TeliaSonera Interim Report January – March 2015

Progress and challenges

FIRST QUARTER SUMMARY

  · Net sales in local currencies, excluding acquisitions and disposals,
increased 1.5 percent. In reported currency, net sales increased 8.8 percent to
SEK 26,041 million (23,926). Service revenues in local currencies, excluding
acquisitions and disposals, decreased 1.1 percent.
  · EBITDA, excluding non-recurring items decreased 4.3 percent in local
currencies, excluding acquisitions and disposals. In reported currency, EBITDA,
excluding non-recurring items, increased 2.3 percent to SEK 8,540 million
(8,345). The EBITDA margin, excluding non-recurring items, decreased to 32.8
percent (34.9).
  · Operating income, excluding non-recurring items, decreased 12.6 percent to
SEK 5,496 million (6,286).
  · Net income attributable to owners of the parent company decreased 5.9
percent to SEK 3,714 million (3,945) and earnings per share to SEK 0.86 (0.91).
  · Free cash flow increased to SEK 2,853 million (2,556) despite higher cash
CAPEX, supported by lower taxes and working capital changes.
  · Group outlook for 2015 is unchanged.


Comments by Johan Dennelind,
President and CEO

”The first quarter was eventful and I am particularly satisfied that we reached
two milestones by closing the Tele2 Norway acquisition and in achieving an
agreement on dividend distribution in Turkcell.

Our strategic agenda remains firm and we have started to execute on our
investment plans to improve the internet experience for our customers and
structurally reduce the cost base. We are taking further steps into areas close
to the core and recently launched new cloud based services for small and mid
-sized enterprises.

In Sweden, mobile service revenue growth remained healthy at 2 percent, fuelled
by solid demand for data in the consumer segment. Competitor activity
intensified at the beginning of the year when more generous data bundles were
introduced in the market. We continue to expand our 4G and fiber networks and
will further utilize this strength in our customer offerings going forward.
Demand for our fiber services remains strong and we are on track to reach our
target for 2015 to increase the number of new connections to single-homes by 25
percent. Profitability slowed in the quarter, mainly due to market investments
and changed product mix, but we expect performance to improve during the course
of the year.

Our Finnish business holds up well in the market, but costs increased related to
our focus on enhancing customer experience. In February, we finalized the
acquisition of Tele2 Norway and the business combination will both strengthen
our position in the market and enhance our proposition to the Norwegian
customers. The nearly one million acquired subscriptions have now been migrated
to our network and we remain confident reaching our synergy target in 2016. In
Denmark, the regulatory approval process of our joint venture with Telenor
continues as expected and we anticipate closing in the second half of 2015.

The macroeconomic and competitive picture in parts of Eurasia remained demanding
and we have put a lot of effort into re-positioning our offerings in order to
make us more attractive for the customers. Our operation in Nepal showed once
again strong performance, while we need to further strengthen our
competitiveness in Kazakhstan. Overall, organic service revenue growth turned
slightly positive and profitability remained high, but the challenging
environment is expected to remain near term.

After nearly five years with a deadlock between the main owners of Turkcell, we
reached an agreement in March on a dividend distribution proposal for the years
2010-2014. This was recently approved by Turkcell’s General Assembly Meeting and
TeliaSonera’s share amounts to approximately SEK 4.5 billion after tax. The
resolution was an important step in achieving ordinary corporate governance of
Turkcell and we will continue the dialogue with all relevant stakeholders.

As expected, the start of the year has been somewhat slow, but we foresee a
gradual improvement in the earnings trend and reiterate our full year outlook.
We anticipate EBITDA, on a local organic basis, to remain around last year’s
level and foresee CAPEX at around SEK 17 billion, excluding license and spectrum
fees.”

Stockholm, April 21, 2015

Johan Dennelind
President and CEO

Questions regarding the reports
TeliaSonera AB
www.teliasonera.com/investors
Tel. +46 8 504 550 00


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 April 21, 2015.