The performance in the third quarter reflects continued strong execution on our
strategy, focusing on growth, efficiency and simplification. Overall, the Group
delivers an almost flat organic subscription and traffic revenue growth and
organic EBITDA decline of 2%, when adjusting for project costs this quarter and
non-recurring items last year. Our cost base remained stable, excluding DNA and
project costs. 

The modernisation in Norway is progressing according to plan, and we see a 3%
mobile subscription and traffic revenue growth combined with a 5% reduction in
operating expenses this quarter. In Thailand and Myanmar, the momentum seen
earlier in 2019 continued and both operations have now returned to positive
subscription and traffic revenue growth. However, headwinds in Pakistan as a
result of the telecom tax re-introduction and a difficult macroeconomic
environment have made the situation locally challenging. 

During the quarter we have successfully concluded the acquisition of DNA in
Finland. The mandatory tender offer period ended on 10 October and resulted in
an ownership share of 97.96 percent. We have started to onboard DNA to our
procurement processes to materialise synergies, and we are now looking for
opportunities to expand service offerings to Finnish business customers. 

Recently, we have also taken further steps on our simplification agenda.
Yesterday, we announced that we will be entering into a joint venture with
Nordic Entertainment Group, combining our satellite-based entertainment
businesses to extract synergies and deliver enhanced customer experience. 

Based on the performance so far this year and our expectations for the fourth
quarter, we maintain our outlook for 2019. Execution on our strategic agenda
remains our focus and key driver for value creation going forward, said Sigve
Brekke, President and CEO, Telenor Group.

Third quarter 2019 summary

•	On 21 August, Telenor completed the acquisition of DNA and subsequently
initiated a mandatory tender offer for the remaining shares, which ended on 10
October with Telenor achieving a holding of 97.96%. DNA was consolidated from 21
August 2019.2
•	Subscription and traffic revenues decreased by 1% on an organic basis. In a
challenging market environment, revenues in Pakistan declined significantly,
offsetting growth in several other markets. Total reported revenues increased by
7% to NOK 29.5 billion. 
•	Currency adjusted gross profit excluding DNA declined by NOK 0.8 billion,
impacted by the revenue drop in Pakistan and reversals last year. Reported gross
profit increased by NOK 0.6 billion.
•	Currency adjusted opex increased by NOK 0.6 billion, but was stable excluding
DNA and project costs related to the DNA acquisition and the Axiata merger
discussions. Reported opex increased by NOK 0.9 billion or 10%.
•	EBITDA decreased by 7% or NOK 0.9 billion on an organic basis, primarily as a
consequence of the development in Pakistan. Reported EBITDA before other items
was NOK 12.1 billion with an EBITDA margin of 41%. 
•	The Group generated Free cash flow before M&A of NOK 2.8 billion in the
quarter.

Outlook for 2019

Based on the performance so far this year and our expectations for the fourth
quarter, we maintain our outlook for 2019. We expect organic subscription and
traffic revenue growth at around the 2018 level and a low single digit organic
EBITDA decline. Capex excluding licences and spectrum is expected to be in the
range of NOK 16-17 billion, excluding DNA.