Telia Company AB (publ)

Jesper Wilgodt - Head of Investor Relations Johan Eric Dennelind - President and Chief Executive Officer Christian Luiga - Senior Vice President and Chief Financial Officer

Maurice Patrick - Barclays Capital Terence Tsui - Morgan Stanley Stefan Gauffin - Nordea John Davies - Grupo Santander Peter Nielsen - Saturna Capital Corporation Ulrich Rathe - Jefferies Allan Nichols - Morningstar James Britton - Nomura Securities Nick Lyall - Société Générale Georgios Ierodiaconou - Citi Stephane Beyazian - Raymond James Barry Zeitoune - Berenberg Sunil Patel - Merrill Lynch Henrik Herbst - Credit Suisse

Good morning, all, and welcome for this sunny morning in Stockholm and the presentation of TeliaSonera’s first quarter results. I’m Jesper Wilgodt, Head of Investor Relations.

And with me to present today, I have our CEO, Johan Dennelind; and our CFO, Christian Luiga. After the presentations we will have a Q&A session as usually.

And we intend to close this session within one hour. By that I would like to hand over to Johan, please.

Thanks you, Jesper, and good morning to all of you. I think the picture could be live picture actually from sunny Stockholm, so that’s good.

Let’s take you through the highlights of the quarter and then as Jesper said, go through some questions. We were looking for a number to symbolize the first quarter.

Last quarter, we actually had the number 4, this quarter it is number 5. We’ll see what the next quarter will be.

But on February 5, we had the approval of the acquisition of Tele2, which I’ll come back to, has been a very good start. As you know we also had a very good resolution on the five year problem resulting in a SEK 5 billion gross dividend to TeliaSonera from Turkcell.

And this year we are stepping up our fiber ambition even more, 25% higher delivery of 5 villas per hour, which is still not meeting the full demand which is exploding in Sweden. Let’s go a little bit deeper than that and look at some progress and challenges.

We see a solid demand in Sweden mobile and data drive in Sweden. We’ll come back to what that means also to some extent in relative terms.

A very strong continued growth in Nepal, I should also add Uzbekistan, but we’ll come back to that. Turkcell dividend as I mentioned.

Then on the more negative side, we have a group margin that is impacted as you have noticed already by higher equipment sales, almost 1 percentage point of the drop in margin as related to equipment sales on group level, which we’ll cover more in detail by Christian. Then we still have our macro challenges in many of our footprints and I don’t think we’d need to dwell on that, but the Russian ruble and the impact and the uncertainty is still spreading across many of our footprints and that is impacting our numbers as well and I’d point you to those later on.

Especially Kazakhstan, we have issues not just macro to smaller part. We have a competitive problem in Kazakhstan where we are not yet up to our potential and still losing market share.

If I should add one arrow on this slide it’s the one that is as according to plan and that is the numbers on group level, roughly on our plan. It is a slower start Q1 as we have highlighted and we’re sticking to our plan and we expect it to improve over the year.

Let’s look at the headline numbers for group. We are still in negative growth if you look at the organic service revenue.

Of course, on reported it looks strong, but again lot related to FX. We have currency tailwind, almost two-thirds of the reported net sales growth is related to that.

And then we have equipment sales helping up and then some M&As. If you remove all that you get to a negative 1% service revenue growth Q on Q, slightly better than last quarter by the way, which was 2.2% negative, so it’s improving on a sequential basis.

Group EBITDA is also down on local organic, which we’ll cover in more detail. Sweden in focus in this report, let’s start with some of the good things.

Consumer side in Sweden is if you combine fixed, mobile and TV still delivering solid numbers whether they are superb or not, we can debate, but they are growing. And Q on Q it’s up in growth pace.

Obviously, this is the combination of fixed and mobile. Some parts of fixed are declining.

The fiber revenues are increasing and notably here you have the one-time charges for fiber installation included. So removing them you still have an improved growth trend on the consumer side which we’re happy about.

On the contrary, on the enterprise side B2B, we are still in negative growth territory. We are seeing though some improvements in some core segments SME and SoHo, but still quite rough on the competitive side and price erosion side on larger and public segments.

But as you know, I’ve said that repeatedly that something we are aware of and we are defending share and taking our customers into future-proof solutions, which has a short-term negative impact on our revenues. Moving to profitability in Sweden, we see a pretty big impact on the EBITDA side.

And Christian will break it to further down in detail, but the highlight is, it’s a lot related to our increased market investments in Sweden, both equipments and marketing is a large portion I think around SEK 180 million of the drop in EBITDA. I’d also like to remind you that the fixed decline is resulting in SEK 80 million per month impact in EBITDA, which we don’t have to compensate, which we do to large extent in mobile.

So the product mix is impacting us also to some SEK 40 million expenses. Moving over to Europe, a little bit brighter picture even if local organic is down.

We have a Finnish situation there where basically it’s flat if you remove the MTR effect from service revenue - reported it’s down. We have Spain, who is out with very interesting data proposition with €29 for 20 gig, which is working well so far.

