UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
The Securities Exchange Act of 1934
October 27, 2004
TeliaSonera
(Exact name of registrant as specified in its charter)
Sturegatan 1 S-106 63 Stockholm, Sweden
(Address of principal executive offices)
0-30340
(Commission File Number)
Indicate by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form 40-F:
Form 20-F / x / Form 40-F / /
Indicate by check mark whether the registrant by furnishing the
information contained in this form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes / / No / x /
On October 27, 2004 the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference
(c) Exhibit 99.1. Press release dated October 27, 2004
Pursuant to the requirements of the Securities Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
TeliaSonera
(Registrant) |
||
October 27, 2004
(Date) |
/s/ JAN HENRIK AHRNELL
Jan Henrik Ahrnell Vice President and General Counsel |
EXHIBIT 99.1
TeliaSonera January-September 2004
Effective January 1, 2004, TeliaSonera applies IFRS 3, which means that goodwill amortization (GWA) has been discontinued.
Nine-month period
Third quarter
In millions, except percentages and per share data |
Jul-Sep |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Pro forma 1) |
|
|
|
|
|
Net sales |
20,649 |
2,282 |
20,094 |
61,184 |
60,718 |
EBITDA 4) excl. non-recurring
|
8,212 |
907 |
7,915 |
22,739 |
23,547 |
Margin (%) |
39.8 |
39.8 |
39.4 |
37.2 |
38.8 |
Income from
associated |
1,369 |
151 |
419 |
2,635 |
-117 |
Operating income |
6,660 |
736 |
3,653 |
17,493 |
9,758 |
Operating
income excl. |
5,898 |
652 |
5,190 |
15,783 |
14,634 |
Income after financial items |
5,985 |
661 |
3,353 |
16,369 |
9,246 |
Net income |
4,320 |
477 |
1,792 |
10,873 |
4,975 |
Earnings per share |
0.92 |
0.10 |
0.38 |
2.33 |
1.06 |
CAPEX |
2,599 |
287 |
1,889 |
6,982 |
5,624 |
Free cash flow |
5,068 |
560 |
5,138 |
10,853 |
14,190 |
Legal 1) |
|
|
|
|
|
Net sales |
20,649 |
2,282 |
20,094 |
61,184 |
61,371 |
Net income |
4,320 |
477 |
1,792 |
10,873 |
6,384 |
Earnings per share |
0.92 |
0.10 |
0.38 |
2.33 |
1.37 |
1) Pro forma presentation: Excl. Telia's Finnish mobile
operations and Swedish cable
TV operations. Legal presentation:
Including these operations through May 31, 2003.
2) Convenience translation only, conversion rate SEK 1 = EUR
0.110496.
3) Non-recurring items, see table on page
26.
4)
Please refer to page 16 for definitions.
Comments from Anders Igel, President and CEO
"In a very competitive market we show the strongest quarterly result in the history of the company.
The proposed cash returns to shareholders will probably make TeliaSonera one of the highest yielding companies in the sector next year.
To exploit the accelerating migration from fixed to mobile and Internet-based services we are building a platform for future growth with a new focused and simplified service portfolio. This will also make it possible to further bring down costs to levels significantly below the current.
In addition, we are taking active steps to take advantage of the very strong growth in our Eastern markets Turkey, Russia and Eurasia."
Capital distribution to shareholders
TeliaSonera has communicated that it is planning to distribute SEK 30 billion to its shareholders during the period 2005-2007 in addition to ordinary dividends.
To maintain financial flexibility, the Board of Directors will, as a first step, recommend that the Annual General Meeting in April 2005 decide on a distribution of approximately SEK 10 billion.
Repurchase of shares through a public offer with tradable rights will be proposed as the method for distribution. The aim is to seek tax efficiency for shareholders, to avoid unnecessarily complicated structures and to allow shareholders to participate at least for their pro-rata part.
OutlookTeliaSonera's ambition is to strengthen and improve the operations and position within the current footprint and to maintain or increase market shares.
During the next years, the Nordic and Baltic markets are expected to have an overall good volume development in a very competitive environment with continued price pressure. Migration from fixed to mobile and Internet-based services will accelerate. During this transition period, total market sales growth will be limited. Longer term, however, we expect market growth to return to higher levels.
In the important growth operations in Eurasia, Russia and Turkey we expect the very strong growth to continue. We will prioritize enhancing value growth in these operations.
The price pressure in the international carrier market has been stronger than previously expected. Positive cash flow defined as EBITDA less CAPEX is not expected to be reached for the full year in the carrier operations.
For the TeliaSonera group, the fourth quarter of 2004 is expected to show the same trends as the comparative quarter last year in terms of profitability and CAPEX.
TeliaSonera building a platform for future growthThe market for telecommunications is rapidly changing, with migration from fixed to mobile and Internet-based services. These changes are very fast-paced and are likely to accelerate. The trend benefits players with sufficiently high volumes who are able to profitably combine efficient product development with ever-lower costs of production. TeliaSonera sees great opportunities in this market trend, which is why we are building a platform for future growth and take measures for sustained good profitability.
TeliaSonera's long-term strategy for growth is focused on easy-to-use services that, individually or combined, add value for TeliaSonera's 24 million customers and that improve TeliaSonera's revenue possibilities. Most of the existing services will gradually be replaced by new services based on IP and mobility. The service portfolio will be focused on new offerings within mobile voice and data, broadband services, managed services, content distribution and bundled services. TeliaSonera will also take advantage of the opportunities afforded by greater standardization within and between the markets in which TeliaSonera operates.
TeliaSonera's profitability in recent years was achieved primarily through streamlining measures and changes within a complex product program built up over a long period. The ongoing simplification of the services portfolio will entail significantly fewer services, enabling the company inter alia to reduce the number of its IT and support systems.
The opportunities that have now been identified also enable TeliaSonera to reduce costs to completely different levels than current cost levels and to facilitate more efficient marketing and sales.
TeliaSonera strives towards comprehensive simplicity both for its customers and within the company. The rate of change is steered by many external factors, but TeliaSonera takes initiatives and promotes development in order to take advantage of its economies of scale, both in production and in the market. A reasonable assessment is that the transition will continue for approximately three years, which is why growth initiatives will be accelerated and prioritized without losing focus on actions securing competitive cost levels.
Third Quarter Review of the GroupContinued strong customer growth and positive earnings trend
Net sales increased 3 percent to SEK 20,649 million. Lower price levels had a negative impact of 6 percent on sales, while divestitures and acquisitions had a positive impact of 1 percent. No major exchange rate fluctuations.
The customer
base increased robustly and at the end of the quarter,
TeliaSonera had, including customers in the associated companies, 58 million
customers, representing an increase of 27 percent year on
year.
Operating income, excluding non-recurring items and GWA, improved to SEK 5,898 million (5,190). The operations in Eurasia, Russia, Finland, Denmark, the mobile businesses in the Baltic countries and Holding contributed to these improved earnings.
EBITDA, excluding non-recurring items, improved to SEK 8,212 million (7,915) and the margin was strengthened to 39.8 percent (39.4).
Financial items totaled SEK -675 million (-300), of which non-recurring items totaled SEK -498 million (-31).
Net income, after tax and minority shares, improved to SEK 4,320 million (1,792) and earnings per share increased to SEK 0.92 (0.38).
CAPEX climbed to SEK 2,599 million (1,889) due to higher investments in the growth areas broadband, IP-based services and mobile communications.
Free cash flow totaled SEK 5,068 million (5,138). In addition, a cash inflow of SEK 260 million was received through the sale of Zed while the increase of shareholdings in Omnitel and Eesti Telekom involved cash outflows of SEK 483 million and SEK 94 million, respectively.
The strong cash flow reduced net debt from SEK 10,662 million to SEK 5,743 million during the third quarter.
Disbursements from restructuring reserves had a negative impact on free cash flow of SEK 118 million. At quarter-end, reserves for future disbursements totaled SEK 2,447 million.
The equity/assets ratio was stable at 62 percent.
Additional synergy initiatives were taken in the third quarter, including a streamlined customer service process, a common environment for workplace servers, and a common roaming network for exchange of mobile data traffic.
