Year-end Report January-December 2013

Stable finish to a challenging year
Fourth quarter summary

  · Net sales in local currencies, excluding acquisitions and disposals,
decreased 0.2 percent. In reported currency, net sales decreased 2.1 percent to
SEK 26,503 million (27,069).
  · The addressable cost base in local currencies, excluding acquisitions and
disposals, increased 2.8 percent. In reported currency, the addressable cost
base increased 1.0 percent to SEK 7,466 million (7,394).
  · EBITDA, excluding non-recurring items, increased 0.1 percent in local
currencies, excluding acquisitions and disposals. In reported currency, EBITDA,
excluding non-recurring items, decreased 3.0 percent to SEK 8,728 million
(9,002). The EBITDA margin, excluding non-recurring items, decreased to 32.9
percent (33.3).
  · Operating income, excluding non-recurring items, decreased 7.0 percent to
SEK 7,100 million (7,636). Operating income decreased to SEK 4,560 million
(7,826).
  · Net income attributable to owners of the parent company decreased 68.2
percent to SEK 2,190 million (6,880). Earnings per share decreased to SEK 0.51
(1.59).
  · Free cash flow was SEK 2,126 million (2,934).

Full year summary

  · Net sales in local currencies, excluding acquisitions and disposals,
decreased 0.2 percent. In reported currency, net sales decreased 3.0 percent to
SEK 101,700 million (104,898).
  · Net income attributable to owners of the parent company decreased 24.7
percent to SEK 14,970 million (19,886) and earnings per share decreased to SEK
3.46 (4.59).
  · Free cash flow was SEK 16,310 million (23,740). Free cash flow excluding
dividends from MegaFon was SEK 14,370 million (12,014).
  · The Board of Directors proposes an ordinary dividend of SEK 3.00 per share
(2.85), totaling SEK 13.0 billion (12.3) or 87 percent (62) of net income
attributable to owners of the parent company.


Comments by Johan Dennelind,
President and CEO

“It is clear that 2013 was an eventful and challenging year for TeliaSonera and
the telecoms industry. Overall performance was impacted by modest economic
growth, regulatory effects and rapidly changing customer behavior. In this
environment, we are pleased to close the year with virtually flat organic
revenues, a slight increase in our EBITDA margin, excluding non-recurring items,
to 35.0 percent and solid free cash flow of SEK 16.3 billion.

In the fourth quarter, organic revenues stayed more or less unchanged year over
year, while the EBITDA margin declined marginally. We continued to develop our
data centric pricing models and invested further in network coverage and quality
across our footprint. In addition, we secured crucial mobile spectrum in Finland
and Norway. In Sweden, performance in the consumer segment was encouraging, with
good demand for fiber within Broadband Services and positive contribution to
billed revenue growth in Mobility Services. However, overall performance was
adversely impacted by challenges in the enterprise area. In Finland, revenue
pressure eased and profitability improved despite a difficult macroeconomic
environment. Our Eurasian operations delivered another quarter with strong
profitability, which is reassuring as we continue to form the business for the
future.

Since I assumed responsibility in September, a key task has been to develop the
strategic roadmap for TeliaSonera’s journey ahead. An important step in this
process was taken in December when we finalized our new operating model, a
country based structure that will be launched on April 1, 2014. The aim with
this change is to reduce overall complexity within the group, enhance customer
focus and clarify general accountability.

Together with increased focus from group functions, the new structure will
facilitate one common agenda across the company. We need to improve our
competitive position going forward, particularly within the enterprise area, and
expect to deliver further updates on this process and give more color to our
overall journey ahead during the course of 2014.

Creating a sustainable business is a key part of our strategic initiatives and
significant measures have been taken in order to strengthen corporate
governance. The roll-out of our code of ethics and conduct training continues,
with focus on anti-corruption. The board has adopted a new freedom of expression
policy in Telecommunications, which will be a vital tool for us when we deal
with these issues in the markets where we operate. We monitor the progress
through our newly established GREC (Governance, Risk, Ethics and Compliance)
Committee, where the entire Group Management is present.

As a result of our strong cash flow generation and solid financial position, the
board proposes a dividend of SEK 3.00 for 2013, an increase by 5.3 percent,
corresponding to a pay-out ratio of EPS of 87 percent.”


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


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 07:00 CET on January 30, 2014.