Telia Shows Stable Performance in the Fourth Quarter; Sells Towers in Sweden for SEK 11.2 Billion

During the fourth quarter Telia continued the positive trend in organic growth during past quarters, with service revenue up 2.9% year over year, aided by all divisions bar Finland, which continued the declining trend over the last few quarters due to its higher exposure to the enterprise business, which is seeing revenue pressure in IT and mobile. Sweden, Telia’s largest segment, managed to grow service revenue 1.5% organically, with slight price increases in mobile and broadband, and a stable customer base. Overall, revenue growth did not translate into higher EBITDA despite a 3.6% reduction in operating expenses, as the TV and media division saw a decline in profits driven by higher content costs. We are maintaining our SEK 40 fair value estimate.