Annual and Sustainability Report 2011 - Teracom

Annual and Sustainability Report 2011

Teracom Group 

• The Teracom Group offers a wide range of communication solutions for radio and TV. 

The main product areas are Pay-TV, radio and TV broadcasting, transmision capacity 

services, co-location and service. 

• The Teracom Group consists of Teracom Sweden, Boxer Sweden, Teracom Denmark, 

Boxer Denmark and PlusTV in Finland. 

• The Group has a total of more than 1 million Pay-TV-customers. 

vision 

We deliver the best viewing and listening experience, characterized by personality, 

portability, simplicity and reliability. 

mission 

The Teracom Group offers TV and radio via terrestrial networks along with supporting 

Telecom services. 

group objectives 

Revenue: 

EBIT margin: 

Customer: 

Employee: 

Environmental: 

key ratios 

≥ 5% yearly growth 

≥ 2 percentage points annual improvement 

Most satisfied customers of our industry 

Highly motivated and dedicated employees 

Yearly decrease in environmental impact 

2011 2010 2009 2008 2007 

Income 4 059 3 852 3 408 2 991 3 312 

Operating profit/loss 376 293 496 635 625 

Operating margin, % 9 8 15 21 19 

Net income 168 201 269 460 470 

Return on equity, % 10 12 16 26 26 

Equity ratio, % 32 31 40 44 48 

Dividends to owners 110* 110 110 150 400 

Average number of employees 707 707 638 669 674 

* The Board of Directors' proposed dividend 

This is a translation of the original Swedish annual report. in the event of differences between the english translation and the Swedish original, 

the Swedish annual report shall prevail.

Read more about the 

Swedish business on page 14 


Danish business on page 20 


Finnish business on page 24 

The Teracom Group owns and operates digital 

terrestrial networks with Pay-TV services in 

three markets. Our core business also includes 

broadcasting of national and local radio. 

By having a presence along the entire value 

chain, from broadcast stations to TV viewers and 

their Pay-TV subscriptions, we can strengthen 

both our own business and the business of 

the broadcasters. We create opportunities 

for broadcasters to reach their audience, for 

viewers and listeners to easily have access to 

their content, while creating public benefit by 

deploying a multitude of different channels 

from many independent broadcasters. 

An integrated TV business 2-3 Important events 2011 4–5 A TV-centric business strategy 6–11 Sweden 14-19 Denmark 

20-23 Finland 24-27 The Teracom Group’s sustainability efforts 30 Environmental impact 31-33 Employees 34-35 

Media plurality requires a long-term perspective 36-37 GRI G3 Index 40-41 Financials 42-93 Definitions 96 

Production: Teracom Group and Åkesson & Curry AB in cooperation with Waldton Design. Printing: Göteborgstryckeriet. Photos: Pernille Tofte, pages 2, 15, 21, 25. 

Dawid, pages 56-57 (excl. Steffen Weber photo of Gitte Falkenberg). Mats Lundqvist, page 9, 11, 13, 34, 35, 37. Kurt Jørgensen, page 10. Stefan Berg, page 14, 28, 

29, 42, 94-95. Perikles Ladopoulos , page 17. Jens Ove Kristensen, page 22. Fabrice Dell´Anese/Corbis Outline/Scanpix, page 26. Bertil Strandell, page 31. Bo Pettersson, 

page 35. TV screen images: Jens Ohlsson/Scanpix, page 15. Murray Cooper/GettyImages/All Over Press, page 21. Reinhard Dirscherl/Getty Images page 25. 

1

An integrated TV business 

There are three things that I believe deserve special attention: In 

Denmark customers are beginning to pour in, we are continuing 

to work hard to increase the number of Pay-TV customers in 

Finland and we are integrating our TV business in Sweden and 

Denmark, the countries where we have both network and Pay- 

TV companies. Today we have a total of more than one million 

customers, a solid foundation for continued development. 

With a fully integrated corporate strategy, we are increasing our competitiveness. 

We need to launch our products faster on all markets, at the 

same time as we continue to streamline the Group and take advantage of 

all conceivable synergies. We have formed a completely new product development 

organization, which will be a Group function and service all of the companies. We 

have decided to further integrate our sustainability efforts in our business and set 

higher environmental standards for all of our companies. 

2

Denmark has been and continues to be the Group's major 

growth business where we have invested heavily to build a 

stable customer base of Pay-TV customers. Growth began to take 

off during the summer of 2010 and in the second half of 2011 

customers were pouring in. We are experiencing the same phenomenon 

as when we started Boxer in Sweden – slow growth at 

first, then an explosion. Through attractive pricing and packaging 

combined with clever marketing, we managed after a few years 

to become the largest digital Pay-TV operator in Sweden. I am 

convinced that we will achieve the same result in Denmark. 

Through the acquisition of BSD, which we renamed 

Teracom A/S in January, we now have both network and 

Pay-TV operations in Denmark and can begin to develop the 

business in a significantly simpler way than if we only owned 

the one company. As a concrete example, we were able to 

quickly draw up a larger-scale plan for the spring 2012 introduction 

of HDTV with the new DVB-T2 broadcasting technology. 

Part of the network will switch completely to DVB-T2, at 

the same time as we increase the efficiency of the rest of the 

network by investing in new equipment. 

We successfully introduced HDTV in Sweden following 

exactly the same strategy. By upgrading our terrestrial network 

to modern technology over time, we can offer more and better 

services. The long-term plan, is to completely transfer to the 

new DVB-T2 technology, and to switch off DVB-T, but this must 

be done in a commercially viable way, and must benefit both 

broadcasters and viewers. Such a transition requires far-reaching 

commercial consensus between the network and Pay-TV 

operators, as well as a synchronization of the companies' 

long-term and short-term plans. 

A seamless value chain 

An integrated business, like we have in Sweden and Denmark, 

provides a seamless value chain in our business. Between 

encoders in the broadcast station and the service organization, 

through quality assurance of boxes, packaging of TV channels, 

marketing and the store where Pay-TV subscriptions are sold to 

individual viewers. We are a Group that work as if we were a 

single company. Through integration, we take full responsibility 

for our infrastructure and our services, that the broadcasters’ 

content reaches out, for the experience of viewers and for the 

public benefit provided by the terrestrial networks. The terrestrial 

networks are crucial for ensuring that, in the long-term, a 

platform is available where countries can guarantee a variety of 

TV channels for most tastes and from many independent broadcasters. 

Our integration aims to increase the competitiveness of 

the terrestrial networks so they can continue to contribute to a 

comprehensive freedom of speech and communication. This is 

the most central part of our sustainability work; a direct relationship 

can be found between the business challenges we face 

and our contribution to society. 

broadcast. The great advantage of the transition to DVB-T2 is 

that we can eventually change over all channels to HDTV, the 

video standard that is designed for TV screens larger than 40 

inches. Another major advantage of our terrestrial networks 

is the ability to regionalize channels, to broadcast regionally 

adapted versions of a channel from different masts. Sveriges 

Television has been using this technology for regional news 

for a long time. The commercial channels use their regional 

versions to send advertising to a specific area that is of high 

commercial interest. In 2011 we signed agreements for 2012 

that allow us to broadcast 168 versions of eight channels in 

both high definition and standard formats. We would like to 

continue with this development and we believe that, within 

a few years, 500 HDTV channels will be broadcast in different 

versions, all over the country, but broken down by region. 

The flexibility of the terrestrial network is its great 

strength; we will develop that strength because it will make 

a major difference when HDTV is all that is marketable, when 

all broadcasters will demand regional breakdown and when 

the broadband networks are bottlenecked by the growing 

video streams over the open Internet. 

Supplementary services 

We have supplemented the linear selection of On Demand services 

with Boxer Sweden's launch of Boxer On Demand last fall. 

Our new product department is now working with the next 

generation of recording boxes, which offer new opportunities 

for customers to watch what they want, when they want. The 

Boxer box of the future takes maximum advantage of the terrestrial 

network’s ability to transmit all channels simultaneously, 

and has a connection to the Internet for On Demand and Play 

services. It has a large hard drive, many receivers that simultaneously 

record several channels and endless opportunities 

for customers to sort the content by personal preference. This 

is how we see our future – our terrestrial network delivers the 

primary service, linear broadcast TV, while the additional services 

are delivered via the Internet. Broadcast is what we know, linear 

TV is what our customers want, that is our role and our future. 

Broadcast TV also plays another important role in addition 

to being a good commercial business. Broadcast television 

in every country, all over the world, is the most important 

common arena for public debate. »We have all seen the disturbing 

pictures on TV,« said President Barack Obama, for example, 

when commenting on NATO’s upcoming intervention in Libya in 

the spring of 2011. That's what television is – a mass medium 

with well-known broadcasters that have earned the trust of the 

audience. That’s where the important things happen. The broadcasters’ 

brands and the trust they signal is a key component of 

our business. With our talented employees and our investments, 

I know that our TV business is long-term and highly competitive. 

The terrestrial networks have room for many highquality 

channels 

Broadcast is a superior method for transmission to an infinite 

number of receivers. The terrestrial networks specialize 

in broadcast and we will develop our business based on 

CRISTER Fritzson 

President and CEO of the Teracom Group 

3

Important events 2011 

TV 

Expansion of HDTV in the Swedish terrestrial 

network continued during the 

year. At year-end 2011/2012, 93 percent 

of households had access to eight HD 

channels, including Kanal 5 HD, TV3 HD 

and TV4 HD, which all began broadcasting 

during the first quarter. 

In early April, 3D TV was tested for 

the first time in a Nordic terrestrial 

network when Canal+ broadcast the 

AIK-Djurgården soccer derby. 

During the year a number of new 

agreements were signed with several 

major broadcasters about broadcasting 

commercials and programs in different 

geographic regions via the Swedish 

terrestrial network. The services were 

launched in February 2012. 

In February, PlusTV launched a new 

flexible packaging structure with 

attractive price points. During the fall 

additional cards were introduced as 

part of the offering. 

In March, Danish Boxer developed its 

offering with up to four additional 

cards as part of the basic subscription. 

The previously free TV channel 

TV 2, which became a Pay-TV channel 

in January 2012, was integrated into 

different packages in December. 

A decision was taken to begin HDTV 

broadcast in Denmark in April 2012. 

In November, Boxer in Denmark 

reached 100,000 customers. In early 

January, Boxer passed 200,000 customers 

and in February 2012 it reached a 

record-high 300,000 customers. 

On September 19, Boxer Sweden 

launched a campaign for the Mix 

package for SEK 129 a month, with no 

regular fees. 

In April, Boxer in Sweden lowered the 

price of 8 Mbit/s broadband to SEK 199 

per month, one of the lowest prices in 

the market and about SEK 100 lower 

than the offers Boxer's customers could 

receive from the major telecommunications 

operators. 

Boxer On Demand was launched 

in Sweden, which provides Boxer 

customers with access via a hybrid 

box to Filmbutik with SF Anytime, Play 

channels, and gaming and entertainment 

apps like Facebook, the Swedish 

Meteorological and Hydrological 

Institute and Twitter. 

Radio 

The Swedish Broadcasting Authority 

announced in its »Strategy for licensing 

of commercial digital radio« that 

it would allocate licenses for DAB+ 

for commercial radio during the year, 

though the licensing process has been 

delayed. According to the TV Broadcasting 

Authority, a call for applications will 

take place in spring 2012 and the application 

period will be extended after 

September 1, when the Public Service 

Committee will submit a report. 

On April 1 MTG Radio launched a new 

radio channel in the FM network, Radio 

1, the first commercial talk radio channel 

launched in Sweden. 

In the digital pilot network for radio, 

which Teracom Sweden operates, a 

number of channels started broadcasting 

during the year, four from SBS, 

one from Sveriges Radio and one from 

MTG Radio. 

4


On 1 June, Teracom Group AB became 

the Parent Company for the Group. 

At the end of January the name of the 

acquired company Broadcast Service 

Danmark was changed to Teracom A/S. 

Andrea Gisle Joosen began working on 

8 August as the new President of Boxer 

Sweden. 

Steffen Weber, CFO, was appointed as 

acting CEO for Teracom Denmark when 

Finn Søndergaard stepped down on 8 

November. 

Sustainability 

A decision was taken to integrate the 

Group's sustainability issues into the 

overall strategies moving forward. 

The Group strengthened its environmental 

efforts by appointing new 

environmental coordinators in all 

companies. The work aims to help the 

companies to carry out environmental 

activities to reduce their carbon 

footprint and thus achieve the environmental 

target, which applies to all 

companies within the Group in 2012. 

Short wave and medium wave broadcast 

from the stations in southern 

Sweden were discontinued during the 

year. Some equipment was sold, while 

other materials were handled under 

our scrap and waste management 

system. Teracom Sweden’s electricity 

consumption decreased as a result of 

the discontinued broadcast by about 

3 percent. 

A new mentoring program for junior 

managers in the Teracom Group was 

initiated during the year aiming at 

further developing leadership and our 

employees' skills. 

In March, the Group launched Guiding 

Stars, which managers and a dedicated 

team of employees implemented during 

the year. The employee survey showed 

that 93 percent of the employees were 

aware of the Guiding Stars program 

and that a full 67 percent could identify 

with them. 

An internal review revealed that Boxer 

Sweden and Boxer Denmark did not 

meet expectations with regard to 

packaging and electronic products. 

Agreements for practical management 

have been reached with the necessary 

suppliers and new internal procedures 

have been adopted. 

Teracom Denmark, which was acquired 

in 2010, is fully integrated in the 

Sustainabilit y Report. Teracom Group 

AB has been reported in the statement 

as a separate company since June 1; 

before that, it was reported as an integrated 

part of Teracom, Sweden. 

5

A TV-centric business strategy 

The Teracom Group is facing intensified competition in the 

Nordic market, which means that the Group needs to focus and 

invest in developing its core business – TV and radio. 

Viewing Patterns for linear TV in minutes 

per day 

210 

157,5 

105 

52,5 

0 

2006 

2007 

Growth of 

the Teracom Group 

2008 2009 2010 2011 

DK FI SE 

Source: TNS Gallup (DK), Finnpanel 

(FI), MMS (SE) 

Number of subscriptions for Teracom 

Group in thousands 

1200 

1000 

800 

600 

400 

200 

0 

2006 2007 2008 2009 2010 2011 

Boxer DK PlusTV Boxer SE 

Source: Teracom Group 

1992 Teracom AB is formed from Televerket 

(Swedish Telecommunications Administration) 

1999 Boxer TV-Access AB is formed with 

Teracom AB as 70 percent owner; 

the remaining 30 percent stake is 

purchased in 2008 

2008 Boxer TV A/S is formed and receives 

operator license for the upcoming 

Danish digital TV network 

2009 Teracom AB buys the majority stake in 

DigiTV Plus Oy (Plus TV) 

2010 Teracom AB buys BSD, which is 

renamed Teracom A/S 

2011 Teracom Group AB is formed as a 

Group company 

Competition between TV operators has increased, especially since TV has become 

the major broadband operators’ main service for attracting customers. Competition 

among broadcasters is also increasing, culminating in increasingly spectacular and 

interesting program ideas. TV holds its own not only as the largest mass medium, 

but as the medium with the largest economic resources, and thus the ability to 

attract talent for even more audience-pleasing program ideas. 

The main thrust of the Group's strategy is to enhance the competitiveness of 

the TV offering, create a strong Nordic presence to secure its market position in 

the long-term, work smart and cost-effectively and increase the skills and leadership 

within the Group. Effectively integrating network and Pay-TV strengthens the 

Group's position in the value chain. 

The competitiveness of the offer will increase by offering customers a wider choice 

in terms of both packaging and opportunities to watch TV whenever and however they 

wish. The terrestrial network offers a number of competitive attributes to be developed: 

• Watch scheduled TV programs whenever you want using smart recording 

features 

• Watch TV programs on any TV set in the home since the TV signal can be received 

anywhere and affordable packages with extra cards for Pay-TV 

• Watch TV programs on any TV set outside the home using more robust broadcast 

that reach more areas 

• Watch TV programs on any device suitable for viewing TV by developing 

receivers for tablets and similar screens as well as greater choice with more 

flexible Pay-TV packaging 

A mature market with rapid development 

All broadcast platforms for television have been digital for a long time, although 

cable distribution is essentially still analogue. IPTV via telephone and fiber networks 

has also been introduced, particularly by the major national telecommunications 

companies, which with their large financial muscles use television as a loss leader 

service to sell broadband. TV-like services, especially movies, are also becoming 

increasingly available online and it is becoming easier to integrate computer and 

television equipment, two technology platforms that previously lived separate 

lives in terms of image and connection standards, but that are now approaching 

each other. 

In Sweden, the Group worked hard during the year to broaden its service 

offering after the analogue switch-off. Broadband, IP telephony, more channels 

and new HDTV channels meant higher revenues per customer and new revenues 

for the network. The result was a good profit level, but the departure of nearly 

100,000 Pay-TV customers from Boxer could not be prevented. Therefore competitiveness 

needs to be further increased. 

Having a presence mainly in the Nordic countries is necessary to create the 

overall size and customer base required to be a priority platform and partner for 

broadcasters and equipment manufacturers. 

6

An integrated TV business 

The Group's strategy and planning assume that the TV business 

is a completely integrated business - from the broadcast 

station via the boxes out to the viewer, a viewer who is preferably 

a Pay-TV customer. This integrated business will be run 

in a similar way in market after market and the reason is, of 

course, that competition is growing and terrestrial networks 

must therefore be developed. There are three reasons why 

network and Pay-TV should sit together and expand into 

more markets: 

1. Development of services and technologies requires 

consensus and careful commercial coordination. 

2. The various TV markets share many similarities and the 

terrestrial networks function in much the same way, 

so investments and lessons learned from one market 

become far more valuable if they can be applied in other 

markets. 

3. A large general customer base is essential to achieve 

sufficient bargaining power against suppliers and broadcasters. 

The Swedish market is the most mature in the Teracom 

Group and services developed – HDTV, broadband, IP telephony 

and set top boxes for Video On Demand – will obviously 

be launched in other markets. It is important to take 

advantage of economies of scale in order to strengthen the 

competitiveness of the terrestrial networks in a financially 

sound way. 

The terrestrial networks in which network and Pay-TV are 

integrated will become more competitive, at least in small 

countries with several competing means of distribution and 

where advertising is not enough to finance the many free 

TV channels. The Teracom Group currently has an integrated 

business in both Sweden and Denmark, and the Group's aim 

is to achieve full integration in all markets. 

Strength in a dedicated broadcast platform 

The terrestrial networks offer great opportunities for development 

and there is a considerable need to strengthen the 

platform on both the network and service sides. In 2010 

HDTV was launched in the Swedish network using the new 

broadcasting standard DVB-T2, which radically optimizes 

frequency utilization. This technology makes it possible over 

time to completely switch to HDTV, which is becoming the 

image standard for all TV sets. The reason of course is that 

broadcast TV is competing with online video and image 

quality is one of the great advantages of a dedicated broadcast 

platform. DVB-T2 can also be used for many more channels, 

or a mix of HDTV and new channels. 

TV-like services can be accessed in an increasing number 

of ways. Movies can be rented via broadband, broadcasters 

offer on demand services that can be watched both live or 

stored, while YouTube and similar sites offer an abundance of 

videos from all over the world, many of them from television. 

Boxer's new On Demand service is also based on delivery via 

the customer's own broadband connection. All this underscores 

how traditional TV networks are challenged by more 

and more TV-like services over broadband. The traditional TV 

networks, which broadcast in one direction, offer a number 

of advantages that may become crucial as online video use 

increases: 

• An infinite number of receivers can be reached in the 

area covered by the broadcasts. Number of users does 

not affect capacity, unlike broadband, where each new 

user needs new capacity. This is crucial for live TV, an 

extremely capacity-intensive service for which people 

have little tolerance for delays. 

• The broadcast transmission is paid for by the broadcaster, 

which is either the program company or the Pay-TV operator. 

For the user, reception is free (of course customers 

buy a subscription for Pay-TV services). Households 

usually pay a fixed fee for broadband. This model does 

not work as well if capacity requirements radically 

increase from various media. Just who will pay for broadband 

services that demand more and more capacity is a 

major issue in the telecom world. Regardless of where 

the bill is sent, it has to be paid. This makes broadcast 

networks appear to be significantly more cost-efficient. 

• The new image standard will be HDTV, which requires 

much more capacity than standard TV and will pose 

major challenges for broadband networks and business 

models. 

Pay-TV 

Services and technologies 

introduced in the Group 

Network 

TV 

RADIO 

TELECOM 

1995 Digital radio (DAB) 

1999 Digital TV with DVB-T/MPEG2 

2007 Boxer TV navigator 

2008 Digital TV with DVB-T/MPEG4 

2009 Broadband 

IP telephony 

DAB+ 

2010 HDTV with DVB-T2/MPEG4 

Regional versions of national TV 

channels 

2011 Video-on-demand 

The Teracom Group’s strategy is based on the premise that the TV business is a completely cohesive business. 

7

How the Teracom Group meets 

the competition in the TV 

market 

Price 

• Strengthen the perception of »price leader« 

• Maintain high standards of quality and 

customer service 

Simplicity 

• Products are user-friendly in all respects 

• Easy to understand, find, choose and buy 

• Easy to install 

Contents 

• Large and medium-sized channels with 

highest audience share (SD and HDTV) 

• Add Video On Demand 

• An attractive selection of premium channels 

(sports) and niche channels 

Thus, broadband will not be the obvious future platform for TV broadcast, and the 

Group's digital terrestrial networks will continue to be one of the most important 

TV platforms. However, intensive business development and major investments are 

crucial and therefore the Group will completely focus on digital TV alongside with 

radio broadcast. Other business should be viewed as a complement that is offered 

to the extent it supports or is supported by the TV business. Such business will not 

represent new legs to stand on, but rather will offered because the infrastructure 

or other prerequisites already exist for the TV business and can easily be used for 

a new application. 

Radio 

The origin of the Group is in radio. Regular radio broadcasts to a wide audience 

began in 1921 in Sweden and 1922 in Denmark. Since the 1960s, the Group broadcasts 

on the FM band, which allows quite a few channels with good reception essentially 

everywhere and excellent sound quality. FM receivers are everywhere – in music 

systems, mobile phones, cars, safety helmets and anywhere that people want sound. 

Digital radio has been available in both Sweden and Denmark for several years. 

However, the FM band is full. It is virtually impossible to make room for more 

channels, especially for additional channels that broadcast nationwide, which is still 

of greatest interest to broadcasters. So digital radio is essential if the medium of 

radio is to be developed with new actors and new program formats. 

In Sweden, the Swedish Broadcasting Authority was commissioned by the government 

to announce licensing of commercial digital radio. Meanwhile, a public 

service inquiry was commissioned to investigate Sveriges Radio’s future DAB operations 

until the fall of 2012. To coordinate these two processes, the Broadcasting 

Authority has decided to wait with commercial licensing until spring 2012. It is a 

good decision because experience from other countries shows that it is crucial for 

all broadcasters to jointly address the radio issue. 

The Group's strategy is to develop its own platforms and includes not only the 

introduction of new technologies, but switching to the new technology and subsequently 

abandoning the old technology. The Group is working hard to encourage 

broadcasters and government agencies to invest in a nationwide expansion of 

TIME SHIFT 

You watch your programs 

when you want because the 

box records and sorts the 

programs for you. 

MULTI SCREEN 

You watch your programs on 

the receiver of your choice – 

on a tablet or other portable 

screen. 

