and right-of-use assets1	3,704	3,446	7.5	6,697	6,389	4.8

1) See Note 14 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 companies and excluding the impact of any disposed companies, both in the current and in the comparable period.

CEO COMMENT...

"As we complete the first half of 2021, we return to service revenue growth and continue to deliver EBITDA growth, execute on our strategy, and solidify progress towards our 2021 outlook as well as our long-term ambition. With societies increasingly opening up, I am excited to start meeting both my fellow Telia colleagues and customers across our footprint, in person, to hear first-hand their reflections on our services and products. It is by listening to our customers and acting on their insights that we will reinvent a Better Telia, return to consistent and sustainable growth, while contributing to the digitalization of the societies of the Nordics and the Baltics.

Service revenue grew 3.2% in the quarter reaching SEK 18.9 billion - a significant improvement from the Q1 decline of 2.3% driven primarily by the TV & Media unit but also, most encouragingly, growth in mobile. EBITDA grew 1.9% to SEK 7.7 billion, while operational free cash flow reached SEK 2.1 billion, with SEK 6.1 billion now generated year-to-date.

We continue to be the undisputed market leader in Sweden and the Baltics. In Sweden we saw a broad-based positive development on all leading indicator KPIs such as subscriber base, ARPU, and churn during the quarter, in both the enterprise and consumer segments. Excluding legacy products and one-off items Sweden delivered service revenue growth of 2.0% in the quarter and flat EBITDA, the latter a clear improvement from the 5% decline in Q1. Especially pleasing were the mobile trends, where the enterprise and consumer segments showed mobile subscriber service revenue growth of 2.5% and 2.1%, respectively. The Baltics accelerated prior quarter's strong performance as we saw less roaming headwind, with service revenues growing mid-single digits and EBITDA growing by 12% and 4% in Estonia and Lithuania, respectively.

Among our challenger markets, our Norwegian business continued to grow its mobile customer base within the enterprise segment, and we saw further stabilization of the consumer mobile customer base. Mobile subscriber service revenues grew 2.7% and fixed service revenues also accelerated the growth pace from the previous quarter. Our strong enterprise segment capabilities were highlighted in particular by securing the Norwegian postal service – Telia Norway's largest contract to date - as well as the renewal of our contract with the Norwegian broadcaster NRK. Overall service revenues saw a 1.5% decline due to a negative wholesale impact, with the latter partly masking clear core business progress and improvement from the 3.5% decline in the prior quarter. In Denmark EBITDA was temporarily weak, but the end of the quarter saw a positive turn in trends, underpinned by good progress on KPIs such as underlying subscriber base and churn development. Finland, again, had a tough quarter. Service revenue decline and an unexpectedly high cost-base led to a clearly unsatisfactory EBITDA decline. While we have made progress on simplifying our portfolio by divesting non-core assets, such as the Alerta alarm business, there is a clear need to accelerate network modernization and digitalization to drive improved customer experience and a better brand perception. Concurrently, we continue to review, and have plans to radically reduce, the cost base in the coming months.

TV & Media had another excellent quarter. Our strong market positions in reach and content spurred both Ad and Pay/OTT growth leading to a 45% service revenue increase. Revenue recovery comfortably compensated for higher content costs, with EBITDA growing by SEK 264 million, or 85%. Our market position is further strengthened by increasing commercial share of viewing in both Sweden and Finland and we saw 25% growth in consumption on our advertising-based video on demand platform, in Sweden, clearly demonstrating market share acquisition over other broadcasters' streaming platforms.

Our ambition to reinvent a Better Telia is progressing. Combining world class mobile networks, high speed broadband and highquality content allows us to "Inspire our Customers" in the consumer segment with for example an offering including unlimited 5G mobile data, Netflix and C More – we are one of only five operators globally to bundle Netflix. The launch of EcoRating - enabling consumers to assess the environmental footprint of mobile handsets - together with some of Europe's leading operators, further inspires customers to make more sustainable choices. On the enterprise side, Region Skåne's choice of Telia for all its digital communications' needs for another 12 years – the largest ever contract signed by Telia Sweden – serves as a clear proof point of our depth and strength in providing convergence products to public customers, as does the previously mentioned deal with the Norwegian postal service, which includes pan-Nordic services as well as IoT products.

The modernization of our network and 5G roll-out continues at pace as does our legacy network shutdown. The latter plans always include solutions to ensure no-one is left behind, even in the most remote areas of our footprint. Network quality and leadership is essential to execute on our "Connect Everyone" priority and umlaut's conclusion, among others, that we maintain our network quality leadership in Sweden, also with regards to 5G, is an encouragement of the same. Across our whole footprint we increased population coverage by more than a third. We now offer 5G in 22 cities in Sweden, while in Finland and Norway our 47% and 25% 5G population coverage respectively includes 95% population coverage in the largest cities, and in Estonia we remain the sole 5G provider. The sale of a minority stake of our towers in Finland and Norway - at a full value of EUR 1,524 million on a cash and debt free basis – to experienced tower owners not only crystalizes value but supports further development of our leading infrastructure assets and position.

This quarter saw good progress also in our "Transform to Digital" efforts aimed at transforming customer experience, simplifying the product portfolio, automating processes, increasing usage of data analytics, and removing legacy systems. An extension of our partnership with ServiceNow will further increase the usage of data and analytics, driving acceleration towards becoming a truly customer centric and automated service provider. So far in 2021, we have decommissioned more than 75 legacy systems which resulted in lower IT costs, and we have progressed on our radical reduction of strategic IT suppliers - going from 24 down to 4 – which is expected to make a significant contribution to the overall cost reduction ambition we have until 2025.

Overall market growth is fundamental to "Deliver Sustainably" over the long run. Executing on our "more for more" strategy through convergence, disciplined pricing, and 5G monetization illustrate some of our responsible actions that will help lead the way to restored and sustainable top line growth across our footprint. As we strive to contribute to society and sustainability we were, during the quarter, selected as a European Climate Leader by the Financial Times. Financial sustainability equally progressed with the closing of the Telia Carrier transaction and announcement of our tower partnership, leading to an even stronger balance sheet and overall financial position.

Based on the performance in the quarter we reiterate our full year outlook of service revenues and EBITDA, excluding Telia Carrier and FX, at flat to low single digit growth, while cash CAPEX is expected to be in the range of SEK 14.5 to 15.5 billion, and cash generation sufficient to cover our minimum dividend level of SEK 2 per share.

Finally, I would like to thank all my Telia colleagues for their hard work and commitment to date. I look forward to the second half of 2021 and to us continuing to reinvent better together, for the benefit of our customers, employees, shareholders, and societies."

Allison Kirkby President & CEO

In Comments by the President & CEO, 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.

Outlook for 2021

Service revenues, in constant currency and excluding Telia Carrier, is expected to be flat or grow by low single digit.

Adjusted EBITDA, in constant currency and excluding Telia Carrier, is expected to be flat or grow by low single digit.

Cash CAPEX, excluding Telia Carrier and fees for licenses and spectrum, is expected to be in the range of SEK 14.5-15.5 billion.

Ambition for 2021-2023

Service revenues, in constant currency and excluding Telia Carrier, is expected to grow by low single digit.

Adjusted EBITDA, in constant currency and excluding Telia Carrier, is expected to grow by low to mid-single digit.

Cash CAPEX to net sales, excluding Telia Carrier and fees for licenses and spectrum is expected to return to around 15% by 2023.

Leverage and credit rating target

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+.

Dividend policy

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.

The operational free cash flow is expected to cover the minimum level throughout the 2021-2023 period.

The structural part1 of operational free cash flow is expected to cover the minimum level of dividend from 2022.

Ordinary dividend to shareholders

For 2020, the Annual General Meeting (AGM) decided on an ordinary dividend of SEK 2.00 per share (2.45), totaling SEK 8.2 billion (10.0). The dividend should be split and distributed into two tranches of SEK 1.00 per share and SEK 1.00 per share, respectively.

First distribution

The Annual General Meeting (AGM) decided that the first distribution of the dividend was to be distributed by Euroclear Sweden on April 19, 2021.

Second distribution

The Annual General Meeting (AGM) decided that the final day for trading in shares entitling shareholders to dividend should be set for October 26, 2021, and that the first day of trading in shares excluding rights to dividend should be set for October 27, 2021.

The record date at Euroclear Sweden for the right to receive dividend will be October 28, 2021. The dividend is expected to be distributed by Euroclear Sweden on November 2, 2021.

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.

Review of the group, second quarter 2021

Sales and earnings

Net sales increased by 0.5% to SEK 21,877 million (21,770). Like for like, net sales increased by 4.9% driven by the TV and Media unit, Sweden as well as in the Baltic operations.

Service revenues decreased 1.3% to SEK 18,883 million (19,129). Like for like, service revenues increased 3.2% driven by the TV and Media unit as well as in the Baltic operations.

Adjusted EBITDA declined 0.1% to SEK 7,731 million (7,737) and the adjusted EBITDA margin declined to 35.3% (35.5). Like for like, adjusted EBITDA increased 1.9% driven by the TV and Media unit as well as the Baltic operations.

Adjustment items affecting operating income amounted to SEK 6,335 million (-3,885). 2021 was mainly impacted by a capital gain from the disposal of Telia Carrier, see Note 12. 2020 was impacted by an impairment related to Turkcell Holding. See Note 2.

Adjusted operating income declined to SEK 2,732 million (2,939).

Financial items totaled SEK -678 million (-927) of which SEK -663 million (-799) related to net interest expenses.

Income taxes amounted to SEK -460 million (-156). The effective tax rate was 5.5% (-8.3). The effective tax rate was mainly impacted by a non-taxable capital gain related to the disposal of Telia Carrier whilst comparative figures were mainly impacted by a reversal of a withholding tax provision on future dividends and a non-deductible impairment related to Turkcell Holding.

Total net income amounted to SEK 8,104 million (-2,029). 2021 was impacted by a capital gain from the disposal of Telia Carrier while 2020 was impacted by an impairment related to Turkcell Holding.

Other comprehensive income increased to SEK -453 million (-5,728), mainly due to positive remeasurements of the defined benefit pension plans and lower negative translation differences.

Cash flow

Cash flow from operating activities decreased to SEK 6,245 million (6,267) and Free cash flow increased to 2,769 million (2,745).

Operational free cash flow, from continuing operations, amounted to SEK 2,057 million (2,202).

Cash flow from investing activities increased to SEK 4,136 million (-1,493) positively impacted by the disposal of Telia Carrier partly offset by net investments in short term investment bonds.

Cash flow from financing activities amounted to SEK -6,116 million (-5,862).

Financial position

CAPEX excluding right-of-use assets, increased to SEK 4,064 million (3,591). CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased to SEK 3,704 million (3,446). Cash CAPEX decreased to SEK 3,476 million (3,522).

Net debt was SEK 69,224 million at the end of the second quarter (77,228 at the end of the first quarter of 2021). The net debt/adjusted EBITDA ratio was 2.32x. The leverage ratio based on the second quarter and including also the proceeds from the tower business is estimated to be at 2.1x. See Note 14.

COVID-19 impact

In the second quarter 2021 the COVID-19 pandemic continued to have a negative impact on service revenues relating to roaming. Roaming revenues are around SEK 50 million lower in the second quarter and around SEK 300 million lower in the first half year 2021 compared to the corresponding periods last year. The uncertainty surrounding COVID-19 implies a risk also going forward. This, as well as mitigating activities, are reflected in the outlook, see page 5.

