Edgar Filing: TELENOR ASA

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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934

Date: 16th February, 2005, for 4th Quarter, 2004

TELENOR ASA

(Registrant’s Name)

Snarøyveien 30,
1331 Fornebu,
Norway
(Registrant’s Address)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F : þ Form 40-F

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes No : þ

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):


TELENOR ASA FOURTH QUARTER 2004	delårsresultat	o282K	o276K	o62K
TEL RESULTS				o60K

Telenor`s revenues excluding gains increased by 14.2% to NOK 15.6 billion. EBITDA was NOK 4,519 million.Adjusted for special items, EBITDA was NOK 5,075 million. The EBITDA margin adjusted for special items was 32.5%. The operating loss was NOK 1,019 million.Adjusted for special items operating profit was NOK 2,087 million. Capex was NOK 4,122 million. Net debt was NOK 19.2 billion. The board will propose a dividend of NOK 1.50 per share for 2004

Telenor`s revenues excluding gains increased by 14.2% to NOK 15.6 billion. Several markets experienced high subscription growth, which led to record high 2.4 million new mobile subscriptions for Telenor. In Norway, there was a positive development in number of new mobile and ADSL subscriptions. This is a good basis for further improvement in profits. The moderate growth in adjusted EBITDA is a result of the strong focus on strengthening market positions and a weak quarter in Sonofon. The results in the fourth quarter of 2004 were strongly affected by a provision for a loss contract in Telenor Mobile Sweden and the write-downs related to Sonofon.

EBITDA was NOK 4,519 million, which is NOK 364 million lower than the fourth quarter of 2003. Adjusted for special items, EBITDA increased by NOK 211 million to NOK 5,075 million. The EBITDA margin adjusted for special items was 32.5%.

The operating loss was NOK 1,019 million, which is NOK 3,192 million lower than the fourth quarter of 2003. Operating loss was affected by write-downs related to Sonofon of NOK 2.4 billion. Adjusted for special items operating profit was NOK 2,087 million, which is NOK 136 million lower than the fourth quarter of 2003. Loss before taxes and minority interests was NOK 1,154 million, which is NOK 3,038 million lower than the fourth quarter of 2003. Adjusted for special items profit before taxes and minority interests increased by NOK 256 million to NOK 2,004 million. Earnings per share (EPS) was NOK - 0.22 compared to NOK 0.56 in the fourth quarter of 2003. The number of mobile subscriptions in consolidated operations increased by a total of 2.4 million during the fourth quarter of 2004 to 19.0 million compared to an increase of 0.9 million in the corresponding quarter last year. In the fourth quarter 2004, the number of subscriptions in companies in which Telenor has ownership interests increased by 7.5 million to 52.7 million at the end of 2004. Revenues in Mobile increased by NOK 2,344 million or 37.1% to NOK 8,655 million. EBITDA decreased by NOK 155 million to NOK 2,339 million due to the strong market focus and provision for a loss contract in Telenor Mobile Sweden.

During the fourth quarter of 2004, Telenor Mobil – Norway increased the number of GSM subscriptions by 87,000. Telenor`s estimated market share for mobile services in Norway was stable at 56% measured in number of subscriptions. Telenor Mobil launched third generation mobile services (UMTS) on December 1, 2004, as the first operator in Norway.

In Fixed-Norway, revenues adjusted for disposal of operations and special items decreased by 2.1%. Adjusted EBITDA margin was 35.8%, which was in line with the fourth quarter of 2003. Operating profit increased by NOK 131

million to NOK 699 million. The market share for fixed line telephony in Norway measured in traffic minutes has been stable at 69% from the end of 2003. The number of ADSL subscriptions had a strong increase in the fourth quarter of a total of 56,000 to 326,000.

In Broadcast, the number of subscribers with satellite dish at the end of 2004 was 824,000 in the Nordic area. EBITDA in the fourth quarter of 2004 was NOK 333 million. Capital expenditure was NOK 4,122 million compared to NOK 2,450 million in the fourth quarter of 2003. This was primarily a consequence of increased network investments in Mobile due to strong subscriber growth and Pannon GSM`s purchase of a UMTS license in Hungary.

Net interest-bearing liabilities were NOK 19.2 billion, a decrease of NOK 1.4 billion from the third quarter of 2004. Profit before taxes and minority interests for the year 2004 was NOK 8.8 billion compared to NOK 7.4 billion in 2003. Adjusted for special items, there was an increase of NOK 3.0 billion to NOK 9.3 billion in 2004. This was primarily due to increased operating profit, adjusted for special items, in all business areas. In addition, net result from associated companies and net financial items, adjusted for special items, grew. Capital expenditure in 2004 amounted to NOK 12.7 billion, which was an increase of NOK 6.3 billion. The increase is primarily related to increased investments in network capacity of international mobile operations due to strong growth in the number of subscriptions. In addition, capital expenditure in 2004 included the purchase of a licence for mobile telephony in Pakistan and a UMTS licence in Hungary at a total cost of NOK 2.4 billion and the purchase of an ownership interest in a satellite of NOK 0.6 billion in Broadcast. The board will propose a dividend of NOK 1.50 per share for 2004, an increase from NOK 1.00 per share in 2003. In order to simplify and strengthen Telenor`s position in the Nordic market, a separate Nordic management entity was established effective 26 January 2005, which comprise the mobile and fixednetwork activities.

On 28 January 2005, Telenor sold 6.9 million shares in Intelsat for a price of 18.75 US Dollar per share. The sale resulted in a gain before taxes of NOK 403 million.

OUTLOOK

The strong growth in revenues and subscriptions during 2004 gives Telenor a good basis for further improvement of profits. A continued high growth in revenue and EBITDA is expected, in particular driven by the international mobile operations. Telenor will continue previously implemented cost efficiency activities and identify new initiatives. This will compensate for intensified competition and costs related to new operations. High capital expenditure is expected for 2005, in which capital expenditure in proportion of revenues is expected to be in line with or slightly exceed 2004. Capital expenditure is driven by considerable network investments in Kyivstar, Telenor Pakistan, GrameenPhone and DiGi.Com. In addition, we expect further UMTS investments.

For Telenor`s mobile operations, a high growth in revenues and EBITDA is expected to continue in 2005. We will implement cost reductions and improvements, in particular within our Nordic operations.

In Fixed-Norway, revenue and EBITDA is anticipated to slightly decrease. The strong growth in the number of ADSL subscriptions is expected to continue. This fact, in addition to increased revenues from wholesale, does not

fully offset decreased revenues from PSTN/ISDN. In Broadcast and other units, we expect EBITDA to improve in 2005 compared to 2004.

A continuously increasing share of Telenor`s revenues and profits come from operations outside Norway. Currency fluctuations will to an increasing extent influence the reported figures in Norwegian Krone. Political risk, including regulatory conditions, might also influence the profits.

Telenor anticipates that profits exclusive special items, overall will grow in 2005 compared to 2004.

TABLE OF CONTENTS


SIGNATURES

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


		Telenor ASA

		By:
		Name: Torstein Moland
		(sign.)
		Title: CFO

Date: 16^th February, 2005

FOURTH QUARTER OF 2004

The fourth quarter of 2004 showed a growth in revenues excluding gains for the Telenor Group of 14.2% to NOK 15.6 billion compared to the fourth quarter of 2003. Loss before taxes and minority interests was NOK 1.2 billion.

(TELENOR LOGO)

Telenor ASA fourth quarter of 2004

KEY POINTS FROM THE FOURTH QUARTER OF 2004 COMPARED TO THE FOURTH QUARTER OF 2003

•

Telenor’s revenues excluding gains increased by 14.2% to NOK 15.6 billion. Several markets experienced high subscription growth, which led to record high 2.4 million new mobile subscriptions for Telenor. In Norway, there was a positive development in number of new mobile and ADSL subscriptions. This is a good basis for further improvement in profits. The moderate growth in adjusted EBITDA is a result of the strong focus on strengthening market positions and a weak quarter in Sonofon. The results in the fourth quarter of 2004 were strongly affected by a provision for a loss contract in Telenor Mobile Sweden and the write-downs related to Sonofon.

•	EBITDA was NOK 4,519 million, which is NOK 364 million lower than the fourth quarter of 2003. Adjusted for special items *), EBITDA increased by NOK 211 million to NOK 5,075 million. The EBITDA margin adjusted for special items was 32.5%.

•

Loss before taxes and minority interests was NOK 1,154 million, which is NOK 3,038 million lower than the fourth quarter of 2003. Adjusted for special items profit before taxes and minority interests increased by NOK 256 million to NOK 2,004 million. Earnings per share (EPS) was NOK -0.22 compared to NOK 0.56 in the fourth quarter of 2003.

•

The number of mobile subscriptions in consolidated operations increased by a total of 2.4 million during the fourth quarter of 2004 to 19.0 million compared to an increase of 0.9 million in the corresponding quarter last year. In the fourth quarter 2004, the number of subscriptions in companies in which Telenor has ownership interests increased by 7.5 million to 52.7 million at the end of 2004. Revenues in Mobile increased by NOK 2,344 million or 37.1% to NOK 8,655 million. EBITDA decreased by NOK 155 million to NOK 2,339 million due to the strong market focus and provision for a loss contract in Telenor Mobile Sweden.

•

During the fourth quarter of 2004, Telenor Mobil – Norway increased the number of GSM subscriptions by 87,000. Telenor’s estimated market share for mobile services in Norway was stable at 56% measured in number of subscriptions. Telenor Mobil launched third generation mobile services (UMTS) on December 1, 2004, as the first operator in Norway.

•

In Fixed – Norway, revenues adjusted for disposal of operations and special items decreased by 2.1%. Adjusted EBITDA margin was 35.8%, which was in line with the fourth quarter of 2003. Operating profit increased by NOK 131 million to NOK 699 million. The market share for fixed line telephony in Norway measured in traffic minutes has been stable at 69% from the end of 2003. The number of ADSL subscriptions had a strong increase in the fourth quarter of a total of 56,000 to 326,000.

•	In Broadcast, the number of subscribers with satellite dish at the end of 2004 was 824,000 in the Nordic area. EBITDA in the fourth quarter of 2004 was NOK 333 million.

•	Capital expenditure was NOK 4,122 million compared to NOK 2,450 million in the fourth quarter of 2003. This was primarily a consequence of increased network investments in Mobile due to strong subscriber growth and Pannon GSM’s purchase of a UMTS license in Hungary.

•	Net interest-bearing liabilities were NOK 19.2 billion, a decrease of NOK 1.4 billion from the third quarter of 2004.

•

Profit before taxes and minority interests for the year 2004 was NOK 8.8 billion compared to NOK 7.4 billion in 2003. Adjusted for special items, there was an increase of NOK 3.0 billion to NOK 9.3 billion in 2004. This was primarily due to increased operating profit, adjusted for special items, in all business areas. In addition, net result from associated companies and net financial items, adjusted for special items, grew. Capital expenditure in 2004 amounted to NOK 12.7 billion, which was an increase of NOK 6.3 billion. The increase is primarily related to increased investments in network capacity of international mobile operations due to strong growth in the number of subscriptions. In addition, capital expenditure in 2004 included the purchase of a licence for mobile telephony in Pakistan and a UMTS licence in Hungary at a total cost of NOK 2.4 billion and the purchase of an ownership interest in a satellite of NOK 0.6 billion in Broadcast.

•	The board will propose a dividend of NOK 1.50 per share for 2004, an increase from NOK 1.00 per share in 2003.

