Welcome, everyone, to this press conference and webcast teleconference. My name is Stefaan, and I'm the Head of Corporate Relations, Sustainability and Communications at Investo. This conference is about presenting our Q3 report, and the presentation will be available afterwards on our website that can also be viewed now in real time online. We will hear presentations by CEO, Johan Forschel and by CFO, Liana Saxon. And we also have our Investor Relations Manager, Anjou Stahl Amar, here with us.
We will take Q and A after the 2 presentations. Once again, very welcome. And with that, I'm handing over to you, Johan.
Thank you, Stefan, and a warmly welcome, everybody, to this conference. Let me start by giving a quick overview. If we start by the year to date performance, our net asset value has been up some 14%, 15%. And I was told to share the return is up 21% compared to the stock market plus 12%. If we look on the quarter 3 in isolation, you see that our performance is more or less flat compared to the stock market, up 2%.
On the listed side, of course, a key highlight is that Ronen Retten has been nominated as the Chairman in Ericsson and that we have purchased more shares in Ericsson. When it comes to strategic industries, I will say it's a mixed performance in the quarter, and I will come back to that later on. Importantly, Ma'am, we continue to generate a very strong cash flow, and that has made it possible to distribute EUR 4,300,000,000 in the quarter. Finally, EBT continues to perform strongly with a value change of 3% and a net cash flow to invest of EUR0.3 billion. So let me then start by the listed core investments.
If we look, the performance has been good so far this year. Year to date, the listed portfolio is up 18% compared to the stock market of 12% and the quarter is up 2% in line with the market. Let me then say a few words about Roni. I mean, it has already been written, a lot about it in the press, but it has been a full agreement in the nomination committee that Roni Liapen is the right person for this task. Ronny has a very strong track record when it comes to value creation from the companies he has been in before.
He has also, as you know, a very solid industrial background. He's a skilled businessman. He is very versatile when it comes to strategic thinking that he has proved over and over again not the least in Atlas Copco. So I'm very pleased that he has been nominated as chair for Ericsson. We have acquired shares for EUR 1,200,000,000 in Ericsson in the quarter.
And you might also remember that we bought EUR 1,000,000,000 in the Q4 last year. So in Tuktoy, we have invested 2,300,000,000 in the company. And the key reason for it is that we believe that long term, this will prove to be a good investment. When it comes to rights, civil rights will operate in 2 key segments. 1 is marine and 1 is on the energy side where they have basically built small power plants with their engines.
And on the energy side, we have seen very good big orders from emerging markets, Bangladesh, Indonesia and before that, in Argentina. A number of our companies have also made large strategic investments. ABB recently announced the acquisition of GE Industrial Solution within Electrification, and that is a $2,600,000,000 acquisition, and that will strengthen the position within electrification and then mainly in the U. S. Market.
And also, Nas Tech has done a rather sizable investment within Information and Analytics. That's roughly a $700,000,000 acquisition. So in summary, good performance on the listed side, both performance wise and also a number of activities going on. On the Takeda side, if we adjust for the cash situation, the market value, the adjusted market value, when we try to estimate the market values, amounted to BRL 92,000,000,000 in the quarter, and that is actually down 1%. And Helena Saxa will later on come back to that and show you the bridge, what has really driven that performance.
But let me take a step back. What are our priorities when it comes to Partition Industries? The first one is to develop the existing companies. The second one is to find new platforms in the Nordics and the U. S.
And the third is to basically gradually divest the financial investment portfolio. If I should just say a few words about the activity going on in the existing portfolio. In Laboree, we announced that we have a new CEO, Mike Frassett, that joins in the quarter. He has 11 years experience from Smith and Nephew, the latest being as a Chief Commercial Officer. I also would like to highlight actually Perma Bill.
Perma Bill, we have talked before about the launch of the M3, the mid wheeler, and now they actually are launching M1, which is a smaller version. So there is a lot of activity going on when it comes to launching new products. And you have also seen that they now very recently have announced 3 acquisitions, 2 distributors in New Zealand and a product company in the U. S. Market that makes basically cushions, backrests and some accessories to that.
So it's a company where during the 4 years we had owned Perma Build, sales and profits are more than doubled, and now we continue to grow this business. Moving over then and say a few words about finding new platforms. The latest acquisition we did was last year when we acquired Canadian company, Lavalry. This year, we have not made any new acquisitions. And it's fair to say that if we look in the market today, there is a lot of money out there chasing assets, and we all know that valuations are high.
