Tele2 Full Year Report 2007 - Tele2

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Feb 12, 2008 6:00 AM CET

Tele2 Full Year Report 2007

Stockholm - Tuesday, February 12, 2008 - Tele2 AB ("Tele2") (OMX Nordic Exchange: TEL2 A and TEL2 B), today announced its consolidated results for the fourth quarter and full year 2007.

Operating revenue less divested operations in Q4 2007 amounted to SEK 10,447 (9,731) million, an increase of 7 percent  
EBITDA less divested operations in Q4 2007 increased by 4 percent to SEK 1,564 (1,506) million
 
EBIT less divested operations in Q4 2007 amounted to SEK 247 (708) million including one-off items of SEK -328 (50) million (see note 1 and 2)
 
Operating revenue less divested operations for the full year 2007 grew by 9 percent to SEK 40,313 (37,113) million. Operating revenue from continuing operations 2) for the full year 2007 grew by 1 percent to SEK 43,420 (43,098) million
 
Net profit/loss from continuing operations for the full year 2007 amounted to SEK -302 (-1,003) million
 
Earnings per share from continuing operations after dilution for the full year 2007 amounted to SEK -0.45 (-1.98)
 
Tele2's net debt amounted to SEK 5,198 (15,311) million at the end of 2007, a decrease by 66 percent
 
The Board of Directors proposes an ordinary dividend of SEK 3.15 (1.83) per share. The Board of Directors also proposes a special dividend of 4.70 together with the authorisation to purchase up to 10 percent of shares in the company
 
Lars-Johan Jarnheimer, President and CEO of Tele2 AB comments:
 
"2007 was an exciting year dominated by the successful realignment of Tele2 and the strong operational development in our core mobile businesses. Eastern Europe and Sweden have continuously been highlighted as superior performers and we are pleased to notice that Tele2's operations in these countries have ended the year on a high note.
 
Looking into 2008, we see more of the same positive development. The realignment process is set to continue. There is still a need to further align the scale and scope of our organization to support the areas where we have the best profitability.
 
In Q4 2007, Tele2 was awarded 17 new regional GSM 1800 licenses in Russia. With progress comes challenge - we need to find qualified personnel, establish a local presence in all regions and expand commercially viable mobile networks. On the other hand our historic performance in mobile operations proves we have a successful business model in place.
 
We have said it before, but it is important to emphasize that our core business is mobile services on our own infrastructure. At the end of 2007 mobile services represented 56 percent of revenue and 84 percent of EBITDA. We know that we are world class in operating cost efficient mobile networks and we will continue to focus our management and financial resources in this area. Hence, it is important that we continue to develop mobile services, through investing and expanding in areas where we see extraordinary opportunities, so that we can stay best in class.
 
In earlier reports we mentioned the promising development of mobile broadband. The Q4 2007 performance strengthens our belief that mobile broadband is the long awaited blockbuster data service. In 2008, we will make sure that we lead this new market and based on the strong acceleration in new customers, we believe that the coming years will be key for our success.
 
Mobile telephony
revenue and profitability continued to grow strongly in the quarter. Revenues less divested operations grew by 19 percent and EBITDA improved by 30 percent compared to Q4 2006 with a net customer intake of 706,000. Russia continued to be the main growth driver and Tele2 is now the largest operator in 6 of the regions where we operate. The Swedish operations dominated the mobile broadband market in the quarter, adding 48,000 new customers. At the end of Q4 2007 we had 93,000 mobile broadband customers in Sweden.
 
Tele2 offers Broadband services in nine countries. Our broadband operations less divested operations generated a revenue growth of 18 percent, driven mainly by our services on our own infrastructure. We see the broadband product as a good complement to our core mobile operations and it is important that profitability in this area improves in 2008 and contributes to the operations as a whole.
 
Fixed telephony
operations less divested operations, continued to deliver robust results and we strove to maximise value by being costs conscious. Our EBITDA margin within fixed telephony was a strong 18 percent in the quarter, despite a revenue decline of 17 percent year-on-year as the market is in a structural decline."
 
Contacts:
 
Lars-Johan Jarnheimer
President and CEO, Tele2 AB
Telephone: +46 (0)8 5626 4000
 
Lars Nilsson
CFO, Tele2 AB
Telephone: +46 (0)8 5626 4000
 
Lars Torstensson
Investor Relations
Telephone: +46 (0)8 5620 0042
 
Visit us at our homepage: www.tele2.com
 
Conference call details:
A conference call, with an interactive presentation, to discuss the results will be held at 08.00 (CET) / 07.00 (UK time) / 02.00 am (New York time), on February 12, 2008. The dial-in numbers are:
UK: +44 (0)20 7162 0025,
US: +1 334 323 6201,
France: +33 (0)1 7099 3208,
Germany: +49 (0)695 8999 0507,
The Netherlands: +31 (0)20 7965 008 and
Sweden: +46 (0)8 5052 0110
 
Please dial in 10 minutes prior to the start of the conference call to allow time for registration. The conference call will also be available as a link on the Tele2 corporate website www.tele2.com, both live and as an archived version.
 
Tele2 is one of Europe's leading telecom operator. Tele2's mission is to provide cheap and simple telecoms. Tele2 always strives to offer the market's best prices. We have 25 million customers in 15 countries. Tele2 offers fixed and mobile telephony, broadband, data network services, cable TV and content services. 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 the OMX Nordic Exchange since 1996. In 2007, we had an operating revenue of SEK 43.4 billion and reported an operating profit (EBITDA) of SEK 6.6 billion.

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