Telia Company AB (publ) (STO:TELIA)

Earnings Call: Q4 2020

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Jan 29, 2021

Humble to the challenge, proud of our contribution, and always confident of our success. Bringing the world closer, we are Telia. Good morning, everyone, and welcome to a quite snowy Friday morning here in the Thiele company head office in Solna. We will today not only take you through the Q4 report and the full year results, but also take you through an updated strategy and and the financial ambitions that we have for the coming years. And of course, maybe needless to say, we would have really liked to have you here with us. But as you know, unfortunately, we can't, but we really hope to see you here next time. And meanwhile, we hope that you're all both you and your near and dear ones. So here is the agenda for the day. It will be 2 or 3 different sort of sections. We will have some leg stretchers and breathing in between. The times are preliminary. So bear with me. I hope that they are more correct than the working capital guidance I have given you throughout 2020. We have I have with me on proper social distance, our President and CEO, Alison Kirkby. I have our CFO, Per Christian Merland and our COO, Rainer Deutschmann. And they will walk you through this like a relay basically. And we start with Alison that will take you through the Q4 numbers. So I hand over to you, Alison. Thank you, Andreas, and good morning, everyone, and let's get started. So thanks for joining today. We'll, as Andreas said, 1st focus on the 4th quarter results, which as you saw was slightly better than expected with a somewhat better trend on service revenues, especially within our Enterprise segment and also within our TV Media business. Reported service revenues grew by 4%. As we if you recall, we only closed the Bonior transaction in December last year. But on a like for like basis, we saw service revenues decline just over 2.1%, but sequentially better than the 4.8% drop we saw in the last quarter. And if you now exclude COVID, we were basically flat in the quarter. Within revenue, mobile subscription revenues fell by 1.1% and excluding the roaming impacts, we're actually up 2.1% and again, a sequential improvement versus Q3 when we were up around 1.5%. EBITDA declined minus 6.6%, very much driven by the COVID impacts of which that was around CHF 200,000,000 We also had no positive benefits from pension this year. And as we said already in the Q3, we made some deliberate investments into marketing and call center staffing in the quarter. So excluding COVID and pension impacts, EBITDA declined 3%. EBITDA less CapEx fell 18.6%, driven by the lower EBITDA and to some extent also CapEx growing as we now start to invest in 5 gs rollout and in the modernization of our networks. We've clearly already preannounced the operational free cash flow of CHF 12,100,000,000 driven by the aforementioned results but also by working capital. So net net, considering the headwinds we faced at the beginning of this year, I'm proud of the resilience and the recovery that we've seen since then. However, since our last update, the 2nd wave of the pandemic has clearly accelerated with increased restrictions and lockdowns, and we are also seeing that impact our footprint. We now have around 85% to 90% of our workforce now working from home again, with store closures in Denmark, Lithuania and the Oslo area since last week. Considering this context, our business is still very solid and strong. And as I said, I was particularly happy with the strong performance in the enterprise segment, especially in Sweden, Finland and Norway. Our customers are rewarding us for offering a broad range of digital services, everything from connectivity to IT services and IoT. And although we're not out of the woods and we have the deepest respect for how the ongoing pandemic may impact especially smaller enterprises. We are encouraged that our convergence strategy, underpinned by our trusted, secure, safe and reliable infrastructure, is in demand for enterprises large and small. TV and Media continued to show real sequential improvement as our superior reach and range of content drove both our linear and SVOD revenues. We added 142,000 SVOD customers in the quarter as they increasingly become part of our bundled offers. And on the linear TV side, the TV4 group in Sweden saw an all time high share of viewing. At above 35%, we're at the highest level since statistics started to be published back in 1994 and our Head of TV Media, Kasdan, probably had hair back then as well. When looking at the commercial share of viewing, TV4 also increased its share by 4 percentage points year on year to above 51%. And we also increased commercial share of voice in Finland by 1.4 percentage points year on year. Very encouragingly for the long term, this is also the case for the AVOD side, where stream time increased by 32%, clearly outperforming the market leading digital play service. A key reason for the resilience we've shown in the quarter the full year is the importance of delivering secure, reliable and high performing connectivity solutions. We are very proud to once again, for the 4th consecutive year, come out top in Sweden when it comes to mobile network quality. And as we just last week also secured the largest block in the most attractive part of the 5 gs spectrum expand our portfolio and expand our business. We look forward to further leveraging our leading position by rapidly offering high speed, high capacity and low latency 5 gs services for our customers, and more to come on that later. We're also progressing very well in rollout of 5 gs in Finland, reaching population coverage of around 40%. And in Norway, we've added the city of Bergen in the quarter and now have around 70% to 80% population coverage in the centers of all the largest cities in Norway. However, it's perhaps Finland is the country where we've had the most experience from 5 gs. And as such, it's encouraging that we do see customers migrating up to 5 gs tariffs and willing to pay a premium of around €3 per month versus average levels. We have high ambitions to be much better when it comes to customer experience. The pandemic has, however, put pressure on our call centers as well as reducing traffic to our stores. And we do not yet have the online or digital user experiences our customers deserve. This has resulted in, and as we expected, higher costs for customer support in the quarter, but this is a key area that will be addressed in our customer experience led transformation that we will share details with you later. So having closed the year and with a better outlook for the coming years, our board will propose a dividend of SEK 2 per share for 2020, a level that is consistent with the structural elements of our cash generation during the past year and the proposed new minimum level or floor for the coming years. So let's go briefly look at the countries. 1st, Sweden. Service revenues improved sequentially, supported by a slightly lower impact from COVID, but also a better development in both mobile and fixed. And as I said, especially the public and key enterprise segment from both connectivity and great progress in combining that connectivity with IT Services. Yes, EBITDA is down versus a very tough comp last year, I've already touched on the reasons higher marketing, higher customer support costs. From an operational perspective, yes, the development was slightly mixed with good intake on mobile and TV, but a deterioration of broadband subscriptions as we didn't quite manage to set the underlying legacy copper line losses with fiber in this quarter, but we've got plans for that going forward. Finland also in Finland, revenue development did improve this quarter, driven rather equally by improved performance in Consumer and Enterprise, with the enterprise segment showing growth, even including COVID effects. Continuous steady growth in IT but also a more stable telco business were the drivers. The lack of roaming overall and lower revenues from TV and fiber installations explain why service revenues though still declined. EBITDA declined due to a weaker revenue mix. As we all know, IT revenues do come with a lower margin, and we did have a higher equipment margin in this same period last year. Subscriber development does look poor, but it's partly explained by a clean out in the B2B segment, the situation in consumer is more stable, which is really highly encouraging, As is the growing ARPU from what I said, migrations to 5 gs, and that is also really happening in the consumer segment, which is offsetting some price pressure in the B2B segment but still allowing average and blended ARPUs to grow during the quarter. TV KPIs are impacted by the move of Liga to the TV and Media Unit, as is the ARPU, but we also have a higher share of lower ARPU contracts such as collective agreements in the base. In Norway, service revenues fell by 2%, which was clearly better than in the 3rd quarter due to our solid mobile improvement, which fell by 0.6% versus almost the 5% that we saw in the Q3. On the fixed side, we do continue to struggle as TV revenues decline more than our broadband revenues grow, But broadband had good subscriber base development as well as increased traction for fixed wireless access where we reached 14,000 customers in the quarter. And with the recent price increase, we do have a good runway into 2021 on our broadband business. The TV ARPU is diluted there from having a larger share of subscriber base from MDUs rather than SDUs. Finally, on the B2B segment, I'm happy that we, in addition just showing a 0.6% growth for the quarter also secured several new good contracts, including one with the Norwegian police, just showing the real quality perception that we're starting to build with one of the most challenging customers you can have in any market. On EBITDA, we grew by 12% from strong efficiency realization and partly also from having an easy comp last year. We now have 5 gs coverage in Oslo, Trondheim and Bergen and a clear plan where to roll out additional coverage during 2021. Roughly, we now cover 90% of the population in Central Oslo and are very happy to actually be the daring challenger when it comes to rolling out 5 gs faster than our competition. The mobile subscriber shown here, it is explained by impacts from an earlier loss of a large public sector customer. Underlying, the development was supported by a continued good traction for the Telia X Unlimited offering that now exceeds 100,000 subscriptions, with the churn on these customers also at just over 10%. The lead markets, our smaller markets, had a solid end to the year, particularly in the Baltics, with Lithuania and Estonia showing relatively stable service revenue. Both countries also managed to grow EBITDA despite their lower revenues through continued excellent cost control. In Denmark, the revenue pressure remained, especially from loss of roaming, but also good cost control as we to refocus that business into becoming a much more lean, mean, digital, agile mobile operator. And the cost control was good at mitigating a large part of the revenue decline. We've covered most of TV Media already, but I just want to highlight the sequential improvement that we're seeing on service revenues. Yes, ad revenues were still down by 7% in the quarter, but it is an improvement from 32% in Q2 and 13% in Q3. We also saw a sequential improvement within the quarter, ending the year down by 5% in December. The EBITDA reduction is driven partly by content phasing from previous quarters such as Formula 1 and from investing in new content, which has clearly helped drive the record high viewership consumption and the growth in Seymour, our SVOD service. With the recovery from COVID starting, all time high viewership and streaming, all major sports rights secured all the way through to 2023, an all major distribution agreement secured all the way through to 2023. We can really now focus on realizing our original ambitions of the Bonaire acquisition to drive convergence and to build a deeper, more engaging and experiential relationship with our customers so that we can become the hub for all their entertainment and connectivity needs going forward. Very quickly on the financials. Flattish revenues ex COVID with mobile and broadband revenues actually even showing a slight growth. On EBITDA, as I said, we saw a 6.6 percent decline as a strong performance in Norway was more than offset by lower EBITDA in mainly Sweden and in TV Media, but they were very tough comps last year and that decline is shared equally between Sweden and TV and Media. On cash flow, we've touched on this a lot over the last 10 days, but clearly, the outperformance was predominantly driven by a GBP 2,300,000,000 contribution from working capital. And having spoken too much about working capital last quarter, I've now delegated the working capital conversation to PC going forward, and he'll give you some more perspectives on where we see working capital as we go into our midterm plan and outlook. And just to say, it will still be a contribution in 2021. In terms of debt and leverage, unchanged financial leverage and a slight decline in net debt, the strong cash flow generation and Turkcell proceeds funded our increased CapEx and the dividend distributions that we made in the quarter. Pro form a leverage now is expected to be around 2.32x if you include the proceeds from the Carrier transaction, which we are on track to close during the Q2 of 2021. So closing