In 2010, revenue in the TDC Group increased by DKK 88m or 0.3% to DKK 26,167m compared with 2009.
The TDC Group's revenue increase in 2010 resulted primarily from growth in domestic TV and mobility services and growth in TDC Nordic. The increased TV revenue was driven by a significant increase in demand for YouSee cableTV, add-on services and the success of the TDC triple-play product, HomeTrio. The growth in mobility services related to both increased mobile voice and data traffic and more mobile broadband customers. Furthermore, revenue was positively affected by foreign exchange-rate developments and the net impact from acquisitions and divestments. This was partly offset by lower domestic landline telephony in both the residential and business segments and lower domestic internet and network revenue related to the recent economic downturn and the introduction of the Danish multimedia tax. The impact from regulation of mobile termination rates (MTR), landline interconnection and international roaming charges also affected revenue negatively.
In 2010, gross profit in the TDC Group declined by DKK 215m or 1.1% to DKK 19,420m compared with 2009. The decline, which was caused primarily by decreased gross profit in landline telephony, and internet and network, terminal equipment and regulation of international roaming and landline interconnection, was only partly offset by an increase in domestic mobility services and TV as well as growth in TDC Nordic.
Despite the challenging market, EBITDA in the TDC Group increased to DKK 10,772m, up by DKK 236m or 2.2% compared with 2009, leading to an improved EBITDA margin of 41.2% in 2010, up by 0.8 percentage points. The growth in EBITDA resulted primarily from lower wages, salaries and pension costs and lower employee-related costs due to fewer FTEs, as well as acquisitions, exchange-rate developments and a positive development in pension income related to domestic defined benefit plans.
Profit for the year from continuing operations, excluding Special items, increased to DKK 2,888m, up by 161m or 5.9% compared with 2009. This was a result of higher EBITDA, currency adjustments and fair value adjustments that were only partly offset by increased depreciation and amortisation.
In 2010, profit for the year including special items increased to DKK 3,007m, up by DKK 624m or 26.2% compared with 2009, reflecting the positive effects of improved EBITDA and currency adjustments and fair value adjustments. This was partly offset by increased amortisation of the value of customer relationships from acquisitions and higher restructuring costs under Special items.
Cash flow from operating activities in continuing operations decreased by 2.7% to DKK 7,238m resulting primarily from higher income tax payments compared with 2009, which was only in part offset by a very positive development in net working capital. Operating free cash flow increased by 15.0% to DKK 7,437m and cash conversion improved by 7.6 percentage points to 69.0% in 2010, both due mainly to lower investments in property, plant and equipment and the positive development in net working capital.
Equity free cash flow increased by DKK 89m or 2.0% to DKK 4,515m also reflecting the positive change in net working capital, and despite a DKK 1.1bn higher income tax payment in 2010.
Net interest-bearing debt totalled DKK 22.6bn at year-end 2010, down DKK 10.9bn compared with year-end 2009. The significant debt reduction was possible by using the positive net cash flow from operating and investing activities as well as the proceeds from the divestment of Sunrise that remain after the DKK 9.0bn share buy-back in December 2010.
In January 2011, TDC achieved an investment grade credit rating.Til top