•

Telenor will prepare its financial statements in accordance with IFRS from the first quarter of 2005, with comparable figures for 2004.The most significant difference between IFRS and Norwegian GAAP is that goodwill is not amortized according to IFRS, but is subject to an impairment test on an annual basis or whenever there is an indication of impairment. In addition, the allocation of group overhead costs will be changed in such a way that a greater share of the costs will be charged the operating units directly.

•	In order to simplify and strengthen Telenor’s position in the Nordic market, a separate Nordic management entity was established effective 26 January 2005, which comprise the mobile and fixed-network activities.

•	On 28 January 2005, Telenor sold 6.9 million shares in Intelsat for a price of 18.75 US Dollar per share. The sale resulted in a gain before taxes of NOK 403 million.

*⁾	See table “special items” (gains and losses on disposal, expenses for workforce reductions, loss contracts, exit from activities and write-downs) page 19.

KEY FIGURES


	4th quarter						Year
(Beløp i millioner kroner)	2004			2003			2004		2003

Revenues		15,713			13,801			61,302		53,121
Revenues excluding gains		15,608			13,671			60,752		52,889
Revenues excluding gains – growth (%)		14.2			12.0			14.9		8.7
EBITDA ¹⁾		4,519			4,883			20,821		18,302
EBITDA/Revenues (%)		28.8			35.4			34.0		34.5
EBITDA excluding gains and losses ²⁾		4,407			4,781			20,345		18,299
Operating profit (loss)		(1,019	)		2,173			6,602		7,560
Operating profit/Revenues (%)	nm				15.7			10.8		14.2
Associated companies		82			(179	)		718		1,231
Profit (loss) before taxes and minority interests		(1,154	)		1,884			8,846		7,426
Net income		(382	)		999			5,228		4,560
Net income per share in NOK – basic and diluted		(0.22	)		0.56			2.99		2.57

Net interest-bearing liabilities								19,195		17,817

Investments:
- Capex ³⁾		4,122			2,450			12,745		6,454
- Investments in businesses ⁴⁾		1,122			263			5,809		563

¹⁾		For a definition and reconciliation of EBITDA, see table at the end of this report.

²⁾		See table “special items” on page 19 for further details.

³⁾		Capex is investments in tangible and intangible assets.

⁴⁾		Consists of acquisition of shares and participations including acquisition of subsidiaries and businesses not organized as separate companies.

The table below shows key figures adjusted for special items (gains and losses on disposal, expenses for workforce reductions, loss contracts, exit from activities and write-downs) ^{1) 2)}


			4th quarter								Year
(NOK in millions)	2004		2003			Growth			2004		2003			Growth

Revenues		15,608		13,671			14.2	%		60,752		52,889			14.9	%
EBITDA		5,075		4,864			4.3	%		21,243		18,586			14.3	%
EBITDA/Revenues (%)		32.5		35.6						35.0		35.1
Operating profit		2,087		2,223			(6.1	%)		9,620		7,989			20.4	%
Operating profit/Revenues (%)		13.4		16.3						15.8		15.1
Associated companies		67		(164	)	nm				686		(251	)	nm
Profit before taxes and minority interests		2,004		1,748			14.6	%		9,268		6,300			47.1	%

¹⁾		See table “special items” on page 19 for further details.

²⁾		Adjusted for the effects of acquisitions and disposals of operations and currency fluctuations, the growth in revenues was 6%.

KEY FIGURES FOR THE BUSINESS AREAS

Revenues


				4th quarter									Year
(NOK in millions)	2004			2003			Growth			2004			2003			Growth

Mobile		8,655			6,311			37.1	%		32,952			23,810			38.4	%
Fixed		4,793			5,175			(7.4	%)		19,266			20,509			(6.1	%)
Broadcast		1,375			1,310			5.0	%		5,347			4,820			10.9	%
Other activities		2,571			2,797			(8.1	%)		10,318			10,811			(4.6	%)
Eliminations		(1,681	)		(1,792	)		(6.2	%)		(6,581	)		(6,829	)		(3.6	%)
Total revenues		15,713			13,801			13.9	%		61,302			53,121			15.4	%

EBITDA


			4th quarter											Year
(NOK in millions)	2004		Margin ¹⁾			2003			Margin ¹⁾			2004		Margin ¹⁾			2003		Margin ¹⁾

Mobile		2,339		27.0	%		2,494			39.5	%		11,618		35.3	%		9,567		40.2	%
Fixed		1,552		32.4	%		1,622			31.3	%		6,277		32.6	%		6,665		32.5	%
Broadcast		333		24.2	%		379			28.9	%		1,495		28.0	%		1,229		25.5	%
Other activities		257		10.0	%		377			13.5	%		1,367		13.2	%		830		7.7	%
Eliminations		38	nm				11		nm				64	nm				11	nm
Total EBITDA		4,519		28.8	%		4,883			35.4	%		20,821		34.0	%		18,302		34.5	%

Special items ²⁾		556					(19	)					422					284
EBITDA adjusted for special items ³⁾		5,075		32.5	%		4,864			35.6	%		21,243		35.0	%		18,586		35.1	%

¹⁾		EBITDA as a percentage of total revenues.

²⁾		Gains, losses, expenses for workforce reductions, loss contracts and exit from activities. See table “special items” on page 19 for further details.

³⁾		Margin is EBITDA adjusted for special items as a percentage of revenues excluding gains.

Operating profit (loss)


				4th quarter												Year
(NOK in millions)	2004			Margin ¹⁾			2003			Margin ¹⁾			2004		Margin ¹⁾			2003			Margin ¹⁾

Mobile		(1,789	)	nm				1,432			22.7	%		3,027		9.2	%		5,224			21.9	%
Fixed		699			14.6	%		568			11.0	%		2,794		14.5	%		2,531			12.3	%
Broadcast		101			7.3	%		132			10.1	%		589		11.0	%		181			3.8	%
Other units		(32	)	nm				(6	)	nm				169		1.6	%		(488	)	nm
Eliminations		2		nm				47		nm				23	nm				112		nm
Total operating profit (loss)		(1,019	)	nm				2,173			15.7	%		6,602		10.8	%		7,560			14.2	%

¹⁾

Operating profit as a percentage of total revenues

BUSINESS AREAS

MOBILE


	4th quarter					Year
(NOK in millions)	2004			2003		2004		2003

External revenues
Telenor Mobil – Norway		2,690			2,351		10,508		9,639
Sonofon – Denmark		1,166			—		4,346		—
Telenor Mobile Sweden		36			27		136		109
Pannon GSM – Hungary		1,497			1,464		5,858		5,368
DiGi.Com – Malaysia		1,002			880		3,950		3,170
Kyivstar – Ukraine		1,233			801		4,344		2,634
GrameenPhone – Bangladesh		573			433		2,202		1,535
ProMonte GSM – Montenegro		117			—		199		—
Other		8			7		22		28
Total external revenues		8,322			5,963		31,565		22,483

Internal revenues		331			348		1,382		1,327
Gains on disposal		2			—		5		—
Total revenues		8,655			6,311		32,952		23,810


EBITDA		2,339			2,494		11,618		9,567
Depreciation and amortization		1,613			1,056		6,072		4,308
Write-downs		2,515			6		2,519		35
Operating profit (loss)		(1,789	)		1,432		3,027		5,224


EBITDA/Total revenues (%)		27.0			39.5		35.2		40.2
Operating profit/Total revenues (%)	nm				22.7		9.1		21.9

Investments:
- Capex		3,199			1,421		9,427		3,667
- Investments in businesses		327			90		4,711		95

•	Revenues increased by 37.1% compared to the fourth quarter of 2003 due to underlying growth and consolidation of Sonofon and ProMonte. Adjusted for acquisitions, disposals of operations and currency fluctuations, the revenue growth was 16%.

•	EBITDA decreased by 6.7% compared to the fourth quarter of 2003,primarily due to provision for loss on the MVNO agreement in Sweden. Price reductions and increased costs due to marketing activities as well as the consolidation of Sonofon further decreased the EBITDA margin compared to the fourth quarter of 2003.

•	The fourth quarter of 2004 included write-downs related to Sonofon and Telenor Mobile Sweden.

•	Capital expenditure included increased network investments, particularly in Kyivstar and GrameenPhone, to meet the strong subscriber growth, as well as the purchase of a UMTS license in Hungary by Pannon GSM.

•	Investments in businesses in the fourth quarter of 2004 were related to the purchase of additional shares in GrameenPhone that increased the ownership share to 62.0% at the end of 2004. Telenor now owns the company in partnership with Grameen Telecom.

TELENOR MOBIL – NORWAY


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003

Subscriptions and connections		437		305		1,533		1,216
Traffic		1,385		1,258		5,568		5,329
SMS, MMS and content services		416		384		1,595		1,599
Customer equipment, service
providers and other		452		404		1,812		1,495
Total external revenues		2,690		2,351		10,508		9,639

Internal revenues		290		318		1,226		1,270
Total revenues		2,980		2,669		11,734		10,909


EBITDA		1,109		982		4,283		4,262
Depreciation and amortization		279		276		1,056		1,147
Write-downs		10		—		14		—
Operating profit		820		706		3,213		3,115


EBITDA/Total revenues (%)		37.2		36.8		36.5		39.1
Operating profit/Total revenues (%)		27.5		26.5		27.4		28.6
Capex		172		236		973		500
ARPU (GSM) – monthly (NOK)		330		326		339		339
No. of subscriptions (in thousand)						2,645		2,364

•	During the fourth quarter of 2004 Telenor Mobil had a net increase of 87,000 GSM subscriptions, of which 36,000 were contract subscriptions.

•	The estimated market share for mobile subscriptions was approximately 56% at the end of 2004, in line with the third quarter of 2004. Mobile penetration was estimated at 102%, up from 99% in the third quarter of 2004.

•	Increased revenues compared to the fourth quarter of 2003 is primarily related to increased number of subscriptions, increased traffic per subscription and increased revenues from traffic sold on a wholesale basis, partially offset by price reductions. In addition, revenues have been affected positively by accruals between the quarters.

•	Average revenue per subscription (ARPU), adjusted for accruals between the quarters, decreased by NOK 4 in the fourth quarter of 2004 compared to the fourth quarter of 2003, primarily due to reduced average prices for voice services and SMS.

•	The EBITDA margin adjusted for accruals between the quarters was in line with the fourth quarter of 2003. The increase in revenues was partially offset by increased costs associated with sales and marketing activities

•	In the fourth quarter of 2004, Telenor Mobil recognised discounts on equipment associated with investments during 2004, which contributed to the decrease in capital expenditure. Investments in new technology increased compared to the fourth quarter of 2003.

•	On 1 December 2004, Telenor Mobil was the first operator in Norway to launch third generation mobile services (UMTS).

SONOFON – DENMARK


	4th quarter					Year
(NOK in millions)	2004			2003		2004			2003

Mobile related revenues		936			—		3,369			—
Other revenues		244			—		1,024			—
Total revenues		1,180			—		4,393			—


EBITDA		20			—		680			—
Depreciation and amortization		122			—		642			—
Write-downs		215			—		215			—
Operating (loss)		(317	)		—		(177	)		—


EBITDA/Total revenues (%)		1.7			—		15.5			—
Capex		76			—		388			—
ARPU (GSM) – monthly (NOK)		224			—		248			—
No. of subscriptions (in thousand)							1,286			—

Telenor’s ownership interest in Sonofon was 100% at the end of 2004. The Norwegian Krone appreciated against the Danish Krone by approximately 2% in the fourth quarter of 2004 compared to the third quarter of 2004. The preceding table shows figures included in the accounts for Telenor from 12 February 2004, the date of consolidation of Sonofon. ARPU for the year 2004 in the table is for the period 1 January-31 December 2004.