Financial markets have normalized after a strong rebound from lows during the COVID-19 shock in the second quarter 2020. Telia Company's financial risk management is in all material aspects unchanged but with additional focus to maintain a continued strong liquidity position. Also, the debt capital market has rebounded and returned to pre COVID-19 spread levels to the Telia Company credit. The refinancing need for 12 months ahead remains limited. The general credit risk increase in 2020 has decreased and there has been no need for any significant increases in Telia Company's allowances for expected credit losses in the second quarter 2021. For more information on risks related to COVID-19, see "Risks and uncertainties" in the Annual and sustainability report 2020.

Review of the group, first half year 2021

Sales and earnings

Net sales decreased by 1.1% to SEK 43,691 million (44,197). Like for like, net sales increased 2.4% driven by the TV and Media unit, Sweden and the Baltic operations.

Service revenues decreased 3.1% to SEK 37,629 million (38,845). Like for like, service revenues increased 0.4% driven by the TV and Media unit and the Baltic operations.

Adjusted EBITDA declined 0.3% to SEK 14,977 million (15,014) and the adjusted EBITDA margin increased to 34.3% (34.0). Like for like, adjusted EBITDA increased 2.0% driven by a positive development in Norway, the Baltic operations and the TV and Media unit.

Adjustment items affecting operating income amounted to SEK 5,935 million (-4,148). 2021 was mainly impacted by a capital gain from the disposal of Telia Carrier, see Note 12. 2020 was impacted by an impairment related to Turkcell Holding. See Note 2.

Adjusted operating income declined to SEK 4,953 million (5,608).

Financial items totaled SEK -1,366 million (-1,608) of which SEK -1,369 million (-1,537) related to net interest expenses.

Income taxes amounted to SEK -619 million (-536). The effective tax rate was 6.5% (-363%). The effective tax rate was mainly impacted by a non-taxable capital gain related to the disposal of Telia Carrier whilst comparative figures were mainly impacted by a reversal of a withholding tax provision on future dividends and a non-deductible impairment related to Turkcell Holding.

Total net income amounted to SEK 9,078 million (-883). 2021 was mainly impacted by a capital gain from the disposal of Telia Carrier, see Note 12. 2020 was impacted by an impairment related to Turkcell Holding.

Other comprehensive income increased to SEK 5,193 million (-5,669), mainly due to positive remeasurements of defined benefit pension plans and positive translation differences related to NOK and no TRY impact in 2021.

Cash flow

Cash flow from operating activities increased to SEK 13,785 million (13,437) and Free cash flow decreased to 6,618 million (6,962).

Operational free cash flow, from continuing operations, increased to SEK 6,094 million (5,508) mainly driven by changes in working capital partly offset by paid taxes.

Cash flow from investing activities decreased to SEK -1,540 million (-78) negatively impacted by net investments in short-term investment bonds and higher cash CAPEX related to licenses, partly offset by the disposal of Telia Carrier.

Cash flow from financing activities amounted to SEK -7,668 million (-9,661). 2020 was mainly impacted by net repayments of short-term borrowings and higher repurchased treasury shares partly offset by settlement of derivatives.

Financial position

CAPEX excluding right-of-use assets, increased to SEK 7,818 million (6,534). CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased to SEK 6,697 million (6,389). Cash CAPEX increased to SEK 7,167 million (6,470).

Goodwill and other intangible assets increased to SEK 88,296 million (86,521), mainly due to foreign exchange rate effects.

Long-term interest-bearing receivables decreased to SEK 8,730 million (11,233), mainly due to a change in derivatives.

Short-term interest-bearing receivables increased to SEK 9,112 million (5,486), mainly due to investment in investment bonds.

Assets classified as held for sale decreased to SEK 0 million (4,957) due to the disposal of Telia Carrier, also affecting Liabilities directly associated with assets classified as held for sale.

Long-term borrowings decreased to SEK 93,551 million (100,239) mainly due to a reclassification to Short-term borrowings, but also due to a change in derivatives.

Provisions for pensions and other long-term provisions decreased to SEK 7,904 million (11,787) mainly due to remeasurements of defined benefit pension plans.

Trade payables and other current liabilities, current tax payables and short-term provisions increased to SEK 33,297 million (28,430) mainly due to the second dividend tranche not yet paid out.

COVID-19 impact first half year

For information on COVID-19, see "Review of the Group, second quarter 2021".

Significant events in the first quarter

• On January 19, 2021 it was announced that Telia Company secured a 120 MHz frequency block in the 3.5 GHz band in Sweden for EUR 75 million (approximately SEK 757 million).
• On February 11, 2021, it was announced that the Nomination Committee had been informed by Mr Olaf Swantee that he was not available for re-election to the Telia Company Board.
• On March 11, 2021, Telia Company published its Annual and Sustainability Report for 2020.
• On March 26, 2021, Telia Company announced the investment of SEK 100 million in a Sustainable Development Bond recently launched by the World Bank.

Significant events in the second quarter

• On April 1, 2021 Telia Company completed the sale of its alarm communication business Alerta in Finland. See Note 12.
• On April 12, 2021 Telia Company announced the resolutions passed at the Annual General Meeting, including the appointment of the new board. Further the Annual General Meeting approved implementation of a long-term incentive program 2021/2024.
• On April 20, 2021 Telia Company launched new goals to boost sustainable growth. The aim is to empower societies in the Nordics and Baltics to achieve zero CO2 and waste by 2030, reach one million people through digital inclusion initiatives by 2025 and implement winning privacy and security strategies by 2023 to gain and maintain customers' trust.
• On April 21, 2021 the Danish multiband auction was concluded and Telia Denmark secured via the joint operation TT-Netværket spectrum in the 1,500 MHz, 2,100MHz, 3,600MHz as well as in the 26GHz band, for a total price of DKK 741 million (approximately SEK 1 000 million).
• On May 3, 2021 Telia Company announced that the Board of Directors has decided to exercise the mandate for buy-back of shares to cover commitments under Telia Company's "Long Term Incentive Program 2018/2021". See Note 6.
• On June 1, 2021 the divestment of Telia Carrier to Polhem Infra was completed. See Note 12.
• On June 4, 2021 Telia Company announced that Cecilia Lundin, Executive Vice President, Head of People Experience & Culture, will be leaving Telia Company.
• On June 30, 2021 Telia Company signed an agreement to dispose 49% of the tower businesses in Finland and Norway to Brookfield and Alecta, at a price corresponding to an enterprise value for 100% of EUR 1,524 million (approximately SEK 15.4 billion) on a cash and debt free basis. The transaction is subject to customary regulatory approvals and closing is expected take place in the fourth quarter of 2021. See Note 12.

Significant events after the end of the second quarter

• On July 12, 2021 Telia Company announced the appointment of Stefan Backman as EVP, Group General Counsel, Head of Corporate Affairs, to succeed Jonas Bengtsson who has decided to leave the company at the end of 2021.

SWEDEN

• According to umlaut´s first 5G benchmark in Stockholm, Telia came out as a clear leader. Furthermore Telia´s network leadership position was again confirmed by other independent network surveys.
• Telia launched a new, and for the Swedish market, unique mobile offering which combines unlimited data and the highly popular streaming services of Netflix and C More with Telia's superior network. The offering also includes ultra-fast 5G, currently available in over 20 cities across Sweden. This is an important milestone when it comes to Telia's strategic ambition to provide the best digital customer experiences combined with the best network experience.
• Telia secured in the quarter a continuation of its current contract with Region Skåne. The new contract has a duration of up to 12

years and a total contractual value of up to almost SEK 4 billion and contains multiple services including connectivity, security, call center services as well as various services provided by our subsidiary Cygate. In addition, Telia will also ensure a gradual transfer of communication solutions based on 2G/3G to 4G/5G as well as provide new services, such as real-time positioning, to support Region Skåne on its digitalization journey.

• Last year Zinkgruvan Mining became the first customer to deploy a dedicated Enterprise Mobile Network delivered as a service. Telia has now assisted the company in taking another important step on its digitalization journey by connecting a remotecontrolled drilling rig to the network. This is to improve both efficiency in the mining operations as well as the working environment.

Highlights

SEK in millions, except margins,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
operational data and changes	2021	2020	%	2021	2020	%
Net sales1	8,492	8,351	1.7	16,893	16,673	1.3
Change (%) like for like	1.7			1.3
of which service revenues (external)	7,336	7,469	-1.8	14,568	14,903	-2.2
change (%) like for like	-1.8			-2.3
Adjusted EBITDA	3,308	3,316	-0.2	6,544	6,714	-2.5
Margin (%)	39.0	39.7		38.7	40.3
change (%) like for like	-0.2			-2.5
Adjusted operating income	1,358	1,604	-15.3	2,708	3,328	-18.6
Operating income	1,345	1,555	-13.5	2,582	3,224	-19.9
CAPEX excluding fees for licenses,
spectrum and right-of-use assets	731	701	4.2	1,286	1,324	-2.9
Subscriptions, (thousands)
Mobile	6,418	6,100	5.2	6,418	6,100	5.2
of which machine to machine
(postpaid)	1,560	1,167	33.7	1,560	1,167	33.7
Fixed telephony	577	779	-25.9	577	779	-25.9
Broadband	1,226	1,266	-3.2	1,226	1,266	-3.2
TV	949	901	5.3	949	901	5.3
Employees1	4,429	4,518	-2.0	4,429	4,518	-2.0

1) Second quarter and first half 2020 are restated for comparability see Note 1.

Net sales increased 1.7% to SEK 8,492 million (8,351) as higher equipment sales more than offset lower service revenues.

Service revenues, like for like, decreased by 1.8% as mobile revenues declined by 0.9% at the same time as fixed revenues declined by 2.5%. The latter was primarily driven by lower revenues from fixed telephony and business solutions which together more than offset a strong development for TV and fiber revenues.

Adjusted EBITDA declined 0.2% to SEK 3,308 million (3,316) and adjusted EBITDA margin decreased to 39.0% (39.7). Adjusted EBITDA like for like declined 0.2% as a 4.1% reduction in operational expenses could not fully offset the negative impact from lower service revenues.

CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 4.2% to SEK 731 million (701).

Mobile subscriptions grew by 126,000 in the quarter as an addition of 134,000 postpaid subscriptions used for machine-to-machine related services compensated for the loss of a public sector contract. Fixed broadband subscriptions declined by 10,000 and TV subscriptions increased by 14,000 in the quarter.

FINLAND

• Telia took an important step on its 5G deployment when base stations operating on the super high frequency band 26 GHz was implemented. This resulted in speeds of 4.1 Gbit per second and a latency of well below 10 milliseconds near a base station in eastern Helsinki.
• Together with its partners Digita and Nokia, Telia has assisted the cargo handling company Kalmar in deploying a new stand-alone 5G network for its Technology and Competence centre in Tampere. The 5G network implemented will facilitate the development of integrated solutions for product development and

cargo handling technologies and is one of the first and most extensive implementations of its kind in the world.

• The Government ICT Centre Valtori selected Telia to build and renew the Finnish central government's backbone network service to meet government agencies different future needs. Telia has been a supplier for the network since 2009, and the new significant contract covers the next 10 years.
• An agreement was signed regarding the sale of 49% of the tower business in Finland to Brookfield and Alecta. The transaction is expected to be finalized in the fourth quarter of 2021. See Note 12.

