IN THE FIRST SIX MONTHS OF 2004 TELE2 INCREASED PROFIT AFTER TAX BY 38% WITH A RECORD CASH FLOW AFTER INVESTING ACTIVITI

IN THE FIRST SIX MONTHS OF 2004 TELE2 INCREASED PROFIT AFTER TAX BY 38% WITH A RECORD CASH FLOW AFTER INVESTING ACTIVITIES OF SEK 2.4 BILLION New York and Stockholm - Monday, August 2, 2004 - Tele2 AB ("Tele2", "the Group") (Nasdaq Stock Market: TLTOA and TLTOB and Stockholmsbörsen: TEL2A and TEL2B), the leading and profitable alternative pan-European telecom operator, today announced its consolidated results for the second quarter ended June 30, 2004. · Operating revenue for the first six months increased by 18% to MSEK 21,090 (MSEK 17,841) · Profit after tax for the first six months increased by 38% to MSEK 653 (MSEK 472) · Earnings per share after tax for the first six months increased to SEK 4.41 (SEK 3.19) · Net addition of over 1 million customers in the second quarter to a total of 24.9 (18.7) million · Cash flow after investing activities for the second quarter amounted to MSEK 1,167 (MSEK 965) The figures shown in parenthesis correspond to the comparable periods in 2003 and all negative amounts are distinguished with a minus sign. Lars-Johan Jarnheimer, President and CEO of Tele2 AB commented: "Tele2 continues to maintain its balance between customer growth, profitability and cash flow. In the first six months we had our best ever financial result while maintaining strong revenue growth of over 18%, probably unique in the industry. These results come on the back of a period of heavy investment in ADSL in France, the UK launch, Russian GSM expansion and other new service start-ups. These results fed through to generate a cash flow after investing activities of SEK 2.4 billion for the first six months. In the second quarter, we continued our expansion in Russia and Poland, where the market offers high revenue growth and low subscriber acquisition costs. That, in combination with increased investments in dial-up Internet, has nevertheless led to a certain ARPU dilution. Competition remains intense in both mobile and fixed telephony in Sweden. Despite this, we improved our EBITDA margins versus the first quarter within fixed telephony and maintained the level within mobile telephony. We launched our 3G services in Sweden this quarter, with the same tariffs as our GSM services and early indications are encouraging. We have continued to see the positive impact from the introduction of resale of the fixed line subscription fee in Norway, and anticipate the introduction of this service in Sweden towards the year-end. In the Baltic & Russia market area we had a strong customer intake and are now witnessing the benefits of our investments in Russian mobile. We maintained our momentum in Central Europe, with its operating revenue growing by 58% in the quarter, while continuing to improve its EBITDA. Also in Southern Europe the EBITDA margin rose versus the first quarter despite the heavy marketing investments in the UK and ADSL in France. We took on some 0.8 million ADSL and dial-up Internet customers in this market area over the past 12 months. Our focus, which has proven to be highly successful, continues to be on low customer acquisition cost, churn management and operational cost control." For full release please see attached pdf's. ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2004/08/02/20040802BIT20020/wkr0001.pdf