Third quarter 2010: strengthened growth, margins and outlook
Press Releases:
In the third quarter of 2010, Telenor Group reported revenues of NOK 24.1 billion, representing an organic revenue growth of six per cent. EBITDA before other items was NOK 7.9 billion, EBITDA margin was 33 per cent, and operating cash flow margin was 23 per cent. Telenor's consolidated mobile operations added seven million subscriptions during the quarter.
“Telenor Group delivered yet another strong quarter, with increased organic revenue growth, solid EBITDA margin and an operating cash flow of NOK 5.6 billion,” said Jon Fredrik Baksaas, President and CEO of Telenor Group.
Strong development in Asia
“Our established operations in Asia reached an organic growth in revenues of 13 per cent this quarter with annualised operating cash flow of NOK 9.3 billion. At the same time all market positions were maintained or improved. Telenor Pakistan performed better than we expected following the flooding which has severely affected the country,” Baksaas said.
“I am pleased to see promising development for Uninor in India this quarter with strong growth in subscriptions and increased average revenue per user. These improvements are a result of a focused market approach and other measures. Going forward we will continue our efforts to increase revenues and improve business processes,” Baksaas said.
Mobile data growth in the Nordic region
“The Nordic region continues to benefit from mobile data growth. However, total revenue growth was impacted by reduced international roaming fees, lower growth in handset revenues and increased competitive pressure. In Norway, we introduced new service offerings in the business segment in October to strengthen our position. Despite the ongoing mobile network modernisation we are delivering an annualised operating cash flow of NOK 10.1 billion. In addition, our broadcast business achieved 4 per cent organic revenue growth combined with strong margins,” Baksaas said
Important agreements
“During the quarter, we are pleased to have entered into important agreements regarding network modernisation and mobile Internet that in the longer term will benefit our customers,” Baksaas said.
Improved outlook for 2010
“Our outlook for 2010 has been revised upwards, as a result of strengthened operational performance, as well as the deconsolidation of EDB Business Partner. We now expect higher organic revenue growth and EBITDA margin, as well as a somewhat reduced capex to sales ratio,” Baksaas said.
Key figures
The table below contains key figures for the third quarter of 2010, compared to the previous year:
| Third quarter | First three quarters | Year | ||||
|---|---|---|---|---|---|---|
| (NOK in millions except earnings per share) | 2010 | 2009 | 2010 | 2009 | 2009 | |
| Revenues | 24 096 | 22 767 | 69 985 | 68 330 | 90 748 | |
| EBITDA before other income and expenses | 7 885 | 7 900 | 22 042 | 23 737 | 30 670 | |
| EBITDA margin before other income and expenses (%) | 32.7 | 36.0 | 31.5 | 34.7 | 33.8 | |
| Adjusted operating profit | 3 891 | 4 601 | 10 053 | 12 619 | 15 765 | |
| Adjusted operating profit/Revenues (%) | 16.1 | 20.2 | 14.4 | 18.5 | 17.4 | |
| Profit after taxes and non-controlling interests 1 | 1 698 | 3 489 | 12 230 | 6 486 | 8 653 | |
| Earnings per share from total operations, basic, in NOK | 1.03 | 2.11 | 7.40 | 3.92 | 5.22 | |
| Capex | 2 302 | 4 430 | 7 905 | 10 267 | 15 722 | |
| Capex excl. licences and spectrum | 2 302 | 4 430 | 7 572 | 10 267 | 15 722 | |
| Capex excl. licences and spectrum/Revenues (%) | 9.6 | 19.5 | 10.8 | 15.0 | 17.3 | |
| Operating cash flow 2 | 5 583 | 3 757 | 14 470 | 13 470 | 14 948 | |
| Net interest-bearing liabilities | 19 787 | 28 628 | 26 332 | |||
For more information please refer to the quarterly report on www.telenor.com/en/investor-relations/reports/q3-2010.
Contact:
Scott Engebrigtsen, Communication Manager, Telenor Group, Tel: +47 90043484, E-mail: scott.engebrigtsen@telenor.com
To the editorial offices:
Press and analyst conference
In connection with the publication of the financial results, a press and analyst conference will be held on Wednesday 27 October 2010 at 09:00 hrs Norwegian time/CET. The presentation will be held in Auditorium A, Telenor Expo Visitors’ Centre, at the Telenor Headquarters at Fornebu outside Oslo. President and CEO Jon Fredrik Baksaas and CFO Richard Olav Aa will present the results. All presentations will be given in English.
Internet and mobile broadcast
The press and analyst conference will be broadcast live over the Internet, and a recorded version will be made available on www.telenor.com/en/investor-relations/reports/q3-2010. During the live transmission, written questions may be submitted via the Internet. The conference will also be available live, and in a recorded version, on mobile phones with 3G, GPRS or EDGE. For more details please refer to www.telenor.com/en/investor-relations/reports/q3-2010.
Conference call and Q&A
The press and analyst conference will also be available as a conference call. This service also allows participants to ask questions at a concluding Q&A session, which will be held immediately after the presentation and a brief Q&A session in the auditorium. Please register well in advance on (+47) 800 80 119 (from Norway) or (+47) 23 18 45 01 (from Norway or abroad).
Materials
English language versions of the full quarterly report and all presentations used during the press and analyst conference will be made available www.telenor.com/en/investor-relations/reports/q3-2010 at 07:00 and 08:45 hrs Norwegian time/CET, respectively.
1 âProfit after tax and non-controlling interests’ included actual figures for Kyivstar GSM JSC and estimated results for OJSC VimpelCom until 31 December 2009. As of the first quarter 2010, figures for OJSC VimpelCom and Kyivstar GSM JSC were included with a one quarter lag. The second quarter included a gain related to the contribution of Kyivstar to the new entity VimpelCom Ltd. of approxiately NOK 6.5 billion. Please refer to the section âAssociated companies’ on page 18 in the quarterly report for further details.
2 Operating cash flow is defined as EBITDA before other income and expenses – Capex, excluding licenses and spectrum.