Sunrise

Added to your personal report..

Personal report

You can add pages or sections to your own TDC report.

Go to your Personal report page to add or remove pages, and download your report

Glossary

In 2009, revenue and EBITDA in Sunrise totaled DKK 9,866m and DKK 2,510m, respectively, compared with DKK 8,705m and DKK 2,147m in 2008. The EBITDA margin was 25.4% in 2009, compared with 24.7% in 2008.

At year-end 2009 Sunrise had 1,550 full-time employee equivalents, compared with 1,474 in 2008. At year-end 2009, Sunrise had 2.9m customers, which was unchanged compared with year-end 2008.

Revenue

In 2009, Sunrise's revenue totaled DKK 9,866m, up by DKK 1,161 or 13.3%. In local currency, revenue increased by 7.8%. The significant revenue growth was due mainly to the acquisition of Tele2 in 4Q 2008, which had a full-year effect in 2009, and a significant favorable exchange-rate development, which was, however, partly offset by the divestment of SBC in 2008. Excluding these issues, revenue increased by approximately 3%. Revenue from landline telephony amounted to DKK 3,255m, up by DKK 578m, or 21.6%. In local currency, revenue from landline telephony increased by CHF 90m, or 15.8%. Besides the acquisition of Tele2, which was only partly offset by the divestment of SBC, the growth in landline telephony was positively affected by increased wholesale revenue. In 2009, revenue from internet services amounted to DKK 899m, up by DKK 188m, or 26.4%. In local currency, revenue from internet services increased by CHF 31m, or 20.5%. Besides Tele2, revenue was affected by an increase in the ADSL customer base that was partly offset by the discounts given to the larger number of subscribers on the ULL platform, which increased from 20,000 to 133,000 at year-end 2009.

Revenue from mobility services amounted to DKK 5,712m, up by DKK 395m, or 7.4%. In local currency, revenue from mobility services increased by CHF 23m, or 2.0%. Apart from the acquisition of Tele2, the increase in revenue from mobility services was driven by growth in both postpaid and prepaid revenues. However, this was offset by lower revenue from mobile termination due to price regulation1 and a higher share of on-net calls. Further, revenue from sale of handsets declined.

In 2008, revenue totaled DKK 8,705m, a decrease of DKK 137m, or 1.5%. In local currency, revenue decreased by CHF 92m, or 4.7%. Revenue in Sunrise was negatively affected by the divestment of SBC, which was more than offset by a favorable exchange-rate development and to a lesser extent, the acquisition of Tele2 in 4Q 2008. Excluding these impacts, revenue in Sunrise decreased by approximately 3%. The decline in revenue was driven mainly by landline telephony with a DKK 68m or 2.5% decrease, which was driven by the divestment of SBC and lower activity prior to the divestment, and lower ARPU, partially offset by higher wholesale revenue. Mobility services also had a negative impact on revenue development with a decline of DKK 56m, or 1.0%, driven mainly by lower retail and termination prices. The latter related to national regulation. Mobility services was also affected by lower revenue from sale of handsets, partly offset by a larger prepaid and postpaid customer base.

Gross profit

In 2009, gross profit totaled DKK 6,156m, up by DKK 661m, or 12.0%. In local currency, gross profit increased by 6.5%. Transmission costs totaled DKK 3,475m (CHF 705m ), up by CHF 44m, or 6.7%. Cost of goods sold totaled DKK 235m (CHF 47m), up by CHF 24m, or 104.3%. The higher costs were driven mainly by increased landline wholesale activity, the full-year effect of Tele2, increases in costs from 2008 to 2009 due to non-recurring compensation from Swisscom in 2008 regarding an adjustment of excessive landline termination charges between 2006 and 2008, the currency effect, and higher ULL fees, which were almost entirely offset by ADSL related to cost savings. The increases were partly offset by the full-year effect of the divestment of SBC, as well as lower mobile roaming and termination prices due to regulation, and lower handset sales.

In 2008, gross profit totaled DKK 5,495m, a decrease of DKK 67m, or 1.2%. In local currency, gross profit decreased by CHF 53m, or 4.3%. Transmission costs and cost of goods sold were positively affected by non-recurring compensation from Swisscom in 2008 regarding an adjustment of excessive prices for termination charges of landline calls from 2006 to 2008, the divestment of SBC, as well as fewer sold handsets and lower ADSL wholesale and mobile termination prices from Swisscom. These effects were partly offset by the higher wholesale activity, the increased volume of prepaid subscribers, and the exchange-rate development.

