Elisa Oyj : Elisa - Elisa’s Interim Report January–September 2013

ELISA INTERIM REPORT RELEASE 17 0CTOBER 2013 AT 8:30am

Third quarter 2013

- Revenue amounted to EUR 395 million (387)
- EBITDA was EUR 138 million (134), and excluding non-recurring items EUR 142 million
- EBIT was EUR 84 million (85), and excluding non-recurring items EUR 87 million
- Profit before taxes amounted to EUR 78 million (78)
- Earnings per share was EUR 0.38 (0.38)
- Cash flow after investments increased to EUR 51 million (37)

- Mobile ARPU was EUR 16.1 (16.2 in previous quarter)
- Mobile churn was 18.0 per cent (17.7 in previous quarter)
- The number of Elisa's mobile subscriptions increased by 7,500 during the quarter
- The number of fixed broadband subscriptions decreased by 1,300 on the previous quarter
- Net debt / EBITDA was 2.0 (1.7 end 2012) and gearing 121 per cent (99 end 2012)

January-September 2013

- Revenue was EUR 1,146 million (1,158)
- EBITDA was EUR 369 million (377) and excluding non-recurring items EUR 374 million
- EBIT was EUR 212 million (225) and excluding non-recurring items EUR 217 million
- Cash flow after investments was EUR 58 million (121), excluding acquisitions EUR 146 million

Key indicators

1)Excluding non-recurring items: Q3: EBIT EUR 87m, profit before tax EUR 81m and EPS EUR 0.40. 1-9/2013 EBIT: EUR 217m, profit before tax EUR 200m and EPS EUR 0.96.

Financial position and cash flow

1)(interest-bearing debt - financial assets) / (four previous quarters' EBITDA exclusive of non-recurring items)

2)1-9/2013 cash flow after investments excluding investments in PPO and Sulake shares EUR 146m

CEO Veli-Matti Mattila:

"Elisa's revenue and earnings grew year on year

In the third quarter of the year, Elisa's earnings and revenue grew year on year, even though the operating environment continued to be challenging. The uncertainty in the general economic situation could still be seen in the cautiousness of companies and consumers, but the most aggressive price campaigns seen at the beginning of the year did not continue as intensively. Demand for new services and growth in the smartphone market continued to be strong. 

The mobile subscription base grew by 7,500 during the third quarter. The number of fixed broadband subscriptions fell by approximately 1,300 subscriptions as companies reduced the number of their subscriptions. The use of mobile data services increased, while the demand for smartphones, dongles and routers grew among both consumers and corporate customers.

New services were developed for corporate customers. Elisa's subsidiary Appelsiini introduced to the market the information dissemination service Povari. Povari is a new way of storing and sharing information in a secure and effortless manner. In Povari, the information is securely stored in Finland, in Elisa's domestic data centres. Elisa began cooperation with the Jyväskylä University of Applied Sciences, the aim of which is to improve operational readiness and the prevention and anticipation of cyber threats to companies. 

In the first quarter of the year, we began new measures to improve profitability in the current challenging environment. Our measures in streamlining product portfolio and IT systems and operations, enhancing the efficiency of customer service and sales, and cutting administrative costs, continued with increased effectiveness. 

We will continue the determined implementation of actions promoting customer satisfaction and the productivity of our operations. Improving our productivity, developing new services for our customers, and maintaining our strong investment ability all create a solid foundation for competitive operations in the future."

Outlook for 2013 

The macroeconomic environment in Finland is still expected to be weak in 2013. Competition in the Finnish telecommunications market also remains challenging.

Full year revenue is estimated to be at the same level or slightly higher than in the previous year. Mobile data, ICT and new online services as well as completed acquisitions are expected to increase revenue. Full-year EBITDA, excluding non-recurring items, is anticipated to be at the same level as in 2012. As a result of the PPO consolidation, full-year capital expenditure is expected to be approximately 13 per cent of revenue. The mid-term target of a maximum of 12 per cent is still valid. Elisa's financial position and liquidity are good.

In order to secure good results in a challenging environment, Elisa is continuing its accelerated cost efficiency measures, in the areas of streamlining product portfolio and IT systems and operations, increasing  customer service and sales efficiency, as well as reducing  general administration costs.

Elisa's transformation into a provider of new, exciting and relevant services for its customers is continuing. Long-term growth and profitability improvement will derive from mobile data market growth, as well as new online and ICT services.

Disclosure procedure

Elisa is adopting the disclosure procedure enabled by the Standard 5.2b published by the Finnish Financial Supervision Authority. This is a summary of Elisa's Q3 2013 interim report and the complete report is attached as a pdf-file to this release and is also available on our website at www.elisa.com/investors.

ELISA CORPORATION

Additional information:

Mr. Veli-Matti Mattila, CEO, tel. +358 10 262 2635
Mr. Jari Kinnunen, CFO, tel. +358 10 262 9510
Mr. Vesa Sahivirta, IR Director, tel. +358 10 262 3036

Distribution:
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