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Summary

Swisscom’s net revenue declined by CHF 25 million or 0.2% year-on-year to CHF 11,678 million. At constant exchange rates and excluding company acquisitions and disposals, Swisscom’s net revenue rose by CHF 83 million or 0.7%, largely due to the increased number of customers in the Swiss business (+1.4%) and at Italian subsidiary Fastweb (+6.2%). Adjusted revenue in the Swiss core business increased by CHF 57 million or 0.6%, while at Fastweb it rose by EUR 48 million or 2.8% in local currency terms.

Compared with the prior year, Swisscom increased its operating income before depreciation and amortisation (EBITDA), but its reported EBITDA fell by CHF 315 million or 7.1% to CHF 4,098 million as a result of one-off items. The main reason for this decline was the provision of CHF 186 million recognised for the Competition Commission proceedings on broadband services. Swisscom does not consider the penalty justified and has lodged an appeal with the Federal Supreme Court. Adjusted for this provision and other non-recurring items such as company acquisitions and disposals, provisions for headcount reduction, gains from the sale of real estate, non-cash pension expenses in accordance with IAS 19 and compensation from legal proceedings and on the basis of constant exchange rates, EBITDA increased by CHF 103 million or 2.3%. On a like-for-like basis, EBITDA in the Swiss business increased by CHF 21 million or 0.6%, while at Fastweb it rose by EUR 46 million or 8.9%. Net income declined by CHF 344 million or 20.2% to CHF 1,362 million, largely due to the above-mentioned non-recurring items in EBITDA. Earnings per share declined accordingly from CHF 32.70 to CHF 26.27. Payment of an unchanged dividend of CHF 22 per share for the 2015 financial year will be proposed to the Annual General Meeting.

Capital expenditure fell by CHF 27 million or 1.1% to CHF 2,409 million; however, if exchange rates had remained constant, an increase of CHF 47 million or 1.9% would have resulted. Capital expenditure in Switzerland increased by CHF 71 million or 4.1% year-on-year to CHF 1,822 million, largely due to broadband network expansion. As at the end of 2015, Swisscom had connected around 2.9 million households and businesses to its ultra-fast broadband service (speeds in excess of 50 Mbps). Of this number, around 2.0 million lines were equipped with the latest fibre-optic technology. Despite ending the year EUR 21 million or 3.7% lower at EUR 541 million, capital expenditure at Fastweb remained high due to progressive expansion and upgrading of the broadband network in Italy.

Operating free cash flow declined by CHF 16 million or 0.9% to CHF 1,844 million. Compared to the end of 2014, net debt fell by CHF 78 million or 1.0% to CHF 8,042 million.

Headcount increased year-on-year by 512 FTEs or 2.4% to 21,637 FTEs as a result of company acquisitions, new offerings such as cloud services and healthcare solutions. In addition, Swisscom insourced external staff in order to secure key knowledge in-house. In Switzerland headcount increased by 693 FTEs or 3.8% to 18,965. Excluding company acquisitions and disposals, the number of FTEs rose by 277 or 1.3%, in Switzerland by 258 FTEs or 1.4%.

For 2016, Swisscom expects net revenue in excess of CHF 11.6 bil­lion, EBITDA of around CHF 4.2 bil­lion and capital expenditure of more than CHF 2.3 bil­lion. For Swisscom (excluding Fastweb), a slight decline in revenue is expected due to heightened competition and price pressure. A slight increase in revenue is expected for Fastweb. Adjusted for the provisions recognised in 2015 for the legal proceedings on broadband services and for headcount reduction, EBITDA is expected to be around CHF 200 million lower for Swisscom (excluding Fastweb) year-on-year. In addition to the price-based decline in revenue, the costs for roaming are expected to increase in particular. EBITDA will be positively affected by approximately CHF 50 million in cost savings and growth at Fastweb. A slight reduction in capital expenditure in Switzerland of over CHF 1.7 bil­lion will result in a reduction in overall capital expenditure of over CHF 2.3 bil­lion. Subject to achieving its targets, Swisscom will propose an unchanged dividend of CHF 22 per share for the 2016 financial year at the 2017 Annual General Meeting.