TELENOR GROUP FOURTH QUARTER Jrgen C. Arentz Rostrup, CFO - PowerPoint PPT Presentation

TELENOR GROUP – FOURTH QUARTER Jørgen C. Arentz Rostrup, CFO

DISCLAIMER The following presentation is being made only to, and is only This presentation contains statements regarding the future in connection with the Telenor Group’s growth initiatives, profit directed at, persons to whom such presentation may lawfully be communicated (’relevant persons’). Any person who is not a figures, outlook, strategies and objectives. In particular, the slide “Outlook for 2017” contains forward-looking statements regarding relevant person should not act or rely on this presentation or any the Telenor Group’s expectations. All statements regarding the of its contents. Information in the following presentation relating to the price at which relevant investments have been bought or sold future are subject to inherent risks and uncertainties, and many in the past or the yield on such investments cannot be relied upon factors can lead to actual profits and developments deviating as a guide to the future performance of such investments. substantially from what has been expressed or implied in such statements. This presentation does not constitute an offering of securities or otherwise constitute an invitation or inducement to any person to underwrite, subscribe for or otherwise acquire securities in any company within the Telenor Group. The release, publication or distribution of this presentation in certain jurisdictions may be restricted by law, and therefore persons in such jurisdictions into which this presentation is released, published or distributed should inform themselves about, and observe, such restrictions. 2

HIGHLIGHTS 2016 FOURTH QUARTER FULL YEAR • • Revenues of NOK 33.1 bn (+1%) Revenues of NOK 131.4 bn (+1%) • • EBITDA of NOK 10.8 bn (+2%) EBITDA of NOK 46.5 bn (+5%) • • High investments in mobile and fibre Progress on transformation agenda networks • Free cash flow to equity of NOK 10.3 bn • Dividend of NOK 7.80 per share EBITDA before other items. Organic growth rates 3

Q4 2016 GOOD MOMENTUM ON FIBRE ROLL-OUT IN NORWAY AND SWEDEN NORWAY Norway - Revenues (NOK m) and EBITDA margin (%) • 3% mobile ARPU growth adj. for handset related effects 6 719 6 701 6 594 6 489 6 515 6 330 • 17% growth in high-speed broadband revenues 0% • Capex of NOK 1.5 bn, focused on 4G and fibre roll-out 45% 44% 45% 41% 40% 39% SWEDEN • 5% EBITDA growth, adj. for one-time effects Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 • 5% growth in fixed revenues, driven by fibre Sweden - Revenues (NOK m) and EBITDA margin (%) 3 409 3 188 3 121 3 080 3 072 3 082 DENMARK • 44,000 net mobile subscriber growth in continued highly -2% competitive environment 26% • 6% organic revenue decline and 12% EBITDA margin 34% 32% 32% 28% 29% 20% Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Organic growth assuming fixed currency, adjusted for acquisitions and Organic revenue growth. 4 disposals. EBITDA before other items. Sweden EBITDA % in Q4 16 adjusted for one-time effect

Q4 2016 PERFORMANCE IN CENTRAL AND EASTERN EUROPE IN LINE WITH TRENDS HUNGARY Hungary - Revenues (NOK m) and EBITDA margin (%) • 2% organic decline in subscription and traffic revenues 1 175 1 167 1 124 1 117 1 101 1 094 • 10% organic growth in EBITDA, driven by opex reduction -4% BULGARIA 36% 35% • 5% organic subscription and traffic revenue growth 32% 30% 27% 24% • Focus on pre to post migration in a highly competitive Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 environment Bulgaria - Revenues (NOK m) and EBITDA margin (%) • Awarded fastest mobile network in Bulgaria (Ookla) 827 815 809 772 768 SERBIA AND MONTENEGRO 758 5% • 1% organic revenue growth and 30% EBITDA margin • 254,000 net subscriber decline from seasonal prepaid churn 41% 40% 39% 38% 36% 35% Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Organic growth assuming fixed currency, adjusted for acquisitions and Organic revenue growth 5 disposals. EBITDA before other items.

Q4 2016 DOUBLE-DIGIT REVENUE GROWTH AND HEALTHY MARGINS IN EMERGING ASIA BANGLADESH (GRAMEENPHONE) Bangladesh - Revenues (NOK m) and EBITDA margin (%) • 12% organic subscription and traffic revenue growth 3 194 3 134 3 045 2 965 2 924 2 811 • 2.9 million net subscriber growth during Q4 11% • Leveraging on data position, supported by superior 3G network 57% 55% 55% 54% 55% 51% PAKISTAN • 10% organic subscription and traffic revenue growth Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 • 1.2 million net subscriber growth during Q4 Pakistan - Revenues (NOK m) and EBITDA margin (%) MYANMAR 2 265 2 175 2 144 2 141 2 049 1 988 • 20% organic revenue growth and 41% EBITDA margin 12% • 0.4 million net subscriber growth and 6% ARPU uplift vs Q3 46% 44% INDIA 43% 42% 40% 37% • Operating cash flow break-even following tight cost control Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Organic growth assuming fixed currency, adjusted for acquisitions and Organic revenue growth 6 disposals. EBITDA before other items.

