TeliaSonera’s recently announced writedowns in Uzbekistan and Denmark weighed heavily on its Q4 earnings, as it reported Eurasia, a region which it plans to exit, as “discontinued operations”.
The Swedish operator said earlier this month it will take a total impairment charge of SEK7.2 billion ($844 million) relating to goodwill in Uzbekistan and Denmark.
As a result, the company slipped to a net loss of SEK3.01 billion, compared to net income of SEK2.9 billion the quarter year prior. On a positive note, total revenue rose 5.9 per cent to SEK22.7 billion, from SEK21.4 billion year on year, with the company talking up its performance in home market Sweden, as well as positive growth in Finland and Norway.
Johan Dennelind, CEO, said the company is “well on track to shape TeliaSonera for the future”.
“A solid foundation is now in place and I am pleased that our core markets continue to improvE in the fourth quarter at the same time as we started to execute our decision to reduce our presence in Eurasia,” he said in a statement. “Due to the divestment process, region Eurasia is now reported as discontinued operations and results have also been impacted by non-cash write downs.”
The “new TeliaSonera”
Dennelind added that the “process to leave the other Eurasian markets continues”, as the company seeks to exit a region where it has been embroiled in controversy in certain parts. In December, it made its first steps after announcing plans to sell its stake in Nepalese operator Ncell to Axiata.
In Sweden, a market where TeliaSonera is targeting significant growth as part of its new strategy, the company reported a small rise in revenue, to SEK9.9 billion from SEK9.6 billion last year, despite seeing mobile subscribers drop 1.9 per cent to 6.067 million from 6.186 million the previous year.
The company was however boosted by growth in fibre connections in the country, as well as high subscription uptake in its broadband and TV offering.
In total, it reported 13.9 million mobile subscribers in the rest of its European operations (Finland, Norway, Denmark, Estonia, Lithuania, Latvia and Spain), up 5.7 per cent from 13.2 million last year.
And in Norway, the company said it is “on track to reach its SEK1 billion target from synergies following the Tele2 acquisition in 2016”.
Dennelind added that 2016 will be a year of heavy investments for the company, with a focus on accelerated fibre roll out in Sweden. The company also confirmed plans to introduce a new dividend policy this year.