MULTI ROOM 

You can conveniently and 

affordably watch all of your 

channels from a TV in any 

room. 

PLACE SHIFT 

FLEXIBILTY 

Simpler packaging where you 

can put together packages of 

your favorite channels. 

You watch your programs 

wherever you want – on the 

TV in the summer cottage, or 

somewhere else. 

8

digital radio and, in connection with this expansion, to decide when and how to 

switch off FM broadcasts. The strategy distinguishes between launching new technology 

and shifting to new technology. A launch means that radio listeners or TV 

viewers get more services if they get new receivers, but if they only want the old 

services, they can keep their old receivers. A transition means that the old technology 

is switched off, so new receivers are required to listen to, or watch, both old 

and new services. A transition is both commercially and politically risky and must 

be planned and closely coordinated. 

Transition to digital radio 

A transition to digital radio in itself is not unusual. Over a period of a few years 

in the 1960s the radio broadcasters switched from the AM band to the FM band 

currently in use. In TV, analogue transmissions were switched off after a period of 

parallel transmission with digital TV. The key to a successful transition is that the 

services provided by the new technology must offer users more than they get with 

the old technology. It is therefore important that program companies not only 

parallel broadcast their traditional services, but actually invest in new services to 

attract both old and new listeners so that a transition will be commercially viable 

for them. If broadcasters invest in new technology, a transition is also inevitable 

because long parallel transmission is not economically justifiable. 

The technology that the Group has been working with for a long time is DAB+, 

a development of DAB that allows very efficient frequency utilization and thus 

many more radio channels and other services across the country. Denmark has 

an extensive DAB network and the Group is carefully studying the possibilities of 

launching DAB+ so that it eventually replaces FM. 

With current regulation in Sweden and Denmark it is not at all obvious who 

would get the contract to build and operate the DAB networks. A nationwide infrastructure 

for radio and television, extensive experience and a focus on broadcast 

services all represent a great advantage for the Group. Analyses show that 

analogue radio, like TV, cannot compete in the long run with all the other ways to 

enjoy audio and video services and therefore must be digitized. DAB+ will accommodate 

many more program services with national coverage and a host of new 

services. When DAB+ penetrates the market, just like FM, there will be hundreds of 

millions of receivers in our Nordic markets. 

Average radio listening 2011 

per person and day 

136 

minutes in Sweden 

121 

minutes in Denmark 

Co-location and service 

In Sweden and Denmark the Group has nationwide infrastructures of stations and 

masts measuring from a few meters up to 330 meters. They include 78 tall masts, 

54 in Sweden and 24 in Denmark. Besides the tall masts, there are hundreds of 

smaller masts to reach areas not covered by the tall masts. The masts are attractive 

to all companies that need to transmit radio waves over long distances or that 

otherwise want to place their equipment high up. 

The strategy focuses on broadcast services, for which the major new investments 

are made. However, once the investments are made, it can be highly costeffective, 

both commercially and economically, to place as much equipment as 

possible in the infrastructure. The Group's tall masts comprise a unique national 

infrastructure built to reach as many people as efficiently as possible. Therefore 

co-location and service are important complements to the Group’s core business, 

which is radio and TV broadcasting. 

Connection services 

Teracom offers two products in the Connections business area: Wavelength and 

Capacity. Both services involve offering customers the opportunity to transfer data 

from one location to another via the Group's network. The Group currently has one 

of Europe’s most modern wavelength networks and offers customers the opportunity 

to use 1, 2.5 or 10 Gbit/s in them. Since the Group has both fibre and radio links, 

it can offer customers redundant paths and high availability. The fibre network, with 

Teracom Group on World DMB 

Board of Directors 

Per G. Borgå, product manager Radio 

Teracom Group, was elected to the Board 

of Directors of WorldDMB in 2011. This 

responsibility is accompanied by the opportunity 

to influence digital radio strategies 

internationally and gain greater insight into 

newly established markets such as Germany 

and Australia. 

»It feels like the digital radio trend is 

moving in the right direction, but of course 

it could go faster. Being elected to the Board 

is an honor and I hope to convert the experience 

into practice in our own market, now 

that commercial radio will have the opportunity 

to start digital broadcasting,« says Per. 

World DMB’s Steering Board (SB) consists 

of 16 participants and carries the strategic 

responsibility for the organization, which 

includes purely operational issues and 

financial management of World DMB. 

9

Digital radio 

Digital TV 

thousands of kilometers of cable extending from Kiruna in the north and Bornholm 

in the south, is being continuously expanded to meet the needs of our customers. 

The strategy includes utilizing our existing backbone for radio and TV and combining 

it with other types of services. 

Co-locations: 

GSM, 3G/4G 

FM radio, 

Private local 

radio 

Co-locations: 

Link 

The Teracom Group’s nationwide infrastructure 

is well suited for co-location of communication 

equipment. 

Terrestrial networks have several stakeholders 

Besides the Teracom Group, there are two very important parties that exercise 

control over the terrestrial networks, with whom it is important to have close relationships. 

Governments and regulatory authorities regulate and control licensing 

since the terrestrial networks play an important role in media policy. The Teracom 

Group's influence is directly proportional to the ability to support the agreed 

national media policy. 

Licensing of broadcasting in the terrestrial networks follows a political 

ambition to achieve a variety of program services for all tastes and many independent 

broadcasters. This ambition is ultimately about protecting the airwaves as 

well-functioning platforms that are independent of special interests, an arena for 

public discourse and thus for political democracy. For the Group to have a sustainable 

business in terrestrial networks, it is important to ensure that licensing works 

in practice. And that means it must be commercially viable – for the Group and 

especially for the broadcasters. Essentially, terrestrial networks should rest equally 

on political and commercial considerations and must always be of benefit to both. 

The terrestrial networks exist for the broadcasters and their program content 

is the purpose of allocating spectrum for broadcasting. The role of the Teracom 

Group is to enable broadcasters to reach many viewers on acceptable financial 

terms. At the same time, it is important to establish that while the Group certainly 

includes most of the value chain in TV, so far it has refrained from becoming 

engaged in terms of ownership of program content. The reason, of course, is that 

the Group’s role as a facilitator is based on equal treatment of all broadcasters. 

This table summarizes the prioritized areas for the Teracom Group’s sustainability efforts. 

Area Incentive Governance 

Society 

Employees 

Good working conditions and skills development 

motivates employees to perform. 

Work environment, gender, education, career, 

employee reviews, salary statistics. 

Suppliers 

Ensure that the Group's suppliers meet required 

sustainability standards. 

Dialogue with existing and potential suppliers using the 

Group's basis for supplier evaluation. 

Media plurality 

Environment 

Greenhouse gas emissions 

Legal requirements 

Finance 

Financial value generated 

Development and technical maintenance of the 

terrestrial network are essential for this type of 

distribution to be perceived as long-term. 

The Group will strengthen its competitiveness by 

minimizing its environmental impact. 

As a state owned company with important social 

functions, fulfillment of legal requirements is 

particularly important. 

Financial earning capacity, in relation to the Group's 

costs, must support long-term development. 

Investment plans, licensing, spectrum allocation, crisis 

management, joint drills with customers. 

Environmental policy, preventive environmental work 

and refocusing parts of the Group where the opportunity 

to have an influence is large. 

Occupational health and safety instructions, safety 

committee work, incident management, environmental 

regulations. 

Through interim reports and an annual report that 

includes a sustainability report. 

10

Subsidized public transportation encourages 

people to leave their cars at home 

Since 2008, Boxer Sweden and Denmark have offered an environmental 

bonus. The purpose of the environmental bonus has been 

to encourage people to commute to work using public transportation. 

More than half of all employees take advantage of this highly 

appreciated benefit. In connection with the move to the new, shared 

head office, the opportunity for subsidized public transport will now 

be extended to all employees in Stockholm. 

Corporate social responsibility 

The Earth's natural resources are finite and it is important for companies to work 

so that the business is sustainable. Today's generations and companies must be 

able to exist and evolve while ensuring that future generations will have the same 

conditions. 

Being on the leading edge of this field offers great advantages since international 

institutions, particularly the EU, increasingly recognize the importance of 

laws and regulations supporting sustainable development. Companies that have 

already adapted to become a more considerate business will have a head start 

when the time comes for regulations to be imposed. As a state-owned company, 

the Teracom Group already meets requirements from the owner to work with and 

report on sustainability efforts. More and more companies are also requiring their 

suppliers, just as Teracom Group does, to work and report on sustainability in order 

to be a sustainable partner. 

Our challenge is to develop our sustainability efforts, where environmental 

work is an important part, as a natural part of our commercial work. Greater 

emphasis will be placed on this work over the next few years. 

Environmental strategy 

To be responsible and competitive, the Teracom Group needs to work even more 

proactively to reduce its negative environmental impact. The result will be better 

control of the risks in the area, better procedures for environmental incidents and 

greater credibility with customers, shareholders, suppliers, employees and other 

stakeholders. The Group also has the opportunity to continually become more 

effective and resource-efficient and thus also to reduce both costs and environmental 

impact. 

The Teracom Group wants to be at the forefront of environmental efforts. 

Therefore, the Group formulated an environmental policy and set one of its 

overarching business objectives to reduce its carbon footprint by three percent 

annually. The Teracom Group chose this target because it plans to reduce its 

carbon footprint at the same rate as the climate goals that the Government set for 

Sweden, by 40 percent from 1990 to 2020. Each company will identify its biggest 

impact areas annually and formulate activities in its business plans to reduce its 

carbon footprint. Teracom Sweden worked on this target in 2011, but in the future 

the carbon footprint reduction target will apply to all of the companies. To accomplish 

this, the Group’s main principle is to streamline and control its activities. 

Gradually switching over to renewable energy sources and more modern technology 

will also help the Teracom Group achieve its environmental goal. As a last 

resort, compensation for emissions would be considered. The biggest impact areas 

for the Group are electricity and fuel consumption, followed by travel in the form 

of business trips and commuting. 

The biggest environmental 

impact areas 

for the Group are elec tricity 

and fuel consumption. 

Maria Åstrand, Environmental 

Manager Teracom Group. 

11


operations 

12

Sweden 

Sweden is the Group’s first and most mature market. The 

Swedish digital terrestrial network and Boxer were launched in 

1999 and the last analogue broadcast ended in the fall of 2007. 

Despite increased competition, Boxer is still Sweden's biggest 

digital TV operator. 

Sales and operating margin 

Teracom Sweden 

MSEK % 

1500 

40 

2011 

1200 

900 

600 

300 

0 

2009 

2010 


■ Sales MSEK ■ Operating margin % 

32 

24 

16 

8 

0 

• HDTV broadcasts reached 93 percent of households at year-end. 

• Boxer launched on demand services as a complement to the linear TV 

experience. 

• Several larger program companies decided to broadcast regional 

content via the terrestrial network. 

• On April 1 MTG Radio launched Sweden's first commercial talk radio 

channel, Radio 1. 

Sales and operating margin 

Boxer Sweden 

MSEK % 

2100 

1575 

1050 

40 

30 

20 

During the year Group-wide Guiding Stars and leadership principles 

were launched. An internal mentoring program aimed at junior 

managers was initiated. 

Number of employees at Boxer Sweden: 53 

Number of employees at Teracom Sweden: 445 

525 

10 

0 

2009 

2010 


■ Sales MSEK ■ Operating margin % 

616 542 

Pay-TV subscribers for Boxer Sweden on 

December 31, 2011. 

0 

Boxer Sweden, Teracom Sweden and Group functions started moving into 

a new office together; the building is environmentally certified and environmental 

initiatives will continue together with the new property owner. 

Operating profit for Teracom Sweden was only marginally lower in 2011 

than in 2010. Higher income from services such as regionalization and 

telecom compensated for the somewhat lower income from regulated 

products. An accrual effect of changed invoiced sales for Boxer Sweden 

resulted in lower income during the first half of the year and reduced 

the operating margin. A lower customer base and higher costs for 

transmission and marketing also had an impact. Campaign with a lower 

price point for Boxer Mix had a positive impact on new sales. 

14

Popular entertainment and sporting 

events generate high viewing figures. 

15

The market 

The competition primarily consists of satellite operators Canal Digital and Viasat, where 

Viasat in particular has aggressively purchased exclusive sports rights, cable operator 

Comhem and IPTV operator Telia. Telia has achieved strong growth in recent years 

through IPTV as part of a Triple Play offering. The Group is strengthening its competitiveness 

and responding to the growing competition by launching new services. 

HDTV 

During the year, HDTV broadcasts in MUX six and MUX seven, a total of eight 

channels, continued to be expanded and reached over 93 percent of households 

at year-end. The broadcasts were launched in November 2010 using broadcasting 

standard DVB-T2 and MPEG4 compression technology. 

The general trend is to introduce more HD channels since, as TV screens are 

growing in size, HD is becoming the new image standard. The five largest Swedish 

channels broadcast their HD channels alongside their regular channels. Broadcasting 

HD and regular channels simultaneously over a transition period allows the 

number of viewers with HD receivers to increase as households upgrade their TV 

equipment. The long term aim is to replace standard channels with HD channels. 

However, this transition should be done in conjunction with the broadcasters filling 

their HD channels with almost exclusively »native HD«, which is not the case today. 

The HD launch is successful; Boxer has sold many HD subscriptions and the 

subscription price was reduced during the year from SEK 59 to SEK 19 per month. 

At the same time, reactions in the local press in places where HD is being expanded 

indicate a demand for SVT in HD resolution. 

Newspaper clippings from the HD rollout. 

HDTV broadcasts reached 93 percent of 

households at year-end. 

MIX 

FRIA KANALER – GÅR ATT SE UTAN ABONNEMANG 

Regionalization demonstrates the strength of the terrestrial network 

SVT1, SVT2 and TV4 have been broadcasting various regional editions of their 

channels for a long time. For these two broadcasters, regional editions provide an 

opportunity to broadcast regional news, but TV4 takes advantage of this opportunity 

to broadcast regional advertising. Consequently, TV4 can sell advertising to 

a target group that previously could only turn to the local press. This local advertising 

market is highly profitable, as demonstrated in the financial performance of 

large local press groups. 

During the year the Group signed agreements establishing regionalization of 

SVT’s HD channels, TV4 HD, Sjuan, TV3 and Kanal 5. These channels will also be 

able to compete in the regional advertising market, which means that the terrestrial 

network has generated great value for the broadcasters. Roughly speaking, 

the terrestrial network broadcasts about 160 different channel editions from these 

four broadcasters. Since regionalization entails good business for all parties, the 

aim is to sell the service to most broadcasters. 

The flexibility and competitiveness of the terrestrial network can be illustrated 

by a sample calculation that assumes that far more channels will buy regionalization 

to take advantage of the regional and local advertising market. If half the 

channels in the terrestrial network, about twenty-five, were to purchase regionalization 

into 20 regions each, the terrestrial network would broadcast 500 regional 

channels. The scalability and flexibility of the terrestrial network makes this manageable, 

despite the enormous aggregate bandwidth required by 500 channels. 

With satellite TV, for example, transponder capacity would need to be arranged 

for all channels from one point. This advantage of the terrestrial network would 

increase sharply over time as channels in the terrestrial network switch to HD 

format; 500 HD channels would then require a huge aggregate bandwidth, which 

can be handled through the decentralized structure of the terrestrial network. 

Program package offering. The Boxer Mix 

package costs SEK 179 per month and is 

Sweden's most popular Pay-TV package 

Boxer On Demand 

With the launch of Boxer On Demand in November, the Group has now also started 

to take advantage of the Internet as a distribution channel for some content. The 

launch was carried out with a Boxer-branded, custom-designed HDTV and On 

16

New office »Lyckan« – kind to the environment 

The new office in Lindhagen was built and adapted for an office lifestyle that supports 

good environmental work. The »Green Lease« means that the Group and the landlord will 

continue to work together to reduce the office’s environmental footprint – also in the 

future. 

Three specific examples of energy efficiency features in the building are smart temperature 

control, using cold air outside the building to cool equipment and automatic presence 

and daylight sensors. The entire building is certified under the »Miljöbyggnad« (Environmental 

Building) rating system, which is based on Swedish construction and government 

regulations, and the building will most likely be certified under »LEED« (U.S. certification for 

buildings) on the second highest level. 

»Every workday we support environmental targets and I hope it makes us very proud of 

our new workplace,« says Maria Åstrand, Environmental Manager, Teracom Group. 

Demand box. The service provides access to a movie store from SF Anytime, on 

demand services from several major broadcasters and a range of other services. 

Access to SF Anytime is part of the regular Boxer subscription, but a charge for 

each movie the customer rents is added to the regular bill. 

Most notable about this launch is that Boxer is the only Pay-TV operator 

offering on demand services from SVT. SVTr, or SVTrepris, is an on demand service 

offering almost half of the material available through SVT Play online. 

The HD/On Demand box is a »hybrid« box; it receives signals from the Group’s 

own terrestrial network and from the open Internet via the customer's own 

broadband connection. Movies and Play material are streamed from the Internet and 

the time delays that may occur with an ordinary broadband connection are resolved 

by the box buffering the material by temporarily storing it on the hard drive. This 

technique allows viewers to freely watch streaming programs via broadband. 

Through the new HD/On Demand box, the Group has established a hybrid 

platform for future services, both via the terrestrial network and via broadband. 

This platform can then apply the lessons learned in Sweden for use in the Group's 

other markets. 

500 

Room for more than 500 channels in the 

terrestrial network thanks to efficient 

new technology. 

Digital radio, the way forward 

The Group has broadcast digital radio using the DAB standard since 1995, and 

since 2009 broadcasts have also been provided using the advanced standard, 

DAB+. Although these broadcasts are pilot broadcasts provided in parts of Sweden 

and despite their limitations, several broadcasters are participating in the broadcasts 

and DAB+ receivers are present in a growing number of receivers on the 

market, so from the perspective of many listeners, digital radio is already available. 

However, the pilot broadcasts do not benefit from the major competitive benefit 

of digital radio, which is to provide many broadcasters with the opportunity to 

broadcast across the entire country. Now that the digital broadcasts have started 

to reach a broader audience, the strategy is to specifically discuss switching off 

analogue FM broadcasts. In Norway, for example, the government has decided to 

discontinue FM broadcasts in 2017 and it would not be unreasonable for Sweden 

to follow suit some time thereafter. 

Digital radio depends on political decisions and the Swedish Broadcasting 

Authority has decided to issue broadcasting licenses in two multiplexes, representing 

around thirty national channels. Since the continued commitment of Sveriges 

Radio to digital radio is being examined in a public service inquiry that will be 

completed in the fall of 2012, the Swedish Broadcasting Authority decided to 

delay licensing for 2012 so that the commercial license holders and Sveriges Radio 

can coordinate their efforts. Teracom Sweden is planning on expansion once the 

broadcasters have consulted one another. 

On April 1 MTG Radio launched Sweden's 

first commercial talk radio channel, Radio 1. 

17

67 

PR5 

Customer satisfaction 

for Boxer 

Sweden: 

Customer 

satisfaction for 

Teracom Sweden:63 

Co-location and service 

Teracom has a nationwide infrastructure of stations and masts which range from 

just a few meters to as much as 330 meters in height. Most facilities are associated 

with a mast and 54 of these are tall masts. 

Teracom’s facilities are attractive to all enterprises that need to establish local 

or nationwide communication networks. The unique high-altitude masts enable 

companies to cover a large area and reach many end customers. 

Teracom offers 24/7 monitoring and field service for customers’ equipment 

through Teracom’s NOC (Network Operation Center) and service personnel. Service 

personnel are available throughout the country, ready to be dispatched to resolve 

problems, regardless of whether the equipment is in Teracom's own facility or the 

customer's facility. 

The largest co-location and service customers are Nokia Siemens Networks, 

TeliaSonera, Net 1, SES ASTRA, 3GIS and Telenor. Other customer segments include 

broadband providers, utility companies, transport companies and other types of 

firms or authorities that establish their communications equipment by leasing 

space in Teracom’s facilities. 

In 2011, the mobile operators initiated installation of 4G networks in many 

Teracom facilities. 

This business deal is 

ideal for us; we can 

take advantage of our 

existing backbone network 

for radio and television, 

and combine it with other 

types of services 

Teracom Sweden’s CEO Stephan Guiance 

on the ten-year agreement with Statkraft 

Connection services 

Teracom offers two products in the Connections area: Wavelength and Capacity. 

Both services involve offering customers the opportunity to transfer data from 

one location to another via Teracom's network. Since Teracom has both fibre and 

radio links, it can offer customers redundant paths and high availability. 

Teracom's fibre network with about 6,000 kilometers of cable in a ring 

structure extends from Kiruna in the north to Malmö in the south and is constantly 

expanded to meet customer needs. Teracom currently has one of Europe’s 

most modern wavelength networks and security is integral to the product through 

extensive experience from radio and television networks. 

Boxer, Sweden's largest Pay-TV operator. 

18

At the end of the year, Teracom signed an agreement with Statkraft, which 

covers connection services and support services for delivery of masts. Statkraft 

owns and operates about 60 hydropower plants in Sweden and the task is to 

connect the facilities with Statkraft’s operational control centers all over the 

country. The plants and the operational control centers are connected together in 

Teracom’s existing national nationwide fibre and microwave backbone network. The 

network will be owned, operated and monitored around the clock by Teracom. 

Small differences between players, work faster and smarter 

Boxer has lost its two-year run as the operator with the most satisfied customers, 

though the differences between operators are shrinking compared with the 

previous year. This year's customer satisfaction index is 67 (67), somewhat better 

than the average for the industry (66). The customers want more choice and better 

customer care. Perceived value for money has greater weight as a result of the 

increased competition. 

After an earlier six-point upswing, the results for Teracom dropped to 63 (66). 

Customers see Teracom as competent, delivering high quality and credible. At the 

same time, they want shorter lead times, clearer communication and faster product 

development. Process efficiency will allow the company to work both smarter and 

faster in relation to customers. 

Environmental work in Sweden 

Teracom Sweden has been working on environmental issues for a long time, while 

Boxer Sweden has recently started this work. A major joint effort preceded the 

renovation and move to the new office where the Swedish companies have been 

working together since January 2012. 

Teracom Sweden is actively working with many environmental issues such as 

waste management, high-frequency electromagnetic fields (which form around 

the antennas when broadcasting radio and TV) and the impact of the vehicle fleet. 

In 2011, Teracom Sweden reduced electricity consumption as a result of the closure 

of a broadcast station in Hörby and continuous energy efficiency improvements 

when replacing equipment. However, expansion of the DTTV network and the new 

transport network in 2011 increased electricity consumption. A larger proportion of 

purchased electricity is also produced by fossil fuel than in 2010. 

Fuel consumption in Teracom Sweden rose since service previously provided 

by contractors is now provided by our own staff. This has also led to an increase 

in the service organization staff by about 10 percent. The environmental goal is 

set taking into account that the business should be able to grow or decrease in 

scope and that the organization would be adjusted accordingly. The management 

of Teracom Sweden decided to make a financial compensation contribution for 

its carbon footprint for 2011 to achieve the climate target of -3 percent. In 2012, 

environmental work will focus on implementing energy efficiency measures with 

monthly internal reports on the results, and finding good measurement parameters 

to clearly describe progress. 

For many years, Boxer Sweden has offered its employees a monthly environmental 

bonus for leaving the car at home and riding a bicycle or using public 

transportation to work instead. In December 2011, use was 61 percent, an increase 

from 46 percent in 2010; the total also includes those who have company cars and 

Boxer Denmark employees. With the move to the new headquarters, the possibility 

of subsidized public transportation has been extended to apply to all Group 

employees in Stockholm. 