And it’s also seen in the EBITDA improvement for Europe, Spain contribute quite a lot. If you remember Q1 last year it was a negative EBITDA and Spain is now stabilized where we have a formula to grab share and maintain a run rate on EBITDA.

Norway, as you know we closed the transaction in the mid of February and we have since then moved 1 million customers over to our networks, so improved coverage and network quality to 1 million customers coming over to NetCom and TeliaSonera. We are around 40% market share now and looking forward to drive the real alternative to Telenor in the Norwegian market with new CEO on board from June 1.

And we will see synergies now coming through in quarter two onwards and we are still expecting the SEK 800 million - at least SEK 800 million as an effect of the synergies or the full run rate effect in 2016 and onwards, so sticking to our plan and a good start in Norway. Looking at Eurasia, you could say we are back to growth in Eurasia, which is good.

We still though had some challenges in the Eurasian market. The big effects on that reentering into growth territory, a couple of things, Nepal is stronger than before, and also Azerbaijan has stopped the decline.

The turnaround in Azerbaijan is happening. Also Kazakhstan is better than last quarter, but not good enough obviously with 10% service revenue decline and I’ll come back to that a bit later.

But the mix is back in growth territory but facing a lot of macro challenges in this market as I mentioned. Notably, so the remittance market from Russia into some of Tajikistan and those markets are impacting a lot on the numbers.

Kazakhstan, I mentioned a couple of times, it doesn’t look pretty at all, it’s minus 10 and losing share, as outside a good thing Kazakhstan and Kcell is that we have a new team in place, very focused on a turnaround plan and they are confident to step up the performance from here onwards. And they’re also reporting the numbers to the market today obviously, and if you’re free to listen in to them directly.

We feel also confident that during the year this will turn. And get back on grabbing share.

Today or actually yesterday, Kcell launched a new proposition in the market to as part of this regaining the share, where Kcell now includes also off-net minutes in the bundle which we haven’t had before. So I think that will help to stabilize the decline.

Then the big news in the quarter obviously was the agreement on dividend and that’s obviously the headline and the great news. I’d like though to remind you that this is far from the full resolution that we’re looking for in Turkey, but it’s a very important step, where we have shown over the last 18 months or so that the dialogue that we have with our key partners and stakeholders is working.

And I think we also need to be hopeful, that we can do more progress together resolving the two major outstanding issues, of course, the obvious one is to get back on the board where we don’t have presence. And also two eventually solve the deadlock on the ownership issues is something we are working intensively on as you know.

I’d also like to mention that, as you know Turkcell have gotten a new management in place and we are working closely with them to see if we can help in any way as a large shareholder and sharing best practices. I think that is enough said on Turkcell.

Well, maybe one note that you will see in Christian’s presentations later is that in the reported numbers, we are reporting, of course, Turkcell’s Q4 and have a pretty negative effect on the EPS from Turkcell and MegaFon. I think it’s about SEK 500 million plus for the quarter that is relating to our associates.

We had an AGM recently, where we published our combined Annual and Sustainability Report, an important step towards the full integrated report one day. And this has been well received.

We also had in conjunction with AGM a sustainability update with key updates from some of our experts and engagements around important topics for us that was very well received then we appreciate all the feedback we have gotten. And this gives us great encouragements to continue, the hard work that we’re doing in many of these markets to stand up for - for instance, freedom of expression, but also to improve our governance and compliance across the footprint.

And we issued our second Transparency Report, which is also part of our freedom of expression ambition at to show the dilemmas that we’re facing and talk about it openly. Then we also as the last bullet says here, we continue to upgrade our framework for responsible business, and the last quarter and going forward we were lot focused on the supply chain, making sure that all the parties and partners that work with us adhere to our new standards of doing business.

We’re also very much focused on health and safety. We are earlier there in our work, but very important piece of work that not only will help our business improve but will help societies improve and save lives.

So all-in-all, we’re pleased with the progress but as always when I talk about our sustainability work it is a long journey. Then another area where we in the Capital Markets Day back in September talked about our new journey, how we are aiming to be at our full potential in 2018.

A core part of that is our transformation journey, where we have put out SEK 2 billion investment program over two years in order to save SEK 2 billion with full effect from those investments. And this one that mainly related to Finland and Sweden in technology when it comes, or group technology, when it comes to Invest-to-Save.

And we are progressing somewhat slow start. We have only invested SEK 100 million in these programs but we are confident that these programs are overall on track.

We’re aiming to improve the customer experience, which we measure with net promoter score and both Finland and Sweden have aggressive targets on really measuring that, committing to that, and getting the customers happier through some of these results that we were showing here; fewer IT systems, easier to deal with; more sales and service online, et cetera. Those are really, really important part of this transformation, where we need to have patience.

So this we will continue to update you on as part of our commitment. I will end with our outlook.

I don’t know if it will be smooth sailing as it looks, maybe some rough seas, but we’re sticking to our guidance for the year where we have EBITDA around the 2014 level, CapEx around the SEK 17 billion and hopefully also dividend above at least SEK 3, I should say, at least SEK 3. So with that Christian, I will hand over to you.

