Financial outlook

In CHF million, except where indicated
w/o IFRS 16
Net revenue
Swisscom Group   11,714     (300)   ~ CHF 11.4 bn
Swisscom without Fastweb         (300)   ~ CHF 9.0 bn
Fastweb         > 0   > EUR 2.1 bn
Operating income before depreciation and amortisation (EBITDA)
Swisscom Group   4,213   ~200   < 0   > CHF 4.3 bn
Swisscom without Fastweb       ~180   < 0   < CHF 3.6 bn
Fastweb       ~20   > 0   > EUR 0.7 bn
Capital expenditure
Swisscom Group   2,404     < 0   ~ CHF 2.3 bn
Swisscom without Fastweb         < 0   ~ CHF 1.6 bn
Fastweb         < 0   ~ EUR 0.6 bn

For 2019, Swisscom expects net revenue of around CHF 11.4 bil­lion, EBITDA of over CHF 4.3 bil­lion and capital expenditure of around CHF 2.3 bil­lion. Due to strong competition and price pressure and the ongoing decline in the number of fixed-line telephone connections, Swisscom expects revenue to be slightly lower without Fastweb. Fastweb’s revenue is expected to increase slightly from 2018. The outlook for EBITDA in 2019 reflects the effect of a new accounting standard for leasing (IFRS 16) applicable from 2019 onwards. Under this standard, the costs for rental and leasing of property, plant and equipment are no longer recognised as operating expenses, but are instead capitalised as right-of-use assets and recognised as lease liabilities. Rental and lease costs are now recognised in the income statement below EBITDA as amortisation of right-of-use assets and interest on lease liabilities. This effect increases the reported EBITDA by around CHF 200 million. On a like-for-like basis and excluding the effects of IFRS 16, Group EBITDA will be lower in 2019 than in 2018. This has little impact on net income. For Swisscom, excluding Fastweb, the decline in revenue cannot be fully compensated by cost savings. In contrast, an increase in EBITDA is anticipated for Fastweb on a like-for-like basis. Capital expenditure in Switzerland, excluding costs for acquiring additional mobile radio frequencies at auction, will be slightly less than in the previous year. Fastweb’s capital expenditure is expected to be lower, because the EUR 64 million spent on mobile radio frequencies in 2018 will no longer recur. Subject to achieving its targets, Swisscom will propose payment of an unchanged, attractive dividend of CHF 22 per share for the 2019 financial year at the 2020 Annual General Meeting.