•	Sonofon’s estimated market share was 27% at the end of 2004, in line with the previous quarter. The estimated mobile penetration in Denmark was 88% at the end of 2004 compared to 87% at the end of the third quarter of 2004 (measured by using three months churn for prepaid subscriptions for all operators).

•	During the quarter, the number of subscriptions in Sonofon increased by 23,000.

•	ARPU decreased by 5% compared to the third quarter 2004, measured in local currency, primarily as a result of price reductions.

•	EBITDA in the fourth quarter 2004 decreased due to high costs associated with sales and marketing activities to respond to the intensified competition. In addition, EBITDA in the fourth quarter of 2004 was negatively affected by costs for workforce reductions and costs that were recorded as capital expenditure in the previous quarters of 2004. This expense contributed to a decrease in capital expenditure for the fourth quarter of 2004.

•	Revenues and the EBITDA margin for the full year 2004 were NOK 4,927 million and 16%, respectively.

•	Write-downs included in the fourth quarter of 2004 were primarily related to the fixed network operation. Write-downs of Telenor’s excess values are included in “Other units in Mobile”.

TELENOR MOBILE SWEDEN


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003

Total revenues		61			44			223			127


EBITDA		(619	)		(36	)		(725	)		(114	)
Depreciation and amortization		26			7			49			24
Write-downs		75			—			75			—
Operating (loss)		(720	)		(43	)		(849	)		(138	)


Capex		6			4			17			79
ARPU (GSM) – monthly (NOK)		195			199			201			171
No. of subscriptions (in thousand)								105			81

The Norwegian Krone was stable against the Swedish Krone in the fourth quarter of 2004 compared to the fourth quarter of 2003.

•	Compared to the fourth quarter of 2003, revenues increased as a result of the increased number of subscriptions.

•	The increase in EBITDA loss compared to the fourth quarter of 2003 was primarily due to provision for loss on the MVNO agreement in Sweden. In 2002, Telenor entered into an MVNO agreement (Mobile Virtual Network Operator) with Tele2 to purchase mobile network capacity in Sweden, as an alternative to a service provider agreement. The MVNO agreement is partially a fixed price agreement. As a consequence of the revised expectations of the usage of the capacity in the MVNO agreement, Telenor expensed NOK 562 million as loss on this contract in the fourth quarter of 2004. In addition, Telenor made a write-down of fixed assets in Sweden by NOK 75 million.

•	Depreciation associated with phasing out the service provider operation was included in the fourth quarter of 2004. From March 2005, Telenor Mobile Sweden will provide all mobile services as a MVNO.

PANNON GSM – HUNGARY


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003

Mobile related revenues		1,384		1,326		5,499		5,005
Other revenues		118		138		370		365
Total revenues		1,502		1,464		5,869		5,370


EBITDA		419		435		2,092		1,924
Depreciation and amortization		221		231		935		889
Write-downs		21		4		21		10
Operating profit		177		200		1,136		1,025


EBITDA/Total revenues (%)		27.9		29.7		35.6		35.8
Operating profit/Total revenues (%)		11.8		13.7		19.4		19.1
Capex		820		200		1,166		644
ARPU (GSM) – monthly (NOK)		174		173		176		165
No. of subscriptions (in thousand)						2,770		2,618

Telenor’s ownership interest in Pannon GSM is 100%. The Norwegian Krone depreciated against the Hungarian Forint by approximately 5% in the fourth quarter of 2004 compared to the fourth quarter of 2003.

•	The number of subscriptions increased by a total of 175,000 during the quarter, of which 70,000 were contract subscriptions.

•

Pannon GSM’s estimated market share at the end of the quarter was approximately 34%, up 1 percentage point from the previous quarter. Compared to the end of the third quarter of 2004, the estimated mobile penetration in Hungary increased by approximately 3 percentage points to 80% (measured by using three months churn for prepaid subscriptions for all operators).

•	ARPU measured in local currency decreased by 4.5% compared to fourth quarter 2003, primarily due to price reductions, partially offset by increased usage per subscription and increased number of contract subscriptions.

•	The decrease in EBITDA margin compared to fourth quarter 2003 was primarily due to price reductions and increased interconnection costs.

•	Depreciation and amortization decreased compared to the fourth quarter of 2003 due to fixed assets being entirely depreciated. The UMTS license will be amortized over 15 years starting from 2005.

•	Increased capital expenditure compared to the fourth quarter of 2003 was primarily related to the purchase of a UMTS license and upgrading the GSM network to EDGE functionality.

•	On 8 December 2004, Pannon GSM acquired a UMTS licence for NOK 630 million, of which NOK 180 million was paid in 2004 and the remaining will be paid in three yearly installments. The licence also includes GSM 1800-frequencies.

DIGI.COM – MALAYSIA


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
Mobile related revenues		894		752		3,437		2,713
Other revenues		108		130		516		463
Total revenues		1,002		882		3,953		3,176


EBITDA		442		386		1,732		1,295
Depreciation and amortization		198		201		829		780
Write-downs		—		3		—		18
Operating profit		244		182		903		497


EBITDA/Total revenues (%)		44.1		43.8		43.8		40.8
Operating profit/Total revenues (%)		24.4		20.6		22.8		15.6
Capex		427		530		920		1,043
ARPU (GSM) – monthly (NOK)		100		117		110		117
No. of subscriptions (100% in thousand)						3,242		2,207

Telenor’s ownership interest in DiGi.Com was 61.0% at the end of 2004. The Norwegian Krone appreciated against the Malayan Ringgit by approximately 8% in the fourth quarter of 2004 compared to the fourth quarter of 2003.

•	There was a strong increase in the number of subscriptions in the fourth quarter of 2004. The increase was 436,000 in the quarter and more than 1 million compared to the end of 2003.

•	DiGi.Com increased its estimated market share by 0.5 percentage points from the previous quarter to 22%. The estimated mobile penetration in Malaysia was 57% at the end of 2004 compared to 52% at the end of third quarter 2004.

•	ARPU measured in local currency decreased by approximately 8% compared to the fourth quarter of 2003 as a result of on average reduced prices and lower usage per subscription. Lower average usage is due primarily to high growth in subscriptions towards the end of the quarter.

•	Revenues increased by 25% compared to the fourth quarter of 2003, when measured in local currency, which was driven by the increase in the number of subscriptions.

•	The EBITDA margin was in line with the fourth quarter of 2003. Measured in local currency, EBITDA increased by 26% compared to the fourth quarter of 2003.

•	Compared to the fourth quarter of 2003, depreciation and amortization increased, when measured in local currency, as a result of high capital expenditure in the intervening quarters.

•	Capital expenditure was related to investments in networks to increase coverage and serve a larger customer base, as well as upgrading the network to EDGE functionality.

•	The mobile operators in Malaysia are required to provide a certain level of national coverage by the end of 2005 and 2006, but the Malaysian authorities have not yet set out all conditions.

KYIVSTAR – UKRAINE


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
Mobile related revenues		1,213		786		4,278		2,569
Other revenues		21		15		68		65
Total revenues		1,234		801		4,346		2,634


EBITDA		713		507		2,581		1,573
Depreciation and amortization		136		95		462		343
Operating profit		577		412		2,119		1,230


EBITDA/Total revenues (%)		57.8		63.3		59.4		59.7
Operating profit/Total revenues (%)		46.8		51.4		48.8		46.7
Capex		1,024		259		2,608		979
ARPU (GSM) – monthly (NOK)		72		95		90		94
No. of subscriptions (100% in thousand)						6,252		3,037

Telenor’s ownership interest at the end of 2004 was 56.51%. The Norwegian Krone appreciated against the Ukrainian Hryvnia (UAH) by approximately 7% in the fourth quarter of 2004 compared to the fourth quarter of 2003. Previously, the US Dollar was the functional currency for Kyivstar. In 2004, when the company changed its nominal prices from US Dollar to local currency (UAH), Ukrainian Hryvnia was adopted as the functional currency. This change has not had any material effect on the financial figures as the exchange rate between US Dollar and Ukrainian Hryvnia has been stable.

•	Kyivstar experienced high growth and more than doubled the customer base during 2004. The number of subscriptions increased by more than 1.4 million during the fourth quarter of 2004 and by more than 3.2 million compared to the end of 2003.

•	Kyivstar’s estimated market share decreased by 1 percentage point from the previous quarter to 45% at the end of 2004. Compared to the third quarter of 2004, the estimated mobile penetration in Ukraine increased from 22% to 29%.

•	ARPU measured in local currency decreased by approximately 18% compared to the fourth quarter of 2003. This was due to the high customer growth as well as price reductions.

•	Revenues increased compared to the fourth quarter of 2003 primarily due to the increase in the number of subscriptions.

•	The decrease in EBITDA margin was primarily a result of lower prices without costs of materials and traffic charges decreasing correspondingly. Measured in local currency, EBITDA increased by 54% compared to the fourth quarter of 2003.

•	Compared to the fourth quarter of 2003, depreciation and amortization increased as a result of increased capital expenditure in the intervening quarters.

•	Increased capital expenditure compared to the fourth quarter of 2003 was due to network investments required by the large increase in the customer base and to improve coverage.

GRAMEENPHONE – BANGLADESH


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
Mobile related revenues		573		432		2,194		1,529
Other revenues		—		1		8		7
Total revenues		573		433		2,202		1,536


EBITDA		338		309		1,313		1,001
Depreciation and amortization		72		41		215		158
Write-downs		3		—		3		—
Operating profit		263		268		1,095		843


EBITDA/Total revenues (%)		59.0		71.4		59.6		65.2
Operating profit/Total revenues (%)		45.9		61.9		49.7		54.9
Capex		482		189		1,318		429
ARPU (GSM) – monthly (NOK)		88		130		106		136
No. of subscriptions (100% in thousand)						2,388		1,141

Telenor’s ownership interest at the end of 2004 was 62.0%. The Norwegian Krone appreciated against the Bangladeshi Takka by approximately 10% in the fourth quarter of 2004 compared to the fourth quarter of 2003.

•	GrameenPhone experienced high growth and more than doubled the customer base during 2004. The number of subscriptions increased by 364,000 during the fourth quarter and by more than 1.2 million compared to the end of 2003.

•	GrameenPhone’s estimated market share at the end of 2004 was 62%, compared to 63% at the end of third quarter 2004. The estimated mobile penetration in Bangladesh increased by 0.4 percentage points from the previous quarter to 2.8% at the end of 2004.

•	The increase in the number of subscriptions contributed to an increase in revenues of 48% measured in local currency compared to the fourth quarter of 2003.

•	Measured in local currency, ARPU declined by 25% compared to the fourth quarter of 2003. This was primarily due to a higher portion of prepaid subscriptions as well as price reductions. Adjusted for accruals between the quarters ARPU declined by 20%.

•	The EBITDA margin declined compared to the fourth quarter of 2003, but was in line with previous quarters in 2004. Measured in local currency, EBITDA increased by 23% compared to the fourth quarter of 2003, primarily due to the increase in revenues.

•	Compared to the fourth quarter of 2003, depreciation and amortization increased as a result of increased capital expenditure in the intervening quarters.

•	Increased capital expenditure was primarily related to the network investment required by strong subscriber growth as well as improved coverage.