One important environmental aspect for Boxer Sweden is the impact of the 

boxes on the environment, which will be identified in 2012 to develop a box 

strategy with environmental activities focused where they will make the greatest 

difference. 

Environmental activities 

decide d for the Swedish 

companie s: 

• Streamlining of energy consumption, 

e.g., at Teracom Sweden’s larger FM/TV 

stations. 

• Streamlining of fuel consumption, e.g., by 

continuously improving planning of work 

in the field for Teracom Sweden’s service 

organization. 

• Analysis of the environmental impact of 

Boxer Sweden’s boxes. 

Boxer Sweden's breakdown of 

climate impact 

Fuel 41% 

Business trips 38% 

Commuting 8% 

Freight transports 

6% 

Premises 4% 

Fuel production and 

shipment 3% 

Electricity and 

district heating 0% 

Teracom Sweden's breakdown of 


Fuel 45% 



Commuting 8% 


Freight transports 5% 


shipment 3% 

Premises 1% 

Teracom Sweden's change in 


1600 

1280 

960 

640 

320 

0 

A B C D E F 

■ 2010 ■ 2011 

A: Fuel 16% 

B: Electricity and 

district heating -2% 

C: Commuting -23% 

D: Business trips -21% 

E: Freight transports 

-12% 

F: Fuel production and 

shipment 9% 

The picture shows the areas in the operations 

that are monitored and converted into 

climate impact. The appearance of the graph 

for 2011 is primarily due to more projects 

and an expanded service organization, which 

resulted in higher fuel consumption. Teracom 

Sweden has decided to make a financial 

compensation contribution for its carbon 

footprint in order to achieve its climate 

target. 

A: Bränsle 16% 

B: El och fjärrvärme -3% 

C: Pendling -6% 

D: Tjänsteresor -3% 

E: Godstransporter -12% 

F: Bränsleproduktion 

och transport 14% 

19

Denmark 

Denmark is the Group's youngest market with both network 

and Pay-TV operations. Boxer Denmark became operational in 

November 2009 following the closing of the Danish analog terrestrial 

network. On January 6, 2012, Boxer Denmark reached 

200,000 customers and the 300,000 mark was reached already 

in February. 

Sales Boxer Denmark. 

MSEK 

300 

200 

100 

0 

2009 2010 

■ Sales MSEK 



• Boxer Denmark exceeded 300,000 customers on February 5, 2012. 

• During the year TV 2 decided to become a Pay-TV channel and made 

the switch in January 2012. 

• Decision was taken to launch HDTV in Denmark in 2012. 

The margin for Boxer Denmark is 

negative due to startup costs. 

SEK 345 

million 

Sales for Teracom Denmark 2011. 

During the year Group-wide Guiding Stars and leadership principles 



Number of employees at Boxer Denmark: 33 

Number of employees at Teracom Denmark: 65 

19 % 

Operating margin for Teracom 

Denmark 2011. 

The carbon footprint was analyzed to identify the most important 

aspects on which to focus moving forward. 

300 000 

Pay-TV subscribers for Boxer Denmark 

February 5, 2012. 

Teracom Denmark has long-term contracts that provide stable revenue; 

new business in the telecom sector has developed with both new and 

existing customers. Boxer Denmark has a strong position in the Danish 

Pay-TV market as a »Preferred Brand«; the number of subscribers 

increased dramatically over the past year. Revenue increased by almost 

80 percent over the previous year but, as expected, the result is still 

negative since the business is in an expansion phase. 

20

A multitude of channels enables 

niche TV viewing. 

21

Chris Corneliussen, Boxer 

Denmark’s 100,000th customer, 

together with Carsten 

Howard from Boxer Denmark. 

Boxer Denmark 

Boxer Denmark reached 100,000 customers 

during the first week of November 2011 

and Chris Corneliussen from Slagelse on 

West Sealand was the lucky customer. Chris 

received a 50-inch Panasonic television and a 

one-year subscription for Boxer Mix. 

»It was with great pleasure that we 

celebrated our 100,000th Boxer customer. We 

reached this important benchmark exactly 

two years after the digital transition. It took 

about 700 days to reach the first 100,000 

customers, less than 70 days to pass 200,000 

and only 30 days later we passed 300,000,« 

says Boxer Denmark’s CEO Steen Ulf Jensen. 

Pay-TV in Denmark 

Boxer has a government permit with exclusive rights to operate Pay-TV in four 

multiplexes until 2020. The purpose of issuing a permit for a Pay-TV operator, an 

arrangement that does not exist in Sweden or Finland, is to increase competition 

in the Danish television market, a situation to which Boxer has greatly contributed. 

The Danish Pay-TV market, like the Swedish market before Boxer became established, 

is dominated by relatively large and therefore expensive TV packages. The 

Group's strategy has been to break in at package and price levels that are attractive 

to people who want the right amount of television, not too much and not too little. 

This strategy applies to customers with other operators who feel they do not benefit 

from everything they buy, as well as customers who until now have been content with 

the terrestrial network’s free television offering, DR and TV 2’s channels. The sense of 

freedom of choice created by Boxer’s flexible packaging has been extremely important. 

As is typical with subscription services, significant investments were required, 

which have resulted in initially negative results. However, once the customer base 

surpasses a certain level, the profits will be substantial. 

VALUE FOR 

PEANUTS 

Scan og se mere 

TV 2 

BEGRÆNSET ANTAL 

TIL INTROPRIS 

199kr. 

for 12 mdr. 

Betalingskanal fra 11.01.12 

Disse kanaler Disse kan du kanaler altid se med kan Boxer-udstyr du altid se med Boxer-udstyr 

Fra nytår bliver TV 2 betalingskanal. 

In early January, Hvis du popular ser TV 2 med TV antenne, 2 became skal du have a Boxer. Pay- 

OPLYSNING TIL 

Her TV 2 med i alle pakker og du kan endda få den 

SEERNE OM BOXER 

TV channel in Boxer Denmark’s offering. 

*Samlet mindstepris 237 kr. (199 kr. i årlig kortafgift + 2x19 kr. i abonnement). Gælder kun ved 

tilmelding til PBS. Abonnementet løber tidligst fra d. 11.01.12 – du kan som altid se TV 2 med 

som selvstændig kanal. 

Boxer-udstyr frem til denne dato. 

* 

SPAR 

228 kr. 

ekskl. 

modtagerudstyr 

Packaging and pricing 

Boxer has worked hard with packaging and pricing. In March, up to four extra cards 

were offered as part of the basic subscription – two extra cards in the basic package 

and two children’s cards. This means that households can easily purchase Boxer-TV for 

every TV in the family and thus take advantage of the simplicity with which the signals 

from the terrestrial network can reach an unlimited number of devices. In May, the 

Consumer Council's publication TÆNK named Boxer »most cost-effective TV operator«. 

Most important of all is that, following a political decision in March 2011, TV 2 

became a Pay-TV channel in conjunction with the technology shift from MPEG2 

to MPEG4. TV 2’s transition to Pay-TV has fuelled interest in Boxer’s services and 

although many customers are probably signing up for a subscription in order to 

+ årlig kortafgift 

på 199 kr. 

Samlet pris 

watch * TV 1. år: 2, 237 kr.* the percentage of TV 2-only subscriptions has been small. Boxer has in 

fact greatly increased sales of its regular subscription services in connection with 

the channel’s transition. The transfer of TV 2 from MPEG2 to MPEG4 was accomplished 

through close cooperation between sister companies Boxer Denmark and 

Teracom Denmark since the project also involves relocation of TV 2 and its regional 

channels from MUX 2 to Boxer’s MUX 3. 

19 

kr./md. 

* Intropris i begrænset antal dog senest inden 01.04.12. Samlet mindstepris ved 

tilmelding til Betalingsservice: 199 kr. i årlig kortafgift. Abonnementet løber tidligst 

fra d. 11.01.12 – du kan som altid se TV 2 med Boxer-udstyr frem til denne dato. 

Normalpris pr. 01.04.12: årlig kortafgift 199 kr. + 19 kr./md. 

www.boxertv.dk 

22

Two years after its launch in November 2011, Boxer passed 100,000 customers 

and, only 70 days later in January 2012 Boxer passed 200,000 customers. The high 

growth rate from the end of the year continued into 2012 and on February 5 Boxer 

reached a record level of 300,000 customers. Boxer began 2011 with four percent 

of the Pay-TV market and ended the year with eight percent. 

HDTV with DVB-T2 

In late 2010, the Group purchased the Danish terrestrial network operator, Broadcast 

Service Denmark, from the public service companies DR and TV 2. The company changed 

its name in January 2011 to Teracom A/S and is now an integrated part of the Group's 

business. It has already resulted in an aggressive plan to introduce HDTV to DVB-T2 in 

Boxer’s Denmark selection in spring 2012. Through this strategy the Danish terrestrial 

network has also initiated a gradual upgrade to better picture and sound quality and 

more efficient broadcasting technology that will allow room for more services. 

65 

PR5 


for Boxer 

Denmark: 

56 

Customer 

satisfaction 

for Teracom 

Denmark: 

The 800 band 

Denmark is planning to hold an auction for the 800 band in early 2012. The 

Group has therefore been working on moving channels and vacating the 800 

band. Sweden introduced a clear rule in which a disturbance, according to a 

given definition, must be immediately remedied at no cost to viewers. The Danish 

Telecommunication Authority is working on similar rules, but the decisive factor is 

still how they will be implemented in practice. 

Digital radio 

Denmark started broadcasting DAB at the same time as Sweden, in 1995, but has 

made more progress in deployment. Two multiplexes that are mainly used by DR 

provide 90 to 95 percent of the country’s area with good indoor reception. An estimated 

35 percent of the population listens to DAB radio regularly. 

The planning now under way involves sharing the two multiplexes between DR 

and future commercial channels. No decision has been taken to switch off the analog 

FM network, although DR has stated that it would like to see such a decision within 

the next few years. Teracom is actively promoting further expansion and, together 

with its Swedish sister company, investigating the feasibility of introducing DAB+. 

Radio is part of the Group's core business and the Group is at the forefront of the 

transition to digital radio which, in one way or another, is underway in most countries. 

Environmental coordinators 

The environmental coordinators are responsible 

for proposing, supporting and following 

up on agreed environmental activities in 

order for the companies to achieve the 

overall environmental goal. Since impact of 

the companies on the environment varies, 

the focus varies, too; for example, Teracom 

Denmark focuses on energy efficiency 

for broadcasting equipment, while Boxer 

Denmark has chosen to review its electricity 

subscription and travel arrangements. The 

environmental coordinators themselves 

represent extensive expertise in the business. 

Environmental activities decided 

for the Danish companies 

• Review the possibilities for changing electricity 

subscriptions and improving travel 

procedures for Boxer Denmark. 

• Review broadcast equipment, etc., for 

Teracom Denmark to make it more energy 

efficient. 

Large inflow of customers poses challenges for Boxer Denmark 

Boxer’s customer satisfaction dropped to 65 (67), still somewhat over the industry 

average. Customer growth surged at Boxer during the year and a small portion of 

customers had to contact customer service, at the same time as the total number 

of calls increased. The score is still better than the average in the market and Boxer 

is perceived as the most cost-effective operator. 

Teracom achieved a customer satisfaction score of 56 in its first survey as part 

of the Teracom Group. Customers perceive Teracom as a company that delivers 

high-quality products and offers a selection of services with market-oriented 

service levels. Areas for improvement that Teracom Denmark will focus on are 

image in the market and customer loyalty. 

Environmental work 

Focused environmental work is in the startup phase in Denmark. The carbon footprint 

was analyzed to identify the most important aspects to focus on moving 

forward. Emissions from largely coal-based electricity in Teracom Denmark drastically 

increase the Group's total emissions. A large and important challenge 

for Teracom Denmark is therefore to reduce energy consumption by working to 

achieve more efficient electricity use. 

Boxer Denmark’s breakdown of 



Fuel 32% 

Premises 13% 

Freight transports 

6% 

Commuting 3% 


shipment 2% 



Teracom Denmark’s breakdown of 




Premises 2% 


Commuting 1% 

Fuel 1% 



shipment 0% 

23

Finland 

PlusTV is the largest Pay-TV operator for individual subscribers 

on the Finnish market and the terrestrial network is the 

dominant TV platform. 

Sales PlusTV 

MSEK 

600 

400 

200 

0 

2009 2010 

■ Sales MSEK 

Operating margin PlusTV 

% 

0 

-5 



• Intensive efforts together with several broadcasters have been made 

to increase the attractiveness of Pay-TV. 

• PlusTV’s churn has decreased during the year as a result of methodical 

work. 

• In February a new flexible packaging structure with attractive price 

points was launched. During the fall, additional cards were introduced 

as part of the offering. 

-10 

-15 

-20 

2009 2010 2011 

■ Operating margin % 

During the year, Group-wide Guiding Stars and leadership principles 



Number of employees at PlusTV: 30 

237 800 

Pay-TV subscribers for PlusTV on 

December 31, 2011. 

Environmental work in Finland is in the startup phase. To promote 

internal involvement, the company formed a separate environmental 

group. 

The Finnish Pay-TV market has exhibited weak growth during a twoyear 

period due to the wide selection of free TV. Demand is also driven 

by the seasons for sporting events, which had a positive impact on sales 

toward the end of the year in connection with the ice hockey and skiing 

seasons. 

As a result of good sales and decreasing churn, the customer base grew 

by almost 13,000 customers in the fourth quarter. 

24

Social media evolve exponentially. Every day, broadcast TV 

delivers new and interesting topics. 

25

Kimi »The Iceman« Räikkönen 

is back in Formula 1 and is 

broadcast exclusively on MTV3 

MAX and PlusTV 

TV viewing in Finland is strongly related to 

sports and sporting events, especially sports 

that involve wheels. This type of content and, 

of course, the rights to it, are crucial for the 

number of subscribers and viewers. PlusTV 

has exclusive rights in the terrestrial network 

for the channel that will broadcast Formula 1 

with the very popular Formula 1 driver: Kimi 

»The Iceman« Räikkönen, who signed a two 

year contract with Renault. 

Finnish market 

The Group acquired a majority shareholding in PlusTV in 2009 when the company 

was three years old and had worked up a sizable customer base. However, the 

customer base has declined since then because the aim was to have a stable stock 

of long-term loyal customers, rather than to have many customers at any cost. 

Churn is significantly lower today than it was three years ago and it is also on 

the decline. The Finnish market differs from the other Nordic markets because the 

major broadcasters have traditionally focused on advertising-supported Free to 

Air television and to a lesser degree on developed channels for Pay-TV. The large 

number of free TV channels poses challenges because viewers are not accustomed 

to subscribing for Pay-TV to be able to see their regular TV channels. People are 

willing to pay for exclusive sports rights, but that is an expensive way to get 

customers. 

Packaging 

The Group is working intensively with the broadcasters to find opportunities 

to transfer interesting content to Pay-TV in a way that commercially benefits 

both parties. For the broadcasters, Pay-TV provides a relatively secure source of 

financing, unlike advertising, which is highly cyclical. At the beginning of the year, 

the Verraton package was launched with five new Pay-TV channels, including a 

sports channel that left the free TV domain. Intensive collaboration with Canal+ 

during the spring culminated in the launch of the fantasy series Game of Thrones. 

As a result, Canal+ sales increased by 150 percent in April and 75 percent in May. 

26

Because Pay-TV is closely associated with sports, subscribers come and go on a 

fairly regular basis, depending on the season. MTV3, the large Bonnier-owned 

program company, purchased the rights to the major ski races next year and the 

plan is to broadcast most of them as Pay-TV, with a positive impact on sales in the 

autumn. 

The aim is to work with broadcasters to create Pay-TV packages that are interesting 

for permanent subscriptions, just like those on the other Nordic markets 

where Pay-TV penetration is almost 80 percent of households, compared with 

around 35 percent in Finland. 

The Finnish terrestrial network currently has three network and three Pay-TV 

operators. However, new players find it difficult to break into the market because 

of the low growth rate and PlusTV is holding on as the major operator with the 

most interesting offering and the strongest brand. The new Pay-TV operators 

have focused on HDTV, but this appears to be a bit premature since interest in the 

market has been limited. 

HDTV 

In the long run, however, HDTV is interesting since large screens need a better 

image standard, so preparations are underway to launch HDTV. Preparations are 

also in progress to launch Boxer’s On Demand service and to bring Boxer and 

PlusTV closer together in every way. The impact of PlusTV’s offering could increase 

considerably by quickly launching Group-wide services. 

Future 

The Group’s focus is on combining the roles of network and Pay-TV operators 

to influence the development, thereby increasing the competitiveness of terrestrial 

networks, and if this is not feasible, effecting closer cooperation. In Finland, 

the strategy is to invest in an appropriate number of Pay-TV channels with the 

right content. Appropriate packaging and pricing have been the priority, as well 

as increasing the Group’s presence in the retail sector. Here PlusTV has a major 

competitive advantage because the company and the brand are well known, 

representing good services and reliable delivery in the eyes of the customer. Thus, 

in the Finnish market, competition is within the terrestrial network to a greater 

extent, whereas in other countries competition is between the terrestrial network 

and other TV platforms. The strategy must therefore be slightly different than in 

other markets, and the aim is to promote development of the Finnish terrestrial 

network and to become more competitive over time. The most immediate task is 

to continue strengthening the position of Pay-TV in the Finnish market, so that 

both operators and broadcasters can have the financial resources to develop the 

services that viewers and customers will demand in the future. 

Customers appreciated the repackaging, but they want more 

Overall satisfaction among PlusTV customers remained at about the same level in 

2011, 62 (63), which is somewhat below average for the industry (65). The major 

categories of product quality, service quality and affordability have all improved. 

The fact that overall satisfaction does not reflect satisfaction with price and 

product is probably due to higher expectations, fueled by new players on the 

market. 

62 

PR5 


for PlusTV: 

Green power in Finland 

Seven employees who are also environmental 

role models have gathered in Finland to 

discuss how PlusTV employees can easily 

and conveniently increase the environmental 

commitment of the company. Elina Leino, 

environmental coordinator and Head of PR 

and Communications at PlusTV, is behind the 

initiative. The group calls itself Green Power 

and plans for 2012 include holding garage 

sales, increasing waste sorting and collecting 

clothes for charity. »It's a fun initiative that 

may provide motivation and visibility for the 

agreed major environmental activities to be 

carried out in 2012,« says Maria Åstrand, 

Environmental Manager at Teracom Group. 

Environmental activities 

decided for PlusTV 

• Review travel procedures and reduce 

emissions from travel for PlusTV. 

• Increase internal environmental commitment 

at PlusTV. 

PlusTV’s breakdown of climate impact 


Commuting 11% 

Fuel 10% 

Premises 1% 


shipment 1% 




Environmental work at PlusTV 

Environmental work in Finland is also in the startup phase. To promote internal 

involvement, the company formed a separate environmental group, »Green Power«. 

The hope is that this initiative will increase the penetration of larger environmental 

activities, such as reducing travel. 

27

Sustainability 

- corporate 

responsibility 

The Teracom Group has developed greatly in recent years and 

sustainability has become more important both internally and 

externally. 

The Group's sustainability efforts have been categorized based 

on the three concepts of society, environment and finance. 

• Read more about how our sustainability work is guided in the Directors’ Report. 

28

Many of the Group's masts and facilities are located in remote places. 

The easiest way for Teracom's service technicians to reach Ryfjället, 

1,413 meters above sea level, is by helicopter or snowmobile. 

29

The Teracom Group’s sustainability 

efforts 

How the Group communicates 

with its different stakeholders 

Owner 

Customers 

Employees 

Suppliers 

Ongoing dialogue, 

reporting 

Ongoing dialogue, customer 

surveys, seminars 

Employee reviews, 

surveys 

Purchasing policy, regular 

evaluations 

Materiality analysis 

When the Teracom Group's sustainability efforts were initiated in 2008, the work 

group at that time conducted a relevance analysis. This analysis identified stakeholders, 

the Group's level of influence and control over stakeholders and the 

importance of stakeholder relationships in terms of sustainability. The result was 

a compilation of important target groups, which are listed in the adjacent table. 

At the same time, a relevance analysis was conducted of sustainability issues 

that provided the basis for the selection of indicators, as well as the selection of 

reporting areas for governance. Since then, prioritized issues associated with the 

Group's sustainability efforts have been analyzed and developed in accordance 

with decisions by the governance group. These decisions, along with action plans, 

provide the guidance for continued sustainability efforts. 

Partners 

Ongoing dialogue 

Media 

Government 

Authorities/ 

Departments 

General Public 

The Teracom Group’s 

prioritized areas 

Society 

• Employees 

• Suppliers 

• Media plurality 

Environment 

• Greenhouse gas emissions 

• Legal requirements 

Finance 

• Financial value generated 

Contact should be based on 

facts, accessibility, relevance 

and honesty 

Ongoing dialogue, feedback 

on proposals 

Customer service, online 

Follow-up of the action plan 


• The most important sustainability aspect is the Group's carbon footprint. The 

Teracom Group therefore set a new objective to reduce its CO 2 

emissions, for 

application beginning in 2011. 

• Sustainability assessments of the Group's suppliers are an important component 

of taking greater responsibility for the Group's sustainability impact. 

These efforts also expanded in 2011 by entering into a dialogue with small 

suppliers and suppliers to all of the Group’s companies. 

• A survey is being conducted to identify the consumables used by Teracom 

Sweden and how these items are purchased. This will allow for stricter 

requirement s on such repeat purchases. 

• The travel patterns within the Group will also be reviewed with the aim of 

achieving conformance on how travel and meetings are conducted. 

• In 2010 and 2011, the Teracom Group focused on corporate governance and 

forming an affiliated company. 

• Sustainability dialogues with key customers will be implemented over the next year. 

• Teracom Denmark is now an integrated part of the Sustainability Report. 

Action plan 

2012 

• Review the travel process for the entire Group with the goal of creating a 

Group-wide travel and meeting policy. 

• Develop the sustainability assessment of the Group's suppliers. 

• Hold stakeholder dialogues with the most important customers. 

• Begin implementation of the environmental goal for all companies within the 

Group. 

2013-2014 

• Enter into a dialogue with other stakeholders: ones that have shown a direct 

interest and ones that have been identified by the Group (such as customers 

and suppliers). 

2015 

• Complete sustainability assessments for suppliers that account for 80 percent 

of the Group's purchasing costs. 

30

Environmental impact 

The Group’s companies have offices, products, facilities and networks 

that all affect the environment in one way or another. 

Since 2008, efforts have been underway to document the ways 

in which the Group most significantly affects the environment. 

Today there is a good picture of the environmental impact of the 

organization and the areas of improvement that require work. 

• Read more in the Directors’ 

Report/Corporate Governance 

Report regarding environmental 

management for environmental 

incidents within the Group. 

Environmental goal 

The Teracom Group's environmental goal is to decrease the Group's climate impact 

each year. In 2011 the goal for Teracom Sweden was to reduce greenhouse gas 

emissions by an average of 3 percent per year and, moving forward, this goal 

applies to the entire Group. 

To achieve these reductions, the main strategy is to make the operations more 

efficient. Gradually switching over to renewable energy sources and more modern 

technology will help the Teracom Group achieve its environmental goal. As a last 

resort, compensation for emissions will be considered. 

