DNA Plc's Half-Year Financial Report January-June 2018: DNA's net sales, result and subscription base grew in the first half of 2018

DNA PLC STOCK EXCHANGE RELEASE 19 JULY 2018, 8:30 AM EEST DNA arranges two news conferences today. News conference for media and analysts is held at 10:00 am Finnish time. Conference call for analysts and institutional investors is at 2:00 pm Finnish time. Details of the events can be found at...

London, 19/07/2018 (informazione.it - comunicati stampa - telecomunicazioni)

DNA PLC STOCK EXCHANGE RELEASE 19 JULY 2018, 8:30 AM EEST

www.dna.fi/investors

Unless otherwise stated, the comparison figures in brackets refer to the corresponding period in the previous year (reference period). Figures are unaudited.

For 2018, as required by the IFRS standards, the financial tables contain figures reported according to the IFRS 15 and IFRS 9 standards adopted on 1 January 2018. As required by IFRS 15, figures adjusted are disclosed as if they were prepared under 2017 revenue guidance. The comparative analysis in the report section is disclosed as if the figures were prepared under 2017 revenue guidance.

DNA's net sales and comparable operating result are expected in 2018 to remain at the same level as in 2017. The Group's financial position and liquidity is expected to remain at a healthy level.

DNA's guidance for 2018 is disclosed as it was prepared under 2017 revenue guidance and does not currently incorporate the potential impact from the adoption of IFRS 15 as of 1 January 2018.

Figures are unaudited.

DNA had a strong first half of 2018. Our net sales increased 3.5% to EUR 447.8 million, and our operating result 18.1% to EUR 70.1 million. Operating result as a percentage of net sales increased and was 15.6%. Both the mobile device sales and mobile service revenue grew. Mobile service revenue was boosted in particular by the positive development of our subscription base.

During the second quarter, both our net sales and operating result increased further. Our mobile communication network subscription volumes were up 73,000 from the reference period, despite intense competition. Our fixed network broadband and cable television subscription base grew in total by 26,000 subscriptions from the reference period.

DNA's revenue per user (ARPU) for mobile communications improved and was EUR 18.7 in the first half of the year, compared to EUR 18.0 a year ago. Our ARPU was strengthened in particular by 3G subscribers switching to high-speed 4G subscriptions. Our mobile communication subscription turnover rate (CHURN) remained at a low level of 15.4% in the second quarter of the year. The CHURN rate for the first six months of the year was 17.1%, which is lower than in the reference period. This was due to high customer satisfaction, and also, while competition remained intense, we were able to secure our customer base by reacting quickly to our competitors' campaign changes.

We have been preparing our mobile network for the 5G era since 2016. During the second quarter, we tested the 5G technology in our production network on a 3.5 Gigahertz (GHz) frequency band. The Ministry of Transport and Communications estimates the auction for the first 5G frequencies to start on 26 September 2018. We estimate that the commercial launch of our 5G services can take place during 2019.

In the second quarter, we announced that our backbone network capacity will be raised to a new level. The work has already begun and once completed, the production capacity of DNA's backbone and regional networks will rise to 5G-network level. This will be of immediate benefit to our mobile and fixed-network customers, as data transmission volumes on our networks have reached yet another record-breaking level.

In the second quarter, we also introduced the new DNA Connectivity IoT service to open global IoT ecosystem opportunities for Finnish companies. Implemented with Cisco Jasper, the service allows companies to develop and grow their IoT services businesses across both national and international markets. We have invested in the IoT service and the expertise of our personnel in order to become a significant operator in the IoT market.

Our guidance remains unchanged and we expect both DNA's net sales and comparable operating result in 2018 to remain at the same level as in 2017. DNA's financial position and liquidity is expected to remain at a healthy level.

Jukka Leinonen
President and CEO

www.dna.fi/investors

Jukka Leinonen, CEO, DNA Plc, tel. +358 44 044 1000, jukka.leinonen(at)dna.fi
Timo Karppinen, CFO, DNA Plc, tel. +358 44 044 5007, timo.karppinen(at)dna.fi
Marja Mäkinen, Head of IR, DNA Plc, tel. +358 44 044 1262, marja.makinen(at)dna.fi
DNA Corporate Communications, tel. +358 44 044 8000, viestinta(at)dna.fi

is a Finnish telecommunications group providing high-quality voice, data and TV services for communication, entertainment and working. DNA is Finland's largest cable operator and the leading pay TV provider in both cable and terrestrial networks. For DNA, the key area for growth in corporate business is the new way of working, independent of time and place, facilitated by smart terminal devices, diverse communications services and rapid connections. In 2017, DNA recorded net sales of EUR 886 million and an operating profit of EUR 124 million. DNA has more than 3.9 million subscriptions in its fixed and mobile communications networks. The Group also includes DNA Store, Finland's largest retail chain selling mobile phones. DNA shares are listed on Nasdaq Helsinki Ltd. For further information, visit www.dna.fi or follow us on Twitter @DNA_fi and Facebook.