TeliaSonera sees profit drop after "eventful" year

TeliaSonera sees profit drop after “eventful” year

30 JAN 2014

Nordic operator group TeliaSonera reported a fall in profit for the fourth quarter of 2013, rounding off what Johan Dennelind, president and CEO, described as an “eventful and challenging” year.

Net sales for the fourth quarter were SEK26.50 billion ($4.08 billion), down 2.1 per cent, while net income attributable to owners of the parent company fell 68.2 per cent to SEK2.19 billion.

Earlier this month the operator said its fourth quarter was impacted by “one-time related items” totalling SEK2.52 billion. A large chunk of this was for non-cash goodwill impairment charges on operations in Denmark and Lithuania, plus redundancy costs and book value adjustments following restructuring.

Dennelind, who assumed the role in September last year, said 2013 saw TeliaSonera’s overall performance impacted by “modest economic growth, regulatory effects and rapidly changing customer behaviour”.

In Mobility Services, the company saw margins remain stable, as it continued to develop its data-centric pricing models and invested in coverage and capacity. Net sales of SEK12.78 billion were down 2.3 per cent, having been impacted by lower regulated termination rates, while operating income of SEK1.35 billion compared with a prior year loss of SEK434 million.

The group’s Eurasian operations delivered “strong profitability” during the fourth quarter. Net sales for these businesses in Q4 totalled SEK5.24 billion, up 0.3 per cent, with operating income of SEK3.22 billion, down 64 per cent.

For the full year, net sales fell 3 per cent to SEK101.7 billion, with net income falling 24.7 per cent to SEK14.97 billion. Total full-year costs related to redundancies amounted to slightly more than SEK1.2 billion.

The company’s board of directors proposed an ordinary dividend for 2013 of SEK3.0 per share, 5.3 per cent higher than previously stated. Shareholders will receive a total of SEK13.0 billion.

TeliaSonera announced last December a new operating model effective on 1 April 2014. As a result of the new country structure, the operator said there will be further consolidation of IT systems and platforms.

Dennelind’s predecessor, Lars Nyberg, resigned in February last year after an external review of the Nordic operator group’s investments in Uzbekistan criticised how it obtained a mobile licence in 2007.

Dennelind said the company continues to roll out a code of ethics and conduct training. “Creating a sustainable business is a key part of our strategic initiatives and significant measures have been taken in order to strengthen corporate governance,” he noted.


Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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