•

On 26 October 2004,Telenor acquired 4.5% of the shares in GrameenPhone for a consideration of USD 9.7 million. On 27 December 2004, we further acquired 6.5% of the shares for a consideration of USD 37.2 million. Telenor’s ownership interest at the end of 2004 was 62.0%. In total, Telenor has invested NOK 565 million in the company.

PROMONTE GSM – MONTENEGRO


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
Mobile related revenues		109		—		189		—
Other revenues		9		—		11		—
Total revenues		118		—		200		—


EBITDA		46		—		91		—
Depreciation and amortization		23		—		35		—
Operating profit		23		—		56		—


EBITDA/Total revenues (%)		39.0		—		45.5		—
Operating profit/Total revenues (%)		19.5		—		28.0		—
Capex		13		—		16		—
ARPU (GSM) – monthly (NOK)		115		—		142		—
No. of subscriptions (in thousand)						279		—

Telenor’s ownership interest in ProMonte was 100% at the end of 2004. The preceding table shows figures included in the accounts for Telenor from 12 August 2004, the date of consolidation of ProMonte. ARPU for the year 2004 is for the period 1 January–31 December 2004.

•	At the end of the fourth quarter of 2004, ProMonte’s estimated market share was 58%, an increase of one percentage point compared to the previous quarter.

•	The number of subscriptions increased by 38,000 compared to the end of 2003. The number of subscriptions decreased by 61,000 from the end of the third quarter of 2004, as a result of prepaid subscriptions being churned when the tourist season has ended.

•	Measured in local currency, ARPU declined by 12% compared to the fourth quarter of 2003 primarily due to price reductions.

•	Revenues and EBITDA margin for the full year 2004 were NOK 492 million and 50%, respectively.

OTHER UNITS IN MOBILE

(including eliminations and amortization and write-downs of net excess values)


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
EBITDA		(129	)		(89	)		(429	)		(374	)
Depreciation and amortization ¹⁾		536			205			1,849			967
Write-downs		2,191			(1	)		2,191			7
Operating (loss)		(2,856	)		(293	)		(4,469	)		(1,348	)

¹⁾ Includes amortization of Telenor’s net excess values by *⁾		513			198			1,848			911
Capex		179			3			2,021			(7	)

*⁾	Net excess values are the difference between Telenor’s acquisition cost and Telenor’s share of equity at acquisition of subsidiaries.

•	Other units in Mobile include the greenfield operation in Pakistan, costs related to the management and administration of Telenor’s international mobile operations, as well as amortization and write-downs of Telenor’s net excess values on consolidated mobile companies.

•	Increased EBITDA loss compared to the fourth quarter of 2003 was due to operating costs related to the start-up of operations in Pakistan. The EBITDA loss in Pakistan in the fourth quarter and for the year 2004 was NOK 40 million and NOK 78 million, respectively.

•	Increased amortization of net excess values compared to the fourth quarter of 2003 was due to amortization of excess values related to Sonofon.

•

In connection with Telenor’s annual impairment test of entities containing goodwill, the market value of the mobile company Sonofon in Denmark has been assessed to be lower than the book value. This has led to a write-down of NOK 2.4 billion, of which NOK 2.2 billion is goodwill. The enterprise value of Sonofon is NOK 7.7 billion subsequent to the write-down.

•	Capital expenditure for the fourth quarter of 2004 was primarily related to the greenfield operation in Pakistan.

ASSOCIATED COMPANIES AND JOINT VENTURES IN MOBILE


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
Telenors share of ¹⁾
Net income after taxes		63			75			857			608
Amortization of Telenor’s net excess values ²⁾		(25	)		(77	)		(163	)		(534	)
Write-downs of Telenor’s excess values		—			(15	)		—			(15	)
Gains on disposal of ownership interests		—			—			—			1,580
Net result from associated companies		38			(17	)		694			1,639



¹⁾		The figures are partially based on management’s estimates in connection with the preparation of the consolidated financial statements. The consolidated profit and loss statement contains only the line “Net result from associated companies”. The table includes Telenor’s share of the results in Sonofon until 12 February 2004 and ProMonte GSM until 12 August 2004. Effective from these dates, Sonofon and ProMonte GSM were consolidated as subsidiaries. Cosmote was included as an associated company through April 2003.

²⁾		Net excess values are the differences between Telenor’s acquisition cost and Telenor’s share of equity at acquisition of associated companies.

•

Telenor’s ownership interest in VimpelCom in Russia was 29.9% at the end of 2004. The value of Telenor’s share of the company based on the quoted share price as at 31 December 2004 was NOK 13.4 billion. The merger between VimpelCom and VimpelCom – Region was completed and effective from 26 November 2004. The number of subscriptions at the end of 2004 was approximately 27 million according to telecom analysts.

•

Telenor’s direct and indirect ownership interest in DTAC in Thailand was 40.3% at the end of 2004. The value of Telenor’s share of the company based on quoted share price as at 31 December 2004 was NOK 4.2 billion. The number of subscriptions in DTAC at the end of 2004 was approximately 7.8 million.

•	Reduced amortization of Telenor’s net excess values on associated companies compared to the fourth quarter of 2003 was primarily due to the consolidation of Sonofon as of 12 February 2004 and adjustments made in the fourth quarter of 2003.

FIXED


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
External revenues
Norway		3,820			4,060			15,669			16,409
Sweden		410			431			1,588			1,517
Russia		—			145			—			701
Other countries		44			42			173			160
Total external revenues		4,274			4,678			17,430			18,787

Internal revenues		510			489			1,826			1,713
Gains on disposal		9			8			10			9
Total revenues		4,793			5,175			19,266			20,509


EBITDA		1,552			1,622			6,277			6,665
Depreciation and amortization ¹⁾		838			1,037			3,468			4,110
Write-downs		15			17			15			24
Operating profit		699			568			2,794			2,531

¹⁾ Includes amortization of Telenor’s net excess values by		(25	)		(24	)		(102	)		(76	)

EBITDA/Total revenues (%)		32.4			31.3			32.6			32.5
Operating profit/Total revenues (%)		14.6			11.0			14.5			12.3

Investments:
– Capex		609			584			1,791			1,867
– Investments in businesses		8			76			105			294

•

Compared to the fourth quarter of 2003, the results were affected by the sale of Comincom/Combellga to Golden Telecom on 1 December 2003. In addition, the results were affected by the fact that Telenor, as part of the efficiency improvements of operations, sold parts of the Operating services business from Fixed to EDB Business Partner with effect from 1 May 2004. The sold business provides services in connection with the operation of the IT systems to other Telenor companies and to external customers. The business was included in the results for Fixed until 1 May 2004.

•

Adjusted for the sale of Comincom/Combellga, the sale of parts of the Operating services to EDB Business Partner and special items, revenues decreased by 2.1% and the EBITDA margin was in line with the fourth quarter of 2003. Correspondingly, adjusted operating profit margin increased by 0.5 percentage points.

FIXED – NORWAY


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
Retail revenues
Subscriptions and connections – PSTN/ISDN		864		1,031		3,683		4,300
Subscriptions and connections – ADSL/Internet		364		275		1,315		1,041
Internet traffic		95		129		410		561
Other traffic		1,124		1,225		4,495		5,062
Total PSTN/ISDN, ADSL and Internet		2,447		2,660		9,903		10,964

Leased lines		71		80		301		329
Data communication		213		218		854		836
Managed services		94		191		454		726
Other retail products		101		74		509		377
Total other retail revenues		479		563		2,118		2,268

Total retail revenues		2,926		3,223		12,021		13,232


Wholesale revenues
Sales to service providers and operators		172		97		711		249
Domestic interconnect		151		160		608		643
International interconnect		91		84		329		339
Transit traffic		228		260		993		1,038
Leased lines		143		157		614		631
Other wholesale revenues		109		79		393		277
Total wholesale revenues		894		837		3,648		3,177

Total external revenues		3,820		4,060		15,669		16,409

Internal revenues		521		497		1,844		1,776
Gains on disposal		5		3		5		4
Total revenues – Norway		4,346		4,560		17,518		18,189


EBITDA		1,563		1,608		6,271		6,512
Depreciation and amortization ¹⁾		772		962		3,244		3,773
Write-downs		2		19		2		19
Operating profit		789		627		3,025		2,720

¹⁾ Includes amortization of Telenor’s net excess values by		1		2		2		9


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
EBITDA/Total revenues (%)		36.0		35.3		35.8		35.8
Operating profit/Total revenues (%)		18.2		13.8		17.3		15.0

Investments:
– Capex		457		482		1,473		1,568
– Investments in businesses		1		1		2		1

•	The number of ADSL subscriptions (residential and business) increased by a total of 56,000 during the fourth quarter of 2004 to 326,000, an increase of 149,000 from the end of 2003. Telenor’s estimated market share for ADSL subscriptions was 58% at the end of 2004.

•	Telenor’s market share measured in traffic minutes was 69% at the end of 2004, in line with the end of 2003 and the third quarter of 2004.

•

Adjusted for the sale of the Operating services business to EDB Business Partner, revenues decreased by 2.0% compared to the fourth quarter of 2003 due to the decrease in retail revenues not being fully offset by the increase in wholesale revenues. This was due to a decrease in revenues from international interconnect, transit traffic and leased lines on a wholesale basis. Adjusted for the sale of the Operating services business to EDB Business Partner and special items, the EBITDA margin was in line with the fourth quarter of 2003 and the operating profit margin increased by 3.2 percentage points.

•	External revenues from ”Subscriptions and connections – PSTN/ISDN” decreased compared to the fourth quarter of 2003 due to the transition to sales of access lines on a wholesale basis and a decrease in the number of subscriptions in the market as a whole.

•	Increased external revenues from ”Subscriptions and connections – ADSL/Internet” were due to the increase in the number of ADSL subscriptions.

•

Reduced external traffic revenues in the retail market compared to the fourth quarter of 2003 was primarily due to a 19% decline in total traffic measured in minutes in Telenors’s network. The reduction in total traffic was due to the migration of voice traffic from fixed telephony to mobile telephony and data traffic from dial-up Internet to ADSL.

•	External revenues from “Managed services” decreased compared to the fourth quarter of 2003 due to the sale of parts of this operation to EDB Business Partner.

•	Increased revenues from ”Other retail products” compared to the fourth quarter of 2003 were primarily due to revenues from new contracts.

•

Increased revenues from “Sales to service providers and operators” were due to increased sales of access lines on a wholesale basis (PSTN, ISDN and ADSL). The number of PSTN/ISDN lines sold on a wholesale basis was 438,000 at the end of 2004, an increase of 208,000 compared to the end of 2003. The number of ADSL subscriptions sold on a wholesale basis was 91,000 at the end of 2004, an increase of 35,000 compared to the end of 2003.

•	Reduced external revenues from “International interconnect” and “Transit traffic” were due to a decline in international and transit traffic measured in minutes as a result of more operators outside Norway sending the traffic within their own network.

•	Reduced external revenues from ”Leased lines” on a wholesale basis were primarily due to the migration of several data services to DSL technology.

•	Increased external “Other wholesale revenues” was primarily due to increased sales of local loop unbundled subscriptions. The number of local loop unbundled subscriptions sold at the end of 2004 was 145,000, an increase of 65,000 compared to the end of 2003.

•	Increased internal revenues were mainly due to growth in the sale of contractor services.

