By Supantha Mukherjee
STOCKHOLM (Reuters) -Nordic telecoms operator Telia gave an upbeat growth forecast on Friday as it reported better than expected quarterly core earnings, helped by growth in service revenue in markets such as Sweden and the Baltics.
The company forecast service revenue and earnings before interest, tax, depreciation and amortisation (EBITDA) to grow in a low single-digit percentages in 2022.
While the telecoms business is expected to grow by low to mid-single digits, EBITDA from TV and Media will be lower than in 2021 owing to increased investment in content and premium sports rights.
Chief Executive Allison Kirkby said Telia is looking to continue the strategy laid out last year, aiming to return the company to sustainable and consistent growth.
Kirkby laid out plans last year to cut billions in costs through 2025, including shedding staff, divesting assets and streamlining operations to spur growth and shareholder returns.
One of the bigger divestments is the sale of a 49% stake in its towers unit to Brookfield and Alecta. The unit now has an enterprise value of 2.6 billion euros ($2.9 billion).
While several European telecom operators are getting out of towers business completely, Telia is taking a longer-term view and has opted for the joint-venture route
Telia’s fourth-quarter adjusted EBITDA fell 1.6% year on year to 7.29 billion Swedish crowns ($778.02 million), slightly better than the average estimate of 7.22 billion crowns from analysts polled by Refinitiv.
While advertising revenue is back at pre-pandemic levels, boosting TV and media business, roaming revenue is still down because international travel has yet to recover fully, Kirkby said.
“Based on what we saw in December, we are expecting the rebound from roaming to definitely start to come through during the course of this year,” she said.
($1 = 9.3699 Swedish crowns)
($1 = 0.8983 euros)
(Reporting by Supantha Mukherjee in StockholmEditing by David Goodman)