Highlights

SEK in millions, except margins,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
operational data and changes	2021	2020	%	2021	2020	%
Net sales	3,549	3,769	-5.9	7,090	7,666	-7.5
Change (%) like for like	-0.5			-2.4
of which service revenues (external)	3,017	3,233	-6.7	6,008	6,534	-8.1
change (%) like for like	-1.6			-3.1
Adjusted EBITDA	1,046	1,223	-14.5	2,116	2,379	-11.0
Margin (%)	29.5	32.4		29.8	31.0
change (%) like for like	-9.1			-5.9
Adjusted operating income	218	395	-44.8	470	747	-37.1
Operating income	515	358	43.8	752	602	24.8
CAPEX excluding fees for licenses,
spectrum and right-of-use assets1	435	478	-9.0	779	749	3.9
Subscriptions, (thousands)
Mobile	3,195	3,167	0.9	3,195	3,167	0.9
of which machine to machine
(postpaid)	290	270	7.3	290	270	7.3
Fixed telephony	18	22	-18.2	18	22	-18.2
Broadband	470	454	3.5	470	454	3.5
TV	610	578	5.5	610	578	5.5
Employees1	3,070	3,156	-2.7	3,070	3,156	-2.7

1) Second quarter and first half 2020 are restated for comparability see Note 1.

Net sales declined 5.9% to SEK 3,549 million (3,769) and like for like, net sales declined 0.5% driven by lower service revenues. The effect of exchange rate fluctuations was negative by 4.8%.

Service revenues, like for like, declined 1.6% explained by mobile revenues decreasing 2.2% while fixed revenues remained fairly unchanged. The decline in mobile revenues was due to a lower ARPU.

Adjusted EBITDA declined 14.5% to SEK 1,046 million (1,223) and adjusted EBITDA margin decreased to 29.5% (32.4). Adjusted EBITDA like for like declined 9.1% driven by the decline in service revenues as well as an increased cost level in the quarter.

CAPEX excluding fees for licenses, spectrum and right-of-use assets, decreased 9.0% to SEK 435 million (478).

Mobile subscriptions increased by 40,000 driven by the net addition of 40,000 postpaid subscriptions. TV subscriptions increased by 20,000 and fixed broadband subscriptions remained unchanged in the quarter.

The alarm communication business Alerta, previously part of Telia Finland, was divested on April 1, 2021. See note 12.

NORWAY

• The 5G roll-out continued during the quarter in full force, and currently around 1.3 million Norwegians have access to Telia's 5G network and is on track to cover half of the population by yearend. In 2023 our ambition is to be the first operator to have nationwide 5G coverage in Norway. The interest in 5G is also increasing amongst customers and currently eight of the ten most sold mobile phones support 5G, and Telia now has more than 300,000 phones supporting 5G on its network. The 5G roll-out has also supported a continued positive momentum for the consumer subscriber base, driven by reduced churn and strong traction for the Telia's unlimited offering, Telia X.
• In the quarter Telia secured its largest contract ever when signing a multiyear agreement with the Norwegian postal services (Posten). Under the agreement Telia will in addition to deliver 15,000 mobile subscriptions also provide a wide range of

connectivity and ICT services such as WAN-connectivity, FWA based on 4G/5G, security services and also an option for SMSgateway and contact center services. Telia will also provide a number of different services around IoT to support Posten on its ambitions around digitalization.

• After Telia Enterprise secured an agreement with the Ministry of Foreign Affairs in March regarding communication for some 30 Norwegian embassies around the world, work to ensure the best possible customer transition was intense in the quarter. Under the agreement, Telia is to provide an encrypted and secure network for embassy civil servants to use when communicating with the HQ in Oslo.
• An agreement was signed regarding the sale of 49% of the tower business in Norway to Brookfield and Alecta. The transaction is expected to be finalized in the fourth quarter of 2021. See Note 12.

Highlights

SEK in millions, except margins,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
operational data and changes	2021	2020	%	2021	2020	%
Net sales	3,343	3,229	3.5	6,652	6,658	-0.1
Change (%) like for like	-0.4			-0.1
of which service revenues (external)	2,827	2,760	2.4	5,583	5,724	-2.5
change (%) like for like	-1.5			-2.5
Adjusted EBITDA	1,530	1,510	1.3	3,073	2,898	6.0
Margin (%)	45.8	46.8		46.2	43.5
change (%) like for like	-2.9			5.7
Adjusted operating income	543	407	33.4	1,052	639	64.6
Operating income	530	371	42.7	971	568	70.8
CAPEX excluding fees for licenses,
spectrum and right-of-use assets	748	520	43.9	1,334	978	36.3
Subscriptions, (thousands)
Mobile	2,277	2,265	0.5	2,277	2,265	0.5
of which machine to machine
(postpaid)	124	95	29.6	124	95	29.6
Fixed telephony	35	44	-20.5	35	44	-20.5
Broadband	483	460	5.0	483	460	5.0
TV	477	475	0.4	477	475	0.4
Employees	1,492	1,629	-8.4	1,492	1,629	-8.4

Net sales increased 3.5% to SEK 3,343 million (3,229) and like for like, net sales decreased 0.4% due to lower service revenues. The effect of exchange rate fluctuations was positive by 3.9%.

Service revenues, like for like, decreased 1.5% due to 2.0% lower mobile revenues explained by lower wholesale revenues. Fixed revenues increased by 0.8% as growing broadband revenues more than compensated for lower revenues from mainly fixed telephony and business solutions.

Adjusted EBITDA increased 1.3% to SEK 1,530 million (1,510) and adjusted EBITDA margin declined to 45.8% (46.8). Adjusted EBITDA like for like declined 2.9% as a result from service revenues declining.

CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 43.9% to SEK 748 million (520) mainly due to network modernization.

Mobile subscriptions increased by 15,000 in the quarter as a gain of 22,000 postpaid subscription more than compensated for a loss of 7,000 prepaid subscriptions. TV subscriptions increased by 9,000 and fixed broadband subscriptions increased by 3,000 in the quarter.

DENMARK

• Telia and Telenor continued together with our network partner Nokia, to modernize our common 4G network and also deploy 5G in Denmark's four largest cities. In June the roll-out reached an important milestone after going live on the 3.5 GHz band. The network upgrade and expansion will continue at a high pace to meet the ambition for the vast majority of all people in Denmark to have access to ultra-fast 5G during 2022.
• By signing a new agreement with TDC regarding fiber infrastructure access, Telia continued towards its ambition to strengthen its position in the consumer segment and be the natural choice for families in Denmark. Both when it comes to mobile, broadband, TV as well as streaming services. Through the new agreement, Telia will expand its fiber coverage by more than 225,000 households, bringing the total fiber coverage to over 500,000 households. This also enables total broadband coverage, via fiber or COAX, to around 1.5 million households.

Highlights

SEK in millions, except margins,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
operational data and changes	2021	2020	%	2021	2020	%
Net sales	1,242	1,324	-6.2	2,523	2,754	-8.4
Change (%) like for like	-1.7			-3.9
of which service revenues (external)	937	992	-5.5	1,858	2,045	-9.1
change (%) like for like	-1.2			-4.8
Adjusted EBITDA	221	255	-13.4	436	486	-10.2
Margin (%)	17.8	19.2		17.3	17.7
change (%) like for like	-8.1			-4.5
Adjusted operating income	-16	-1		-53	-18	196.5
Operating income	-28	-14	100.1	-79	-31	157.5
CAPEX excluding fees for licenses,
spectrum and right-of-use assets	84	73	16.3	127	165	-22.9
Subscriptions, (thousands)
Mobile	1,542	1,472	4.8	1,542	1,472	4.8
of which machine to machine
(postpaid)	185	93	98.7	185	93	98.7
Fixed telephony	63	74	-14.9	63	74	-14.9
Broadband	65	75	-13.3	65	75	-13.3
TV	26	33	-21.2	26	33	-21.2
Employees	718	727	-1.2	718	727	-1.2

Net sales decreased 6.2% to SEK 1,242 million (1,324) and like for like, net sales declined 1.7% driven by lower service revenues. The effect of exchange rate fluctuations was negative by 4.5%.

Service revenues, like for like, decreased 1.2% as mobile revenue growth of 2.1% could not compensate for a 13.0% decline in fixed revenues. The growth in mobile revenues was primarily attributable to an increased number of subscriptions whereas the lower fixed revenues was driven by declining revenues from fixed telephony and business solutions.

Adjusted EBITDA declined 13.4% to SEK 221 million (255) and adjusted EBITDA margin decreased to 17.8% (19.2). Adjusted EBITDA like for like declined 8.1% driven mainly by the decrease in service revenues.

CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 16.3% to SEK 84 million (73).

Mobile subscriptions increased by 46,000 in the quarter as the addition of 65,000 postpaid subscriptions used for machine-tomachine related services more than mitigated for the loss of an enterprise partner. Fixed broadband subscriptions declined by 1,000 and TV subscriptions declined by 3,000 in the quarter.

LITHUANIA

• The importance of high-quality connectivity remained high in the quarter supported by continued COVID-19 related lockdowns. As a result, demand for reliable high-speed connectivity as well as for entertainment was strong, and as a response to the increased customer preference for video-on-demand, Telia's already appreciated content library was further strengthened. Telia also continued to be in the forefront of innovation by launching new esim solutions for smart watches. And currently Telia is the only operator in Lithuania to offer e-sim for Apple watches.
• In order to improve customer experience, the customer care organization was restructured into one part with focus on driving

sales results and one part dedicated to improving efficiency and provide superior customer care.

• Telia launched, for the first time a TV campaign dedicated to new and tailored offerings for SOHO and SME customers. This in combination with an increased sales focus targeting newly established businesses resulted in Telia, in the SOHO/SME segment, grew the subscriber base in all three months of the quarter.

Highlights

SEK in millions, except margins,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
operational data and changes	2021	2020	%	2021	2020	%
Net sales	1,052	1,047	0.5	2,051	2,043	0.4
Change (%) like for like	5.6			5.7
of which service revenues (external)	811	804	0.8	1,591	1,599	-0.5
change (%) like for like	5.5			4.5
Adjusted EBITDA	370	375	-1.3	738	748	-1.3
Margin (%)	35.2	35.8		36.0	36.6
change (%) like for like	3.7			3.9
Adjusted operating income	185	216	-14.3	360	432	-16.6
Operating income	184	207	-11.2	368	421	-12.6
CAPEX excluding fees for licenses,
spectrum and right-of-use assets1	126	98	28.5	190	181	5.1
Subscriptions, (thousands)
Mobile	1,409	1,354	4.1	1,409	1,354	4.1
of which machine to machine
(postpaid)	225	187	20.5	225	187	20.5
Fixed telephony	215	244	-11.9	215	244	-11.9
Broadband	417	414	0.7	417	414	0.7
TV	254	249	2.0	254	249	2.0
Employees1	1,600	1,711	-6.5	1,600	1,711	-6.5

1) Second quarter and first half 2020 are restated for comparability see Note 1.

Net sales increased 0.5% to SEK 1,052 million (1,047) and like for like, net sales increased 5.6% driven partly by increased equipment sales but mainly increased service revenues. The effect of exchange rate fluctuations was negative by 5.1%.

Service revenues, like for like, increased 5.5% supported by a solid development for both mobile and fixed revenues. For mobile revenues, which increased 5.2%, the growth was driven by a higher ARPU coupled with also a growing subscription base, whereas fixed revenues increased 5.9% driven by a positive development across most fixed services.