SEK in millions |
Decided
synergies |
Achieved
synergies |
OPEX |
|
|
Product and service development |
611 |
419 |
IT systems and infrastructure |
406 |
157 |
Purchasing |
342 |
342 |
Network operations |
549 |
458 |
Corporate functions |
153 |
153 |
Total |
2,061 |
1,529 |
CAPEX |
|
|
Product and service development |
36 |
13 |
IT systems and infrastructure |
28 |
25 |
Purchasing |
491 |
491 |
Network operations |
19 |
12 |
Total |
574 |
541 |
Costs for implementing decided synergies are estimated at SEK 1,370 million, while costs for implementing achieved synergies totaled SEK 1,049 million.
Third Quarter Review of Profit CentersMarket position and
profitability maintained
in
Sweden
SEK in
millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
10,219 |
10,473 |
30,651 |
31,792 |
of which external |
10,005 |
10,267 |
30,073 |
31,013 |
EBITDA excl. non-recurring items |
4,343 |
4,535 |
12,586 |
13,724 |
Margin (%) |
42.5 |
43.3 |
41.1 |
43.2 |
Operating income |
3,169 |
3,021 |
9,675 |
8,680 |
Operating income excl. non-recurring items and GWA |
3,173 |
3,019 |
9,100 |
9,053 |
CAPEX |
997 |
588 |
2,804 |
1,884 |
Mobile communications |
|
|
|
|
Net sales |
3,223 |
3,290 |
9,166 |
9,194 |
EBITDA excl. non-recurring items |
1,505 |
1,497 |
3,903 |
4,266 |
Margin (%) |
46.7 |
45.5 |
42.6 |
46.4 |
CAPEX |
161 |
79 |
457 |
236 |
Fixed communications |
|
|
|
|
Net sales |
6,996 |
7,183 |
21,485 |
22,598 |
EBITDA excl. non-recurring items |
2,838 |
3,038 |
8,683 |
9,458 |
Margin (%) |
40.6 |
42.3 |
40.4 |
41.9 |
CAPEX |
835 |
509 |
2,347 |
1,648 |
SEK in millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
4,524 |
4,306 |
13,707 |
13,042 |
of which external |
4,427 |
4,203 |
13,435 |
12,800 |
EBITDA excl. non-recurring items |
1,886 |
1,673 |
5,293 |
5,185 |
Margin (%) |
41.7 |
38.9 |
38.6 |
39.8 |
Operating income |
1,041 |
497 |
2,763 |
1,667 |
Operating income excl. non-recurring items and GWA |
1,049 |
868 |
2,776 |
2,754 |
CAPEX |
492 |
458 |
1,637 |
1,449 |
Mobile communications |
|
|
|
|
Net sales |
2,814 |
2,632 |
8,440 |
8,112 |
EBITDA excl. non-recurring items |
1,425 |
1,299 |
3,963 |
3,951 |
Margin (%) |
50.6 |
49.4 |
47.0 |
48.7 |
CAPEX |
246 |
231 |
754 |
697 |
Fixed communications |
|
|
|
|
Net sales |
1,710 |
1,674 |
5,267 |
4,930 |
EBITDA excl. non-recurring items |
461 |
374 |
1,330 |
1,234 |
Margin (%) |
27.0 |
22.3 |
25.3 |
25.0 |
CAPEX |
245 |
227 |
883 |
752 |
SEK in millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
1,674 |
1,546 |
4,687 |
4,622 |
of which external |
1,630 |
1,524 |
4,572 |
4,562 |
EBITDA excl. non-recurring items |
558 |
622 |
1,540 |
1,949 |
Margin (%) |
33.3 |
40.2 |
32.9 |
42.2 |
Operating income |
325 |
128 |
926 |
383 |
Operating income excl. non-recurring items and GWA |
367 |
435 |
968 |
1,370 |
CAPEX |
179 |
128 |
406 |
479 |
SEK in millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
992 |
835 |
2,908 |
2,242 |
of which external |
963 |
809 |
2,826 |
2,176 |
EBITDA excl. non-recurring items |
76 |
19 |
213 |
-53 |
Margin (%) |
7.7 |
2.3 |
7.3 |
-2.4 |
Operating income |
-59 |
-126 |
-198 |
-526 |
Operating income excl. non-recurring items and GWA |
-59 |
-121 |
-198 |
-509 |
CAPEX |
125 |
91 |
253 |
234 |
Mobile communications |
|
|
|
|
Net sales |
504 |
435 |
1,442 |
1,121 |
EBITDA excl. non-recurring items |
8 |
-37 |
27 |
-143 |
CAPEX |
81 |
49 |
141 |
92 |
Fixed communications excl. Stofa |
|
|
|
|
Net sales |
287 |
240 |
896 |
656 |
EBITDA excl. non-recurring items |
12 |
2 |
30 |
-32 |
CAPEX |
37 |
26 |
80 |
87 |
Stofa |
|
|
|
|
Net sales |
201 |
160 |
570 |
465 |
EBITDA excl. non-recurring items |
56 |
54 |
156 |
122 |
CAPEX |
8 |
16 |
32 |
55 |
Mobile communications
Strong mobile customer intake in Lithuania
SEK in millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Mobile communications |
|
|
|
|
Net sales |
542 |
543 |
1,587 |
1,521 |
of which external |
506 |
513 |
1,491 |
1,431 |
EBITDA excl. non-recurring items |
247 |
234 |
706 |
697 |
Margin (%) |
45.6 |
43.1 |
44.5 |
45.8 |
Operating income |
160 |
97 |
445 |
283 |
Operating income excl. non-recurring items and GWA |
160 |
142 |
445 |
419 |
CAPEX |
54 |
63 |
203 |
257 |
Fixed communications |
|
|
|
|
Net sales |
470 |
523 |
1,428 |
1,599 |
of which external |
440 |
493 |
1,346 |
1,511 |
EBITDA excl. non-recurring items |
222 |
316 |
679 |
834 |
Margin (%) |
47.2 |
60.4 |
47.5 |
52.2 |
Operating income |
21 |
-137 |
58 |
-223 |
Operating income excl. non-recurring items and GWA |
21 |
76 |
58 |
95 |
CAPEX |
60 |
25 |
120 |
119 |
Mobile communications
Mobile communications
SEK in millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Mobile communications |
|
|
|
|
Net sales |
552 |
487 |
1,522 |
1,381 |
of which external |
540 |
482 |
1,493 |
1,367 |
EBITDA excl. non-recurring items |
302 |
257 |
818 |
731 |
Margin (%) |
54.7 |
52.8 |
53.7 |
52.9 |
Operating income |
246 |
166 |
649 |
458 |
Operating income excl. non-recurring items and GWA |
246 |
201 |
649 |
564 |
CAPEX |
46 |
67 |
145 |
192 |
Fixed communications |
|
|
|
|
Income from associated companies |
55 |
67 |
175 |
150 |
of which share of net income |
36 |
44 |
116 |
85 |
of which amortization of goodwill |
- |
3 |
- |
3 |
of which amortization of fair value adjustments |
19 |
20 |
59 |
62 |
SEK in millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Mobile communications |
|
|
|
|
Income from associated companies |
75 |
55 |
114 |
85 |
of which share of net income |
79 |
77 |
126 |
150 |
of which amortization of goodwill |
- |
-18 |
- |
-55 |
of which amortization of fair value adjustments |
-4 |
-4 |
-12 |
-10 |
Fixed communications |
|
|
|
|
Income from associated companies |
36 |
32 |
57 |
37 |
of which share of net income |
37 |
43 |
61 |
72 |
of which amortization of goodwill |
- |
-11 |
- |
-31 |
of which amortization of fair value adjustments |
-1 |
0 |
-4 |
-4 |
SEK in millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
1,153 |
750 |
2,933 |
1,934 |
of which external |
1,153 |
749 |
2,932 |
1,933 |
EBITDA excl. non-recurring items |
692 |
449 |
1,707 |
1,086 |
Margin (%) |
60.0 |
59.9 |
58.2 |
56.2 |
Operating income |
559 |
298 |
1,332 |
643 |
Operating income excl. non-recurring items and GWA |
559 |
341 |
1,332 |
769 |
CAPEX |
586 |
263 |
1,237 |
642 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Share of net income |
271 |
227 |
499 |
535 |
Amortization of goodwill |
- |
-50 |
- |
-153 |
Income from associated companies |
271 |
177 |
499 |
382 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Share of net income (US GAAP) |
269 |
218 |
587 |
287 |
IFRS adjustments |
-169 |
210 |
177 |
625 |
Amortization of goodwill |
- |
-174 |
- |
-420 |
Amortization of fair value adjustments |
25 |
-47 |
-61 |
-114 |
Income from associated companies |
125 |
207 |
703 |
378 |
SEK in millions, except |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
1,009 |
1,096 |
2,962 |
3,872 |
of which external |
695 |
763 |
2,023 |
2,899 |
EBITDA excl. non-recurring items |
15 |
54 |
16 |
44 |
Margin (%) |
1.5 |
4.9 |
0.5 |
1.1 |
Operating income |
-135 |
-376 |
-433 |
-603 |
Operating income excl. non-recurring items and GWA |
-112 |
-50 |
-356 |
-342 |
CAPEX |
53 |
117 |
140 |
209 |
SEK in millions, except
|
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
360 |
406 |
1,173 |
1,113 |
of which external |
331 |
329 |
1,032 |
953 |
EBITDA excl. non-recurring items |
12 |
25 |
-36 |
-19 |
Margin (%) |
3.3 |
6.2 |
-3.1 |
-1.7 |
Income from associated companies |
807 |
-137 |
1,049 |
-1,174 |
Operating income |
918 |
-194 |
1,503 |
-1,418 |
Operating income excl. non-recurring items and GWA |
67 |
-252 |
223 |
-613 |
CAPEX |
8 |
88 |
36 |
189 |
Stockholm, October 27, 2004
Anders Igel
President and CEO
We have made a review of this interim report in accordance with recommendations issued by the Swedish Institute of Authorized Public Accountants. A review is substantially limited in scope in comparison to an audit. Nothing has come to our attention that indicates that this interim report fails to comply with the requirements of the Swedish Securities Exchange Act and International Financial Reporting Standards (IFRS).
