Elisa’s Interim Report Q1 2023

ELISA CORPORATION INTERIM REPORT RELEASE 20 APRIL 2023 AT 8:30 AM

First quarter 2023 financial highlights

• Revenue increased by EUR 28m to EUR 540m due to growth in mobile, fixed and digital services as well as equipment sales.
• Mobile service revenue increased by 4.9 per cent to EUR 235m.
• EBITDA grew by EUR 6m to EUR 183m.
• EBIT increased by EUR 6m to EUR 117m.
• Comparable cash flow increased by EUR 5m to EUR 71m, mainly due to higher EBITDA and lower negative change in net working capital.
• In Finland, mobile post-paid ARPU increased to EUR 21.7 (21.5 in the previous quarter), and
• mobile post-paid churn decreased to 14.9 per cent (16.2).
• During the quarter, post-paid mobile subscriptions increased by 19,400. M2M and IoT subscriptions growth was 26,400.
• Prepaid subscriptions decreased by 12,000 during the quarter.
• The number of fixed broadband subscriptions increased by 2,600 during the quarter.

Key indicators

¹⁾ 2022 excluding EUR 2m in restructuring costs ²⁾ (Interest-bearing debt – financial assets) / (four previous quarters’ comparable EBITDA). ³⁾ 1Q22 excluding EUR 13m in share investments.

Additional key performance indicators are available at elisa.com/investors (Elisa Operational Data.xlsx).

CEO Veli-Matti Mattila: A good start to the year despite challenging circumstances

Elisa continued its solid development. In the first quarter, revenue increased by 6 per cent from the previous year to EUR 540 million. EBITDA improved by 4 per cent to EUR 183 million and earnings per share by 4 per cent to EUR 0.57. Despite increased energy costs, inflation and geopolitical challenges, all of our businesses have had solid performance.

Our solid 5G expansion continued in the first quarter. In Finland, our 5G population coverage reached 88 per cent and in Estonia over 70 per cent. Elisa has deployed the first distributed and fully automated 5G edge commercial solution in Europe. We continued to actively invest in our optical fibre network in the first quarter.

We continued to implement our mission: a sustainable future through digitalisation. Elisa’s wind power purchase agreement came into force at the beginning of April, covering approximately 40 per cent of the electricity needed for Elisa’s entire mobile network in Finland.

As part of our continuous cyber security development, the proportion of fraudulent phone calls has decreased by up to 84 percentage points (7/2021–2/2023) in Elisa's mobile network, compared to a decrease of only 15 percentage points at the overall country level in the number of Finns exposed to scam calls*. Elisa was one of the first in the world to introduce a technical solution for anti-scam measures combatting caller ID spoofing.

Elisa’s international digital services businesses continued to grow, with several global customer deals. In February, Elisa received a grant from the Finnish government to accelerate the rollout of Elisa’s latest innovation – the Distributed Energy Storage solution – across its network to create a virtual power plant with an expected capacity of 150 MWh, making it the largest such project in Europe.

Elisa has had science-based climate targets (SBTi) since 2018. Now Elisa is among the first in Finland to have new, even more ambitious Science Based Targets approved, including our Net Zero 2040 climate target.

We work determinately to promote equality, and we have been included in the 2023 Bloomberg Gender-Equality Index, which globally evaluates the performance of public companies committed to reporting gender-related data. In the latest Sustainable Brand Index 2023, Finnish consumers perceived Elisa as the most sustainable brand in the industry for the fourth year in a row.

Elisa's unique strategy generates sustainable profit and growth. Our competitiveness is based on continuously increasing our productivity and quality, our strong investment capability, and the growth opportunities from our innovative digital services globally. We continue to focus on creating value for our customers, engaging our employees and creating a positive impact on society to ensure solid financial performance for shareholders.

*Source: IROResearch Oy Tuhat suomalaista study, February 2023

Outlook and guidance for 2023

The development of the general economy includes many uncertainties. Growth in the Finnish economy is expected to stall. In particular, uncertainty relating to Russia's war in Ukraine, such as inflation and energy prices, is continuing. Challenges in global supply chains may also result in uncertainties in volumes and prices. Competition in the Finnish telecommunications market remains keen.

Full-year revenue is estimated to be at the same level or slightly higher than in 2022. Mobile data and digital services are expected to increase revenue. Full-year comparable EBITDA is anticipated to be at the same level or slightly higher than in 2022. However, the EBITDA growth potential is more challenging in the first half of the year. Capital expenditure is expected to be a maximum of 12 per cent of revenue.

Elisa is continuing its productivity improvement development, for example by increasing automation and data analytics in different processes, such as customer interaction, network operations and delivery. Additionally, Elisa’s continuous quality improvement measures will increase customer satisfaction and efficiency, and reduce costs.

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

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 50 520 5555

Distribution:

Nasdaq Helsinki
Principal media
elisa.com