Adjusted EBITDA declined 1.3% to SEK 370 million (375) and adjusted EBITDA margin decreased to 35.2% (35.8). Adjusted EBITDA like for like increased 3.7% as a result of the increase in service revenues.

CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 28.5% to SEK 126 million (98).

Mobile subscriptions increased by 25,000 in the quarter driven by 20,000 postpaid subscriptions. Fixed broadband subscriptions decreased by 1,000 and TV subscriptions increased by 1,000 in the quarter.

ESTONIA

• Despite continued delays in the 3.6 GHz frequency auction Telia made steady progress on its 5G network expansion, and by the end of the quarter achieved almost 80 active 5G sites across the country using dynamic spectrum sharing.
• In cooperation with the tech company, Cleveron, Telia launched in the quarter a unique and innovative self-service capsule in Tartu. The initial customer response was very positive, and the capsule had around 3,000 visits in the first 1.5 months. Looking further ahead, more capsules are planned to be installed across the

country to improve regional availability of services and support, and at the same time also enable better connected living for Telia's customers.

• Telia signed important contracts around cyber security with one of the largest industrial groups in the region, BLRT, as well as with the State Infosystems Authority. And in addition, Telia also won a Smart City tender with the city of Tallinn. Together great proof points that customers highly appreciate Telia's wide range of security and digital services.

Highlights

SEK in millions, except margins,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
operational data and changes	2021	2020	%	2021	2020	%
Net sales1	826	796	3.8	1,604	1,621	-1.0
Change (%) like for like	9.1			4.2
of which service revenues (external)	665	655	1.6	1,307	1,335	-2.1
change (%) like for like	6.1			2.8
Adjusted EBITDA	299	281	6.6	591	571	3.5
Margin (%)	36.2	35.2		36.8	35.2
change (%) like for like	12.0			8.9
Adjusted operating income	139	103	34.6	269	211	27.7
Operating income	138	102	35.5	265	208	27.1
CAPEX excluding fees for licenses,
spectrum and right-of-use assets1	95	94	0.5	147	180	-18.1
Subscriptions, (thousands)
Mobile	1,151	1,080	6.6	1,151	1,080	6.6
of which machine to machine
(postpaid)	375	324	15.8	375	324	15.8
Fixed telephony	218	234	-6.8	218	234	-6.8
Broadband	242	242	0.0	242	242	0.0
TV	207	209	-1.0	207	209	-1.0
Employees1	1,302	1,414	-7.9	1,302	1,414	-7.9

1) Second quarter and first half 2020 are restated for comparability see Note 1.

Net sales increased 3.8% to SEK 826 million (796) and like for like, net sales increased 9.1% as both service revenues as well as equipment sales increased. The effect of exchange rate fluctuations was negative by 5.3%.

Service revenues, like for like, increased 6.1% partly from mobile revenues increasing by 1.9% due to subscription base growth, although mainly due to fixed revenues increasing by 8.8% driven by a positive development for most fixed services.

Adjusted EBITDA increased 6.6% to SEK 299 million (281) and adjusted EBITDA margin increased to 36.2% (35.2). Adjusted EBITDA like for like increased 12.0% driven by the service revenue increase.

CAPEX excluding fees for licenses, spectrum and right-of-use assets, increased 0.5% to SEK 95 million (94).

Mobile subscriptions increased by 28,000 in the quarter driven partly by the net addition of 18,000 postpaid subscriptions used for machineto-machine related services. Fixed broadband as well as TV subscriptions remained unchanged in the quarter.

TV AND MEDIA

• The financial development for TV and Media continued to improve in the quarter with both advertising and TV revenues showing impressive growth rates. Furthermore, the strong development for digital consumption and share of viewing on linear TV also continued in the quarter. For digital consumption the time spent on TV4 Play increased by 24.6% compared to the second quarter of last year. And at the same time the linear portfolio of TV4 increased its share of viewing amongst the ages 15-64 to 35.1% compared to 33.7% in the corresponding quarter of last year.
• C More signed an extension of the Italian Serie A football rights until 2024 in both Sweden and Finland. Something that together with other highly popular sports rights such as the UEFA Champions League, Spanish La Liga and the FIFA World Cup 2022 makes the C More portfolio a natural first choice for Swedish and Finnish football fans.

Highlights

SEK in millions, except margins,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
operational data and changes	2021	2020	%	2021	2020	%
Net sales1	2,271	1,583	43.5	4,175	3,457	20.8
Change (%) like for like	45.1
of which service revenues (external)	2,271	1,582	43.5	4,175	3,456	20.8
change (%) like for like	45.1
Adjusted EBITDA	575	311	84.7	695	310	124.1
Margin (%)	25.3	19.7		16.6	8.9
change (%) like for like	84.7
Adjusted operating income	371	120	209.4	286	-75
Operating income	322	94	241.4	216	-106
CAPEX excluding fees for licenses,
spectrum and right-of-use assets1	77	95	-19.5	132	174	-23.7
Subscriptions, (thousands)
TV (SVOD)	788	593	32.9	788	593	32.9
Employees1	1,415	1,434	-1.3	1,415	1,434	-1.3

1) Second quarter and first half 2020 are restated for comparability see Note 1.

Net sales increased 43.5% to SEK 2,271 million (1,583) and like for like, net sales increased 45.1% driven by increased service revenues. The effect of exchange rate fluctuations was negative by 1.6%.

Service revenues, like for like, increased 45.1% explained by a 57.7% increase in TV revenues and a 42.9% increase in advertising revenues. The growth in TV revenues was explained by an increased number of TV subscriptions in combination with corresponding quarter last year, which contained a negative impact from the cancellation of sport events during the pandemic. Also advertising revenues had an easy comparison as the corresponding quarter of last year included a significant adverse impact from the pandemic. However, the growth was also driven by successful work on capitalizing on a strong recovery when it comes to the demand for tv-advertising.

Adjusted EBITDA increased 84.7% to SEK 575 million (311) and adjusted EBITDA margin increased to 25.3% (19.7). Adjusted EBITDA like for like increased 84.7% as increased service revenues more than compensated for higher content related costs.

CAPEX excluding fees for licenses, spectrum and right-of-use assets, declined 19.5% to SEK 77 million (95).

Direct subscriptions video-on-demand (SVOD) increased by 24,000 in the quarter.

OTHER OPERATIONS

Highlights

SEK in millions, except margins,	Apr-Jun	Apr-Jun	Chg	Jan-Jun	Jan-Jun	Chg
operational data and changes	2021	2020	%	2021	2020	%
Net sales	1,576	2,204	-28.5	3,720	4,450	-16.4
Change (%) like for like	11.1			7.6
of which Telia Carrier	683	1,373	-50.2	1,944	2,733	-28.9
of which Latvia	603	555	8.6	1,211	1,161	4.3
Adjusted EBITDA	382	467	-18.2	785	910	-13.7
of which Telia Carrier	156	243	-35.9	371	471	-21.4
of which Latvia	192	175	9.7	389	374	4.0
Margin (%)	24.3	21.2		21.1	20.4
Income from associated companies	24	-3,163		50	-2,763
of which Turkey	–	-3,207	-100.0	–	-2,851	-100.0
of which Latvia	28	45	-38.5	56	91	-38.6
Adjusted operating income	-68	96		-140	343
Operating income	6,060	-3,619		5,814	-3,428
CAPEX excluding fees for licenses,
spectrum and right-of-use assets1	1,409	1,387	1.6	2,700	2,638	2.4
Subscriptions, (thousands)
Mobile Latvia	1,327	1,289	2.9	1,327	1,289	2.9
of which machine to machine
(postpaid)	365	327	11.6	365	327	11.6
Employees1	5,941	6,392	-7.1	5,941	6,392	-7.1

1) Second quarter and first half 2020 are restated for comparability see Note 1.

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. See Note 12.

Net sales declined 28.5% to SEK 1,576 million (2,204) and like for like, net sales increased 11.1%. The effect of exchange rate fluctuations was negative by 3.5%.

Adjusted EBITDA declined 18.2% to SEK 382 million (467) and adjusted EBITDA margin increased to 24.3% (21.2). Adjusted EBITDA like for like increased 3.6%.

In Telia Carrier, net sales declined 50.2% to SEK 683 million (1,373). Adjusted EBITDA declined 35.9% to SEK 156 million (243) and adjusted EBITDA margin increased to 22.8% (17.7). Both net sales as well as adjusted EBITDA are impacted by the deconsolidation of the Telia Carrier business.

In Latvia, net sales increased 8.6% to SEK 603 million (555). Adjusted EBITDA increased 9.7% to SEK 192 million (175) and the adjusted EBITDA margin increased to 31.9% (31.5). Adjusted EBITDA like for like increased 15.3%. The number of mobile subscriptions increased by 6,000 in the quarter driven by the addition of 4,000 postpaid subscriptions used for machine-to-machine related services.

Income from associated companies increased to SEK 24 million (-3,163) as the corresponding quarter of last year contained an impairment related to Turkcell Holding.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

SEK in millions, except per share data and number of shares	Note	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Continuing operations
Net sales
Cost of sales	3, 4	21,877	21,770	43,691	44,197
Gross profit		-13,944	-13,818	-28,399	-28,276
		7,933	7,952	15,292	15,920
Selling, administration and R&D expenses		-5,468	-5,484	-10,729	-11,091
Other operating income and expenses, net		6,578	-236	6,278	-591
Income from associated companies and joint ventures		23	-3,178	47	-2,778
Operating income	3	9,067	-946	10,888	1,460
Financial items, net		-678	-927	-1,366	-1,608
Income after financial items	3	8,389	-1,873	9,522	-148
Income taxes		-460	-156	-619	-536
Net income from continuing operations		7,929	-2,029	8,903	-684
Discontinued operations
Net income from discontinued operations	12	176	–	176	-199
Total net income		8,104	-2,029	9,078	-883
Items that may be reclassified to net income:
Foreign currency translation differences from continuing operations		-922	-2,961	1,698	-4,179
Foreign currency translation differences from discontinued operations		0	–	0	433
Other comprehensive income from associated companies and joint		0	-90	0	-113
ventures
Cash flow hedges		-25	-248	-108	161
Cost of hedging		-28	-42	122	45
Debt instruments at fair value through OCI		-2	15	-38	32
Income taxes relating to items that may be reclassified		-26	-273	45	18
Items that will not be reclassified to net income:
Equity instruments at fair value through OCI		–	9	3	9
Remeasurements of defined benefit pension plans		686	-2,683	4,358	-2,588
Income taxes relating to items that will not be reclassified		-137	545	-888	525
Associates' remeasurements of defined benefit pension plans		–	0	–	-12
Other comprehensive income		-453	-5,728	5,193	-5,669
Total comprehensive income		7,651	-7,756	14,271	-6,552
Total net income attributable to:
Owners of the parent		8,068	-2,052	9,033	-943
Non-controlling interests		37	23	46	60
Total comprehensive income attributable to:
Owners of the parent		7,627	-7,456	14,216	-6,408
Non-controlling interests		25	-301	56	-144
Earnings per share (SEK), basic and diluted		1.97	-0.50	2.21	-0.23
of which continuing operations		1.93	-0.50	2.17	-0.18
Number of shares (thousands)
Outstanding at period-end	6	4,089,632	4,089,632	4,089,632	4,089,632
Weighted average, basic and diluted
		4,089,632	4,089,632	4,089,632	4,091,103
EBITDA from continuing operations
Adjusted EBITDA from continuing operations	14	14,083	7,346	20,928	14,470
Depreciation, amortization and impairment losses from	2, 14	7,731	7,737	14,977	15,014
continuing operations		-5,039	-5,114	-10,087	-10,232
Adjusted operating income from continuing operations	2, 14	2,732	2,939	4,953	5,608