We are continuously looking and trying to find new platform acquisitions, But we will stay disciplined, and we will only invest when we find the right companies that we can acquire at the price where we can get our return requirements. It's very easy to come and announce an acquisition. It's just paying more than anybody else. That's an easy part. But that's not why we are here.
We are here to make money for our shareholders. So we will stay disciplined, but we are actively working on this one. The third part, managing the financial investment. Here, I must say, I think the development is going in the right trajectory. During the quarter, more than DKK500 1,000,000,000 was released by divesting some of the financial investments.
Then going over to Melendik here. You have all seen that the growth in the quarter was weak, only 1%. There are a couple of reasons for it. The first one is that the growth in the U. S.
Market was lower than we have seen previously. In the quarter, the growth in the U. S. Market was roughly flat, and previously, we have seen better growth figures. In the European market, we actually see volume growth.
But due to the reimbursement cap in France, prices have come down, so the order revenue is more or less flat also in Europe. So the key growth driver has been the margin market, and this is the positive part. If I look on the growth markets, China, Middle East, Brazil, all these three markets were growing more than 15% in the quarter. So of course, they are smaller parts, still a smaller part of the pie, but they are actually the ones that now start to show the growth that I show on this page, even though it's only 1%. And that is the work that we will continue to really find this growth opportunity in the emerging market.
But we must also increase the speed when it comes to product innovation and getting more feet on the street in the ordinary business. And that is a work that is ongoing. And the top priority for us is to increase the organic growth. Coming back to the profitability, a little bit fewer comments on that. In the quarter, the company took a decision to close down an unprofitable line, which was basically rental of pumps related to negative pressure.
That meant that the company took a onetime cost to close that down. If we adjust for that, we can see that the profit margin is still down year over year, but it's actually up sequentially compared to the Q2. So why is the margin still down from on an EBITDA level, I think 31% last year to 28%, 29% this quarter? The key reason is the reimbursement cap in France. And the second reason is that we continue to see somewhat higher raw material prices year over year, even though we continue also to see that on a sequential basis, it's roughly on the same level.
And finally, then we have the distribution that I mentioned, which, of course, will lead to an even stronger balance sheet at Patricio and Investor level, and Juliena will come back to that. Poromobil, organic growth of 3% in constant currency in the quarter. I mentioned that there is a good reception of the new products. And also in this quarter, that was the same in the Q2. Order intake continued to be somewhat above the sales figure.
So I think we see a solid development on this side. The growth was mainly driven by the power and the seating and traction side, while the manual business line was more or less flat in the quarter. And here, we did see profit margin improving and also some good operating leverage. And then I think I have mentioned already the acquisitions and the product launches. Labor Re.
Also, Labor Re grew 3% in the quarter. And here, we also see the profit improving despite that we actually taking quite significant investments in business development and in the operations. And as I mentioned, there is a new CEO in place. Alerius had an organic growth of 1%. And here, we did see, as you can see, a margin improvement.
The margin improvement was mainly driven by the Healthcare side, while the margin was somewhat lower on the Care side. But in aggregate, the margin improved. The company has done a small but important acquisition, Cristina Clinique, which is within cancer treatment at Sysiha Helmut. And then finally, the vulnerability. I mentioned during the Q2 press conference or conference call that the backlog was very strong in vulnerability related to the new products, and we can see that the backlog has really been executed.
The sales force was at 11% in the quarter, And the demand continues to be very good on the consumer side, both when it comes to Chrysler Pacifica and the new Toyota model. The margin was more or less flat in vulnerability. And the best way I should try to explain it is that on the positive side, we see the volume impact, which, of course, gives some leverage. On the negative side, there are some inefficiencies, some ramp up cost when it comes to going over to these 2 models, and they basically canceled out each other. And then we have 3 Scandinavia.
I will not say a word about that because we actually have Piave in the room. You are warmly welcome. So we have the profession in here. I will not say a word about that. But in France, the jump over to EQT, you have seen the figures.
In the quarter, as I mentioned, SEK300,000,000 coming in. Year to date, that means that we have received about SEK1.8 billion from EBITDA. And the year to date performance is something like 14%, 15%. So to summarize, these are the strategic priorities we have: more companies to become best in class, and we are working with a number of companies as you see to really drive improved performance. We will continue to strengthen ownership in selected listed core.
Over the last 2, 3 years, we have invested in Daiceli, Atlas Copco, EBITDA and now Ericsson. Over the last decade, we have invested in more or less all companies except AstraZeneca. In Partition Industries, organic growth is the key priority and, of course, to develop the companies, both when it comes to product innovation and on new markets and also finding new add on acquisitions like the ones I discussed when I presented Permobil. And we are continuing to look for new investments at investor facilitation level. But as I said, we will continue to be disciplined.