Stockholm, October 27, 2004
PricewaterhouseCoopers AB
Göran Tidström
Authorized Public Accountant
Financial Information
Year-End Report January-December 2004 February 11, 2005 |
Questions
regarding content in the reports:
TeliaSonera AB Investor Relations SE-106 63 Stockholm, Sweden Tel. +46 8 504 550 00 Fax +46 8 611 46 42 www.teliasonera.com/ir |
Ordering of individual hard copies of the
reports: Tel. +46 372 851 42 Fax +46 372 843 56 www.teliasonera.com/ir
|
Definitions
EBITDA: An abbreviation of "Earnings Before Interest, Tax, Depreciation and Amortization." Equals operating income before depreciation, amortization and write-downs and before income from associated companies. ARPU: Average monthly revenue per user. Churn: The number of post-paid customers that have left the company expressed as a percentage of the average number of post-paid customers. All comparisons are with the previous quarter.
|
TeliaSonera January-September 2004
- Pro forma 1)
In millions, except per share data and no. of shares |
Jul-Sep |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
20,649 |
2,282 |
20,094 |
61,184 |
60,718 |
Operating expenses |
-12,352 |
-1,365 |
-12,523 |
-37,358 |
-37,838 |
EBITDA |
8,297 |
917 |
7,571 |
23,826 |
22,880 |
Depreciation, amortization and write-downs |
-3,006 |
-332 |
-4,337 |
-8,968 |
-13,005 |
Income from associated companies |
1,369 |
151 |
419 |
2,635 |
-117 |
Operating income |
6,660 |
736 |
3,653 |
17,493 |
9,758 |
Net financial revenues and expenses |
-675 |
-75 |
-300 |
-1,124 |
-512 |
Income after financial items |
5,985 |
661 |
3,353 |
16,369 |
9,246 |
Income taxes |
-1,246 |
-138 |
-1,339 |
-4,514 |
-3,590 |
Minority interests |
-419 |
-46 |
-222 |
-982 |
-681 |
Net income |
4,320 |
477 |
1,792 |
10,873 |
4,975 |
Earnings per share |
|
|
|
|
|
Basic |
0.92 |
0.10 |
0.38 |
2.33 |
1.06 |
Diluted |
0.92 |
0.10 |
0.38 |
2.33 |
1.06 |
Weighted average no. of shares (thousands) |
|
|
|
|
|
Basic |
4,675,232 |
4,675,232 |
4,675,232 |
4,675,232 |
4,675,232 |
Diluted |
4,675,232 |
4,675,232 |
4,676,165 |
4,675,232 |
4,675,997 |
|
|
|
|
|
|
EBITDA excl. non-recurring items |
8,212 |
907 |
7,915 |
22,739 |
23,547 |
Operating income excl. non-recurring items and GWA |
5,898 |
652 |
5,190 |
15,783 |
14,634 |
1) Excluding Telia's Finnish mobile operations and Swedish cable TV operations through May 31, 2003.
Condensed Consolidated Balance Sheets
In millions |
Sep 30, |
Sep 30, |
Dec 31, |
Assets |
|
|
|
Intangible fixed assets |
61,615 |
6,808 |
61,820 |
Tangible fixed assets |
47,824 |
5,285 |
49,161 |
Financial fixed assets |
37,723 |
4,168 |
42,061 |
Total fixed assets |
147,162 |
16,261 |
153,042 |
Inventories, etc. |
521 |
58 |
501 |
Receivables |
20,593 |
2,275 |
24,170 |
Short-term investments |
13,775 |
1,522 |
8,658 |
Cash and bank |
4,245 |
469 |
3,689 |
Total current assets |
39,134 |
4,324 |
37,018 |
Total assets |
186,296 |
20,585 |
190,060 |
|
|
|
|
Shareholders' equity and liabilities |
|
|
|
Shareholders' equity |
119,095 |
13,160 |
112,393 |
Minority interests |
3,785 |
418 |
3,441 |
Provisions for pensions and |
619 |
68 |
522 |
Deferred tax liability, other provisions |
14,086 |
1,557 |
14,775 |
Total provisions |
14,705 |
1,625 |
15,297 |
Long-term loans |
12,027 |
1,329 |
25,867 |
Short-term loans |
11,736 |
1,297 |
4,687 |
Non-interest bearing liabilities |
24,948 |
2,756 |
28,375 |
Total liabilities |
48,711 |
5,382 |
58,929 |
Total shareholders' equity and liabilities |
186,296 |
20,585 |
190,060 |
Condensed Consolidated Cash Flow Statements
In millions |
Jul-Sep |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Cash flow from |
7,673 |
848 |
6,581 |
17,903 |
19,903 |
Intangible and tangible assets acquired |
-2,605 |
-288 |
-1,443 |
-7,050 |
-5,713 |
Free cash flow |
5,068 |
560 |
5,138 |
10,853 |
14,190 |
Cash flow from other investing activities |
92 |
10 |
1,040 |
6,846 |
2,440 |
Total cash flow from investing activities |
-2,513 |
278 |
-403 |
-204 |
-3,273 |
Cash flow before financing activities |
5,160 |
570 |
6,178 |
17,699 |
16,630 |
Cash flow from |
-978 |
-108 |
-7,198 |
-11,968 |
-13,259 |
Cash flow for the period |
4,182 |
462 |
-1,020 |
5,731 |
3,371 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales 1) |
|
|
|
|
Sweden |
10,219 |
10,473 |
30,651 |
31,792 |
Mobile |
3,223 |
3,290 |
9,166 |
9,194 |
Fixed 2) |
6,996 |
7,183 |
21,485 |
22,598 |
Finland |
4,524 |
4,306 |
13,707 |
13,042 |
Mobile |
2,814 |
2,632 |
8,440 |
8,112 |
Fixed 2) |
1,710 |
1,674 |
5,267 |
4,930 |
Norway - mobile |
1,674 |
1,546 |
4,687 |
4,622 |
Denmark |
992 |
835 |
2,908 |
2,242 |
Mobile |
504 |
435 |
1,442 |
1,121 |
Fixed 2) |
488 |
400 |
1,466 |
1,121 |
Baltic countries |
1,502 |
1,516 |
4,373 |
4,399 |
Lithuania - mobile |
542 |
543 |
1,587 |
1,521 |
Lithuania - fixed |
470 |
523 |
1,428 |
1,599 |
Latvia - mobile |
552 |
487 |
1,522 |
1,381 |
Other |
-62 |
-37 |
-164 |
-102 |
Eurasia - mobile |
1,153 |
750 |
2,933 |
1,934 |
Russia |
0 |
0 |
0 |
0 |
International Carrier |
1,009 |
1,096 |
2,962 |
3,872 |
Holding |
360 |
406 |
1,173 |
1,113 |
Corporate |
1 |
1 |
2 |
3 |
Eliminations |
-785 |
-835 |
-2,212 |
-2,301 |
The Group |
20,649 |
20,094 |
61,184 |
60,718 |
1) For information about external net sales per product
area: www.teliasonera.com/ir
2) Including eliminations between fixed and mobile
communications
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
EBITDA |
|
|
|
|
Sweden |
4,340 |
4,539 |
13,161 |
13,354 |
Mobile |
1,505 |
1,497 |
3,903 |
4,266 |
Fixed |
2,835 |
3,042 |
9,258 |
9,088 |
Finland |
1,878 |
1,673 |
5,280 |
5,170 |
Mobile |
1,425 |
1,299 |
3,963 |
3,951 |
Fixed |
453 |
374 |
1,317 |
1,219 |
Norway - mobile |
558 |
622 |
1,540 |
1,949 |
Denmark |
76 |
19 |
213 |
-53 |
Mobile |
8 |
-37 |
27 |
-143 |
Fixed |
68 |
56 |
186 |
90 |
Baltic countries |
767 |
755 |
2,148 |
2,190 |
Lithuania - mobile |
247 |
234 |
706 |
697 |
Lithuania - fixed |
222 |
266 |
679 |
784 |
Latvia - mobile |
302 |
257 |
818 |
731 |
Other |
-4 |
-2 |
-55 |
-22 |
Eurasia - mobile |
692 |
449 |
1,707 |
1,086 |
Russia |
0 |
0 |
0 |
0 |
Turkey |
