TeliaSonera said on the occasion of its 2014 Capital Markets Day that it is replacing its current dividend policy with a target to distribute an annual dividend of at least SEK 3 per share for the fiscal years 2014 and 2015. It said continuous capital expenditure (capex) in its core operations is expected to be around 15 percent of service revenues in the next two years.
TeliaSonera will invest total accumulated capex of up to SEK 6–7 billion in 2015–2016 in two main areas. First, to increase competitiveness and reduce cost, accumulated capex of SEK 2 billion will be spent on business transformation in 2015–2016 to reach net savings with a yearly run rate of SEK 2 billion during 2017.
Second, accumulated capex of up to SEK 4–5 billion will be spent on additional growth initiatives in 2015–2016, primarily accelerating the fibre deployment in Sweden, new B2B offerings, as well as upgrading data networks in Eurasia. In Sweden, the aim is to increase the number of households reached by TeliaSonera’s fibre services from 1.1 million to 1.9 million between 2014 and 2018.
Johan Dennelind, president and CEO of TeliaSonera, said the initiatives aim to defend or increase its market shares and reach sustainable cost savings, without compromising on dividends. The company will continue to target an investment grade long-term credit rating (A- to BBB+). The board of directors’ final dividend proposal will be announced in the 2014 year-end report, which will be released on 29 January 2015.
TeliaSonera reiterated its guidance for the full year. It expects net sales in local currencies, excluding acquisitions and disposals, to be slightly below the level of 2013. Currency fluctuations may have a material impact on reported figures in Swedish kronor. The EBITDA margin, excluding non-recurring items, is expected to be around the same level as in 2013. The capex-to-sales ratio is expected to be approximately 15 percent, excluding licence and spectrum fees.