•

EBITDA decreased compared to the fourth quarter of 2003. Reduced revenues and the effects from the sale of parts of the Operating services business to EDB Business Partner were partially offset by reduced operating costs. The decrease in operating costs, was primarily due to pension obligations being recognised as income as a result of a change in the accounting treatment of pensions in Telenor group and certain changes in estimates including provisions for losses on receivables. This affected the EBITDA margin positively in the fourth quarter of 2004 by approximately 3 percentage points.

•	Depreciation and amortization decreased compared to the fourth quarter of 2003 primarily due to a lower investment activity in recent years and as a consequence of the sale of parts of the business in Operating services to EDB Business Partner.

FIXED – SWEDEN


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
External revenues		410			431			1,588			1,517
Internal revenues		24			19			99			81
Gains on disposal		4			5			5			5
Total revenues		438			455			1,692			1,603


EBITDA		(3	)		(8	)		8			(56	)
Depreciation and amortization ¹⁾		44			36			164			141
Write-downs		11			(3	)		11			1
Operating (loss)		(58	)		(41	)		(167	)		(198	)

¹⁾ Includes amortization of Telenor’s net excess values by		(26	)		(35	)		(104	)		(143	)

Investments:
– Capex		134			59			279			85
– Investments in businesses		6			13			93			13

•

Reduced revenues compared to the third quarter of 2003 were primarily due to the termination of volume contracts related to international interconnect and reduced sales of telephony services on a wholesale basis. In the fourth quarter of 2004, NOK 56 million in prepaid capacity for future deliveries was recognised as income because the delivery obligation was terminated.

•	Compared to the fourth quarter of 2003, EBITDA was positively affected by the recognition of revenue mentioned above, offset by reduced revenue from sale on a wholesale basis and increased operating costs due to rollout of ADSL.

•	Increased capital expenditure compared to the fourth quarter of 2004 was primarily due to rollout of DSL for wholesale purposes.

FIXED – RUSSIA


	4th quarter					Year
(NOK in millions)	2004		2003			2004		2003
Total revenues		—		145			—		703
EBITDA		—		8			—		215
Operating profit (loss) ¹⁾		—		(18	)		—		71

¹⁾ Includes amortization of Telenor’s net excess values by		—		9			—		58

Investments:
– Capex		—		32			—		173

•	Telenor’s shareholding in Comincom/Combellga was sold on 1 December 2003 in exchange for shares in the listed company Golden Telecom. Comincom/Combellga was consolidated as a subsidiary until 1 December 2003. Golden Telecom is accounted for as an associated company from this date.

FIXED – OTHER COUNTRIES

•	Fixed – Other Countries consist of activities in the Czech Republic and Slovakia. The EBITDA loss in this quarter was NOK 4 million, compared to an EBITDA loss of NOK 2 million in the fourth quarter of 2003.

BROADCAST


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
External revenues
Distribution		1,110		1,033		4,300		3,761
Transmission		188		207		788		816
Other		43		33		123		64
Total external revenues		1,341		1,273		5,211		4,641

Internal revenues		33		37		135		159
Gains on disposal		1		—		1		20
Total revenues		1,375		1,310		5,347		4,820


EBITDA		333		379		1,495		1,229
Depreciation and amortization ¹⁾		212		238		886		1,030
Write-downs		20		9		20		18
Operating profit		101		132		589		181

¹⁾ Includes amortization of Telenor’s net excess values by		56		62		243		256

EBITDA/Total revenues (%)		24.2		28.9		28.0		25.5
Operating profit/Total revenues (%)		7.3		10.1		11.0		3.8

Investments:
– Capex		71		133		880		252
– Investments in businesses		—		—		—		14

•	Revenues increased in the fourth quarter of 2004 compared to the fourth quarter of 2003, primarily due to growth in the number of subscribers and price increases.

•

Reduced EBITDA margin in the fourth quarter of 2004 compared to the fourth quarter of 2003 was primarily due to increased costs for marketing and commissions in Distribution as the competition in the Nordic area intensified. In addition, EBITDA in the fourth quarter of 2003 was positively influenced by accruals between the quarters. This was partially offset by reduced costs associated with replacing leased satellite capacity with own capacity.

•	Reduced capital expenditure compared to the fourth quarter of 2003 was primarily due to reduced capital expenditure in the analogue broadcasting network and the cable TV networks in Norway.

BROADCAST – DISTRIBUTION


	4th quarter					Year
(NOK in millions)	2004			2003		2004		2003
External revenues
Satellite dish		750			702		2,917		2,528
Cable-TV		257			233		986		888
Small antenna TV-networks		97			94		382		335
Other		6			4		15		10
Total external revenues		1,110			1,033		4,300		3,761

Internal revenues		1			4		9		13
Gains on disposal		1			—		1		20
Total revenues		1,112			1,037		4,310		3,794


EBITDA		127			228		749		686
Depreciation and amortization ¹⁾		135			176		592		754
Write-downs		15			6		15		8
Operating profit (loss)		(23	)		46		142		(76	)

¹⁾ Includes amortization of Telenor’s net excess values by		56			61		243		255

EBITDA/Total revenues (%)		11.4			22.0		17.4		18.1
Operating profit/Total revenues (%)		nm			4.4		3.3		nm

Investments:
– Capex		26			58		120		112

•	The number of subscribers with satellite dish was 824,000 at the end of 2004 compared to 763,000 at the end of 2003. The number of subscribers with cable TV was 624,000 at the end of 2004 compared to 604,000 at the end of 2003.

•	Revenues in Distribution increased compared to the fourth quarter of 2003 primarily due to an increase in the number of subscribers and price increases for “Satellite dish”.

•

The EBITDA margin in the fourth quarter of 2003 adjusted for gains on disposal and accruals between the quarters in 2003 was approximately 16%. Reduced EBITDA margin beyond this was primarily due to increased costs for marketing and commissions related to new customers with satellite dish and cable-TV, including costs for decoders.

•	Reduced depreciation and amortization was a result of fully depreciated fixed assets within “Satellite dish”.

•	Reduced capital expenditure was primarily due to decreased investments in the cable TV networks in Norway compared to the fourth quarter of 2003.

BROADCAST – TRANSMISSION


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
External revenues		188		207		788		816
Internal revenues		107		110		423		461
Total revenues		295		317		1,211		1,277


EBITDA		190		144		685		554
Depreciation and amortization		71		60		276		266
Write-downs		1		2		1		7
Operating profit		118		82		408		281


EBITDA/Total revenues (%)		64.4		45.4		56.6		43.4
Operating profit/Total revenues (%)		40.0		25.9		33.7		22.0

Investments:
– Capex		34		65		735		116

•	External revenues decreased in Transmission compared to the fourth quarter of 2003 as a result of decreased revenues within satellite operations as a result of transition from analogue to digital distribution, which is a more efficient distribution method and demands less capacity.

•	Investment in a new satellite in August 2004 contributed to reduced costs for leased satellite capacity, and was the main reason for the increase in EBITDA margin compared to the fourth quarter of 2004.

•	Increased depreciation and amortization was primarily due to the acquisition of an ownership interest in a new satellite in the third quarter of 2004 and increased capital expenditure in the analogue broadcasting network in the fourth quarter of 2003.

BROADCAST – OTHER

•	Increased revenues in Broadcast – Other compared to the fourth quarter of 2003 was due to increased sales of smart cards and services related to access control for Pay TV in international markets.

OTHER ACTIVITIES

EDB BUSINESS PARTNER


	4th quarter					Year
(NOK in millions)	2004			2003		2004		2003
External revenues		902			830		3,311		3,210
Internal revenues		236			283		924		1,060
Gains on disposal		(6	)		—		295		19
Total revenues		1,132			1,113		4,530		4,289


EBITDA		173			177		924		399
Depreciation and amortization		107			98		400		375
Write-downs		—			11		—		28
Operating profit (loss)		66			68		524		(4	)


EBITDA/Total revenues (%)		15.3			15.9		20.4		9.3
Operating profit/Total revenues (%)		5.8			6.1		11.6		nm

Investments:
– Capex		116			65		233		210
– Investments in businesses		674			—		1,076		95

Telenor’s ownership interest in EDB Business Partner was 51.8% at the end of 2004.

•

In fourth quarter of 2004, EDB Business Partner entered into an agreement to take over IBM’s activities in the area of IT operations and application services for Norwegian customers in the local public sector, distribution sector and industry sector for a price of NOK 473 million. Further, EDB Business Partner entered into an agreement to purchase Capgemini’s activities in the IT operations area in Sweden and Norway for a price of NOK 185 million. The activities were purchased 31 December 2004 and are expected to generate revenues of approximately NOK 880 million in 2005.

•

Adjusted for the disposal of operations and gains, revenues increased by 13% compared to the fourth quarter of 2003, of which IT Operations increased by 17%, Banking & Finance increased by 4% and Telecom declined by 11%. The increase in IT Operations was due primarily to the acquisition of parts of the Operation services business by Telenor in the second quarter of 2004.

•	EBITDA was in line with the fourth quarter of 2003. Within IT Operations and Banking & Finance EBITDA increased, while EBITDA in Telekom was lower than in the fourth quarter of 2003.

•	Capital expenditure increased compared to the fourth quarter of 2003 due primarily to investments du to new customer contracts, investments in premises and investments related to acquired activities.

OTHER BUSINESS UNITS

Revenues


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
Satellite Services		573			603			2,385			2,540
Nextra International		—			—			—			256
Software Services		—			73			60			121
Other		241			338			1,018			1,240
Eliminations		(1	)		(1	)		(3	)		(3	)
Revenues		813			1,013			3,460			4,154

Gains on disposal		65			35			135			51
Total revenues		878			1,048			3,595			4,205


EBITDA		166			232			524			408
Depreciation and amortization ¹⁾		85			147			372			491
Write-downs ¹⁾		—			23			39			37
Operating profit (loss)		81			62			113			(120	)

¹⁾ Include amortization and write-downs of Telenor’s net excess values by		10			11			37			40

Operating profit (loss)


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
Satellite Services		18			58			108			234
Nextra International		13			34			13			(220	)
Software Services		(2	)		(3	)		(87	)		(86	)
Other		52			(27	)		79			(48	)
Total operating profit (loss)		81			62			113			(120	)


Investments:
– Capex		91			94			215			233
– Investments in businesses		75			13			200			30

Satellite Services

•	The decrease in revenues in Satellite Services compared to the fourth quarter of 2003 was primarily due to the effect of the strengthening of the Norwegian Krone against the US Dollar, partially offset by the net effect of the acquisition and disposal of operations.

•	The operating profit decreased compared to the fourth quarter of 2003 primarily due to the same reasons as mentioned above, but in addition, due to reduced margins.

Software Services

•	The agreement with Computer Associate was sold to EDB Business Partner and the operations were discontinued in Software Services in the third quarter of 2004.

Other

•

Other business includes primarily operations within Venture and International Business. Teleservice was acquired by Venture in the fourth quarter and is now included in “Other”. The decrease in revenues and the positive operating profit compared to the fourth quarter of 2003 were primarily due to the sale of subsidiaries.

Gains on disposal

•	Gains on disposal in the third quarter of 2004 were primarily connected to disposal of companies in Telenor Venture.

Investments in businesses

•	Investments in businesses in the fourth quarter of 2004 were primarily related to Satellite Services’ purchase of Neratek AS.

