STOCKHOLM, July 20 (Reuters) - Nordic telecom operator Telia Company said on Thursday it planned to cut costs by 5 percent in Sweden this year, and by at least 3 percent for the group next year, as it reported second-quarter core earnings just below forecast.
Telia said it planned to reduce its personnel and external consultants by 850 people, reducing costs in Sweden by 5 percent in the second half of 2017 year-on-year.
The company, which has 21,000 employees, also planned to reduce costs for the group by at least 3 percent in 2018.
“This is vital for a competitive Telia Company as we still see pressure on our legacy revenues and, as anticipated, falling one-off revenues from fibre,” CEO Johan Dennelind said in a statement.
The firm’s earnings before interest, tax, depreciation and amortisation (EBITDA) were 6.1 billion Swedish crowns ($734 million) excluding non-recurring items, down from 6.4 billion crowns a year ago and just below a mean forecast of 6.2 billion crowns in a Reuters poll.
Net sales fell 6.3 percent to 19.8 billion crowns versus a mean forecast of 19.7 billion crowns in the poll.
Telia raised its 2017 forecast for free cash flow to above 7.5 billion crowns from the previous guidance of above 7 billion crowns.
It repeated its forecast for an operating profit (EBITDA) and dividends around the level of 2016.
Reporting by Helena Soderpalm and Olof Swahnberg; Editing by Edmund Blair