In 2011, the Group carried out a series of activities aimed at identifying its 

environmental impact, gaining better control over it, setting up action plans and 

developing dialogues with stakeholders. 

The Teracom Group has an 

impact on the environment 

primarily in three areas: 

• Electricity consumption 

• Fuel consumption 

• Emissions associated with the goods and 

services it purchases, such as business 

travel and shipments. 

Examples of activities carried out in 2011 

• To achieve better control of Teracom Sweden's waste management, the 

company continued to work with the central agreement for all offices and 

stations in Sweden. Implementation is now complete and will be further evaluated 

in 2012. 

• Since 2009, the Group has carried out supplier assessments which are now a 

natural part of the purchasing process. Suppliers are asked about issues such 

as environmental work, human rights and quality. 

• The Group has conducted a survey of its environmental impact from Teracom 

Denmark’s activities. 

• Boxer has continued to encourage its employees to leave their cars at home 

by offering an environmental bonus for using public transport and in 2012 all 

Group employees in Stockholm have the opportunity to receive subsidies for 

public transportation. 

In order for the Teracom Group to achieve its environmental goal in 2012, the 

companies decided to carry out environmental activities (see examples in the 

section for each country). In addition, the Group will also engage in Group-wide 

activities in the following areas: 

• Revision of the environmental policy and clarifications to the management 

system and environmental processes 

• Follow-up of goals and activities 

• Environmental communication – internally and externally 

• Car policy and tougher environmental requirements when purchasing vehicles 

A new car policy will be developed in 2012. 

-3% 

The Teracom Group will reduce 

greenhouse gas emissions by an 

average of 3 percent annually. 

31

The Group's breakdown of 




Fuel 11% 


Commuting 3% 

Premises 2% 



shipment 1% 

• Improvement of travel patterns, including better opportunities for video 

conferences 

• More stringent environmental and energy requirements when making 

purchases 

Energy consumption and environmental impact 

The Teracom Group's largest impact on the environment is from fuel and energy 

consumption, which also directly impacts the Group’s operating costs. 

In order to decrease the Group's fuel and energy consumption, a number of 

initiatives have been implemented to streamline its energy use. Data on direct 

and indirect energy consumption has also been compiled and converted into CO 2 

equivalents. In 2011, data on Teracom Denmark’s consumption was also identified 

and converted into CO 2 

equivalents in order to quantify the Group’s carbon 

footprint. This work has been used to set goals and form action plans that will 

reduce the environmental impact. 

EN3 

The Group's fuel consumption 

The Group's direct energy consumption is the fuel consumed by the various 

combustion engines owned or leased by its companies. In 2011, fuel consumption 

increased due to an increase in the service business. For example, the Group's 

direct energy consumption comes from its use of: 

• Company cars (business use and/or private use), snowmobiles, four-wheelers, 

all-terrain vehicles, etc., that are fueled by diesel, gasoline or ethanol. 

• Mast elevators and mobile power stations that are fuelled by gasoline. 

• Backup power stations fuelled by diesel. 

facts 

Greenhouse effect 

Heating of the surface of the earth caused by 

the earth’s atmosphere. The effect is due to 

part of the thermal radiation from the earth's 

surface being re-radiated back to the earth 

after being absorbed by the atmosphere. 

CO 2 

equivalents 

A common unit of measure that makes it 

possible to compare the climate impact of 

various greenhouse gases, their converted 

greenhouse effect expressed in the equivalent 

amount of carbon emissions. 

CO 2 

emission 

EN4 

Emissions of carbon dioxide or converted 

equivalents. 

Electricity consumption of network companies 

Operating a nationwide terrestrial network for TV broadcast consumes a great deal 

of electricity. The Teracom Group has offices and stations that use energy, specifically 

electricity, heat and cooling. In 2011 energy consumption for the Group was 

about 139 GWh. The GRI index presents the Group’s total consumption of electricity 

and heat purchased directly from producers as well as the energy consumption 

of premises using indicator EN4 (energy consumption for premises was 

reported in 2010 in indicator EN17). 

The Group's indirect energy consumption comes from its use of electricity, 

district cooling and district heating. The network companies’ services (broadcasting) 

and operation of stations in Sweden and Denmark account for 98 percent of 

energy consumption. 

The production mix for electricity in the Danish operation consists of 27 

percent renewable energy sources (biomass/biogas and wind/water and solar 

energy) and 73 percent non-renewable energy sources (mainly coal) and explains 

the large increase (four times greater than 2010) in the Group's emissions. 

About 99 percent of Teracom Sweden’s energy consumption is electricity 

purchased from an electricity supplier where the primary energy sources consist of 

53 percent renewable energy and 47 percent non-renewable energy sources. The 

renewable sources are primarily water power and, to a smaller extent, wind power. 

The non-renewable sources consist almost exclusively of nuclear power. Electricity 

subscriptions in the two countries have a variable production mix from year to 

year, which means that emissions for the Teracom Group change in the same way. 

An electricity loss of about 3 to 9 percent occurs during transmission from power 

plant to Teracom Sweden's facilities. 

32

The Group's greenhouse gas emissions 

To reflect the Group's total carbon footprint and identify which parts can be 

improved, the Group compiled its total direct and indirect greenhouse gas emissions 

and converted its energy use to CO 2 

equivalents. In 2011, the Group further 

documented its impact by including transports (freight shipments, business travel 

and commuting), fuel production and energy usage at the Group's leased facilities. 

This work will continue to evolve in 2012. 

EN16 

EN17 

Product responsibility 

In the fall of 2011, the Teracom Group realized that it had not properly addressed 

its product responsibility for certain consumer electronic equipment 

that was imported and sold in the Nordic market in 2011due to 

changed sales processes in the Boxer companies. New internal 

procedures were adopted and cooperation has been initiated 

with organizations in different countries, which help 

the company meeting the obligations of its product 

responsibility. These organizations are: Repa and 

El-kretsen in Sweden, and Elretur in Denmark. 

In Finland, no electronic products have been 

sold yet, though a similar collaboration will be 

launched before sales begin 

in the spring of 2012. 

SUNDSVALL 

STOCKHOLM 

HELSINGFORS 

KÖPENHAMN 

The picture shows the environmental impact of the Teracom Group through 

activities that the Group carries out within the business. Examples are electricity and fuel 

consumption, as well as transports, business trips and the use of offices. The red and white 

markings on the map symbolize where the Group has its larger FM/TV masts. 

33

Employees 

For the Teracom Group, highly motivated and committed employees 

is a strategic issue and a necessity for the Group to 

achieve its goals; the aim is to create a truly attractive workplace. 

The year was characterized by intensive work with the 

Group-wide Guiding Stars and leadership principles. 

Group-wide 

mentoring program 

Catarina Myhrman, section manager for Network 

Systems at the Networks department 

within Teracom Sweden, is one of this year's 

novices in the Group’s newly started mentoring 

program. Her mentor is none other than 

the Group's CEO, Crister Fritzson 

»Of course I’m looking forward to having 

Crister as my mentor. He is a clear and 

inspiring leader, and it is truly a privilege to 

have the opportunity to discuss leadership 

and other important matters with him,« says 

Catarina Myhrman. 

Leadership 

The Group’s core values and Guiding Stars are important in its effort to act as a 

unified business and encourage employees to work toward the same goals. The 

Group's managers play an important role in this process. Five leadership principles 

will help to guide them in their daily work. Leadership must be business-driven, 

action-oriented, communicative, involving and goal-oriented. Creating a common 

culture and obtaining an understanding of the entire business process goes hand 

in hand with developing the Group's leadership principles. How well our managers 

live up to the leadership principles is assessed in the annual employee survey. 

A mentoring initiative was implemented during the year. A structure for a 

Group-wide internal mentoring program was designed. The program began in 

January 2012 and will continue for one year. The target group is junior managers 

who want to develop their leadership skills, and mentors are members of corporate 

and Group management. In addition, since 2008 the Group has participated in 

Womentor, a mentor program for women early in their managerial career in the IT 

and telecom industry. 

Group-wide Guiding Stars in the Teracom Group 

During the year, the Group presented new common Guiding Stars. Formulating 

these new Guiding Stars was a thorough initiative that used the previous values 

and guiding principles of the five companies as a point of departure. After just 

six months, 65 percent of employees felt they could identify with the words that 

describe their daily work and how the Group wants customers to perceive us. 

We simplify, We build trust, We make a difference 

Leadership principles within the Teracom Group 

Business-driven 

By understanding a changing world and choosing 

a proactive approach, we can act in time and take 

calculated risks. Our ability to weigh customer 

benefits against our own profitability requirements 

will help us secure business in the long term. 

Action-oriented 

By making decisions based on experience, judgment 

and available facts, we will reach our goals 

even without a requirement for consensus. We 

act decisively and energetically to ensure effective 

delivery. 

Communicative 

By being transparent, honest and clear, we build 

security and bring out the best in our employees. 

Our communicative mission is to create an open 

dialogue for mutual understanding of our reality. 

Involving 

By recognizing the talents and diversity of our 

employees, we create participation and a strong 

sense of cohesiveness within the Group. Our 

enthusiasm for being leaders and role models is 

obvious and provides energy for everyone. 

Target-driven 

By clearly linking individual goals to Group goals 

and long-term strategy, we create motivation and 

accountability. We ensure our goals by always 

prioritizing, following up on results, acting on 

deviations and celebrating successes. 

34

To further gain support for the Guiding Stars within the organization, a Guiding 

Star Team monitors and promotes their development and use. Of course it is 

everyone's job, especially the managers, to contribute to a development in which 

the Guiding Stars are used as an aid in day-to-day activities, but the Guiding Star 

Team is an assurance that all of the activities carried out are also rooted in the 

cultures and countries in which the Group is active. 

Employee survey 

The Group carried out a joint and Group-wide employee survey for the first time in 

2011. The Teracom Group intends to conduct such surveys regularly to evaluate the 

effectiveness of employee motivation and identify areas that could be improved. 

The response rate was an impressive 95 percent and the results are summarized 

through two indexes: Team Efficiency Index (TEI) and Leadership index (LSI). The 

2011 survey shows a TEI for the Group of 83, with an external benchmark index 

of 85. 

The goal for next year's survey is to achieve 90 for the entire Group. Boxer 

Denmark has the highest TEI (89). About 40 percent of the Group’s employees feel 

there are no obstacles at all to efficiency or productivity. 

The Leadership Index for the Teracom Group (an aggregate average of all 

managers) was 70, which is slightly lower than the benchmark (71). Group 

Functions, Boxer Sweden, Teracom Sweden and Teracom Denmark are slightly 

below the benchmark, while PlusTV is slightly above. Boxer Denmark scored above 

the index. The survey shows that managers do a relatively good job of complying 

with the leadership principles. 

Regarding commitment, which is essentially based on two parameters, energy 

level and clarity of objectives, the energy level is higher than clarity of objectives 

within the Group. In all, 65 percent believe they understand how the work group’s 

objectives support the corporate goals and 58 percent feel that the work group’s 

goals are converted into individual goals. 

All work groups have analyzed the results, in part to understand how strengths 

can be retained or enhanced, and in part to identify reasons for weaknesses. All 

work groups establish an action plan with relevant and practical activities aimed at 

improving the working climate and thus profitability. 

Leadership and efficiency 

One of the managers in the Teracom Group 

who received both a high LSI and TEI in 2011 

is Magnus Oldenburg, CIO Teracom Sweden. 

»The most important aspect about my 

approach to leadership is to have an open 

dialogue with my staff so they feel part of 

the Group’s development.« 

Employee performance and 

development review 

• 94 percent of employees had performance 

reviews during the past 12 months. 

• 86 percent received established goals and 

a development plan. 

• 81 percent received feedback on their performance 

in relation to established goals. 

facts 

LA12 

TEI: Team Efficiency Index – measure of the 

work conditions in the Group with a focus on 

profitability. 

LSI: Leadership Index – measures leadership 

based on parameters such as the leadership 

principles. 

Kayaking 

In addition to the possibility to receive individual wellness subsidies, 

various group activities are arranged. A greatly appreciated activity 

in Stockholm is Kayaking, where employees have swiftly claimed the 

approximately dozen openings. Thomas Rabbing at Teracom Sweden’s facilities 

group is the driving force behind the activity. »For many years we 

have kayaked on Lake Mälaren one evening right before Midsummer. The 

weather gods have usually been with us, but obviously we’ve experienced 

strong winds, rain and thunderstorms. The accompanying leaders have 

taken good care of us. Some participants have taken a dip, both when 

going ashore and out on the open water. We'll see where we go in the 

summer of 2012, it isn’t written in stone.« 

35

Media plurality requires a 

long-term perspective 

HR2 

The Teracom Group’s customers expect well-functioning services, 

provided in equally well-functioning and reliable terrestrial 

networks. Regardless whether the customer is a broadcaster, 

program company or end user, they should be able to demand a 

long-term perspective in terms of both program selection and 

technical infrastructure. 

Supplier assessments 

The Teracom Group has an established and 

effective procedure for the assessment of 

suppliers. 

In 2011, Teracom Sweden evaluated 

95 of its suppliers (which corresponds with 

80 percent of Teracom Sweden's purchasing 

volume). Of the 95 suppliers, 81 responded 

and 69 were approved. 

Development of the terrestrial network – a sustainability issue 

As part of its customers' expectations and demands on the Group's business, 

Teracom Group needs to integrate sustainability aspects into its business processes; 

only then will the necessary controls be created to ensure that investments are made 

in the right areas, with high demands for quality and the lowest possible impact on 

the environment. The trust of the various stakeholders is the guarantee for a longterm 

distribution strategy based on a well-functioning terrestrial network, which 

in turn ensures secure transfer of social information as well as independant media. 

Investments and reinvestments 

A business based on a nationwide infrastructure must continuously invest in 

new technology that enables new products and services. This technology is an 

important requirement for long-term competitiveness. Investments in facilities, 

transmitting networks and technology systems are a major part of the Group’s 

assets, and part of this responsibility is therefore to nurture this infrastructure by 

implementing a long-term reinvestment plan. Consumer boxes and other receiving 

equipment also comprise an important component of the total investment that 

various stakeholders make in the terrestrial networks. Because many players share 

utilization of the infrastructure, the Teracom Group can achieve safe and costeffective 

distribution for an infinite number of receivers. 

Licensing 

By design, terrestrial networks are open to a variety of content producers and 

spectrum is assigned through national licensing rather than strictly commercial 

principles, which guarantees freedom of expression. The Teracom Group has a 

responsibility to monitor development in this area to best adapt new investments 

and reinvestments to the conditions that licensing creates. For the past few years, 

the Teracom Group has also actively participated in BNE, a European organization 

that aims to provide the terrestrial networks with the right competitive conditions 

in relation to other means of distribution. 

36

Customers 

The Teracom Group has extremely satisfied customers and to retain this position the 

Group’s customers must be able to count on availability and reliability throughout 

the chain, from customer service to broadcasting. For many years, customers have 

been actively involved in prevention and monitoring; for example, joint exercises 

are carried out with major customers, as are reviews of operations at regular intervals. 

Monitoring services are important components of customer agreements, as is 

regular reporting of availability and network capacity. Investments in robustness 

and contingency procedures are essential for customers’ confidence in the Group 

as a provider, whether with regard to Public Service or Pay-TV. 

Suppliers 

Long-term and sustainable financial development of the Group's operations 

requires suppliers to provide solutions that stand the test of time, both technically 

and financially. The purpose of the Group’s supplier assessments is to ensure 

that deliveries meet the highest standards of quality, environment, ethics and social 

responsibility. The Teracom Group expects suppliers to constantly improving the 

efficiency of products and services, both financially and from an energy perspective. 

The Kaknäs tower is a natural hub for 

Sweden's terrestrial radio and television 

broadcasts. The Group has a responsibilit y, 

both for its cultural value and to follow 

technological development, to care for 

the infrastructure through a long-term 

reinvestmen t plan. 

37

Reporting in accordance with GRI 

guidelines 

Below is an explanation of how the Sustainability Report, which is an integrated 

part of the Annual Report, was formulated and a description of its essential limitations. 

Work on and reporting of sustainability issues are closely integrated; therefore 

material information regarding the focus of sustainability initiatives is also 

described here. 

Correlation between key sustainability issues, stakeholders and indicators 

The Teracom Group has a long history as a safe, reliable and responsible partner 

and supplier of media services that benefit public welfare. During 2011, efforts 

have been made to work in a more structured way on sustainability issues that are 

important to the business and to the stakeholders who are affected by them. The 

Sustainability Report describes how efforts have progressed, along with presenting 

the goals that have been formulated within the Group. 

The Teracom Group applies the Global Reporting Initiatives (GRI G3) guidelines 

for its sustainability reporting. The report is for the 2011 financial year and is at 

the C+ level. The plus sign (+) indicates that the report was submitted for external 

review. The Assurance Report from the authorized auditing firm, PwC, is presented 

on page 91. Teracom's 2010 Sustainability Report was published at the same time 

as its Annual Report, in March 2011. The Sustainability Report will continue to be 

published once a year, integrated with the Group's Annual Report. 

Criteria for application levels 

Each of the criteria specified in the column for each level must be met to be classified as level C, C+, B, B+, A or A+. 

Presentation application level C C+ B B+ A A+ 

G3 Disclosures 

on profile 

INFORMATION 

Report on: 

1.1 

2.1 - 2.10 

3.1 - 3.8, 3.10 - 3.12 

4.1 - 4.4 , 4.14 - 4.15 

Report on all points 

for level C and: 

1.2 

3.9 - 3.13 

4.5 - 4.13, 4.16 - 4.17 

Same requirements as for 

level B 

Standard disclosures 

G3 Disclosures 

on management 

approach 

G3 Performance 

Indicators 

& sector 

performance indicators 

INFORMATION 

INFORMATION 

Not required 

Report on at least ten 

performance indicators, 

and at least one from 

each: social, economic and 

environmental impact 

Report certified by external party 

Disclosures on management approach 

for each indicator category 

Report on a minimum of 20 Performance 

Indicators, including at least one from 

each of: economic impact, environmental 

impact, human rights, labor relations and 

working conditions, role of the organization 

in society, product responsibility 


Disclosures on management 

approach for each 

indicator category 

Report on each core G3 indicator and 

sector supplement* indicator with due 

regard to the materiality principle by 

either: a) reporting on the indicator, 

or b) explaining the reason for its 

omission. 


*Sector supplement in final version 

38

An index of the profile information and performance indicators reported by 

Teracom in accordance with GRI G3 and their page references are provided on 

pages 40-41. A new indicator in this year’s report is LA1; the indicators LA10 and 

HR3 have been deleted. A description of how information was gathered is provided 

under each area and performance indicator. 

EN16 This symbol is used to designate reporting about a GRI performance 

indicator. It also shows which particular indicator is being referred to. 

More information about GRI, guidelines and indicators is available at 

www.global reporting.org. 

Limitations of the report 

This Sustainability Report pertains to all companies in the Teracom Group. In 2011 

the Group continued to develop through the formation of a new Parent Company. 

The Danish network operator, Teracom Denmark A/S, which was purchased in the 

autumn of 2010, is now included in the 2011 Sustainability Report. 

As part of the effort to focus on core business activities, the Group has decided 

to outsource the following services; therefore these activities are not included in 

the Sustainability Report: 

• Customer service for Pay-TV customers and private households 

• Salary administration 

• Office operations and cleaning 

• Administration of company cars 

• Logistics and warehouse management for Pay-TV operations 

We want to know what you 

think is important! 

We look forward to your questions and feedback 

about our sustainability work. Contact 

us by e-mail, hallbarhet@teracomgroup.se, 

or call Teracom Group Executive Vice President 

Gunilla Berg at +46 8 555 421 00. 

Read more about the Teracom Group’ 

sustainability efforts at http://www.teracomgroup.se/Hallbarhetsarbete/ 

39

GRI G3 Index 

Reference 

Comments 

1. STRATEGY AND ANALYSIS 

1.1 CEO on the importance of sustainability to the business and its strategies 

Pages 2-3, 4-5 

and 6-11. 

Fully reported. 

2. organization section 

2.1 Name of the organization Pages 44-45. Fully reported. 

2.2 Primary products, services and brands Pages 44-45. Fully reported. 

2.3 Organizational structure. Pages 44-45. Fully reported. 

2.4 Head office's location. Page 49. Fully reported. 

2.5 Countries where the organization has operations. Pages 44-45. Fully reported. 

2.6 Ownership Pages 44-45. Fully reported. 

2.7 

Markets in which the organization operates, including geographic distribution, 

sectors where it competes and type of customers. 

Pages 44-45. 


2.8 Size of the organization. Pages 44-45. Fully reported. 

2.9 Significant changes during the reporting period regarding size, structure or ownership. Pages 44-45. Fully reported. 

2.10 Awards received by the organization during the reporting period. 

No honors or awards 

were received during the 

period. 


3. report profile 

3.1 Reporting period Pages 44-45. Fully reported. 

3.2 Date of most recent report. Pages 38-39. Fully reported. 

3.3 Reporting cycle. Page 38. Fully reported. 

3.4 Person to contact for questions regarding the report and its content. Page 39. Fully reported. 

3.5 Process for creating the content of the report. Pages 30, 38-39. Fully reported. 

3.6 Scope of the report. Pages 30, 38-39. Fully reported. 

3.7 Special limitations in the report. Page 39. Fully reported. 

3.8 

Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations 

and other entities that can significantly affect comparability from 

period to period and/or between organizations. 

3.9 Basis and assumptions behind calculations. 

Page 39. 

Under each 

indicator 


Partially reported. 

3.10 Explanation and reasons for changes that have been made to prior information that was provided. 

Page 32. (Only changes 

in reporting of EN4, 

which now also 

includes energy use in 

premises) 


3.11 

Significant changes that have been made to scope, boundary or measurement methods 

since the last reporting period. 

Page 39. 


3.12 GRI index Pages 40-41. Fully reported. 

3.13 Policy and current practice with regard to seeking external assurance for the report. Pages 38 and 91. Fully reported. 

4. GOVERNANCE 

4.1 Governance structure of the organization. Page 50. Fully reported. 

4.2 Chairman of the Board's role(s) in the organization. Page 51. Fully reported. 

4.3 Number of independent, non-executive directors Page 57. Fully reported. 

4.4 

Mechanisms for shareholders and employees to provide recommendations or guidance to the Board or 

senior management team. 

Page 30. 


4.8 

Internally developed business concepts or statements on fundamental values, codes of conduct, and principles 

relevant to financial, environmental, and social performance and the status of their implementation. 

Pages 54-55. 


4.9 The Board's routines for evaluating the organization's sustainability efforts. Pages 54-55. Fully reported. 

4.14 The organization's stakeholders. Page 30. Fully reported. 

4.15 Method used for identifying stakeholders. Page 30. Fully reported. 

4.16 Types of dialogue with stakeholders. Page 30. Fully reported. 

40

5. PERFORMANCE INDICATORS 

EC1 

Direct economic value generated and distributed, including revenues, operating costs, 

employee compensation, donations and other community investments, retained earnings, and 

payments to capital providers and governments/authorities. 

Reference 

Reported below 

Comments 


EC1 

In 2011, the Group's profitability and financial position were strong and the equity ratio was 32 percent. 

