The Board of Telia Lietuva, AB (hereinafter "Telia Lietuva" or "the Company") approved unaudited Telia Lietuva, AB Interim Financial Statements, prepared according to International Financial Reporting Standards as adopted by the European Union, for the three months' period ended 31 March 2022.
First quarter of 2022 (compared with the same period a year ago):
- Revenue increased by 4.6 per cent and amounted to EUR 104.2 million (EUR 99.7 million).
- Adjusted EBITDA (excl. non-recurring items) went up by 4.8 per cent to EUR 35.6 million (EUR 34 million).
- EBITDA increased by 2.6 per cent and amounted to EUR 35.7 million (EUR 34.8 million).
- Profit for the period went down by 6.8 per cent to EUR 12.2 million (EUR 13.1 million).
- Free cash flow decreased by 21.6 per cent and amounted to EUR 17.6 million (EUR 22.4 million).
Management comment:
The year 2022 started with the hope that COVID-19 caused pandemic is retreating and we will return to business as usual. In the beginning of February we modestly celebrated the fifth anniversary of the merge of mobile and fixed communication business under one Telia brand, but the end of February brought unimaginable thing - war in Ukraine.
Reacting to the Russian Federation's military invasion into Ukraine, from 24 February till the end of March we provided free and unlimited calls and SMS to and from Ukraine. Starting from April calls and SMS from Lithuania to Ukraine are provided with 80 per cent discounts (i.e. at cost) and customers of Telia Lietuva within Ukraine during the whole April could call, text and browse the Internet free of charge. We also offered an unlimited number of prepaid mobile communication SIM cards with communication services to Ukrainian war refugees arriving to Lithuania. For Ukrainian businesses considering or preparing to relocate to Lithuania, the Company has prepared a special support package including broadband Internet, voice telephony and mobile connection as well as IT services. Following the sanctions imposed by European Union and the United States of America, and orders of the Radio and Television Commission of Lithuania, we suspended rebroadcasting of Russian TV channels. Moreover, we made 12 international TV news and information channels available to all Telia TV service users free of charge.
As provider of telecommunication and IT services, we have a limited exposure to telecommunication operators and some customers, users of webhosting and cloud services provided by the Company, from the Russian Federation and the Republic of Belarus. The Company is reconsidering continuation of those relationship due to imposed sanctions and possible settlements disruption in order to mitigate accumulation of overdue or bad debts. The Management of the Company has considered the possible impact of sanctions imposed by EU and the U.S.A. to certain legal and natural entities of the Russian Federation and the Republic of Belarus, and has determined that they do not create a material uncertainty that casts significant doubt regarding the Company's ability to continue as a going concern. The possible negative impact of currently imposed sanctions in case they will be valid through the whole year 2022 are estimated to be below 1 per cent of the Company's annual revenue and below 2 per cent of the Company's annual EBITDA.
During the first three months of 2022 we continue preparations for 5G communication era: more than 200 base stations were upgraded with Ericsson equipment supporting 2G, 3G, 4G and 5G connectivity in addition to more than 450 already modernised base stations. In January, we were the first in Lithuania to activate the currently for 4G connection used 2,100 MHz frequencies for 5G network in 20 base stations in Vilnius. The next-generation technology runs in Dynamic Spectrum Sharing mode, which allows the same frequency band to be used in parallel for both 4G and 5G connection. More than EUR 4.2 million out of total EUR 13.3 million investments were allocated to modernisation of the Company's mobile network during the first quarter of 2022. Quarterly investments were by almost the tenth higher than a year ago.
During January- March of 2022, the number of mobile service users increased by 14 thousand, number of broadband Internet users went up by 1 thousand, while number of TV service users eased by 1 thousand mainly due to switch off of Russian TV channels. Over the last twelve months:
- number of mobile service subscriptions grew by 10.6 per cent up to 1,532 thousand,
- number of fiber-optic Internet connections went up by 2.3 per cent up to 306 thousand,
- number of TV service users increased by 0.4 per cent up to 254 thousand.
Double digit growth of revenue from mobile communication and IT services continues, while revenue from TV services slightly went down due to customers' churn. In spite of 80 per cent higher than a year ago expenses for electricity and continuously increasing employee related expenses, we managed to ensure an EBITDA growth. Higher than in 2021 depreciation and amortisation charges as well as higher income tax had a negative impact on the profit for the period.
Telia Lietuva was named the most environmentally friendly among the large companies by the National Responsible Business Awards. We were recognised for our sustainable business decisions and responsible supply chain design.
For the approval of the General Meeting of Shareholders, the Board proposed to allocate EUR 58.3 million or EUR 0.10 dividends per share for the year 2021, and to pay EUR 33 thousand as tantiems to two independent Board members.
ENCL.:
- Telia Lietuva, AB Interim Financial Statements for the three months' period ended 31 March 2022.
- Presentation of Telia Lietuva, AB results for the 3 months of 2022
Darius Džiaugys,
Head of Investor Relations,
tel. +370 5 236 7878,
e-mail: darius.dziaugys@telia.lt
Attachments
- Telia_Lietuva_2022_3_months_financial_statements
- Telia_Lietuva_2022_3_months_results_presentation
