Telenor Second Quarter 2007: Continued good performance

Tuesday, July 24th, 2007 
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Reported figures:
“¢ Revenue growth of 5% – underlying growth of 12%
“¢ EBITDA margin of 32%
“¢ Earnings per share of NOK 1.94

Proforma figures including Kyivstar estimates:
“¢ Revenue growth of 19% – underlying growth of 13%
“¢ EBITDA margin of 35%
“¢ Earnings per share of NOK 2.24

Fornebu — In the second quarter of 2007, Telenor’s pro forma revenues increased by 19 per cent compared to the second quarter of 2006, reaching NOK 26.2 billion. The underlying pro forma revenue growth was 13 per cent. Pro forma EBITDA was NOK 9.1 billion. The pro forma figures include estimates for Kyivstar.

BROADCAST

In the second quarter of 2007, revenues in Broadcast increased by 13.6 per cent compared to the second quarter of 2006, reaching NOK 1,776 million. EBITDA was NOK 462 million, a 5.7 per cent increase from the second quarter of 2006.

  2nd quarter 1st half year Year
(NOK in millions)   2007   2006   2007   2006   2006
Revenues
Canal Digital Group 1 442 1 299 2 838 2 550 5 197
Transmission & Encryption 455 317 882 629 1 280
Other/Eliminations (121) (52) (244) (98) (168)
Total revenues 1 776 1 564 3 476 3 081 6 309

EBITDA
Canal Digital Group 234 251 404 485 810
Transmission & Encryption 240 191 460 366 748
Other/Eliminations (12) (5) (27) (6) 32
Total EBITDA 462 437 837 845 1590

Operating profit
Canal Digital Group 178 189 293 361 563
Transmission & Encryption 147 110 274 199 413
Other/Eliminations (16) (15) (35) (25) (10)
Total operating profit 309 284 532 535 966

EBITDA/Total revenues (%) 26.0 27.9 24.1 27.4 25.2
Capex 359 106 617 198 615
Investments in businesses 98 98 219

No. of subscribers – Change in quarter/Total (in thousands):
DTH pay TV (10) 3 934 921 943
Cable TV (3) 3 697 687 696
Households in satellite
master antenna TV networks
(2) (1) 1 161 1 119 1 155
Cable TV Internet access 8 3 108 81 91

Conditional access systems, previously included in Other/Eliminations, are now included in Transmission & Encryption.
“¢ Revenues in the Canal Digital Group increased primarily due to higher number of subscribers and higher number of additional services. The decrease in EBITDA and EBITDA margin was mainly related to higher content and CRM related costs, partially offset by lower subscriber acquisition costs.
“¢ Revenues and EBITDA in Transmission & Encryption increased due to higher sales of conditional access cards related to pay TV.
“¢ Increased capital expenditure was related to the construction of the Norwegian digital terrestrial TV network (DTT) and upgrade of the Norwegian cable TV network.

Revenues

Canal Digital Group
“¢ consist of revenues from pay TV subscribers and basic tier households on DTH (direct to home), cable TV subscribers, households in SMATV networks and DTT (Digital terrestrial TV) pay TV subscribers.
Transmission & Encryption
“¢ consist of revenues from satellite services from satellite position 1-degree west, and revenues from terrestrial radio and TV transmission in Norway and revenues from conditional access systems.
Other
“¢ consist of revenues not directly related to the Canal Digital Group and Transmission & Encryption.