1 |
0 |
1 |
0 |
International Carrier |
15 |
-244 |
18 |
-188 |
Holding |
118 |
26 |
499 |
-18 |
Corporate |
-194 |
-247 |
-665 |
-648 |
Eliminations |
46 |
-21 |
-76 |
38 |
The Group |
8,297 |
7,571 |
23,826 |
22,880 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
EBITDA excl. non-recurring items |
|
|
|
|
Sweden |
4,343 |
4,535 |
12,586 |
13,724 |
Mobile |
1,505 |
1,497 |
3,903 |
4,266 |
Fixed |
2,838 |
3,038 |
8,683 |
9,458 |
Finland |
1,886 |
1,673 |
5,293 |
5,185 |
Mobile |
1,425 |
1,299 |
3,963 |
3,951 |
Fixed |
461 |
374 |
1,330 |
1,234 |
Norway - mobile |
558 |
622 |
1,540 |
1,949 |
Denmark |
76 |
19 |
213 |
-53 |
Mobile |
8 |
-37 |
27 |
-143 |
Fixed |
68 |
56 |
186 |
90 |
Baltic countries |
767 |
805 |
2,148 |
2,240 |
Lithuania - mobile |
247 |
234 |
706 |
697 |
Lithuania - fixed |
222 |
316 |
679 |
834 |
Latvia - mobile |
302 |
257 |
818 |
731 |
Other |
-4 |
-2 |
-55 |
-22 |
Eurasia - mobile |
692 |
449 |
1,707 |
1,086 |
Russia |
0 |
0 |
0 |
0 |
Turkey |
1 |
0 |
1 |
0 |
International Carrier |
15 |
54 |
16 |
44 |
Holding |
12 |
25 |
-36 |
-19 |
Corporate |
-183 |
-247 |
-651 |
-648 |
Eliminations |
45 |
-20 |
-78 |
39 |
The Group |
8,212 |
7,915 |
22,739 |
23,547 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Depreciation, amortization and write-downs |
|
|
|
|
Sweden |
-1,173 |
-1,516 |
-3,526 |
-4,670 |
of which amortization of goodwill |
- |
-1 |
- |
-2 |
Finland |
-836 |
-1194 |
-2,515 |
-3,529 |
of which amortization of goodwill |
- |
-370 |
- |
-1,071 |
of which amortization of fair value adjustments |
-207 |
-191 |
-607 |
-569 |
Norway |
-233 |
-494 |
-614 |
-1,566 |
of which amortization of goodwill |
- |
-306 |
- |
-958 |
Denmark |
-136 |
-147 |
-412 |
-474 |
of which amortization of goodwill |
- |
-6 |
- |
-17 |
Baltic countries |
-345 |
-634 |
-1,052 |
-1,705 |
of which amortization of goodwill |
- |
-135 |
- |
-404 |
of which amortization of fair value adjustments |
-6 |
-10 |
-18 |
-31 |
Eurasia |
-133 |
-151 |
-375 |
-443 |
of which amortization of goodwill |
- |
-43 |
- |
-126 |
of which amortization of fair value adjustments |
-2 |
-3 |
-6 |
-7 |
International Carrier |
-150 |
-133 |
-451 |
-415 |
of which amortization of goodwill |
- |
- |
- |
-1 |
Holding |
-7 |
-84 |
-45 |
-227 |
of which amortization of goodwill |
- |
-2 |
- |
-4 |
of which amortization of fair value adjustments |
-2 |
-4 |
-15 |
1 |
Corporate |
-3 |
4 |
-10 |
-8 |
Eliminations |
10 |
12 |
32 |
32 |
The Group |
-3,006 |
-4,337 |
-8,968 |
-13,005 |
of which amortization of goodwill |
- |
-863 |
- |
-2,583 |
of which amortization of fair value adjustments |
-218 |
-208 |
-647 |
-606 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Income from associated |
|
|
|
|
Sweden |
1 |
-2 |
39 |
-4 |
Finland |
-1 |
18 |
-2 |
27 |
Denmark |
0 |
0 |
1 |
0 |
Baltic countries |
166 |
156 |
346 |
274 |
Latvia - fixed |
55 |
67 |
175 |
150 |
Share of net income |
36 |
44 |
116 |
85 |
Amortization of goodwill |
- |
3 |
- |
3 |
Amortization of fair value
|
19 |
20 |
59 |
62 |
Estonia - mobile |
75 |
55 |
114 |
85 |
Share of net income |
79 |
77 |
126 |
150 |
Amortization of goodwill |
- |
-18 |
- |
-55 |
Amortization of fair value
|
-4 |
-4 |
-12 |
-10 |
Estonia - fixed |
36 |
32 |
57 |
37 |
Share of net income |
37 |
43 |
61 |
72 |
Amortization of goodwill |
- |
-11 |
- |
-31 |
Amortization of fair value
|
-1 |
0 |
-4 |
-4 |
Eurasia |
- |
- |
- |
- |
Russia |
271 |
177 |
499 |
382 |
Share of net income |
271 |
227 |
499 |
535 |
Amortization of goodwill |
- |
-50 |
- |
-153 |
Turkey |
125 |
207 |
703 |
378 |
Share of net income |
269 |
218 |
587 |
287 |
IFRS adjustments |
-169 |
210 |
177 |
625 |
Amortization of goodwill |
- |
-174 |
- |
-420 |
Amortization of fair value
|
25 |
-47 |
-61 |
-114 |
Holding |
807 |
-137 |
1,049 |
-1,174 |
Share of net income |
271 |
-185 |
528 |
-346 |
Capital gains/losses |
536 |
-12 |
588 |
338 |
Write-downs |
0 |
-41 |
-67 |
-1,272 |
Amortization of goodwill |
- |
101 |
- |
-106 |
Amortization of fair value
|
0 |
0 |
0 |
0 |
Corporate |
0 |
0 |
0 |
0 |
Eliminations |
-1 |
0 |
0 |
0 |
The Group |
1,369 |
419 |
2,635 |
-117 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Operating income |
|
|
|
|
Sweden |
3,169 |
3,021 |
9,675 |
8,680 |
Finland |
1,041 |
497 |
2,763 |
1,667 |
Norway |
325 |
128 |
926 |
383 |
Denmark |
-59 |
-126 |
-198 |
-526 |
Baltic countries |
589 |
277 |
1,442 |
759 |
Eurasia |
559 |
298 |
1,332 |
643 |
Russia |
271 |
177 |
499 |
382 |
Turkey |
125 |
206 |
704 |
377 |
International Carrier |
-135 |
-376 |
-433 |
-603 |
Holding |
918 |
-194 |
1,503 |
-1,418 |
Corporate |
-198 |
-242 |
-676 |
-656 |
Eliminations |
57 |
-13 |
-44 |
70 |
The Group |
6,660 |
3,653 |
17,493 |
9,758 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Operating income excl. |
|
|
|
|
Sweden |
3,173 |
3,019 |
9,100 |
9,053 |
Finland |
1,049 |
868 |
2,776 |
2,754 |
Norway |
367 |
435 |
968 |
1,370 |
Denmark |
-59 |
-121 |
-198 |
-509 |
Baltic countries |
589 |
598 |
1,442 |
1,406 |
Eurasia |
559 |
341 |
1,332 |
769 |
Russia |
271 |
227 |
499 |
535 |
Turkey |
125 |
380 |
704 |
797 |
International Carrier |
-112 |
-50 |
-356 |
-342 |
Holding |
67 |
-252 |
223 |
-613 |
Corporate |
-185 |
-242 |
-661 |
-656 |
Eliminations |
54 |
-13 |
-46 |
70 |
The Group |
5,898 |
5,190 |
15,783 |
14,634 |
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
CAPEX |
|
|
|
|
Sweden |
997 |
588 |
2,804 |
1,884 |
Finland |
492 |
458 |
1,637 |
1,449 |
Norway |
179 |
128 |
406 |
479 |
Denmark |
125 |
91 |
253 |
234 |
Baltic countries |
161 |
159 |
468 |
534 |
Eurasia |
586 |
263 |
1,237 |
642 |
International Carrier |
53 |
117 |
140 |
209 |
Holding |
8 |
88 |
36 |
189 |
Corporate |
0 |
-3 |
3 |
4 |
Eliminations |
-2 |
0 |
-2 |
0 |
The Group |
2,599 |
1,889 |
6,982 |
5,624 |
|
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Number of employees |
|
|
|
|
Sweden |
|
|
|
|
At the end of the period |
11,150 |
11,034 |
11,150 |
11,034 |
Average for the period |
9,525 |
10,171 |
10,128 |
10,439 |
Finland |
|
|
|
|
At the end of the period |
6,753 |
6,106 |
6,753 |
6,106 |