In Q3, we get excellent returns. We will continue to invest in their funds. And then finally, on the cost side, we are well in line or actually below the targets we have set up. So that is going well. All in all, our ambition remains to continue to pay good dividend and hopefully then to deliver also a good return.
So with that, I hand over to you, Giuliana. Thank you, Johan.
Let's start with the financial highlights then. Reported net asset value landed at BRL 336 billion at the end of the quarter, an increase of EUR 4,000,000,000 equivalent to 1% increase. Based on estimated market values for potential industries, the adjusted asset value landed at EUR 380,000,000,000. So what contributed to the reported net asset value growth? Well, mostly listed core investments.
We can see on this slide that more than EUR 4,000,000,000 came from that area, while EUR 100,000,000 was contributed from Patricia Industries and around EUR 200,000,000 from ETT. Within listed core investments, we can see that 3 companies really contributed to this growth: Atlas Copco, Baixsimile and Esavel, while Ericsson, of course, weighed on the performance. If we look at the estimated market values compared to our reported values, we can see that Patricia without cash landed at EUR 92,000,000,000, which is around EUR 45,000,000,000 more than the reported value. And this difference is explained mainly by nanotech but also car mobile and food. So if you look at the estimated market value development during the quarter, and here we include the cash position because if you look at Nelike on the slide, you can see that Nannike seems to be down EUR 5,100,000,000, but it actually includes the distribution of EUR 4,300,000,000, which lands in the cash position to the right over there.
So actually, Mannlicue was only down EUR 900,000,000 during the quarter. And the major drivers then of the estimated market value during the quarter was the SEK 900,000,000 for Mannlicke. Manliquet was impacted by higher multiples, but of course, showed lower operating profit. And currency, euro versus the krona, also impacted negatively. If we look at the vulnerability, the market value also decreased, and that was mainly due to multiples and also the weakening dollar versus the krona.
3 had a small increase. Cash flow was positive, but operating profit impacted negatively, and the multiples, in this case, were flat. Thermobil increased its market estimated market value by EUR 200,000,000, and this was due to positive impacts from operating profit and cash flow. But however, in this case, the multiples contracted have a negative impact on the estimated market value. Financial investments is the run off portfolio within Patricia Industries.
It amounts to around SEK 7,300,000,000. There were some smaller follow on investments during the quarter, but divestitures amounted to almost EUR 600,000,000 and 3 companies were fully exited among them, TOBI. Looking at our balance sheet, we can see that our leverage is only around 3.4%. Net debt amounted to almost EUR 12,000,000,000 and our gross cash position almost EUR 19,000,000,000. The average maturity of our debt portfolio is a little more than 10 years, and we still have the very strong ratings that you have seen before.
That's what I was about to say. Stefan?
Thank you, Irma. I'm going to move over to the Q and A session. And starting in here, I'm going to move over by telephone and look at
on the web as well.
First question?
Magnus von Handelsbanken. Moving to Mondeleke Dam, you made some further explanations to the weak organic growth.
You mentioned here that growth in the U.
S. Market is flat. Does that imply that you lose market share in the U. S. Market?
And also maybe if you can comment on the market share situation in Europe.
I cannot give you the details on the 3Q market share development because we haven't seen the peers yet. But what I can see is that if we look on the 2Q performance, also in 2Q, NANDLE could perform roughly at the 1% level. If you look on the key peers, they were at roughly that level, too. So from that perspective, it seems that we did not lose market share. On the other hand, of course, our ambitions are higher, but that's what we see when we look at the facts.
So that was from a global perspective? Yes. I think you mentioned that you were growing in emerging markets and being flat in the U. S. My question was if the U.
S. Market was flat.
We cannot do that because then we need to have a lot of details among the competition for those product segments, and we don't. Right. So
just thinking about your ambitions when it comes to organic growth, I mean, if we look back some 3 years, your organic growth rate has been at an average of around 5%.
If we look back 1 year, it's
down at 2.5%. And in the recent 2 quarters, as you mentioned, have been down at 1%. Is your ambitions still for mid single digit organic growth rate going forward from M and A? Or is this lower level something we should expect?
No. For sure, our ambitions are much higher than the performance we have at the moment. If you have a company that runs with profit margins 25% to 30% and also have a cash flow profile that is so strong as in this case, the majority of the value creation will come from growth, both organic and complementary add on acquisitions. So the key priority for the coming years is for sure to make sure that we get good organic growth complemented with acquisitions. That's the key priority.
