For Q2 of 2020, the company reported an increase of 2.7% in net sales compared to Q1 of 2020, totalling SEK 21,770 million ($2.4 billion). However, sales were down 5.9% compares to Q2 of 2019.
Adjusted EBITDA rose 3.6% to SEK 7.737 billion ($854 million) from Q1 of 2020, while adjusted EBITDA remained the same for the same period last year.
Service revenues increased by 4.7% to SEK 19.129 billion ($2.1 billion) from Q1 2020 and declined 5.6% compared to Q2 2019.
Unsurprisingly, Covid-19 played a part in service revenue declines with an estimated SEK 1 billion ($110 million) impact, driven by lower roaming, pay-TV and advertising revenues. At the same time, Covid also had an SEK 0.5 billion ($55.2 million) impact on adjusted EBITDA.
Additionally, operational free cash flow fell to SEK 2.202 billion ($243 million) and cash flow from operating activities fell to SEK 6.267 billion ($692 million) for the quarter.
“Our second quarter results were better than our expectations, as a result of proactively addressing our cost base, but still clearly impacted by the Covid-19 pandemic. Service revenues declined on a like for like basis by 5.6%, with our traditional telecom revenues stable, if you exclude the impact from Covid-19,” said Allison Kirkby (pictured), president and CEO of Telia Company.
“Despite the service revenue challenges adjusted EBITDA was flat, as we worked hard to mitigate the negative Covid-19 impacts (around SEK 0.5 billion in total in the second quarter). Having made the first payment for the acquired Champions League rights for the 2021-2024 period combined with additional weaker working capital our operational free cash flow fell to SEK 2.2 billion, from SEK 2.4 billion in the second quarter of 2019.”
The first half outlook showed net sales increased 5.2% to SEK 44.197 billion ($4.8 billion), down 4% compared to the first half of 2019.
Adjusted operating income fell 15.4% to SEK 5.608 billion ($619 million), while total net income fell to SEK -883 million (-$97 million) mainly due to the decision to divest ownership of Turkcell Holding for SEK -3.488 billion ($385 million).
