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Interim Report

Interim Report. January – September 2000 November 9, 2000. Marianne Nivert. President and CEO. Focus on core business and streamlining. High-growth areas. Mobile Leading Nordic mobile player Carrier One of the leading carriers in Europe Broadband Leading broadband provider. Trends.

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Interim Report

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  1. Interim Report January–September 2000 November 9, 2000

  2. Marianne Nivert President and CEO

  3. Focus on core business and streamlining High-growth areas Mobile Leading Nordic mobile player Carrier One of the leading carriers in Europe Broadband Leading broadband provider Interim Report 9 November 2000

  4. Trends January–September 2000 • Net sales +6% (+15% in Q3) • Strong sales in high-growth areas • Operating income +18% • Underlying EBITDA totaled MSEK 9,297 • Substantial investments affected earnings • Eniro listed on the OM Stockholm Exchange in October Interim Report 9 November 2000

  5. Increased growth Period Quarter Jan-Sep Jul-Sep • Net sales The Group +6% +15% Mobile +37% +64% International Carrier +27% +64% Skanova +66% +100% Internet, Sweden +24% +27% • Strong mobile growth +1.5 million mobile customers • International Carrier signs contracts worth MSEK 8,200 Interim Report 9 November 2000

  6. Initiatives Cost taken for new services and geographical expansion over the P/L Statement MSEK Rest of world Nordic countries New services Interim Report 9 November 2000

  7. Total proportional customers approx. 5 million The mobile footprint Customers Nordic countries 4,363,000 +1,522,000 Finland 127,000 +94,000 Customers Telia Overseas 1,415,413 +563,516 Sweden 3,147,000 +509,000 Russia North West GSM (12.7% + 9.5%) through Telecominvest 195,000 +69,000 Norway (100%) 810,000 +37,000*) Eesti Mobiilitelefon (24.5%) 316,000 +76,000 Customers Baltic states and Russia 1,029,500 +265,700 Estonia Latvijas Mobilais (24.5%) 248,000 +48,000 Denmark 279,000 +109,000 Latvia Omnitel (27.5%) 270,500 +72,700 Lithuania *) Jul-Sep Interim Report 9 November 2000

  8. 3,200,000 830,000 Norway Sweden 2,950,000 730,000 2,700,000 810,000 3,147,000 630,000 2,450,000 530,000 2,200,000 1 5 0, 0 0 0 3 0 0, 0 0 0 Finland Denmark 2 5 0, 0 0 0 279,000 1 0 0, 0 0 0 127,000 2 0 0, 0 0 0 5 0, 0 0 0 1 5 0, 0 0 0 Apr-99 Apr-99 Aug -99 Aug -99 Dec -99 Dec -99 Apr -00 Apr -00 Aug -00 Aug -00 Dec -98 Dec -98 0 1 0 0 0 0 0 Apr-99 Apr-99 Aug -99 Aug -99 Dec -99 Dec -99 Apr -00 Apr -00 Aug -00 Aug -00 Dec -98 Dec -98 Customer growth Interim Report 9 November 2000

  9. ARPU Churn 7% Sweden, SEK Norway, NOK Interim Report 9 November 2000

  10. Development of SMS No. of messages 114,760,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan 1999 2000 Interim Report 9 November 2000

  11. International Carrier • Net sales +27% (+64% in Q3) Telephony +47% IP +296% • Contracts regarding infrastructure and network capacity signed worth MSEK 8,200 • The fiber-optic network in Europe increases from 6,815 km to 7,513 km Interim Report 9 November 2000

  12. Infrastructure and capacity, investments vs. sold International Carrier MSEK Ducts DWDM Fiber Interim Report 9 November 2000

  13. Infrastructure and capacity, sold vs. remaining International Carrier Km Km Km DWDM Fiber Ducts Decided, but not yet contracted In operation Under construction Sold/swapped Interim Report 9 November 2000

  14. Broadband • Internet customer growth from 613,000 to 720,000 • 22,750 broadband customers plus 14,400 in com hem • 653,000 potential broadband customers through general agreements • Broadband deliveries are speeding up • Broadband services will be launched during Q4 Interim Report 9 November 2000

  15. Fixed telephony • Migration from fixed telephony to broadband • Growth in sales on the external wholesale market partially compensates the reduction in the retail market • New services and efficiency measures compensate the effects of price cuts • Sustained underlying EBITDA margin for established fixed services Interim Report 9 November 2000