How it would be in the next quarters, I will not go into that because that will depend on market and another. But our ambitions, for sure, are to get good organic growth also going forward. Then just
a final one on profitability. And then you mentioned here that capital reimbursement levels in France is the key reason behind the weakness. And you also had some one offs such actually adjusted for here already when you mentioned the weakening of the EBITDA margin. But how about price investments to support top line? I mean, if those are not major, then when we see an annualization of the cap reimbursement level in France, we should not see a continued deterioration of the margin in London.
Is that fair to assume?
I think when it comes to and it's a very good question. But when it comes to the price and how you price the product compared to competition in different regions for different product categories, that for sure is an operational question in my mind. And my answer is that I'm we believe that the management should take that responsibility, and they need to look at different situation. And it will be different situation and different geographic market for the client. So I will not comment on that because it would be wrong.
That's not how we operate. It's an operational Okay. Fair enough. Just one question also on Ericsson.
You mentioned here that you're investing and you believe that this would be creating good returns in the long run. But you as a major owner of Ericsson, if you can just give us a comment of how you view the long term potential for the company in terms of the major opportunities, but also the most the largest risks that you see in this company.
I think to be fair, I should not go into the details of that business. You should, of course, ask the management and the Eirix on those questions, and they will report later this week. But from our perspective, the key things that they tried to address, the focus on the core business, mix rationalization when it comes to the service POC, focus on winning the 5 gs, focus on winning on the network side and then do some changes in the portfolio structure when it comes to NIVEA and at the same time work on cost efficiency in the operation because there is competition out there. That is what we believe is correct. If they succeed with that, our strong belief is that this company has the potential to really become a long term winner again, and that's why we are investing.
I have two questions. The first one is on Nelvik. If look at the organic growth, is that impacted whatsoever by any losses or patterns for the company this year? And my second question is Alias. We can start off with Alias.
No, I cannot answer that because there are so many factors going on in it. So we I cannot answer that.
But as far as you know, there are no major packers which have been expired, which could have a major impact this year or for Nambikea.
Normally, I would say that when it comes to patents for most companies, including Randeka, of course, patents can be useful, especially, of course, if you take away certain parts certain businesses like, for example, the pure pharmaceutical company. Of course, patent is the life of that business. But if you take more, call it, neptech engineering companies and so forth, we should not overestimate the value of the Patent because it's very much being continuously ahead of competition in development because competition is catching up, but then you need to do it to the next level. So I would rather say that, that is more important than different patents. But of course, in certain products, in certain regions, patent expiration can be a smaller explanation or an explanation.
And if you were
to look at the organic growth, and you looked at the surgical part and the wound care business, so it's not 2 questions in what I feel. What is the growth profile between Wound Care and Surgical right now So far this year?
Yes. So far this year, it's not a major difference between it.
My question on Alir, it has to
do with margins. Is the new CEO implementing in the new cost cutting programs, which is having an impact right now? And is that the effect why you see the EBIT margin coming up in the Hospital business?
I think the focus is, AMERIS consists on a number of different parts. And I think what Alexander and his team are trying now to do is to make sure we keep the strong positions. We have certain areas, both radiology in Norway and in Sweden, that is very good, certain parts and care for use, etcetera, that has performed well. But then we also have certain parts where we need to improve, for example, the health care situation in Stockholm. And what the team is trying to do, which is the key, I think, is try to decentralize the business more, try to move the decision maker closer to the customer.
If you can do that, is it cost or efficiency? It's a definition question. But the thinking is by decentralizing, decision can be taken quicker, and then you can have a more cost efficient operation, but also actually much better care for the customers. So decentralized and decentralization is a key thing that they are working on right now.
Yes, Porsche at Nordea. You mentioned sustainability 5 times in your CEO statement, maybe, but not really concrete. Can you tell us something about what you're doing? Yes.
No, I think sustainability is a very important area. And sometimes, you can see different ratings and so forth. And I think from our side, we are working in terms of the on it, and we are doing it for the reason that we believe it will be important for our performance. So what are we doing? First of all, we have to distinguish.
We, of course, is trying to do what we can with this us, but the biggest impact, of course, is as an owner of the companies. The way we do it is that we try to see in our companies how well are the companies performing and how well they're quick guarded when it comes to processes, call it, in Swedish. That you really follow-up, you have the different parts. But we also look in the second dimension, and that is how is sustainability integrated in the business. And that means business areas really running the business to capitalize on the opportunities that sustainability creates.
