Financial overview
Tele2’s financial performance results from our continued focus on developing mobile services on our own infrastructure, complemented in some countries by fixed broadband services and business-to-business offerings. Mobile sales, which grew compared with the same period last year, and a greater focus on mobile services on our own infrastructure have further improved our EBITDA margin. The decline in the fixed telephony customer base is expected to persist. The company will concentrate on maximizing the return from fixed-line operations.
Net customer intake amounted to 1,096,000 (347,000) in Q2 2010. The customer intake in mobile services more than doubled to 1,208,000 (524,000), of which 39,000 (42,000) were mobile internet users. This result was mainly driven by a solid performance in Tele2 Russia, Tele2 Sweden and Tele2 Croatia, but also positively influenced by a recovery in Tele2’s Baltic operations. During the period, Tele2 Russia’s customer base grew by 1,113,000 (478,000) customers, of which 686,000 (128,000) were derived from new regions. Fixed broadband customer intake amounted to -2,000 (-7,000) customers in Q2 2010, due to a customer outflow in Sweden and Germany. However, Tele2 Austria broke a negative trend by adding 4,000 (-4,000) broadband users in the quarter. As expected, the number of fixed telephony customers fell in Q2 2010. However the churn rate in the fixed telephony customer base continued to decrease in the quarter, partly driven by Tele2 Germany. By June 30 2010 the total customer base increased to 28,751,000 (24,937,000) thanks to a prolonged success in mobile services.
Net sales in Q2 2010 amounted to SEK 9,967 (9,912) million, excluding one-off items of SEK 588 (-59) million . Including one-off items, net sales amounted to SEK 10,555 (9,853) million. The revenue development was mainly a result of sustained success in mobile services, offset to some extent by negative sales development in fixed telephony and the divestment of Tele2 Norway’s fixed broadband operations in Q2 2009.
EBITDA in Q2 2010 amounted to SEK 2,687 (2,446) million, equivalent to an EBITDA margin of 27 (25) percent. The EBITDA development was positively affected by better-than-expected operational progress in Tele2’s Russian and Croatian mobile operations, coupled with improved fixed broadband services.
EBIT in Q2 2010 amounted to SEK 1,767 (1,504) million excluding one-off items of SEK 527 (-59) million . Including one-off items, EBIT amounted to SEK 2,294 (1,445) million.
Profit/loss before tax amounted to SEK 2,070 (1,462) million.
Net profit/loss amounted to SEK 1,649 (1,128) million in the quarter. Reported tax for Q2 2010 amounted to SEK -421 (-334) million affected by one-off items amounting to SEK 73 (0) million . Tax payment affecting cash flow amounted to SEK -195 (-124) million.
Cash flow after Capex amounted to SEK 2,013 (921) million.
CAPEX amounted to SEK 793 (1,085) million,
Net debt amounted to SEK 4,229 (5,441) million on June 30, 2010, or 0.45 times full-year 2009 EBITDA. Including guarantees to joint ventures, the net debt to full-year 2009 EBITDA amounted to 0.62 times. Tele2’s available liquidity amounted to SEK 12,472 (9,114) million.