CORPORATE FUCTIONS AND GROUP ACTIVITIES


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
External revenues		68			71			256			229
Internal revenues		459			478			1,833			1,955
Gains on disposal		34			87			104			133
Total revenues		561			636			2,193			2,317


EBITDA		(82	)		(32	)		(81	)		23
Depreciation and amortization		97			101			384			384
Write-downs		—			3			3			3
Operating (loss)		(179	)		(136	)		(468	)		(364	)


Investments:
– Capex		49			162			234			253
– Investments in businesses		36			83			54			93

•	Increased EBITDA loss compared to the fourth quarter of 2003 was primarily related to reduced gains on disposal and increased pension costs, which partially were offset by decreased operating expenses. Gains on disposal in the fourth quarter of 2004 were primarily related to sale of subsidiaries. A change in the accounting treatment of pensions in the group resulted in an increase in pension costs of NOK 94 million in the fourth quarter, offset by reduced pension costs in the business areas. The total effect for the group was slightly negative. The decrease in operating expenses was related to high costs associated with group projects and M&A activities in the fourth quarter of 2003.

•	Reduced capital expenditure compared to the fourth quarter of 2003 was due to lower investments in properties.

OTHER PROFIT AND LOSS ITEMS FOR THE GROUP

Depreciation, amortization and write-downs


	4th quarter				Year
(NOK in millions)	2004		2003		2004		2003
Depreciation of tangible assets		1,709		1,956		7,667		7,986
Amortization of goodwill *⁾		233		162		939		686
Amortization of other intangible assets *⁾		1,046		523		3,017		1,925
Total depreciation and amortization		2,988		2,641		11,623		10,597
Write-downs of tangible and other intangible assets		260		58		268		104

Write-downs of goodwill		2,191		—		2,194		16
Write-downs of other intangible assets		99		11		134		25
Total write-downs		2,550		69		2,596		145

Total depreciation, amortization and write-downs		5,538		2,710		14,219		10,742

*⁾	See specification below.

•	The decrease in depreciation of tangible assets and the increase in amortization of other intangible assets in the fourth quarter compared to the previous quarters of 2004 were primarily due to reclassifications between tangible and intangible assets, primarily related to Sonofon and DiGi.Com.

•	In the fourth quarter of 2004 Telenor has written down goodwill related to Sonofon with NOK 2,190 million.

*⁾	Specification of amortization of goodwill and other intangible assets (including amortization of Telenor’s net excess values)


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
Amortization of goodwill
Sonofon		69			—			266			—
DiGi.Com		11			12			46			48
Pannon GSM		81			77			325			308
Kyivstar		8			9			37			39
ProMonte		1			—			2			—
Other Mobile		2			—			2			5
Total Mobile		172			98			678			400

Fixed		(28	)		(27	)		(105	)		(95	)
Broadcast		45			40			192			197
EDB Business Partner		41			41			158			151
Other units		3			10			16			33
Total amortization of goodwill		233			162			939			686


Amortization of other intangible assets
Sonofon		432			—			975			—
DiGi.Com		62			20			123			83
Pannon GSM		145			123			605			564
Kyivstar		66			57			255			213
ProMonte		27			—			39			—
Other Mobile		96			81			336			374
Total Mobile		828			281			2,333			1,234

Fixed		108			110			399			431
Broadcast		27			31			92			78
EDB Business Partner		1			(4	)		1			1
Other units		82			105			192			181
Total amortization of other intangible assets		1,046			523			3,017			1,925

•	Amortization of goodwill in Fixed in 2003 and 2004 was recorded as income due to amortization of the negative goodwill related to Utfors AB.

Associated companies


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
Telenors share of ¹⁾
Net income after taxes		110			(65	)		912			329
Amortization of Telenor’s net excess values		(43	)		(98	)		(226	)		(579	)
Write-downs of Telenor’s excess values		—			(15	)		—			(26	)
Gains on disposal of ownership interests		15			(1	)		32			1,507
Net result from associated companies		82			(179	)		718			1,231

¹⁾	The figures are partially based on management’s estimates in connection with the preparation of the consolidated financial statements. The consolidated profit and loss statement contains only the line “Net result from associated companies”.

•	Increased net income after taxes from associated companies compared to the fourth quarter of 2003 was primarily due to Bravida. In the fourth quarter of 2004 Bravida sold parts of its business with a gain before taxes. Net income for Bravida was materially affected by expenses for restructuring measures in the fourth quarter of 2003 and 2004.

•	The decrease in amortization of Telenor’s net excess values compared to the fourth quarter of 2003 was primarily due to the reduced amortization of net excess value on companies, which are no longer associated companies, primarily Sonofon, partially offset by adjustments made in the fourth quarter of 2003.

Financial items


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
Financial income		153			173			496			586
Financial expenses		(330	)		(428	)		(1,534	)		(2,023	)
Net foreign currency gain (loss)		(60	)		(56	)		(87	)		(1	)
Net gains (losses) and write-downs		20			201			2,651			73
Net financial items		(217	)		(110	)		1,526			(1,365	)


Gross interest expenses		(353	)		(440	)		(1,576	)		(2,033	)
Net interest expenses		(270	)		(291	)		(1,182	)		(1,549	)

•	The decrease in financial income compared to the fourth quarter of 2003 was primarily due to reduced interest revenues as a consequence of a decline in interest rates in the market and a lower level of liquid assets, partially offset by dividends received in the fourth quarter of 2004.

•	The decrease in average interest-bearing liabilities and average interest rates contributed to the decrease in financial expenses compared to the fourth quarter of 2003.

Taxes

•	The nominal Norwegian corporate income tax (“CIT”) rate is 28%. The effective tax rate for the Telenor Group, for fiscal year 2004, is estimated to 28% of profit before income tax and minority interests. Increased estimated effective tax due to amortization and write-downs of goodwill on which deferred tax assets have not been recognized was offset by tax losses on sale and liquidation of shares and a reduction in deferred tax on undistributed earnings, as discussed below. The actual effective tax rate for 2004 may deviate from the estimated rate.

•	In December 2004, new tax rules were enacted by the Norwegian Parliament. The major changes for corporations were the introduction of the “Exemption Method”. According to this new legislation, capital gains deriving from the sale of shares and dividends received from subsidiaries will be tax exempt. However, any loss deriving from the sale or other disposal of shares will no longer be tax deductible. The new rules in respect of dividends received became effective as of 1 January 2004, while the capital gains rules/non deducibility of capital losses came into effect as of 26 March 2004. Certain transitional rules were enacted. One of these transitional rules allows net losses from (external) disposal of shares, recognised in the period between 26 March and 31 December 2004 to be offset against otherwise taxable gains recognised on disposal of shares in the period between 1 January and 26 March 2004. When new rules are introduced there may be disagreements on the interpretation of the new rules and the transitional rules.

•	As a consequence of the “Exemption Method”, previously recognized deferred tax assets of NOK 0.5 billion were expensed by our subsidiary EDB Business Partner ASA. These deferred tax assets related to the liquidation of subsidiaries, which had not been decided by the appropriate corporate body prior to 26 March 2004.

•	However, Telenor has benefited from net capital (tax) losses derived from disposals and liquidations of subsidiaries during the period between 26 March and 31 December 2004. According to the transitional rules, the net tax losses recognised have been offset against the otherwise taxable gain deriving from our sale of shares in Cosmote during the first quarter of 2004.

•	As a consequence of the “Exemption Method”, Telenor will no longer recognize deferred (Norwegian) income tax on undistributed earnings in its foreign subsidiaries and associated companies except where we still are subject to foreign withholding tax at source that will be levied upon distribution of dividends. This change in tax legislation had a positive effect of approximately NOK 0.6 billion on previously recognized deferred income tax on undistributed earnings in subsidiaries, of which NOK 0.5 billion is related to Pannon GSM.

Balance sheet and cash flow

•	The book value of other intangible assets, tangible assets and associated companies decreased compared to the end of the third quarter of 2004, primarily due to the strengthening of the Norwegian Krone compared to other currencies. The decrease in goodwill was primarily related to the write-down of Sonofon.

•	Net interest bearing liabilities decreased by NOK 1.4 billion compared to the end of the third quarter of 2004 to NOK 19.2 billion at the end of 2004. During the fourth quarter of 2004 we received payments for the sale of some investments. Payments for capital expenditures were lower than reported capital expenditures, partially because only a part of the UMTS license in Pannon GSM was paid in this quarter. Currency fluctuations decreased net interest-bearing liabilities measured in Norwegian Krone by approximately NOK 0.2 billion.

•	During the fourth quarter of 2004, Telenor did not purchase own shares in the market. If the general meeting of Telenor’s shareholders in 2005 approves to redeem shares owned by the Kingdom of Norway corresponding to Telenor’s repurchase of own shares in the market in the second and the third quarter of 2004, in such a way that the Kingdom of Norway’s ownership interest remains unchanged, shareholders equity will be reduced by an additional NOK 0.8 billion at the time of the general meeting.

•	As of 31 December 2004, equity was reduced by NOK 2.6 billion for dividends that will be proposed for 2004.

•	Minority interests in the balance sheet decreased compared to the end of the third quarter of 2004, primarily due to Telenor’s increased ownership in GrameenPhone and the net loss in EDB Business Parter due to expensing of previously recognized deferred tax assets. Currency fluctuations also contributed to the decrease.

DISPUTES

•	In November 2003, Sense Communication International AS (Sense) initiated legal proceedings against Telenor, based on allegations that Telenor prices in the service provider agreement for the period 2000 until 2003 had been excessive and not in accordance with the requirements for cost oriented pricing. The claim was limited upward to NOK 255 million plus interest and legal expenses. In a judgement from the Asker and Bærum District Court in November 2004 Telenor was acquitted. Sense has appealed the decision and has extended the claim to include 2004 and claim NOK 300 million plus interest and legal expenses.

•	Please refer to note 24 to Telenor’s annual report for 2003 and previous quarterly reports in 2004 for more information about legal proceedings.

US GAAP

•	Net income and equity according to United States Generally Accepted Accounting Principles (US GAAP) will be published in the annual report for 2004.

OUTLOOK FOR 2005

•	The strong growth in revenues and subscriptions during 2004 gives Telenor a good basis for further improvement of profits.

•	A continued high growth in revenue and EBITDA is expected, in particular driven by the international mobile operations. Telenor will continue previously implemented cost efficiency activities and identify new initiatives. This will compensate for intensified competition and costs related to new operations. High capital expenditure is expected for 2005, in which capital expenditure in proportion of revenues is expected to be in line with or slightly exceed 2004. Capital expenditure is driven by considerable network investments in Kyivstar, Telenor Pakistan, GrameenPhone and DiGi.Com. In addition, we expect further UMTS investments.

•	For Telenor’s mobile operations, a high growth in revenues and EBITDA is expected to continue in 2005. We will implement cost reductions and improvements, in particular within our Nordic operations.

•	In Fixed – Norway, revenue and EBITDA is anticipated to slightly decrease. The strong growth in the number of ADSL subscriptions is expected to continue. This fact, in addition to increased revenues from wholesale, does not fully offset decreased revenues from PSTN/ISDN.

•	In Broadcast and other units, we expect EBITDA to improve in 2005 compared to 2004.

•	A continuously increasing share of Telenor’s revenues and profits come from operations outside Norway. Currency fluctuations will to an increasing extent influence the reported figures in Norwegian Krone. Political risk, including regulatory conditions, might also influence the profits.

•	Telenor anticipates that profits exclusive special items, overall will grow in 2005 compared to 2004.

The unaudited interim consolidated financial statements according to Norwegian accounting principles have been prepared on a basis consistent with Telenor’s financial statements as of year-end 2003, and in accordance with the Norwegian accounting standard for interim reporting.