So we have a matrix for all our companies. We evaluate and we have discussions with the companies to continue to improve because the fact is today that, that is a great opportunity to gain market share if you can really integrate it into the business.
But of course, you also need
to make sure you have good order.
Do you believe there's a mismatch about how the market perceives you from an ESG perspective rather than how we operate?
It's difficult to say how we are perceived. Let me say it like this. If you go back 5, 6, 7 years, I think we and many others, we saw it as an important area. We started to talk about it and so forth, but maybe had not really worked through so much. Today, I must honestly say that during the last 2 years, we have spent a lot of time in doing this, both here at Investo but also in a very close dialogue with the companies.
And CFNA is meeting regularly the people out in our companies to discuss this. And we are following in that process to the Board. And finally, we have, as you know, when I presented that many times to you, value creation plans for the companies. Normally, we call it 3, 4, 5 most important parts that we believe would drive value for the companies. We have now started to add sustainability in other value creation plans for all our companies.
Final question, if I may. The adjusted NAV forward? You said that you are evaluating that as a potential. And can you also give us some of the feedback you received from investors?
Yes, now what do you say?
I don't I'm not sure we have said that we are evaluating. We are very happy with the change that we made. We have received positive feedback. It is nice supplementary information that I think you and investors appreciate, but we have no plans on replacing the reported net asset value. As I think we discussed before, it's good to have the history and the development from a long time.
So we will stick to that. But we're very happy with the change.
It seems like the most central questions have already been asked.
But given that you will be patient with new investments, your current very low gearing and evidently very strong distributions from the presences, Could you provide an updated view on your what is your stance regarding using your own balance sheet to create further shareholder value? I think we have to remember that we, as you say, if we find good opportunities, we're not afraid at all to use that. And we have said that if we would find a large one, we could even go beyond the 10%. So it all boils down to if we can find attractive investment opportunities, whether it's on the listed or on the unlisted side. To put it a little bit in perspective, if you look at over the last couple of 2, 3 years, we have invested some 8 euros 9,000,000,000 in the listed.
We have acquired 2 subsidiaries in the U. S. Markets. In total, we have invested probably something like €16,000,000,000 So we are, of course, continuously looking for it. As we presented at the Capital Markets Day, over a decade, we have invested EUR 42,000,000,000 on the listed side, both new and in the existing ones.
So but we are not going to do investment just to do it. We need to find the right companies. And we will prioritize our existing ones. And if we buy new ones, we really would like to have companies that have a strong market position, good profitability, good growth prospects and good cash flow relation to earnings. That's a priority.
And then, of course, we need to be able to motivate the price we pay. We are willing to pay, call it, to fully price, but we are not willing to pay more than we can calculate based on our return requirement. That was an update. Sorry if I was unclear. My question was rather about what is your view on using your balance sheet for extra dividends or anything like that
now given your financial situation?
When it comes to the distribution, we took a couple of years ago a decision that we will focus on our dividend policy, and that is to have a steady rise in dividend all the time. And that is the priority, and we will continue to do that rather than extra.
Any more questions from the audience? Okay, thank you for that. Moving over to questions by telephone then.
And the first question comes from the line of Elizabeth Milianis with Bank of America. Please go ahead. Your line is open.
Good morning. Thank you for taking my question. Just back on Malaga and the investment cut. I'm just curious roughly how much does sales contribute to sales? And then further, what is your view of reimbursement cuts in France?
Do you expect this to be a continuing theme? Or is this just a one off? Thank you.
I can start with a latter question, what are expectations for future reimbursements in France or, for that matter, other countries? I have no idea. We cannot conclude that this has been taken, and we need to adjust because this is where we are right now. On the second or the first question, the size of the I will not give you figures, but for Mendik, France is an important market in Europe. So it's a big market for Mambuca.
Thank you. And one further question, how many more quarters should we expect the rising raw material prices to impact margin in 1 month ago?
I cannot predict the raw material prices, but what I can say is that the raw material prices increased up until, let's say, Q1 or something like that. We had the ramp up on the raw material prices. Over the last quarters, it has been more or less flat. But if you look year over year, it is still up. So if it stays at this level, this impact should gradually wind down.
But of course, I don't know where it will go.
Okay. Thank you.
Thank you. No further questions in queue. And there are no questions from the phone line at this point.
Okay. Okay. Thank you for that. Any questions under that, Mr. Barwana?
