Quarterly Report January - September 1999

NETCOM AB ANNOUNCES SIGNIFICANT GROWTH IN OPERATING RESULTS FOR THE QUARTER ENDED SEPTEMBER 30, 1999, EXCEEDING MARKET EXPECTATIONS QUARTERLY REPORT JANUARY - SEPTEMBER 1999 * Profit after financial items increased by 144% to MSEK 706 Operating revenue increased by 35% to MSEK 5,825 EBITDA increased by 55% to MSEK 1,547 EBIT increased by 73% to MSEK 851 Earnings per share increased by 203% to SEK 3.88 New York and Stockholm - October 27, 1999 - NetCom AB ("NetCom", "the Group") (Nasdaq Stock Market: NECS), a leading provider of telecommunication services in the Nordic countries, the Baltic region and Poland, today announced its consolidated results for the quarter ended September 30, 1999. NetCom AB's operating results in the third quarter of 1999 increased significantly beyond market expectations and as a consequence the Company has decided to bring forward the timing of the release of its financial results for the nine months ended September 30, 1999 to today and not November 22, 1999 as previously indicated. You are invited to participate in a conference call to discuss these results which will take place today at 3.30 pm (Swedish time) and 9.30 am (New York time) by dialing the telephone number + 44 181 515 2310. A recording of the call will be available shortly after the call has ended on the number + 44 181 797 2499 (pin# 113333#). Financial Summary for the Nine Months ended September 30, (in MSEK) 1999 1998 % Change Operating Revenue 5,825 4,305 +35 Operating Profit before depreciation and 1,547 1,001 +55 amortization (i) after depreciation and 851 491 +73 amortization (ii) 706 289 +144 Profit after financial items Profit after taxes 403 133 +203 Earnings per share (SEK) 3.88 1.28 +203 (iii) (i) EBITDA (ii) EBIT (iii) Earnings per share figures are after tax and full conversion *NetCom ASA had not published third quarter results at the time of NetCom's quarterly release. To derive a figure for accounting purposes for its 25% proportional interest in NetCom ASA, for the nine months ended September 30, 1999, NetCom has accounted for the three months ended September 30, 1999 by assuming the same result as for three months ended June 30, 1999. NetCom will restate its figures when NetCom ASA publishes its third quarter results on November 15, 1999. EXECUTIVE SUMMARY Lars-Johan Jarnheimer, President and CEO stated, "In the third quarter, NetCom significantly improved the operating profitability of its operations and consequently, substantially exceeded market expectations. Improvements have been driven by Comviq's innovative new product launches and by Tele2 Denmark which in August contributed a positive EBITDA for the first time. In September, preselect was introduced in Sweden which has had a positive impact on fixed telephony volumes which have increased by 25% since introduction and this will continue to drive revenue growth in the fourth quarter. In Norway, where preselect was implemented in June we have experienced a substantial 103% uplift in call volumes in September. We remain committed to being the market leader in our respective markets and will achieve this through a consistent emphasis on competitive brand pricing and the application of best practices across our business to ensure that we are always the most cost efficient and the perceived price leading operator in our markets." ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/10/27/19991027BIT00310/bit0001.doc http://www.bit.se/bitonline/1999/10/27/19991027BIT00310/bit0002.pdf