Telia reveals US$2bn impairment that will ‘negatively impact’ 2022 income

Swedish telco Telia has warned investors that its 2022 financial results will be impacted by non-cash impairments in the order of $2 billion.

Allison Kirkby

In a short statement, the company said: “After conducting a review of the carrying value of Telia Company’s assets and reflecting the changed macro-economic landscape and increase in the company’s Weighted Average Cost of Capital (WACC) from increased market interest rates, there is a need to perform non-cash impairments of goodwill in a number of Telia Company’s business units. Specifically, non-cash impairment charges of SEK 9.5 billion relating to Finland, SEK 8.5 billion relating to Norway, and a total of SEK 1.1 billion relating to Denmark and Latvia will be recorded.”

In addition, said Telia, there will be a SEK 0.3 billion non-cash impairment related to the C More brand “following the decision to consolidate the C More business under TV4 in Sweden and MTV in Finland. Finally, the decision to fully dismantle the copper network in Sweden by 2026 resulted in a non-cash impairment of SEK 0.4 billion.”

Telia said the total impairment of SEK 19.8 billion ($1.96bn) will negatively impact the operating income for the fourth quarter and full-year 2022. “Until the audit of the full year 2022 results is completed, all financial references are preliminary,” it added.

When markets opened, the Telia share price fell about around 1% in early trades.

In separate news, Telia appointed Ola Rembe as SVP, head of communications, brand and sustainability last week. Rembe takes up his position in March.

Allison Kirkby, Telia Company president and CEO, said: “Due to his knowledge of our sector and track record at Ericsson and most recently as partner at Kekst CNC, Ola Rembe will play a critical role in communicating the full breadth and potential of Telia’s networks and services, while leading our contribution to a climate-neutral future.”