Average for the period |
6,463 |
5,858 |
6,410 |
5,880 |
Norway |
|
|
|
|
At the end of the period |
708 |
713 |
708 |
713 |
Average for the period |
709 |
720 |
715 |
716 |
Denmark |
|
|
|
|
At the end of the period |
1,044 |
1,033 |
1,044 |
1,033 |
Average for the period |
1,021 |
980 |
1,011 |
1,010 |
Baltic countries |
|
|
|
|
At the end of the period |
4,319 |
4,850 |
4,319 |
4,850 |
Average for the period |
4,197 |
4,554 |
4,302 |
5,124 |
Eurasia |
|
|
|
|
At the end of the period |
1,206 |
1,027 |
1,206 |
1,027 |
Average for the period |
1,158 |
955 |
1,109 |
961 |
Russia |
|
|
|
|
At the end of the period |
1 |
1 |
1 |
1 |
Average for the period |
1 |
1 |
1 |
1 |
Turkey |
|
|
|
|
At the end of the period |
3 |
3 |
3 |
3 |
Average for the period |
3 |
3 |
3 |
3 |
International Carrier |
|
|
|
|
At the end of the period |
536 |
620 |
536 |
620 |
Average for the period |
540 |
588 |
542 |
704 |
Holding |
|
|
|
|
At the end of the period |
299 |
537 |
299 |
537 |
Average for the period |
449 |
578 |
584 |
861 |
Corporate |
|
|
|
|
At the end of the period |
293 |
292 |
293 |
292 |
Average for the period |
289 |
237 |
288 |
257 |
The Group |
|
|
|
|
At the end of the period |
26,312 |
26,216 |
26,312 |
26,216 |
Average for the period |
24,355 |
24,645 |
25,093 |
25,956 |
Quarterly Data
SEK in millions, except per share data |
Jul-Sep |
Apr-Jun |
Jan-Mar |
Oct-Dec |
Jul-Sep |
Net sales |
20,649 |
20,589 |
19,946 |
21,054 |
20,094 |
EBITDA |
8,297 |
7,938 |
7,591 |
7,442 |
7,571 |
Depreciation, amortization and write-downs |
-3,006 |
-2,969 |
-2,993 |
-4,559 |
-4,337 |
Income from associated companies |
1,369 |
681 |
585 |
499 |
419 |
Operating income |
6,660 |
5,650 |
5,183 |
3,382 |
3,653 |
Income after financial items |
5,985 |
5,489 |
4,895 |
3,100 |
3,353 |
Net income |
4,320 |
3,148 |
3,405 |
2,696 |
1,792 |
Earnings per share |
|
|
|
|
|
Basic (SEK) |
0.92 |
0.67 |
0.73 |
0.58 |
0.38 |
Diluted (SEK) |
0.92 |
0.67 |
0.73 |
0.58 |
0.38 |
Investments |
3,075 |
2,683 |
2,051 |
4,474 |
1,899 |
of which CAPEX |
2,599 |
2,625 |
1,758 |
3,336 |
1,889 |
Cash flow from operating activities |
7,673 |
6,246 |
3,984 |
6,651 |
6,581 |
Free cash flow |
5,068 |
3,591 |
2,194 |
3,309 |
5,138 |
|
|
|
|
|
|
EBITDA excl. non-recurring items |
8,212 |
7,327 |
7,200 |
7,143 |
7,915 |
Operating income excl. non-recurring items and GWA |
5,898 |
5,063 |
4,822 |
4,178 |
5,190 |
*) Restated
Non-Recurring Items
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Within EBITDA |
84 |
-344 |
1,087 |
-667 |
Restructuring charges, synergy implementation costs, etc.: Sweden |
-4 |
4 |
-18 |
-370 |
Finland |
-8 |
- |
-13 |
-15 |
Lithuania fixed |
- |
-50 |
- |
-50 |
International Carrier |
-5 |
-357 |
16 |
-357 |
Corporate |
-11 |
- |
-13 |
- |
Revised treatment of certain pension-related costs: Sweden |
- |
- |
593 |
- |
Provisions (FX rate effect): International Carrier |
5 |
59 |
-14 |
125 |
Capital gains: Telia Finans |
- |
- |
429 |
- |
Sonera Zed |
107 |
- |
107 |
- |
Within Depreciation, amortization and write-downs |
-67 |
-139 |
-122 |
-168 |
Accelerated depreciation: International Carrier |
-24 |
- |
-74 |
- |
Norway |
-43 |
- |
-43 |
- |
Write-downs: Lithuania fixed |
- |
-110 |
- |
-110 |
International Carrier |
- |
-29 |
-5 |
-29 |
Other |
- |
- |
- |
-29 |
Within Income from associated companies |
745 |
-41 |
745 |
-908 |
Capital gains/losses: Bharti Mobile |
- |
- |
- |
341 |
Write-downs: Metro One |
- |
-41 |
- |
-151 |
Infonet |
- |
- |
- |
-1,028 |
Provisions and other: Telefos |
745 |
- |
745 |
- |
INGROUP, etc. |
- |
- |
- |
-70 |
Within Financial revenues and expenses |
-498 |
-31 |
-609 |
191 |
Capital gains/losses: Netia |
- |
11 |
- |
594 |
Other financial investments |
- |
-42 |
- |
-42 |
Write-downs: Xfera (3G Spain) |
- |
- |
-111 |
- |
Other financial investments |
- |
- |
- |
-361 |
Provisions: Xfera (3G Spain) |
-498 |
- |
-498 |
- |
Total |
264 |
-555 |
1,101 |
-1,552 |
In thousands |
Sep 30, |
Jun 30, |
Mar 31, |
Dec 31, |
Sep 30, |
Consolidated operations |
|
|
|
|
|
Mobile |
13,636 |
12,891 |
12,397 |
11,957 |
11,491 |
Sweden |
4,266 |
4,115 |
4,008 |
3,838 |
3,760 |
Finland |
2,264 |
2,266 |
2,321 |
2,428 |
2,441 |
Norway |
1,249 |
1,239 |
1,190 |
1,195 |
1,191 |
Denmark |
558 |
556 |
544 |
525 |
504 |
Lithuania |
1,226 |
1,139 |
1,101 |
1,052 |
965 |
Latvia |
614 |
575 |
554 |
534 |
507 |
Eurasia |
3,459 |
3,001 |
2,679 |
2,385 |
2,123 |
|
|
|
|
|
|
Internet |
1,811 |
1,759 |
1,738 |
1,686 |
1,605 |
Sweden |
1,277 |
1,245 |
1,239 |
1,222 |
1,185 |
of which broadband |
472 |
440 |
423 |
399 |
380 |
Finland |
338 |
323 |
314 |
299 |
274 |
of which broadband |
214 |
189 |
174 |
150 |
119 |
Denmark, broadband |
120 |
117 |
113 |
104 |
96 |
Lithuania |
76 |
74 |
72 |
61 |
50 |
of which broadband |
40 |
34 |
31 |
25 |
18 |
|
|
|
|
|
|
Cable TV, Denmark |
198 |
196 |
196 |
195 |
192 |
|
|
|
|
|
|
Fixed voice |
7,937 |
8,000 |
8,042 |
8,087 |
8,027 |
Sweden |
6,173 |
6,209 |
6,248 |
6,283 |
6,330 |
Finland |
760 |
779 |
790 |
804 |
691 |
Denmark |
183 |
188 |
179 |
172 |
170 |
Lithuania |
821 |
824 |
825 |
828 |
836 |
|
|
|
|
|
|
Associated companies |
|
|
|
|
|
Mobile |
32,944 |
29,277 |
27,089 |
24,867 |
22,982 |
Estonia |
557 |
531 |
502 |
492 |
464 |
Russia |
11,487 |
9,046 |
7,587 |
6,175 |
5,318 |
Turkey 2) |
20,900 |
19,700 |
19,000 |
18,200 |
17,200 |
|
|
|
|
|
|
Internet |
96 |
91 |
86 |
76 |
66 |
Latvia, broadband |
28 |
25 |
23 |
19 |
15 |
Estonia |
68 |
66 |
63 |
57 |
51 |
|
|
|
|
|
|
Fixed voice |
1,063 |
1,076 |
1,089 |
1,099 |
1,103 |
Latvia |
636 |
644 |
652 |
654 |
657 |
Estonia |
427 |
432 |
437 |
445 |
446 |
1) For further
operational data: www.teliasonera.com/ir
2) Turkcell
figures are reported with a one-quarter lag
Condensed Consolidated Income Statements
SEK in millions, except per share data and number of shares |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net sales |
20,649 |
20,094 |
61,184 |
61,371 |
Costs of production |
-10,714 |
-11,410 |
-31,746 |
-34,485 |
Gross income |
9,935 |
8,684 |
29,438 |
26,886 |
Selling, admin., and R&D expenses |