out the year and looking back at my first and made good progress on much of the immediate priorities that I set out. As well as exiting Turkey and the Global Carrier Business, finally allowing us to focus on the Nordics and the Baltics, we have delivered on our financial ambitions for the year and even delivered a little bit more than we dared to imagine at the start of the pandemic, especially in our most impacted TV and Media business. Throughout the pandemic, we've been supporting the very core of our societies by keeping people, businesses and societies connected, informed, entertained and something I and my colleagues throughout Telia take great pride in. On connectivity, we've taken major leaps forward during the year into a world of 5 gs, having both secured important spectrum and strategic vendors that cater for us staying at the very forefront of the technological developments that will arise and ensure the Nordics and the Baltics have the highest quality, the safest and most trusted networks. On convergence, we've made gradual progress, and we're seeing a continued growing share of customers on converged offerings. On the cost side, yes, we have made some progress, but there is much more to do in terms of customer experience, process and product simplification, IT modernization and in rightsizing the structure of Telia to be competitive for the future. By that, myself, PC and Rainer are happy to take you through how we, the new leadership of Telia, are about to do just that in the coming years. But since we are both a communications provider and an entertainment company, we're going to have a brief commercial break so that you can top up your coffee cups. Welcome back. So during the last 8 months, we've undertaken a deep review of Telia's strengths, weaknesses, opportunities, threats and full potential. At the same time, we've engaged all of our employees our most important stakeholders in our purpose, why we exist and how our unique character and spirit can drive and define the next decade for Telia. What we've seen is that the most successful, modern, innovative communication providers have clarity in purpose and strategy. They have highly engaged employees who are deeply passionate about their customers. They are service, not just product oriented. They have become true digital telcos in their operations and at every touch point. They're highly analytical and data driven. They have built a lean and agile delivery machine. They have strategy to execution as a muscle that allows them to deliver consistently and sustainably. They recognize the untapped value in their critical national infrastructure. And they are taking advantage of the massive disruption that surrounds them, whether it be from new technologies or new competition, but also from the acceleration of digitalization that is occurring as a result of the pandemic. And they're embracing all of that to reinvent themselves. It's with these insights that I've gathered a new leadership team to take Telia forward in this new chapter and why today, alongside the usual me, PC and Andreas, we have in particular, Rainer Deutschmann, our COO, presenting. Because if anyone understands clearly would have loved for you to meet the whole team today. But until we can meet in person, I decided the 3 of us for 3 hours on a Friday afternoon was more than enough for now. Let me start by saying what a privilege it is to lead a business like Telia in what is one of the most digitally advanced regions on the planet. As you heard in the video, we like to call it the cradle of digital given the unique history in this region. The people here have embraced mobile telephony. In fact, we at Telia launched the world's first mobile network, 1 gs, in 1956. They have consistently embraced fixed and mobile broadband, streamed music and video, shopped online. Even my husband's Swedish 103 year old grandmother in Gothenburg learnt to shop online at the start of the pandemic. They have embraced connected transport, smart homes, all of the smart city, connected stuff you can imagine it's all been embraced here faster than other parts of Europe and faster than many other parts of the world. The pace of change means that we are now living highly connected lives. Connectivity has become part of the very fiber of life. This is clear in the fact that the traffic on our networks is doubling every 2 years. The high standard of living with a focus on health, well-being and sustainability, combined with our leadership in connectivity and digitalization, has been a part of making our region resilient and able to weather the various economic cycles better than other parts of the world. And already it's predicted that our region will recover from the pandemic faster than others. Ease of doing business gives us confidence that all industries and enterprises, whether they be public or private, will be able to But not only do we operate in a great part of the world, we also live in exciting times. Here are some of the current trends we observe, which reinforces the opportunities ahead for Telia. With new technologies becoming more established, whether it be 5 gs, IoT, Cloud, in combination with the pandemic drastically accelerating the need for digital transformation, enterprises and consumers alike what a trusted partner to help them embrace the possibilities new technologies offer, be it for a smart home, a smart building our storage in the cloud. We believe that we are the trusted partner that can help our customers digitalize. Businesses and consumers alike are now more than ever before establishing new ways of working, interacting, socializing through a combination of digital and physical forums from a variety of locations. And the way we can see media is clearly changing dramatically towards streaming. Ecosystem development from Google, Microsoft, Amazon and others are playing an increasing role. Never before have sector and value chain borders been more diluted and we now operate in an increasingly open and diverse ecosystem, creating an abundance of choice for our customers. We believe that customers want a one stop shop, an aggregator that simplifies and provides services they want and needed in a trusted, secure and customer based manner. Security concerns, increased digitalization clearly brings increased cybersecurity, data privacy risks. Only Telia can provide certain integrated security services based on our infrastructure and our heritage. Finally, customer experience and personalization is increasingly the differentiator that allows you to retain, grow and gain customers. To create value. We believe, therefore, that we are uniquely placed to become the leading purpose driven digital telco in Europe. As a regional pioneer, we've been shaping the way society functions over 2 centuries, And we've done so with a deep conscience to ensure digital inclusion in all its forms and with a drive to help society realize a more sustainable future. And moving forward, Telia will continue to lead from the front. Becoming an active orchestrator of connected living, from thinking product first to thinking customer first, from leading the past to being a model for the future, from incumbent comfort to an agility to execute, from invisible to iconic. A lot of this comes down to us being much more customer focused, thinking and acting like a modern digital company, fast, agile, nimble, easy to deal with and with the access point to everything a digital world can offer. It requires us to be much better for all our stakeholders. It requires us to reinvent ourselves. And this is what's going to be different about Telia going forward. It starts with our new purpose, to reinvent better connected living. This means better connected customers empowered to live fuller lives, better connected businesses working smarter, better connected teams working all towards the same one goal a better connected society in which people and the planet prosper together. Living, as you can see, and we know comes in many forms, our impact across entertainment, health care, transportation, education and more. Reinventing is how we will deliver better Connect Living. Innovating constantly, challenging ourselves to do better for ourselves, for our customers, for our owners and for the societies of our region. And at the core of our purpose is the need to be more customer focused, to understand what better connected really means to people and then ensuring we deliver on this in our services. So our purpose is our new North Star and our strategy, the road map to deliver on it. This is our strategy, and today is about unpacking that strategy for you so that you can all understand how our customers and our shareholders in particular will be rewarded by Telia's plan to reinvent better connected living. Our strategy starts with the where we will reinvent better connected living through the combination of our digital connectivity, our digital experiences and our digital infrastructure. Underpinning the digital lives our customers want to live is clearly connectivity. In connectivity, we do have a clear position of strength. We have the largest and the most multi award winning networks across our footprint. Connectivity is our core business and even in COVID times, when losing around DKK 1,000,000,000 in roaming revenues, it has been exceptionally resilient from both a customer experience and a financial perspective. And it has proven itself more than ever to be the fibre of life. And as we look forward, we intend to remain at the forefront of new technologies and the new innovations that will be enabled through 5 gs, fiber and whatever comes next. And Rainer will explain more on this later. Beyond connectivity, we can uniquely become the hub, the curator, the orchestrator of all the digital experiences an individual or a household needs to live a better connected life. Investments in recent years really have given us a relevant portfolio of experiences to help people connect, be entertained, be informed, safe and organized. And here is a few examples. Smart Family is our fast growing mobile app for families to manage their busy lives in a privacy safe way. We even have a high usage among our competitors' subscribers. The Dot is our digital only subscription in Finland, delivering a superior user experience. Esports, we've now launched Telia Esports League across the Nordic countries and last year saw a 6 fold growth in Watch Minutes. And Smart Wi Fi is building on the strong base of managed routers and as a great enabler for everybody working from home these days. We are also increasingly the digitalization partner of choice for better connected enterprises, helping businesses operate securely, become more data driven and serve their customers in a smarter way. A few ways we are doing this include the ACE contact center solution, which includes our AI driven chatbot that can be trained to support each customer's unique requirements. Telia now boasts a comprehensive suite of security services from identity management to denial of service protection and has unique services to block scam calls on our mobile networks. And as you know, I've been extremely proud to see the value of Telia's crowd insights during the pandemic, which has helped health authorities and municipalities assess and access mobility patterns. The service uses aggregated and irreversibly anonymized movement data from our mobile networks supports better data driven decision making with multiple uses, for example, by cities, retailers, public transport, out of home media and more, a clear opportunity for further monetization going forward. Now, as those of you who have followed us for a while know, we today have a significant footprint of towers, sites and fibre across our markets. And we have just today also confirmed the expansion of our partnership with D and A in Finland for further shared network coverage in Finland. To crystallize and grow the value of our infrastructure assets, we have today announced the plan to create a new business unit, Telia asset management that will own and manage selected assets, opening up the opportunity to bring in external investors accelerate infrastructure development further. We have for some time been preparing for this and identifying such assets within our portfolio and where a special focus has been on towers, in particular in the markets where we act as a challenger, Finland and Norway. And we are now proactively identifying the relevant partners that could join us in this journey and we'll be coming back to you on that very soon. It's the intention for Andreas Ekstrom, who you all know well to oversee this unit alongside his M and A responsibilities. So, so far, we've talked about our purpose and where our growth will come from. Now let's look at the how. Enabling our growth strategy are 4 key pillars where we will excel relative to our peers. They are inspiring our customers, connecting everyone, transforming to digital and delivering sustainably. So let's take a quick look at each one in turn. Our first pillar is all about inspiring our customers. And we start from a clear position of strength to grow beyond connectivity with the leading customer base of 24,000,000 subscribers across the high value and still growing Nordic and Baltic markets. We're also the leading Nordic media house with a recovery path post COVID which is faster than we expected back in March April last year. Our investments in ICT have made us the market leader in Baltic, Sweden and Finland, and we're already NPS leaders in several segments and markets