Results for Q2 and H1 2023

Highlights

• Revenues: +7% vs. Q2 2022 to EUR 1,299 mn, driven by value-protecting pricing measures and upselling.
• Revenue guidance: Revenues expected to grow by around 5% in financial year 2023 (previously: around +4%).
• EBITDA: +6% vs. Q2 2022 to EUR 486 mn, due to the positive revenue development and despite higher operating expenses.
• Financial result: The significant year-on-year increase in interest rates is reflected in the interest expense. In addition, currency effects had a negative impact on the financial result.
• CAPEX: Increase of EUR 148 mn to EUR 359 mn,of which approximately EUR 110 million for frequencies in Croatia.
• Free cash flow: Below prior year due to higher CAPEX and changes in working capital.
• Dividend: EUR 0.32 per share (total EUR 213 mn) paid to shareholders.
• Rating: First rating by Fitch: With an A-, Telekom Austria has the best Fitch rating of all European telcos.
• Towers: Next step for the spin-off of the tower business: Extraordinary General Meeting on August 1, 2023.

Various materials on Q1 2023 available at: https://www.a1.group/en/ir/interim-results

The positive revenue development led to an EBITDA increase of 6% to EUR 486 million, despite high-er operating expenses.

However, the operating gains were fully offset by the lower financial result: Higher interest rates com-pared to the second quarter of last year resulted in higher interest expenses. In addition, the financial result was negatively impacted by exchange rate effects (mainly the Belarusian ruble against the euro).

In Belarus, as everywhere else, A1 experienced rising costs. However, restrictive price regulations limit A1’s ability to adjust prices accordingly.

Capital expenditures (“CAPEX”) increased by EUR 148 mn to EUR 359 mn. Of this amount, approxi-mately EUR 110 mn was invested to secure spectrum in Croatia for 15 years. In addition, investments in the broadband roll-out, especially in Austria, were higher than in the previous year.

As a result of the higher CAPEX and changes in working capital, the free cash flow amounted to EUR 30 mn (Q2 2022: EUR 171 mn). Excluding spectrum investments, the free cash flow would have been EUR 140 mn.

The Annual General Meeting on June 7, 2023 approved a dividend of EUR 0.32 per share. In mid-June, Telekom Austria AG paid a total dividend of EUR 213 million to its shareholders.