Interim Report January-June 2008
EBITDA in Q2 2008 increased by 29 percent to SEK 2,069 (1,603) million.
EBIT in Q2 2008 increased by 52 percent to SEK 1,117 (736) million excluding one-off items of SEK -738 (0) million related to impairment loss in Germany. Including one-off items EBIT amounted to SEK 379 (736) million.
Net profit/loss in Q2 2008 amounted to SEK 114 (-331) million.
Earnings per share in Q2 2008, after dilution, amounted to SEK 0.27 (-0.67).
Net sales for H1 2008 amounted to SEK 20,007 (18,622) million, an increase of 7 percent.
Net profit/loss for H1 2008 amounted to SEK 815 (-62) million.
Earnings per share for H1 2008 amounted to SEK 1.82 (0.03).
Tele2's net debt at the end of H1 2008 amounted to SEK 8,157 (17,258) million, a decrease of 53 percent.
Lars-Johan Jarnheimer, President and CEO of Tele2 AB comments:
"Tele2 has developed dramatically over the years, as a result of a focused strategy and a strong commitment. Today we are experiencing the fruits of the hard work undertaken by Tele2 and its employees - with an all time high operating result.
Despite a new record in absolute EBITDA contribution, we will not relax in any sense - there is still much to be accomplished and a lot of things we can do better.
The realignment of the group will continue, making sure that unprofitable entities sharpen up or else be released from the organization. However, this realignment process also includes the development of the well performing majority of the group. Hence we will look for complementary assets, built on mobile services, especially in our emerging market footprint.
We will further investigate the possibility of moving into green-field mobile operations in the CIS (Commonwealth of Independent States). Our proven track-record of running efficient and successful mobile operations underlines that this is the right way forward for Tele2.
The mobile operations of Tele2 continue to show good and robust operational performance, despite a very competitive environment. Russia, Sweden, Croatia and the Baltic all showed strong customer intake. Tele2 Russia once again managed to improve profitability and delivered an EBITDA margin of 36 percent. This should be seen in the light of increasing operational and capital expenditures related to the roll-out of operations in the Krasnodar region as well as in the 17 new regions recently awarded. The Baltic region was to some extent negatively affected by the poor economic environment. However, the operations managed to maintain a stable EBITDA margin at 33 percent. Croatia once again had good traction in the consumer segment adding 37,000 new mobile users. The migration to the new roaming agreement went smoothly and Tele2 Croatia continues to focus on improvement of its own network. The Swedish mobile operations recovered from a somewhat slower Q1 2008 and added 85,000 customers in Q2 2008, of which 24,000 were mobile broadband users.
Our fixed broadband operations developed slower and added 4,000 customers during the quarter. Revenue grew by 15 percent and the EBITDA margin was -1 percent in the quarter. We have promised improved profitability in fixed broadband, so that the service can meet the hurdles set by management. Q2 2008 showed a significant uptick in EBITDA performance, both sequentially as well as compared to the same period last year. We still have some way to go and we see improvement to come as we focus more on fixed broadband as a complement to mobile services and less on market share on a standalone basis.
Fixed telephony operations continued to deliver very robust results and profitability. The EBITDA margin was a solid 25 percent in the quarter. Even though we are well aware of the deteriorating long term prospects for fixed line services, good cash flows remain to be generated in this area."
President and CEO
Telephone: +46 (0)8 5626 4000
Telephone: +46 (0)8 5626 4000
Telephone: +46 (0)8 5620 0042
Conference call details
A conference call, with an interactive presentation, to discuss the results will be held at 15.00 (CET) / 14.00 (UK time) / 09.00 am (New York time), on July 23, 2008. To register for the conference call and receive a dial-in number together with an access code, please visit the Tele2 corporate website www.tele2.com. The conference call will also be available as a link on the Tele2 corporate website, both live and as an archived version.
Please dial in 10 minutes prior to the start of the conference call to allow time for registration.
Tele2 is one of Europe's leading alternative telecom operators. Tele2's mission is to provide price leading and easy to use communication services. Tele2 always strives to offer the market's best prices. We have 24 million customers in 12 countries. Tele2 offers mobile services, fixed broadband and telephony, 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 net sales of SEK 41.5 billion and reported an operating profit (EBITDA) of SEK 6.3 billion. Please visit us at www.tele2.com