The Group's economic value generation, by stakeholder 

* Income from customers SEK 4,059 (3,852) million 

* Costs for purchased goods and services SEK -2,671 (-2,648) million 

* Salaries and remunerations, employees SEK -556 (-543) million 

* Payments to capital providers SEK -428 (-22) million, 

to the owner 

SEK -110 (-110) million 

and to the minority 

SEK 0 (0) million 

* Taxes SEK -149 (-165) million 

* Total distributed value SEK -3,914 (- 3,488) million 

* Funds retained in the business SEK 145 (364) million 

EN3 

Direct energy consumption by main energy source and supplier. 

Reported below and 

on page 32. 


EN3 

The Group has consumed 25,338 (21,253) GJ through fuel use, of which 149 (581) GJ is energy from 

renewable energy sources. The increase can be attributed to the expansion of the Group with the 

network company in Denmark and an increase in the service business in Sweden. 

EN4 

Indirect energy consumption by main energy source and supplier. 

Presented below and 

on page 32. 

Reported. 

No efficiency losses 

when converting 

primary fuel to 

electricity 

EN4 

Indirect energy consumption for the Group was 500 (400) TJ. For the distribution between renewable and 

nonrenewable energy sources, please see page 32 

EN16 

EN16 

EN17 

EN17 

PR5 

PR5 

Total direct and indirect greenhouse gas emissions, in weight (CO 2 

equivalents). 

Direct and indirect energy consumption converted to carbon dioxide equivalents was 

15,340 (2,497) tons of CO 2 

equivalents. The large increase is primarily due to the addition of Teracom 

Denmark’s climate impact, and because their indirect energy is mainly produced by coal power. 

Other relevant indirect greenhouse gas emissions, in weight CO 2 

equivalents. 

Other emissions for the Group overall amounts to 1,536 (967) tons CO 2 

equivalents. Just as in 2010, this 

figure includes business travel, business travel, freight shipments and fuel production. The increase is due 

to the addition of emissions from Teracom Denmark. 

Procedures for achieving customer satisfaction, including results of customer satisfaction surveys. 

In order to have a sustainable organization in the long term, it is necessary for the Group to have loyal, 

satisfied customers who speak well of its products and services. Therefore, the Teracom Group's goal is to have 

the industry's (i.e. among end consumers and customers of network companies) most satisfied customers. It is 

important to have regular customer surveys in order to measure the level of customer satisfaction. 

Methodology: 

• Teracom Sweden, conduct an annual web-based survey, interviews with selected customers. In 2011, 

carried out January - February: 60 web surveys with 58 percent response rate and 26 in-depth interviews 

• Boxer Sweden and Teracom Denmark: www.kvalitetsindex.se 

• Boxer Denmark: www.wilke.dk 

• PlusTV: www.epsi-finland.org 


on page 32. 


on page 32. 

Reported below and on 

pages 18, 23 and 27. 




HR2 

Percentage of important suppliers and contractors that have been assessed on their respect for 

human rights and measure that have been taken. 

Pages 36-37. 


LA1 Total workforce by employment type, employment terms and region. Page 46. Fully reported. 

LA7 

Reporting on the level of injuries, work-related illnesses, sick days, absences and the total number of 

work-related deaths (listed for each region). 

Pages 47-48. 

Reported. Frequency, 

stated in million 

work hours. 

LA12 Percentage of employees that receive regular assessment of their performance and career development. Page 35. Fully reported. 

LA14 Basic salary and wage relationship between men and women, listed by employment category. Page 47. Fully reported. 

SO4 

SO4 

Measures taken due to incidents of corruption. 

No corruption cases 

were reported during the Fully reported. 

reporting period 

41

Contents 

44 Directors’ Report 

49 Corporate Governance Report 

56 Group Management 

57 Board of Directors 

58 Financial Overview of the Group 

59 Consolidated Income Statement 

59 Consolidated Statement of Comprehensive Income 

60 Consolidated Balance Sheet 

61 Consolidated Cash Flow Statement 

62 Consolidated Statement of Changes in Equity 

63 Parent Company Income Statement 

63 Parent Company Statement of Comprehensive Income 

64 Parent Company Balance Sheet 

65 Parent Company Cash Flow Statement 

66 Parent Company Statement of Changes in Equity 

67 Notes 

91 Audit Report for the Sustainability Report 

92 Audit Report 

96 Definitions 

42

Directors’ Report 

The Board of Directors and President/CEO of Teracom Group 

AB, CIN: 556842-4856, hereby submit the annual report for 

the Group and Parent Company for the 2011 financial year. 

Financial statements 

The following sections of the annual report are financial 

statements: the Directors’ Report, financial overview of the 

Group, consolidated comprehensive income, consolidated 

cash flows, consolidated financial position, changes in Group 

equity, Parent Company profit/loss, Parent Company financial 

positions, changes in Parent Company equity and notes. The 

Corporate Governance Report is also a part of the Directors’ 

Report. All of these parts have been audited by the auditors. 

The other parts of the annual report were reviewed on a 

general level by the auditors. 

Ownership and legal structure 

The Parent Company of the Group was previously Teracom 

AB, which consisted of Teracom Sweden’s operations and 

Group-wide functions. Swedish Parliament granted the 

Government the authority, at the Government's request, to 

change the Group structure. As a result of this decision, a 

new Parent Company, Teracom Group AB, was created on 1 

June 2011. The new Parent Company is a holding company, 

which has taken over the activities of the Group-wide functions 

from Teracom AB. With this structure in place, the legal 

structure now corresponds to the governance-related business 

structure. 

The shares in Teracom AB have been transferred via a 

shareholder contribution to Teracom Group AB. Afterwards, 

Teracom AB's subsidiaries were transferred to the new 

Parent Company in exchange for promissory notes. Carrying 

amounts were used when making the transactions. The new 

Group structure does not involve any change in the business 

focus as set out by Parliament. 

The Parent Company for the Group, Teracom Group AB, 

is a limited liability company that is wholly owned by the 

Swedish state and has its registered office in Stockholm, 

Sweden. During 2011, operations were conducted in Teracom 

Group AB, the subsidiaries Teracom AB, Boxer TV-Access AB, 

Teracom A/S, Boxer TV A/S and Digi TV Plus Oy. 

Operations and segments 

The Teracom Group monitors operations within five segments. 

Two segments, Teracom Sweden and Teracom Denmark, 

conduct network operations within terrestrial TV, radio and 

connections. Three segments, Boxer Sweden, Boxer Denmark 

and PlusTV, conduct pay TV operations within terrestrial TV. 

The geographic markets cover Sweden, Denmark and Finland. 

The segments reflect how the Group management team 

makes decisions regarding the allocation of resources and 

assesses performance based on operating profits. 

Boxer Sweden packages, markets and sells digital pay 

TV subscriptions in the digital terrestrial network. Its competitors 

are suppliers of cable TV, satellite operators and 

providers of TV via broadband. Boxer Sweden's customers 

are Swedish households. All competitors are developing 

new services, such as HDTV, On Demand services and even 

some 3DTV broadcasts. Play and 4G services are also exhibiting 

strong growth. Teracom Sweden owns and operates a 

broadcasting network for radio and TV that reaches nearly 

99.8 percent of all Swedish households. Teracom's nationwide 

network makes it possible to offer a number of integrated 

communication solutions. In Sweden, the market for 

TV and radio is regulated for public service broadcasting. In 

order to prepare for a decision by the Swedish Parliament 

on the digital transition of radio, Teracom is conducting test 

broadcasts in cooperation with the major radio companies. 

Teracom Sweden's major customers are Boxer Sweden, 

Sveriges Television, Sveriges Radio and TV4. 

Boxer Denmark runs pay TV activities in the Danish 

digital terrestrial network. The business model is the same 

as for Boxer Sweden – to package, market, sell and administer 

program channels broadcast in the terrestrial network. 

The customers are Danish households. There is also intense 

competition in Denmark's pay TV market. Most competitors 

are offering triple play and HDTV. Teracom Denmark 

owns and operates the broadcasting network for radio and 

TV that reaches nearly 99 percent of all Danish households. 

Customers include Boxer Denmark, Danmarks Radio and 

Denmark's largest channel, TV2. Intense preparations have 

been underway for the conversion of TV2 from free TV to pay 

TV in January 2012. 

Plus TV is the leading pay TV operator in Finland. Like 

Boxer, Plus TV packages, markets, sells and administers PlusTV 

program channels that are licensed to broadcast pay TV in 

the terrestrial network. The customers are Finnish households. 

In Finland, terrestrial TV is strong. The majority of TV 

reception is free TV and there is a wide variety of channels. 

The demand for pay TV is partially seasonal and driven by 

various sporting events. During the period, the competition 

for pay TV customers increased when the terrestrial network 

operator, Digita, which is owned by TDF, started up pay TV 

operations under the name, TV Viihde. 

Earnings trend 

Group income for full-year 2011 amounted to SEK 4,059 

(3,852) million, an improvement of 5 percent. Boxer Denmark 

increased its income by 68 percent compared to last year 

due to a sharp increase in the number of subscribers. For 

Boxer Sweden, there was a negative impact on accumulated 

income of slightly more than SEK 50 million due to a transition 

from semi-annual billing to monthly billing of card fees. 

Revenue recognition was also modified in conjunction with 

this transition, which is only an effect in the distribution of 

revenue over a period of time. 

44

Operating profit for the year amounted to SEK 376 (293) 

million, an increase of 28 percent compared to 2010. There 

was a negative impact on profit from costs affecting comparability 

totaling SEK 36 (47) million. This amount consisted of 

restructuring costs of SEK 17 million as well as impairment 

losses on property, plant and equipment of SEK 19 million, 

which were an adjustment resulting from technological 

development. Comparative costs from last year consisted of 

restructuring costs of SEK 23 million and impairment losses 

on property, plant and equipment and inventories of SEK 24 

million. Boxer Sweden's profit was affected negatively by the 

above-mentioned SEK 50 million. Translation of the subsidiaries' 

losses in Finland and Denmark resulted in a positive 

impact on profits of slightly more than SEK 19 million 

compared to last year. 

Profit after financial items was SEK 325 (281) million. 

Net financial expense for the year was SEK -51 (-12) million. 

Interest expenses increased by approximately SEK 35 million 

compared to full year 2010 due to higher loan levels during 

the year as a result of the acquisition of Teracom Denmark 

(BSD). This year the Group began to apply hedge accounting 

to unrealized gains related to electricity derivatives, which 

were reported directly in comprehensive income. Unrealized 

gains (losses) related to electricity derivatives positively 

impacted last year's net financial income/expense by SEK 14 

million since hedge accounting was not applied. 

Net profit for the period was SEK 168 (201) million. 

Based on the company management team's current assessment 

of future profits, a deferred tax asset of SEK 9 million 

was reported for the year's deficit in Finland. A deferred tax 

asset of SEK 25 million was reported for the year's deficit in 

the Swedish Parent Company, Teracom Group AB. Last year a 

deferred tax asset of SEK 105 million was capitalized based 

on a valuation of the deficits in the Danish operations. 

Parent Company earnings 

Parent Company income for 2011 amounted to SEK 33 (-) 

million. Operating profit for the year was SEK -37 (-) million. 

The Parent Company received dividends from subsidiaries 

totaling SEK 297 (-) million and profit after financial items 

was SEK 201 (-) million. Net profit for the period was SEK 

226 (-) million. Based on the management's assessment, a 

deferred tax asset of SEK 25 (-) million was capitalized during 

the year. 

Financial position 

Group interest-bearing liabilities amounted at year-end to 

SEK 2,016 (2,381) million. During 2011, the amortization of 

credit facilities amounted to SEK 375 million. The net debt/ 

equity ratio was 0.98 (1.12). Total assets decreased by SEK 

145 million to SEK 5,553 (5,698) million. The Group's equity 

ratio was 32 (31) percent, which represents an increase of 

one percentage point compared to the same time last year. 

Significant events January – December 2011 

• Teracom Sweden offered program companies the option 

of purchasing broadcasting of commercials or programs in 

up to 30 different regions. During the period, new agreements 

were signed with several major program companies. 

• On June 1 Teracom Group AB was formed as the Parent 

Company for the Group, which created a transparent legal 

structure corresponding to the business structure. 

• Andrea Gisle Joosen began working on August 8 as the 

new President of Boxer TV Access AB (Boxer Sweden). Most 

recently, she held the position of President of Panasonic 

Nordic. 

• Steffen Weber was named in November Acting President 

of Teracom A/S (Teracom Denmark). He is replacing Finn 

Søndergaard, who is moving to the Group Strategy & 

Business Development Department as a step toward retirement. 

Significant events after the end of the period 

• Sales of Boxer On Demand, which was launched on 

Novembe r 7, 2011, were temporarily halted on January 2. 

• On January 11, Danish TV 2 went from MPEG2 to MPEG4 

and in conjunction with this joined Boxer's pay TV 

channe l selection, which has greatly contributed to Boxer 

Denmark' s strong growth. 

• Boxer Denmark reached 300,000 pay TV customers on 

Februar y 5, 2012. 

• When the Parent Company acquired Digi TV Plus Oy in 

2009, it issued two put options for the remaining 49 percent 

of shares in the Finnish subsidiary. The put options 

were reported as a liability. At the beginning of 2012, the 

owner of one of the put options utilized the right to sell 

shares worth the equivalent of approximately 18 percent 

to the Parent Company. The purchase was completed at a 

price corresponding to the amount reported as a liability 

at the end of the financial year. One put option, and therefore 

a liability, for approximately 31 percent of the shares 

in Digi TV Plus Oy remain. 

Risks and risk management 

Executive management has primary responsibility for 

managing the Group's risk. In general, there are three types 

of risks. Business risks are normally managed by the operational 

units in the Group, financial risks by the Group's central 

finance department and regulatory risks by the central function, 

Regulatory and Public Affairs. Group management 

manages the risks in a structured, proactive manner with the 

aid of a clearly documented control model, decision-making 

processes and Group policies. 

Business and operational risks 

The most important business risk is the tough competition 

on all markets, which means that the terrestrial network 

could have a lower market share if more and more customers 

switch to other digital TV platforms such as satellite, cable 

TV and TV via broadband. The pay TV companies are therefore 

focusing on providing an attractive offer to the large 

45

customer base the Group has in the Nordic countries. In 

addition, prices in negotiations with the program companies 

must be competitive. 

The Group's network activities place high demands on 

reliability of service - not just under normal conditions, but 

also under different types of pressures and extraordinary 

circumstances. Risk analyses are performed in the line organization 

in order to maintain the proper level of security 

and stable operations. Work related to information safety is 

based on the international information safety standard, ISO/ 

IEC 27001, and training exercises are conducted regularly in 

cooperation with customers and authorities in order to create 

and maintain the required skills for managing different types 

of incidents and crises. 

Regulatory risks 

The Group's business is affected by government decisions 

and legislation, primarily on media and electronic communications. 

Examples of important issues are: frequency use, 

the design of licenses and permits for the Group's customers 

in the terrestrial network, rights, and the regulation of prices 

and access through SMP (Single Market Providers) decisions 

pertaining to networks and other infrastructures. The Group 

is actively working with regulatory issues via its contacts 

with government authorities and politicians in Sweden, 

Finland and Denmark. The Group also actively participates in 

several European forums in order to monitor and influence 

these issues. 

Financial risks 

Teracom Group AB is exposed to various types of financial 

risks, the most significant of which are financing risk, interest 

rate risk, currency risk and credit risk. These risks are dealt 

with in accordance with the finance policy established by 

the Board of Directors, which is characterized by the desire 

to maintain a low level of risk. The overriding principle is 

to minimize all factors that could have a negative impact 

on earnings and cash flow due to short-term fluctuations 

in financial markets. Within the given limits, the company 

strives to achieve optimal net financial income. More information 

about financial instruments and financial risk 

management is available in note 21 on pages 84-87. 

Environmental impact of operations 

The Group's environmental policy is based on the Group's 

desire to take responsibility for its environmental impact by 

working on prioritized environmental issues. A clear environmental 

awareness strengthens competitiveness in interactions 

with customers, cooperation partners and in the 

Group's role as an employer. 

The Group's largest impact on the environment is from 

fuel and energy consumption, a measure of which is its 

greenhouse gas emissions. The Group's overall climate 

impact has been documented and the Group has established 

the goal of decreasing its negative impact on the environment 

each year. All of the operations should prepare plans 

and activities for how to reduce their environmental income. 

In 2011, Teracom Sweden received an environmental 

sanction from Nacka Municipality due to a delayed refrigerant 

report. The routines for submitting the report are now 

revised with the responsible supplier. 

Employees 

The right development of skills contributes to ensuring the 

company's competitiveness and the development of individuals. 

It is therefore the responsibility of every Group company 

and every manager to together with the employees regularly 

evaluate completed skills development activities and plan for 

future needs. The Group also works to pursue goal-oriented 

efforts at all levels of its companies. This involves continual 

follow-up and feedback on performance compared to the 

established goals and goals pertaining to skill development. 

Follow-up is conducted via regular employee reviews. 

The following table shows the entire staff broken 

down by the offered type and form of employment for the 

companies included in the Group. 

LA1 

Unit Total personnel Permanent full-time Permanent part-time 

Temporary 

employment 

Hired consultants, 

recalculated to fulltime 

equivalents* 

Teracom Group Total 740 698 1 41 6,9 

Teracom AB 475 445 0 30 3,7 

Boxer TV-Access AB 62 53 0 9 0,6 

Teracom Group AB 73 72 0 1 1,1 

Teracom A/S 66 65 1 0 1,5 

Boxer TV A/S 33 33 0 0 0 

Digi TV Plus OY 31 30 0 1 0 

* A hired resource is calculated to correspond to 1,800 working hours per year for a full-time position and refers to the entire accounting period. 

46

Diversity and equal opportunity 

Diversity is a success factor because it enables the Group 

to get the most out of each person's specific expertise and 

development potential. Differences in background and experiences 

provide an opportunity for both the company and 

its employees to develop, which contributes to a dynamic, 

creative and pleasant work conditions. Long-term as well, 

the Group must be able to attract applicants, regardless of 

gender, age, ethnic background, beliefs, functional disabilities, 

appearance, sexual preferences or any other factor. At 

the end of 2009, the Group adopted a diversity and equality 

policy. 

Important areas in the diversity and equal opportunity 

policy include recruitment, work conditions, harassment and 

discrimination, parenting, how salaries are determined and 

a follow-up on equal opportunity. In preparation for salary 

reviews, the Group regularly documents the salary differences 

between women and med with equivalent positions. 

Gender comparisons of basic salaries at different levels 

in all of the Group's companies are presented below. The 

results are based on the number of permanent employees. In 

other words, results do not include any employees who have 

been released from duty as part of an employment termination 

agreement. Each company's President is included in the 

numbers for Teracom Group AB/Group management. 

LA14 

Company/category Number of men Number of women 

Relative salary level 

between women and men 

in percent * 

Teracom Group AB/Group management 8 4 107 

Teracom Group AB/managers 3 5 79 

Teracom Group AB/other employees 21 38 73 

Teracom AB/managers 28 8 90 

Teracom AB/other employees 354 55 104 

Boxer TV-Access AB/managers 8 5 121 

Boxer TV-Access AB/other employees 23 22 115 

Teracom A/S/managers 6 2 73 

Teracom A/S/other employees 48 9 102 

Boxer TV A/S/managers 7 2 69 

Boxer TV A/S/other employees 14 10 102 

Digi TV Plus OY/managers 3 3 81 

Digi TV Plus OY/other employees 10 15 83 

* A figure below 100 percent means that men have a higher average salary than women 

Work environment, safety and sick leave 

The following are examples of how the Group fulfills its work 

environment responsibilities: 

• Training courses in work environment for managers, rescuing 

injured individuals from masts, mast elevator and 

skylift operation, working at heights and driving cars safely 

using eco-driving. 

• Regular health evaluations for employees. 

• Requiring health evaluations for employees working in 

masts, which complies with the regulations issued by the 

Swedish Work Environment Authority. 

The Group's fitness program offers a personal fitness 

subsidy and various activities provided by the local fitness 

groups. In Denmark, the taxation rules do not allow a 

personal fitness subsidy. Therefore, only group fitness activities 

are offered to employees in that country. 

In 2011, there were two work environment incidents at 

Teracom AB that were reported to the Swedish Work Environment 

Authority. While dismantling old broadcast masts at 

Hörby AM station, an employee passed away while up in the 

mast. A medical investigation indicated that the death was 

the result of an acute illness and the matter is no longer classified 

as an accident. The investigation provided new information 

about the method for how injured individuals are 

rescued from masts and as a result the rescue equipment has 

been modified. 

One employee was involved in a car accident that could 

have caused considerable harm. The employee needed to take 

an extended period of sick leave, but the injuries will most 

likely not cause any long-term effects. 

LA7 

Company/category 

Total sick leave, percent 

Group total 2,0 

Teracom Group AB 2,4 

Teracom AB 2,0 

Boxer TV-Access AB 1,1 

Teracom A/S 2,7 

Boxer TV A/S 1,3 

Digi TV Plus OY 1,4 

47

Accident frequency Teracom AB and Teracom Group AB 2011 

Accidents not 

resulting in 

absence 

Accidents 

resulting in 

absence 

>1 day 

Reported 

work-related 

illness 

Lost work 

days due to 

accident/ 

million work 

hours 

Accidents 

resulting in 

absence > 

1 day/million 

work hours 

Year 

Nearaccidents 

Travel 

accidents 

2011 25 0 3 2 0 87* 1,8 1,135 

2010 10 4 4 1 0 82* 0,9 1,094 

Million work 

hours 

* One serious accident in 2010 and one in 2011 resulted in 90 lost work days. Other companies in the Group have no work-related incidents to report. 

Remuneration levels for senior management 

Teracom AB's Board of Directors is responsible for appointing 

the company's President and CEO along with establishing 

the terms of employment. The Board applies the guidelines 

established by the Government, Guidelines for the employment 

terms of senior executive in companies that are stateowned. 

Details about remuneration to the Board of Directors, 

President/CEO and other senior executives are available in 

note 6 on pages 74-75. 

Future prospects 

The pay TV operations are relatively less sensitive to business 

cycle fluctuations than the other areas, but the importance 

of value-for-money increases during period of financial 

uncertainty. The competition on all of the pay TV markets 

in which the Group is active will continue to be intense. 

The network operations are by nature more stable and have 

external contracts primarily within public service and services 

to major players on the telecom market. 

Owner requirements and dividends 

The owner has established a requirement for the Group's 

equity ratio and a long-term goal for return on equity. The 

equity ratio should be at least 30 percent and the goal for 

return on equity is 17 percent. At the end of 2011, the equity 

ratio was 32 (31) percent and return on equity for the year 

was 10 (12) percent. The Group's goal is to distribute as 

dividends 40-60 percent of net profit for the year provided 

that the goal of an equity ratio equal to 30 percent has been 

achieved. 

Proposed appropriation of profits 

Non-restricted equity in the Parent 

Company 

Profit brought forward 

Profit (loss) for the year 

Total non-restricted equity 

1,633,000,000 SEK 

226,129,759 SEK 

1,859,129,759 SEK 

The Board of Directors' statement on value transfer 

according to Chapter 18 Section 4 of the Swedish 

Companies Act 

The Board suggested to the 2012 AGM that it decide on 

total dividends of SEK 110 million for the 2011 financial year. 

The distribution totals 65 percent of the Group's net profit. 

In light of the proposal, the Board of Directors may hereby 

make the following statement in accordance with Chapter 

18, section 4 of the Companies Act. 

