Elisa’s Interim Report Q3 2020

ELISA CORPORATION INTERIM REPORT RELEASE 16 OCTOBER 2020 AT 8:30 AM

Third quarter 2020 financial highlights

  • Revenue increased by EUR 3m to EUR 468m.
  • Mobile service revenue decreased by 0.5 per cent to EUR 206m mainly due to a substantial decrease in roaming revenue caused by COVID-19 travel restrictions. From the previous quarter, MSR grew by EUR 2m, or 1 per cent. 
  • EBITDA grew by EUR 1m to EUR 180m.
  • EBIT decreased by EUR 1m to EUR 112m.
  • Comparable cash flow decreased by EUR 2m to EUR 97m.
  • Mobile post-paid ARPU was at the previous quarter’s level of EUR 19.0 (19.1).
  • Mobile post-paid churn increased to 17.6 per cent (16.4 in previous quarter).
  • The number of post-paid mobile subscriptions increased by 24,800 from the previous quarter.
  • Due to seasonality, prepaid subscriptions increased by 15,100 during the quarter.
  • The number of fixed broadband subscriptions increased by 6,700 during the quarter.
  • Guidance for 2020 is unchanged.

Key indicators

EUR million 3Q20 3Q19 Δ % 1Q-3Q20 1Q-3Q19 Δ %
Revenue 468 465 0.6 % 1,396 1,356 3.0 %
EBITDA 180 179 0.8 % 514 493 4.3 %
Comparable EBITDA 180 179 0.8 % 514 500 2.9 %
EBIT 112 113 -0.6 % 312 295 5.7 %
Comparable EBIT 112 113 -0.6 % 312 302 3.3 %
Profit before tax 108 107 1.6 % 300 276 8.5 %
Comparable PBT 108 107 1.6 % 300 283 5.9 %
EPS, EUR 0.55 0.53 5.2 % 1.54 1.40 9.6 %
Comparable EPS, EUR 0.55 0.53 5.2 % 1.54 1.44 6.8 %
Capital expenditure 75 56 34.8 % 201 173 15.9 %
Net debt 1,256 1,235 1.7 % 1,256 1,235 1.7 %
Net debt / EBITDA 1) 1.8 1.9 1.8 1.9
Gearing ratio, % 114.8 % 115.3 % 114.8 % 115.3 %
Equity ratio, % 36.2 % 37.6 % 36.2 % 37.6 %
Cash flow  91 97 -6.1 % 247 202 22.2 %
Comparable Cash flow 2) 97 98 -1.7 % 255 268 -4.8 %

1) (Interest-bearing debt – financial assets) / (four previous quarters’ comparable EBITDA). 2) Excluding investments in shares.

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

CEO Veli-Matti Mattila: Solid performance in COVID-19 circumstances continued

In the third quarter, Elisa continued its solid development. Revenue increased by 1 per cent to EUR 468 million from the previous year. Comparable EBITDA improved by 1 percent, to EUR 180 million, and earnings per share by 5 per cent, to EUR 0.55.

Elisa’s 5G network has expanded rapidly and now covers more than 50 Finnish towns and cities and over 1.6 million people. We continued innovating 5G pilot programmes, improving operations in schools, hospitals, and environmental and rescue services.

Demand for fast connections and remote services, especially customer service solutions (e.g. in the public sector and healthcare services), continued. Data usage in our mobile networks continued grow strongly from previous year, and capacity has met the increased demand well.

The COVID-19 pandemic continued to frame the third quarter. We focused on our innovative ways of working to ensure smooth operations and the safety of our customers and personnel. We participated in the development and deployment of the Finnish COVID-19 alert application, Koronavilkku, providing data from our network to the Finnish Transport and Communications Agency (Traficom) for development purposes, and once the application was launched, we offered guidance and assistance for customers in our nationwide customer service channels.

Our mission is a sustainable future through digitalisation. We are committed to the principles of the UN Global Compact and were one of the major companies to sign the UN Statement on Renewed Global Cooperation published in September. We have also continued to reduce our CO2 emissions according to our goal to become the first carbon-neutral telco in the Nordics already in 2020.

The continuous improvement of the customer experience and quality are integral parts of our corporate culture, and we will continue to focus on them strongly. Increasing productivity, expanding our digital services internationally and creating value with data, as well as our strong investment capability, continue to lay a solid foundation for creating value competitively in the future.

Outlook and guidance for 2020

The current coronavirus (COVID-19) situation will slow down economic growth and is creating uncertainty in macroeconomic development. A strong economic slowdown may impact Elisa. Competition in the Finnish telecommunications market remains keen.

Guidance for 2020 is unchanged. Full-year revenue is estimated to be at the same level or slightly higher than in 2019. 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 2019. 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 interactions, 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 growth and profitability improvement will derive from growth in the mobile data market, as well as digital 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 Interim Report Q3 2020 and the complete report is attached as a pdf-file to this release and is also available on our website at 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 50 520 5555

Distribution:

Nasdaq Helsinki
Principal media
elisa.com

About Us

Elisa is a pioneer in telecommunications and digital services. We serve approximately 2.8 million consumer, corporate and public administration organisation customers, and have over 6.3 million subscriptions in our extensive network. Cooperation with Vodafone and Tele2, among others, enables globally competitive services. Our core markets are Finland and Estonia, and we also provide digital services for international markets. Elisa’s shares are listed on the Nasdaq Helsinki. In 2019, our revenue was EUR 1.84 billion euros, and we employed 4,900 people. As a responsible Finnish market leader, our operations are guided by continuous improvement. We will be a carbon neutral company from 2020 onwards. Further information on www.elisa.com , Facebook (@elisasuomi) and Twitter (@ElisaOyj)

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