TDC NET annual report 2023: Improved operating profit and significant CO2 reductions
In line with expectations, TDC NET delivered improved financial results in 2023 compared to 2022. At the same time, we invested significantly in the continued development of our digital infrastructure and thus further supported the green, digital transition. Finally, we achieved historically high CO2 reductions and continued our course towards reaching net-zero emissions by 2030.
TDC NET has just published its annual report for 2023, which for the first time presents both the year's financial results and ESG results.
"With our 2023 report, we show that we are confidently continuing the course we have set out. We thus managed to deliver good financial results last year at the same time that we adjusted our organization, continued to expand our digital infrastructure for the benefit of the Danes and persistently worked on to decarbonize our business," says CFO at TDC NET, Henrik Nørgaard Brandt, and continues:
"We thus delivered on our guidance, improved our operating result and maintained a high level of investment. We also had a positive cash flow and in 2023 experienced great confidence from the markets in our strategy when we carried out two refinancings of a total of EUR 1 billion sustainability linked bonds”.
In addition, TDC NET's mobile network was measured for the eighth year in a row 'Denmark's best mobile network experience' in the Danish Technological Institute's annual survey. We now cover 99 percent of the country with 5G networks and operate and develop a strong, stable, and future-proof network.
"A number of important ESG results were also achieved in 2023, where, among other things, a 44 percent reduction in TDC NET's total CO2 emissions was achieved, which brings us well towards the goal of reaching net-zero in our own emissions in 2028 and in the entire value chain in 2030," explains Henrik Nørgaard Brandt.
Financial results for 2023
In the past year, TDC NET realized a turnover of DKK 6,461 million DKK, which was 2.7 percent lower than 2022 and primarily driven by a decline in traditional products such as landline telephony and low-speed copper broadband. EBITDA landed at DKK 4,695 million DKK, an increase of 3.9 percent compared to 2022 and driven by falling energy prices and adjustments in the organization. Operating costs fell compared to 2022 by 17.6 percent and thus amounted to DKK 1,530 million DKK last year.
Significant investments in the digital infrastructure of the future
Our investment level in 2023 was DKK 3,037 million DKK, the majority of which was spent on rolling out fiber connections, where we gave approximately 95,000 additional Danish households the opportunity to connect to our stable and lightning-fast fiber network. As a supplier of critical digital infrastructure in a time of increasing digital risks, we also continued our investments in a strong and robust network.
ESG results for 2023
In 2022, TDC NET became the first company in the world with an approved, science-based target to achieve 'net-zero' emissions from its own business by 2028 and from the entire value chain by 2030. In 2023, we reduced our Scope 1 and 2 emissions by 59 percent compared to 2022 and by 59 percent compared to the starting point in 2020. Scope 3 emissions decreased 5 percent compared to 2022 and 34 percent compared to 2020. The reduction targets are integrated into our business plan and form part of TDC NET's financing in the form of a total of DKK 1,500 million EUR in sustainability linked bonds.
"I am very satisfied that in 2023 we achieved such large reductions in emissions both in Scope 1, 2 and 3. Our close collaboration with the suppliers began to yield good results, and we benefited at the same time from the fact that we now have four solar parks in operation and thus could obtain approximately 70 percent of our power consumption from RE sources. In addition, in the ESG area, we launched a larger catalog of green initiatives in 2023, which we have started to implement. When it comes to diversity and inclusion, I unfortunately have to admit that we still have a long way to go. That work will continue in 2024 with an increased executive focus," says Henrik Nørgaard Brandt.
Financial expectations for 2024
In 2024, we expect to maintain the development from 2023 with growth in both mobile and high-speed broadband, which is, however, to some extent expected to be offset by falling demand for older products. We expect EBITDA for 2024 to be on par with 2023 largely driven by our focus on increasing efficiency and reducing the complexity of our processes. We continue to invest heavily in our end-to-end transformation while maintaining high investment levels within our core activities to maintain the good customer experience.