Thank you very much. Good morning, everyone.

I like to start with just a small detail in a report around our number of customers. We have changed our definition what we report to the market this quarter.

So we have now a three-month activity that is the limit for if we include them or not in the reporting. So we did increase the number of customers 2.1 million since last year, over a year and 2.6 million during this quarter.

But you will see that the base has changed but also this has been recalculated for all periods. So it shouldn’t be difficult to understand the trend.

So in Spain we still have 4 million customers in our system but we report 3.5 million right now. The first quarter as Johan said is very much as we expected.

We have a slight decline in service revenue growth, but on total revenue the increase is 1.5% and it’s very much related to equipment and I’ll come back to that. And that is also the reason - one of the main reasons why the profitability is down in the quarter compared to last year.

The EPS is fairly flat on this picture, minus 6%, but it has a lot of swings in it, and I will come back and explain a little bit around that later on. And the cash flow is improving which is positive and working capital is one of the items that help us to bring cash flow up 12% in the quarter.

Currency effects are significant in this quartet and I think this picture illustrates this very well, 5.6% on revenue of the 8.8% reported comes from the currency effects. And even though we have countries like Azerbaijan that have made a devaluation, the Swedish krona has been quite week for the recent year and therefore we have a strong impact from currencies.

So euro is one large currency in our portfolio, of course, and with the 5.9% increase towards the Swedish krona that the impacts report to number 12. But also Nepal, Kazakhstan, and Azerbaijan Tainga [ph] even though they have made devaluation has an increase towards Swedish krona.

The Russian ruble is down 30% and that is affecting the reported number of MegaFon’s income in our reporting of course. So that has deteriorated quite a lot from that.

The equipment sales is up, and as I said, this is one reason for the lower result. If we look at this picture, we can see that 2.4% of the increase comes from the equipment sales.

If we just stopped for a while on the billed and service revenue, we can see that mobile revenue, billed revenue is flat. We have countries like Spain and Kazakhstan that is negative, and we have countries like Sweden, Norway, and also Lithuania, Latvia that is positive.

So they balance each other out. Interconnect is fairly small on a group level, but if you look at Kazakhstan and Finland it will have major impact or a significant impact, so we should remember that.

On the fixed side it’s primarily in Sweden. It’s slower this quarter on comparable notes and it’s both a little bit around the price increases we had in the first quarter last year that we did not have this year yet, and also on some of our three months for free offerings that we have had in the market on both broadband and TV.

And they have ended now in this quarter, so we’re not giving out any more free - months for free offerings in those segments. The equipment sales in Sweden is illustrating a driver for our bundled offering sales and these bundled offering sales are actually carrying quite a lot of SEK.

So we have a high equipment sales cost to this and it makes the offerings around equipment negative. And of the Swedish sales this is pretty much - it’s more than one side of the cost difference.

We have also FX impact on the purchase of equipment that also brings higher cost to the Swedish operations in this quarter, all of them actually but primarily to the Swedish one, because of the increase of equipment. So that is that why this is important to see this.

The other thing with his picture is that you can see already in quarter three it started to pick up and we believe strongly therefore also that with our view for the future that the comparables for the second half will be much easier when it comes to equipment sales. The profitability otherwise with the OpEx and service revenue balance is okay.

So we have worked with our OpEx and we have countries like in Finland where we have the increase in the service level cost in quarter four. We decided actually to continue with that to make sure we have a good customer offering and think it’s worth it.

Meanwhile, we have in other countries a decrease in OpEx, so that balance is working out well. So the main reason for the EBITDA decrease is the gross margin.

On the gross margin, 1 percentage point comes from equipment. We have some storm cost in Sweden.

It’s not the big part, but it’s SEK 40 million Swedish krona and we also have some changes in the fixed side. With the fixed side is going down and that impacts the gross margin.

So those are the three elements to remember on this. We believe, as I said, that the comparables on equipment will be much easier.

We also have a strong view that the performance will be better in the next three quarters on a comparable note. So this is a little bit according to our plan.

EPS, we have an interesting income statement this month - this quarter. Associates are down, mainly currency effects.

These are known numbers. It’s quarter four reporting from MegaFon and Turkcell.

And then we have FX impact on the operations and then we have net financials. We had actually positive impact from currency effects in our financial net from the devaluation in Azerbaijan.

We have a lot of our cash as we have said before in dollars. So with the impact of the dollar increase have actually given us FX effects on the net financials.

Then we did an intercompany transfer of assets in the quarter and that gave us a positive effect on the tax side of around SEK 500 million. CapEx is up and one reason is the change in Eurasia.

Last year we had a very slow start in Eurasia. We talked about that, but now we have a better start and stop if you want.

In Sweden, it’s quite flat, this is quarter 50%, close to exactly 50% comes from fiber rollout and 20% comes from the best network that we are getting into in Sweden when it comes to 4G. In region Europe, the increase in the biggest part of the CapEx from the 4G rollout both in Norway and in Finland, but also from the capacity build that we are completing with the Tele2 acquisition on our network in Norway.

