TDC (TDC.CO, TDC DC), a leading communication and entertainment company in Denmark and Norway, announces its financial statements for 2017:
Pernille Erenbjerg, Group CEO, TDC A/S, says:
“As we embark on the final year of our current strategy period set out in early 2016, we can look back on 2017 and the benefits we have begun to reap from the significant changes we have instigated. We delivered on all parameters in our guidance with growth in our mobile business and positive impact from our Digital First programme. On EBITDA, we delivered almost stable organic development and cash flows returned to growth in 2017 up by 17.4% to DKK 2.4bn.”
“With our financial guidance for 2018, we reach an important milestone in our transformation, as we expect to deliver flat to slightly growing organic EBITDA, stable to growing cash flows, and a 10% growth in dividends, up to DKK 1.15 per share for 2018.”
2017 FY performance
· Financial performance as guided; EBITDA (DKK 8,244m. Guidance >DKK 8,200m) and very strong EFCF (DKK 2,445m
or +17.4%. Guidance: Stable or moderate growth)
· EBITDA growth in Norway (5.0% YoY) driven by Get. When adjusting for one-offs in 2016 and 2017 Norway EBITDA
increased by 1.6% YoY
· Profit for the year decreased by DKK 1.5bn, primarily due to the gain in 2016 from the divestment of TDC Sweden
(DKK 1.0bn)
· High group organic opex savings of 5.5% or DKK 394m in 2017 driven by execution of strategic initiatives and organic
FTE reductions of 6.7%
· Strategy execution is progressing very well: we maintained position as best mobile network in Denmark, increased IP
enablement of TV bases in Denmark, introduced new TV offering in Get, launched a converged offering “YouSee More”
in YouSee, and promoted our Digital First programme simplifying the customer journey and our ways of working in a
new and dedicated business line
· Improvements in both positive and negative customer experiences vs. 2016 driven by focus on availability and quality;
Telmore and Get both won awards for the best customer service.
2018 guidance
· Organic EBITDA development: ≥0% (corresponding to reported DKK ~8.2bn assuming NOK/DKK exchange rate of 0.77)
· EFCF: DKK ≥2.4bn
· DPS: DKK 1.15 per share to be paid out in Q1 2019
Q4 2017 performance
· Organic EBITDA decline of 1.3% and reported EBITDA decline of 4.8% in Q4 YoY
· Increase of 22.8% in EFCF in Q4 YoY driven primarily by reduced interest payments, net working capital and cash flow
capex partly offset by lower EBITDA
· Significant organic improvement in operating expenses of 8.7% or DKK 160m in Q4 YoY
· EBITDA decrease of 18.8% in Business in Q4 YoY, which is worse than the YTD trend mainly due to different timing
between Q3 2017 and Q4 2017
· Mobile voice ARPU increase of DKK 7 or 6% in Consumer YoY; mobile voice customer base increased by 4k in Consumer
and Business vs. Q3
· Loss of 17k TV customers in Denmark in Q4 in line with market development and an improvement vs. previous quarters
· Calls to Support & Billing reduced by 22.0% YoY and 9.7% compared with Q3; Insourcing of YouSee support call centre
with increase of ~800 FTEs as of 1 December; the full customer service value chain is now anchored in TDC Group to
make it simpler and better to be a customer
· ~40k households have already signed up for our converged offering ‘YouSee More’ and expecting to reach >300k in 2018
| TDC Group, key figures¹ | ||||||||
| Q4 2017 | Q4 2016 | Change in % | 2017 | 2016 | Change in % | |||
| Income statements | DKKm | |||||||
| Revenue | 5,046 | 5,415 | (6.8) | 20,270 | 21,031 | (3.6) | ||
| Gross profit | 3,630 | 3,893 | (6.8) | 14,969 | 15,627 | (4.2) | ||
| EBITDA | 1,959 | 2,058 | (4.8) | 8,244 | 8,488 | (2.9) | ||
| Organic revenue² | (4.4) | (2.6) | ||||||
| Organic gross profit² | (4.8) | (3.0) | ||||||
| Organic EBITDA² | (1.3) | (0.8) | ||||||
| Profit for the period from continuing operations excluding special items | 217 | 129 | 68.2 | 1,698 | 2,182 | (22.2) | ||
| Profit for the period | 88 | 1,075 | (91.8) | 1,553 | 3,037 | (48.9) | ||
| Total comprehensive income | 324 | 1,829 | (82.3) | 1,828 | 3,928 | (53.5) | ||
| Capital expenditure | (1,396) | (1,388) | (0.6) | (4,488) | (4,352) | (3.1) | ||
| Equity free cash flow (EFCF) | 511 | 416 | 22.8 | 2,445 | 2,082 | 17.4 | ||
| Key financial ratios | ||||||||
| Earnings Per Share (EPS) | DKK | 0.11 | 1.34 | (91.8) | 1.73 | 3.58 | (51.7) | |
| Adjusted EPS | DKK | 0.38 | 0.33 | 15.2 | 2.56 | 3.27 | (21.7) | |
| Gross margin | % | 71.9 | 71.9 | - | 73.8 | 74.3 | - | |
| EBITDA margin | % | 38.8 | 38.0 | - | 40.7 | 40.4 | - | |
| Customer satisfaction | ||||||||
| Recommend score | YTD avg. index | 64 | 64 | - | 64 | 64 | - | |
| ¹ For additional data, see TDC Fact Sheet on www.tdcgroup.com/en/investor-relations/financial-reports. | ||||||||
| ² Adjusted for the impact from foreign exchange rates, regulatory price adjustments as well as acquisitions and divestments. | ||||||||
The Annual Report 2017 is available for download at https://tdcgroup.com/en/investor-relations/financial-reports:
· Annual Report 2017
· Online Report 2017 — Financial, operational and strategic highlights; This Report is also directly available at http://annualreport2017.tdcgroup.com/
In addition, the TDC Group’s CSR Report 2017 is available at http://csrreport2017.tdcgroup.com/ This report is also accessible via the Online Report 2017.
Conference call details
A conference call will be held on 1 February 2018 at 14:00 CET.
Presentation material will be available prior to the conference call on www.tdcgroup.com
Dial-in details can be found at:
http://event.onlineseminarsolutions.com/r.htm?e=1593011&s=1&k=F75CC6E270DCD50569C0C19A944100B0
Audio cast: https://edge.media-server.com/m6/p/ewfpwyv7
For investor enquiries: +45 66 63 76 80
For media enquiries: +45 70 20 35 10
TDC A/S
Teglholmsgade 1
0900 Copenhagen C
DK-Denmark
tdc.com