-4,930 |
-5,220 |
-15,427 |
-16,655 |
Other operating revenues and expenses, net |
286 |
-230 |
847 |
1,214 |
Income from associated companies |
1,369 |
419 |
2,635 |
-117 |
Operating income |
6,660 |
3,653 |
17,493 |
11,328 |
Net financial revenues and expenses |
-675 |
-300 |
-1,124 |
-529 |
Income after financial items |
5,985 |
3,353 |
16,369 |
10,799 |
Income taxes |
-1,246 |
-1,339 |
-4,514 |
-3,734 |
Minority interests |
-419 |
-222 |
-982 |
-681 |
Net income |
4,320 |
1,792 |
10,873 |
6,384 |
Earnings per share (SEK) |
|
|
|
|
Basic |
0.92 |
0.38 |
2.33 |
1.37 |
Diluted |
0.92 |
0.38 |
2.33 |
1.37 |
Weighted average number of shares (thousands) |
|
|
|
|
Basic |
4,675,232 |
4,675,232 |
4,675,232 |
4,665,053 |
Diluted |
4,675,232 |
4,676,165 |
4,675,232 |
4,665,818 |
1) Including Telia's Finnish mobile operations and Swedish cable TV operations through May 31, 2003.
Condensed Consolidated Balance Sheets
SEK in millions |
Sep 30, |
Dec 31, |
Assets |
|
|
Intangible fixed assets |
61,615 |
61,820 |
Tangible fixed assets |
47,824 |
49,161 |
Financial fixed assets |
37,723 |
42,061 |
Total fixed assets |
147,162 |
153,042 |
Inventories, etc. |
521 |
501 |
Receivables |
20,593 |
24,170 |
Short-term investments |
13,775 |
8,658 |
Cash and bank |
4,245 |
3,689 |
Total current assets |
39,134 |
37,018 |
Total assets |
186,296 |
190,060 |
|
|
|
Shareholders' equity and liabilities |
|
|
Shareholders' equity |
119,095 |
112,393 |
Minority interests |
3,785 |
3,441 |
Provisions for pensions and employee contracts |
619 |
522 |
Deferred tax liability, other provisions |
14,086 |
14,775 |
Total provisions |
14,705 |
15,297 |
Long-term loans |
12,027 |
25,867 |
Short-term loans |
11,736 |
4,687 |
Non-interest-bearing liabilities |
24,948 |
28,375 |
Total liabilities |
48,711 |
58,929 |
Total equity and liabilities |
186,296 |
190,060 |
Condensed Consolidated Cash Flow Statements
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Cash flow before change in working capital |
7,784 |
5,415 |
18,982 |
20,820 |
Change in working capital |
-111 |
1,166 |
-1,079 |
-1,028 |
Cash flow from operating activities |
7,673 |
6,581 |
17,903 |
19,792 |
Intangible and tangible fixed assets acquired (cash CAPEX) |
-2,605 |
-1,443 |
-7,050 |
-5,750 |
Free cash flow |
5,068 |
5,138 |
10,853 |
14,042 |
Cash flow from other investing activities |
92 |
1,040 |
6,846 |
4,755 |
Total cash flow from investing activities |
-2,513 |
-403 |
-204 |
-995 |
Cash flow before financing activities |
5,160 |
6,178 |
17,699 |
18,797 |
Cash flow from financing activities |
-978 |
-7,198 |
-11,968 |
-15,509 |
Cash flow for the period |
4,182 |
-1,020 |
5,731 |
3,288 |
|
|
|
|
|
Cash and cash equivalents,
|
13,669 |
9,718 |
12,069 |
5,465 |
of which short-term investments up to and including three months |
10,633 |
6,239 |
8,380 |
2,634 |
of which cash and bank |
3,036 |
3,479 |
3,689 |
2,831 |
Cash flow for the period |
4,182 |
-1,020 |
5,731 |
3,288 |
Exchange rate differences in cash and cash equivalents |
-70 |
-133 |
-19 |
-188 |
Cash and cash equivalents,
|
17,781 |
8,565 |
17,781 |
8,565 |
of which short-term investments up to and including three months |
13,536 |
5,213 |
13,536 |
5,213 |
of which cash and bank |
4,245 |
3,352 |
4,245 |
3,352 |
|
|
|
|
|
Net interest-bearing
liability, |
8,286 |
17,159 |
8,847 |
25,034 |
Change in net borrowings |
-4,789 |
-5,524 |
-5,394 |
-13,270 |
Change in pension provisions |
53 |
29 |
97 |
-100 |
Net interest-bearing
liability, |
3,550 |
11,664 |
3,550 |
11,664 |
Condensed Consolidated Statements of Changes in Shareholders' Equity
SEK in millions |
Sep 30, |
Dec 31, |
Opening balance |
112,393 |
108,829 |
Transactions with outside parties |
-11 |
-13 |
Differences arising from translation of foreign operations |
-1,150 |
-8,101 |
Inflation adjustments |
1,625 |
2,427 |
Fair value measurement of securities available for sale |
51 |
- |
Gains/losses on instruments used to hedge cash flow |
-11 |
-10 |
Dividend |
-4,675 |
-1,870 |
New share issue |
- |
2,051 |
Net income for the period |
10,873 |
9,080 |
Closing balance |
119,095 |
112,393 |
Long-Lived Assets
|
Goodwill |
Other intangibles |
Tangibles | |||
SEK in millions |
Sep 30, 2004 |
Dec 31, 2003 |
Sep 30, 2004 |
Dec 31, 2003 |
Sep 30, 2004 |
Dec 31, 2003 |
Opening balance |
52,922 |
58,584 |
8,898 |
9,522 |
49,161 |
56,172 |
Purchases |
473 |
1,902 |
507 |
1,292 |
6,516 |
8,446 |
Operations acquired |
- |
- |
1 |
30 |
249 |
255 |
Dismantling/restoration |
- |
- |
- |
- |
- |
106 |
Sales/discards |
-1 |
- |
-28 |
-131 |
-71 |
-356 |
Operations divested |
-46 |
- |
-22 |
-5 |
-186 |
-1,420 |
Reclassifications |
-2 |
-458 |
320 |
432 |
-336 |
-455 |
Amortization, depreciation |
- |
-3,450 |
-1,336 |
-1,686 |
-7,623 |
-11,872 |
Write-downs, reversals of write-downs |
-16 |
-38 |
-11 |
-301 |
-5 |
-332 |
CAPEX contribution from CATV customers |
- |
- |
- |
- |
- |
74 |
Advances |
- |
- |
2 |
0 |
20 |
49 |
Inflation adjustments |
- |
- |
- |
- |
- |
-7 |
Exchange rate differences |
-82 |
-3,618 |
36 |
-255 |
99 |
-1,499 |
Closing balance |
53,248 |
52,922 |
8,367 |
8,898 |
47,824 |
49,161 |
Investments
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
CAPEX |
2,599 |
1,889 |
6,982 |
6,037 |
Intangible fixed assets |
217 |
110 |
509 |
743 |
Tangible fixed assets |
2,382 |
1,779 |
6,473 |
5,294 |
Acquisitions |
476 |
10 |
827 |
1,468 |
Goodwill and other fair value adjustments |
372 |
0 |
548 |
1,256 |
Shares and participations |
104 |
10 |
279 |
212 |
Total |
3,075 |
1,899 |
7,809 |
7,505 |
Net Interest-Bearing Liability
SEK in millions |
Sep 30, |
Dec 31, |
Long-term and short-term loans |
23,763 |
30,554 |
Less: Short-term investments, cash and bank |
-18,020 |
-12,347 |
Net debt |
5,743 |
18,207 |
Less: Interest-bearing financial assets |
-1,744 |
-6,112 |
Interest-bearing receivables |
-1,068 |
-3,770 |
Total net borrowings |
2,931 |
8,325 |
Provisions for pensions |
619 |
522 |
Total net interest-bearing liability |
3,550 |
8,847 |
Financial Instruments
|
Sep 30, |
Sep 30, |
Dec 31, |
Dec 31, |
SEK in millions |