In Eurasia, it’s primarily Uzbekistan and Kazakhstan and Nepal that stands for the biggest shift here. And these three years where we have growth and we want also to have a superior network to be able to be competitive.

So that’s where we have the CapEx. On the best network in Sweden we work with three elements: Wi-Fi, which what I’ll keep out a little bit now; but 4G; and the fiber investments.

On 4G, we have said that we want to have 92%. We will have 92% area coverage and 99% population coverage we already have.

Today we are around 60% on our area coverage and we are expecting to be around 90% at the end of the year and this is progressing as expected. The fiber roll out is going very well.

We had good weather conditions. We have lesser problem with the supply on the some supplies that we have in this part.

We have a 48% sales - for sales on our penetration on our sales in the first set, and last year, we had 42% who have increased the number of hit rate - the number of hit rate when we have our sales in fiber this year. So that’s good.

We are today having two-thirds of the orders closed on the five villas per hour that we are going to deliver this year, so it feels good. I think this is all as expected and maybe even a little bit better, and it feels good that we will deliver on our target for this year on the fiber.

Cash flow generation has improved. Two main elements on this picture is the tax.

We have a tax refund in Sweden that impacts the tax part and also we have a working cash flow shift upwards. These are negatively impacted by the cash CapEx from the higher CapEx that I just talked about.

The change in working capital is primarily Spain, which is positive. We had a lot of handset equipment impact before we moved over in between quarter one and quarter two last year to an off balance sheet model, and that starts giving impacting the numbers, but also in the Nordics, we have a general improvement that is coming through now.

On the negative side that actually takes this down a little bit just the handset sales in Kazakhstan. The net debt I have decided here to illustrate the quarter one compared to last year to see one-year perspective on this.

And if we look at the one-year from last year, we started with about SEK 53 billion in net debt. We have a free cash flow and has been positive of SEK 13.3 billion, and then we have made a dividend payment of SEK 13 billion, so they match each other quite nice there.

And then we have net M&A activities of SEK 4.2 billion, and then recently we have announced if we go a little bit further on the picture to the right, the SEK 4.5 billion we got in dividend from Turkcell. So the big or the big, the small shift we’ve had in quarter one 2014 to quarter one 2015 is actually the FX effects on our balance sheet and our loans, it’s around SEK 2.9 billion.

So it’s a quite stable situation compared to last year and we are at SEK 1.72 in net debt to EBITDA. Good.

Thank you.

Okay. Thank you, Christian.

And it’s time to open up for some questions, and I think we’ll start with the floor and we have some microphones over there and you can see some hands, one in the front.

Yes. Hi, Johana from SEB [ph] two questions, if I may related to the Sweden.

First of all, if you can comment anything on service EBITDA if you exclude handsets the development year-over-year the EBITDA margin that is. And then if you can give some proxy on how much of EBITDA that’s related to the B2B side where you face challenges currently?

Thank you.

Yes, I’m sorry, we don’t go into the B2B or B2C margin here, and we will not relieve that today to you. On the EBITDA for the service business, I would sort of push it back and say, as I said, the equipment sale has an impact of pretty much a little bit more than one-third of the comparison for Sweden the last between the years is coming from equipment.

So the rest is coming from the rest of the business.

All right. Anymore question here?

[Over there, Thomas] [ph]

Thank you. A question on CapEx with so much more CapEx going into Eurasia, while at the same time perhaps a little slower growth than we’ve seen in previous years.

So how do you balance that on a process basis? How do you look at investments in a country say like say CapEx time.

And will we - should we expect similar to the levels we have today, as we move into data also in those regions, or can we take down CapEx a little bit in coming years given that revenue growth is slowing a bit. Thank you.

There’s a couple of points on the CapEx for Eurasia. We have started earlier with the implementation on many of the build-out programs in Eurasia already late last year, or Q3 actually last year for approvals and process.

So that’s why you see the Q1 coming up better this year. But then also reminding of what we have been talking about in when it comes to some of the networks in these markets, some places we have been underinvested actually, and we need to invest up to the expectations of our customers and they are a lot now driven also by the data demand that is picking up.

So and then the third point obviously, we are not giving guidance on market by markets with CapEx, but we are in bit of an investment phase for some of the key Eurasian markets, that’s for sure.

Okay, anymore question here, or should we perhaps or move on to the conference call operator, could you please open up?

Yes. Hi there, guys, Maurice here.

So a quick question on the Spanish market, you’ve seen some recent price increases from Telefónica and Vodafone in the marketplace. You obviously talked yourselves about your high 20 gigabyte package there, but your thoughts on general pricing in the Spanish market overall, and if you could touch on potential limit is from the proposed R&D data merger, that would be helpful as well.

Thank you very much.

Thanks, Maurice. On the last question on investment, it’s not something we really can go into any details about where we’re active in providing our views on that merger, Yoigo performance as I mentioned is fairly predictable, I would call it at this point.

So we have launched an attempt to continue to gain market share against the big three, which we are doing, that’s seen in the 2014 statistics, and we have a slight decline versus the MENOs [ph]. But I guess the big ones were winning and this new proposition helps to further strengthen our position in the data market in Spain, which still is to some extent a majority, or is more to do in the Internet space in Spain that we will drive that market and grab share in the Internet space.

