October 18, 2018 / 8:12 AM / in a month

Tele2 shares jump as third-quarter profits beat expectations

STOCKHOLM, Oct 18 (Reuters) - Swedish telecom operator Tele2 on Thursday raised its full-year profit forecast for the second consecutive quarter after producing third-quarter core earnings above analyst expectations, sending its shares higher.

Shares in Tele2, which competes with the likes of Telia Company, rose 6.9 percent in early trading in Stockholm on Thursday, taking year-to-date gains to 15 percent.

“The final quarter before the closing of the merger with Com Hem was once again a quarter of solid business trends, allowing us to make another upgrade of our full-year guidance,” Chief Executive Allison Kirkby said in a statement.

Kirkby, who is moving to become CEO at Danish telecoms company TDC, said business in Tele2’s home market Sweden had remained resilient, while earnings in smaller markets such as Lithuania and Croatia also topped forecasts.

Sweden accounts for more nearly 60 percent of Tele2 group sales.

The company reported third-quarter adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of 1.98 billion Swedish crowns ($220.36 million), up from 1.77 billion a year earlier, and beating the 1.88 billion crown mean forecast in a Reuters poll.

The company raised its 2018 core EBITDA forecast to 7.0-7.2 billion crowns, up from a previous range of 6.8-7.1 billion.

It said in January it had agreed a $3.2 billion takeover of cable TV company Com Hem, a deal expected to be completed in early November following approval from the European Commission. ($1 = 8.9855 Swedish crowns) (Reporting by Johannes Hellstrom. Editing by Jane Merriman)

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