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

SEK in millions	Note	Jun 30, 2021	Dec 31, 2020
Assets
Goodwill and other intangible assets	5	88,296	86,521
Property, plant and equipment	5	70,360	70,893
Film and program rights, non-current		1,560	1,312
Right-of-use assets	5	15,144	14,814
Investments in associated companies and joint ventures, pension obligation assets and other non-current assets	9	3,583	3,445
Deferred tax assets		1,250	1,449
Long-term interest-bearing receivables	7, 9	8,730	11,233
Total non-current assets		188,922	189,668
Film and program rights, current		2,676	2,706
Inventories		1,735	1,918
Trade and other receivables and current tax receivables	9	13,409	13,815
Short-term interest-bearing receivables	7, 9	9,112	5,486
Cash and cash equivalents	7	12,989	8,133
Assets classified as held for sale	7, 12	–	4,957
Total current assets		39,922	37,014
Total assets		228,845	226,683
Equity and liabilities Equity attributable to owners of the parent
Equity attributable to non-controlling interests		68,858	62,836
Total equity		1,003	1,118
Long-term borrowings		69,862	63,954
Deferred tax liabilities	7, 9	93,551	100,239
Provisions for pensions and other long-term provisions		10,285	9,845
Other long-term liabilities		7,904	11,787
Total non-current liabilities		1,117	757
		112,856	122,627
Short-term borrowings	7, 9	12,829	8,345
Trade payables and other current liabilities, current tax payables and short-term provisions		33,297	28,430
Liabilities directly associated with assets classified as held for sale	7, 12	–	3,325
Total current liabilities		46,127	40,101
Total equity and liabilities		228,845	226,683

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

SEK in millions		Apr-Jun	Apr-Jun	Jan-Jun	Jan-Jun
Cash flow before change in working capital	Note	2021	2020	2021	2020
Increase/decrease Film and program right assets and liabilities1		6,824 -218	7,056 -661	13,700 -82	14,593 -515
Increase/decrease other operating receivables, liabilities and inventory		605	523	2,205	1,292
Change in working capital		387	-138	2,123	777
Amortization and impairment of Film and program rights1		-966	-652	-2,038	-1,933
Cash flow from operating activities		6,245	6,267	13,785	13,437
of which from continuing operations		6,376	6,267	13,916	13,415
of which from discontinued operations		-131	–	-131	22
Cash CAPEX	14	-3,476	-3,522	-7,167	-6,475
Free cash flow	14	2,769	2,745	6,618	6,962
of which from continuing operations		2,900	2,745	6,749	6,945
of which from discontinued operations		-131	–	-131	17
Cash flow from other investing activities		7,612	2,028	5,627	6,396
Total cash flow from investing activities		4,136	-1,493	-1,540	-78
of which from continuing operations		4,136	-1,493	-1,540	-73
of which from discontinued operations		–	–	–	-5
Cash flow before financing activities		10,380	4,773	12,245	13,359
Cash flow from financing activities		-6,116	-5,862	-7,668	-9,661
of which from continuing operations		-6,116	-5,862	-7,668	-9,659
of which from discontinued operations		–	–	–	-2
Cash flow for the period		4,265	-1,089	4,577	3,699
of which from continuing operations		4,396	-1,089	4,709	3,684
of which from discontinued operations		-131	–	-131	15
Cash and cash equivalents, opening balance		8,843	11,347	8,332	6,210
Cash flow for the period		4,265	-1,089	4,577	3,699
Exchange rate differences in cash and cash equivalents		-118	-219	80	131
Cash and cash equivalents, closing balance		12,989	10,039	12,989	10,039
of which from continuing operations		12,989	10,039	12,989	10,039
of which from discontinued operations		–	–	–	–

See Note 14 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.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

SEK in millions	Owners of the	Non-controlling	Total
	parent	interests	equity
Opening balance, January 1, 2020	91,047	1,409	92,455
Change in accounting principles in associated companies	-12	–	-12
Adjusted opening balance, January 1, 2020	91,035	1,409	92,443
Dividends	-7,361	-175	-7,537
Share-based payments	8	–	8
Acquisition and transfer of treasury shares	-956	–	-956
Cancellation of treasury shares, net effect	–	–	–
Bonus issue, net effect	–	–	–
Total transactions with owners	-8,309	-175	-8,485
Total comprehensive income	-6,408	-144	-6,552
Effect of equity transactions in associated companies	-2	–	-2
Closing balance, June 30, 2020	76,315	1,089	77,405
Dividends	-2,659	-17	-2,676
Share-based payments	8	–	8
Reclassification of Inflation reserve	–	–	–
Total transactions with owners	-2,651	-17	-2,668
Total comprehensive income	-10,829	45	-10,783
Closing balance, December 31, 2020	62,836	1,118	63,954
Dividends	-8,179	-177	-8,356
Share-based payments	7	–	7
Repurchased treasury shares	-21	–	-21
New share issue	–	7	7
Total transactions with owners	-8,194	-170	-8,364
Total comprehensive income	14,216	56	14,271
Closing balance, June 30, 2021	68,858	1,003	69,862

NOTE 1. BASIS OF PREPARATION

General

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 2020. All amounts in this report are presented in SEK millions, unless otherwise stated. Rounding differences may occur.

Change in accounting estimates

Accelerated depreciations

In the fourth quarter 2020 Telia Company entered into strategic partnership agreements with Ericsson and Nokia related to radio access network technology (RAN) to base stations in order to modernize Telia Company's 4G networks and upgrade them to 5G in Sweden, Finland, Lithuania, and Estonia. In connection with this modernization existing RAN assets will be replaced during the years 2021-2025. Telia Company has therefore changed the estimate of the depreciation period for the existing RAN assets in order to correspond with the time plan for the replacements. The change led to increased depreciations for existing assets of approximately SEK 150 million for the second quarter 2021 and approximately SEK 350 million for the first half 2021. The full year increases for 2021 and 2022 are estimated to approximately SEK 800 million and SEK 250 million respectively. The change is expected to result in lower depreciations of existing assets during the years 2023 to 2030.

Reclassification of liquidity portfolio

Telia Company's business model for the liquidity portfolio of long- and short-term bonds and short-term debt instruments has in the past been assessed to be both to collect contractual cash flows and sell financial assets (i.e. the "mixed model"). Consequently, the portfolio has been measured at fair value through other comprehensive income (OCI).

From January 1, 2021 this liquidity portfolio has been reclassified to be measured at fair value through profit and loss (income statement). The reclassification is based on a reassessment of the business model for the portfolio following the major changes of Telia Company (divestment of Eurasia, settlement with the US and Dutch authorities, acquisition of GET/TDC and Bonnier Broadcasting and new senior management) which have had an impact on portfolio management. A new ambition for total liquidity has been implemented and since the volatility in liquidity of the group has decreased there is more focus on generating yield on the long-term liquidity back-up. The liquidity management has shifted focus from preserving cash at a low cost to optimizing the size of the portfolio and maximizing yield given the decided risk appetite.

The carrying value of the reclassified portfolio amounted to SEK 7,707 million as of January 1, 2021, whereof SEK 5,086 million was recognized as long-term interest-bearing receivables, SEK 2,235 million as shortterm interest-bearing receivables and SEK 385 million as cash equivalents. The amount was categorized in the fair value hierarchy as SEK 6,457 million in level 1 and SEK 1,250 million in level 2. As a consequence of the change in business model for the portfolio, the cumulative gain of SEK 35 million that was previously recognized in the fair value reserve was reclassified to the income statement and reported in the finance net for the first quarter 2021. The reclassified gain and negative fair value changes of the portfolio of SEK 51 million resulted in a total negative impact of 16 MSEK on finance net in the first quarter 2021. The negative fair value changes in the finance net during the second quarter of SEK 6 million were offset by derivatives hedging the liquidity portfolio from the second quarter.

References

For more information regarding:

• Sales and earnings, Cash flow and Financial position, see pages 6- 7.
• Significant events in the first and second quarter, see page 8.
• Significant events after the end of the second quarter, see page 8.
• Risks and uncertainties, see page 37.

Restatement of financial and operational data

As a result of various organizational changes, Net sales, CAPEX excl. fees for licenses and spectrum and right-of-use assets, employees and operating assets and liabilities have been restated for comparability as presented in the table below.

Furthermore, disaggregation of revenue has been restated for comparability for segment Sweden, Norway and Lithuania between the lines, leaving the total service revenues unchanged.

Amounts in SEK millions except employees	Sweden	Finland	Norway	Denmark	Lithuania	Estonia	TV and Media	Other operations	Elimina -tions	Group
CAPEX excluding fees for licenses,
spectrum and right-of-use assets,
second quarter 2020	–	-4	–	–	3	2	55	-55	–	–
CAPEX excluding fees for licenses, spectrum and right-of-use assets, Jan
Jun 2020	–	-4	–	–	5	5	103	-108	–	–
Employees, Jun 30, 2020	-34	97	–	–	18	-104	140	-117	–	–
Internal Net Sales, second quarter 2020
Reorganization Sweden – Other
operations	-2	–	–	–	–	–	–	–	2	–
Reorganization Finland - Estonia	–	–	–	–	–	-11	–	–	11	–
Reorganization TV Media – Other
operations	–	–	–	–	–	–	-104	–	104	–
Internal Net Sales, Jan-Jun 2020
Reorganization Sweden – Other operations	-4	–	–	–	–	–	–	–	4	–
Reorganization Finland - Estonia	–	–	–	–	–	-23	–	–	23	–
Reorganization TV Media – Other
operations	–	–	–	–	–	–	-222	–	222	–
Disaggregation of revenues, second
quarter 2020 Reclassification Sweden
Business solutions	-15	–	–	–	–	–	–	–	–	-15
Other fixed service revenues	15	–	–	–	–	–	–	–	–	15
Disaggregation of revenues, second quarter 2020 Lithuania bundle split
Fixed telephony	–	–	–	–	-4	–	–	–	–	-4
Broadband	–	–	–	–	0	–	–	–	–	0
TV	–	–	–	–	3	–	–	–	–	3
Business solutions	–	–	–	–	0	–	–	–	–	0
Disaggregation of revenues, second quarter 2020 Reclassification Norway
Broadband	–	–	2	–	–	–	–	–	–	2
Other fixed service revenues	–	–	-2	–	–	–	–	–	–	-2
Disaggregation of revenues, Jan-Jun 2020 Reclassification Sweden
Business solutions	-31	–	–	–	–	–	–	–	–	-31
Other fixed service revenues	31	–	–	–	–	–	–	–	–	31
Disaggregation of revenues, Jan-Jun 2020 Lithuania bundle split
Fixed telephony	–	–	–	–	-7	–	–	–	–	-7
Broadband	–	–	–	–	0	–	–	–	–	0
TV	–	–	–	–	7	–	–	–	–	7
Business solutions	–	–	–	–	0	–	–	–	–	0
Disaggregation of revenues, Jan-Jun 2020 Reclassification Norway
Broadband	–	–	2	–	–	–	–	–	–	2
Other fixed service revenues	–	–	-2	–	–	–	–	–	–	-2
Segment assets, Dec 31, 2020	–	–	–	–	34	3	-37	–	–	–
Segment liabilities, Dec 31, 2020	181	31	132	11	–	–	-355	–	–	–

NOTE 2. ADJUSTMENT ITEMS

Adjustment items within operating income, continuing operations

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Within EBITDA	6,352	-391	5,951	-544
Restructuring charges, synergy implementation costs, costs related to historical legal disputes, regulatory charges and taxes etc.:
Sweden	-14	-50	-126	-104
Finland	-12	-36	-28	-35
Norway	-14	-36	-81	-71
Denmark	-12	-13	-26	-13
Lithuania	-2	-2	-6	-5
Estonia	-1	-1	-4	-2
TV and Media	-49	-26	-70	-31
Other operations	-284	-164	-459	-220
Capital gains/losses1	6,739	-63	6,751	-63
Within Depreciation, amortization and impairment losses2	-16	–	-16	-110
Within Income from associated companies and joint ventures3	–	-3,494	–	-3,494
Total adjustment items within operating income, continuing operations	6,335	-3,885	5,935	-4,148

1) 2021 includes a capital gain from the disposal of Telia Carrier as well as a capital gain from the disposal of the Alerta business, see Note 12. 2) 2021 relates to an impairment of capitalized software development expenses connected to a disposed business. First half 2020 includes an impairment of SEK -110 million relating to remeasurement of the Finnish real estate companies. 3) Second quarter and first half 2020 includes an impairment of SEK -3,488 million related to the holding in Turkcell,

Costs for major group wide business transformations have been added to the definition of Adjustment items from the first quarter 2021. Management believe that this change results in reliable and more relevant information on the financial performance of the group as these transformation costs are not considered being part of the underlying financial performance of the business over time. See Definitions on page 41.

