Telenor Q3: Subscriber growth and strong cash flow
Oct 28, 2021
Fornebu: «In the third quarter, Telenor reports flat organic subscription and traffic revenues, a 2% decline in organic EBITDA and a strong cash flow of NOK 7 billion. The results are impacted by the prevailing covid situation in Asia, nevertheless, we see strong trends, adding almost 2 million subscribers this quarter and almost 7 million year to date.
The solid performance in the Nordics continued. In Norway, demand for value added services drove a 3 % mobile ARPU growth in the quarter. The 5G rollout and copper decommissioning is running at full speed, supporting our superior network position and laying the foundation for future service growth. In Finland and Denmark, the strong performance resulted in 4 % growth in subscription and traffic revenues.
In Asia, there are early signs of gradual recovery from the impact of the pandemic. Subscriber growth and increasing data usage are important drivers in Bangladesh and Pakistan. In Thailand, the results are impacted by lockdowns. The country, however, is signaling re-opening of the borders for tourists towards the end of the year. In Malaysia, we see gradual improvement in performance through targeted market initiatives, supported by government stimuli packages and easing of restrictions as a result of high vaccination rates.
During the pandemic, we have accelerated the execution of our strategic ambitions, including modernisation and digitalization initiatives. As a result, our operations today are more efficient and resilient than they were at the beginning of the pandemic. Based on the performance so far this year, and on our expectations for the fourth quarter, we maintain our outlook for 2021.»
Sigve Brekke, President and CEO, Telenor Group
Third quarter 2021 summary 1)
- The Group’s mobile subscriber base grew by 1.8 million. The subscriber base was 172 million at the end of the quarter.
- Subscription and traffic revenues remained stable on an organic basis. Total reported revenues were NOK 27.4 billion, a decrease of NOK 1.0 billion.
- Currency adjusted opex decreased by NOK 0.1 billion, or 1%. Reported opex decreased by NOK 0.3 billion.
- Organic EBITDA decreased by 2%. Adjusted for non-recurring item in Sweden last year, organic EBITDA decreased by 1%. Reported EBITDA before other items was NOK 12.9 billion and the EBITDA margin was 47%.
- Capex excluding licences and spectrum was NOK 4.0 billion, yielding a capex to sales ratio of 15%.
- Reported net income was NOK 2.6 billion.
- Total free cash flow was NOK 7.2 billion. Leverage decreased to 1.9x at the end of the third quarter from 2.0x at the end of the previous quarter primarily driven by the solid free cash flow.
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