Telecom service provider Tele2 AB today announced its plans to spend SEK 1 billion or $133 million to improve productivity and reduce costs.
A company statement does not talk about any job cut.
As part of the program, Tele2 expects to realize yearly productivity savings of around SEK 1 billion from 2018 onwards, following a multi-year investment program that is expected to cost around SEK 1 billion.
Tele2 has 14 million customers in 9 countries. In 2013, Tele2 had net sales of SEK 30 billion or $3.98 billion and reported an operating profit (EBITDA) of SEK 6 billion.
At the analyst and journalist briefing in London today, Tele2 announced the new program which will strengthen the organization further and enable it to continue to challenge the industry.
Mats Granryd, president and CEO of Tele2 AB, said: “Our business is growing and we spearheaded the transition into a data-centric business model. That puts us in a position of strength compared to the rest of the industry. We have the opportunity to invest and fully prepare for the future by the launch of our new strategy and The Challenger Program.”
20 percent of the planned investment of SEK 1 billion will be spent in Year 1, 50 percent in Year 2, and 30 percent in Year 3.
“Benefits will accrue at slightly slower pace to investments in Years 1 and 2, but achieve full run rate of SEK 1 billion between years 3 and 4. It is therefore expected that 2015 will be affected negatively by up to SEK 100 million,” Tele2 said.