Okay, great. Thank you.

Yes. Hi, guys.

Just a quick question on Swedish fixed, Com Hem has been pretty open up by moving its strategy from an ARPU growth strategy versus the market strategy it has had. And have you seen any early signs of that and do you believe there is scope for a period of price increases going forward as you launch fiber?

Thank you.

Thank you. I think given the demand out there, I’m sure there are segments that are prepared to pay more, which will have defined in a smart way.

We’re doing our attempt as you know. Last year, we had a price increase in some of our core propositions and in the broadband.

And we are looking to see whether we can adjust some of the prices also t this year, but remains to be seen for obvious - obviously I can’t really comment.

Okay. Thank you, guys.

Thank you, and good morning. Just got a couple of questions on Swedish mobile.

You mentioned that the B2B market is still seeing challenges, but on the other hand just you are seeing some green shoots of recovery. May be you can just elaborate on some of the bits, where you are seeing a bit more optimism?

And then second is still related to Swedish mobile. Just on the consumer side, obviously, the big change was steady to increasing their data buck allowances.

I was just wondering when you look at your KPIs in terms of subscriber net ads and ARPU, what would be the trigger point for you on your KPIs for you to actually respond with more common reductions in your pricing strategy? Thank you.

Thanks, Terence. Let me start with the consumer one.

Actually, we just saw from our numbers, it was a 2% increase, I think we mentioned on mobile overall. I can point you to the Consumer segment being 6% in Sweden, which is strong, maybe not winning out there, we’re seeing some other results today, but it’s a strong momentum on consumer mobile.

This is driven by a couple things. One obviously is the increased investment that we have shown, which has a price tag.

And the other one is the strengthening of our brand and the network perception again with where we are leading and we’re seeing an effect of that. So when it comes to price decreases, I’m not sure that’s how we’re thinking.

We are thinking again here to see where people are prepared to pay and what they’re prepared to pay in the respective segments. I’m sure there are areas where we can also work on some upwards adjustments.

And a comment there as well, I think when it comes to these doubling of data mania, that’s something we are not very keen to join, but of course have to be part of in one way or another when it happens. But now we’re working closely, internally here to see if we can change the dynamics somehow, so we’ll come back to that as we move along.

In the B2B side, it’s as you say and as I say it’s a tricky situation. We are looking for the positive signs and there are some segments where our new way of addressing these SME and the SoHo is starting to work both stronger, clearer, messaging and branding, and also now introducing better products, and some key launches also in Q2 will help.

But we have seen a stabilizing trend on the porting side versus key competitors, which is positive. And I’ll stop there.

Great. Thank you.

Yes, good morning. First of all, I’d like to comment that please if you make larger restatements, please inform a bit ahead of the report which would help make the correct interpretation.

And then I would like to move into Kazakhstan. First of all, I think that we saw a large improvement in Azerbaijan and I would like to hear if this is, if you’re seeing a real improvement in the market or if this is due to that you had quite an easy comparable quarter for last year.

Secondly, you talked about changing the strategy in Kazakhstan in order to start to gain market share again. And if you could just comment on what type of actions you’re making in Kazakhstan?

Thank you.

Let me lead of the Kazakhstan and then leave it to Christian with some of the details. And I agree by the way on your first recommendation, we’ll take that on board.

Kazakhstan as you know is pretty much the size of Europe, very regionalized, wherein some segments we are very dominant, and then some other geographical areas we’re more of a challenger. And that’s how we need to go to market as well.

And you will see more of that in the coming quarters. As I mentioned yesterday was the launch of a new tariff plan aiming at first stabilizing the trends, because they are still declining.

And then phase 2 start working on the improvements there in the core area, so Kazakhstan. And to the details there, Christian.

On…

On Kazakhstan, there was a question on - wasn’t that on the - I didn’t pick up, I think it was a customer question.

I was asking more of what the type of actions you’re making in Kazakhstan. And then secondly, it was question on Azerbaijan, because there it was a quite dramatic improvement in sales growth just one day, if we are seeing improvements in trends or if it’s more that we had an easy comparable quarter from last year.

I think we should see rather that we said in quarter four that the impact of the minus 10% we had around at that time was both regulatory, but it was also one-time charge effects on the revenue, and these are gone. And then to say if it’s strong trends on minus 10% to 0%, it’s wrong of course, because you have to restate a little bit to minus 10.

And then you have a slight improvement to this quarter. And it’s too early to say, it’s a strong trend in anyway.

But it’s an improvement, then we feel that much better in this quarter than we did in the last quarter. So that’s my comment.

Okay. Thank you.

Good morning. I have another question on Spain.

Regardless of the shape of the remedies or otherwise which I understand you, you don’t want to go into any detail on in quite sensibly. And would you consider allocating further capital to the Spanish market if that became a sensible move for the [indiscernible]?

Thank you.

Thank you. I don’t know - if you refer to capital as being aggressive in acquisitions, the answer is no.