The Board of Directors finds that the company's restricted 

equity will still be fully covered following the proposed 

dividends. The Group is reporting equity of SEK 1,773 million, 

of which SEK 217 million consists of earned profits after the 

transactions with shareholders for the year as a result of the 

formation of a new Group structure. The equity ratio for the 

Group was 32 (31) percent and for the Parent Company 31 (-) 

percent. It is the opinion of the Board of Directors that the 

company's and the Group's equity will be sufficient following 

the proposed proposition given the nature, scope and risks of 

the operations. The Board has taken into consideration the 

company's and the Group's historical and budgeted development 

and the state of the economy. 

Even after the proposed distribution of profits, the 

company's and the Group's equity ratio is judged to be satisfactory. 

The dividends payment will not affect the company's 

or the Group's ability to fulfill its payment obligations. It is 

the opinion of the Board that the company and the Group 

are well prepared to handle both changes to liquidity and 

unexpected events. 

Having considered this and all of the information 

presented in the annual report, it is the Board's opinion that 

its proposed dividend is justifiable. This applies not only to 

the Parent Company but also the Group as regards the equity 

requirements that are based upon the type, size and associated 

risks of the business as well as consolidation and investment 

needs, liquidity and overall financial position, as stated 

in the Swedish Companies Act, ABL chapter 17, paragraph 3 

(Prudence Rule). 

The Board of Directors suggests the following appropriation of profits: 

Dividends 

110,000,000 SEK 

Carried forward 

1,749,129,759 SEK 

Total 

1,859,129,759 SEK 

48

Corporate Governance Report 

The Corporate Governance Report has been examined by 

the Group's auditors and is part of the Directors' Report. 

The report describes how the company is governed, how the 

work of the Board of Directors is designed, how the company 

conducts its business and how the operations are followed up 

in relation to established goals. The report includes a description 

of the internal control with regard to financial reporting. 

Teracom Group AB's owner and goals 

The Swedish Government is the sole owner of Teracom Group 

AB, a Swedish limited liability company with its registered 

office in Stockholm. 

The catchwords for the Government's administration of 

wholly owned companies are openness, active ownership, 

order and clarity. The Government Ownership Policy states 

that state-owned companies must take responsibility for 

issues relating to ethics, the environment, human rights, 

equality and diversity. The owner thus requires a well 

thought-out strategy for these issues. 

The business objective of Teracom Group AB is to indirectly 

offer network solutions for the distribution of radio 

and TV and any other activities relating thereto. Based on this 

objective and within the framework of the regulatory requirements, 

the company must always act in a businesslike manner. 

The ownership directive lays down the Group's financial 

goals and dividends policy as: 

• Return on equity should be calculated as the profit after 

net financial items (taxed at the standard rate) divided by 

average adjusted equity. The goal is to obtain a long-term 

return on equity of 17 percent. 

• Equity ratio of 30 percent. 

• Between 40 and 60 percent of net profits should be distributed 

as dividends, provided that the goal for equity 

ratio has been achieved. 

Framework and governance structure within Teracom Group 

Management of Teracom Group AB is based on the Companies 

Act (ABL, in Swedish) and the Government Ownership Policy. 

The Government's Ownership Policy in turn contains references 

to the Swedish Code of Corporate Governance, hereafter 

referred to as "the Code". 

At the Annual General Meeting, the owner decides on the 

company's Articles of Association, appoints the company's 

Board of Directors and provides directives regarding the 

Group's financial goals and dividends policy. 

The Board of Directors is responsible for ensuring that 

the Group's companies are well organized and carries the 

ultimate responsibility for the management of the companies' 

operations. The work of the Board of Directors is governed by 

a Rules of Procedure, which is adopted by the Board at least 

once a year. The Rules of Procedure also regulates the relationship 

between the Board of Directors and the President/ 

CEO, as well as the President/CEO's authorities. Read more 

about the Annual General Meeting and the work of the Board 

of Directors on pages 50-52. 

The Board of Directors also decides on important internal 

governance documents for the Group, for example the 

strategic plan and some Group policies. 

At the end of 2011, the Group consisted of the Parent 

Company, Teracom Group AB, and the operating subsidiaries, 

Teracom AB and Boxer TV-Access AB in Sweden, Teracom A/S 

and Boxer TV A/S in Denmark and Digi TV Plus Oy in Finland. 

The diagram on page 50 provides an overview of the Group's 

governance structure. 

Deviations from the Code 

According to the Government Ownership Policy, the Code 

shall be applied in all state-owned companies. The purpose of 

the Code is to contribute to improved governance of Swedish 

limited liability companies and address the decision-making 

systems through which the owners directly or indirectly 

control the company. 

The rules pertain to an individual company's organization 

and working methods, along with the interaction between 

the two. The Code should be applied in accordance with the 

"comply or explain" principle. For certain issues, in accordance 

with the Code's "comply or explain" principle, the Government 

has found cause to justify deviations from the Code. 

A summary of the Government's reasons for its deviations 

from the Code is presented below. 

Teracom Group AB deviates from the Code on the 

following items: 

Rule 2 on the selection of and remuneration to the Board 

and auditors 

The provisions of the Code are primarily intended for public 

companies with widespread ownership. Teracom Group 

deviates from these rules because the nomination process 

follows the Government Ownership Policy. According to the 

Government Ownership Policy, the owners, via the Ministry 

of Finance, nominate the members of the Board of Directors 

and the auditors. For the 100 percent state-owned companies, 

there are uniform and common principles for a structured 

nomination process, which is run and coordinated by 

the Ministry. 

Rule 4.4 on the independence of the Board of Directors 

According to rule 4.4, the majority of Board members must 

be independent in relation to the owners. Teracom Group 

deviates from this rule because, for companies that are 100 

percent state-owned, there is no reason to report on independence. 

The Government Ownership Policy stipulates 

that nominations of Board members are to be made public, 

in accordance with the guidelines of the Code. However, 

an exception is made for reporting members' independence 

in relation to major owners. The Code rule stipulates that 

companies must have at least two Board members who are 

independent of major owners. It also stipulates that the 

independence of all Board members to major owners must 

be reported. The purpose of this rule is to protect minority 

owners' interest in companies where there is widespread 

ownership. 

49

Governance structure 

The Government 

The Government Ownership 

Policy 

Nomination process 

The Government Ownership 

Policy 

Annual General Meeting 

Articles of Association 

External audit 

Audit plan 

Teracom Group AB 


Rules of Procedure 

Audit committee 

Remuneration committee 

Internal audit 

Internal audit plan 

President/CEO 

Directive for the President/CEO 

Teracom AB Teracom A/S Boxer TV-Access AB Boxer TV A/S Digi TV Plus OY 

Rule 6.1 on the Chairman of the Board 

The Code addresses the special role of the Chairman of the 

Board. The Chairman of the Board in the Teracom Group AB is 

appointed by the Annual General Meeting. If the Chairman steps 

down during the term of office, the owner must immediately 

appoint a new Chairman at an extraordinary general meeting of 

shareholders. This is a deviation from the Code, which instead 

stipulates that the Board may appoint its new Chairman. 

Rules 6.3 and 8.2 on evaluation of the Board of Directors and 

the President/CEO 

The work performed by the Board of Directors must be evaluated 

each year. The Code stipulates that the Chairman of the Board is 

responsible for ensuring that the Board's work is evaluated and 

that the nomination committee is informed of the results of the 

evaluation. For companies that are wholly owned by the state, 

the Swedish Government Offices, rather than the nomination 

committee, must be informed of the evaluation results. 

Teracom Group's Annual General Meeting 

The Annual General Meeting (AGM) is Teracom Group AB's 

highest decision-making body. It is the forum through which 

the Government, in its role as shareholder, formally exercises 

its control. The AGM appoints the Board of Directors 

and auditors. It also makes decisions concerning such things 

as changes to the articles of association and adopting the 

balance sheet and income statement. 

Teracom Group AB's AGM is held in Stockholm, where the 

company's registered office is currently located. Notice of the 

AGM and any extraordinary general meetings of shareholders, 

where issues pertaining to a change to the articles of 

association will be discussed, must be given no earlier than 

six weeks and no later than four weeks prior to the meeting. 

Notice of any other extraordinary general meetings of shareholders 

must be given no earlier than six weeks and no later 

than two weeks prior to the meeting. In addition to the rules 

contained in the Swedish Companies Act and the Code, the 

following principles apply to the shareholder meetings of 

state-owned companies. Notice of the time and location 

of the AGM must be sent to the Swedish Parliament (Riksdagens 

Centralkansli) simultaneous to issuing such notice to 

shareholders. Members of Parliament who wish to attend the 

AGM must notify the Board in advance. Such notice should 

be submitted at least one week prior to the AGM. 

The public should be invited to attend the AGMs of stateowned 

companies. For state-owned companies, arrangements 

should be made in conjunction with the AGM for allowing 

the public to present questions to the Board of Directors and 

management team. State-owned companies must hold their 

AGM before April 30 and any distribution of dividends must 

take place no later than two weeks after the AGM. 

Extraordinary General Meeting of Shareholders, Number 1, 2011 

Teracom Group AB held an extra general meeting of shareholders 

on March 22, 2011 as a step in the process of forming 

a new Parent Company in the Group. At the meeting, the 

following Board members were elected: Åsa Sundberg, Tobias 

Henmark, Ingrid Engström, Lars Grönberg, Kristina Axberg- 

Bohman, Urban Lindskog, Maria Curman and Nils Petter Tetlie. 

Åsa Sundberg was elected Chairman of the Board. 

The above list of members were at the same time elected 

to the Board of Directors of Teracom AB. 

PriceWaterhouseCoopers AB was appointed auditor for 

the period of time until the next AGM. 

Extraordinary General Meeting of Shareholders, Number 2, 2011 

Teracom Group AB also held an extra general meeting of 

shareholders on June 1, 2011. The meeting elected Johan 

Hallberg as a new Board member to replace Tobias Henmark 

and announced employee representatives John-Olof 

Blomkvist, ST, with Stig-Arne Celin as deputy, and Magnus 

Ahxner, Akademikerna, with Niklas Hanson as deputy. 

The AGM-appointed Board members and employee representatives 

are presented on pages 56-57. On the same day, 

Teracom Group AB formally became the Parent Company 

in the Group as the Government transferring the shares in 

Teracom AB to Teracom Group AB. 

2012 AGM 

The 2012 AGM will be held in Stockholm on April 18. 

50

Teracom AB's 2011 AGM 

Teracom AB's AGM was held on April 14, 2011. At the AGM, 

the auditor from PriceWaterhouseCoopers AB delivered the 

auditor's report to the owner, which then discharged the 

Board of Directors from liability. The AGM adopted the annual 

report for the 2010 financial year and decided, in accordance 

with the Board's proposal, to distribute SEK 110 million as 

dividends to the owner. The AGM approved the proposal that 

was presented on remuneration and other employment terms 

and conditions for senior executives. The minutes from the 

general meetings of shareholders, with information about all 

decisions, are available at www.teracom.se. 

Composition of the Board of Directors 

According to the Government Ownership Policy, each nomination 

of a Board member shall be based on the competence need 

of the company’s Board of Directors. The Government's goal 

is that the Board shall have a high level of expertise, which is 

well adapted to the company's business, situation and future 

challenges. Board members are expected to have a high level 

of integrity and exercise good judgment, as demanded of 

state representatives. Each Board member must be capable of 

making an independent assessment of the company's operations. 

The composition of the Board should also be such that 

there is balance between the number of men and women (at 

least 40 percent representation for each gender). The percentage 

of members elected by the AGM who are male is 50 (43) percent 

for Teracom Group AB's Board of Directors. The average age 

of Board members is 50 (53) years. The owner's assessment is 

that, on the whole, the Board of Directors meets or exceeds the 

requirements stated in the Government Ownership Policy. 

Responsibility of the Board of Directors 

The Board has the ultimate responsibility for the organization 

and management of the Group's affairs. The Board is responsible 

for ensuring that ccompany’s reporting to its owner and 

the public provides a true and complete picture of the Group's 

development, financial position and risks. Furthermore, the 

Board is responsible for making sure that financial statements 

are prepared in accordance with applicable laws and generally 

accepted accounting principles. It must also ensure that the 

Group complies with the recommendations set out in the OMX 

Nordic Exchange Stockholm listing agreement. The Board must 

reconcile with the owner on issues of significant importance, 

such as the capital structure and long-term financing issues, 

changes in strategy and acquisitions, mergers or divestitures. 

The Board's Rules of Procedure, which the Board adopts 

annually, contains, in addition to rules for the work of the 

Board and the division of responsibility between the Board 

of Directors and the President/CEO, instructions regarding 

financial reporting that complement the provisions set out in 

the Companies Act and the Code. 

The Chairman of the Board has special responsibility for 

leading the work done by the Board and making sure that 

it carries out all of its assigned duties. Among other things, 

the Chairman is responsible for making sure that every new 

Board member receives appropriate introductory training 

and that the Board regularly updates and deepens its 

knowledge of the Group. The Chairman is also responsible for 

the company's contacts with the owner and for relaying the 

owner's views on ownership issues to the rest of the Board. 

The duties of the Board of Directors 

There were 10 Board meetings held in 2011 in the Group's 

Parent Company, up until June 1 Teracom AB and thereafter 

Teracom Group AB. Essentially, the work done by the Board 

followed the adopted plan, which consisted of standing information 

and decision items as well as special issues that must 

be approved by the Board each year. Each meeting followed 

an approved agenda and the underlying documentation was 

distributed to the Board prior to the meeting or made available 

on the Board's website. The company's auditors who 

were elected at the AGM participated in a Board meeting 

that was not attended by the company's management team. 

At the meeting of the Board of Directors on March 16, 2011, 

Teracom AB's auditor presented the findings from the audit 

of the 2010 financial statements. The President/CEO and 

Executive Vice President/CFO attended each Board meeting. 

Representatives from the Group's senior management team 

were invited to present certain issues. Standing items that 

were covered at Board meetings included the President/CEO's 

report and monthly financial reporting. Additionally, the 

Board addressed several other issues at the meetings held in 

2011. Particular attention was given to the following items: 

• Strategic plan 

• Budget 

• Development in Boxer TV A/S and Digi TV Plus Oy 

• The Group's organizational structure 

• Reports from the audit committee on such items as internal 

control and audits 

• Corporate governance issues and Group-wide policies 

• Annual and interim financial statements 

Name Function in the Group Board of Directors Number of Board meetings Audit committee 

Remuneration 

committee 

Åsa Sundberg Chairman of the Board 10/10 2/2 

Kristina Axberg Bohman Board Member 10/10 7/7 

Maria Curman Board Member 8/10 2/2 

Ingrid Engström Board Member 10/10 2/2 

Lars Grönberg Board Member 10/10 7/7 

Johan Hallberg Board Member 6/6 2/2 

Urban Lindskog Board Member 9/10 6/7 

Nils Petter Tetlie Board Member 5/8 

Tobias Henmark Board Member 4/4 

John-Olof Blomkvist Board Member 7/10 

Magnus Ahxner Board Member 9/9 

Claes-Göran Persson Board Member 1/2 

Stig-Arne Celin Board Member 2/2 

51

Remuneration 

The Chairman of the Board and all Board members are paid for 

their efforts and the responsibility that their assignment entails 

in accordance with the decisions taken at the AGM. Members 

also receive payment for their work in committees. The Board 

of Directors decides on remuneration to the President/CEO and 

Executive Vice President/CFO based on preparatory work by the 

remuneration committee. When deciding on the remuneration 

and other employment terms and conditions for senior 

executives, decisions are based on the guidelines set out the 

remuneration policy, which are established by the owner at the 

AGM. For more information on remuneration, please see note 6 

on pages 74-75 of the annual report. 

Audit committee 

Each year, the Board appoints an audit committee to obtain 

more in-depth knowledge on, and to be able to work more efficiently 

on, matters relating to risk assessment, internal control, 

external reporting and auditing. The audit committee is a preparatory 

body, whose proposals are passed on to the Board, i.e. the 

committee is not authorized to make decisions. The committee's 

work is regulated by the Board's Rules of Procedure. 

The committee's tasks also include monitoring auditor 

impartiality and independence by supervising the independent 

audit tasks that auditors may be given by the company's 

management team. The audit committee also assists the 

Board of Directors in assuring the quality of financial 

reporting. Following the Board meeting in March 2011, the 

audit committee consisted of three members: Chairman 

Kristina Axberg Bohman, Lars Grönberg and Urban Lindskog. 

The Executive Vice President/CFO, group reporting 

manager and auditors attended each meeting. However, the 

auditors were not present at the meeting to evaluate their 

work. Company officers from the Group were invited to 

present certain issues. The audit committee always submitted 

information about its meetings at the next scheduled Board 

meeting. The minutes from each meeting of the audit 

committee were sent to each of the Board members or made 

available on the Board's website. 

During the 2011 financial year, the committee held 

seven meetings and particular attention was devoted to the 

following items: 

• 2011 interim reports and the 2010 annual report 

• Risk assessments 

• Critical accounting issues 

• Evaluation of the internal controls 

• Evaluation of the work done by auditors 

• Governing policies for Board decisions 

• Internal audit 

• Planning of the audit 

Remuneration committee 

The remuneration committee is a preparatory body that 

submits its recommendations to the Board of Directors and 

thus is not authorized to make decisions. The remuneration 

committee is responsible for reviewing and providing 

recommendations to the Board on remuneration principles 

and pension terms for the company's senior executives in 

accordance with the Group's policies. It is also responsible for 

reviewing and providing recommendations on the President/ 

CEO's terms of employment, remuneration and other benefits 

prior to a decision on such matters by the Board of Directors. 

The remuneration committee held two meetings during the 

2011 financial year. The committee consists of four members 

appointed by the Board, specifically Åsa Sundberg (Chairman), 

Maria Curman, Ingrid Engström and Johan Hallberg. 

Responsibilities of the President/CEO and cooperation with 

the Board 

The Board of Directors appoints the Group's President/CEO, 

a position which has been held by Crister Fritzson since 

2008. Gunilla Berg was elected Executive Vice President/ 

CFO at the Board meeting in November 2010. According 

to the Companies Act and the Board of Directors' Rules of 

Procedure, the President/CEO is responsible for the ongoing 

administration of the Group's business activities. The Board's 

directive for the President/CEO provides detailed information 

on the President/CEO's authority and obligations. 

Cooperation and exchange of information between the 

President/CEO and the Chairman of the Board occurs at 

regularly scheduled meetings. Among other things, these 

meetings are used to plan upcoming Board meetings. The 

President/CEO provides the Board with monthly reports that 

help facilitate the Board's ability to continuously monitor the 

Group's financial position. 

Management structure and organization 

Teracom Group's management team meets every other week 

in order to discuss issues relevant to the Group as a whole, 

such as allocation of resources, financial developments, 

budgets/forecasts, ongoing decisions pertaining to business 

operations, governance, risk management, sustainability 

issues and issues before the Board. 

During 2011, the Group management team consisted 

of Crister Fritzson, President and CEO of Teracom Group 

AB, Gunilla Berg, Executive Vice President and CFO of 

Teracom Group AB, the Presidents of the active subsidiaries 

in Sweden, Denmark and Finland and heads of the Group 

functions Finance, Communication, Human Resources and 

Strategy and Business Development. The Group management 

team formulates and develops the Group's mission, goals and 

strategies through discussions with the Board and it is also 

responsible for the on-going administration of the Group. 

Changes to the functions included in the Group management 

team for 2012 are that, as of January, the head of Finance 

will no longer participate and, as of March 12, the head of 

the new function, Product, will join. 

The President/CEO is Chairman of the Group management 

team and decides on the control mechanisms for the 

subsidiaries and Group functions. The subsidiaries handle the 

operational activities and are clearly accountable for their 

performance. The Group functions, which are placed in the 

Parent Company, have a functional responsibility within their 

areas of expertise and are charged with the task of actively 

supporting the Group management team and subsidiaries in 

their efforts to achieve the Group's goals. 

52

Evaluation of the Board of Directors and President/CEO 

The Board's Rules of Procedure stipulates that there should 

be a written evaluation of the work done by the Board and 

the President/CEO during the past year covering topics such 

as how well the Board has collectively executed its tasks and 

the performance of individual Board members. The evaluation 

is then submitted to the unit within the Ministry of 

Finance that is responsible for the nomination process. 

The Board executed an evaluation of its work and the 

work done by the President/CEO during 2011. A meeting to 

evaluate the President/CEO was held without any members 

of the senior management team present. 

Internal control within the Teracom Group 

Effective risk management and internal controls within the 

Group provide the foundation for long-term growth in value. 

The Teracom Group has established a set of rules, methods, 

routines and policy documents aimed at mitigating risks 

and increasing commercial advantages. Examples of such 

governing policies are the financial policy and the authorization 

rules. Risk management within the Group is based on 

established goals, both at a general level and at a secondary 

level. More information about risk factors and how they are 

managed by the Group is available on pages 45-46. 

Internal audit 

The Group discontinued its internal audit function during 

the year. The primary reason for this was to increase the efficiency 

of internal audit activities. 

The Group has implemented an annual self-evaluation 

that specifically states the internal control requirements the 

Group places on critical processes. 

The evaluation is conducted in both the subsidiaries and 

certain Group functions, depending on where the entire or 

parts of the process are carried out. The units should state if 

the control or measures are carried out and present in some 

cases proof of this. The auditors then review the answers 

with the units in question and conduct sample control tests. 

If the unit states that insufficient controls and measures 

have been taken, an action plan is prepared that outlines 

a schedule for the measures and appoints a responsible 

manager. These action plans are submitted to the auditors 

and the Group Finance Department at Teracom Group. 

To further ensure adequate internal control, the auditors 

annually conduct an in-depth review of several of the critical 

processes within the Group. 

It is the Board of Director's overall assessment that the 

proposed process ensures that the Group practices adequate 

internal control. The Board intends to evaluate the need for 

an internal audit function on an annual basis and explain its 

decision in the Corporate Governance Report. 

Auditors 

The auditors elected at the AGM are responsible for examining 

the annual report, the accounts, the work done by the 

Board of Directors and the President/CEO's administration. The 

owner is responsible for appointing the company's auditors. 

An administrator from the Swedish Government Offices monitors 

each step of the procurement process to determine the 

auditors, from procurement criteria to selection and evaluation. 

The final decision is made by the owner at the AGM. 

In accordance with the Companies Act, auditors are 

appointed to serve for a period of one year. Ongoing evaluations 

are conducted to correct any deficiencies that may arise 

and to clarify owner requirements. The audit firm PriceWaterhouseCoopers 

AB was appointed at an extraordinary general 

meeting of shareholders in March 2011. Sten Håkansson, 

who is the auditor-in-charge, also has audit assignments 

with companies such as COOR, Eniro and the Swedish Trade 

Council in addition to the Teracom Group audit assignment. 

The Board's description of internal control for financial 

reporting 

As per the Swedish Companies Act and the Code, the Board of 

Directors is responsible for the internal control. This report on 

internal control was prepared in accordance with section 7.4 

of the Code. As such, it is limited to a description of the internal 

control and risk management related to the financial statements. 

The Teracom Group uses Internal Control – Integrated 

Framework, which was launched in 1992 by The Committee 

of Sponsoring Organizations of the Treadway Commission 

(COSO). This is a recognized and established framework for 

internal control. The Group applies the framework described 

in the guidance to the Code. This framework advocates that 

internal control should be comprised of the following: 

• Control Environment 

• Risk Assessment 

• Control Activities 

• Information and Communication 

• Monitoring 

Control environment 

The control environment provides the basis for the internal 

control. It is comprised of the culture and values that exist 

within the Group. To a great extent, these are reflected in policies, 

guidelines and instructions. The control environment is 

also comprised of the allocation of responsibilities, authorities 

and decision paths that have been defined for the company. 