NOTE 3. SEGMENT INFORMATION

SEK in millions	Apr-Jun	Apr-Jun	Jan-Jun	Jan-Jun
Net sales	2021	2020	2021	2020
Sweden1	8,492	8,351	16,893	16,673
of which external	8,446	8,304	16,801	16,578
Finland	3,549	3,769	7,090	7,666
of which external	3,499	3,716	6,981	7,544
Norway	3,343	3,229	6,652	6,658
of which external	3,339	3,246	6,643	6,650
Denmark	1,242	1,324	2,523	2,754
of which external	1,228	1,300	2,488	2,711
Lithuania	1,052	1,047	2,051	2,043
of which external	1,042	1,033	2,027	2,015
Estonia1	826	796	1,604	1,621
of which external	812	780	1,577	1,592
TV and Media1	2,271	1,583	4,175	3,457
of which external	2,271	1,582	4,175	3,456
Other operations	1,576	2,204	3,720	4,450
Total segments1	22,351	22,303	44,710	45,321
Eliminations1	-475	-534	-1,019	-1,125
Group	21,877	21,770	43,691	44,197
Adjusted EBITDA
Sweden	3,308	3,316	6,544	6,714
Finland	1,046	1,223	2,116	2,379
Norway	1,530	1,510	3,073	2,898
Denmark	221	255	436	486
Lithuania	370	375	738	748
Estonia	299	281	591	571
TV and Media	575	311	695	310
Other operations	382	467	785	910
Total segments	7,731	7,737	14,977	15,014
Eliminations	-	-	-	-
Group	7,731	7,737	14,977	15,014
Operating income
Sweden	1,345	1,555	2,582	3,224
Finland	515	358	752	602
Norway	530	371	971	568
Denmark	-28	-14	-79	-31
Lithuania	184	207	368	421
Estonia	138	102	265	208
TV and Media	322	94	216	-106
Other operations	6,060	-3,619	5,814	-3,428
Total segments	9,067	-946	10,888	1,460
Eliminations	–	–	–	–
Group	9,067	-946	10,888	1,460
Financial items, net	-678	-927	-1,366	-1,608
Income after financial items	8,389	-1,873	9,522	-148

1) Second quarter and first half 2020 are restated for comparability see Note 1.

	Jun 30, 2021	Jun 30, 2021	Dec 31, 2020	Dec 31, 2020
SEK in millions	Segment assets	Segment liabilities	Segment assets	Segment liabilities
Sweden1	45,546	11,980	46,824	12,453
Finland1	43,709	4,670	44,248	4,815
Norway1	53,376	5,826	51,769	5,259
Denmark1	7,671	2,414	7,504	1,882
Lithuania1	6,355	1,525	6,459	1,330
Estonia1	5,418	989	5,487	971
TV and Media1	13,250	2,147	13,241	1,545
Other operations	23,810	6,035	23,812	6,452
Total segments	199,135	35,587	199,343	34,707
Unallocated	29,709	123,396	22,383	124,695
Assets and liabilities held for sale	–	–	4,957	3,325
Total assets/liabilities, group	228,845	158,983	226,683	162,727

1) 2020 is restated for comparability, see Note 1.

NOTE 4. NET SALES

					Apr-Jun 2021
SEK in millions							TV and	Other	Elimina
	Sweden	Finland	Norway	Denmark	Lithuania	Estonia	Media	operations	tions	Total
Mobile subscription revenues	3,127	1,521	1,628	628	303	232	–	328	–	7,767
Interconnect	125	98	105	56	36	19	–	35	–	474
Other mobile service revenues	121	138	149	84	7	3	0	6	–	509
Total mobile service revenues	3,373	1,757	1,882	768	346	254	0	369	–	8,750
Telephony	405	17	25	38	45	27	–	0	–	559
Broadband	1,160	162	353	48	153	145	0	1	–	2,023
TV	491	135	402	18	98	71	752	0	–	1,967
Business solutions	669	594	104	35	67	66	–	14	–	1,549
Other fixed service revenues	963	292	23	10	97	98	–	529	–	2,012
Total fixed service revenues	3,689	1,200	907	148	461	408	752	544	-	8,109
Advertising revenues	–	–	–	–	–	–	1,500	–	–	1,500
Other service revenues	273	60	38	21	4	3	19	106	–	524
Total service revenues1	7,336	3,017	2,827	937	811	665	2,271	1,019	–	18,883
Total equipment revenues1	1,110	482	512	291	231	147	–	222	–	2,994
Total external net sales	8,446	3,499	3,339	1,228	1,042	812	2,271	1,241	–	21,877
Internal net sales	47	50	4	14	10	15	0	334	-475	–
Total net sales	8,492	3,549	3,343	1,242	1,052	826	2,271	1,576	-475	21,877

1) In all material aspects, equipment revenues are recognized at a point in time and service revenues over time.

					Apr-Jun 2020
SEK in millions				Den			TV and	Other	Elimina
	Sweden2	Finland	Norway2	mark	Lithuania2	Estonia2	Media2	operations	tions2	Total2
Mobile subscription revenues	3,131	1,624	1,525	645	283	236	–	316	–	7,760
Interconnect	138	111	98	53	46	19	–	35	–	502
Other mobile service
revenues	138	148	222	90	16	3	–	12	–	629
Total mobile service
revenues	3,408	1,883	1,845	788	345	259	–	363	–	8,891
Telephony	489	28	34	47	57	30	–	1	–	684
Broadband	1,176	173	313	56	144	147	1	2	–	2,010
TV	422	113	389	17	95	71	481	–	–	1,589
Business solutions	728	658	109	48	59	61	–	22	–	1,684
Other fixed service revenues	968	311	21	9	99	84	–	1,139	–	2,632
Total fixed service revenues	3,782	1,283	865	177	454	393	482	1,164	–	8,599
Advertising revenues	–	0	–	–	–	–	1,063	–	–	1,063
Other service revenues	280	67	50	27	5	3	37	107	–	575
Total service revenues1	7,469	3,233	2,760	992	804	655	1,582	1,634	–	19,129
Total equipment revenues1	835	484	486	308	229	125	–	174	–	2,640
Total external net sales	8,304	3,716	3,246	1,300	1,033	780	1,582	1,808	–	21,770
Internal net sales	47	53	-17	24	14	16	0	396	-534	–
Total net sales	8,351	3,769	3,229	1,324	1,047	796	1,583	2,204	-534	21,770

1) In all material aspects, equipment revenues are recognized at a point in time and service revenues over time. 2) Restated, see Note 1.

					Jan-Jun 2021
SEK in millions							TV and	Other	Elimina
	Sweden	Finland	Norway	Denmark	Lithuania	Estonia	Media	operations	tions	Total
Mobile subscription revenues	6,204	3,034	3,205	1,235	592	457	–	650	–	15,378
Interconnect	246	194	201	111	72	39	–	69	–	932
Other mobile service revenues	237	275	291	155	14	5	0	12	–	988
Total mobile service revenues	6,687	3,503	3,698	1,501	678	501	0	730	–	17,298
Telephony	836	34	54	88	92	56	–	1	–	1,161
Broadband	2,328	326	697	91	302	289	0	8	–	4,040
TV	978	269	799	34	197	141	1,478	0	–	3,896
Business solutions	1,350	1,188	208	80	125	129	–	35	–	3,115
Other fixed service revenues	1,848	565	46	20	189	186	–	1,555	–	4,408
Total fixed service revenues	7,340	2,382	1,803	313	904	800	1,478	1,598	–	16,619
Advertising revenues	–	–	–	–	–	–	2,642	–	–	2,642
Other service revenues	541	123	83	44	9	6	54	210	–	1,070
Total service revenues1	14,568	6,008	5,583	1,858	1,591	1,307	4,175	2,539	–	37,629
Total equipment revenues1	2,233	973	1,059	630	436	270	–	459	–	6,062
Total external net sales	16,801	6,981	6,643	2,488	2,027	1,577	4,175	2,998	–	43,691
Internal net sales	92	110	10	35	24	27	0	722	-1,019	–
Total net sales	16,893	7,090	6,652	2,523	2,051	1,604	4,175	3,720	-1,019	43,691

1) In all material aspects, equipment revenues are recognized at a point in time and service revenues over time.

	Jan-Jun 2020
SEK in millions							TV and	Other	Elimina
	Sweden2	Finland	Norway2	Denmark	Lithuania2	Estonia2	Media2	operations	tions2	Total2
Mobile subscription revenues	6,300	3,266	3,179	1,324	572	484	–	640	–	15,765
Interconnect	268	214	207	114	85	39	–	73	–	999
Other mobile service revenues	270	294	446	178	25	6	–	24	–	1,243
Total mobile service revenues	6,838	3,774	3,832	1,616	682	529	–	737	–	18,008
Telephony	1,002	55	76	100	113	60	–	1	–	1,407
Broadband	2,356	355	638	110	287	295	2	5	–	4,046
TV	874	283	822	51	193	142	1,146	–	–	3,511
Business solutions	1,422	1,310	224	96	115	124	–	41	–	3,332
Other fixed service revenues	1,870	618	33	22	199	178	–	2,266	–	5,186
Total fixed service revenues	7,523	2,620	1,793	379	906	799	1,149	2,313	–	17,482
Advertising revenues	–	2	–	–	–	–	2,232	–	–	2,234
Other service revenues	542	138	99	50	11	7	75	198	–	1,120
Total service revenues1	14,903	6,534	5,724	2,045	1,599	1,335	3,456	3,248	–	38,845
Total equipment revenues1	1,675	1,009	926	666	416	257	–	403	–	5,352
Total external net sales	16,578	7,544	6,650	2,711	2,015	1,592	3,456	3,651	–	44,197
Internal net sales	95	123	8	43	29	29	0	799	-1,125	–
Total net sales	16,673	7,666	6,658	2,754	2,043	1,621	3,457	4,450	-1,125	44,197

1) In all material aspects, equipment revenues are recognized at a point in time and service revenues over time. 2) Restated, see Note 1.

