Elisa’s Interim Report Q3 2024
ELISA CORPORATION INTERIM REPORT RELEASE 18 OCTOBER 2024 AT 8:30 AM
Third quarter 2024 financial highlights
- Revenue decreased by EUR 9m to EUR 536m, mainly due to lower equipment sales and regulated revenue as well as the net impact of acquisitions and disposals.
- Mobile service revenue increased by 4.8 per cent to EUR 254m.
- EBITDA grew by EUR 7m to EUR 206m.
- EBIT increased by EUR 5m to EUR 136m.
- Comparable cash flow increased by EUR 4m to EUR 111m.
- In Finland, mobile post-paid ARPU increased to EUR 23.2 (23.1 in the previous quarter), and
- mobile post-paid churn increased to 16.8 per cent (15.0).
- During the quarter, the number of post-paid mobile subscriptions increased by 27,700. The M2M and IoT subscription base grew by 39,800.
- Prepaid subscriptions increased by 14,000 during the quarter.
- The number of fixed broadband subscriptions increased by 8,200 during the quarter.
- EBITDA guidance for 2024 is upgraded to “slightly higher” (previously “same level or slightly higher”).
Key indicators
| EUR million | 3Q24 | 3Q23 | Δ % | 1Q-3Q24 | 1Q-3Q23 | Δ % | |
| Revenue | 536 | 545 | -1,6 % | 1 612 | 1 617 | -0,3 % | |
| EBITDA | 206 | 199 | 3,7 % | 576 | 565 | 1,9 % | |
| Comparable EBITDA (1 | 206 | 199 | 3,7 % | 586 | 565 | 3,7 % | |
| EBIT | 136 | 131 | 3,6 % | 369 | 364 | 1,4 % | |
| Comparable EBIT (1 | 136 | 131 | 3,6 % | 379 | 364 | 4,2 % | |
| Profit before tax | 126 | 125 | 0,4 % | 343 | 348 | -1,2 % | |
| Comparable profit before tax (1 | 126 | 125 | 0,4 % | 353 | 348 | 1,7 % | |
| EPS, EUR | 0,63 | 0,63 | 0,3 % | 1,72 | 1,76 | -2,2 % | |
| Comparable EPS, EUR (1 | 0,63 | 0,63 | 0,3 % | 1,77 | 1,76 | 0,7 % | |
| Capital expenditure | 93 | 78 | 19,7 % | 245 | 213 | 15,4 % | |
| Net debt | 1 298 | 1 356 | -4,3 % | 1 298 | 1 356 | -4,3 % | |
| Net debt / EBITDA (2 | 1,7 | 1,8 | 1,7 | 1,8 | |||
| Gearing ratio, % | 107,5 % | 114,3 % | 107,5 % | 114,3 % | |||
| Equity ratio, % | 38,1 % | 36,1 % | 38,1 % | 36,1 % | |||
| Cash flow (3 | 95 | 107 | -10,7 % | 233 | 286 | -18,5 % | |
| Comparable cash flow (4 | 111 | 107 | 4,1 % | 291 | 286 | 1,9 % | |
1) 1Q-3Q2024 excluding EUR 10m in restructuring costs. 2) (Interest-bearing debt – financial assets) / (four previous quarters’ comparable EBITDA). 3) Cash flow before financing activities. 4) 3Q24 excluding EUR 16m and 1Q–3Q24 excluding EUR 58m in share and business investments and loans granted.
Additional key performance indicators are available at elisa.com/investors (Elisa Operational Data.xlsx).
CEO Topi Manner: Solid earnings development continuing
In the third quarter, Elisa continued its good performance, despite geopolitical uncertainties and the continued soft macroeconomic environment, which prompted companies to engage in cost savings and personnel reductions. Lower interest rates and inflation have so far had no impact on demand. Revenue decreased by 2 per cent to EUR 536 million, mainly due to the net impact of acquisitions and disposals, a decrease in equipment sales, and regulated revenue. EBITDA, however, improved by 4 per cent to EUR 206 million, driven by mobile service revenue, efficiency improvements and improving profitability in the B2B segment. Earnings per share was EUR 0.63.
Elisa’s 5G network has now reached all municipalities in Finland, covering over 95 per cent of the population. We have seen accelerated growth in the 5G standalone (5G+) base. Customers appreciate the improved network quality and service levels, as well as decreases in energy consumption by their devices. The acquisition of fibre networks in the eastern and northeastern parts of Finland from Kaisanet, announced in July, further strengthens our fibre coverage.
In September, we launched the Elisa Etuohjelma loyalty programme for our consumer customers in Finland, rewarding customers for their long-term relationships and for centralising their subscriptions and services with Elisa. This loyalty programme is the first of its kind among operators in Finland and has been well received by our customers.
Our international digital services business continues to grow. In October, we announced an agreement acquiring the rest of the share capital of sedApta Group. The acquisition accelerates the growth of the Elisa IndustrIQ business, strengthening our software offering in industrial automation and Elisa’s foothold in the global manufacturing customer base. Italy-based sedApta is an industrial software provider specialising in innovative IT solutions for manufacturing operations and supply chain management, with over 1,500 manufacturing industry customers globally.
Elisa plays a key role in securing Finland's cyber security and critical infrastructure. In July, Elisa participated in Cyber Fortress 3.0, a cyber exercise related to defence cooperation between Finland and the United States. Cooperation between business and the authorities plays a key role in protecting critical infrastructure.
Our performance during the quarter clearly demonstrates our strong commitment to profitable growth, creating customer value by being a frontrunner in technology, and continuously improving our productivity and quality.
Outlook and guidance for 2024
The development in the general economy includes many uncertainties. Growth in the Finnish economy is expected to stall. In particular, there is continuing uncertainty relating to Russia’s war in Ukraine and other conflicts. 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 as or slightly higher than in 2023. Mobile data and digital services are expected to increase revenue. Full-year comparable EBITDA is anticipated to be slightly higher than in 2023. Capital expenditure is expected to be 12–13 per cent of revenue.
Elisa continues to improve productivity, 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 Topi Manner, CEO, tel. +358 10 265 1200
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