in Sweden and Baltics. This foundation, together with the technology shifts, is a great platform for growth. Combining engaging services and best in class customer experience will give us several growth and value levers. Listening to and providing for all customer needs will cement our convergence leadership, allowing us to further differentiate our brands and support premium pricing. And unquestionably, there are opportunities to develop the TV and Media business to its full potential. So the key takeaway you should note is that we will drive a strong value accretive commercial agenda, enabling growth across all of our markets in the coming years. And as I said, we're starting from a strong position, market leadership in multiple segments throughout our focused footprint and opportunity for growth in our Challenger markets and in our markets with structural opportunity going forward, an excellent basis for value creation through cross selling. But it all starts with the customer and a great experience based on a great portfolio of relevant products, that's the basis for quality positioning and price premium. Customers now expect seamless and digital journeys with personalization, and we can do that as we further digitalize the information that we have throughout Telia to bring individual needs to the fore even better. And while stating the obvious, it's worth repeating that there is a clear relation between user experience, loyalty and value creation. The most successful global brands are our example for using a quality positioning to increase customer lifetime value. In short, we plan to monetize our network leadership and strong customer base by accessing and using deeper consumer insights to deliver the most relevant portfolio to each and every customer across mobile, media, broadband and the further applications that are developing. We are already making good progress here. Swedish convergence offer, for example, is clearly resonating. We've now got more than 300,000 Telia Life customers. Also, our Baltics Telia 1 propositions are proving our loyalty cross sell beliefs. So going forward, we'll continue to monetize 5 gs. For example, we're already seeing it in Finland through speed tiering, and we'll continue to expand our value added services following a clear more for more approach. And we will leverage our own fiber footprint access others' networks to drive enhanced quality and premium pricing. So let's pick up on a key priority area of convergence. And I must say it's getting a little bit hot in here, so I'll just take a drink of water. Convergence. Yes, we have launched convergence across nearly all our markets, and we're already seeing positive effects such as reduced churn and increased NPS. In Sweden, we've seen 70% growth in convergent households And that's translated into 60% lower churn compared to mobile only customers. But we've not done enough yet, And I know we've been talking about this for a while, but clearly, we haven't done enough to exploit the full opportunity as we are still lagging our peers in other markets that have driven convergence in a more for more value accretive way. We're redesigning our sales processes towards growing at a steady and, as I said, value accretive pace towards our European peers. Moving over to enterprise now. This is a segment where we believe in longer term growth on the back of 5 gs, fiber and digitalization. We are very well positioned through our network leadership coupled with our ICT services, and we're increasingly the trusted digitalization partner of choice, particularly for the public and key partners. On top of connectivity, we push horizontal ICT solutions, protecting and enhancing our core business, and I'll say more about that in a second. Moreover, our footprint and international credibility give us a great opportunity to serve multinational customers based here in the Nordics and the Baltics. That same footprint and market access also allows us to build strong partnerships with globally scaling players. We're also taking a different approach to truly leverage a strong international commercial agenda, building a setup where we align our countries to speak with one voice to utilize group synergies. And as I said in the B2B segment, the direction is towards ICT. Our strong market position allows us to benefit from continuous market growth in cloud security and unified communication and collaboration. Going forward, we aim to be the leading aggregator, a hub that curates ICT services for customers with professional service management across the entire portfolio. Not all of our ICT services are produced in house, but rather integrated from strategic partners, allowing us to continuously benefit from their global scale and rapid development. And by being the curator or the trusted ICT advisor for all segments, we become more relevant to our customers, thereby increasing our share of wallet, reducing churn and price pressure and establishing customer longevity and customer lifetime value. And finally, Media. Beside the convergence benefits from owning media assets, we will also develop TV and media stand alone to its full potential. We see both a solid business with a strong ad segment recovering quickly from COVID and an SVOD segment with substantial growth. And we have multiple growth levers for both. Within ad, by maintaining our market leading reach by combining linear with the rapidly growing digital ad inventory. Our plan is to more than double digital ad sales by 2025 by leveraging our strong and digital consumption growth and adding new analytics based advertising concepts, growing faster than the market. In SVOD, we will continue growing our subscriber base, both organically and through attractive content with access offerings. We really do have a unique position in the market with great SVOD content and services and the only player with an ability to cross sell them to their mobile, broadband and TV customer base. And we're thrilled to have secured both the Swedish Hockey and UEFA Champions League, which gives us 2 of the 3 most popular rights in Sweden, and we have 3 of the top 4 most popular rights in Finland. We already know that bundling access with content brings benefits based on the experience we had in the summer with our Swedish bundles. So on that note, I'm going to pass over to PC because I've spoken a lot about what we're going to do for our customers and our business in the pillar of inspiring customers. But I'm sure you want to see some numbers behind this strategy. So PC is going to take you through the multiple levers for growth that we see by better inspiring our customers so that you can start to get a feel for where we see that potential for growth going forward. P. C, over to you. Thank you, Alison. Let me see. I will quickly summarize the revenue implication of the agenda that Alison just presented to you. Very briefly, we will leverage our 5 gs rollout, our digital services, including our media assets, But also an improved customer experience with the more for more approach to lift up ARPU across mobile and fixed and across our consumers and enterprises. We will leverage our convergence agenda to further reduce churn, improve net add through cross sell and up sell and also improve the revenue per account by adding more services to the households and to the businesses. On the 3rd pillar, we will also add revenues from new offerings, especially within the enterprise segment, both adding specific new revenue streams, but also a very important part of supporting our overall Enterprise Connectivity business. In addition, we have, over the last few years, faced quite heavy headwinds. In 2016, 14% of our total revenues were linked to fiber OTC, Telephony, fixed telephony, interconnect and roaming. In 2020, that percentage is reduced to 7%. And as you can see in the middle of this slide is that going forward, we expect these revenues to gradually come down From SEK 1,000,000,000 in 2019 to around SEK 200,000,000 is what we expect in 2023. In addition, COVID really is accelerating the sort of digital and online A piece where Telia is really well positioned. At the same time, as Alison has alluded to, we have a big service revenue impact in 2020, We saw a €2,000,000,000 negative impact from roaming, advertising revenues and also pay TV revenues. We expect this to gradually improve during the period. And if the effects fully recover by 2023, that alone will be 1 percentage point annual growth on our revenues. So putting these things together, Easing legacy and regulatory pressure, recovering COVID revenues, Kind of neutralizing each other, and then we're going to get some growth from monetizing our 5 gs rollout and improved customer experience to increase ARPU, reduce churn by leveraging the convergence agenda, but also add some new revenues from the enterprise services that we talked about. All in all, that should give you comfort that we should be able to grow lowtomidlow single digit growth every year in this period. So with that, I'm wrapping up the Inspire part of our strategy. We will now move over to Connect and to transform, where we cover our network capabilities and our agenda to really transform Telia into a true digital company. And by that, I hand over to you, Rainer, to take us through. Thank you, P. C. So now we go into the 2nd pillar of our strategy, how we connect everyone with the most reliable, trusted and efficient model networks. So let's look at our starting point. We have a clear leadership in our network position, in network quality, which is the coverage, which is the speed, the latency. We have launched 5 gs across all our countries. We have been first with fixed wireless access. We have the best 4 gs networks in Sweden, Lithuania, Estonia, and we are in par in the other markets. And we have close to 3,000,000 homes connected today with fiber and high speed Internet. 5 gs rollout is in full motion based on a fully standardized A set of type site types, which I'm coming to in a second. That is, of course, with our strong partnerships, Nokia and Ericsson, that we have communicated earlier on. This all is based on a common virtualized core network, which we have already implemented. And again, I'll be coming to this in a while. And we look at the legacy shutdown, which is well underway. And again, I'll be detailing more on this In the next slides. So what we're going to be doing is on the connectivity pillar here is we look at the value creation levers from the access part, where we are looking at the further rollout of the gigabit networks that we have today. 2nd, we look at the underlying software based networks, what we call what is the future of the transport, what is the future of the core networks and how does it benefit our customers and our economics. And third, we are going to be looking a bit deeper into the legacy drive out, Which again unlocks potential in terms of efficiencies and also customer experience. The partner approach where we want to further strengthen our investments the value Alison has already alluded to, which I'm not going to be touching on again. So let's look at the access part and start with the mobile networks. As you can see and as you may know, we have a very, very strong position today. Looking at 4 gs, close to the entire Population in our footprint is covered with strong 4 gs networks. And we have both from the customers as well as From the independent certifications, a clear mirror that we are having the best networks. Sweden, not only 4th time in a row best in Sweden, but even across Europe, the Swedish network is considered to be the best. Also, we are in a very good position Even in our Challenger markets where, of course, the investments are diligently steered. Now on top of the 4 gs network, we are In full motion and drive the 5 gs rollout. And as you can see the numbers here, we are looking at 90 ish and above Population coverage in our markets in 2023 and across the markets we already are, of course, in full motion on the 700 as well as on the 3.5 gigahertz frequencies. And I think the unique position that we have as Telia, which may be a bit different from other Telco groups that you may know, we have for the first time fully standardized the 5 gs network that we are rolling out. That means we have really reduce the number of different variants that are there into actually 3 for the urban, for the suburban and for the rural coverage. This gives us scale and this gives us also the efficiency and the operational benefits of managing a much less complex network. In addition, the way how we do this is that we can dynamically steer the traffic and the way how we serve the customers between 4 gs and 5 Because our modernization is touching the 4 and the 5 gs network at the same time, giving us an adaptability according to the traffic demands that we see in our markets, Which is extremely efficient and helps to get down the cost per GB, which is the core KPI that we look at in terms of production cost. On these mobile networks, I wanted to point out a specific set of installations, which you may have heard of, fueling the Industry 4.0 economy that we have in our markets, where industries like manufacturing and and others are completely transformed and put on a new level. So what you can see here is an example of Boliden, which is, I think, the world's Leading mining company in terms of productivity, and we have been quite honored to support Boliden as a customer, as some quite other customers that we have in the market with an enterprise mobile network. Now what