NOTE 5. INVESTMENTS

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
CAPEX	5,192	4,168	10,001	8,474
Intangible assets	1,174	883	2,593	1,538
Property, plant and equipment	2,890	2,708	5,225	4,996
Right-of-use assets	1,127	577	2,183	1,940
Acquisitions and other investments	18	24	56	33
Asset retirement obligations	6	3	32	12
Equity instruments	12	21	24	21
Total continuing operations including assets held for sale	5,210	4,192	10,057	8,506
Total discontinued operations	–	–	–	12
of which CAPEX	–	–	–	11
Total investments	5,210	4,192	10,057	8,518
of which CAPEX	5,192	4,168	10,001	8,485

NOTE 6. TREASURY SHARES

During the second quarter 2021 Telia Company transferred 595,632 shares to the participants in the "Long Term Incentive program 2018/2021" (LTI program) at an average price of SEK 35.32 per share. The total cost for the transferred shares was SEK 21 million and transaction costs, net of tax, amounted to SEK 0 million. The transfer of shares under the LTI program reduced other contributed capital within parent shareholder's equity by SEK 21 million during the six-months period ended June 30, 2021 (SEK 12 million during the six-months period ended June 30, 2020).

No Telia Company shares were held by the company or by its subsidiaries as of June 30, 2021 or as of December 31, 2020. The total number of issued and outstanding shares was 4,089,631,702.

NOTE 7. NET DEBT

SEK in millions	Jun 30, 20212	Dec 31, 20202
Long-term borrowings	93,549	100,655
of which lease liabilities, non-current	12,337	12,600
Less 50% of hybrid capital1	-10,328	-10,267
Short-term borrowings	12,829	8,620
of which lease liabilities, current	2,847	2,946
Less derivatives recognized as financial assets and hedging long-term and short-term borrowings and related credit support annex (CSA)	-2,272	-4,205
Less long-term bonds at fair value through income statement and OCI	-5,383	-5,297
Less short-term investments	-6,183	-2,832
Less cash and cash equivalents	-12,989	-8,332
Net debt	69,224	78,343

1) 50% of hybrid capital is treated as equity, consistent with market practice for this type of instrument, and reduces net debt. 2) Net debt is based on the total Telia Company group including net debt related to discontinued operations and assets held for sale.

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.

NOTE 8. LOAN FINANCING AND CREDIT RATING

In June 2021, outstanding Telia bonds denominated in SEK with a maturity date in 2023 were bought back at a total nominal amount of SEK 289 million. No major funding transactions were executed during the first half of 2021.

The credit rating of Telia Company has remained unchanged during 2021. Moody's rating for long-term borrowings is Baa1 with a stable outlook. The Standard & Poor long-term rating is BBB+ and the shortterm rating is A-2, both with a stable outlook.

NOTE 9. FINANCIAL INSTRUMENTS – FAIR VALUES

	Jun 30, 2021			Dec 31, 2020
Long-term and short-term borrowings1 SEK in millions	Carrying value	Fair value	Carrying value	Fair value
Long-term borrowings
Interest rate derivatives at fair value	456	456	134	134
Cross-currency interest rate derivatives at fair value	1,432	1,432	3,907	3,907
Subtotal	1,888	1,888	4,041	4,041
Open-market financing borrowings in fair value hedge relationships	53,452	59,473	51,628	55,249
Open-market financing borrowings at amortized cost	25,009	30,948	31,345	41,992
Other borrowings at amortized cost	865	865	1,042	1,042
Lease liabilities at amortized cost	12,337		12,183
Total long-term borrowings	93,551		100,239
Short-term borrowings
Interest rate derivatives at fair value	25	25	8	8
Cross-currency interest rate derivatives at fair value	182	182	143	143
Subtotal	208	208	151	151

Utilized bank overdraft and short-term credit facilities at amortized cost	5	5	213	213
Open-market financing borrowings in fair value hedge relationships	9,211	9,386	5,131	5,317
Other borrowings at amortized cost	559	559	179	179
Lease liabilities at amortized cost	2,847		2,671
Total short-term borrowings	12,829		8,345

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 2020, Note C3 to the consolidated financial statements.

		Jun 30, 2021				Dec 31, 2020
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	416	–	–	416	473	–	–	473
Equity instruments at fair value through income statement	18	–	–	18	18	–	–	18
Long- and short-term bonds at fair value through OCI2	808	808	–	–	8,513	7,263	1,250	–
Long- and short-term bonds at fair value through income statement2	10,979	8,849	2,130	–	–	–	–	–
Derivatives designated as hedging instruments	1,624	–	1,624	–	3,129	–	3,129	–
Derivatives at fair value through income statement	33	–	33	–	1,049	–	1,049	–
Total financial assets at fair value by level	13,878	9,657	3,787	434	13,181	7,263	5,427	490
Financial liabilities at fair value
Derivatives designated as hedging instruments	1,950	–	1,950	–	3,802	–	3,802	–
Derivatives at fair value through income statement	166	–	166	–	917	–	917	–
Total financial liabilities at fair value by level	2,116	–	2,116	–	4,719	–	4,719	–

1) For information on fair value hierarchy levels and fair value estimation, see the Annual and Sustainability Report 2020, Note C3 to the consolidated financial statements and the section below. 2) From January 1, 2021, Telia Company changed its business model for the liquidity portfolio. The portfolio was previously measured at fair value through OCI but is from January 1, 2021, measured at fair value through income statement., see Note 1.

Fair value measurement of Level 3 financial instruments

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-Jun 2021	Liabilities, Jan-Jun 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	Contingent considerations
Level 3, opening balance	473	18	491	–
Changes in fair value	3	–	3	–
of which recognized in other comprehensive income	3	–	3	–
Purchases/capital contributions	13	–	13	–
Disposals	-71	–	-71	–
Settlements	-2	–	-2	–
Exchange rate differences	0	–	0	–
Level 3, closing balance	416	18	434	–

		Liabilities, Jan-Dec 2020
Movements within Level 3, fair value hierarchy SEK in millions	Equity instruments at fair value through OCI	Jan-Dec 2020 Equity instruments at fair value through income statement	Total	Contingent considerations
Level 3, opening balance	319	13	332	41
Changes in fair value	63	–	63	–
of which recognized in other comprehensive income	63	–	63	–
Purchases/capital contributions	99	5	104	–
Settlements	-7	–	-7	-41
Exchange rate differences	-2	–	-2	–
Level 3, closing balance	473	18	491	–

NOTE 10. CONTINGENT LIABILITIES, COLLATERAL PLEDGED AND LITIGATIONS

SEK in millions	Jun 30, 2021	Dec 31, 2020
Issued financial guarantees	290	311
of which referred to guarantees for pension obligations	289	295
Collateral pledged	41	43
Total contingent liabilities and collateral pledged	331	354

The arbitration proceedings against Telia Company and Turkcell under the Share Purchase Agreement related to the divestment of the subsidiary Kcell in Kazakhstan in 2018 was settled during the second quarter 2021. As part of the settlement Telia Company paid SEK 131 million (equivalent to USD 16 million) and has consequently released all related provisions. The gain from net changes in provisions is recognized within discontinued operations (Note 12). For other ongoing legal proceedings, see Note C30 in the Annual and Sustainability Report 2020.

NOTE 11. CONTRACTUAL OBLIGATIONS AND COMMITMENTS

SEK in millions	Jun 30, 2021	Dec 31, 2020
Contractual obligations and commitments	21,400	21,765
of which film and program rights	15,396	15,728
Total contractual obligations and commitments	21,400	21,765

NOTE 12. ASSETS HELD FOR SALE, DISCONTINUED OPERATIONs and disposals

Net income from discontinued operations (region Eurasia)

SEK in millions, except per share data	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Net sales	–	–	–	96
Expenses and other operating income, net	–	–	–	-79
Operating income	–	–	–	16
Financial items, net	–	–	–	-22
Income after financial items	–	–	–	-6
Income taxes	–	–	–	0
Net income before remeasurement and gain/loss on disposal	–	–	–	-6
Loss on disposal of Moldcell in Moldova (including cumulative Moldcell exchange loss in equity reclassified to net income of SEK - 172 million)1	–	–	–	-193
Gain from net changes in provisions for transaction warranties	176	–	176	–
Net income from discontinued operations	176	–	176	-199
EPS from discontinued operations (SEK)	0.04	–	0.04	-0.05
Adjusted EBITDA	–	–	–	30

1) Non-taxable loss from the disposal of Moldcell in Moldova on March 24, 2020.

Assets classified as held for sale

		Telia Carrier
SEK in millions	Jun 30, 2021	Dec 31, 2020
Goodwill and other intangible assets	–	86
Property, plant and equipment	–	2,148
Right-of-use assets	–	1,097
Other non-current assets	–	534
Other current assets	–	891
Cash and cash equivalents	–	199
Assets classified as held for sale	–	4,957
Long-term borrowings	–	416
Long-term provisions	–	848
Other long-term liabilities	–	620
Short-term borrowings	–	275
Other current liabilities	–	1,166
Liabilities associated with assets classified as held for sale	–	3,325
Net assets classified as held for sale	–	1,631

Disposals

Telia Carrier

On October 5, 2020 Telia Company signed an agreement to sell its international carrier business, Telia Carrier, to Polhem Infra for a value of SEK 9,450 million on a cash and debt free basis. Telia Carrier was classified as held for sale since September 30, 2020. The transaction was subject to regulatory approvals (relating to e.g. competition and foreign direct investments) in, inter alia, the EU and the US and was closed on June 1, 2021. The disposal resulted in a capital gain of SEK 6,428 million for the group in the second quarter 2021, whereof accumulated foreign exchange losses reclassified from equity to net income of SEK 353 million. The reclassification of accumulated exchange losses had no effect on total equity. The capital gain is recognized within Other operating income. The transaction had a positive cash flow effect for the group in the second quarter 2021 of SEK 8,609 million (price received less cash and cash equivalents in the entities sold).

Alerta

On April 1, 2021, Telia Company disposed its Finnish alarm communication business Alerta for a price of EUR 32 million. The disposal resulted in a capital gain of SEK 309 million for the group in the second quarter 2021. The capital gain is recognized within Other operating income. The transaction had a positive cash flow effect for the group in the second quarter 2021 of SEK 329 million.

Partial disposal after the reporting period

Tower businesses in Finland and Norway

On June 30, 2021 Telia Company signed an agreement to dispose 49% of the tower businesses in Finland and Norway to Brookfield and Alecta, at a price corresponding to an enterprise value for 100% of EUR 1,524 million (approximately SEK 15.4 billion) on a cash and debt free basis. The transaction is subject to customary regulatory approvals and closing is expected to take place in the fourth quarter of 2021. Once the transaction closes Telia Company will receive EUR 722 million (approximately SEK 7.3 billion) for the 49% stake. If, and when, there is a transfer of the tower assets from their respective business units, there will likely be a need for a review of the remaining carrying values of the business units.

NOTE 13. FINANCIAL KEY RATIOS

The key ratios presented in the table below are based on the total Telia Company group including both continuing and discontinued operations.