Thank you. And I'll leave over again for any questions from the audience. Okay. Thank you for participating, and thank you for listening in. Thanks.
And now Johan.
Yes. Then I have the pleasure now to introduce Peter Ramblen. He has been with SRE, I think, roughly a decade or so, most of that time being the CEO. But now he is an executive board person, but of course, extremely knowledgeable about this company. So we are extremely pleased to have you here.
The floor is yours.
Thank you very much. Okay. Well, that was not my idea, Fernando. But actually, I've been with
the company now for 11 years, a little
bit more than that. And we have been growing all the time. We are the challenger in the Swedish and the Danish markets, and we will continue to be that. We are a mobile only player, and we believe that we should stay as a mobile only player. In the rest of Europe, we can see that there are players, especially the open incumbents, who are offering triple play and quadruple play, and that's very popular, been very successful.
But we have not seen that in Scandinavia. I mean, the only player that tried triple play offer is triple play offer, it's come here. And that was not very successful. And they are not really giving offering that anymore because I think that most of the players in Sweden and Denmark, they only view a triple k and a quadruple k offer as a discount, and they haven't found the right way to do it. There are rumors that Telenor will come up with a big triple of product offering in Norway, but we haven't seen that yet.
We have 3,300,000 subscribers. We have a turnover last year of €11,500,000,000 The EBITDA result was 3.1,000,000,000 and that is 0.25 percent EBITDA margin. We have 2,006,000,000 full time employees, and we have had an annual growth since we started actually in 2,003, both in Sweden and both in number of subscribers and in revenue. The EBITDA development over time, I started 2,006. That's why I want to start with that number.
You can see we had an awful loss on the EBITDA level, and then it has been growing. And the changes or the dramatic increase you see in 2011 is due to accounting reasons. We made a change in the way we are looking at the accounting. So the development between 20 10/13/14 should is actually increasing about the same numbers each year. Looking at the being the smallest operator, I should say, both in Sweden and Denmark or the 4 large operators, We have to keep the cost very low.
So we are focusing very, very much on the cost since we have far less subscribers than our competitors. And you can see here the cost per quarter, the OpEx per quarter since Q1, 2,007, and the OpEx have increased by some 30%, 35% over that period. And then you can see the line that is the number of subscribers. And while the OpEx has increased by 30%, 35%, the number of subscribers has increased by 3.5x, 3 50%. Looking at the cash flow.
We have had a positive development of cash flow until last year, but I should say that this year will probably not be as good as last year even if it will be rather close. But we will invest quite dramatically in our network in Sweden 2018 2019. So you will not see a continued increase of the cash flow here in the coming 2 years. These numbers are not including the investments we have done in Spectrum. So Spectrum investments is not included here.
Looking at Sweden. We have 2.9 subscriber and 1,000,000 subscribers or rather subscriptions, I should say, not subscribers because the number of subscribers has 2 subscriptions or more. SEK 7,400,000,000 in turnover last year. We have 68 stores and 900 resellers. The number of stores will definitely not increase, but it will maybe decrease over time just as all operators are doing now.
We have a 99.8% coverage population coverage, but with 4 gs, we have 86%, and we have to continue to build out the 4 gs network, and that is why we are increasing the CapEx next year. So it will be invested in mainly in 4 gs. We have done cleaning up in the number of subscribers. We will continue to do that. We will focus less on subscriptions.
Those subscriptions have been the way to value this market historically, but that will be a change. And it will be more of you looking at revenue, of course, and the value per customer, which is, of course, a better way of measuring the market. The second brand, Halon, is improving very well and developing very well. Halon is a brand that is competing only on a fee monthly basis and not including any handsets. So it's very cheap, very without any binding, very easy to understand and very have very satisfied subscribers.
For those of you who read the Swedish newspapers, you know that we have had some problems with the customer satisfaction in Sweden. We had a new CEO in Sweden since 1 year. Actually, he's the person standing there in the lobby at our office. And he's been focusing enormously on customer satisfaction. The reason for the problems we have had is because, let's say, too tough at sales, especially from retailers.
We have a few retail chains that we have had big problems with and those cooperation with these chains have now been terminated. And we are surprised we were surprised, I should say, to see the results of the surveys that came yesterday because that is not the way the results we see in our internal surveys. We see definitely a change in the trend and that we now have more satisfied subscribers. It's also interesting to see that the result that came yesterday for consumers where we have the same we're at the same level as we were 1 year ago. We had a far better result when it comes to change the business.