Risk assessment 

Risk assessments are made on a regular basis and are based 

upon the financial and non-financial goals that have been 

established for the Teracom Group. The Group goals are broken 

down into operational goals for each subsidiary and Group 

function. These goals are communicated to the organization. 

In order to achieve these goals, the Group has a process that 

is based upon materiality criteria. The process also involves 

identifying any external or internal risks that could present 

obstacles to the company's ability to achieve its goals. In 

conjunction with the planning of the internal audit, a number 

of different critical areas for financial reporting are identified 

and selected for special examination. During 2011, two areas 

53

were examined: revenue processes and salary processes. One 

aspect of the critical processes related to the financial statements 

is to conduct risk assessment in order to make sure that 

controls are in place that provide reasonable assurance on the 

accuracy of the company's financial reporting. 

Control activities 

Control activities exist within each area where management 

has assessed that there is the greatest risk of a significant 

impact on the financial statements. Among other things, 

these activities include reporting on deviations, attestation 

controls, follow-up on budgets, review of authorizations and 

authorities, and follow-up on investments. They also include 

several key controls related to the reporting process, which 

are performed by the person in the organization who has 

been allocated responsibility for that task. The effectiveness 

and design of controls are periodically reviewed and tested. 

The Group management team also relies on the information 

in employee surveys regarding opportunities for improvement 

that exist throughout the organization. 

Information and communication 

The purpose of the Group's information activities is to regularly 

provide employees, as well as external stakeholders, 

with true and fair information about the Group. The external 

information should be factual, accessible, honest and 

relevant. According to the Government Ownership Policy, 

external reporting for state-owned companies should be 

just as transparent as it is for companies listed on the stock 

exchange. Therefore, external reporting should, where applicable, 

follow the recommendations set out in Nasdaq OMX 

Stockholm's regulations. Annual reports and interim reports 

are published at www.teracomgroup.se. Internal information 

is primarily communicated via the company's Intranet and 

managers. Policies, guidelines and instructions are available 

to all employees via the company's intranet and commonly 

accessible disks. The Group's information and communication 

channels for financial reporting purposes are deemed 

to be appropriate and well-known. As such, reporting and 

feedback from the business to the Board of Directors and 

management team is thus possible. Financial information is 

collected in conjunction with the month-end closing. Those 

persons in charge of subsidiaries and Group functions are 

responsible for commenting on such information as well 

as any follow-up. This is compiled in a monthly report that 

describes the Group's development. These reports are distributed 

to the Board of Directors, the Group management team 

and the management teams of each subsidiary. 

Follow-up 

In this phase of control activities, it is possible to assure 

the quality of financial reporting and identify any potential 

deficiencies. The company's controller function is responsible 

for monitoring the business and reporting to the Group 

management team. The Group management team and Board 

of Directors are assisted by the audit committee and the 

company's auditors, which regularly examine and test how 

risk management, controls and the management systems are 

functioning within the organization. They also help to ensure 

that the internal controls that are in place are working as 

intended to achieve the stated goals. 

Governance for increased profitability and a sustainable 

society 

Focus on responsibility and business orientation 

The catchwords for the government's administration of 

wholly owned companies are openness, active ownership and 

orderliness. 

The owner expects its fully owned and administered 

companies to serve as role models in sustainability issues. 

Since 2008, the Group has improved by working on sustainability 

issues in a more structured way. This has been a 

learning process, where the Group has collected the experiences 

of its companies and is always striving to improve 

and renew itself. The Teracom Group reports its sustainability 

work in accordance with the GRI guidelines at the C+ level. 

Policies and guidelines 

In order to define the Group's fundamental values, a decision 

was made in 2010 to update and develop new Group-wide 

policies, which were adopted by the Board in December 2011: 

• Ethics policy 

• Information and Public Affairs policy 

• Investment policy 

• Finance policy 

• Security policy 

• Remuneration policy 

In addition, there are also the following Group policies: 

• Diversity policy 

• Environmental policy 

• Information security policy 

The policies provide the foundation for sustainability 

work and were developed in stages. The ability to understand 

and live up to these policies on a daily basis is what provides 

real value when conducting business and to the Group's 

stakeholders. For this reason, it is important to find ways 

of implementing the policies that reach all employees. To a 

limited extent, companies belonging to the Group supplement 

these with company-specific policies, such as quality, 

work environment and network security policies. 

Ethics policy 

The Ethics policy takes precedence over other policies and 

governance documents in the Group. It aims to provide 

support and guidance to managers and employees. The 

policy is based on the OECD Guidelines for Multinational 

Companies and the ten principles in the UN Global Compact, 

such as human rights, the environment, diversity, labor law 

and anti-corruption. 

The purpose of the policy is to ensure that all of the 

Group's companies and employees behave in a manner that 

strengthens the organization's profitability while simultane- 

54

ously striving to achieve long-term social, environmental and 

financial sustainability. It is possible for every employee to 

report incidents that deviate from the Ethics Policy, or the 

underlying governance documents and instructions, without 

it resulting in any form of discrimination of punishment. 

Environmental management 

Within the Group there is a Group-wide organization for environmental 

work. The basis for this work is the environmental 

policy, and the managers of the Group's various business 

activities should ensure that the policy is put into practice in 

their respective areas. The policy establishes overall principles 

for how the Group should work to achieve a more sustainable 

society, from an environmental perspective. Each company 

is responsible for integrating the environmental work into a 

natural part of its daily operations, thus reducing the Group's 

total environmental impact. According to the environmental 

policy, the impact on the environment will be minimized by: 

• at the Group level, working long term and preventively for 

a sustainable development of society, in which the environment 

is an important aspect 

• at each company, identifying the areas that have an impact 

on the environment; then, prioritizing and working 

with the issues that cause the overall environmental impact 

to decrease 

• methodically establishing goals and action plans and following 

up and evaluating the results of environmental 

work in order to raise efficiency, quality and achieve continual 

improvements 

• always complying with legal requirements by creating and 

following internal instructions related to the environment 

• treating environmental issues with a great deal of openness, 

developing the Sustainability Report and communicating 

actively with the surrounding world in order to 

improve cooperation 

• ensuring that all employees are aware of their own responsibility 

to strive to decrease environmental impact 

and that they are familiar with, and have access to, the 

environmental policy 

In order to systematically approach the efforts to 

minimize its environmental impact, the Group decided set up 

an environmental goal of decreasing its emissions 3 percent 

a year until 2020. Based on this environmental goal and the 

Teracom Group's documentation, activities designed to have 

a beneficial impact on the environment will be implemented 

at the companies during 2012. (Read more about the decided 

activities in the Environmental section on pages 31-33 and 

the country sections in the first section of the Annual Report.) 

The Managing Director of each Group company has the 

ultimate legal responsibility for the environmental work at 

that company. The Teracom Group AB's environmental unit 

monitors laws and requirements and provides support for 

the managers responsible for implementing corresponding 

routines in the organization. Each company has appointed an 

environmental coordinator who will work with environmental 

issues on a part-time basis and form a link between the 

Environmental Manager and the companies. These coordinators 

also form an environmental group that meets twice a 

year to find ways for the companies to work together. The 

result of this work and decisions from the group are to be 

reported to the management team of each company as well 

as the Group management team. The environmental policy 

states that all of the Group's employees are responsible for 

making an effort to decrease the environmental impact. 

Furthermore, whenever environmental incidents occur 

within the Teracom Group, the environmental unit is responsible 

for investigating the incident, suggesting improvements 

and reporting the results to the management team. 

This facilitates more systematic monitoring and simplifies 

continual follow-up. 

In accordance with the Environmental Code, the areas of 

operations that require a permit or must be reported include 

the handling of cooling agents at broadcast stations, the 

transportation of dangerous waste products and permits for 

storing oil at broadcast stations. All of these activities are 

performed by Teracom AB. 

Work environment and safety 

Teracom Group takes considerable responsibility for the 

safety of its employees, as well as for their work environment 

in general. The Swedish operations have had a structured 

work environment policy for a long time. Risky work assignments 

require training and the proper protective equipment. 

The Protection Committees at Teracom AB, which consist 

of managers and safety representatives, have constant access 

to relevant knowledge and requirements via the Group 

function Facility management and environment, which is 

knowledgeable in matters pertaining to the work environment 

and environmental safety. Each company's management 

team is responsible for company-wide efforts pertaining 

to the work environment and environmental safety 

issues. Teracom AB's Protection Committee is responsible for 

reporting any environmental and work environment incidents 

to the company management team. Teracom AB's Protection 

Committee also serves as an advisory body. The Protection 

Committee's recommendations should serve as guidelines for 

decisions on measures to be taken at the authorized level of 

the companies. Starting in 2012, work environment issues for 

the Swedish portion of the Group will be handled by a joint 

Work Environment Committee. 

Crisis organization 

It is very important that Teracom AB has reliable operations 

and can provide a high level of service. In the event of 

crises and serious disruptions, Teracom AB activates a wellestablished 

organization to effectively limit damages and 

restore operations. The requirements within digital TV and 

FM radio are particularly high. In addition to its assignment 

to safeguard public service broadcasts from democratic and 

educational perspectives, Teracom AB offers services that are 

important to society. One example is the service Important 

Public Announcements (IPA), which must always be available 

in the event the general public must be warned about serious 

events. Radio newspapers, a service that provides people with 

different types of functional disabilities access to daily newspapers 

and for which Teracom provides the technical platform, 

are also important. 

55

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

Group management 

1. Crister Fritzson (Born 1961) 

President and CEO, employed since 2001. Previously 

President of Boxer TV-Access AB, Vice President 

with global responsibility for Marketing and Sales at 

Allgon Systems, Channel Manager at Motorola and 

Head of Nordic/Baltic Region at Motorola. Board 

assignments at Boxer TV-Access AB, Digi TV Plus 

Oy and Boxer TV A/S. Diploma in Market Economy 

and MBA from Nordic School of Marketing and 

Executive Management Program at INSEAD. 

2. Gunilla Berg (Born 1960) 

Executive Vice President and CFO, employed since 

2010. Previously Executive Vice President and CFO for 

the SAS Group, Executive Vice President and CFO for 

the Swedish Cooperative Union (KF) and various management 

positions at AGA and Svenska Shell. Board 

assignments at Alfa Laval AB and Lundbergföretagen 

AB. MSc from the Stockholm School of Economics. 

3. Steffen Weber (Born 1967) 

Acting Managing Director of Teracom A/S, 

employed since 2009. Previously CFO at Teracom 

Denmark, CFO at Privathospital Hamlet, CFO at 

TDC Norway and Controller at Nykredit A/S. MSc in 

Business Administration and Managerial Accounting 

from Copenhagen Business School. 

4. Pierre Helsén (Born 1951) 

Director of Strategy & Research, employed since 

July 2007. Previously Head Secretary at the Digital 

TV Commission, Investment Manager at Skandia 

Mediainvest, CFO at SVT and CFO at TV4. Board 

assignments at Sundbybergs Stadsnätsbolag & 

Pampas Produktion. Studied business management 

at Uppsala University. 

5. Niklas Engström (Born 1973) 

Director of Product, employed since 2012. Previously 

manager at New Business & Product Management 

Bredbandsbolaget, manager at Media & 

Entertainment XlentStrategy and consultant at 

Andersen Consulting. MSc in Industrial Economics 

& Management from the KTH Royal Institute of 

Technology in Stockholm. 

6. Stephan Guiance (Born 1960) 

Managing Director of Teracom AB, employed since 

2008. Previously President of FastTV.net AB and 

employed at Sweden On Line, as President for the 

years 1995–2002. Studied business management at 

Stockholm University. 

7. Andrea Gisle Joosen (Born 1964) 

Managing Director of Boxer TV-Access AB, 

employed since 2011. Previously Managing 

Director Panasonic Nordic AB, Managing Director 

Nordic for Chantelle AB, Managing Director Nordic 

for Twentieth Century Fox Home Entertainment 

AB, Marketing Director Nordic at Johnson & 

Johnson Consumer Products AB. Board assignment 

at Board Hakon Invest AB. MSc in Business and 

Economics from Copenhagen Business School. 

8. Jyri Ratia (Born 1972) 

Managing Director of Digi TV Plus Oy, employed 

since 2010. Previously Senior Vice President, 

Business Development Sanoma Entertainment Oy, 

Vice President Television Welho cable operator 

business Sanoma Television Oy, Head of Marketing 

and Sales, Marketing Manager Brand Manager 

Sanoma Television Oy. MSc (Econ) Helsinki School 

of Economics. 

9. Steen Ulf Jensen (Born 1966) 

Managing Director of Boxer TV A/S, employed since 

2008, associated with Boxer since 2006. Previously 

Founder and Partner at Jensengroup Consulting 

playing a key role in Boxer's application as 

operator in Denmark, CEO of Viasat Distribution, 

Chief Operating Officer Viasat Broadcasting, CEO 

of Viasat Denmark. Board assignment at AH Metal 

Solution. MBA from Copenhagen Business School. 

10. Marianne Winblad von Walter (Born 1969) 

Human Resources Director, employed since 2010. 

Previously HR Director NASDAQ OMX, HR Manager 

Gillette Group Nordic, HR Specialist and Acting 

Head of HR at MTG AB. BSc from Uppsala University. 

11. Johan Bobert (Born 1960) 

Communications Director, affiliated with Teracom 

and Boxer since 2002, employed since 2011. Previously 

Partner and Executive Vice President at Hill 

& Knowlton Sweden AB and Senior Consultant at 

Jerry Bergström AB. Studied political science and 

history at Stockholm University. Studied marketing 

communications at RMI Berghs. 

56

1 

2 

3 4 

5 

6 

7 

8 

9 

10 

11 

12 


1. Åsa Sundberg (Born 1959) 

Chairman of the Board since 2008, Managing Director 

Net 1 Sverige. Active in, and partner of the risk capital 

company, Provider Venture Partner. Previously CEO 

of Telia Engineering and Telia Prosoft as well as head 

of Telia's International Network and Carrier business. 

Other current and previous board assignments at 

Aspiro AB, The Cloud Networks Ltd, Fox Technologies 

Inc, APTV AB and Mobilaris AB. MSc from the KTH 

Royal Institute of Technology in Stockholm. 

2. Lars Grönberg (Born 1949) 

Member since 2005. Previously President and CEO of 

Intrum Justitia and director responsible for foreign 

operations at TeleDenmark. Other board assignments 

at Matkompaniet AB, Bindomatic AB, Connecta AB, 

Br. Perssons Byggnads AB, Business Security AB, 

Qamcom AB, Quadracom AB and Skandia Elevator AB. 

MSc and PhD from Stockholm School of Economics. 

3. Kristina Axberg Bohman (Born 1959) 

Member since 2007, President of Bohman Consulting 

& Advisory AB. Previously CFO at Manpower, 

CFO at LG P Telecom, Financial Controller at Telia 

AB and Financial Controller at Akzo Nobel. MSc 

from Linköping University. 

4. Urban Lindskog (Born 1965) 

Member since 2007, President of Oryx Simulations 

AB. Previously CEO of Scharp & Lindskog AB 

and Lindskog & Partners AB, CEO of Catella IT AB. 

Other board assignments at Algoryx Simulation 

AB, Carmenta Sverige AB and Sonetel AB. MSc in 

system engineering from the KTH Royal Institute of 

Technology in Stockholm and MBA from INSEAD in 

Fontaine bleau, France. 

5. Maria Curman (Born 1950) 

Member since 2007, President of Bonnier Books. 

Previously MD for SVT and President and Director 

of Bonnier Utbildning AB. Other Board assignments 

at Axfood, Bonnier Media Germany, 

Cappelen Damm Norway and Bonnierförlagen AB. 

MSc from the Stockholm School of Economics. 

6. Nils-Petter Tetlie (Born 1965) 

Member since 2011, President of Fujifilm Sverige AB 

Previously Executive Vice President at Bredbandsbolaget, 

Network Director at Telia AS. Other (previous) 

board assignment at Aspiro AB. MSc from Heriot 

Watt University/Edinburgh. 

7. Ingrid Engström (Born 1958) 

Member since 2003, Senior Executive Advisor SE 

B. Previously Senior Vice President Operations, 

Purchase and HR at Eniro AB, President of Know 

It AB and President of ComHem AB. Other board 

assignment at Bisnode. MA in Applied Psychology 

from Uppsala University. 

8. Johan Hallberg (Born 1974) 

Member since 2011. Administrator, Swedish Government 

Offices. Previously Lenner & Partners, Director 

– Team Head for Stockholm Corporate Finance and 

Associate at HSBC Investment Bank in London. Other 

board assignments at Metria AB and Oak Capital 

Group AB. MSc from Stockholm School of Economics. 

9. Stig-Arne Celin (Born 1953) 

Deputy Board Member since 2002, union representative 

for ST at Teracom Group. Service engineer at 

Gävle FM/TV station, Teracom Sweden. 

10. Magnus Ahxner (Born 1973) 

Member since 2011, union representative for 

Akademikerna at Teracom Group. Business development 

at the Teracom Group. Deputy member of 

Teracom AB's Board of Directors in 2010. 

11. Niklas Hanson (Born 1977) 

Deputy Board Member since 2011, union representative 

for Akademikerna at Teracom Group. Project 

manager at the Teracom Group. 

12. John-Olof Blomkvist (Born 1949) 

Member since 1995, union representative for ST 

at Teracom Group. Maintenance planner at the 

Teracom Group. 

Auditors 

PriceWaterhouseCoopers AB, auditor-in-charge 

Sten Håkansson – authorized public accountant 

and sustainability verification officer Fredrik 

Ljungdahl – expert member of FAR. 

57

Financial overview of the Group 

MSEK 2011 2010 2009 2008 2008* 2007 2006 2005 

Net profit/loss 

Operating income 4 059 3 852 3 408 2 991 3 188 3 312 3 004 2 700 

Depreciation/amortization and impairment -423 -349 -281 -277 -374 -429 -408 -411 

Operating profit/loss 376 293 496 635 581 625 495 360 

Profit (loss) before taxes 325 281 483 622 568 669 490 359 

Profit (loss) for the year 168 201 269 460 421 470 354 277 

of which holdings without a controlling interest - - - 91 91 80 56 33 

Financial position* 

Total assets 5 553 5 698 4 190 3 765 3 765 3 803 3 919 3 644 

Equity 1 773 1 743 1 685 1 666 1 666 1 810 1 776 1 602 

of which holdings without a controlling interest 0 0 0 0 0 80 86 60 

Interest-bearing liabilities 2 016 2 381 1 016 306 306 7 11 15 

Non-interest bearing liabilities 1 764 1 574 1 489 1 793 1 793 1 906 2 046 1 967 

Cash flow 

Cash flow from operating activities 645 789 286 618 581 995 738 827 

Cash flow from investing activities -344 -1 528 -519 -1 200 -1 242 -238 -263 -447 

Cash flow from financing activities -458 1 040 293 -180 -180 -436 -219 -208 

Cash flow for the year -157 301 60 -762 -841 321 256 172 

Key ratios 

Operating margin, % 9 8 15 21 18 19 16 13 

Return on equity, % 10 12 16 26 24 26 21 19 

Return on capital employed, % 10 10 22 34 32 34 27 18 

Equity ratio, % 32 31 40 44 52 48 45 44 

Debt/equity ratio 0,98 1,12 0,54 0,14 0,14 0 0 0 

EBITDA 799 642 777 912 955 1 054 903 771 

Net liability over EBITDA 2 177 3 041 1 171 254 243 -161 -168 -417 

Average number of employees 707 707 638 669 669 674 687 697 

* Including operations that were discontinued in 2009 

58

Consolidated Income Statement 

MSEK Note 2011 2010 

Operating income 2,3,4 

Net sales 4 046 3 848 

Other income 13 4 

4 059 3 852 

Work performed by the company for its own use and capitalized 5 25 9 

Operating expenses 

Material costs -214 -235 

Personnel expenses 6,7 -614 -571 

Depreciation/amortization 4,8 -404 -331 

Impairment 4,9 -19 -18 

Transmission -385 -472 

Program company costs -1 038 -972 

Other expenses 10,11 -1 034 -969 

Operating profit/loss 4 376 293 

Financial income 12 27 37 

Financial expenses 12 -78 -49 

Profit (loss) before taxes 325 281 

Tax on profit for the year 13 -157 -80 

Profit (loss) for the year 168 201 

Consolidated Statement of Comprehensive Income 

MSEK 2011 2010 


Other comprehensive income: 

Cash flow hedges -37 0 

Hedges of net investments -6 0 

Translation differences 3 -33 

Income tax related to "Other comprehensive income" items 12 0 

Total Other comprehensive income for the year, net after tax -28 -33 

Total comprehensive income for the year 140 168 

Comprehensive income for the period related to: 

Parent Company shareholders 140 168 

Holdings without a controlling interest 0 0 

Total comprehensive income for the year 140 168 

59

Consolidated Balance Sheet 

MSEK Note 2011-12-31 2010-12-31 

ASSETS 

Fixed assets 

Land and buildings 15 755 771 

Plant and machinery 15 1 969 2 071 

Equipment, tools, fixtures and fittings 15 31 33 

Construction-in-progress 15 238 164 

Goodwill 16 1 181 1 214 

Other intangible assets 16 257 351 

Other financial assets 17 95 114 

Derivative instruments 21 2 0 

Total fixed assets 4 528 4 718 

Current assets 

Inventories 19 67 25 

Accounts receivable 20 321 295 

Income tax recoverable 18 0 

Other receivables 44 24 


Prepaid expenses and accrued income 22 329 242 

Other financial receivables 26 0 

Cash equivalents 21 220 377 

Total current assets 1 025 980 

TOTAL ASSETS 5 553 5 698 

EQUITY AND LIABILITIES 

Equity 23 

Share capital 0 250 

Other contributed capital 1 633 653 

Translation reserve -77 -49 

Earned profits including net profit/loss for the year 217 889 

Total equity 1 773 1 743 

Long-term liabilities 

Liabilities to credit institutions 3, 21 1 783 2 134 


Deferred income 24 79 70 

Deferred tax liabilities 18 330 362 

Provisions for pensions and similar obligations 7,25 1 1 

Total long-term liabilities 2 209 2 567 

Current liabilities 

Liabilities to credit institutions 3, 21 75 76 

Accounts payable 442 329 

Other current liabilities 285 217 


Accrued expenses and deferred income 24 755 764 

Provisions 25 4 2 

Total current liabilities 1 571 1 388 

Total liabilities 3 780 3 955 

TOTAL EQUITY AND LIABILITIES 5 553 5 698 

Pledged assets 28 0 0 

Contingent liabilities 29 0 0 

60

Consolidated Cash Flow Statement 

MSEK Note 2011 2010 

Operating activities 

Operating profit/loss 376 293 

Depreciation/amortization and impairment 423 349 

Other items not affecting liquidity 105 44 

Interest received 9 1 

Interest paid -62 -17 

Income tax paid -149 -165 

Cash flow from operating activities before changes in working capital 702 505 

Cash flow from changes in working capital 

Change in inventories -42 37 

Change in accounts receivable -26 134 

Change in other operating assets -108 27 

Change in accounts payable 112 17 

Change in other operating liabilities 7 69 

Cash flow from changes in working capital -57 284 

Cash flow from operating activities 645 789 

Investing activities 

Investments in property, plant and equipment -287 -242 

Investments in intangible assets -45 -42 

Acquisition of subsidiaries 27 0 -1 241 

Other -12 -3 

Cash flow from investing activities -344 -1 528 

Financing activities 

New loans 27 1 809 

Amortization of loans -375 -659 

Dividends -110 -110 

Cash flow from financing activities -458 1 040 

Cash flow for the year -157 301 

Cash equivalents at the beginning of the year 377 78 

Exchange rate differences on cash equivalents 0 -2 

Cash equivalents at the end of the year 220 377 

61

Consolidated Statement of Changes in Equity 

MSEK 

Share capital 

Attributable to the Parent Company's shareholders 

Other 

contributed 

capital 

Reserves 

Profit 

brought 

forward 

Opening balances, 1 January 2010 250 653 -16 798 1 685 

Comprehensive income 


Other comprehensive income 

Exchange rate differences -33 -33 

Total Other comprehensive income 0 0 -33 0 -33 

Total comprehensive income 0 0 -33 201 168 

Transactions with shareholders 

Dividend pertaining to 2009 -110 -110 

Total transactions with shareholders 0 0 0 -110 -110 

Total 

equity 

Opening balances, 1 January 2011 250 653 -49 889 1 743 



Other comprehensive income 

Cash flow hedges -37 -37 

Hedging of net investment -6 -6 

Exchange rate differences 3 3 

Income tax related to Other comprehensive income 12 12 

Total Other comprehensive income 0 0 -28 0 -28 

Total comprehensive income 0 0 -28 168 140 

Transactions with shareholders 

Dividend pertaining to 2010 -110 -110 

New Group structure 1 June 2011 -250 980 - -730 0 

Total transactions with shareholders -250 980 0 -840 -110 

Closing balance, 31 December 2011 0*) 1 633 -77 217 1 773 

*) Share capital amounts to SEK 50,000 

62

Parent Company Income Statement 

MSEK 

Note 

2011-06-01 


Operating income 2,14 

Net sales 33 

33 

Operating expenses 

Other external expenses 10,11 -13 

Personnel costs 6,7 -57 

Operating profit/loss -37 

Profit from financial investments 

Interest income and similar items 12 24 

Income from Group companies 12 297 

Interest expenses and similar items 12 -83 

Profit/loss after financial items 201 

Deferred tax 13 25 

Profit (loss) for the year 226 

Parent Company Statement of Comprehensive Income 

MSEK 

Note 



Net profit/loss for the period 226 


Other comprehensive income: 