	Jun 30,	Dec 31,
	2021	2020
Return on equity (%, rolling 12 months)1	neg.	neg.
Return on capital employed (%, rolling 12 months)1	neg.	neg.
Equity/assets ratio (%)1	28.7	24.6
Net debt/adjusted EBITDA ratio (multiple, rolling 12 months)	2.32	2.55
Parent owners' equity per share (SEK)1	16.84	15.36

1) Equity is adjusted by weighted ordinary dividend, see the Annual and Sustainability Report 2020 section Definitions for key ratio definitions.

NOTE 14. ALTERNATIVE PERFORMANCE MEASUREMENT

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 2020. These terms may be defined differently by other companies and are therefore not always comparable to similar measures used by other companies.

Service revenues

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Net sales	21,877	21,770	43,691	44,197
Excluded: Equipment revenues	-2,994	-2,640	-6,062	-5,352
Service revenues (external)	18,883	19,129	37,629	38,845
Excluded: Telia Carrier external service revenues	-542	-1,153	-1,597	-2,291
Excluded: Effects from changes in foreign exchange rates1	140	-68	343	-307
Service revenues, in constant currency and excluding Telia Carrier	18,481	17,908	36,376	36,247

1) Changes in foreign exchange rates refers to full year average rates prior year.

EBITDA and adjusted EBITDA

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Operating income	9,067	-946	10,888	1,460
Income from associated companies and joint ventures	-23	3,178	-47	2,778
Total depreciation/amortization/write-down	5,039	5,114	10,087	10,232
EBITDA	14,083	7,346	20,928	14,470
Adjustment items within EBITDA (Note 2)1	-6,352	391	-5,951	544
Adjusted EBITDA	7,731	7,737	14,977	15,014
Excluded: Telia Carrier adjusted EBITDA	-156	-243	-371	-471
Excluded: Effects from changes in foreign exchange rates2	38	-26	110	-126
Adjusted EBITDA in constant currency and excluding Telia Carrier	7,613	7,468	14,716	14,417

1) Definition for Adjustment items has been changed, see Note 2 and Definitions. 2) Changes in foreign exchange rates refers to full year average rates prior year.

Adjusted operating income

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Operating income	9,067	-946	10,888	1,460
Adjustment items within Operating income (Note 2)1	-6,335	3,885	-5,935	4,148
Adjusted operating income	2,732	2,939	4,953	5,608

1) Definition for Adjustment items has been changed, see Note 2 and Definitions.

CAPEX, Cash CAPEX and Cash CAPEX to net sales

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Investments in intangible assets	1,174	883	2,593	1,538
Investments in property, plant and equipment	2,890	2,708	5,225	4,996
CAPEX excluding right of use assets	4,064	3,591	7,818	6,534
Investments in right-of-use assets	1,127	577	2,183	1,940
CAPEX	5,192	4,168	10,001	8,474
Excluded: investments in license and spectrum fees	-360	-144	-1,121	-144
CAPEX excluding fees for licenses and spectrum	4,832	4,023	8,880	8,329
Excluded: investments in right-of-use assets	-1,127	-577	-2,183	-1,940
CAPEX excluding fees for licenses and spectrum and right of use assets	3,704	3,446	6,697	6,389

SEK in millions, except ratio	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
CAPEX	5,192	4,168	10,001	8,474
Excluded: investments in right-of-use assets	-1,127	-577	-2,183	-1,940
Net of not paid investments and additional payments from previous periods	-589	-68	-651	-63
Cash CAPEX	3,476	3,522	7,167	6,470
Excluded: Cash CAPEX for licenses and spectrum fees	-52	-112	-920	-112
Excluded: Telia Carrier Cash CAPEX excluding fees for licenses and spectrum	-54	-142	-182	-257
Cash CAPEX, excluding Telia Carrier and fees for licenses and spectrum	3,370	3,268	6,065	6,101
				,
Net sales	21,877	21,770	43,691	44,197
Excluded: Net sales Telia Carrier (external)	-542	-1,153	-1,597	-2,291
Net sales excluding Telia Carrier	21,335	20,616	42,094	41,906
Cash CAPEX to net sales, excluding Telia Carrier and fees for licenses and spectrum (%)	15.8%	15.9%	14.4%	14.6%

Free cash flow

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Cash flow from operating activities	6,245	6,267	13,785	13,437
Cash CAPEX (paid intangible and tangible assets)	-3,476	-3,522	-7,167	-6,475
Free cash flow, continuing and discontinued operations	2,769	2,745	6,618	6,962

Operational free cash flow

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Cash flow from operating activities from continuing operations	6,376	6,267	13,916	13,415
Cash CAPEX from continuing operations	-3,476	-3,522	-7,167	-6,470
Free cash flow, continuing operations	2,900	2,745	6,749	6,945
Excluded: Cash CAPEX for licenses and spectrum fees from continuing operations	52	112	920	112
Excluded: Dividends from associates from continuing operations	-151	0	-152	-177
Excluded: Taxes paid on dividends from associates from continuing operations	–	–	–	–
Repayments of lease liabilities	-743	-655	-1,424	-1,372
Operational free cash flow	2,057	2,202	6,094	5,508
Excluded: Changes in working capital	-387	138	-2,123	-777
Structural part of Operational free cash flow	1,670	2,339	3,971	4,731

Net debt and Net debt/Adjusted EBITDA ratio (multiple, rolling 12 months)

SEK in millions, except for multiple	Jun 30, 2021	Dec 31, 2020
Net debt	69,224	78,343
Adjusted EBITDA continuing operations accumulated current year	14,977	30,702
Adjusted EBITDA continuing operations previous year	15,687	–
Adjusted EBITDA discontinued operations accumulated current year	–	30
Excluding: Disposed operations	-809	-30
Adjusted EBITDA rolling 12 months excluding disposed operations	29,855	30,702
Net debt/adjusted EBITDA ratio (multiple)	2.32x	2.55x
Net debt	69,224	78,343
Estimated tower business proceeds (49%)	7,300	–
Net debt including estimated tower proceeds	61,923	78,343
Adjusted EBITDA rolling 12 months excluding disposed operations	29,855	30,702
Estimated Net debt/adjusted EBITDA ratio (multiple) including the tower proceeds	2.07x	2.55x

Adjusted EBITDA margin

SEK in millions, except ratio	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Net sales	21,877	21,770	43,691	44,197
Adjusted EBITDA	7,731	7,737	14,977	15,014
Adjusted EBITDA margin (%)	35.3%	35.5%	34.3%	34.0%

PARENT COMPANY

Condensed income statements

SEK in millions	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
Net sales	127	128	244	259
Gross income	127	128	244	259
Operating expenses and other operating income, net	-320	-316	-681	-463
Operating income	-193	-188	-437	-204
Financial income and expenses	10,219	802	9,491	-1,654
Income after financial items	10,026	614	9,054	-1,858
Appropriations	1,535	122	2,609	1,772
Income before taxes	11,562	736	11,663	-86
Income taxes	-289	-261	-418	-190
Net income	11,273	475	11,246	-276

Financial income and expenses in the second quarter 2021 increased to SEK 10,219 million (802) mainly impacted by the capital gain from the disposal of the Telia Carrier subsidiaries of SEK 6,279 million and dividends received from subsidiaries of SEK 3,927 million (2,807). The second quarter in 2020 was negatively impacted by an impairment of the subsidiary Telia Finland Oyj with SEK 2,955 million partly offset by positive foreign exchange effects. Financial income and expenses for the first half 2021 increased to SEK 9,491 million (-1,654) mainly impacted by the capital gain from the disposal of the Telia Carrier subsidiaries of SEK 6,279 million and dividends received from subsidiaries of SEK 7,999 million (6,101) partly offset by impairment of the subsidiary Telia Finland Oyj of SEK 4,500 million (6,655). The first half in 2020 was further negatively impacted by higher net interest expenses.

Condensed balance sheets

Jun 30, SEK in millions 2021		Dec 31,
		2020
Assets
Non-current assets	167,006	178,700
Current assets	39,358	36,111
Total assets	206,364	214,811
Equity and liabilities
Restricted shareholders' equity	15,712	15,712
Non-restricted shareholders' equity	62,805	59,775
Total shareholders' equity	78,517	75,487
Untaxed reserves	6,767	7,002
Provisions	445	557
Long-term liabilities	80,357	87,018
Short-term liabilities and short-term provisions	40,277	44,747
Total equity and liabilities	206,364	214,811

Non-current assets decreased to SEK 167,006 million (178,700), mainly impacted by an impairment of the subsidiary Telia Finland Oyj, disposal of the Telia Carrier subsidiaries and decreased other long interestbearing receivables.

Equity increased to SEK 78,517 million (75,487) impacted by a positive Net income offset by approved dividend.

Long-term liabilities decreased to SEK 80,357 million (87,018) impacted by reclassification of long-term borrowings to short-term borrowings.

Short-term liabilities and short-term provisions decreased to SEK 40,277 million (44,747), mainly due to decreased short-term intragroup borrowings partly offset by reclassification from long-term to shortterm borrowing.

During the first half 2021 Telia Company AB issued guarantees on behalf of subsidiaries amounting to SEK 1,517 million (EUR 150 million). For other financial guarantees see Note P24 in the Annual and Sustainability Report 2020.

RISKS AND UNCERTAINTIES

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 expo-sure and risk management, see the Annual and Sustainability Report 2020, Directors Report, section Risk and uncertainties.

Telia Company's risk universe

Strategic risks

Risks that can have a material impact on the strategic objectives arising from internal or external factors

Financial risks

Risks that can cause unexpected variability or volatility in net sales, margins, earnings per share, returns or market capitalization

Operational

risks Risks that may affect or compromise execution of business functions or have an impact on society

Legal &

regulatory risks Risks related to legal or governmental actions that can have a material impact on the achievement of business objectives

Board of directors' and president's certification

The Board of Directors and the President and CEO certify that the Interim Report gives a true and fair overview of the Parent Company's and Group's operations, their financial position and results of operations, and describes significant risks and uncertainties facing the Parent Company and other companies in the Group.

Stockholm, July 21, 2021

Lars-Johan Jarnheimer Chair of the Board

Ingrid Bonde Vice-Chair of the Board

Agneta Ahlström Board member, employee representative

Stefan Carlsson Board member, employee representative

Luisa Delgado Board member Rickard Gustafson Board member

Jeanette Jäger Board member

Nina Linander Board member Jimmy Maymann Board member

Martin Tivéus Board member

Rickard Wäst Board member, employee representative

Allison Kirkby President and CEO

Review report

Introduction

We have reviewed the interim report for Telia Company AB (publ) for the period January 1 - June 30, 2021. 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.

Scope of 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.

Conclusion

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, July 21, 2021

Deloitte AB

Peter Ekberg Authorized Public Accountant

FORWARD-LOOKING STATEMENTS

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.

DEFINITIONS

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: 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 companies and excluding the impact of any disposed companies, 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.

Telephony revenues: External net sales related to fixed telephony services.

Total equipment revenues: External equipment net sales.

Total 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.

*Costs for major group wide business transformations have been added to the definition of Adjustment items, see Note 2.

FINANCIAL CALENDAR

Interim Report January-September 2021 October 21, 2021

Year-end Report January-December 2021 January 28, 2022

This information is information that Telia Company AB is obliged to make public pursuant to the EU Market Abuse Regulation and Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 07.00 CET on July 21, 2021.

Telia Company AB (publ) Corporate Reg. No. 556103-4249 Registered office: Stockholm Tel. +46 8 504 550 00. www.teliacompany.com