Elisa - Interim report (Q1 and Q3)

Elisa's Interim Report January–June 2015

ELISA INTERIM REPORT RELEASE 16 JULY 2015 AT 8:30 AM

Second quarter 2015

  -- Revenue amounted to EUR 390 million (384)
  -- EBITDA was EUR 131 million (127) and EBIT was EUR 79 million (73)
  -- Profit before taxes amounted to EUR 74 million (67) 
  -- Earnings per share were EUR 0.38 (0.35)
  -- Cash flow after investments was EUR 70 million (64)

  -- Mobile ARPU grew to EUR 15.7 (15.3 in previous quarter)
  -- Mobile churn decreased to 14.4 per cent (17.7 in previous quarter)
  -- The number of Elisa's mobile subscriptions increased by 25,200 during the
     quarter
  -- The number of fixed broadband subscriptions decreased by 5,500 on the
     previous quarter
  -- Net debt / EBITDA was 2.0 (1.9 end 2014) and gearing 136 per cent (114 end
     2014)

January-June 2015

  -- Revenue was EUR 771 million (766)
  -- EBITDA was EUR 260 million (253), EBIT EUR 155 million (145)
  -- Earnings per share grew to EUR 0.75 (0.67)
  -- Cash flow after investments was EUR 138 million (103)

Key indicators

--------------------------------------------------
                         2nd Quarter  Year-to-date
EUR million               2015  2014   2015   2014
--------------------------------------------------
--------------------------------------------------
Revenue                    390   384    771    766
EBITDA                     131   127    260    253
EBIT                        79    73    155    145
Profit before tax           74    67    145    131
Earnings per share, EUR   0,38  0.35   0,75   0.67
Capital expenditure         49    52    100    101
--------------------------------------------------


Financial position and cash flow

EUR million           30.6.2015  30.6.2014  End 2014
----------------------------------------------------
----------------------------------------------------
Net debt                  1,075      1,075     1,001
Net debt / EBITDA 1)        2.0        2.1       1.9
Gearing ratio, %          135.8      140.7     114.0
Equity ratio, %            35.1       34.4      39.4
----------------------------------------------------



------------------------------------------------------
                             2nd Quarter  Year-to-date
EUR million                   2015  2014   2015   2014
------------------------------------------------------
Cash flow after investments     70    64    138    103
------------------------------------------------------

1) (interest-bearing debt - financial assets) / (four previous quarters' EBITDA
exclusive of non-recurring items) 

Additional information regarding the Key Performance Indicators is available
at: www.elisa.com/investors (Elisa Operational Data.xls) 


CEO Veli-Matti Mattila: Mobile services yielding strong earnings

The challenging general economic situation has remained unchanged.
Nevertheless, we were able to strengthen Elisa's competitiveness further. In
the second quarter of the year, our revenue and earnings grew year-on-year. The
growth in earnings was boosted by the increasing demand for mobile data and the
improvement of the profitability of operations. 

During the quarter, the number of mobile subscriptions increased by more than
25,000, while the number of fixed network broadband subscriptions fell by
5,500. The demand for 4G sub-scriptions grew strongly, and customers are ready
to pay more for the use of faster data speeds. Elisa's determined construction
of the 4G network has progressed at record speed and Elisa has already
fulfilled the terms and conditions set for its licence in connection with the
800 MHz auction well in advance of the time limit of 2019. 97 per cent of Finns
live within the reach of the 4G network with the broadest coverage in Finland,
and it extends to over 290 localities. Fast Internet connections have been
constructed using new frequencies in sparsely populated areas, in particular. 

The content of Elisa Viihde was enhanced with both entertainment and sports
content. As a continuation to our significant and long-term investments in
domestic films, we will produce the first original series in the history of
Elisa Viihde. Finnish front-line actors will star in the extensive drama
production named Downshiftaajat. Netflix is now for the first time part of the
IPTV service, integrated into Elisa Viihde. Beginning next autumn, we will show
all European Championship and World Championship football qualification games
played in Europe. 

We launched a new Elisa Kassa service for companies, which enables trading
without heavy cash systems. It makes it possible to introduce efficient product
and inventory management. In a groundbreaking experiment, self-measured data is
becoming part of health care services. In an internationally advanced
experiment, we have adopted digital meters producing information that is
integrated more closely into health care services and systems for utilisation.
We established a unique test laboratory in Finland, where it is possible to
test apps in a genuine mobile phone network already before their launch. 

We take corporate responsibility into account in all our business operations.
In addition, we invest in important social projects. Together with Nokia, we
donated a turnkey mobile phone network providing full internal facility
coverage to the New Children's Hospital to be completed in 2017. The latest
technology is used in the construction of the network, which will also enable
the use of services of the future. 

We will continue our determined work to improve both customer satisfaction and
our opera-tional productivity. Improving our productivity, developing new
services for our customers, and maintaining our strong investment ability
create a solid foundation for competitive operations in the future. 

Outlook and guidance for 2015

The macroeconomic environment in Finland is still expected to be weak in 2015.
Competition in the Finnish telecommunications market also remains challenging. 

Full-year revenue is estimated to be at the same level as in 2014. Mobile data,
ICT and new online services are expected to increase revenue. Full-year EBITDA,
excluding non-recurring items, is anticipated to be at the same level as in
2014. Full-year capital expenditure is expected to be a maximum of 12 per cent
of revenue. Elisa's financial position and liquidity are good. 

Elisa is continuing its productivity improvement measures, for example by
streamlining the product portfolio and IT systems and operations. Additionally,
Elisa is continuing to increase customer service and sales efficiency, as well
as to reduce general administrative costs. 

Elisa's transformation into a provider of exciting, new and relevant services
for its customers is continuing. Long-term growth and profitability improvement
will derive from mobile data market growth, as well as new online and ICT
services. 

Disclosure procedure

Elisa is adopting the disclosure procedure enabled by the Standard 5.2b
published by the Finnish Financial Supervision Authority. This is a summary of
Elisa's Q2 2015 Interim Report and the complete report is attached as a
pdf-file to this release and is also available on our website at
www.elisa.com/investors. 


ELISA CORPORATION

Additional information:

Mr. Veli-Matti Mattila, CEO, tel. +358 10 262 2635
Mr. Jari Kinnunen, CFO, tel. +358 10 262 9510
Mr. Vesa Sahivirta, IR Director, tel. +358 10 262 3036

Distribution:

Nasdaq Helsinki
Principal media
www.elisa.com

Attachments:

INTERIM REPORT Q2 2015.pdf