is this? This is a dedicated installation of our network Covering the RAN, the access part, as well as covering the core and the transport part. And the benefits of such an installation is that you have a further increased quality of service redundancy, resiliency, capacity, 20 fourseven monitoring, of course, extra security in terms of enterprise specific APNs. And as a customer, I'm gaining the platform for further use cases such as IoT, such as connected to the Edge Cloud and any of the Industry 4.0 use cases, especially in connection with AI. So we have designed, we have deployed and we are operating commercially multiple number of these enterprise mobile networks and we have in fact industrialized one part you have the core and the access dedicated. The second product that we have is The access is dedicated and the core is shared and this is a great platform for growth for our enterprise customers. Talking about IoT as another major growth area and an area of significant attention from our enterprise customers, We see not only a healthy growth on the connectivity side where we see the active SIMs growing by 14% year on year, But we see especially interesting for us and for our customers the value added services on top of the connectivity. And here the growth is even much larger with 62% year on year, which has brought us already to a position where 40% of the revenue mix that we have in the IoT space is beyond connectivity to the point of experiences that Alison made before. Now switching from the mobile to the broadband, the high speed broadband side. Here we have A strong hold in our fixed broadband networks with connecting today 2,900,000 households In a very, very high speed manner across our markets. And we, of course, drive further growth in a very value Driven rollout where we see the demand, we will look at the rollout. In addition to the fixed fiber, We have seen a quite outstanding growth on the fixed wireless side. Fixed wireless means fixed experience on a mobile network. This is deployed in 4 gs across the markets and we have started to deploy across the markets also in 5 gs. And we have today A situation where we connect 250,000 households already with a high speed fixed wireless access and we see significant growth going forward both on 4 gs and now especially also in 5 gs use cases where you really get a true and quality of service, a fixed asset, a fixed connectivity for all the home all the office applications that our customers want to use. Now below the surface of the access networks, the mobile and the fixed access networks, we have a significant transformation going on, on the transport, on the core and on the service orchestration. Just to highlight a few of these elements, we have already virtualized our core completely. Across Telia, there is one single core network, which is with our partner, VMware, virtualized. And we are completing, by the end of the year, the complete Migration of all the traffic to the virtualized core, which will unlock significant potential for the drive out of legacy platforms, which I'm coming to in a In addition to the core, we have also quite on the we have been on the forefront of changing the way how transport aggregation And services are connected where we have actually separated service from transport, which gives a lot more efficiency and which gives us a way to much faster deploy services run the workloads in our network. And all of this is connected through a service orchestration, which allows us to much faster deploy certain network functions. And as we say on the benefit side, also deploy customer installations in a lot faster way. So what is the output of the Softwareization of networks here, even better quality, less downtime because we can apply software methodology here, less defects, much faster speed of deployment for network functions as well as for customer installations. We also get new features because we are looking at software now. We are looking at APIs. We have the opportunity to open APIs to partners and customers, and that is a complete new way of how we can monetize our networks in an open way. Last but not least, of course, cost savings from automation and from driving our legacy, Which is my next point. As you know, if you look at legacy, we have been talking about the copper takedown in Sweden. We are well underway with the copper takedown. We have converted and driven out more than half of the areas today. We are looking at a complete dry award by 2026. We are looking at a good migration of customers from the legacy product Into fibre from the legacy product into also the fixed wireless, giving a better experience and giving us an opportunity for better monetization. In addition, of course, needless to say, the copper legacy takeout will lead to cost savings. We are looking at above SEK 100,000,000 per year drive out of cost and terminal, once we have taken it down completely, another about €500,000,000 coming from the legacy drive out on the legacy fixed side. Legacy also is on mobile. Generations come after generations. Once 3 gs was new, now it's the legacy. We are driving our 3 gs significantly. And I'm happy to share today, I think for the first time, that we have further accelerated our 3 gs shutdown plans, Originally looking at 2024 and 2025, now we have the clear ambition to drive out 3 gs of our networks across the footprint by the end of 2023. And what you see here is the proof point. The VoLTE traffic, which is the voice over LTE, new voice generated traffic Is increasing and taking the full share, while the 3 gs traffic is significantly going down, giving the customer a lot better voice quality and experience and giving us the opportunity to finally take down the 3 gs networks and realize the savings and especially also be able to refarm the spectrum into 4 gs as well. And last but not least, on the right side, you see how we are driving the legacy takeout under network service nodes. This is now enabled and connected to the softwareization of the core network and the transport network that I was alluding to earlier. We have already taken out about 30% of the notes and we are clearly determined to take out the entire legacy on the network side by the end of 'twenty three as well. And you see that acceleration, which is again fueled by the fact that we have the softwareization of our network now in place and we can do that. That completes the connectivity part. So before Rainer continues with his session, we will again go for a short break. So get up, stretch your legs, get a cup of coffee or look at this short little movie, short little film That shows exactly how connectivity that Rainer just talked about has helped to improve the work life balance of the good people of Norway. Welcome back. Let's go to the 3rd pillar of our strategy, transforming our company to digital. Now the digital telco is at the heart of what we want to become as the new Talia, what is a digital telco? It is driven by customer experience. It is delivering digital and highly valued products by our customers. It is based on simple, automated, smart processes. It is based on insights and the value from data which can be used for customer experience for commercial benefit. And it is based on a lean and an efficient IT which supports the customer experiences and the commercial agenda. And that is exactly what we are looking at to transform into. When we started our transformation program In the Q4 last year, we have started with a fairly radical assessment of our starting point. Transparency always is the precondition for improvement. So we have been fairly transparent to ourselves and I want to be transparent to all of you as well. First, we see that past initiatives which have been communicated about have been in part unsuccessful and we believe because they have been too narrow in focus And they have been, in part, too technology oriented, while we are now, as Alison was saying, driving our transformation Coming from the customer experience, that practically means we are saying what do we need to deliver enticing experiences Along the customer journey, what are the technology capabilities that are required in order to deliver those experiences and what does it mean for the processes, what does it mean for the analytics and what does it mean for the IT. We also have seen that we have A number of legacy products that actually don't hardly deliver any economic benefit, but they are implying a lot of legacy cost in the IT in our systems and that needs to be tracked. We have complex and manual processes today, very little digitization, which is a big opportunity for process simplification, digitization, automation and scaling across the group. We haven't yet really unlocked the value from data and from insights today, which again leads us to implementation of what we call a pervasive data driven organization where we can take decisions based on data that are right and that are real time. And last but not least, we have seen a highly complex IT landscape today, which has accumulated a fair amount of technical debt over time With acquisitions and with organic growth, this kind of complexity has started to drag us down. So we have embarked already on a massive IT transformation program across Telia, which will deliver a future proof and lean IT as a business enabler. And I'm going to be now spending a few minutes on going through the 4 key value levers that we have defined: products, processes, analytics and IT. I start with the product portfolio. Now, where we are today, We have a number of legacy products. Actually, we are looking at multiple 1,000 of legacy products. We have An overlapping product portfolio today, which is confusing to the customer and which obviously means that we are not leveraging the scale Of a single product which is then delivered to the markets. What we are doing here is we are running now a radical product portfolio cleansing exercise. We are decommissioning at least 50% of our products And this will unlock massive IT efficiencies because, as I said, all the products need to be supported by IT systems and even also people. And those ones, We can redeploy for the future product portfolio. We have defined the future product portfolio. Largely, there's a connectivity and there's an experience part. There's a B2C, there's a B2B part. So we are very focused on the future product portfolio and we will deliver on this product portfolio a high NPS, a market leading NPS, we are committed to this. We also have quite many bespoke product implementations today Which are not scalable. And we are massively changing now the architecture of how we are building and deploying products into what I call product as a platform, which means the commercial leadership in the countries can take the product as a platform and just configure the price, configure the promotion and sell it standalone or sell it as a bundle and this will enable a much faster time to market and a lot more opportunity for monetization. And last but not least, we do have gaps in the customer journey today. We have also, in some of the products, not even full visibility of the customer experience on these products. And we will change this so that we get market leading products, again measured by the NPS, And we will install and we are well underway of our customer centric service management that doesn't look at systems, But looks at the customer journey and looks at the customer conversion from the awareness to the buy, to the pay, to the use and to getting help. We have confidence to deliver the transformation targets by 2023, and we are well underway because we have proof points. We have started the cleansing already quite radically. We have already taken out 15% of the products as of today. And we have Already started to scale some of the core products that we have, and we mentioned a few of them earlier in the presentation, where we have today 15% of the portfolio already scalable, so we are taking this across the markets and therefore, we get more scale, we get more, Of course, cost benefit, which we can pass on also to an extent to our customers. This is the first value lever in our transformation. Now looking at the 2nd value lever, which is the processes. Again, we started with a quite radical and transparent assessment where we are today, complex processes, process gaps. When I talk processes, I talk customer facing as well as what we call back office facing. Both of these sites do have those complexities in place today. And Time reduction from the start of the end of the product process by at least 20%. And we look at a reduction of error rates by at least half, error rates coming mainly because humans involved typically are not 100% reliable. So therefore, when we automate the processes, we will also achieve a reduction in error rate and a better quality process end to end. 2nd, we have a low degree of digitization automation in the processes relating to the manual component that I just mentioned, which will be taken into 100% digitization and 0 touch wherever possible. This again leads to a much, much better quality process and obviously to efficiencies. Then we have also today a lack of process standardization, Which again, as in the product side, different processes for the same thing lead to different IT supporting it, lead to more IT costs. So therefore, we are looking at harmonizing the processes. We will do this very diligently. There's no big bang going on. But over time, we are converging towards harmonized processes for the customer facing side as