Telia Company increased its annual dividend by 3.8 percent to SEK 2.45 per share, after meeting its outlook for an increase in full-year cash flow. The company forecast lower cash flow in the coming year on an expected increase in capex.
Operating free cash flow rose 16.2 percent to SEK 12.6 billion in 2019. Even including a SEK 0.4 billion pension benefit in the final quarter, Telia met its guidance for the year. Capex excluding licences and spectrum fees fell by 5.8 percent to SEK 14.1 billion. As warned in Q3, Telia said it does not see room for lowering capex in the near future, and as a result, the company expects the operating free cash flow to fall to around SEK 10.5-11.5 billion in 2020.
Telia posted net revenue up 2.9 percent over the year to SEK 86 billion, and adjusted EBITDA rose 16.9 percent to SEK 31 billion. On a like-for-like basis and excluding the changes in IFRS, adjusted EBITDA was up 4 percent in Q4, as cost reductions in mainly the company's home market Sweden offset a 2.3 percent fall in comparable sales.
The company's net profit more than doubled in 2019 to SEK 7.1 billion, thanks to improved results form associates and lower charges and provisions. In the fourth quarter, the net result improved to a profit of SEK 1.3 billion from a loss of SEK 1.1 billion a year ago.
Adjusted EBITDA excluding currency effects and changes in scope is expected to grow by 2-5 percent this year. Acting CEO Christian Luiga said the company remains focused on cost reductions, with a targeted 2 percent cut in operating expenses in the coming years. This will be supported by the roll-out of its new operating model and synergies from acquisitions as well as a renewed focus on converged offerings.
Telia ended the year 24.2 million subscribers in total, up from 24.0 million in 2018. During the quarter, the total number of subscriptions rose by 0.6 million, driven by TV and Media. The company completed the acquisition of Bonnier Broadcasting in December.
