Swisscom Switzerland
| In CHF million, except where indicated | 2020 | 2019 | Change | |||
|---|---|---|---|---|---|---|
| Net revenue and results | ||||||
| Telecom services | 5,667 | 5,952 | –4.8% | |||
| Solution business | 1,058 | 1,049 | 0.9% | |||
| Merchandise | 759 | 807 | –5.9% | |||
| Wholesale | 661 | 643 | 2.8% | |||
| Revenue other | 48 | 33 | 45.5% | |||
| Revenue from external customers | 8,193 | 8,484 | –3.4% | |||
| Intersegment revenue | 82 | 89 | –7.9% | |||
| Net revenue | 8,275 | 8,573 | –3.5% | |||
| Direct costs | (1,747) | (1,897) | –7.9% | |||
| Indirect costs | (3,001) | (3,192) | –6.0% | |||
| Segment expenses | (4,748) | (5,089) | –6.7% | |||
| Segment result before depreciation and amortisation (EBITDA) | 3,527 | 3,484 | 1.2% | |||
| Margin as % of net revenue | 42.6 | 40.6 | ||||
| Lease expense | (230) | (224) | 2.7% | |||
| Depreciation and amortisation | (1,509) | (1,515) | –0.4% | |||
| Segment result | 1,788 | 1,745 | 2.5% | |||
| Operating free cash flow proxy | ||||||
| Segment result before depreciation and amortisation (EBITDA) | 3,527 | 3,484 | 1.2% | |||
| Lease expense | (230) | (224) | 2.7% | |||
| EBITDA after lease expense (EBITDA AL) | 3,297 | 3,260 | 1.1% | |||
| Capital expenditure | (1,599) | (1,761) | –9.2% | |||
| Operating free cash flow proxy | 1,698 | 1,499 | 13.3% | |||
| Operational data in thousand and full-time equivalent employees | ||||||
| Fixed telephony access lines | 1,523 | 1,594 | –4.5% | |||
| Broadband access lines retail | 2,043 | 2,058 | –0.7% | |||
| TV access lines | 1,554 | 1,555 | –0.1% | |||
| Mobile access lines | 6,224 | 6,333 | –1.7% | |||
| Revenue generating units (RGU) | 11,344 | 11,540 | –1.7% | |||
| Broadband access lines wholesale | 555 | 515 | 7.8% | |||
| Headcount | 12,591 | 13,055 | –3.6% | |||
Net revenue for Swisscom Switzerland fell by CHF 298 million or 3.5% to CHF 8,275 million as a result of continuing competitive and price pressure and lower roaming revenues. To contain the Covid-19 pandemic, international travel was severely restricted. This led to a total decline in revenue of CHF 89 million in both telecommunications services and Wholesale. Revenue from telecommunications services decreased by CHF 285 million or 4.8% to CHF 5,667 million. Of this decline, CHF 164 million (–4.0%) was attributable to the Residential Customers segment and CHF 121 million (–6.6%) to the Business Customers segment. Revenue from the solutions business in Business Customers remained largely stable at CHF 1,058 million (+0.9%). Revenue was also affected by the high level of promotions. Sales of merchandise were unable to match the high volumes seen in 2019, with revenue falling by 5.9% to CHF 759 million. In Wholesale, revenue from external customers increased by 2.8%, with the increase in revenue due to higher demand for broadband connections and additional mobile network customers outweighing the decline in inbound roaming.
The number of inOne customers continues to grow. As at the end of 2020, Swisscom had 2.45 million inOne customers in the Residential Customers segment. In this segment, inOne accounts for 68% of postpaid mobile subscriptions and 76% of broadband connections. The market is showing signs of saturation in the area of mobile communications and fixed-network services, with the mobile subscriber base falling by 109,000 (–1.7%) to 6.22 million. The number of postpaid lines grew by 81,000, while the number of prepaid lines fell by 190,000. The number of broadband connections fell by 15,000 (–0.7%) to 2.04 million. There was also a shift to second and third brands. The number of TV connections remained stable at 1.55 million. In fixed-line telephony, the downward trend is slowing as the switch to IP technology has been completed. The number of fixed telephony access lines fell by 71,000 or 4.5% to 1.52 million.
Segment expense fell by CHF 341 million or 6.7% to CHF 4,748 million. Direct costs decreased by CHF 150 million or 7.9% to CHF 1,747 million, with costs for acquiring and retaining customers, roaming and purchasing merchandise all falling. In addition, the cost of broadcasting sporting events decreased because either such events were cancelled or will not take place until 2021 due to Covid-19. Indirect costs were CHF 191 million or 6.0% lower at CHF 3,001 million. Excluding the expense for headcount reductions, costs were reduced by CHF 129 million or 4.1%. This was mainly attributable to the declining headcount and lower advertising costs, while fewer customer service deployments as a result of the stable networks and platforms also reduced costs. Headcount fell as a result of efficiency measures by 464 FTEs or 3.6% to 12,591. The segment result before depreciation and amortisation was CHF 43 million or 1.2% higher at CHF 3,527 million. On an adjusted basis, EBITDA fell by CHF 19 million or 0.5% The decline in revenue was largely offset by ongoing cost-cutting measures.
Capital expenditure fell by 9.2% to CHF 1,599 million. The figure for the previous year included expenditure of CHF 196 million for mobile radio frequencies. Adjusted for this, capital expenditure increased by CHF 34 million or 2.2% due to higher spending on mobile network expansion and on the expansion of fibre-optic broadband in the fixed network. As at the end of 2020, 82% of all Swiss homes and businesses were connected with ultra-fast broadband exceeding 80 Mbps. 59% of all homes and businesses benefit from fast connections with bandwidths of more than 200 Mbps. Of these, more than 1.7 million have been upgraded to FTTH. Swisscom intends to make ultra-fast broadband available in every Swiss municipality by the end of 2021, even in remote locations. Swisscom also plans to double FTTH coverage for homes and businesses to up to 60% by the end of 2025 compared with 2019 levels.