Profits up at TeliaSonera following job cuts

Profits up at TeliaSonera following job cuts

Finnish-Swedish telecoms company TeliaSonera said on Thursday it increased its third-quarter profit by 15 percent from the equivalent figure last year as a result of layoffs and other cost-cutting measures.

Profits during the quarter amounted to 4.64 billion kronor ($720 million), exceeding the forecasts by analysts interviewed by Dow Jones, who expected 4.5 billion kronor.

But net sales fell by 1.8 percent to 25.38 billion kronor.

“Profitability was supported by a further reduction in the cost base,” TeliaSonera chief executive Johan Dennelind said.

Following a restructuring plan launched in October 2012, the company has laid off 1,460 workers, or about five percent of the total workforce.

“It is crucial to have an efficient organization and an appropriate cost base,” Dennelind said.

“We have to reduce complexity to enable an effective way of working, accelerate decision making and ensure our employees stay skilled and motivated.”

Revenues continued to be impacted by “a difficult economic environment” and rules making it cheaper for mobile users to cancel their subscriptions, Dennelind said.

The biggest revenue falls were in Estonia (13 percent), Norway (8 percent), and Lithuania (7 percent), whereas Spain improved its figures by 3 percent thanks to the growth of its mobile operator Yoigo.

AFP/The Local/dl

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‘Rotten’ business claims at Nordic TeliaSonera

Swedish-Finnish telecom operator TeliaSonera has been accused of “rotten” business dealings in Azerbaijan, following a separate bribery scandal in Uzbekistan.

'Rotten’ business claims at Nordic TeliaSonera
A TeliaSonera conference in Stockholm last year. Photo: TT

Folksam, which is one of the largest insurance companies in Sweden, has accused the firm of “systematic cheating”, after it emerged that TeliaSonera’s subsidiary in Azerbaijan had ties with the family of Ilham Aliyev, the Arab nation’s leader.

It has been claimed that the dictator’s daughters were shareholders of TeliaSonera's subsidiary Azertel, via a connected company based in Panama.

“It is distressing that in a large Swedish company…people thought that cheating would pay off in the long run,” Carina Lundberg Markow, one of Folksam’s managers told the TT news agency on Wednesday.

She criticized TeliaSonera for failing to act “in an honest and open way” when entering new markets.

“Instead, they choose to pay for success,” she added.

TeliaSonera is one of the biggest telecom operators in the Nordic and Baltic countries and also operates in several emerging markets in Eurasia including Russia and Turkey, as well as Spain. The Swedish state owns 37.3 percent of the company.

Swedish prosecutor Gunnar Stetler is already investigating claims of unethical business practices in Uzbekistan and told TT he had also been given new information concerning potential bribery in Azerbaijan.

The company has voluntarily cooperated with the investigation, handing over what Stetler describes as “extensive information” about “the terms and conditions in Eurasian countries”.

Stetler said he was unable to discuss how he had responded to the information. But calls are growing for TeliaSonera to release a public report about its business dealings.

“Now it is extremely important to create transparency,” said Lundberg Markow.

“This shows the importance of having a set of values when doing business in complex markets or countries,” she added.

TeliaSonera and Norwegian rival Telenor recently merged their operations in Denmark, while the telecoms giant last year purchased rival Tele2's Norwegian division for 5.1 kronor.