TeliaSonera Finland


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TeliaSonera Finland

  1. 1. Anni Vepsäläinen President TeliaSonera Finland
  2. 2. TeliaSonera Finland <ul><li>Telecommunications leader in Finland </li></ul><ul><li>High margins, strong cash flow </li></ul><ul><li>Passion for customers and profits </li></ul><ul><li>Capitalize on cross selling opportunities </li></ul><ul><li>Increase fixed to mobile voice migration </li></ul><ul><li>Grow broadband services </li></ul><ul><li>Leading the mobile services market </li></ul>Profitable growth with customer orientation
  3. 3. Key financials Product area / External net sales Q1 2003 <ul><li>Mobile communications 63% </li></ul><ul><li>Fixed communications 37% </li></ul>1) Excluding non-recurring items 391 2,151 CAPEX 6,200 6,235 Number of employees (end of period) 41.7% 39.2% Margin 1,823 6,869 EBITDA 1) 2, 056 17,295 Full year 2002 4,264 External net sales 690 Operating income 1) Q1 2003 SEK million
  4. 4. <ul><li>Mobile communications </li></ul><ul><li>Increasing voice usage </li></ul><ul><li>Subscription growth </li></ul><ul><li>Fixed line </li></ul><ul><li>Decreasing number of subscriptions </li></ul><ul><li>Internet & Data </li></ul><ul><li>Strong growth in broadband </li></ul><ul><li>Dial-up connections migrating to broadband </li></ul><ul><li>Other </li></ul><ul><li>Terminal sales </li></ul>Revenue development Q1 2003 Revenue change Q1 2003 compared to Q1 2002 (SEK million) Total external sales SEK million +2.8% 4,146 4,264 Change Q1 2002 Q1 2003 0 Mobile Fixed subscr. & VAS Internet & Data Other Fixed traffic charges Total +33 -11 +18 +87 -8 118
  5. 5. Telecom market environment 2002 Telecom business by ‘functions’ 2002 Market share in value 2002 <ul><li>Characteristics </li></ul><ul><li>179 companies with license to operate </li></ul><ul><li>Total turnover EUR 4.6 billion </li></ul><ul><li>Amount of personnel 19,800 </li></ul><ul><li>Competition </li></ul><ul><li>Three largest players: Sonera-group, Elisa-group, Finnet-group </li></ul><ul><li>Sonera market leader </li></ul><ul><li>Trends </li></ul><ul><li>Communication continues to grow </li></ul><ul><li>Service usage via Internet – need for broadband connections </li></ul><ul><li>Mobile terminal and service development – mobile data usage grows rapidly </li></ul><ul><li>Offerings from products to selling services </li></ul>Sonera 48% Elisa 34% Others 1% Finnet 17% Internet 5% Long-dist 1% Local calls 17% Mobile 43% Other 34%
  6. 6. Market share development Market share 1 % <ul><li>Market leader in mobile, Internet and broadband subscriptions and corporate datacom services </li></ul><ul><li>Market share loss in mobile due to tough competition </li></ul><ul><ul><li>Loss of price and offer sensitive customers </li></ul></ul><ul><li>Several actions to turn the negative trend </li></ul>1) Value, estimates. (historical data n/a)
  7. 7. Segment based activities to improve business performance Segment Consumer Segment Business <ul><li>Broadening customer relationships </li></ul><ul><li>Packaged services (mobile broadband, VoIP) </li></ul><ul><li>Market leader in 3G services </li></ul><ul><li>Efforts to reverse the market share development </li></ul><ul><li>Remarkable improvement in customer service levels </li></ul><ul><li>One customer relationship </li></ul><ul><li>Tailored messages to sub-segments (by age & behaviour groups) </li></ul><ul><li>Remarkable improvement in customer service levels </li></ul><ul><li>One customer relationship, “one stop shopping” </li></ul><ul><li>Tailored messages to sub-segments (by industries) </li></ul><ul><li>Combined services </li></ul><ul><li>Implementing B2B strategy: Managed services </li></ul><ul><li>Improving and modernizing the sales culture </li></ul><ul><li>More customer benefits, quality and value for money, competitive price level </li></ul><ul><li>Establish a task force to win customers from competitors, when launching MNP </li></ul><ul><li>Sales activities and customer service </li></ul><ul><li>Solutions for business customers’ business processes </li></ul><ul><li>Establish a task force to win customers from competitors, when launching MNP </li></ul>Segment Large Corporate <ul><li>One customer relationship </li></ul><ul><li>Understanding customers’ business processes </li></ul><ul><li>Sales activities and customer service </li></ul><ul><li>Solutions for corporate customers’ business processes </li></ul><ul><li>Combined services </li></ul><ul><li>Implementing B2B strategy: Managed services </li></ul><ul><li>Improving and modernizing the sales culture </li></ul>Churn management Customer orientation Growth