If you refer to investing in the market in various ways, yes. According to the current pace we are - I mean we have an operation which we need to develop and we’re doing that and we’re investing both in the market and in the network.

Okay. Thank you.

Thank you. Just a question related to Sweden as well on the fiber side.

You’re talking about strong momentum. Could you elaborate a bit on where this momentum is coming from?

Is it from sort of STUs where you - the people who do not have fiber today and where you have little competition? Are you also seeing momentum in areas sort of NCGs [ph] MDUs, where you are in competition with others, please?

And then secondly, can I just follow-up on your comment you had about Turkcell, I don’t know how much you can tell us, but are you concerned that the recent developments between [Elitma and Çukurova] [ph] sort of we’re entering a new phase of a prolonged court battle here regarding this ownership? Thank you.

Hi, Peter. You know, I don’t comment on the other parties’ discussions in Turkey.

I can comment on my discussions with some of the others, but this one is purely between the two of them. On the Swedish fiber, yes momentum is on STU a lot.

And that’s where we have a good model now for rolling out, but it’s not no competition as you indicated. It’s quite strong competition, where we are fighting to be first in - of course if you’re first in, then you got a good position to capture the local neighborhood so to say.

Okay. Thank you.

Yes. Thanks very much.

Two questions please, the first one is on equipment sales. I mean, equipment sales is very high.

What I’m wondering is in particular in Sweden now, whether it is possible to somehow split the reasons for this growth between your replacement cycle due to attractive new devices and have been launched late last year. And the commercial activity particularly driven by it, as I understand, so is there any way to sort of disaggregate that between the bump from the device replacement cycle and just from the commercial activity?

The second question is just a - an attempt to clarify. When you say equipment is one-third of the loss in Sweden, could you just be a bit more specific what quantities are you talking about there?

So what is the third of what that is attributed to equipment, is this costs to EBITDA or you can tell the sure what this one-third refer to? Thank you.

Okay.

A good question on the equipment side, I…

You can come back to it. Let me start on the general reflection on the device and equipment market because we’re seeing that in many of our markets.

Now, the desire to upgrade to better handsets, because lifestyle is changing and people are watching. We’ve talked about watching TV on the handset 10 years ago, today people are.

I mean, as you know in this room but many out there, maybe not now, how developed the market is becoming in Sweden and some other markets here in the Nordic. It is really a part of everyday life now.

And people are desiring to have better handsets and this is where you see a lot of this drive. I don’t think we have the optimal mix today between push and pull, and that’s something we are tuning for the rest of the year.

And that’s part of the improvement plan for the year in notably Sweden, and that’s where you come into the numbers the mix on EBITDA, Christian, which you can comment on.

Yes, thank you. On the - what I meant there was that the last year compared to this year we have a drop in the Swedish profitability in EBITDA.

And of that drop a little bit more than one side is related to the increased equipment sales.

That’s very helpful. Can I just follow-up on the first question on the disaggregation of commercial activity versus the replacement cycle?

Is that is what we’re seeing in Sweden really that in an iPhone crazy country, people want to have iPhones as the new iPhone arrives and therefore there is a big sale or is it really more that commercial activity, a bit of a haggle for market share that’s being kicked off by new tariffs in Tele2 is really the major driver of these device sales, that’s really what I’m after.

It’s a good question, and remains to be seen. But it’s a lot of upgrade to better handsets generally, and I think there we need to find our optimum mix.

Of course, there are different prepositions out there bundled and unbundled, where I think where also work to be done to clarify our propositions versus some of our key competitors. So but I wouldn’t say it’s a price or a reward for market share based on subsidies on the handset at this point.

Thank you very much.

Hi. In Eurasia, you only actually had wireless subscriber growth in Georgia, Moldova, and Nepal.

You’ve talked about Kazakhstan, but I would appreciate if you could talk more in general, is there a slowdown in growth, because we’re hitting a peak in how many people want to have a cellphone, or is this more because of Russian influence on the economy, or what’s going on there, and what’s that outlook for future subscriber growth in that region? Thank you.

Thank you. I mean more of a general comment, see if we can go deeper into it and clarify.

But we are reaching high penetration levels in many of the markets if you measure SIM per capita. And that’s when you also see a shift away from subscribers as the main proxy for the next phase of growth, where I think is much more on how you develop the existing base ARPU development and get the data growth going, which we are seeing in all our markets actually, and that’s why we also need to stimulate that with better networks and also get the right mix from the start when it comes to handsets, because that’s really the missing link in many of the markets to have the right answers out there for consumers to pick up the Internet mania.

But subscriber number I think also you need to take into consideration the restatement which is happening in some of these markets, so we have gone to 90 days. But yes, overall there is a slower growth on subscriber.

Thanks very much. It seems ARPU pushed up prices in Scandinavia last quarter.

So just wondering, do you expect other handset vendors to follow the days of talks at the currency impacts? And do you see any challenges in parsing this extra cost through to customers?

And then following on from that, what are your latest thoughts on moving more towards some early model to help defend your product from price - the price increases attached to these handset costs? Thanks.