Book value |
Fair value |
Book value |
Fair value |
Equity participations in associated companies |
22,249 |
28,726 |
20,401 |
23,315 |
Other holdings of securities |
469 |
469 |
558 |
558 |
Other long- and short-term receivables |
1,844 |
1,844 |
8,824 |
8,736 |
Short-term investments |
239 |
239 |
278 |
278 |
Interest rate swaps received |
5,694 |
5,694 |
2,178 |
2,178 |
Interest rate swaps paid |
-5,518 |
-5,518 |
-2,084 |
-2,084 |
FX interest rate swaps received |
5,503 |
5,503 |
5,989 |
5,989 |
FX interest rate swaps paid |
-5,180 |
-5,180 |
-5,583 |
-5,583 |
Other currency derivatives |
29 |
29 |
84 |
84 |
Total assets |
25,329 |
31,806 |
30,645 |
33,471 |
Provisions for pensions |
619 |
619 |
522 |
522 |
Long-term loans |
11,987 |
12,170 |
25,940 |
27,023 |
Short-term loans |
11,712 |
12,170 |
4,686 |
4,710 |
Interest rate swaps received |
-1,308 |
-1,308 |
-1,314 |
-1,314 |
Interest rate swaps paid |
1,431 |
1,431 |
1,442 |
1,442 |
FX interest rate swaps received |
-1,564 |
-1,564 |
-1,795 |
-1,795 |
FX interest rate swaps paid |
1,707 |
1,707 |
1,927 |
1,927 |
Other currency derivatives |
53 |
53 |
85 |
85 |
Total liabilities |
24,637 |
25,278 |
31,493 |
32,600 |
Less book value of: |
|
|
|
|
- pensions |
-619 |
|
-522 |
|
- accrued interest |
-202 |
|
-332 |
|
- other currency derivatives |
-53 |
|
-85 |
|
Book value of interest-bearing liabilities |
23,763 |
|
30,554 |
|
|
|
|
|
|
FX swaps/forward contracts (portfolio) |
|
|
|
|
Purchases of foreign currency |
9,085 |
9,085 |
15,030 |
15,030 |
Sales of foreign currency |
2,899 |
2,899 |
5,075 |
5,075 |
Deferred Tax
SEK in millions |
Sep 30, |
Dec 31, |
Deferred tax liability |
8,432 |
8,537 |
Deferred tax asset |
-12,567 |
-14,960 |
Net deferred tax asset (-)/liability (+) |
-4,135 |
-6,423 |
Contingent Assets and Contingent Liabilities
SEK in millions |
Sep 30, |
Dec 31, |
Contingent assets |
- |
- |
|
|
|
Collateral pledged |
|
|
Real estate mortgages |
20 |
20 |
Chattel mortgages |
- |
262 |
Shares in subsidiaries |
- |
570 |
Shares in associated companies |
525 |
642 |
Current receivables |
38 |
36 |
Blocked funds in bank accounts |
1,265 |
1,259 |
Total |
1,848 |
2,789 |
|
|
|
Contingent liabilities |
|
|
Credit guarantees, associated companies |
1,055 |
726 |
Performance guarantees, associated companies and other minority holdings |
742 |
1,159 |
Other guarantees, etc. |
713 |
1,038 |
FPG/PRI, other pension guarantees |
176 |
176 |
Total |
2,686 |
3,099 |
TeliaSonera has a dispute with Tele2 and Vodafone concerning interconnect prices in Sweden. TeliaSonera believes that it has recorded sufficient provisions.
Contractual Obligations
SEK in millions |
Sep 30, |
Dec 31, |
Intangible fixed assets |
18 |
40 |
Tangible fixed assets |
2,458 |
2,140 |
Indefeasible Rights of Use (IRU) |
3 |
- |
Subsidiaries |
5,551 |
- |
Associated companies and other minority holdings |
1,980 |
3,093 |
Total |
10,010 |
5,273 |
Basis for Presentation
General. As in the annual accounts for 2003, TeliaSonera's consolidated financial statements as of and for the three-month and nine-month periods ended September 30, 2004, have been prepared in accordance with International Financial Reporting Standards (IFRS). The parent company TeliaSonera AB's financial statements have been prepared in accordance with the Annual Accounts Act and other Swedish regulations. This report has been prepared in accordance with IAS 34 "Interim Financial Reporting."
New accounting standards. Between December 17, 2003 and May 27, 2004, a number of new standards, several revised standards and one new interpretation were published (see details in the Q2 Interim Report). One former standard was withdrawn and the revisions superseded a number of previously published interpretations (see details in the Q1 Interim Report).
TeliaSonera's future adoption of IFRS 2, IFRS 4, IFRS 5 and of the revisions to IAS 2, IAS 8, IAS 10, IAS 16, IAS 17, IAS 21, IAS 24, IAS 28, IAS 31, IAS 32, IAS 33 and IAS 39, as well as the adoption of IFRIC 1, will not entail any restatements of comparative figures. When adopting IAS 1 and IAS 27, TeliaSonera will have to recognize the share of equity owned by external shareholders not as a separate line item on the face of the balance sheet but as a separate component within shareholders' equity. Likewise, the minority share of income will not be recognized as a separate line item on the face of the income statement but as a disclosure on the face of the income statement of the allocation of profit or loss for the period. TeliaSonera does not own assets of the type regulated by IAS 40.
Adoption of IFRS 3 and of the revisions to IAS 36 and IAS 38 involves, among other things, that goodwill and other intangible assets with indefinite useful life will no longer be amortized but tested for impairment at least annually and that the minority interest should include minority shareholders' part of the fair value of assets acquired and liabilities assumed. TeliaSonera has decided to adopt IFRS 3 as of January 1, 2004 (see "Restated quarterly data" below).
Change in estimates. Effective January 1, 2004, the depreciation rate for copper cables in the fixed local access network in Sweden has been changed from 8 years to 20 years and for switching equipment for ADSL customers from 3 years to 10 years.
Restated segment reporting. Some adjustments of TeliaSonera's business organization were implemented in the first nine months of 2004. Hence, segment information in this report has been restated.
Restated quarterly data. In the fourth quarter of 2003, TeliaSonera finalized the allocation of goodwill to the various businesses acquired directly and indirectly in the merger with Sonera. The final allocation resulted, among others, in a reduction of goodwill related to the Turkcell shares, increasing operating income in 2003 by SEK 291 million. The adjustments were retroactively reflected in all quarters. In the second quarter of 2004, TeliaSonera decided to retrospectively adopt IFRS 3 as of January 1, 2004. The adoption impacted the first quarter results for 2004.
