First quarter 2009: Strong cash flow in a challenging environment

Turbulent business environment

"The business environment continues to be turbulent and we now experience some impact on the telecom sector, in particular influencing international traffic. However, the total traffic volumes are relatively stable. Among our markets, the Ukrainian economy is being the most affected by the financial crisis. In spite of negative revenue development, Kyivstar continues to deliver high margins and defend its strong revenue market share," Baksaas said.

Alfa conflict escalated

"During the first quarter of 2009 there was an escalation in the conflict with Alfa Group, with the arrest of our VimpelCom shares as a consequence. On 3 April 2009 Telenor was officially served with a claim to pay USD 1.7 billion in alleged damages. Telenor regards the claim to be unfounded, and expects to be fairly treated by higher courts," Baksaas said.

India - a milestone for the Telenor Group

"The closing of the Unitech Wireless deal in India on 20 March 2009 marks a milestone for the Telenor Group. An experienced management team is in place, and is currently preparing for launch of services during the second half of 2009," Baksaas said.

Scaling our business activities

"Going forward we expect the trends in the macro economic environment to continue and we are therefore highly focused on scaling our business activities accordingly. We are currently evaluating and implementing efficiency programmes across the value chain to achieve sustainable cash flow improvements. We maintain our outlook for 2009," Baksaas said.

Key figures

The table below contains pro forma key figures (including Kyivstar) for the first quarter of 2009, compared to the previous year:

 

	First quarter		Year
(NOK in millions except earnings per share)	2009	2008	2008
Revenues	27 119	26 292	110 997
EBITDA before other income and expenses	9 268	9 230	38 362
EBITDA margin before other income and expenses (%)	34.2	35.1	34.6
Adjusted operating profit	5 035	5 545	22 495
Adjusted operating profit/Revenues (%)	18.6	21.1	20.3
Profit after taxes and non-controlling interests	1 622	4 571	13 065
Earnings per share from total operations, basic, in NOK	0.98	2.72	7.83
Capex	3 291	5 089	22 715
Capex excl. licences and spectrum	3 291	5 089	20 680
Cash flow (EBITDA before other income and expenses - Capex)	5 977	4 141	15 647
Net interest-bearing liabilities end of period	35 783	31 340	39 309

For more information please refer to the quarterly report on

https://www.telenor.com/en/investor-relations/reports/q1-2009.

Read more about Telenor's I quarterly report.

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 Tuesday 5 May 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 Trond Westlie 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. See a recorded version of the conference. 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 https://www.telenor.com/en/investor-relations/reports/q1-2009.

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 00 04 00 (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 https://www.telenor.com/en/investor-relations/reports/q1-2009. at 07:00 and 09:00 hrs Norwegian time/CET, respectively.