Stockholm - Thursday, February 15, 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 fourth quarter 2006.
- Operating revenue for Q4 2006 amounted to SEK 12,952 (12,635) million. Operating revenue for 2006 increased by more than 13% to SEK 50,306 (44,457) million
- EBITDA in Q4 2006 was SEK 1,466* (1,415) million. EBITDA for 2006 was SEK 5,652 (5,772) million
- Net profit/loss for 2006 amounted to SEK -2,405 (1,836) million, including a goodwill write down related to the SEC acquisition in 2000 (a total one-time effect of SEK 3.3 billion)
- Net profit/loss for 2006 including discontinued operations in France amounted to SEK -3,740 (2,341) million, including write-down of goodwill of SEK 4.8 billion**
- Earnings per share, after dilution, for 2006 amounted to SEK -5.13 (4.15)
- The Board of Directors proposes a dividend of SEK 1.83 (1.75) per share, which is an increase of 5 %
* Including net positive non-recurring items of SEK 3 (137) million (see Note 2-3).
** Q3 2006 includes a write-down of goodwill in divested operations of SEK 1,500 million (see Note 6). The previous reported positive exchange rate effect of SEK 500 million has been reversed and the expected positive exchange rate effect will instead be reported in Q1 2007 when the sale of Tele2's French fixed line and broadband operations is finalized.
Lars-Johan Jarnheimer, President and CEO of Tele2 AB comments:
"The past two years have been years of transition moving towards an infrastructure based business model from a reseller based business model. We focus on our mobile telephony success and use our fixed telephony customer base to cross sell broadband services. The future Tele2 is leaner and meaner, with a more narrow geographical footprint than today. Our objective remains the same, to create shareholder value.
In order to reach an adequate scale we depend on factors such as a favorable regulatory. Tele2 will continue the previously announced strategy review, which will lead to action. Running a company like Tele2, with multiple services and products, is like driving a car. How fast we drive and what direction we drive in depends on changing road conditions (e.g. customer needs, regulations and competition).
During 2006, Tele2 announced a push in broadband sales and marketing, with the aim of increasing customer intake and strengthening the Tele2 brand. This push has been successful, and during 2007 the results will become apparent.
Tele2 produced - once again - solid operational results in the fourth quarter.
Our mobile business has continued its success and achieved a strong customer intake in Q4. Russia in particular performed very well, with revenue growth of 161% year on year, together with a strong customer intake and EBITDA. Going forward, we have decided to evaluate our MVNO business to make sure that shareholder value is maximized.
In fixed line resale, churn has continued to level off, although there is no certainty that this marks any significant trend. However, the fixed line business will continue to deliver significant cash flows in the future.
Our broadband business has produced an impressive increase in customer intake, with 253,000 new customers in Q4, which gives us a total broadband customer base of 1.8 million. I am especially pleased with our performance in Italy, which has tripled its intake of direct access customers in the quarter. Scale is important to become successful in this area.
Looking into 2007, we reiterate our previous outlook of significantly higher EBITDA and increased organic growth, compared with 2006."
Lars-Johan Jarnheimer Telephone: + 46 8 5626 4000
President and CEO, Tele2 AB
Investor Relations Telephone: + 44 20 5620 0042
A presentation to discuss the results will be held at 08.15 am UK time (09.15 am CET) at the City Presentation Centre, 4 Chiswell Street, London (EC1Y 4UF). 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 February 15, 2007. The dial-in number is: +44 (0)20 7806 1955 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 3598594#. The conference call will be web-cast on Tele2's website www.tele2.com, along with the presentation material.
Tele2 is Europe's leading alternative telecom operator. Our mission is to offer cheap and simple telecoms. Tele2 always strives to offer the market's best prices. We have 29 million customers in 22 countries. Tele2 offers products and services in fixed and mobile telephony, broadband, data network services and cable TV. Ever since Jan Stenbeck founded Tele2 in 1993, the company has been a tough challenger to the former government monopolies. Tele2 has been listed on the OMX Nordic Exchange since 1996. In 2006, we reported operating revenue of SEK 50.3 billion and EBITDA of SEK 5.7 billion.