Board of Directors’ report

Telia Company reports its financial results by the two operating segments region Sweden and region Europe. The regions are country-based organizations, and for which certain financial information is reported. Collectively reported as Other operations are the international carrier operations, customer financing and dunning operations, Telia Company Holding, Telia Company’s shareholdings in Russian MegaFon (25 percent) and Turkish Turkcell (38 percent) as well as Group functions. Group functions include Communications, Corporate Development (including M&A), Finance (including Procurement and Real Estate), Human Resources, Legal Affairs, Global Services and Operations, CEO Office, Ethics and Compliance Office and Internal Audit.

The organizational structure changed on January 1, 2017. For more information, see www.teliacompany.com.

In this Report, prior period has been restated to reflect certain classification errors between net sales and cost of sales referring to insurance sales in region Europe. For additional information on restatements, see Note C1.

Former segment region Eurasia is classified as held for sale and discontinued operations since December 31, 2015. The Sergel companies (Sergel) are included in continuing operations but classified as assets held for sale since June 30, 2016. For information on assets held for sale and discontinued operations, see Note C34.

In this Report, comparative figures are provided in parentheses following the operational and financial results and refer to the same item in the full year of 2015, unless otherwise stated.