We were actually absolutely at the same level Tele2 in that market. The other challenge here that is our DNA. We were first with mobile broadband, for instance. I think we were number 3 in the world in February 2007. We were first in Sweden with WiFi calling.
Tele2 and Telenoa has still not launched. We were first in Sweden with both over LTE, and that is the way we like to continue to be. We have a steady growth of subscriptions, as I said, and we have a market share of about 14%, both in number of subscriptions and in revenue in Sweden. Looking at Denmark. Denmark is a tough market.
The margins are definitely too low, and I think all 4 operators have that view. And we would definitely like to see the better result in Denmark. On the other hand, when you ask the Danish, if we prefer to compare ourselves with our competitors. And if we compare our results with the Telenor and Telia subsidiaries in Denmark, we have a far better result than they have even if we have far less subscribers. 1,200,000 subscriptions, EUR 3,200,000,000 turnover, 95% 4 gs coverage.
So we have a better coverage in Denmark, but of course, again, it's far easier to cover. We have a solid performance on a highly competitive market, as I said, and Oyster is very successful in Denmark. It's our 2nd brand. And Oyster is actually competing more in the whole all of the market in Denmark since we are only allowed to have 6 month binding compared to Sweden where Halon is only working on or competing on the market where we don't have any binding at all. Looking at the development of subscriptions.
It's about the same kind of development as we see in Sweden. And we have 15% market share in Denmark, so that is also about the same. The MVNOs are a little bit larger in Denmark than in Sweden, so that's why we have included their market shares there. How should we continue to stay alive then? Well, we have to continue to be the challenger, and we are the David against Goliath.
That is the way we view it from our point of view, looking at our competitors. We have 3 incumbents in Sweden, 3 incumbents in Denmark, and we are the only challenger in that market. And it's very important that we internally view our self being the David against Goliath independently of how big we will be. We should always view ourselves as David against Goliath So that's a very good decision to have. It's a very good easy way to also make your employees likely to fight, I believe, for bigger competitors.
Speed, it's not the big ones who went over the small ones. It's actually the fast one who went over the flow. And it is, of course, easier for us to keep a high speed heat here for us to act faster than the old incumbents. They are much bigger, they are far more employees and we are a much younger company. And speed, I think speed is the most important part for us to be able to compete.
If we are not faster than the other, we don't have a chance. And then, of course, we have to dare to be different. We can't offer the same services as our competitors. We have to be different. If we are offered the similar services as our competitors, they will change we will choose our competitors as well.
I mean, we will always go for security instead of going with the number 4 in the market. So we have to be different. And of course, we must have the most cost efficient operation in both Sweden and Denmark. Otherwise, we don't stand a chance.
From Handelsbanken. Just a couple
of questions on non Q3 perhaps, the service revenue turning negative and costs going up. Are you seeing any changes to kind of the market dynamics?
Or is it more that you're trying to respond to the kind of the surveys about the weak customer satisfaction and so forth. And Frieden, Peter responded to the weak customer satisfaction. I mean, when we I guess, new CEO started a year ago, he, of course, is looking into the implication was that we have the, 1st of all, focus on customer satisfaction, and that's what we've been doing in Sweden. We should, of course, continue to sell, that's for sure, but that is an important part of Sweden. In Denmark, it is a very tough price competition in Denmark.
And prices are going down in Denmark, and we'll continue to do so. We are still growing. We're still taking market shares, both in the number of subscriptions and also when it comes to revenue, but it will be tougher.
Have you seen any significant impact from
the change in EU regulation on your numbers? Sorry, I'll the changes to regulation regarding EU roaming, if that is Yes, of course. Yes, I should have mentioned that. Of course, the loan for makes a very big difference during Q3. Q3 is the Q1 where we don't get any revenue from the EU companies.
We only have the cost. I mean, it is a very strange situation. We have to pay for both phone calls and data usage in the EU, but we are not allowed to charge the customers. And of course, that is a net cost that we have for the first time in the Q3.
Yes. Stefano Fang, DNB. I have a couple of questions. First of all, relating to the customer satisfaction, can you mention what factors have impacted that? Is it effort quality, customer care, etcetera?
Secondly, are you losing subscribers in Sweden? Is this mainly that you lose mobile broadband subscribers? And then thirdly, you mentioned that you want to remain a mobile only operator. We just saw 3 Austria acquired fixed broadband operation from Tele2. So is it a change in sort of within the group how you view the business?
