TeliaSonera Finland President resigns

Company posts lower figures after "price erosion" in Finnish market

Anni Vepsäläinen

Esa Korvenmaa

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The President of TeliaSonera Finland Anni Vepsäläinen has tendered her resignation, the company reported on Tuesday. Esa Korvenmaa, responsible hitherto for the Large Corporate sector of the Finnish business, will take over from today as Acting President while the search goes on for a successor.
      The announcement stated that Vepsäläinen was leaving the company on her own initiative and to pursue other interests. She has worked for Sonera since 1987 and has headed the Finnish operations of TeliaSonera since 2003. Vepsäläinen commented that her departure and the weaker result posted by TeliaSonera were not connected.
     
"I joined the company practically straight from school, and I am thus still in my first place of employment. I'm now 41, and have been pondering what I would like to do next. Perhaps the moment has come to look for some new challenges", said Vepsäläinen to the Finnish News Agency STT.
      No severance package will be involved, as Vepsäläinen is leaving of her own volition.
     
TeliaSonera Chairman Tom von Weymarn noted in an interview with YLE TV-News that the negative publicity surrounding the company of late may have influenced Vepsäläinen's decision. He did not regard the announcement as a very great surprise.
      The Chairman's remarks were presumably a reference to the widely-publicised trial of former managers of the telecommunications service provider, who face charges over the illegal tracing of telephone calls in 2000 and 2001, and to announcements in February that the company was to shed some 650 jobs in Finland, despite having just turned in figures indicating a net result of EUR 1.6 billion for 2004. Earlier this month, the number of likely Finnish redundancies was reduced to just over 300. (See linked articles)
     
TeliaSonera released its first-quarter figures for 2005 today. They were somewhat disappointing. Net sales were up by some five percent to SEK 20,804 million (EUR 2,277 million), with sound development in most operations, but "price erosion" in Finland had reduced margins.
      Some analysts have gone so far as to describe the situation in Finland as "catastrophic", with usage not increasing sufficiently to balance the decline in prices in a fiercely competitive market. Profits also fell in Sweden, but they were down by as much as 85% in the Finnish market.
     
Sonera is not alone in feeling the chilly Finnish draft; one of its smaller local rivals, Saunalahti, issued a sharp profit warning on Monday for the first quarter and the entire year.
      TeliaSonera's operating income, not including non-recurring items, amounted to SEK 4,670 million (EUR 510 million; 1Q/2004: SEK 4,822 million). Net income totalled SEK 3,563 million (EUR 389 million) and earnings per share came to SEK 0.68 (EUR 0.074), down from SEK 0.73 a year previously.
      The immediate response was to see pressure on the company's stock, which was down over 6% in the early afternoon in Helsinki.
     


Previously in HS International Edition:
  TeliaSonera to dismiss no more than 330 people (12.4.2005)
  Prosecution in Sonera case demands suspended prison sentences (24.3.2005)
  Employees consider taking TeliaSonera to court over job cuts (17.2.2005)
  TeliaSonera to cut 650 jobs in Finland - overall reductions may amount to 2,000 (11.2.2005)
  Unequal job security measures irk Finnish TeliaSonera staff (1.2.2005)

Links:
  TeliaSonera

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