well as for the internal back office side, which then again leads to a lot better IT support and less cost. And then we are looking at currently our processes not really being adaptive or smart because we don't use data and analytics In the processes today, which will be changed by what we call intelligent automation, which is based on the analytics and the data so we can have personal, for example, recommendations to the customer or we can have specific process variance depending upon what is the need in this very moment. Last but not least, we are also not looking at doing this as a one off exercise. We will change the way how we are looking at the processes as a continuous improvement culture. Therefore, we are implementing Lean 6 Sigma across Telia, Which gives us that continuous mindset of wherever we are not good enough, we will improve and that will never stop. Again, here we are confident to deliver. We have seen good first results. For example, we have transformed the processes on the B2B side In Sweden, and we have seen an uptick of the sales efficiency by 10%. We have seen the customer the response times to Customer query is going significantly down because we have been able to retrieve the information and resolve much faster. So we see already today good signs of the success which will be taken to other segments as well as other markets. We also have already established now a center of excellence for automation where we have RPA experts in the group, quite a good group now which we are deploying across the company to really actually implement the process automation as we speak. We have already standardized processes. It is a hard work, of course, but we have started, for example, on the service assurance side, which is a very, very strong team across Telia already Established 90% of those processes standardized, so we are already domain by domain looking at the first successes here. And for the insights and for the automation part, I'm very happy to share today that we have closed a strategic partnership with what I think is the leader in the domain Of workflow automation ServiceNow, with ServiceNow, which is already a good partner, but we are widening the partnership to really cover customer facing as well as operations facing workflows so that we have an end to end closure of any issue that is coming from the customer or that is triggered by any of our network and IT nodes. Now let's look at the 3rd value lever, which is the very important element of real time analytics, the digital telco Cannot exist without using data and insights. Again, here we start with an assessment. We see we do have Today, gaps in actually utilizing data, both for customer experience as well as for commercial opportunities, And we will change this by really using data, unlocking the value of data for brilliant customer experiences as well as for monetizing customer value or customers from one product to a next product or to any other service With what we call NBA Next Best Action or Next Best Offer, which is basically whatever is the most relevant product, we will recommend rather than just the next promotion that is a cookie cutter for all. And this will be rolled out 100% across Telia by the end of the transformation time, which is 2023. Secondly, also, beyond the fact that we're not using the insights for value creation enough, We have lacks in the technology and we have lacks in the, actually organizational enablement today. We are still relying heavily on traditional tools such as Excel and PowerPoint. And we do see that actually the demand from use case implementation is more than the capacity of experts we have in place today. So we are actually further increasing the team. And if anyone wants to recommend anyone to us for analytics experts, we are very open to hire more into our team. And we are not fully complete with our technical analytics foundation today. So therefore, we are looking at a completion of the analytics foundation, which is fully cloud based as well as on prem, so there's a hybrid cloud, which has all sources integrated which has a common data lake and which enables real time use cases such as real time recommendations to our customers. Again, here proof points make us very confident we can deliver. For example, on the TV side, we have Already recommendations in place, be it the next movie or be it a more personalized relevant advertising that is shown to individual users as it comes. We have already launched personalization, what we call at scale, In the B2C, in the consumer segment in Sweden, also in Finland and other markets where we have seen almost a doubling of the conversion by having a relevant offer as compared to a standard offer to everyone. We already have converted 20% of our staff to using online and real time dashboards and they're actively used, which is good. But of course, we want to go to 100%, as I said. And we have onboarded already more than 300 analytics experts, which is a fair amount of people if you think about it. But still, it is not enough. So we are further increasing that number. And we have already a good data foundation with our strong partner, AWS, and some others Where we are seeing the value coming today, but we are, as I said, rolling out the data foundation across all our markets in the next years to come. Now I come to the 4th and maybe Somewhat boring to some, but I feel most important value creation lever because it is underpinning the products, It is underpinning the processes and it is underpinning the analytics part that I was explaining and that is the IT. We are seeing the IT as the enabler for the true digital telco and as an enabler for delivering excellent customer experiences. Here again, we have taken an extremely deep assessment in a very dedicated project, which we started in the middle of last year. And we're looking at a couple of issues that we are tackling. We do have seen an insufficient market and customer focus, a link between IT and business, which we are now drastically changing by changing into a safe agile setup where we are connecting the teams together into value streams, tackling the same objectives along the key results which we are measuring. So we are closing the gap between IT and business and deliver what we need to do on the customer experiences and on other use cases such as the internal process automation. We have, as many other companies, I think also, an organically grown IT, both from the growth as well as from acquisitions over time. And we see vertical integrated solutions, which make it very hard to maintain going forward. We have accumulated technical debt, What I said before, and that has dragged a lot of our funds into maintaining the lights rather than being able to innovate. So we are now drastically changing into an open and API driven architecture. And I'm very happy to also share today that we have also signed the TM Forum manifesto that really commits us towards ourselves as well as towards our partners and likewise our partners to us to work in a much more modular into a much more API driven way, which makes it easier to configure, which makes it easier to partner, which makes it a lot faster to deploy. And this is the target architecture that we have defined and we are going to be converging to in the next years to come. We have many legacy systems, which are due to the fact that we have installed the vertically integrated products and services. So we have identified those and we are going to be commissioning almost all of them by the end of 2023. We have a high degree of customization. We did not really implement in a modular way, which is again Changing into the target architecture where we talk about configuration rather than customization. We talk about modularization and we are talking about API driven working internally as well as with our partners. Also, we have a quite fragmented supplier landscape today, which we will change into a much more focused supplier and strategic partner oriented way of working, which we are going to be scaling across the group. So there is an opportunity to just gain more scale also for our partners, and we will look at reducing the long tail of our suppliers by at least 50% in the next 3 years. And last but not least, we have today a quite high dependency on external workforce in the IT, which we consider a risk. As we are becoming a software company, we need to own the IP, we need to own the capabilities from user experience design to the implementation, to the integration, to our core business domains in the IT. And therefore, we are looking at a strategic workforce planning, Which looks at the rightsizing of the external share. It's not going down to 0, but we're looking at something between, I would say, 15% 20%. And we are maximizing further our strong near shoring location in Lithuania where we already employ today 600 IT experts And another 300 other shared services, and this will grow further at good cost and efficiency, very good quality and will deliver the IP and the competences that we need to have in the company in house rather than depending on externals. Again, here, I think we have high confidence to deliver. It is not easy, but we will do it. And the proof points that we have are, we have already converted a large part of our IT projects into Agile today. We see that those projects result in a much higher efficiency, which is the output As compared to the input what we put, so it's a lot better to work like this. We are getting the time to market. We are getting also The delivery in the much lesser investments. We have already completed a very significant target IT implementation in the consumer segment in Sweden, which is obviously extremely important to us. And we have almost completed even the migration of the customers from all the legacy systems onto the target system, and that has been a great success and I think delivers a lot of more use cases, monetization and also customer experience. We have identified the legacy systems, almost all of them. Some are depending upon a few decisions on the target architecture. And we have decommissioned already quite a number of those systems and this will go on, as I said, in the next years to come. We have limited the customization and we have driven already the implementation of common APIs across the group, which is also important for our partners to work with us because then they don't have to go to each and every country, but they can plug in, so to speak, to Telia as one Telia and work with us much easier. With this, I would like to close and hand back To Andreas. Actually not right. I'm handing to PC, sorry for this, to detail now The financial impacts of the connectivity part and the financial impacts of our transformation initiative that I was detailing. Thank you, Reiner. We clearly have an ambitious and broad agenda ahead of us. And I'm going to try to summarize it in financial terms, in both the cost side and also on the investment side. So What we have done, as you know, we conducted a very comprehensive benchmark last year where we identified several large gaps of inefficiencies. The plan and initiatives that now Rainer has presented is addressing those gaps. We are also now setting up a very clear program structure where all of this is sort of closely monitored follow-up has clear initiatives, time line and KPIs. I will quickly now touch on some of the sort of key levers that Rainer just have gone through on a very high level and then try to show how that relate into the financial and cost development. The automated work, definitely, going from manual to automate will help us to reduce cost, simplify our product landscape, Modernize and simplify our IT architecture has several implications on our costs, not just on the IT as Reiner mentioned, but also on other parts of the organization. Increased number of digital customer interactions have good effects on reducing cost and customer care and also to reduce the sales and marketing cost. Moving further to more targeted marketing communication can be more make us more relevant, have more impact and increase the return on our marketing investments. We will also embark On a quite ambitious agenda to reduce support and overhead cost, both by improving our systems, our processes, but also to redeploy our resources closer to the customer. And last but not least, A lot of our plans, privatizations and decisions in Telia today is made on experience and gut feel. And as Rainer has talked about, we have to move much more into being fact based and data driven in our work. So all in all, This translates into what you already have seen, a concrete net cost reduction of SEK 2,000,000,000 by 2023. And this is including price increases, inflations and so on. So this is a net cost reduction. And as you can also see on the slide, a big part of this is coming from reduced resource cost, both our own people, also external consultants. And also as we have commented on is that already in 2021, our target is to reduce by 1,000 resources. We also see good effects from these levers to be more efficient in both our sales and marketing costs and also other costs like IT costs, as I mentioned, bad debt, energy, etcetera. This whole program, we expect, will increase restructuring costs by about SEK 0.5 billion per year. But as I said, this is now a very comprehensive program with a clear governance structure in place, with a clear plan, initiatives and KPIs that we follow-up on a regular basis. So let me move into the CapEx efficiencies Because the benchmark that we have