From the handset, the short answer is yes and no. We expect others to follow and we do pass it on.

On SIM-only, we have had a SIM-only plan for some time. We haven’t, I think made it the anchor product in Sweden.

And clearly, there are very well-defined such plans out there now, which are more of the champions and the heroes - hero plans, and we will have to find our balance there between SIM-only and bundles. And as I mentioned, we don’t have the optimal mix in Sweden yet that’s you could already see in the investment level.

Okay, thanks.

Yes, morning. This is Nick at SocGen.

Could I ask a couple please? On Sweden firstly, back on mobile, just to quantify you mentioned SEK 180 million of marketing cost for the quarter firstly.

Is that likely to recover over the next couple of quarters, you’ve extended your double data promotions, for example, to the end of May. So I’m assuming that Q2 stays difficult in terms of marketing costs as well, could you clarify that?

And then secondly, on the Norwegian market, I think you mentioned new great changes, so I’m assuming you’ve not seen any churn in the base that you’ve taken on firstly. And then and secondly, could also give us a little bit of detail, I know you won’t give exact details, but a little detail on the wholesale contract with ICE please.

Could you tell us why you decided to give the terms you’ve given and why you relax that it doesn’t suddenly unleash more competition maybe in the second-half of the year? Thanks.

Thanks, Nik, Norway first. I think as a result of the last quarter and the migration and closing of the deal have not resulted in any churn in that term.

But since the announcement of the deal back in June, July last year, July last year, of course, we have seen a very aggressive incumbent there, which I think has to be honest grab some share in some of the segments, which we’re now fighting to grab back. And on the related note and ICE, they have gotten a deal from us, so it’s part of the remedy discussions, and we think it’s a balanced remedy pack in the end, where we also have secured a good wholesale agreement in a ray with ICE, and I don’t think that’s anything out of the ordinary, so not worried about that as per se.

In Sweden, yes, I mentioned the 180 number, which is a mix of increased marketing investments and increased cost for subsidies and handsets, and that includes the FX effect. So back to my point, I don’t think we have the optimal mix, we need to tune that, and yes, we do see improvements over the year in the Swedish mix and gross margin.

Thank you.

Yes, hello. I just have a couple of questions, are follow-ups actually.

Firstly, going back to the margin question, there is an implication or a significant improvement in the rest of the year. And you did comment about finding their own mix of subsidies versus SIM-only perhaps or other type of plans.

Is that the main driver for the EBITDA improvement for the rest of the year, or other any other underlying, say gross profit kind of drivers that you can also highlight on that? And then secondly, just on Norway, I was just wondering what was the benefit you had so far in the first quarter from the migration of the roaming from Telenor to your network, and what would be the comparable one in the coming quarters, do we go to zero roaming payments from the second quarter, does it take a bit longer?

Thank you.

I will start with the first question on the rest of the year. We believe an improvement and it will come slightly than starting in quarter two.

As you say, we have an improvement on the mix in Sweden on the equipment and that will come through. That’s something we believe in.

We also believe that the lost we have on fix would be somewhat slighter. And we also continue to drive our cost program both on the COGS side and the OpEx side.

And we announced this quarter some resignations in Sweden, and we do programs for - on resource cost as we say consultants and employees we look at together resources in the rest of Nordics and the Baltics throughout the quarters. The second question please?

On the synergy at the Norway and I mean, where we had transferred the Royal traffic now into our network and we would see the synergies come through, so that being the second quarter than the full synergies that we have talked about in Norway on the 800 meters on an annual basis will be achieved in 2016.

The - and we should also just say that the two business was then merging at the middle of February, and it came in with a loss.

Thank you. My question has been asked already.

Thank you.

Hi, just for Sweden, I’m just interested in why you’ve decided not to increase the prices on some of the fixed portfolio this year versus increasing them last year? And then my second question is just when I look at the overall growth in the fixed line business in Sweden, clearly you are doing very well in broadband then and the landline losses is relatively constant.

But TV is - has seen a notable slowdown, both from an ARPU trend in recent quarters, but also more recently this quarter looking at the apps, which slowdowns. I was just wondering whether you’re optimistic on being able to see a revenue inflection in Sweden more generally or whether actually you are looking at slower TV trend and thinking that’s going to be harder to achieve.

Then the third question just if you can give us some stats on what proportion of your sales in mobile more generally in Sweden are SIM-only today, and what you believe they should be from a mix perspective? And then final question is just on Spain, on whether you see any kind of medium to long term margin opportunity from using VoLTE as a means of moving away from your roaming arrangements with Telefónica?

Thank you.

All right, Barry, let’s walk through on the four questions here and help you understand. The fixed side, we haven’t as you mentioned had a price increase.

We have had some campaigns going from Q4 into Q1 and wanted to monitor the results of those campaigns and see what response have been. I think going now Q2 onwards, I’m sure there are room for some price adjustments in some segments, which we’ll of course exploit.

But again, it’s not just increase in price as a standard formula. You need to understand what the customer needs and what they’re prepared to pay for.