  8. 8. Continued efficiency measures <ul><li>Implement the competence centre structure </li></ul><ul><ul><li>Group wide and national level </li></ul></ul><ul><li>Fine tune steering model </li></ul><ul><li>Develop leadership and managerial practises </li></ul><ul><li>Implement personnel restructuring plan </li></ul><ul><li>Focus product portfolios </li></ul><ul><li>Decrease number of technical platforms </li></ul><ul><li>Manage All-IP evolution </li></ul><ul><li>Utilize our own services </li></ul>Developing personnel and leadership Improving efficiency Delivering synergies
  9. 9. Increased mobile usage ARPU MoU EUR minutes Churn 15.8% in Q1 2003
  10. 10. Non-voice growth Non-voice as % of revenues <ul><li>Colour screen, polyphonic ring tones, cameras and other advanced terminal features becoming more common </li></ul><ul><li>New mobile services launched, e.g. popular ice-hockey service </li></ul><ul><li>Promising development in GPRS subscriptions due to terminal development and new services </li></ul><ul><li>SMS usage saturated </li></ul><ul><li>Non-voice % stable due to SMS price erosion </li></ul>GPRS subscriptions (thousands)
  11. 11. Sonera Colour: a new range of services for MMS phones <ul><li>In April 2003 most diversified range of multimedia services on the Finnish market were launched: </li></ul><ul><li>MM-Ice Hockey services </li></ul><ul><li>Internet Chat </li></ul><ul><li>Sonera Plaza auction </li></ul><ul><li>WAP-news </li></ul><ul><li>Traffic information </li></ul><ul><li>etc. </li></ul>
  12. 12. Fast broadband expansion Number of consumer broadband / Dial-up customers (thousands) <ul><li>Increasing customer need for services via Internet </li></ul><ul><li>Strong growth in broadband market </li></ul><ul><li>Number of dial-up subscriptions decreasing </li></ul><ul><li>Market leader in broadband and dial-up Internet connections </li></ul><ul><li>Own network in rural areas, challenger in big cities </li></ul>
  13. 13. Continued strong mobile margin <ul><li>Strong margins despite tough competition </li></ul><ul><li>Seasonal fluctuations due to the campaigns </li></ul>Operating income 1 (SEK million) 1) Excluding non-recurring items EBITDA 1 (SEK million)
  14. 14. CAPEX CAPEX as % of sales CAPEX (SEK million) <ul><li>Tight CAPEX control </li></ul><ul><li>Transmission CAPEX booked into fixed </li></ul><ul><li>UMTS will increase CAPEX </li></ul>1) Excluding non-recurring items
  15. 15. Regulatory issues 2003-2004 <ul><li>New Communications Market Act includes extended network access rules (MVNOs) </li></ul><ul><li>Uncertainty of possible new SMP obligations by the National Competition Authority (NRA) </li></ul><ul><li>Mobile number portability (from 7/2003) </li></ul><ul><li>New Communications Market Act includes an obligation to provide bit stream access – may open up new geographic areas for broadband </li></ul><ul><li>NRA demands lower mobile termination tariffs </li></ul><ul><li>Finnish Parliament has proposed a study on the Finnish fixed-to-mobile interconnection model </li></ul><ul><li>Finnish Competition Authority is investigating operators’ pricing of ADSL products </li></ul>
  16. 16. Summary TeliaSonera Finland is the market leader in telecom industry <ul><li>Profitable Growth </li></ul><ul><li>Customer Orientation </li></ul><ul><li>Improved Efficiency </li></ul><ul><li>Strong player in Finland </li></ul><ul><li>Growth saturated, but opportunities exists </li></ul><ul><ul><li>Mobile voice and data usage growing </li></ul></ul><ul><ul><li>Fast broadband growth </li></ul></ul><ul><li>Improvement in integration of service offering and user interface an opportunity </li></ul><ul><li>ICT-strategy implementation </li></ul><ul><li>Increasing attention to internal efficiency, rationalizing program will continue </li></ul>
  17. 17. <ul><li>This document contains statements concerning, among other things, TeliaSonera's financial condition and results of operations that are forward-looking in nature. Such statements are not historical facts but, rather, represent TeliaSonera's future expectations. TeliaSonera believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions; however, forward-looking statements involve inherent risks and uncertainties, and a number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement, including TeliaSonera's market position, growth in the telecommunications industry in Europe, the effects of competition and other economic, business, competitive and/or regulatory factors affecting the business of TeliaSonera and the telecommunications industry in general. Forward-looking statements speak only as of the date they were made, and, other than as required by applicable law, TeliaSonera undertakes no obligation to update any of them in light of new information or future events. </li></ul>Forward-looking statements
  18. 18. The Nordic and Baltic telecommunications leader