performed also shows that we have inefficiencies when it comes to our investments. There are many levers again. Let me just highlight a few. The standardization and simplification had also, as Rainer has mentioned, big effect that we can reduce our investments and achieve the same number of activities. Leveraging insight and analytics in how we work, where we can better predict in time where we should roll out new sites, when we should do capacity enhancement both on the IT side and on the network side can both improve our customer experience but also reduce the cost and investments, improve our planning capabilities and processes, can lead us to have better terms with our vendors, Can make us increase reuse and recycling of our equipment. And lastly, really focus and have tough governance in terms of prioritization, making sure that we only invest in activities that gives us good return on our money. So on top of the net SEK 2,000,000,000 OpEx reduction in the period, our target is to increase SEK 1,000,000,000 in CapEx efficiencies. So totally, the transformation program should deliver SEK 3,000,000,000 of savings. So let me move then into the CapEx plan for the period. The agenda on Inspire, Connect and Transform is underpinned by a very concrete and comprehensive investment agenda. There's 3 main parts. Very quickly, on the mobile side, we will, as mentioned, invest into modernizing our mobile networks. We will roll out 5 gs to most of our customers in the period. But note that these investments is not just coming on top Because we can replace a lot of plan, capacity, coverage and end of life investments with this modernization program. And the benefit is obvious, get the coverage, 5 gs rollout, enable us to upsell to our customers based on a better customer experience and also reduced churn. The fixed network investments are expected to be quite flattish in the period, but we expect to get more out of the investments. We will terminate our legacy, as Rainer mentioned. We will expand our fixed network footprint, both on our own, utilizing fiber and fixed wireless access. But also as Alison mentioned in the beginning, we will be open to work together with existing and new partners to get more expansion on our fixed network. On product development and IT, which is very much around the transform pillar that Rainer just talked about, we will invest into building capabilities on convergence, analytics, common product platforms, modernizing our IT, simplifying our product portfolio, etcetera. And the benefits are quite obvious in terms of supporting our journey to improve customer experience, at the same time, radically reduce our cost over a period of time. So if we transfer that over to the investment levels, we expect CapEx, as you have seen, to go up in 2021 to 17% of net sales. This is driven by 2 factors. One is the sort of step up that we're now doing on our mobile networks. And the other one is some increases on product and IT investments. But the increase in product and IT is not that big. And that's because Reiner and myself is working really, really hard with all the a country organization to really prioritize investments to enable us to sort of use more of our investment funds into building the future Telia. In 2022, we expect the investment levels to remain around the same level before dropping in 2023 to around 15% of net sales. The drop in 23% is coming from 2 factors. The first one is the efficiencies I talked about a minute ago. And the second one is the high investments into our mobile network is expected to Fade out a bit. So as I said, this is a very comprehensive, clear investment program for the period. But of course, we will follow-up, we will benchmark, we will improve and adjust along the way to ensure that we get good return on these investments. So that was the financial summary so far. And now we will move into how we're going to deliver and execute on this agenda. And to do that, I hand back to you, Alison. Thank you, Pacey. And thank you, Rainer, as well. So now the 4th and final pillar of how we are going to deliver on our ambitions. As I said earlier, the most successful, modern, innovative telcos are those that lead with customer experience and have a strategy to execution muscle that allows them to deliver consistently and sustainably. So the 4th and final enabler of our strategy is all about execution and how we will deliver on our promises going forward. Great execution starts with clarity of purpose so that everyone is clear in the ambition. It also starts with recognizing what needs to be done differently this time around. And since arriving at Telia, as you're well aware, I've identified a number of areas we are doing better can only strengthen our execution muscle and you can see some of these on this slide. Telia is a big organization and I don't underestimate for a moment what it takes to bring about change. But I do believe we now have the right ingredients in place to drive that change and deliver sustainably for a long time to come. A strategy enabled with clear and cascaded operational plans and performance management systems, motivated employees, an integrated sustainability agenda, a bold transformation plan and a refreshed leadership team. For me, change in a first step is to put the right people on the bus because it all starts with leadership And it all starts about complementing me as the CEO. As you know, I have strengthened the leadership team to complement me and to ensure that we have the experience and the knowledge to achieve the ambitions that we're now setting out for. The ones in purple are the new members of our leadership team. And no, that isn't our Chairman in the corner, but it is a well known observer cheering us on from the sidelines. Now we have a Finn on our leadership team for the first time in many years. We have deep Baltics experience and our team more fully reflects the diversity in our home markets as well as reflects international and deep TMT experience. Importantly, we have deep experience from individuals who have created and operated agile digital telcos having first worked in incumbents. We have individuals that have worked in e commerce, who have commercial execution and in how to reinvent iconic brands. After having the right people on the bus, it's then all about how we figure out where we want to go and where the bus is supposed to go developing a clear strategy to take us in the right direction forward. Coming from P&G, I know what it takes to implement a strategy and to consistently operationalize that with clear accountability and a sense of urgency tied to performance management. This strategy is enabled by a very strong transformation program, not only a technical program, in the functions. And talking about fully integrated, just as transformation is fully integrated, we've also updated our sustainability strategy to be fully integrated into our business strategy. You can see here some select examples of our expanded and daring agenda across all of the strategic pillars, incorporating a broad set of values that we ourselves and our stakeholders increasingly expect from us across the environmental, social and governance fields. Within this, climate and circularity contributing to a cleaner and healthier planet digital inclusion so as to leave no one behind in the digital world and privacy and security to gain and maintain the trust of our stakeholders will be priority areas underpinned by strong ethics, human rights inclusive policies and ways of working. We are embedding sustainability in all material processes and work with clear targets and responsibilities integrated in everything we do while making strong contributions towards the SDGs. I don't have time to go through all of this today, clearly, but I'd love to have a separate session with all of you and your ESG teams and our ESG teams to take you through this bold and daring ESG agenda separately. A clear message from me today is the full team leadership are totally behind this plan and that our strategy is fully linked to our financial ambitions. PC has showed you this before, and I hope you're hearing from both PC and Rainer just how close they are to the development of the plans and what it's going to take to deliver on our ambitions going forward. Our various initiatives are set up to enable our structural part of our cash flow to grow on a sustainable level from a number of different directions. 1st, by reinventing a better customer experience and through less legacy burden, we will revitalize top line growth. 2nd, a modern and future proof infrastructure is vital for us to be able to reinvent a better experience for our customers. This requires CapEx, but we will make sure that we deploy CapEx in a more efficient way where it matters. 3rd, our transformation program will lead to real OpEx and CapEx reductions. OpEx will be reduced by £2,000,000,000 in 2023 and we'll build to that by 2023. And on top of that, transformation will yield another DKK 1,000,000,000 from reduced CapEx. So in total, DKK3 billion by 2023. But the story doesn't end in 2023. Beyond 2023, opex will be further reduced by DKK 2,000,000,000. So we'll be on a run rate above DKK 2,000,000,000 by the end of 'twenty three. So total OpEx reduction of £4,000,000,000 in 2025, leading to a total transformation effect of €5,000,000,000 by 2025. Finally, all of this leads to our ambition for the coming period 21 to 23. And this is a framework for how we as a team look at Telia's financial targets over the medium term and specifically the outlook until 2023. So here is our outlook for the coming years. For the top line, we expect low single digit growth each year, driven by a reduced burden from legacy regulation and the gradual COVID-nineteen recovery, in addition to growth from upselling convergence and new revenue streams. We expect adjusted EBITDA to grow by low to mid single digits each year, explained by the service revenue growth just mentioned as well as positive effects from the €2,000,000,000 cost reduction during the period. CapEx is expected to return to 15% of net sales by 'twenty three, thanks to the efficiencies that you've heard about and reduced investment in our mobile network as we come off of the peak investment period. For this coming year, we expect service revenues to show flat to low single digit growth. As we are still held back by legacy pressure, we only expect gradual recovery from COVID and the commercial turnaround will take some time before we have a full effect on a year on year basis. For EBITDA, we also forecast flat single digit growth as we have limited service revenue growth during the year while the cost reduction program is still ramping up. CapEx, as you heard already, is expected to be in the range of £14,500,000,000 to £1,000,000,000 yes, an increase versus 2020 related to higher investments in mobile network modernization, 5 gs rollout as well as increased transformational investments. And with that, I'm going to give the floor back to P. C. For a bit to take us through the cash flow development, balance sheet targets and our new dividend policy as well. Thank you, Alison. As mentioned, the EBITDA is expected to be flat to slightly improving in 2021 before returning to growth in 2022 and 2023 in line with our midterm ambitions. CapEx is expected to increase to €14,500,000,000 to €15,500,000,000 in 2021, staying around that level before then going back towards 15% of net sales in 2023. Other elements of the cash flow, including interest rate, interest payments, tax payments, pension contributions, restructuring costs, etcetera, in totality is expected to be quite neutral during the period. If you look at the structural part of cash flow, that was around SEK 9,000,000,000 in 2020. We expect that to come down in 2021 due to the higher CapEx, but then start to increase from the EBITDA growth and then in 2020 increased from combination of EBITDA growth and reduced CapEx. Working capital, as has been mentioned, has been a key driver of cash flow growth over the last few years. And in 2020 alone contributed more than SEK 3,000,000,000 on our cash flow generation. As we have talked about before, we believe that we will still have positive contribution from cash flow going forward, But they will gradually go down during the period. And the reason we will still have positive contributions is that the initiatives that have given us the effect so far continue in terms of vendor financing, terminal financing, inventory management and also on the billing cycle. So if you look at total operational free cash flow, we'll go down In 2021 and then recover, if you look at the sort of the dividend cover, operational free cash flow, we cover the minimum dividend floor in the entire period. And from 'twenty two onwards, we will be able to cover the minimum from the structural part of cash growth, meaning no contribution from working capital. So that is just to provide the safety net. It's not necessarily what we're aiming to do. Over to the balance sheet. Our ambition is to have a very strong balance sheet. It provides us with low financing cost, easy access to capital and also secure flexibility. I know you like us to be more specific on what levers we are targeting. And therefore, we are now reinstating a target on net debt to EBITDA of 2.0x to 2.5x. In addition, we will maintain our target of a solid investment grade rating of A- to BBB plus we will continue on our journey that was started a couple of years back to continue the sustainability effort also on the financing side. And we have several proof points on that already. Moving to the dividend side. Our ambition is to provide a predictable, sustainable and well funded dividend. In addition, we would like the dividend to be closer tied to the improvement in our operational performance. Therefore, the Board has decided to propose to the AGM to revise the dividend policy for Telecompany. So the updated policy is to have a floor of SEK this means that the shareholders of Telia will take part in the targeted growth in our profitability. The dividend policy is fully compatible with the cash flow outlook, but also the leverage targets that we now have just commented on. And just to repeat, the cash flow is expected to cover the minimum level of the dividend policy. And from 'twenty two onwards, the structural part of cash flow will at least cover the minimum part. To summarize, we have a framework to create substantial shareholder value. We have a solid, strong and ambitious strategic agenda that we have presented today. We have clear financial ambitions on service revenue, EBITDA and CapEx, and we have a clear ambition to maintain a strong balance sheet and also provide attractive shareholder remuneration. And with that, we are going towards the end. I will hand back to you, Alison, to wrap it all up. Thank you very much, P. C. So you've all heard a lot today about our plans, the measures we're taking. And let me just summarize the core components before we open up for Q and A. 1st of all, we believe we have a great opportunity on our doorstep because we're in a highly attractive region. The team is in place. Colleagues that complement me have great relevant experiences, people I trust and are totally motivated as a team to deliver on the plan ahead. We have got multiple levers of growth at our disposable. 