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great Swissom customer loyalty and good products

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great Swissom customer loyalty and good products

«Swisscom impressed with a strong financial result and good market performance in 2022»says the CEO Christopher Aeschlimann, summing up. And he continues: “We were able to stabilize the telecommunications turnover in the private customer sector in Switzerland. The propensity to change operator has decreased: compared to the previous year, even more customers remain loyal to us. Our attractive products, especially the blue subscriptions launched in May, our service and our excellent infrastructure were convincing. We also record positive results in the business customer segment thanks to our cloud and security solutions. Our Italian subsidiary Fastweb has grown in terms of customers, turnover and operating results».

Video message from Christoph Aeschlimann

Stable turnover in the Swiss core business, growth in Fastweb

Group revenue decreased by 0.6% to CHF 11 112 million year-on-year, but increased by 1.0% at constant exchange rates. In the Swiss core business, revenue rose slightly by CHF 37 million to CHF 8,270 million (+0.4%). Revenue from telecommunications services decreased overall by 0.9% to CHF 5,449 million. The contraction compared to previous years has clearly slowed down. In contrast, revenue from the business customer IT solutions business increased by CHF 70 million (+6.3%). Business in Italy continues to register a positive trend. Fastweb boasts a turnover growth of EUR 90 million (+3.8%) compared to the previous year.

Consolidated operating profit before depreciation and amortization (EBITDA) fell by 1.6% to CHF 4,406 million. Excluding extraordinary effects and with constant exchange rates, there was an increase of 3.1%. In Swiss core business, comparable EBITDA increased by 3.4%, at Fastweb it increased by 3.4% (in EUR).

Compared to the previous year, net income fell by 12.5% ​​to CHF 1,603 million. The decline in profit of CHF 230 million is mainly related to one-off effects in EBITDA (CHF 146 million), financial result (CHF 207 million) and income tax expense (CHF 57 million). Without taking these effects into account, net income increased by CHF 180 million.

Network Infrastructure: FTTH Enhancement Continues, Leads All Network Tests

Swisscom continuously invests in the quality, coverage and efficiency of its network infrastructure, consolidating its technological leadership. Group-wide investments remained high in 2022 and amounted to CHF 2,309 million (+1.0%). In 2022, Swisscom won all the major network tests: connect awarded the mark “excellent” for both the mobile and fixed networks.

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Mobile network: 74% coverage with 5G+

To ensure the high quality of the network and continue to offer customers a first-class mobile network, rapid expansion is required. At the end of December 2022, Swisscom already offered 74% of the Swiss population a 5G+ connection. According to the trade association asut, 4.5 million 5G devices were in operation in Switzerland at the end of 2022. As data usage continues to grow steadily, there are approximately 3200 new antenna applications waiting to be processed across the industry.

Broadband expansion: More fiber optics for the whole of Switzerland

By the end of 2025, Swisscom will increase fiber optic coverage (FTTH ) to 50-55%. FTTH coverage will be increased to 70-80% by 2030.

Private customers: Flexible and customizable subscriptions remain popular

At the end of 2022, 1.93 million customers in the private customer segment used blue travel plans. In this blue segment, it accounts for 46% of all mobile subscriptions and 80% of fixed broadband connections. Compared to the previous year, the number of fixed broadband connections fell by 0.5% to 2.03 million and the number of TV connections by 1.3% to 1.57 million.

Active postpaid connections in the mobile network increased by 166,000 compared to the previous year, while the number of prepaid connections decreased by 170,000. Overall, the number of Swisscom mobile network connections remained stable at 6.17 million.

While revenue from telecommunications services in the private customer segment has declined steadily in recent years, it remained stable at CHF 3,861 million (+0.2%) in 2022.

Commercial customers: growing in a highly competitive market environment

The business customer market continues to be characterized by price pressure and technological changes. Compared to the previous year, revenue from telecommunications services fell by 3.3% to CHF 1,588 million mainly due to price erosion. Swisscom enjoys a solid position as a full service provider and customer satisfaction is high. The demand for cloud, security, IoT and SAP solutions as well as business applications increased further. Revenue in the solutions business increased by 6.3% in 2022 to CHF 1,181 million.

