Elisa - Interim report (Q1 and Q3)

Elisa’s Interim Report January-June 2013

ELISA INTERIM REPORT RELEASE 12 JULY 2013 AT 8:30am

Second quarter 2013
- PPO companies consolidated as of 1 May 2013
- Revenue amounted to EUR 390 million (389)
- EBITDA was EUR 122 million (122) and EBIT was EUR 69 million (72)
- Profit before tax was EUR 63 million (66)
- Earnings per share was EUR 0.30 (0.32)
- Cash flow after investments was EUR -30 million (47), excluding PPO
acquisition EUR 54 million 

- Mobile ARPU was EUR 16.2 (15.4 in previous quarter)
- Mobile churn was 17.7 per cent (20.0 in previous quarter)
- The number of Elisa's mobile subscriptions increased by 19,700 during the
quarter 
- The number of fixed broadband subscriptions increased by 58,300 on the
previous quarter 
- Net debt / EBITDA was 2.1 (1.7 end 2012) and gearing 137 per cent (99 end
2012) 

January - June 2013
- Revenue was EUR 751 million (771)
- EBITDA was EUR 231 million (243), EBIT EUR 128 million (140)
- Cash flow after investments was EUR 7 million (85), excluding acquisitions
EUR 95 million 

Key indicators:

--------------------------------------------------
                         2nd Quarter  Year-to-date
EUR million               2013  2012   2013   2012
--------------------------------------------------
--------------------------------------------------
Revenue                    390   389    751    771
EBITDA                     122   122    231    243
EBIT                        69    72    128    140
Profit before tax           63    66    117    127
Earnings per share, EUR   0.30  0.32   0.56   0.63
Capital expenditures        47    51     94     92
--------------------------------------------------



Financial position and cash flow:

EUR million          30.6.2013  30.6.2012  End 2012
---------------------------------------------------
---------------------------------------------------
Net debt                 1,042        909       839
Net debt / EBITDA1)        2.1        1.8       1.7
Gearing ratio, %         136.6      123.6      99.3
Equity ratio, %           35.5       38.0      42.3
---------------------------------------------------



------------------------------------------------------
                             2nd Quarter  Year-to-date
EUR million                   2013  2012   2013   2012
------------------------------------------------------
Cash flow after investments    -30    47      7     85
------------------------------------------------------

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:

“Elisa's result at last year's level

Elisa's result and revenue continued at the same level even though the
competitive situation remained intense during the second quarter of the year.
Insecurity regarding the general economic situation was reflected in the
cautiousness of companies and consumers. However, the demand for new services
continued strong. Revenue was negatively affected by the drop in the
interconnection fees. Revenue was positively affected by the acquisition of
PPO's business operations and the abatement of the most aggressive price
campaigns, which occurred at the turn of the year. 

Our mobile subscription base grew by 19,700 during the second quarter of the
year. The number of fixed network broadband subscriptions increased by more
than 58,300 with the acquisition of PPO. The use of smartphones and USB modems
further increased the growth in mobile data services among both consumers and
corporate customers. 

A number of new service features were developed for consumers. It will now be
possible to watch HBO's quality TV series via the Elisa Viihde service
immediately after the show premieres in the United States. New payment methods
are now incorporated in Elisa Lompakko, the first mobile payment service in the
Nordic Countries. For example, it will be possible to use Elisa Rahaviesti to
send payments to all mobile phone numbers in the future, which will facilitate
the transfer and repayment of small amounts. In addition, we launched an
extension to our data security service for consumers. In the future, consumers
will be able to do secure online banking not only on the computer but also with
any mobile device. 

Corporate customers' interest in ICT services increased in both the public and
private sectors. A recent study shows that municipalities have significant
needs for reform in service solutions and the renewal of the tools of mobile
personnel, to which Elisa's services can respond. 

In the first quarter of the year, we began new measures to improve
profitability in this challenging environment. Our measures with regard to the
areas in question, such as streamlining product selections and IT systems,
enhancing the efficiency of customer service and sales, and cutting
administrative costs, will accelerate further in the second half of the year. 

We have further refined our strategy. Our focus areas are to bring added value
to customers through the use of data, accelerate new service businesses, and
improve performance through increased customer understanding, quality, and
cost-efficiency. Improving our productivity, developing new services for our
customers, and maintaining our strong investment capabilities provide a solid
foundation for competitive operations in the future."

Outlook for 2013

The macroeconomic environment in Finland is still expected to be weak in 2013.
Competition in the Finnish telecommunications market also remains challenging. 

Full year revenue is estimated to be at the same level or slightly higher than
in the previous year. Mobile data, ICT and new online services as well as
completed acquisitions are expected to increase revenue. Full year EBITDA,
excluding non-recurring items, is anticipated to be at the same level as in
2012. As a result of the PPO consolidation, full-year capital expenditure is
expected to be approximately 13 per cent of revenue. The mid-term target of
maximum 12 per cent is still valid. Elisa's financial position and liquidity
are good. 

In order to secure good results in a more challenging environment, Elisa is
continuing its accelerated cost efficiency measures, in the areas of
streamlining product portfolio and IT systems, increasing  customer service and
sales efficiency, as well as reducing  general administration costs. 

Elisa's transformation into a provider of new, exciting and relevant services
for its customers continues. 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 2013 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 OMX Helsinki
Principal media
www.elisa.com

Attachments:

130712INTERIM REPORT Q2 2013.pdf