5 gs, ICT, convergence and more, and we will have less headwinds going forward as well. We also have infrastructure assets that are highly valuable, and they will be there to deliver on our growth plans with the intention to crystallize some of those even further. And our bold transformation program will make us more agile, more efficient and we have a very clear road map to deliver on it. We therefore have the foundations to provide very attractive shareholder returns going forward. And as you saw earlier, our purpose will be our North Star. Our strategy will be our road map, resulting in Telia being rewarded by having the most loyal customers, the most engaged employees, the most satisfied shareholders and the most empowered societies because that's our ultimate goal. So in summary, a very clear roadmap to enable growth, develop our assets and reset our cost base, allowing us to reinvent better for our customers, our employees, our owners and the societies of the Nordics and the Baltics. And I hope you see how committed, energized and passionate we are about delivering a new, better Telia for all. So on that note, you probably all would love to get some Q and A in. So are we going straight to that, Andreas? We are. Good. Let's go. And P. C. And Ryder are now joining, and Andreas is here for questions as well. So let's open the line. Thank Your first question today comes from the line of Louise Patrick from Barclays. Please go ahead. Your line is open. Yes, thanks guys. Thanks for hosting the event today. It's a shame not to be with you in person, but next time I'm sure we will. If I can ask a bit about the digital transformation plan, you've given us lots of color today, very, very helpful. I guess very cynically, one would say that we've heard it all before, different companies and Telia. So perhaps If you could and I know you've been through a big sort of benchmarking exercise you've talked about as well, but perhaps where are you today compared to your peer group? Is Telia behind Are the European telcos, global telcos? And I guess once you've been through this plan, where will you be? I mean, whether it's 2 years, 3 years, 5 years, some more insight than that would be great. Thank you so much. Horace, Thank you for the question. Yes, I'm sorry you're not here either, but it is quite snowy outside today. Great question. Every telco in the world is going through a digital transformation at the moment. I will hand over to Ryan in a minute, but what's different about us is, you know, I specifically targeted Rainer and some of the individuals that he's brought into his team because they have seen and operated real digital telcos in Asia and are now bringing that experience to Telia. And while we've made some progress over recent years, and I think Rainer can touch on that, he has a very comprehensive view on what it's going to take for an ex incumbent like Telia in a way that we've not been able to do comprehensively before because we've just not had the talent that have operated in these digital telcos that are much more lean and agile as you see out in Asia. Rainer, do you want to take the rest? Yes. Thank you for the question, and that's the right question. So I think there is, if you look at the benchmarks, the risk to always run after the short term benefits. And that doesn't deliver the longer term sustainable growth and a sustainable efficiency. So I think Kind of a learning that we have seen and that was what I tried to allude to in the transform part, we are looking at a much more sustainable customer experience driven transformation, which will be a lot more pervasive. So we are looking not just a cost cutting exercise, Transformation program now really has, if you look at it in more detail, a complete transformation of the customer experience, a complete transformation even of the people experience, which we didn't talk today, A complete transformation of the back office automation, which then drives the cost takeout on the OpEx side, A complete transformation also on the connectivity side, which is what I tried to explain on the softwareization side and the efficiencies and also the further opportunities. A complete transformation of the IT side, which is the basis for a sustainable delivery of the customer experiences and the automation and also a transformation towards the data driven organization that we try to explain. So I think the notion is that yes, we are looking of course at benchmarks. We have done the benchmarking. We are not top notch and we are aiming at getting to benchmark level, but we will do this not in a short term cost cutting way. We are doing this With a longer term perspective of sustainably delivering the efficiencies and the top line growth, of course, we will have in practice always A short term and a long term view. We have the 2021 deliveries. We have agreed on the plans. We are delivering on the plans this year, No question. So there is a lot of work going on, but we are not stopping there. I think the point is that we make today, we are looking at 2021 and beyond. And this transformation program, maybe last comment on this one, is nothing that actually will stop. We are going to be transforming the company Into a continuously improving organization where there is no end to improvement. We will never be perfect enough. We want to improve and we put into the system That continuous improvement mindset and structure. I hope that answers the question a bit. And Morris, the other thing that we've got a benefit of now is now that we're we have focused into a Baltics and Nordic footprint, we can now reassess the overhead and the governance that we've had at Telia when we had a much broader footprint. So a lot of benefits that we'll already be able to get this year is reducing overhead and simplifying and better aligning line of sight all the way from group through to the countries. And that's why you'll see OpEx reduction of around are we disclosing how much for this year? No? Okay. That's why you'll already see some OpEx reduction this year. Got it. Thank you. And your next question comes from the line of Nick Lyle from Societe Generale. Please go ahead. Your line is open. Hi, everybody. Just a quick question, please, Alison, on the convergence points you made at the start. I'm still struggling to see how you're going to drive convergence in Sweden without price cuts and discounted content. So can you just maybe talk us through that given your price position is quite a bit higher And some of the your competitors, including your old business. And secondly, does the broadband position in Sweden stand in the way of that. Your market share is quite a bit weaker than it is on the mobile side and gets weaker as you move more and more towards fiber. So is that something you have to attack as well to get convergence moving? Thank you. I think, as I said there, we have not had all of the tools, systems, customer transparency in place cascaded all down the organization to really drive convergence. So we can do this in a more for more value accretive way by without disrupting the market because we've only just post summer, being able to start seeing our customers through the lens of one view with their mobile and broadband. We're only now changing our sales procedures and our call center procedures to be able to do the cross sell and up sell. Yes, it's slower than one would expect, but we're only actually putting those actions in place now. In terms of and we also we are yes, we have Telia, the premium brand. We also have Halebop and we also have Fellow. So we play in all of the segments of the market allowing us to ensure that we don't dilute the Telia brand but stay very competitive using our whole brand portfolio and through some of the data and analytics that we're getting, we're going to be much smarter at how we target the different brands for the different type of customer we're trying to attract. In terms of broadband, you're right, it's a lower share versus what we have in mobile. But with fiber, with fixed wireless access, with us going into open city networks And with us using the full range of products we have, we have the potential to grow our broadband market share. We've got a great example recently where we just won one of the big housing associations in Sweden with 20,000 dwelling units. And we were able to combine our mobile with our broadband, with our TV, with our smart Wi Fi and with our IoT for smart homes all together. And that was a great win for us that gave us new broadband customers, but also gave us new TV customers and added value services on top. So we do believe we've got a full range of tools and we've got 5 gs. We'll be rolling out very rapidly. We've got a strategic partnership with Ericsson that allows us to get off to a fast start with the new spectrum. And it's our ambition to monetize 5 gs in all segments of the market. Okay. Thanks, Alison. Thank you, Nick. Thank you. And your next question comes from the line of Lena Osterberg from Carnegie. Please go ahead. Your line is open. Thank you. Lovely day, even if it's snowy, I have to say. I just wanted to first start with confirming That the savings are definitely net, that you expect to get this money out to 100%. And then I'm just wondering how will we'll be able to track sort of progress of your transformation, not just the money, but where you're going. That's been the problem in the past that you have not released KPIs, and I think you have not tracked them internally either. So I think will we be able to follow you on this And in that case, how often will you disclose? Absolutely, Lena. The savings are net, And we will be sharing we have now that we've got a German on the team, let me tell you, we've got OKRs for everything. So we have developed a whole monitoring system to really monitor the progress not just of the financial outcome but the leading indicators and all of the drivers of the transformation program. And it's definitely our intention to be transparent with you. And I don't know whether you want to build on that, P. C, Or Rainer to just give Lena the comfort that this is a very comprehensive monitoring machine that we're planning to build and be able to be very transparent with you going forward. Yes, I think I can just I can just start by saying, it's a little bit reiterating what you said. I mean, it starts internally first of us sort of getting the structures, the governance and the follow-up mechanisms in place. And in place, and we're working very integrated here across functions and group and countries. So that's step 1. The next step is that we will keep you updated on our progress, team so that he gets the visibility over. And it's all online increasingly. Yes. So maybe just to add to Alison and PC, again, what we are going to be communicating outside, I think, exactly. I've shown some KPIs in the transform part today. There's, of course, a whole pyramid of KPIs behind. And we are looking at essentially 2 parts if you go one level deeper. 