Strengthening B2B convergence

Net sales in reported currency increased 5.4 percent to SEK 13,742 million (13,042). In local currency excluding acquisitions and disposals the increase was 2.1 percent, mainly due to a strong development in the consumer segment. Service revenues grew 1.5 percent in local currency, excluding acquisitions and disposals, as growth in mobile billed revenues more than compensated for a continued pressure on legacy revenues. Growth in mobile billed revenues was driven by higher ARPU following new price plans together with good performance on upsell and customer portfolio management.

In order to further strengthen the B2B convergence proposition, the ICT company Nebula and the identity and access rights specialist company Propentus were acquired. The companies will, together with the open data center that is currently being built in Helsinki, strengthen Telia’s leading position in the Finnish B2B segment, and support the customers on their digital journeys. On the consumer segment side, an investment in content was made when the TV rights for the Finnish ice hockey league (Liiga) were acquired, the agreement stretches over six years, the cash flow effect will start in the second half of 2018. The rights are valid from the second half of 2018 and will improve Telia’s already strong TV offering and increase customer loyalty.

Adjusted EBITDA in local currency excluding acquisitions and disposals, increased 0.7 percent. The positive revenue development was partly offset by higher marketing spend where rebranding drove costs in the first two quarters. The adjusted EBITDA margin decreased to 30.8 percent (31.1).

CAPEX increased to SEK 3,116 million (1,832), impacted by the acquisition of TV rights for the Finnish ice hockey league (Liiga).

During the year, the number of TV subscriptions decreased by 8,000. Mobile, fixed telephony and broadband subscriptions decreased by 32,000, 15,000, and 33,000, respectively, the latter due to customers abandoning fixed broadband in favour of mobile services.

SEK in millions,
except margins, operational data and changes

Jan–Dec
2017

Jan–Dec
2016

Chg

(%)

Net sales

13,742

13,042

5.4

Change (%) local organic

2.1

   

of which service revenues (external)

11,748

11,197

4.9

change (%) local organic

1.5

   

Adjusted EBITDA

4,232

4,059

4.3

Margin (%)

30.8

31.1

 

change (%) local organic

0.7

   

Adjusted operating income

2,087

2,086

0.1

CAPEX excluding license and spectrum fees

3,116

1,832

70.1

Subscriptions, (thousands)

     

Mobile

3,221

3,253

-1.0

of which machine to machine (postpaid)

186

180

3.4

Fixed telephony

50

65

-23.1

Broadband

464

497

-6.6

TV

481

489

-1.6

Employees

3,107

3,066

1.3