  16. Focusing on core business • Listing of Eniro – capital gains of approx. MSEK 6,000 in Q4 • Divestitures (wholly/partially): IN good company AB Starman Kaabeltelevisiooni Svefo Telia Contracting Telia Kompetens Telia Konferens • Focusing on core business in Telia continues Interim Report 9 November 2000

  17. Focusing on core business Listing of Eniro Divestitures Broadband 22,750 customers plus 14,400 in com hem 653,000 potential customers in general agreements Broadband services in Q4 Delivering the strategy International Carrier • Swap agreements with Global Crossing and Colt • Acquisition of AGIS – free peering in the US • Contracts signed worth MSEK 8,200 Mobile • Acquisition of NetCom ASA • 1,522,000 new subscribers in the Nordic countries • Pilot versions of Speedy Tomato launched Interim Report 9 November 2000

  18. Bo Jacobsson CFO

  19. The quarter in brief Jul-Sep Jul-Sep Change MSEK 2000 1999 in % External net sales 13,487 11,771 +15 Underlying EBITDA 3,180 3,466 -8.3 - margin (%) 23.6 29.4 Operating income 206 1,150 -82 Earnings per share (SEK) 0.06 0.30 Investments 16,745 2,121 *) *) of which NetCom ASA 11,387 Interim Report 9 November 2000

  20. MSEK 14,000 12,000 10,000 8,000 6,000 4,000 2,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 1999 2000 1998 Net sales Interim Report 9 November 2000

  21. Total (MSEK) Change in % 11 771 13 487 +64% +83% -11% -9% +22% Mobile 3 596 2 199 Carrier & Networks 836 1 527 Business Solutions 2 911 2 595 People Solutions 4 427 4 041 1 703 Enterprises 1 400 25 -2 Group-wide Jul-Sep 2000 Jul-Sep 1999 External net sales The quarter Interim Report 9 November 2000

  22. The quarter 3 466 3 180 Change in % In total (MSEK) 929 943 Mobile -1,5% -10% +60% -67% -35% Carrier & Networks 1 705 1 892 Business Solutions 186 People Solutions 524 297 174 Enterprises 566 365 -290 Group-wide -645 Jul-Sep 2000 Jul-Sep 1999 Underlying EBITDA Interim Report 9 November 2000

  23. MSEK 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 1998 1999 2000 Underlying EBITDA Interim Report 9 November 2000

  24. Share of earnings and one-off charges Share of earnings in assoc. companies Jan–Jun Jul-Sep MSEK 2000 2000 Netia Holdings (BS) -167 -197 Baltikum (Mobile/BS) 72 76 Unisource/AUCS (BS) 1,063 183 Comsource/Eircom (BS) -520 -280 Telia Overseas (Enterprises) -643 -444 Other assoc. companies 127 -97 Total -68 -759 One-off charges and pensions 1,689 -120 Excl. capital gains/losses in assoc. comp. 1,517 -116 Interim Report 9 November 2000

  25. The nine-month period in brief Jan-Sep Jan-Sep Change in MSEK 2000 1999 % External net sales 39,524 37,234 +6.2 Underlying EBITDA 9,297 10,716 -13 - margin (%) 23.5 28.8 Operating income 4,076 3,441 +18 Earnings per share (SEK) 0.99 0.87 Investments 37,431 7,233 *) *) of which NetCom ASA 22 749 Interim Report 9 November 2000

  26. Cash flow MSEK Jan–Sep 2000 Jan–Sep 1999 Cash flow from operating activities 7,385 7,852 Cash flow from investing activities -37,840 -9,327 Operating cash flow -30,455 -1,475 Cash flow from financing activities 30,133 1,713 Cash flow for the period -322 238 Net interest-bearing liability, closing balance 22,340 8,545 Interim Report 9 November 2000

  27. Financial position Sep 30 Dec 31 2000 1999 Net interest-bearing liability (MSEK)22,340 7,527 Balance sheet total (MSEK)117,521 76,604 Debt/equity ratio (multiple) 0.47 0.24 Equity/assets ratio (%) 40.3 41.0 Interim Report 9 November 2000

  28. Established fixed services continued price pressure strong efficiency measures sustained profitability in fixed services Outlook Carrier • strong growth in all product areas Mobile • increased traffic as a result of strong customer growth • improved margins Broadband • strong demand • extended delivery capacity Interim Report 9 November 2000

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