Q4 2016 EBITDA GROWTH AND SOLID POSTPAID PERFORMANCE IN THAILAND AND MALAYSIA Thailand – Revenues (NOK m) and EBITDA margin (%) THAILAND (DTAC) • 15% organic growth in postpaid revenues 5 533 5 260 5 086 4 671 4 600 4 629 • 1% organic EBITDA growth amidst 3% decline in -8% subscription and traffic revenues 37% 36% 34% 33% • Lower regulatory cost offsetting prepaid device subsidies 31% 29% • 2,700 new 4G sites rolled out during the quarter Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Malaysia - Revenues (NOK m) and EBITDA margin (%) MALAYSIA (DIGI) • 14% organic growth in postpaid revenues 3 430 3 390 3 405 3 411 3 324 3 233 • 6% organic EBITDA growth amidst 2% decline in -3% subscription and traffic revenue • Improved margin on international traffic 48% 44% 45% 45% 42% 40% • 4G network reaching 85% population coverage Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Organic growth assuming fixed currency, adjusted for acquisitions and Organic growth 7 disposals. EBITDA before other items.

Q4 2016 1% ORGANIC REVENUE GROWTH AND 2% EBITDA GROWTH Revenues (NOK m) EBITDA (NOK m) and EBITDA margin (%) 12 459 33 487 33 013 33 144 32 794 32 477 11 848 31 836 11 685 11 545 10 860 10 793 1% 2% 38% 37% 35% 36% 32% 33% Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 • 1.2% organic growth adj. for one-time effect in Sweden • 4.8% organic growth adj. for one-time effect in Sweden • Organic revenue growth driven by emerging Asian operations • Organic EBITDA growth driven by increased contribution and improved momentum on fibre in Norway and Sweden from Bangladesh, Malaysia, Myanmar and India • Lower handset sale vs Q4 2015, especially in Thailand 8 Organic growth assuming fixed currency, adjusted for acquisitions and disposals.

Q4 2016 CAPEX OF NOK 6.9 BILLION, DRIVEN BY INVESTMENTS IN 3G/4G AND FIBRE Capex (NOK m) and capex/sales Capex distribution Other 6 887 Norway 6 530 13% Malaysia 22% 5 705 5 546 7% 5 252 5 017 Bangladesh 8% 21% Thailand 20% 18% 21% 17% 16% 15% Sweden 8% Pakistan Myanmar 9% 11% Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 • Full-year capex of NOK 23 bn, with capex/sales of 17.3% • Fibre capex in Norway and Sweden of around NOK 0.8 bn in Q4, and around NOK 2.5 bn for full year 2016 9 Capex and capex/sales ratio excl. licences

Q4 2016 CONSOLIDATED INCOME STATEMENT – Q4 AND FULL YEAR NOK m Q4 16 Q4 15 Year 2016 Year 2015 Revenues 33 144 33 487 131 427 128 175 EBITDA before other items 10 793 10 860 46 483 44 197 Other items - 326 -257 -1 380 -872 EBITDA 10 467 10 603 45 103 43 325 Depreciation and amortisation -5 094 -5 083 -20 050 -18 384 Impairment losses -1 187 -2 103 -7 983 -2 181 Operating profit 4 186 3 417 17 070 22 761 Associated companies 1 439 -2 835 -1 796 -6 819 Net financials -1 803 -980 -3 543 -2 921 Taxes -910 -995 -5 924 -6 317 Non-controlling interests 625 732 2 974 3 289 Net income to Telenor equity holders 2 286 -2 125 2 832 3 414 Earnings per share (NOK) 1.52 -1.42 1.89 2.27 10

Q4 2016 ADJUSTED* NET INCOME OF NOK 2.7 BILLION IN Q4 NOK m Reported Q4 16 Adjustment Adjusted Q4 16 • VAT provision Sweden Revenues 203 33 144 33 347 EBITDA before other items 251 10 793 11 044 • Workforce reductions (-355m) Other items - 326 326 0 • Scrapping (-457m) EBITDA 10 467 11 044 • Sale of property (+458m) Depreciation and amortisation -5 094 -5 094 • India capex (-155m) Impairment losses 1 187 - 1 187 0 • Tapad goodwill (-1.0 bn) Operating profit 4 186 5 951 • Reversal VimpelCom impairment Associated companies -1 528 1 439 -89 incl. share of Q3 net income Net financials -1 803 478 -1 325 • Loss on derivative Taxes -910 -274 -1 185 /exchangeable bond) Non-controlling interests 625 -23 648 Net income - Telenor equity holders 2 286 417 2 703 Earnings per share (NOK) 1.52 1.80 11 *Adjusted for Other items, impairment losses, VimpelCom and other one-time effects disclosed in our financial reporting