TeliaSonera January-September 2011

TeliaSonera January-September 2011

Continued margin improvement and strong cash flow

Third quarter

  · Net sales in local currencies and excluding acquisitions increased
2.4 percent. In reported currency, net sales decreased 1.0 percent to
SEK 26,612 million (26,873).
  · The addressable cost base in local currencies and excluding
acquisitions decreased 0.4 percent. In reported currency, the
addressable cost base decreased 3.4 percent to SEK 7,307 million
(7,563).
  · EBITDA, excluding non-recurring items, increased 4.0 percent in
local currencies and excluding acquisitions. In reported currency,
EBITDA, excluding non-recurring items, increased 0.5 percent to SEK
9,802 million (9,756). The EBITDA margin, excluding non-recurring items
improved to 36.8 percent (36.3).
  · Operating income, excluding non-recurring items, decreased 7.0
percent to SEK 7,997 million (8,599) due to lower income from associated
companies.
  · Net income attributable to owners of the parent company decreased to
SEK 4,863 million (5,988) and earnings per share to SEK 1.12 (1.33).
  · Free cash flow increased to SEK 5,106 million (3,857).
  · During the quarter the number of subscriptions grew by 1.3 million
in the consolidated operations and by 3.7 million in the associated
companies. The total number of subscriptions was 164.4 million.
  · Group outlook for 2011 remains unchanged.

Nine-month period

  · Net sales in local currencies and excluding acquisitions increased
2.7 percent. In reported currency, net sales decreased 3.6 percent to
SEK 77,231 million (80,128).
  · Net income attributable to owners of the parent company decreased to
SEK 13,369 million (15,948) and earnings per share decreased to SEK 3.05
(3.55).
  · Free cash flow decreased to SEK 9,106 million (11,159).

Comments by Lars Nyberg, President and CEO
“We are pleased to yet again deliver a strong result and that we,
despite the current macroeconomic uncertainty, continue to deliver
growth. The cost reduction initiatives had effect in the third quarter,
and after four quarters of cost increases we saw a reduction of the
addressable cost base. Our EBITDA margin, excluding non-recurring items,
has now improved twelve consecutive quarters on a rolling 12-month basis
and the margin of 36.8 percent was the highest in a third quarter since
2006.

The demand for our services is greater than ever and the challenge lies
in our ability to monetize on this. After the summer, we launched
several new offers for mobile data to better reflect our customers'
different needs and with a better correlation between usage patterns and
monthly fees. In May, we reduced prices on data roaming within the
Nordic and Baltic countries by as much as 90 percent. Since then, data
roaming volumes have more than doubled. Similar offers will be launched
on more markets over time.

The fiber roll-out is now gaining momentum and we have today 0.5 million
of our 2.5 million broadband customers in the Nordic and Baltic
countries connected by fiber. In addition, we are now also rapidly
upgrading 1 million of our broadband connections over the copper network
with VDSL2 to better support HD-TV, on-demand services and online
gaming.

Growth in Eurasia remained very healthy during the third quarter and
Kazakhstan and Nepal passed 10 million and 6 million subscriptions,
respectively. It is fascinating to witness the appetite for mobile data
also in these countries and we are determined to take the leading
position within data in our footprint. Ncell is already today the
leading internet service provider in Nepal and today 25 percent of
Ucell's revenues come from value added services.

One of the cornerstones in our strategy is to increase the ownership in
our core operations. In some countries, mainly in Eurasia, we have a
relatively low economic ownership although we have full management
control. Therefore, I was very pleased that we in September signed a
Memorandum of Understanding with Kazakhtelecom to increase our ownership
in Kcell in Kazakhstan by 24 percent plus one share in connection with a
planned IPO.

Our first priority in implementing our agreement with Altimo is to
resolve the legal disputes related to Turkcell. Therefore, the recently
announced final award by the International Chamber of Commerce in Geneva
in our favor and the British Virgin Islands court decision in favor of
Altimo are significant steps in the right direction. The Capital Markets
Board's new decree regarding corporate governance principles, stating
that the number of independent board members in Turkcell must be
increased to three, is positive and fully in line with what we have been
trying to achieve for a long time. Increasing the number of independent
members will resolve the deadlock and prevents a minority from blocking
majority decisions.”

Questions regarding the reports:
TeliaSonera AB
Investor Relations
SE-106 63 Stockholm, Sweden
Tel. +46 8 504 550 00
Fax +46 8 611 46 42
www.teliasonera.com (http://www.teliasonera.com/)

TeliaSonera AB discloses the information provided herein pursuant to the
Swedish Securities Markets Act and/or the Swedish Financial Instruments
Trading Act. The information was submitted for publication at 07:15 CET
on October 19, 2011.