The accounts submitted with the report have not been audited. This report contains statements regarding the future in connection with Telenor’s growth initiatives, profit figures, outlook, strategies and objectives. In particular, the section “Outlook for 2005” contains forward-looking statements regarding the group’s expectations. All statements regarding the future are subject to inherent risks and uncertainties, and many factors can lead to actual profits and developments deviating substantially from what has been expressed or implied in such statements. These factors include the risk factors relating to Telenor’s activities described in Telenor’s Annual Report 2003 on Form 20-F filed with the Securities and Exchange Commission in the USA under the headings “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors” (available at www.telenor.com/ir/).

Oslo, 15 February 2005
The Board of Directors of Telenor ASA

Profit and loss statement


Telenor group	4th quarter						Year
(NOK in millions except net income per share)	2004			2003			2004			2003
Revenues		15,608			13,671			60,752			52,889
Gains on disposal of fixed assets and operations		105			130			550			232
Total revenues		15,713			13,801			61,302			53,121

Costs of materials and traffic charges		4,306			3,258			16,086			13,094
Own work capitalized		(166	)		(173	)		(557	)		(571	)
Salaries and personnel costs		2,750			2,550			10,021			9,561
Other operating expenses		4,311			3,255			14,857			12,506
Losses on disposal of fixed assets and operations		(7	)		28			74			229
Depreciation and amortization		2,988			2,641			11,623			10,597
Write-downs		2,550			69			2,596			145
Total operating expenses		16,732			11,628			54,700			45,561

Operating profit		(1,019	)		2,173			6,602			7,560

Associated companies		82			(179	)		718			1,231
Net financial items		(217	)		(110	)		1,526			(1,365	)
Profit before taxes and minority interests		(1,154	)		1,884			8,846			7,426

Taxes		916			(604	)		(2,484	)		(2,376	)
Minority interests		(144	)		(281	)		(1,134	)		(490	)
Net income		(382	)		999			5,228			4,560


Net income per share in NOK — basic and diluted		(0.22	)		0.56			2.99			2.57

BALANCE SHEET


Telenor group (NOK in millions)	31.12.2004			30.09.2004			31.12.2003
Deferred tax assets		3,068			1,245			3,850
Goodwill		12,114			14,546			9,224
Intangible assets		11,432			10,897			5,536
Tangible assets		37,495			38,083			35,722
Associated companies		6,436			6,672			10,166
Other financial assets		1,247			2,414			3,848

Total fixed assets		71,792			73,857			68,346


Other current assets		11,205			11,222			9,819
Liquid assets		5,398			4,404			7,945

Total current assets		16,603			15,626			17,764

Total assets		88,395			89,483			86,110


Paid-in equity		27,350			27,318			29,311
Other equity		12,674			15,600			9,978
Cumulative translation adjustments		(2,561	)		(1,670	)		(2,052	)

Shareholders equity		37,463			41,248			37,237

Minority interests		3,986			4,342			3,646

Total equity and minority interests		41,449			45,590			40,883


Provisions		3,837			2,860			1,645

Long-term interest-bearing liabilities		20,739			22,852			22,703
Long-term non-interest-bearing liabilities		589			723			754

Total long-term liabilities		21,328			23,575			23,457


Short-term interest-bearing liabilities		3,854			2,148			3,059
Short-term non-interest-bearing liabilities		17,927			15,310			17,066

Total short-term liabilities		21,781			17,458			20,125

Total equity and liabilities		88,395			89,483			86,110

Next years installment is reclassified from long-term to short-term interest-bearing liabilities in previous periods.

CHANGE IN SHAREHOLDERS EQUITY


	01.01.2004			01.01.2004			01.01.2003
(NOK in millions)	- 31.12.2004			- 30.09.2004			- 31.12.2003
Shareholders equity as of 1 January		37,237			37,237			33,685
Net income		5,228			5,610			4,560
Dividends		(2,590	)		12			(1,776	)
Employee share issue		59			27			26
Acquisition Comincom/Combellga		—			—			(35	)
Acquisition GrameenPhone		(168	)		—			(39	)
Acquisition ProMonte		164			—			—
Share buy back		(2,020	)		(2,020	)		—
Equity adjustments in associated companies		62			—			—
Translation adjustments		(509	)		382			816

Shareholders equity		37,463			41,248			37,237

CASH FLOW STATEMENT


Telenor group	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
Profit before taxes and minority interests		(1,154	)		1,884			8,846			7,426
Taxes paid		(274	)		(401	)		(1,516	)		(3,283	)
Net (gains) losses including write-downs of financial items		(132	)		(303	)		(3,127	)		(76	)
Depreciation, amortization and write-downs		5,538			2,710			14,219			10,742
Associated companies		(82	)		179			(718	)		(1,231	)
Difference between expensed and paid pensions		13			288			362			134
Currency (gains) losses not relating to operating activities		34			(29	)		57			(78	)
Change in other accruals		1,049			587			868			42
Net cash flow from operating activities		4,992			4,915			18,991			13,676


Payments on purchase of tangible and intangible assets		(3,398	)		(2,377	)		(11,613	)		(6,536	)
Payments on purchase of subsidiaries and associated companies, net of cash received		(1,046	)		(271	)		(6,281	)		(506	)
Proceeds from sale of tangible and intangible assets and businesses, net of cash payed		395			335			1,112			2,850
Proceeds from sale of and payments for other investments		697			730			3,751			738
Net cash flow from investment activities		(3,352	)		(1,583	)		(13,031	)		(3,454	)


Proceeds and payments interest-bearing liabilities		(485	)		(953	)		(4,311	)		(7,022	)
Issuance of shares and repayment of equity		7			(4	)		33			25
Share buy back		—			—			(2,020	)		—
Dividends paid to minority interests		(4	)		—			(193	)		—
Dividends paid to Telenor’s shareholders		—			(91	)		(1,764	)		(890	)
Net cash flow from financing activities		(482	)		(1,048	)		(8,255	)		(7,887	)


Effect on cash and cash equivalents of changes in foreign exchange rates		(174	)		3			(268	)		45
Net change in cash and cash equivalents		984			2,287			(2,563	)		2,380

Cash and cash equivalents at the beginning of the period		4,097			5,357			7,644			5,264
Cash and cash equivalents at the end of the period		5,081			7,644			5,081			7,644

THE BUSINESS AREAS 4TH QUARTER


																																			Profit (loss)
																																			before taxes
	Total																Operating profit						Associated						Net financial						and minority
	revenues¹⁾						of which external¹⁾				EBITDA						(loss)						companies						items						interests
(NOK in millions)	2004			2003			2004		2003		2004			2003			2004			2003			2004			2003			2004			2003			2004			2003
Mobile		8,655			6,311			8,324		5,963		2,339			2,494			(1,789	)		1,432			38			(17	)		(278	)		(489	)		(2,029	)		926
Fixed		4,793			5,175			4,283		4,686		1,552			1,622			699			568			24			7			(48	)		(155	)		675			420
Broadcast		1,375			1,310			1,342		1,273		333			379			101			132			(2	)		(18	)		(93	)		(284	)		6			(170	)
EDB Business Partner		1,132			1,113			896		830		173			177			66			68			—			—			(7	)		(5	)		59			63
Other business units		878			1,048			766		891		166			232			81			62			21			(151	)		23			(6	)		125			(95	)
Corporate functions and Group activities		561			636			102		158		(82	)		(32	)		(179	)		(136	)		2			—			204			652			27			516
Eliminations		(1,681	)		(1,792	)		—		—		38			11			2			47			(1	)		—			(18	)		177			(17	)		224

Total		15,713			13,801			15,713		13,801		4,519			4,883			(1,019	)		2,173			82			(179	)		(217	)		(110	)		(1,154	)		1,884

THE BUSINESS AREAS FOR THE YEAR


																																		Profit (loss)
																																		before taxes
	Total															Operating profit						Associated						Net financial						and minority
	revenues¹⁾						of which external¹⁾				EBITDA					(loss)						companies						items						interests
(NOK in millions)	2004			2003			2004		2003		2004			2003		2004			2003			2004			2003			2004			2003			2004		2003
Mobile		32,952			23,810			31,570		22,483		11,618			9,567		3,027			5,224			694			1,639			873			(2,182	)		4,594		4,681
Fixed		19,266			20,509			17,440		18,796		6,277			6,665		2,794			2,531			50			8			(438	)		(736	)		2,406		1,803
Broadcast		5,347			4,820			5,212		4,661		1,495			1,229		589			181			1			(84	)		(471	)		(909	)		119		(812	)
EDB Business Partner		4,530			4,289			3,606		3,229		924			399		524			(4	)		—			(13	)		(44	)		(71	)		480		(88	)
Other business units		3,595			4,205			3,114		3,590		524			408		113			(120	)		(32	)		(318	)		(27	)		(314	)		54		(752	)
Corporate functions and Group activities		2,193			2,317			360		362		(81	)		23		(468	)		(364	)		3			(2	)		1,646			2,846			1,181		2,480
Eliminations		(6,581	)		(6,829	)		—		—		64			11		23			112			2			1			(13	)		1			12		114

Total		61,302			53,121			61,302		53,121		20,821			18,302		6,602			7,560			718			1,231			1,526			(1,365	)		8,846		7,426


ANALYTICAL INFORMATION			2002										2003								2004
	Q1		Q2		Q3			Q4			Q1		Q2		Q3		Q4		Q1		Q2		Q3		Q4
Revenues (NOK in millions)		11,563		12,011		12,210			13,042			12,606		13,223		13,491		13,801		14,284		15,624		15,681		15,713
EBITDA excluding gains and losses (NOK in millions)		2,926		3,155		3,778			3,599			4,184		4,448		4,886		4,781		5,010		5,342		5,586		4,407
Operating profit (loss) (NOK in millions)		602		691		488			(2,101	)		1,475		1,612		2,300		2,173		2,282		2,739		2,600		(1,019	)
Profit (loss) before taxes and minority interests (NOK in millions)		31		383		(105	)		(5,445	)		1,047		2,490		2,005		1,884		4,674		2,662		2,664		(1,154	)
Equity ratio including minority interests (%)		49.4		48.2		46.7			41.7			42.6		45.5		48.0		47.0		47.2		48.6		50.9		0.5
Net interest-bearing liabilities (NOK in millions)		24,449		25,717		27,645			26,872			26,139		25,317		21,584		17,817		19,297		21,973		20,596		19,195
Net interest-bearing liabilities/EBITDA excluding gains and losses last 12 months		2.6		2.5		2.3			2.0			1.8		1.6		1.3		1.0		1.0		1.1		1.0		0.9
Capex (NOK in millions)		1,879		2,161		2,169			2,680			1,230		1,314		1,460		2,450		1,471		4,012		3,140		4,122
Investments in businesses (NOK in millions)		8,875		2,271		493			772			23		268		9		263		3,749		294		644		1,122
No. of man-years		22,250		21,650		22,350			22,100			21,200		21,150		20,300		19,450		20,600		20,200		20,700		20,900
- of which abroad		7,700		7,800		8,600			8,900			8,700		8,700		8,100		7,450		8,650		8,750		9,450		9,500