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Fastweb is growing in terms of customers, turnover and EBITDA

Increased energy efficiency

Swisscom has been improving its electrical and energy efficiency for many years. In 2022, overall energy efficiency (electricity + fuels + fuels) in Switzerland increased by 4.5%. In addition, Swisscom saved a total of 20 GWh of electricity last year through technological improvements, efficiency-enhancing measures and phasing-outs. In addition, since 2022, Swisscom’s subscriptions and terminals have been climate-neutral.

New Head of Group Strategy & Business Development, change in the Board of Directors

As of 1 June 2023, Isa Müller-Wegner (45) will take up the position of Head of Group Strategy & Business Development, a new position within the Group Executive Board. Isa Müller-Wegner has worked for the last three years at Bain Capital managing portfolio companies (private equity) in various sectors. Previously, she was responsible for eBay’s multi-billion dollar business across much of Europe, including Italy, France, Spain and Turkey. In her international career she has also worked for Bain Consulting, the BBC and Arthur D Little. «Isa Müller-Wegner made a key contribution to successful growth strategies in various industries as an investor and advisor and operationally managed a highly digitized company. We look forward to working with Isa on the growth of Swisscom in Switzerland and abroad»declares the CEO Christopher Aeschlimann. Isa Müller-Wegner holds an MBA with honors from Harvard Business School and a Master of Arts (PPE) from the University of Oxford. She lives with her husband and two children outside Zurich.

The one-year term of office of all members of the Board of Directors will expire at the Annual General Meeting on 28 March 2023. As already communicated, Barbara Frei will not run for re-election. The Board of Directors proposes the election of Monique Bourquin as a new member of the body. The President and the other members of the Board of Directors stand for re-election. The payment of an unchanged dividend of CHF 22 per share for the 2022 financial year will be proposed to the Annual General Meeting on 28 March 2023.

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Outlook for 2023: EBITDA of CHF 4.6-4.7 billion

For the 2023 financial year, Swisscom expects net sales of CHF 11.1-11.2 billion, EBITDA of CHF 4.6-4.7 billion and capital expenditure of around CHF 2.3 billion. If the targets are achieved, Swisscom intends to propose to the 2024 Annual General Meeting an attractive and unchanged dividend for the 2023 financial year of CHF 22 per share.

Overview of key figures

1.1-31.12.2022 1.1-31.12.2021 Variation

rectified*

Net turnover (in million CHF) 11 112 11 183 -0,6%

(1,0%)

Operating result before depreciation, EBITDA (in million CHF) 4 406 4 478 -1,6%

(3,1%)

Operating result EBIT (in million CHF) 2 040 2 066 -1,3%
Net profit (in CHF million) 1 603 1 833 -12,5%
Retail broadband connections in Switzerland (as of 31 December, in thousands) 2 027 2 037 -0,5%
TV blue connections in Switzerland (as of 31.12, in thousands) 1 571 1 592 -1,3%
Mobile network connections in Switzerland (as of 12.31, in thousands) 6 173 6 177 -0,1%
Fastweb broadband connections (as of 12.31, in thousands) 2 683 2 750 -2,4%
Fastweb mobile network connections (as of 12.31, in thousands) 3 087 2 472 24,9%
Investments (in million CHF) 2 309 2 286 1,0%
Of which investments in Switzerland (in million CHF) 1 688 1 634 3,3%
Group collaborators (full-time positions as at 31.12) 19 157 18 905 1,3%
Of which employees in Switzerland (full-time positions as at 31.12) 15 750 15 882 -0,8%

* On a comparable basis and with a constant exchange rate

Swisscom uses various alternative performance indicators. For the definitions and reconciliation of values ​​according to IFRS, please refer to the management report of 31 December 2022.

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