Restatements SEK in millions |
Jan-Mar |
Oct-Dec |
Jul-Sep |
Apr-Jun |
Jan-Mar |
Depreciation, amortization and write-downs |
830 |
- |
- |
- |
- |
Income from associated companies |
231 |
64 |
93 |
73 |
61 |
Operating income |
1,061 |
64 |
93 |
73 |
61 |
Income after financial items |
1,061 |
64 |
93 |
73 |
61 |
Income taxes |
- |
-25 |
-36 |
-28 |
-24 |
Net income |
1,061 |
39 |
57 |
45 |
37 |
Changes in Group Composition
Metro One. On January 14,
2004, TeliaSonera sold its remaining shareholding in Metro One
Telecommunications, Inc.
INGROUP. On February 20, 2004, the shareholders of INGROUP Holding AB, including TeliaSonera holding a 37 percent stake, sold all of their shares to Manpower.
Zed. On January 13, 2004, Yahoo!, sold back its 16 percent holding in Sonera Zed Oy to TeliaSonera, whereby Zed became a wholly owned subsidiary of TeliaSonera. On September 10, 2004, TeliaSonera sold Zed to the Spanish interactive media group Wisdom Entertainment.
Eutelsat. TeliaSonera's minority holding in the satellite company Eutelsat S.A. was sold in February 2004.
Telia Finans. On March 1, 2004, TeliaSonera sold its wholly owned subsidiary, the Swedish leasing company Telia Finans AB, to De Lage Landen International B.V.
Sturenportti. On February 27, 2004, TeliaSonera purchased all shares in the real estate company Kiinteistö Oy Sturenportti from Sonera Pension Fund.
Omnitel. On August 17, 2004, TeliaSonera acquired 10 percent of the shares in UAB Omnitel of Lithuania from the Kazickas family, making Omnitel fully owned by TeliaSonera.
Orange Denmark. On October 11, 2004, TeliaSonera acquired France Telecom's Danish subsidiary, the mobile operator Orange A/S.
Related Party TransactionsLattelekom. TeliaSonera holds a participating interest in Lattelekom SIA. In the three-month period ended September 30, 2004, TeliaSonera sold services and products to Lattelekom worth SEK 34 million and purchased services and products worth SEK 21 million. In the nine-month period ended September 30, 2004, TeliaSonera sold services and products worth SEK 91 million and purchased services and products worth SEK 56 million.
MegaFon. TeliaSonera holds a participating interest in OAO MegaFon. As of September 30, 2004, TeliaSonera had interest-bearing and non-interest-bearing claims on MegaFon of SEK 360 million.
Infonet. TeliaSonera owns a participating interest in Infonet Services Corp. In the three-month period ended September 30, 2004, TeliaSonera sold services and products to Infonet worth SEK 13 million and purchased services and products worth SEK 17 million. In the nine-month period ended September 30, 2004, TeliaSonera sold services and products worth SEK 28 million and purchased services and products worth SEK 92 million.
Telefos. TeliaSonera owns 49 percent of the shares in Telefos AB. As of September 30, 2004, TeliaSonera had interest-bearing claims on the Telefos Group of SEK 306 million and had signed guarantees of SEK 100 million for commitments made by Telefos companies. In the three-month period ended September 30, 2004, TeliaSonera sold services and products worth SEK 100 million to the Telefos Group and purchased services and products worth SEK 422 million. In the nine-month period ended September 30, 2004, TeliaSonera sold services and products worth SEK 151 million and purchased services and products worth SEK 1,459 million. Some services purchased by TeliaSonera referred to construction of fixed assets.
Other relationships. In addition to those specified, TeliaSonera buys and sells services and products to a limited extent from these and other associated companies, in all cases on market terms.
Loan FinancingStock Option Schemes
Summarized information about warrants outstanding as of
September 30, 2004 by exercise price is as follows.
|
Outstanding |
Of which exercisable | ||
Exercise price (SEK) |
Number of warrants |
Remaining contractual life (years) |
Number of warrants |
Remaining contractual life (years) |
69.00 |
12,250,000 |
0.67 |
12,250,000 |
0.67 |
70.62 |
5,956,650 |
0.75 |
5,956,650 |
0.75 |
On September 30, 2004, the closing price for the TeliaSonera share on the Stockholm Stock Exchange was SEK 35.40. Detailed information regarding the stock option schemes is presented in TeliaSonera's Annual Report for 2003. Please also refer to the Q2 Interim Report for changes in 2004. If fully exercised, the outstanding stock options will entail a share capital increase of approximately SEK 68 million, equal to a 0.5 percent increase in the number of shares.
Swedish GAAPTranslation into Swedish GAAP. Application of Swedish GAAP affects consolidated net income and shareholders' equity as follows.
SEK in millions |
Jul-Sep |
Jul-Sep |
Jan-Sep |
Jan-Sep |
Net income under IFRS |
4,320 |
1,792 |
10,873 |
6,384 |
Amortization of goodwill, fair value adjustments |
-862 |
- |
-2,591 |
- |
Write-up of tangible fixed assets |
-197 |
- |
-596 |
- |
Goodwill amortization, associated companies |
-195 |
- |
-706 |
- |
Pension-related taxes |
7 |
- |
-586 |
- |
Deferred tax |
53 |
- |
331 |
- |
Net income under Swedish GAAP |
3,126 |
1,792 |
6,725 |
6,384 |
SEK in millions |
Sep 30, 2004 |
Dec 31, 2003 |
Shareholders' equity under IFRS |
119,095 |
112,393 |
Amortization of goodwill, fair value adjustments |
-2,591 |
- |
Write-up of tangible fixed assets |
4,353 |
4,949 |
Goodwill amortization, associated companies |
-706 |
- |
Pension-related taxes |
-586 |
- |
Deferred tax |
-1,055 |
-1,386 |
Exchange rate difference |
25 |
- |
Shareholders' equity under Swedish GAAP |
118,535 |
115,956 |
Finnish GAAP
The following information is provided pursuant to the
Finnish Financial Supervision Authority decision no. 28/269/2002.
This interim report has been prepared in accordance with chapter 2, section 5 of the Finnish Securities Markets Act. TeliaSonera prepares its consolidated financial statements in accordance with IFRS. The main differences between Finnish Accounting Standards (Finnish GAAP) and IFRS, relevant to TeliaSonera, are described in TeliaSonera's Annual Report for 2003. As discussed above, TeliaSonera decided to adopt IFRS 3 as of January 1, 2004, involving among other things that goodwill is no longer amortized. Finnish GAAP require amortization of goodwill. Otherwise, there were no material additional differences in the first nine months of 2004.
Parent CompanyThe balance sheet total increased to SEK 141,261 million (137,112 at year-end). Shareholders' equity decreased to SEK 95,400 million (96,269 at year-end). Retained earnings amounted to SEK 22,759 million (23,209).
Cash flow from operating activities improved to SEK 7,832 million (6,088) and cash flow before financing activities to SEK 15,828 million (10,835). Net borrowings increased to SEK 3,960 million (3,196 at year-end). Cash and cash equivalents totaled SEK 14,569 million (8,809).
The equity/assets ratio (including the equity component of untaxed reserves) was 73.6 percent (74.2 at year-end).
Total investments for the nine-month period amounted to SEK 5,651 million (4,419), including SEK 1,961 million (1,498) in tangible fixed assets, primarily fixed-line installations. Other investments totaling SEK 3,690 million (2,921, of which SEK 2,581 million reflected purchase price consideration for Sonera) were primarily attributable to capital infusions in subsidiaries and associated companies. Of the capital infusions to subsidiaries, SEK 9 million (46) was provided through debt conversion.
Due to operations acquired, the number of employees as of September 30, 2004 was 3,910 compared to 2,982 at year-end.
Financial Information/"Underlying" Measures of Results of OperationsThese "underlying" measures, however, should not be considered as alternatives to operating income as indicators of our operating performance. Similarly, EBITDA excluding non-recurring items should not be considered as an alternative to cash flows from operating activities as a measure of liquidity. EBITDA excluding non-recurring items and operating income excluding non-recurring items are not measures of consolidated financial performance under IFRS or U.S. GAAP and may not be comparable to other similarly titled measures for other companies. These "underlying" measures are not meant to be predictive of potential future results.
Forward-Looking Statements