Tele2 Interim Report January - June 2007 - Tele2

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Jul 25, 2007 6:00 AM CET

Tele2 Interim Report January - June 2007

Stockholm - Wednesday, July 25, 2007 - Tele2 AB ("Tele2") (OMX Nordic Exchange: TEL2 A and TEL2 B), Europe's leading alternative telecom operator, today announced its consolidated results for the second quarter 2007.

- Operating revenue for Q2 2007 grew by 6 percent to SEK 13,110 (12,386) million 
 
- EBITDA in Q2 2007 increased by 40 percent to SEK 1,737 (1,237) million
 
- EBIT in Q2 2007 increased by 110 percent to SEK 604 (288) million excluding one-off items of SEK -520 (52) million related to the sale of Alpha Telecom and Calling Card Company (C3) operations. Including one-off items EBIT decreased by 75 percent to SEK 84 (340) million
 
- Net profit/loss from continuing operations for Q2 2007 amounted to SEK 108 (136) million excluding one-off items of SEK -520 (52) million
 
- Earnings per share from continuing operations, after dilution, for Q2 2007 amounted to SEK 0.32 (0.41) excluding one-off items of SEK -520 (52) million
 
- Operating revenue for H1 2007 grew by 5 percent to SEK 25,947 (24,629) million
 
- Net profit/loss for H1 2007 amounted to SEK 190 (279) excluding, and SEK -330 (331) million including, one-off items of SEK -520 (52) million
 
- Earnings per share, after dilution, for H1 2007 amounted to SEK 0.60 (0.81) excluding, and SEK -0.57 (0.92) including, one-off items of SEK -520 (52) million
 
- Mobile revenues in Q2 2007 increased by 25.5 percent to SEK 5.8 billion
 
- Continued excellent performance in Russian mobile operations with EBITDA margin of 33 percent in Q2 2007. Russia now has a customer base in excess of 7.9 million
 
- Solid broadband intake during Q2 2007, adding a total of 221,000 new broadband customers
 
- Fixed telephony EBITDA margin at 12 (9) percent in Q2 2007
 
Lars-Johan Jarnheimer, President and CEO of Tele2 AB comments:
 
"Tele2's realignment process remains on track and is proving successful. As stated previously, a more infrastructure-based strategy will lead to higher margins. These quarterly results prove that we really are on the right track. Our focus on core business in mobile and broadband services is showing key results. EBITDA grew 40 percent, compared to Q2 2006.
 
However, we're aiming even higher. Therefore we have introduced a financial hurdle to keep us on our toes. We have set a minimum EBITDA target of 20 percent for each of Tele2's geographies, and they must stride over this hurdle in the medium term. This is a sign of our dedication, focus and concentration.
 
Our performance in mobile services is strong. Russia has once again proved star qualities with an EBITDA margin at a record-high 33 percent. Competition is tough in the Russian mobile services market, but we are certain of our ability to master the current situation. 
 
The Baltic region produced impressive revenue growth, with a year-on-year increase of 18 percent. We see promising development, especially in the corporate segment. The Nordic area is showing a good balance between revenue growth and EBITDA development in absolute terms.
 
Our broadband business continues to show progress with a total customer intake of 221,000 new customers in Q2 2007. Italy accomplished its strongest direct access & LLUB intake ever, adding 107,000 customers during the quarter.
 
EBITDA in direct access & LLUB was negatively impacted by start-up costs - this time in the German operations. However, I am pleased to see that Southern Europe has turned the corner when it comes to operational performance.
 
Tele2's fixed line customer base still offers opportunities in cross-selling broadband services. Dispite a high level of competition, our fixed line operations are developing according to plan. We strive to maximize value through an extremely cost-conscious regime and broadband cross-selling."
 
Further information can be obtained from:
Lars-Johan Jarnheimer, President and CEO Tele2 AB, Telephone: +46 8 5626 4000
 
Lars Nilsson, CFO Tele2 AB, Telephone: +46 8 5626 4000
 
Lars Torstensson, Investor Inquiries, Telephone: +46 702 73 48 79
 
Visit us at our website: http://www.tele2.com
 
PRESENTATION DETAILS
A presentation to discuss the results will be held at 06.45 am UK time (07.45 am CET) at Hilton Stockholm Slussen, Guldgränd 8, Stockholm. The presentation will be web-cast on Tele2's website www.tele2.com, along with the presentation material.
 
CONFERENCE CALL DETAILS
A conference call to discuss the results will be held at 16.00 (CET) / 15.00 (UK time) / 10.00 am (New York time), on July 25, 2007. The dial-in number is: +44 (0)20 7806 1956 or US: +1 718 354 1388. Please dial in 10 minutes prior to the start of the conference call to allow time for registration. A recording of the conference call will be available for 10 days after the call on: +44 (0)20 7806 1970 or US: +1 718 354 1112 with access code 3024007#. The conference call will be web-cast on Tele2's website www.tele2.com, with the possibility to enter questions online.
 
 
Tele2 is Europe's leading alternative telecom operator Tele2's mission is to provide cheap and simple telecoms for everyone in Europe. Tele2 always strives to offer the market's best prices. We have 29 million customers in 21 countries. Tele2 offers fixed and mobile telephony, broadband, data network services and cable TV. Ever since Jan Stenbeck founded the company in 1993, it has been a tough challenger to the former government monopolies and other established providers. Tele2 has been listed on OMX Nordic Exchange since 1996. In 2006 we had operating revenue of SEK 50.3 billion and we reported an operating profit (EBITDA) of SEK 5.7 billion.
 

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