1 is the Operations KPIs underpinning the financials. The other one is the delivery of our initiatives. And I think both of these things are quite important Because they are also kind of trading KPIs and we want to be early so that inside in our teams we can also detect If any of those initiatives that we have defined and Alison showed that kind of a chart where you have seen a bit of the glimpse of how pervasive are we going, If any of those go into a, what we call, blocking or major issue, we can step in and immediately try to resolve rather than finding out A trailing KPI later, which then, of course, typically loses a lot of time. So I think we feel fairly confident that with the transformation setup, which is really pervasive across The markets and across the functions, we have that kind of what I call early warning system in place. And again, what we are going to be exactly communicating outside, we will see. But Inside, we can clearly give the confidence that we have now a transparency in place which will help us to deliver. So you will be able to hold us to account this time, Lena. Looking forward to that. Thank you. Thank you. Thank you. Your next question comes from the line of Stefan Galvin from D and D. Please go ahead. Your line is open. Yes. Hello. A couple of clarification questions. There was earlier a target by the former management team of reducing OpEx by 2% in 2021, and that included some synergies. Does this new targets replace the old target? Just a follow-up. You have earlier said that the inefficiencies We're mainly visible in the incumbent markets. And I've interpreted that to be Sweden and Finland. So is that correct? Should we see the cost savings primarily in these two markets? Thank you. No, the cost savings are everywhere, Stefan. Trust me, there is opportunity everywhere. Do you want to take the first question, P. C? Yes, I can do that, Alison. Yes, just to also support on the second question. I mean, there are, of course, different Cost saving opportunities, different places in the footprint, but we see significant opportunities in all markets, both big and small. Dan, the new targets that we now are communicating is the total, right? So there's no addition on top of that. So the targets that earlier management have communicated is now embedded in. Summit already delivered, and the remaining part is part of our CHF 2,000,000,000 cost reduction by 2023. And we also, as mentioned, we will have a significant portion of that already in 2021. Thank you. Very clear. Thanks, Stefan. Thank you. And your next question comes from the line of Ulrich Haate from Jefferies. Please go ahead. Your line is open. Yes. Thank you. I have two questions, please. The first one is on the Service revenue growth, the return to service revenue growth. Could you outline how you see the market backdrop to that? Ultimately, you said there's a COVID unwind which presumably impacts everyone. But I'm wondering whether you have sort of a specific Target here of share increase or whether you think Telia will grow with the market or take most of the market growth for that matter. The second question is on the restructuring costs. There was a comment on one slide that this will increase by SEK 500,000,000. What's the baseline here? Is that roughly €500,000,000 baseline? So together €1,000,000,000 And in this context also, there was another comment then on the free cash flow discussion, saying that the other items of free cash flow, which include the restructuring, would be about flat year on year. So So how does it sit together? If there's €500,000,000 more coming in the P and L, then why is that flat free cash flow? Is it because you're simply provisioning for longer term cash that will just drag down the numbers for longer and therefore you don't see it in 2021 or is there anything else going on? Thank you. Ulrik, always great to hear from you. So I'll take the service revenue question and then I'll pass over to P. C. On the restructuring and the cash flow. On the service revenue, where we're the market leader, clearly, it's our ambition to grow the market and for us to grow with the market. But we're not always the market leader in every segment of the market. So within some markets, so for example, in Sweden, there is room for us to grow our share of the TV market and to grow the total pie for everyone of mobile when we aim to monetize 5 gs going forward. Where we're challengers, clearly, there is still room for us to take market share, because we're coming from behind in a number of our kits. But again, we will aim to do it in a way that is good for the market And is sensible for us as a company. So it varies by segment and market, but assume market leader, our role is to grow the market so that everybody benefits, but particularly our customers benefit from higher value products and services. And where we're coming from behind, we will aim to take some market share. Then I can take the last two questions. Yes, you are correct. There is an increase of restructuring cost of SEK0.5 billion. The last few years, we've been averaging around SEK 500,000,000. So that means that the total restructuring cost in the period is around SEK 1,000,000,000 per year. This increase is included in the guidance on the other components staying flat. But keep in mind here that this is a combination of interest Payments, taxes, restructuring costs, lease payments and pension contribution. So there are different moving parts, and And there are other factors that kind of compensate that increase in restructuring cost. Great. Just to confirm, there's No big provisioning for longer term free cash outflows like the retirements, which then weigh on free cash flow for years to come. No. Thank you very much. Thank you. And your next question comes from the line of Johanna Alkrest from SEB. Please go ahead. Your line is open. Thank you. I have two questions, if I may. The first one relates to the infrastructure. I I don't know what you call it, it's not a company you formed, but it's a division as I understand it. I'm just wondering what type of infrastructure do you include in that? Is it the fiber, the towers and everything? And how much potentially would you consider Divesting, is the minority 49% or is it 10%? And then how far have you come in those discussions? I mean, is it very early days, so we should not foresee anything happen here Until 1, 2 years ahead or how do you look upon that? So any details on that would be very helpful. And then the second question relates To the entire, yes, IT transformation you're going through or will go through, I'm just wondering where do you see sort of the biggest risk in a sense? What's the where do we need to keep our closest eye on? Where in this whole transformation lies the biggest risk? Thank you. Thanks, Joanna. So we wouldn't be announcing the Telia Asset Management division today if we weren't very much well prepared to start deep dialogue with partners that have been approaching us for quite some time. So And that's why we're already announcing that Andreas Ekstrom will head that up because he's having we've been preparing this for a while. We've already identified the tower assets that would be interesting and attractive for us to partner with others. So immediately, we put our Latvian assets in that division and we'll put our CAPMAN fiber finish asset in there. Towers are the first priority and as we said today, focusing on our challenger markets first, Norway and Finland in particular. And we are ready to launch a process there very, very soon. How far might we take it? We do see that vehicle as possibly being a vehicle we can use for further fibre infrastructure investment in the future as well. So beyond towers, there will be fibre opportunity in there too and we'll seek to find the right partners to work with. How far are we prepared to go? It really depends on the value creation potential of the partnership. We start from a point of view that we want to own and operate and share and sell a minority stake up to 49%, but it it really depends what we're being offered at the end of the day, Joanna, because when you look at these assets, you've got to look at how much value do you get upfront versus what are the implications the longer term MSA agreement. So we are we're very open minded. We've been approached by multiple people and we'll be back soon once we've got specific transactions to dialogue with you. Does that answer your question on that piece? Yes, definitely. Thank you. Thank you. And then on IT, Rainer? Yes. Thank you for the question. Excellent. So Let me start by saying that I think we have already started to derisk quite a bit. And why I'm saying this is I mentioned the strong delivery integration that we have put in place on the network side. I didn't mention the strong delivery capacity we have put in place on the IT side. I Just want to say that over the past year in 2020, we have completed a full IT integration operationally on the ground, Which is to say that now as Telia, we actually have one integrated IT, which gives us a platform To go into what we are seeing in the future, which is a much more scalable IT infrastructure and a much more integrated IT delivery. So I think we have done A fairly significant step towards de risking, which would otherwise be a risk if you have a very fragmented situation Across the countries. That isn't to say that we have already, of course, integrated all the IT systems. And I was alluding to the target architecture Conversion as well as the legacy takeout, which is, of course, what we are doing as we speak. But as a precondition to do that, we have done, I think a significant step of integrating and implementing, in fact, a common delivery model, which allows us now to have that scalability of products and services and systems across our markets. In terms of risk, I think the other Element that can be a risk in an IT transformation, which again we will not see, I think in our case, is if you wanted to do a huge big bang. So we are not looking at an approach where we are saying there's a one size fits all that has to be basically ripped out and then implemented across all the markets. We are seeing a much more organic transformation, but we are very clear on our target. And I just had not much time to detail too much The target, but we are looking at a modularization and we are looking at a much more flexible setup so that I can actually say that we are, So to speak, repairing the IT rather than doing a big bang, which would be a risk. So I think that part also is de risked to a large extent. If you look at remaining risks, I mean, there are, of course, risks around do we have the right and sufficient capability in all places? We are looking at user experience focus. Do we have enough people that are really up to delivering great user experiences? We are hiring, so we are certainly looking at strengthening that part. We are going massively into the cloud from on premise to the cloud. Again, I've talked about this on the network side. Of course, the same will happen on the IT side. New software skills, DevOps skills, DevSecOps skills, CICD, there's a lot of methodology, state of the art methodology, which we will have to build further. We have it, but we need to build further. So there is a certain, I think skills augmentation that is required. And of course, if you look at the strengthening of the near shoring location, I was mentioning we have Currently about 600 very excellent IT experts in Lithuania. We are strengthening that location. We see there is enough capacity in the market. And of course there is a shift that is going on from the onshore to the nearshore in terms of overall headcount. So there will be A certain number of, I would say, watch outs that we need to see, again relating to capability and capacity. But I think overall, we have, like I said, de risked so far we can do in the last year the overall IT transformation, which As I was trying to say, is really the core foundation of our digital transformation that we have planned for the next 2 years. Thank you, Rainer. Hope that answered your question, Yaron. Thank you very much. Yes, definitely. Thank you. Thank you. Thank you. We will now take our next question. And the question comes from the line of Andrew Lee from Goldman Sachs. Please go ahead. Your line is open. Thanks. Good afternoon, everyone. I had 3 questions. So if you don't want to answer the last one, that's fine. The first one is on the Swedish growth outlook. I guess the most questions we've had I've had in from investors Today have been can you grow your Swedish service revenues in 2021 or 2022? You laid out really helpfully the legacy regulation and COVID color, and how those improved. But can you just talk about the rest because it's a consumer and B2B trends? Second question was on your, attitude to towers. Just a follow-up from your answer to the previous question. I'm just wondering, would you sacrifice control to work with an experienced partner and enable you to gear up like BT did recently in the Netherlands. And if not, why not? Why keep control And then the third question was, was a broader one. I thought it was a strong presentation today on how telco networks are more important Than ever in a COVID world. So do you get a sense that the regulators or the EU competition authorities may be becoming more supportive in terms of regulation or approach to consolidation that will enable you to generate high returns and incentivize those network investments. Thank you. So why don't I take telco towers and you can talk Swedish revenue growth, yes? Yes. So, first of all, on the regulation, I think certainly the dialogue that we have locally, We are getting full support for how important our networks are going forward. And I do think governments, both locally and at a European level, are recognizing just how important we are to keeping societies up and running. We can only hope that changes the regulatory framework going forward, but as you know, the Nordics and Baltics have a much more corporate friendly approach to regulation anyway and I think we work in some of the best markets when it comes to regulation. In terms of the towers, we're open minded. We will assess the value potential based on what the

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