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TeliaSonera reports impressive profit despite dabbed with bribery and corruption scandals

Wednesday, 17 July 2013
The scandal surrounding TeliaSonera's business in Uzbekistan has led to major changes in its management but the stigma of corruption and bribery does not seem to had scared off subscribers. The company posted profit before tax of Skr5.519 million for the second quarter

Sales were relatively stable during the quarter, while Telia cut their costs to guard against any after effects of their trobles. This has meant that profitability has improved.

"I think we have coped quite well given the media pressure we've had on the company," says Per-Arne Blomquist, who is interim CEO until September when the new CEO Johan Dennelind takes office.

The company reported a profit before tax of Skr5.519 million for the second quarter of 2013. That compares with profit of Skr6.046 million corresponding period in 2012.

Analysts had on average expected a profit before tax of Skr5 249 million, according to Reuters. Sales amounted to Skr25.274 million, compared to Skr26.294 million a year earlier.

Summary of TeliaSonera's perfromance for the second quarter

Second quarter summary

First half summary

Net sales in local currencies, excluding acquisitions and disposals, increased 0.4 percent. In reported currency, net sales decreased 3.9 percent to SEK 25,274 million (26,294).
The addressable cost base in local currencies, excluding acquisitions and disposals, decreased 4.1 percent. In reported currency, the addressable cost base decreased 6.6 percent to SEK 7,165 million (7,672).
EBITDA, excluding non-recurring items, increased 3.3 percent in local currencies, excluding acquisitions and disposals. In reported currency, EBITDA, excluding non-recurring items, decreased 1.2 percent to SEK 8,928 million (9,034). The EBITDA margin, excluding non-recurring items, increased to 35.3 percent (34.4).
Operating income, excluding non-recurring items, decreased 2.8 percent to SEK 7,085 million (7,286). Operating income decreased 10.8 percent to 6,283 million (7,044), including non-recurring items of SEK -802 million (-242).
Net income attributable to owners of the parent company decreased 16.9 percent to SEK 4,031 million (4,852).
Earnings per share decreased to SEK 0.93 (1.12).
Free cash flow was SEK 4,462 million (3,062, excluding dividends from MegaFon net of taxes of SEK 11,726 million).
Group outlook for 2013 is unchanged.

Net sales in local currencies, excluding acquisitions and disposals, decreased 0.3 percent. In reported currency, net sales decreased 4.2 percent to SEK 49,816 million (51,987).
Net income attributable to owners of the parent company decreased 9.3 percent to SEK 8,139 million (8,974) and earnings per share to SEK 1.88 (2.07).
Free cash flow was SEK 6,876 million (5,255, excluding dividends from MegaFon net of taxes of SEK 11,726 million).

Source: TeliaSonera