So it will come when it comes. TV, yes, it’s a slowdown, but still a great place to work with in bringing the new TV experience into the market, which of course a lot of things are happening moving from traditional to OTT, where we need to have our role clear, and that’s work ongoing.

And the sales mix, I want to really comment on what our wanted position is and how we are going to tune there going forward. You will have to follow that going forward.

I don’t think we released the mix either on…

No, we don’t.

..on the Swedish side, so thank you. And Spain, margin opportunity from VoLTE and I think it’s more how we use our existing proposition there to deliver data and VoLTE of course will help that experience when it comes.

But not now seen as a margin booster per se. It’s more as strengthening the current position and the momentum that we have on data plans.

Okay. If I can just ask one follow up, when you mentioned finding your place with OTT in TV in particular and think of potential, what - can you expand on that in any way, like how do you see your position in the TV market?

We talked about it previously and we have our test version, you could call it, from a more of a strategic perspective it’s a test version. From a consumer perspective of course it’s a good product which is Telia Play+, which is an OTT product.

And we need to understand how we leverage that in combination with the traditional IP TV offering that we have to 700,000 households in Sweden. But it’s something that’s constantly being monitored and developed.

So when we have something big and new to talk about, we’ll do that.

Okay. Thank you very much.

Good luck.

Hello, thanks for taking the question. I just have one question on fixed line.

I mean your subscriber-base in the broadband side increased, your ARPU seems to stabilize of there, I think the decline of last quarter, and you seem to be indicating that going forward because your try and buy campaign is ending you should see your ARPU continue to improve. I mean the revenue decline though was still accelerating on a downward basis at minus 1.6% as per the mix effect.

I mean, is there more medium term view do you think where we’re in a - where you can see stabilization in stay, and how long do you think that would actually take? Thank you.

And which part can we talk about?

Sweden, fixed line in Sweden, yeah, that’s - we just wanted to confirm that. In the fixed line we have price increases last year and in the broadband side also and the TV side and we haven’t had that this year yet.

And we will have to review that and see when and how we want to do this. We have said before that it is a possibility to bring up pricing in the broadband side primarily as this is - it’s a less price sensitive.

If you look at the consumer side, I think it’s a very promising development on the new products like broadband and the TV, but they will be just compensating the decline and then on the fixed side on the B2B side we’re still having a negative trend and that will continue, and that’s spot driven.

Thank you. Then…

Again really the question you were asking about the trend. And I can’t really give you a forward-looking statement on the trend.

Yeah, that’s understood. Thank you.

Yes. I have a question about Norway, it looks like your EBITDA is a quite a bit lower with the Tele2 acquisition.

Can we expect this EBITDA level, or this margin going forward, or do you see it something temporary? And secondly, can you give any numbers on your CapEx in network investments in Norway now going forward?

Yes, thanks. On the Norwegian side we had an impact of the negative EBITDA from Tele2 base coming in.

And as I said, we expect that to improve over the year, as the synergies we can both in terms of network and other cost related harmonization in the year, and then full run rate of the SEK 800 million EBITDA effect is down expected in 2016 onwards. So, yes, it’s low on, but it’s improving from here according to plan.

And on CapEx we did announce last year when we did the deal that we would increase CapEx both on capacity that’s moving over the traffic, but also going forward our ambition to get to 98% of the - which is a regulatory requirement in the end on the 4G rollout. So this will impact the CapEx we said in the coming two years with this.

But can you give any specific numbers on the CapEx in Norway?

I think we said SEK 350 million plus - about SEK 600 million in total for both these two effects.

Perfect. Thank you.

One more question before we close in.

Yes, thanks very much. Just going back on Swedish mobile and you’ve had your double data promotion for a while now and you recently extended it.

Just wondering the effective and whether you extending it if we could readout into actually you’re thinking about if this - if this might work, if it does drive and increasing data usage giving consumers more and what you’re kind of seeing, do you see customers use more data as they guess more and because of that they might move up at the same rates through your bundles anyway? Thank you.

Yes, thank you. We - before these double data mainly came in, there were - people were getting used to the buckets and also starting to learn to upgrade.

However, all starting to see an effect of that as the revenue generating thing that of course is much more difficult now. The upgrades, the top-ups, but then as we compensated with more customers on these plans, which are generous, and that we have seen, I mean, we have seen people moving over, I think we are now at 65%…

Close to 65%.

65% on our data plans as we call them. But I think we’re still very early in the pricing era of this proposition.

So I think we can all be better in finding the optimal pricing and that means some segments will pay more, some will pay less.

Okay. But have you seen an acceleration, I mean, presumably you have a lot of customers still on kind of half a gig data bundles giving - making the step-up to 4-gig instead of 2-gig.

Have you see an acceleration of this low-end customers taking a big data bundle, I know?

Won’t go into the splits of various segments there and how they’re moving through the bundles. But generally speaking, of course, the doubling of data has attracted a lot of interest in some, especially in the mid-segments, which are already fairly heavy users.

Okay. Thank you.

Okay. I think that’s close for today.

Thank you.

Thank you.

Thank you very much.