TEO LT, AB - Interim information

Results for the twelve months of 2013

On 28 January 2014, the Board of TEO LT, AB (hereinafter - “TEO” or “the
Company”) approved unaudited TEO LT, AB Consolidated Interim Financial
Statements, prepared according to International Financial Reporting Standards
as adopted by the European Union, for the twelve months period ended 31
December 2013. 

The total consolidated TEO Group's revenue for the fourth quarter of 2013 was
LTL 179 million (EUR 51.8 million), an decrease by 1.4 per cent over the total
revenue of LTL 181 million (EUR 52.5 million) for the third quarter of 2013 and
by 5.7 per cent over the total revenue of LTL 190 million (EUR 54.9 million)
for the fourth quarter of 2012. The total revenue for the twelve months of 2013
was LTL 721 million (EUR 208.7 million), a decrease by 5.2 per cent over the
total revenue of LTL 760 million (EUR 220.2 million) for the twelve months of
2012. 

EBITDA for the twelve months of 2013 decreased by 4.7 per cent to LTL 293
million (EUR 84.8 million) over LTL 307 million (EUR 88.9 million) for the same
period year ago. EBITDA margin amounted to 40.6 per cent (40.4 per cent in
2012). EBITDA for October-December of 2013 went down by 8.1 per cent to LTL 65
million (EUR 18.9 million) over LTL 71 million (EUR 20.5 million) in
October-December of 2012. EBITDA margin amounted to 36.4 per cent (37.4 per
cent in 2012). 

Profit before income tax for the twelve months of 2013 went down by 6.6 per
cent and amounted to LTL 166 million (EUR 48 million) (LTL 177 million (EUR51.4 million) a year ago). Profit before income tax for the fourth quarter of
2013 was down by 9.8 per cent and amounted to LTL 34 million (EUR 9.9 million)
(LTL 38 million (EUR 11 million) a year ago). 

Profit for the period in January-December 2013 amounted to LTL 149 million (EUR
43.2 million), a decrease by 6.2 per cent over the profit of LTL 159 million
(EUR 43.1 million) for the same period year ago. The profit margin was 20.7 per
cent (20.9 per cent a year ago). Profit for the period in October-December 2013
amounted to LTL 31 million (EUR 9 million), while a year ago it was LTL 36
million (EUR 10.3 million), an decrease by 12.9 per cent. The profit margin was
17.3 per cent (18.7 per cent a year ago). 



Management's comment on financial results for the twelve months period of 2013:

“TEO revenue stream during the fourth quarter of 2013 decreased by 1.4 per cent
to LTL 179 million (EUR 51.8 million), compared to the third quarter of 2013
(an increase by 0.9 per cent excluding one-time projects). The decrease was
mostly driven by the decrease in revenue from voice telephony services. The
Company's revenue excluding voice telephony services increased by 0.6 per cent
compared to the previous quarter (an increase by 3.9 per cent, y-o-y) mostly
driven by increase in revenue from Internet and TV services. 

In a declining Lithuanian telecommunications market (during the third quarter
of 2013 it fell by 6.6 per cent, y-o-y) TEO revenue for the twelve months of
2013 decreased by 5.2 per cent compared to 2012 due to decrease in revenue from
international business. Revenue from within the country provided voice
telephony services decline in absolute terms by LTL 22 million (EUR 6.4
million) (in 2012 by LTL 23 million (EUR 6.7 million)). However strong cost
control allowed the Company to reach record high for the last four years EBITDA
margin of 40.6 per cent. In 2013, revenue excluding voice telephony services
continued to grow from quarter to quarter. Most of this increase was coming
from IPTV (grew by 17.9 per cent) and Internet services (3.7 per cent). 

The Company‘s free cash flow stood at LTL 144 million (EUR 41.7 million) and
free cash flow to sales ratio was 20 per cent - just slightly less than that in
2012, when it amounted to 23 per cent. 

During 2013 TEO reached several milestones: its Internet customers' base
exceeded 430 thousand and TV customers' base exceeded 170 thousand. The Company
continued to fulfil its commitment to the customers by further expanding its
next generation fiber-optic network. Thus, in 2013 the number of customers
using modern fiber-optic network exceeded the number of customers using copper
technologies. At the same time TEO has increased Internet speeds by 100 per
cent for most of its DSL technology customers. 

During the year TEO introduced “My package” service, that allows to select only
those TV channels which are relevant for the customer, possibility to purchase
equipment - from TV sets to laptops and tablets, Internet security solutions
for businesses and individual customers. The Company also completed Wi-Fi for
Schools project providing access to Internet possibility to 450 schools in
Lithuania. It also created a new generation Internet TV service for smart
devices - "Internet.tv". This service marks new stage in the development of
television allowing to watch TV on a PC, smartphone or tablet anywhere in
Lithuania wherever Internet connection (including Wi-Fi or 3G) is available.” 



ENCL.:

  -- TEO LT, AB Consolidated Interim Financial Statements for the twelve months
     period ended 31 December 2013.
  -- Presentation of TEO LT, AB results for the twelve months of 2013.






         Darius Džiaugys,
         Head of Investor Relations,
         tel. +370 5 236 7878

Attachments:

2013_12_months_report.pdf

2013_12_months_results.pdf