Thank you. No, Austria, to start with number 3 because that's the one that I remember first. Austria, it's not a change. What we know about I mean, it could, of course, be a change in the way Hutchison and the investor view in the market, but we don't believe in that. I also think that you have to remember that Scandinavia has been acting in another way than the rest of Europe when this comes to triple play and quadruple play.
So I don't think we will go for any fixed line in Sweden. The problems with customer satisfaction is mainly that the customers have received 2 subscriptions, 1 voice subscription and 1 broadband subscription. And we thought it was a great idea to offer these subscriptions jointly so that you could use the data you had on your broadband subscription together with your voice subscription. And thought that was a great idea. And for many subscribers, they also they agreed with that.
It is a great idea. It's just that many of the subscribers do not understand the offer. So they suddenly saw that they had 2 subscriptions, and they thought that they had only 1. And with a top seller, especially from these retail chains, then the customers' view when they see this, the invoice is that they have been cheap. And we're not talking about all of the subscribers, of course, but we are talking about the number of subscribers.
We have now proactively contacted a number of subscribers to offer them to change their subscriptions. When we see that they are not using the broadband subscription, we have offered them to change that. It will take some time. I mean, when you are when you get this bad and these customer dissatisfaction, it's very hard to change that development. But we can see in our internal surveys, as I said, that there is definitely a change in the trend.
So we are very sure that we will change this. Lower number of subscribers. The result is the same here, that when we contact these subscribers, we have 1 broadband subscription and 1 voice subscription. We offer them instead 1 voice subscription with more data. So it's easier to understand.
And that means that we are churning a broadband subscription, but you get a voice subscription with higher AMPU and higher ARPU.
Thank you. Coming back to the roaming question. Can you quantify the impact for you of this roaming issue in the Q3? And if you look at it year over year now, I guess the main impact is in the Q3 considering it's
the holiday season. But if you look to
give some guidance now going into Q4, Q1 and Q2, I guess, that should be fine, I guess, year over year, that is.
Well, we have decided to not make these numbers sufficient. I'm surprised to see that the our competitors are viewing this quite differently. I saw at least one that said that it doesn't have a big impact. It is very costly, I must say. It's we have all the 4 of us have had good revenue from these roaming.
And now we only have the cost, so of course, it has an impact. And you can see an increase of data usage in while traveling in Europe. April last year, we reduced the cost due to EU dramatically, and then we saw an increase of 4x data usage. And now if we compare with June, July this year, you can see once again an increase of some 6x compared to last year. So you had 4x last year and 6x this year.
So it's a dramatic increase in data usage.
But without saying any figures or anything like that, but is it fair to assume that you would easily have had a year over year improvement in both service revenue and EBITDA if it had not been for the room in the Q3?
Yes. We wouldn't have had a positive development of EBITDA, yes. The effect is much bigger in Sweden than in Denmark because in Denmark, we already offered raw material before this regulation. But this reason, it would have an impact.
But it's not it's just impacting EBITDA and not the service revenue or
Yes, but the impact on the service revenue is very small.
Okay, great. Thanks a lot. Thank you, Elias. Porsche, Nordea. Investo mentioned earlier how they work with their holdings in sustainability questions.
How often do you have these types of conversations with investors? And how high is sustainability on your agenda?
I guess there are 2 answers on that. 1st of all, how often do we talk to investors about it? But we are investors are looking very deeply into this. Yes, we have to work very hard to fulfill all the questions and to follow the rules of regulation. And that goes also for Hutchison actually.
So we fulfill that definitely, and we have to do it and we should do it. When it comes to the internal way of doing it, where, of course, it is very important, I would actually say, I think at least for our business, that it's more important for us internally. We have an average age of 29 years on our employees. It's very, very important for us internally to show that we are active in this area. And that means, for example, I mean, we are using a lot of electricity in our base station, and we are have seen one since 1 year that we have only green electricity, and we are doing a lot of things like that.
It is very, very important internally. We are focusing a lot on it. And first, I mean, my opinion, I mean, you can see I'm more than 60 years old. First of all, 1st, I, of course, support that this is only a sharper landline. Why should we bother someone else to do that?
The Fiat material or someone else. But now I realize that this is quite fun and it's we can do a lot of things better and we can really be a part of the society. And I think that's great. We are very active, for example, also in EKTA, the organization working with special harassment for children. And I'm personally active there and also the whole company.
And we think that, that is important.
Okay. Before I thank you, Peter, should we hear if there are any final questions from the web?
At this point, there are
no questions on the phone.
Okay. Then, yes, a big thank you, Peter, for coming and sharing this. Let's give Peter a big hand. And that's it.