Income before depreciation, amortization and special items (EBITDA)

In 2009, Sunrise EBITDA totaled DKK 2,510m, an increase of DKK 363m or 16.9%. In local currency, EBITDA increased by CHF 51m, or 11.1%. The EBITDA growth related primarily to the acquisition of Tele2, the favorable exchange-rate development, which was partially offset by the cost increase from 2008 to 2009 due to the non-recurring compensation from Swisscom in 2008 regarding excessive termination charges from 2006 to 2008. Excluding these issues, EBITDA increased by approximately 9%, which was driven by gross profit related in particular to increased mobile activity, and reduced wages, salaries and pension costs. The effect was partly offset by an increase in other external expenses. Other external expenses totaled DKK 2,763m, up DKK 390m or 16.4%. In local currency, other external expenses increased by CHF 55m, or 10.9%. The increase was driven by the full-year effect of the outsourcing agreement (which was offset by a corresponding wage reduction), service level agreements and other items for Tele2, as well as a higher call-center overflow. Sunrise wages, salaries and pension costs totaled DKK 888m, a decrease of DKK 93m, or 9.5%. In local currency, wages, salaries and pension costs declined by CHF 30m, or 14.3%. Besides the divestment of SBC, this was driven by the full-year effect of the network outsourcing, partly offset by the increase in the number of FTEs due to the acquisition of Tele2 (53)2.

In 2008, EBITDA totaled DKK 2,147m, a decrease of DKK 240m, or 10.1%. In local currency, EBITDA decreased by CHF 68m, or 12.9%. The EBITDA development in Sunrise was negatively affected by the divestment of SBC, which was, however, more than offset by the non-recurring compensation from Swisscom in 2008 regarding excessive termination charges from 2006 to 2008, the positive exchange-rate development and the acquisition of Tele2. Excluding these impacts, EBITDA in Sunrise decreased by approximately 20%. The decline in EBITDA was driven mainly by other external expenses totaling DKK 2,373m, an increase of DKK 347m, or 17.1%, due primarily to higher customer acquisition and retention costs as well as outsourcing of network operations. Wages, salaries and pension costs totaled DKK 981m, a decrease of DKK 168m, or 14.6%. This was due mainly to outsourcing of network operations, divestment of SBC and additional FTE reductions in both 2007 and 2008 related to redundancy programs.

Selected financial and operational data Excluding special items
Sunrise    2009  2008  2007   Growth in %  Growth in %
                2009 vs. 2008  2008 vs. 2007
                    
    DKKm               
Revenue    9,866  8,705  8,842  13.3  (1.5)
   Landline telephony    3,255  2,677  2,745  21.6  (2.5)
   Mobility services    5,712  5,317  5,373  7.4  (1.0)
   Internet services    899  711  724  26.4  (1.8)
Transmission costs and cost of goods sold    (3,710) (3,210) (3,280) (15.6) 2.1 
Gross profit    6,156  5,495  5,562  12.0  (1.2)
Other external expenses    (2,763) (2,373) (2,026) (16.4) (17.1)
Wages, salaries and pension costs    (888) (981) (1,149) 9.5  14.6 
Operating expenses before depreciation, etc.    (7,361) (6,564) (6,455) (12.1) (1.7)
Other income and expenses    (16.7)  
EBITDA    2,510  2,147  2,387  16.9  (10.1)
                    
Key financial ratios                  
EBITDA margin  % 25.4  24.7  27.0     
                    
Customer base (end-of-year) '000               
Landline customers    635  730  457  (13.0) 59.7 
Mobile customers    1,863  1,768  1,524  5.4  16.0 
Internet customers    356  360  292  (1.1) 23.3 
Customer base, total    2,854  2,858  2,273  (0.1) 25.7 
                    
Number of employees    1,550  1,474  2,036  5.2  (27.6)
  1. The negative impact on EBITDA from price reductions on mobile termination was relatively low due to the spill-over effect on Sunrise’s costs.
  2. Though the company was acquired in 2008, the employees from Tele2 were not included in Sunrise's full-time employee equivalents until January 2009.