MOBILE
Telenor Mobil — Norway
No. of mobile subscriptions (NMT + GSM) (in thousands)		2,314		2,360		2,409			2,382			2,342		2,330		2,364		2,364		2,378		2,451		2,562		2,645
No. of GSM subscriptions (in thousands)		2,249		2,299		2,352			2,330			2,294		2,285		2,324		2,327		2,346		2,422		2,536		2,623
- of which prepaid (in thousands)		1,051		1,094		1,131			1,115			1,093		1,091		1,120		1,099		1,091		1,118		1,178		1,228
Traffic minutes per GSM subscription per month, generated and terminated		171		185		186			178			178		190		195		189		192		198		198		191
Average revenue per GSM subscription per month in the quarter (ARPU):		334		351		359			340			330		346		354		326		332		348		345		330
- of which contract		481		511		528			492			480		501		519		475		488		515		526		526
- of which prepaid		162		168		171			170			163		172		174		162		154		153		134		124
No. of SMS and content messages (in millions)		391		403		444			454			452		462		500		512		488		511		560		610
Sonofon — Denmark
No. of mobile subscriptions (in thousands)		—		—		—			—			—		—		—		—		996		1,212		1,263		1,286
- of which prepaid (in thousands)		—		—		—			—			—		—		—		—		250		451		485		462
Traffic minutes per GSM subscription per month, generated and terminated		—		—		—			—			—		—		—		—		165		185		175		174
Average revenue per GSM subscription per month in the quarter (ARPU):		—		—		—			—			—		—		—		—		270		255		242		224
- of which contract		—		—		—			—			—		—		—		—		313		322		315		294
- of which prepaid		—		—		—			—			—		—		—		—		135		111		106		110
No. of SMS and content messages (in millions)		—		—		—			—			—		—		—		—		240		298		338		392
Telenor Mobile Sweden
No. of mobile subscriptions (in thousands)		—		—		—			—			52		59		65		81		84		92		96		105
- of which prepaid (in thousands)		—		—		—						26		23		28		44		48		54		56		57
Traffic minutes per GSM subscription per month, generated and terminated		—		—		—						28		41		67		76		80		104		118		117
Average revenue per GSM subscription per month in the quarter (ARPU):		—		—		—						119		160		207		199		188		202		218		195
- of which contract		—		—		—						194		248		311		294		295		311		365		305
- of which prepaid		—		—		—						44		49		56		105		105		122		118		117
Pannon — Hungary
No. of mobile subscriptions (in thousands)		2,001		2,146		2,311			2,450			2,514		2,514		2,564		2,618		2,596		2,588		2,595		2,770
- of which prepaid (in thousands)		1,446		1,596		1,767			1,910			1,989		1,981		2,019		2,023		1,977		1,936		1,886		1,991
Traffic minutes per GSM subscription per month, generated and terminated		113		115		112			112			104		110		113		116		111		121		127		131
Average revenue per GSM subscription per month in the quarter (ARPU):		182		184		177			177			153		165		170		173		169		176		184		174
- of which contract		383		391		401			415			386		414		416		412		396		386		390		351
- of which prepaid		97		98		94			100			86		92		97		99		94		97		100		96
DiGi.Com — Malaysia
No. of mobile subscriptions (100% in thousands)		1,159		1,284		1,454			1,616			1,803		1,946		2,055		2,207		2,416		2,585		2,806		3,242
- of which prepaid (100% in thousands)		1,044		1,176		1,351			1,519			1,708		1,850		1,953		2,101		2,301		2,453		2,653		3,067
Traffic minutes per GSM subscription per month, generated and terminated		197		189		185			185			177		175		177		176		167		164		170		166
Average revenue per GSM subscription per month in the quarter (ARPU):		169		158		138			145			123		111		117		117		116		110		112		100
- of which contract		313		331		312			352			331		336		367		357		358		352		337		266
- of which prepaid		150		142		124			131			112		100		105		105		104		98		100		90
Kyivstar — Ukraine
No. of mobile subscriptions (100% in thousands)		—		—		1,659			1,856			2,012		2,205		2,512		3,037		3,221		3,610		4,856		6,252
- of which prepaid (100% in thousands)		—		—		1,283			1,472			1,614		1,768		2,037		2,503		2,675		3,031		4,211		5,532
Traffic minutes per GSM subscription per month, generated and terminated		—		—		50			49			43		52		59		73		69		74		96		95
Average revenue per GSM subscription per month in the quarter (ARPU):		—		—		113			102			81		92		106		95		87		97		103		72
- of which contract		—		—		194			202			167		176		204		201		194		213		220		185
- of which prepaid				- -		73			70			54		66		74		70		62		69		76		55
GrameenPhone — Bangladesh
No. of mobile subscriptions (100% in thousands)		550		625		704			769			835		928		1,047		1,141		1,520		1,795		2,024		2,388
- of which prepaid (100% in thousands)		353		424		501			563			631		725		820		899		1,258		1,501		1,730		2,092
Traffic minutes per GSM subscription per month, generated and terminated		207		222		229			224			221		225		233		230		239		246		249		241
Average revenue per GSM subscription per month in the quarter (ARPU):		191		173		167			155			133		136		143		130		123		108		104		88
- of which contract		311		297		286			303			283		295		337		327		342		298		310		264
- of which prepaid		118		104		100			95			81		89		90		76		72		70		67		60
ProMonte GSM — Montenegro
No. of mobile subscriptions (in thousands)		—		—		—			—			—		—		—		—		—		—		340		279
- of which prepaid (in thousands)		—		—		—			—			—		—		—		—		—		—		297		235
Traffic minutes per GSM subscription per month, generated and terminated		—		—		—			—			—		—		—		—		—		—		67		55
Average revenue per GSM subscription per month in the quarter (ARPU):		—		—		—			—			—		—		—		—		—		—		176		115
- of which contract		—		—		—			—			—		—		—		—		—		—		504		287
- of which prepaid		—		—		—			—			—		—		—		—		—		—		92		66
Associated companies
No. of mobile subscriptions (100% in thousands)		12,424		14,425		14,814			16,116			17,158		15,105		17,035		19,478		21,028		24,594		28,662		33,763

FIXED — Norway
Retail market
No. of PSTN subscriptions (in thousands)		1,522		1,497		1,480			1,467			1,449		1,427		1,381		1,308		1,248		1,219		1,196		1,182
No. of ISDN subscriptions (lines in thousands)		1,803		1,818		1,818			1,828			1,816		1,800		1,755		1,682		1,600		1,548		1,498		1,449
PSTN/ISDN generated traffic (mill. minutes)		4,702		4,392		3,864			4,387			4,268		3,876		3,454		3,787		3,725		3,279		2,851		3,171
Market share of PSTN/ISDN generated traffic (%)		73		73		73			72			70		70		69		69		69		69		69		69
No. of Online subscriptions residential market (in thousands)		370		359		347			337			315		304		301		294		286		276		263		241
No. of ADSL subscriptions residential market (in thousands)		42		53		64			90			114		124		139		163		191		214		245		286
No. of ADSL subscriptions business market Norway (in thousands)		1		2		3			4			7		10		11		14		17		21		25		40
Wholesale market
No. of PSTN subscriptions (in thousands)		—		—		—			—			11		12		42		104		151		170		180		188
No. of ISDN subscriptions (lines in thousands)		—		—		—			—			14		17		52		126		188		215		234		250
No. of ADSL subscriptions (in thousands)		5		6		8			15			21		31		41		56		76		86		90		91
No. of LLUB (in thousands)		18		25		32			42			53		59		68		80		96		108		123		145

BROADCAST
No. of television subscribers in the Nordic region
- Subscribers with satellite dish (in thousands)		614		646		664			701			713		708		726		763		778		782		800		824
- Cable TV subscribers (in thousands)		557		559		561			571			575		590		594		604		605		611		614		624
- Households in small antenna TV-networks (in thousands)		1,140		1,126		1,129			1,133			1,130		1,049		1,100		1,098		1,132		1,161		1,190		1,212
		15		17		18			21			24		26		28		31		34		35		38		44

Special items


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
EBITDA		4,519			4,883			20,821			18,302
Gains on disposal of fixed assets and operations		(105	)		(130	)		(550	)		(232	)
Losses on disposal of fixed assets and operations		(7	)		28			74			229
EBITDA excluding gains and losses		4,407			4,781			20,345			18,299

Expenses for workforce reductions, loss contracts and exit from activities
Mobile		615			—			630			(21	)
Fixed		39			30			86			6
Broadcast		3			5			5			7
EDB Business Partner		(10	)		24			33			223
Other business units		11			6			28			38
Corporate functions and Group activities		10			18			116			34
Eliminations		—			—			—			—
Total workforce reductions, loss contracts and exit from activities		668			83			898			287


Adjusted EBITDA		5,075			4,864			21,243			18,586


Write-downs
Mobile		2,515			6			2,519			35
Fixed		15			17			15			24
Broadcast		20			9			20			18
EDB Business Partner		—			11			—			28
Other business units		—			23			39			37
Corporate functions and Group activities		—			3			3			3
Eliminations		—			—			—			—
Total write-downs		2,550			69			2,596			145


Adjusted operating profit		2,087			2,223			9,620			7,989


Special items associated companies
(Gains) losses on disposal of ownership interests		(15	)		1			(32	)		(1,507	)
Write-down Sonofon		—			—			—			—
		—			—			—			—
Write-down DTAC/UCOM		—			—			—			—
Write-down Oniway		—			—			—			—
Other write-downs associated companies		—			14			—			25
Total special items associated companies		(15	)		15			(32	)		(1,482	)

Net (gains) losses and write-downs financial items		67			(201	)		(2,564	)		(73	)

Adjusted profit (loss) before taxes and minority interests		2,004			1,748			9,268			6,300

Reconciliations


	4th quarter						Year
(NOK in millions)	2004			2003			2004			2003
Net income (loss)		(382	)		999			5,228			4,560
Minority interests		144			281			1,134			490
Taxes		(916	)		604			2,484			2,376
Profit (loss) before taxes and minority interests		(1,154	)		1,884			8,846			7,426
Net financial items		217			110			(1,526	)		1,365
Associated companies		(82	)		179			(718	)		(1,231	)
Operating profit (loss)		(1,019	)		2,173			6,602			7,560
Depreciation and amortization		2,988			2,641			11,623			10,597
Write-downs		2,550			69			2,596			145
EBITDA		4,519			4,883			20,821			18,302

Net (gains) losses on disposal of fixed assets and operations		(112	)		(102	)		(476	)		(3	)
EBITDA excluding gains and losses		4,407			4,781			20,345			18,299

Expenses for workforce reductions, loss contracts and exit of activities		668			83			898			287
Adjusted EBITDA		5,075			4,864			21,243			18,586


Operating profit (loss)		(1,019	)		2,173			6,602			7,560
Write-downs		2,550			69			2,596			145
Net (gains) losses on disposal of fixed assets and operations		(112	)		(102	)		(476	)		(3	)
Expenses for workforce reductions, loss contracts and exit of activities		668			83			898			287
Adjusted operating profit (loss)		2,087			2,223			9,620			7,989


Associated companies		82			(179	)		718			1,231
Special items associated companies		(15	)		15			(32	)		(1,482	)
Adjusted associated companies		67			(164	)		686			(251	)


Profit (loss) before taxes and minority interests		(1,154	)		1,884			8,846			7,426
Write-downs		2,550			69			2,596			145
Net (gains) losses on disposal of fixed assets and operations		(112	)		(102	)		(476	)		(3	)
Expenses for workforce reductions, loss contracts and exit of activities		668			83			898			287
Special items associated companies		(15	)		15			(32	)		(1,482	)
Net (gains) losses and write-downs financial items		67			(201	)		(2,564	)		(73	)
Adjusted profit (loss) before taxes and minority interests		2,004			1,748			9,268			6,300