Telia Company announced preliminary annual results showing cash flow exceeded its outlook. As a result, the company is raising its dividend to SEK 2.00 per share from SEK 1.80 last year. The company said it would also take a non-cash impairment charge of SEK 7.8 billion for its Finnish operators in the Q4 2020 results.
The full figures will not be released until 29 January, but Telia expects operational cash flow of SEK 12.1 billion for the year, better than its outlook of the upper end of the guidance range of SEK 9.5-10.5 billion. The improved cash flow prompted the increase in the dividend, and the new amount of SEK 2 per share will be the floor for the years ahead, Telia said.
Telia said adjusted EBITDA for Q4 was "broadly in line" with its outlook given at the Q3 report for a full-year figure of around SEK 30.5 billion. The strong cash flow performance was mainly linked to working capital, with greater benefits accruing in 2020 than anticipated, the company said.
The impairment charge follows the annual review of the carrying value of various assets in the business. While the analysis in 2018 and 2019 showed that the recoverable amount for Finland was very close to the carrying value, the pandemic, a slightly weaker underlying performance as well as increased network investments versus the original business plan resulted in the need for a writedown this year.
