Sep 15, 2011 4:17 PM CET

CMD2011 Summaries: Thomas Ekman

Smartphones Driving Revenues and Margin

Market Area Nordic showed strong cash flow generation in Q2 2011 with EBITDA at SEK 916 million and CAPEX at SEK 123 million.

Our focus areas in Sweden are building on mobile growth and 4G roll-out coupled with household/corporate fiber strategy. In Norway, we will focus integrating Network Norway.

Sweden:

We are seeing recovering EBITDA margins in Sweden, where smartphones are driving growth. We anticipate uplift in smartphone migration and higher fixed fees on data packages. Also, low end smartphones are entering the market, which of course is beneficial for Tele2 (negatively affecting the development of mid range handsets).

We see a strong handset data potential. For the mobile segment, our solid development of net sales is mostly driven by smartphone sales and data services.

For fixed, we will accelerate fiber build-out for the consumer market.

We will continue our 4G roll-out together with Net4Mobility, which will bring savings of almost SEK 300 million. By the end of 2012, we will have a 99% coverage. Right now we have new routers coming out on the market, and we are seeing 4G handsets and tablets arriving on the market during 2H 2011.

New cost efficiency measures will support breaking the mobile EBITDA trend.

Norway:

Tele2 controls now more than 99 percent of the shares in Network Norway. After the acquisition, we will support Norwegian market consolidation, become a clear number three operator and double our revenue market share in Norway.

We will have around 15% of the market, nationwide coverage by 1H 2013, and our long term market share goal is 25.