Other comprehensive income for the year, net after tax 0 

Total comprehensive income for the year 226 

63

Parent Company Balance Sheet 

MSEK Note 2011-12-31 

ASSETS 

Fixed assets 

Financial assets 

Participations in Group companies 26 5 292 

Receivables from Group companies 14 134 

Deferred tax assets 18 25 

Total financial assets 5 451 

Total fixed assets 5 451 

Current assets 

Receivables from Group companies 14 377 

Prepaid expenses and accrued income 22 2 

Total current receivables 379 

Cash and bank balances 21 212 

Total current assets 591 

TOTAL ASSETS 6 042 

EQUITY AND LIABILITIES 

Equity 23 

Restricted equity 

Share capital 0 

Total restricted equity 0 

Non-restricted equity 

Profit brought forward 1 633 


Total non-restricted equity 1 859 

TOTAL equity 1 859 

LIABILITIES 

Long-term liabilities 

Liabilities to credit institutions 21 1 783 

Liabilities to Group companies 14 1 510 

Total long-term liabilities 3 293 

Current liabilities 

Liabilities to credit institutions 21 75 

Accounts payable 2 

Liabilities to Group companies 14 789 

Income tax liability 3 

Other current liabilities 3 

Accrued expenses and deferred income 24 14 

Provisions 25 4 

Total current liabilities 890 

TOTAL EQUITY AND LIABILITIES 6 042 

MEMORANDUM ITEMS 

Pledged assets 28 0 

Contingent liabilities 29 0 

64

Parent Company Cash Flow Statement 

MSEK Note 2011 

Operating activities 

Profit/loss before financial items -37 

Other items not affecting liquidity -2 

Interest received 2 

Dividends received 297 

Interest paid -59 

Cash flow from operating activities before changes in working capital 201 

Cash flow from changes in working capital 

Change in Group receivables -373 

Change in Other current assets -6 

Change in Other operating liabilities and provisions 815 

Cash flow from changes in working capital 436 

Cash flow from operating activities 637 

Investing activities 

Acquisition of subsidiaries 26 -5 292 

Investments in other financial assets -134 

Cash flow from investing activities -5 426 

Financing activities 

New issue 1 633 

New long-term loans 3 878 

Amortization of long-term loans -510 

Cash flow from financing activities 5 001 

Cash flow for the year 212 

Cash equivalents at the beginning of the year 0 

Cash equivalents at the end of the year 212 

65

Parent Company Statement of Changes in Equity 

MSEK 

Share capital 

Other 

contributed 

capital 

Statutory 

reserve 

Profit 

brought 

forward 

New Group structure 1 June 2011 0*) 1 633 0 0 1 633 



Total 

Other comprehensive income 0 0 0 0 0 

Total Other comprehensive income 0 0 0 0 0 

Total comprehensive income 0 0 0 226 226 

Transactions with shareholders 0 0 0 0 0 

Total transactions with shareholders 0 0 0 0 0 

Closing balance, 31 December 2011 0 1 633 0 226 1 859 

*) Share capital amounts to SEK 50,000 

66

Notes 

Contents 

Note Description Page 

1 Accounting and valuation principles 67 

2 Operating income 72 

3 Leases 72 

4 Segment reporting 73 

5 

Work performed by the company for its own use and 

capitalized 

73 

6 Employees and remuneration 74 

7 Pensions 76 

8 Depreciation/amortization 78 

9 Impairment 78 

10 Other expenses 78 

11 Remuneration to auditors 78 

12 Financial income and financial expenses 78 

13 Tax on profit for the year 79 

14 Information concerning closely related parties 79 

15 Property, plant and equipment 80 

Note Description Page 

16 Goodwill and other intangible assets 81 

17 Other financial assets 83 

18 Deferred tax 83 

19 Inventories 84 

20 Accounts receivable 84 

21 Financial instruments and financial risk management 84 

22 Prepaid expenses and accrued income 87 

23 Equity 88 

24 Accrued expenses and deferred income 88 

25 Provisions 88 

26 Shares and participations in Group companies 89 

27 Acquired businesses 89 

28 Pledged assets 89 

29 Contingent liabilities/guarantees 89 

Note 1. Accounting and valuation principles 

Basis for the preparation of the financial statements 

The consolidated financial statements have been prepared in accordance with 

IAS 27 and through application of International Financial Reporting Standards 

(IFRS) as adopted by the EU. The application of these standards has been 

supplemented by the interpretations issued by the International Financial 

Reporting Interpretations Committee (IFRIC). 

The consolidated financial statements were prepared in accordance with 

the cost method with the exception of financial assets and liabilities (including 

derivative instruments) valued at fair value via the income statement. 

Some disclosures are prepared in accordance with Swedish Financial Reporting 

Board Recommendation RFR 1, the Annual Accounts Act and the requirements 

set forth by the Government Ownership Policy. The Parent Company's 

financial statements are prepared in accordance with the same accounting 

principles as the consolidated financial statements, with the exception of that 

described in the section Parent Company Accounting Principles. 

The consolidated financial statements and annual report for the financial 

year ending on 31 December 2011 were approved for issue by the Board of 

Directors and Group CEO/President on 16 March 2012 and will be brought 

forth for adoption at the Annual General Meeting on 18 April 2012. 

Consolidated financial statements 

The consolidated financial statements are prepared in accordance with the 

purchase accounting method. This method implies that the identified assets, 

liabilities and contingent liabilities of the operations acquired are reported 

at fair value at the time of the acquisition, in accordance with a prepared 

acquisition analysis. The acquisition cost for an acquisition includes the fair 

value of assets submitted as consideration and liabilities incurred or assumed 

on the day of transfer. This amount includes the fair value of assets or liabilities 

resulting from agreements for additional consideration. Expenses directly 

attributable to the acquisition are recognized as they are incurred. Goodwill 

arises and is reported as an asset whenever the consideration exceeds fair 

value as determined by the acquisition analysis. 

The Group's consolidated financial statements include the financial statements 

of the Parent Company and its directly or indirectly owned subsidiaries 

after the elimination of intra-Group transactions, unrealized gains from 

inventories and amortization of acquired surplus values. 

Definition of Group companies 

The consolidated financial statements include Teracom Group AB and all 

subsidiaries. Subsidiaries are companies in which Teracom Group AB either 

directly or indirectly holds more than 50 percent of the voting rights or in 

some other way exercises a controlling influence. 

With regard to companies acquired or divested during the year, the following 

applies: 

- Companies acquired during the year were included in the consolidated 

income statement as of the date control of the company was obtained. 

- Companies divested during the year are included in the consolidated income 

statement up until the date Teracom's control was terminated. 

Transactions with closely related parties 

All transactions with closely related parties are based on market prices. 

Foreign currency translation 

The consolidated financial statements are prepared in SEK, which is the Parent 

Company's functional and reporting currency. 

Transactions in foreign currencies are converted to the relevant currency 

using the exchange rate applicable on the transaction date. Financial assets 

and liabilities expressed in foreign currencies are reported in the balance sheet 

after valuation at the exchange rate prevailing on the balance sheet date. 

Exchange rate differences arising during the period due to operating receivables 

and operating liabilities are reported as part of operating profit (loss), 

whereas exchange rate differences attributable to financial assets and liabilities 

are reported as part of the profit (loss) from financial investments. The 

portion of the exchange rate differences that comprises an effective hedge of 

net investments is reported under Other comprehensive income. 

The balance sheets of foreign subsidiaries were translated to SEK using the 

exchange rate prevailing on the balance sheet date. Goodwill and adjustments 

to fair value arising from acquisitions of foreign companies are treated as 

assets and liabilities in the foreign subsidiary and translated at the exchange 

rate prevailing on the balance sheet date. The income statements were translated 

using the average exchange rate for the year. The translation difference 

arising from the translation is reported directly under Other comprehensive 

income. 

67

The Group uses forward contracts and loans in foreign currency to hedge 

certain foreign net investments. Exchange rate differences arising as result of 

these contracts and loans are transferred to consolidated other comprehensive 

income to the extent they correspond to translation differences. 

Following the divestment of a foreign subsidiary, the accumulated 

exchange rate differences, which were previously transferred to Other comprehensive 

income, are reported in the profit/loss for the period as a part of 

the profit or loss attributable to the sale. 

Segment reporting 

For the Teracom Group, the Group management team has been identified 

as the senior-most decision making body. The Group management team 

has established operating segments based on the information used to make 

strategic decisions. The operating segments are responsible for the operating 

profit and the working capital that they manage. Financial expenses, financial 

income and income tax are dealt with at the Group level. The "Other" item 

comprises Group functions, including Group management. These functionbased 

departments have income of insignificant amounts, which is why they 

are not considered to be separate operating segments (in accordance with 

IFRS 8). 

The segments are reported in accordance with the same accounting principles 

that are applied by the Group. Sales between segments occur at market 

terms and prices that are fair estimates of current market prices. 

Recognition of revenue 

Revenue is recognized when it is probable that the financial benefits will flow 

to the Group and the amount of revenue can be measured reliably. Revenue 

from fixed-price contracts for all segments is reported in the Parent Company 

in accordance with the percentage of completion method. Profit is thus 

recorded at the same rate as the work is completed, provided that the costs 

incurred or to be incurred in respect of the transaction can be measured reliably. 

Any expected loss on such contracts is recognized as an expense as soon 

as such loss is probable. For subscription contracts that provide the customer 

access to TV programs, revenue is recognized on a linear basis over the course 

of the contract term. This also applies to direct costs associated with such 

contracts, which are also recognized on a linear basis over the course of the 

contract term. Costs and income for program cards (which are needed to see 

the coded channels via a box and antenna) are not distributed over the course 

of the contract term since these cards cannot be returned. Both the income 

and costs for program cards are reported at the time card fee is invoiced to 

the customer. 

Net sales 

Net sales pertains to revenue from services that have been sold and subscriptions 

that are part of the Group's ordinary operations, less any discounts and 

value-added tax. 

Other income/other operating income 

Other income is income obtained from activities that are not part of the 

Group's ordinary operations. 

Borrowing costs 

Borrowing costs, i.e. interest rates and other costs incurred in connection with 

the borrowing of funds, are recognized in the income statement for the period 

to which they refer. There are no loan expenses that are directly attributable 

to the purchase, performance or production of a qualified asset and thereby 

should be capitalized in the asset's cost of acquisition. 

Taxes 

Reported tax is made up of current tax and deferred tax. Current tax refers to 

the profit or loss for the period and is valued at the tax rate prevailing on the 

balance sheet date. Deferred tax is comprised of amounts to be paid in the 

future or a reduction of future tax. Deferred tax is calculated in accordance 

with the tax rates decided or announced on the balance sheet date. 

Deferred tax is based on all identifiable temporary differences that exist on 

the balance sheet date. Temporary differences are defined as the difference 

between the carrying amount of an asset or liability and its tax base. Deferred 

tax assets on deficit deductions and temporary differences are reported as 

assets to the extent it is probable they will be utilized in the future. Deferred 

tax assets and deferred tax liabilities are reported net when they are attributable 

to a single tax authority and when a company or a group of companies, 

for example via a Group contribution, is legally entitled to net tax assets 

against tax liabilities. 

The carrying amount of deferred tax assets is reviewed at the end of each 

reporting period and reduced to the extent that it is no longer probable that 

sufficient taxable profit will be available to allow the benefit of part or all 

of that deferred tax asset to be utilized. Any such reduction is subsequently 

reversed to the extent that it becomes probable that sufficient taxable profit 

will be available. 

Property, plant and equipment 

Items of property, plant, and equipment are recognized as assets when it is 

probable that the future economic benefits associated with the asset will flow 

to the Group, and the cost of the asset can be measured reliably. Property, 

plant and equipment are reported at historic cost with deductions for linear, 

accumulated depreciation and any impairment. Depreciation is calculated 

from the point when an asset is acquired or a new plant is put into operation. 

Estimated useful lives are applied to both groups of assets and individual 

assets. Land is not depreciated since its useful life is judged to be unlimited. In 

all other cases, depreciation is calculated on a linear basis and is based on the 

following expected useful lives: 

Assets 

Land and buildings 

Buildings 

Land improvements 

Plant and machinery 

Permanent equipment in buildings 

Distribution equipment 

Radio equipment 

Power generating equipment 

Antenna sites 

Mast installations 

Equipment, tools, fixtures and fittings 

Vehicles 

Other equipment 

Useful life, years 

20-40 years 

10-20 years 

10-15 years 

3-10 years 

7-15 years 

10-15 years 

10-20 years 

20-30 years 

3-6 years 

3-5 years 

Construction-in-progress 

Construction in progress refers primarily to facilities that are being built. 

Construction-in-progress is valued in the same way as acquired assets, i.e. in 

accordance with the cost method at the cost of acquisition including directly 

attributable expenses – that is, valuation in accordance with the actual costs 

incurred. 

Intangible assets 

Goodwill 

Goodwill is reported as an intangible asset with an uncertain useful life at 

cost with deductions for accumulated impairment. 

Brands 

Acquired brands refers to Teracom's entitlement to use the Plus TV brand, 

which was acquired in June 2009, in Finland. The brand is reported as an 

intangible asset that is considered to have an uncertain useful life and is not 

amortized. 

Customer agreements 

The acquisition of Teracom A/S in September 2010 included customer agreements, 

which were reported as an intangible asset. Acquired customer agreements 

are amortized on a linear basis over their useful life, which is 3 years. 

Customer relations 

Both the acquisition of Digi-TV Plus Oy in June 2009 and the acquisition of 

Teracom A/S in September 2010 included customer relationships that were 

reported as intangible assets. These acquired customer relationships are 

amortized on a linear basis over their useful lives, which are judged to be 8 

and 9 years, respectively. 

Patents, licenses and similar rights 

Intangible assets are recognized when it is probable that the future economic 

benefits that are attributable to the asset will flow to the Group and the cost 

of the asset can be measured reliably. Acquired patents, licenses and similar 

rights are reported at cost with deductions for accumulated amortization and 

any impairment. Patents, licenses and similar rights are amortized on a linear 

basis over the useful life, which is 3 years. The network activities include 

capacity rights that are amortized over a useful life of 10 years. 

Test of impairment on fixed assets 

The Group assesses at each balance sheet date if there is any indication that 

the value of a non-current asset has depreciated. If such an indication arises, 

68

the Group conducts an impairment test, i.e. an assessment of the asset's 

recoverable amount. Recoverable amount refers to the higher of an asset's 

fair value, less sales expenses, and its value-in-use. Value-in-use is calculated 

as the present value of expected future cash flows that the asset is 

expected to generate. The asset is written down by the amount to which the 

asset's carrying amount exceeds the recoverable amount. When determining 

write-down requirements, the assets are grouped into cash-generating 

units. A cash-generating unit is the smallest group of assets generating cash 

flows that are in all material aspects independent of cash flows from other 

assets or groups of assets. In addition, the Group conducts an annual review 

of intangible assets with uncertain useful lives and intangible assets that are 

not yet available for use. An assessment of whether there are any indications 

of impairment is carried out at least once per year. 

Leases 

A lease is classified as a financial lease if it transfers substantially all of the 

risks and rewards incident to ownership from the lessor to the lessee. All other 

leases are classified as operating leases. 

Teracom as lessor 

Leases where the lessor retains substantially all of the risks and rewards incident 

to ownership are classified as operating leases. The Group's income from 

operating leases primarily comes from rental agreements related to co-locations 

in the Group's masts. Any leasing income that arises is allocated to the 

proper period and revenue is recognized linearly over the lease term. However, 

any costs that arise, including depreciation, are expensed as occurred. Depreciation 

is in accordance with the rules for each type of asset, respectively. 

Teracom as lessee 

Leasing agreements pertaining to fixed assets, where the Group retains substantially 

all of the risks and rewards incident to ownership, are classified as 

financial leases. At the inception of the lease, financial leases are reported in 

the balance sheet at the leased asset's fair value or the present value of the 

minimum lease payments (whichever is lower). Fixed assets obtained through 

financial lease agreements are primarily vehicles, which are depreciated over 

the asset's useful life or the term of the lease (whichever is shorter). Financial 

lease payments are appropriated between financial expenses, interest and the 

reduction (amortization) of the outstanding financial liability, so as to produce 

a constant periodic rate of interest on the remaining balance of the liability. 

The corresponding payment obligations, less the deduction of financial 

expenses, are included in the balance sheet items: Liabilities to credit institutions 

(long-term and short-term financial liabilities, respectively). Financial 

expenses are recognized in the income statement. 

For operating leases, the lease payments are recognized as an expense in 

the income statement over the lease term on a straight-line basis. 

Financial instruments 

Financial instruments are any type of contract that gives rise to a financial 

asset, financial liability or one's own capital instrument in another company. 

For the Group, financial instruments are comprised of the following: cash 

equivalents, interest-bearing receivables, accounts receivable, accounts payable, 

borrowings and derivatives. 

Classification of financial assets 

Management determines the initial classification of the financial asset. The 

purpose of the acquisition of the financial asset determines its classification. 

a) Financial assets valued at fair value via the income statement 

A financial asset is transferred to this category if it was acquired primarily to 

be sold in the short term. Derivatives are classified as held for trading, provided 

that they are not identified as hedges, which are valued at fair value via 

the income statement. Derivatives are only used for the purpose of managing 

the Group’s electricity, currency and interest rate risks. 

b) Loan receivables and accounts receivable 

Loan receivables and accounts receivable are financial assets with fixed or 

determinable payments. The receivables are reported as current assets, with 

the exception of receivables maturing more than 12 months after the balance 

sheet date, which are classified as non-current assets. The Group's cash 

equivalents, accounts receivable and loan receivables are included in this 

category. Cash equivalents consist of cash, bank balances and other current 

investments with high liquidity and a maturity of no more than three months 

that can be easily converted to a known cash amount and are only exposed to 

negligible risk of fluctuation in value. 

c) Investments held until maturity 

Investments held to maturity are non-derivative financial assets with fixed or 

determinable payments and fixed maturity that the company management 

has the positive intention and ability to hold to maturity. 

Recognition and measurement of financial assets 

Acquisitions and sales of financial assets are reported on the transaction date, 

i.e. the date the Group undertakes a binding commitment to buy or sell the 

asset. Financial assets are reported in the balance sheet when the Group has 

transferred the material risks and rewards associated with the transaction and 

the counterpart has an obligation to pay. A financial asset is removed from 

the balance sheet when the right to receive cash flows from the asset has 

expired or was transferred and all risks and rewards associated with ownership 

were transferred from the Group. 

a) Financial assets valued at fair value via the income statement are valued at 

fair value on a continual basis. 

b) Loan receivables and accounts receivable are reported initially at fair value 

and thereafter at amortized cost less any deductions for impairment provisions. 

Impairment provisions are made when it is apparent that the company 

will not be able to collect the total outstanding amount in accordance 

with the original terms. Group companies with pay TV operations, which 

have end consumers as part of their customer base, make provisions in 

accordance with a pre-determined ladder that has been adapted to the 

conditions of each geographic market. Group companies with network 

activities, which do business with other companies, make provisions based 

on an individual assessment of each customer and receivable. The change 

in the provision is reported in the income statement as a cost of sales. 

c) Investments held to maturity are reported initially at fair value plus transaction 

costs. They are then reported at amortized cost, which is equal to 

the present value of the remaining cash flows using the effective interest 

method. 

Derivative instruments and hedging 

The Group's finance policy only allows derivatives to decrease an underlying 

exposure. Using a derivative for trading or any purpose other than hedging is 

not allowed. Given this restriction, the Group only holds the following types 

of derivatives at the end of the year: 

- Currency derivatives held to hedge future payments and accounts payable 

in foreign currency. These derivatives do not qualify for hedge accounting. 

- A portfolio with electricity derivatives to hedge Swedish electricity price risk 

which constitute a cash flow hedge. 

- A loan in SEK with a variable interest rate that was converted to a DKK 

loan with a variable interest rate using a currency interest rate swap, which 

should hedge the currency risk in the net investment in the Danish subsidiary, 

Teracom A/S. 

- A fixed interest rate swap that hedges the interest rate risk in parts of the 

above-mentioned loans with variable interest rates. 

Derivative instruments are reported in the balance sheet at the contract 

date and at fair value, both initially and following subsequent revaluations. 

The method for reporting gain or loss depends on whether the derivative 

instrument was designated as a hedging instrument and the nature of the 

hedged item. 

When the hedge is entered into, the Group documents the relationship 

between the hedging instrument and the hedged items as well as the company's 

objective for its risk management and the risk management strategy 

for the hedge. The Group also documents, even when the hedge is entered 

into on an ongoing basis, its assessment of whether the derivatives used for 

the hedging transactions are expected to be very effective at neutralizing 

changes in fair value or cash flows attributable to the hedged risk. Changes 

in the hedge reserve are reported under Other comprehensive income in the 

consolidated income statement. 

Cash flow hedging 

The effective portion of the changes in fair value of a derivative instrument 

designated as a cash flow hedge is reported under Other comprehensive 

income. The gain or loss attributable to the ineffective portion is reported 

directly under net financial income in the income statement. For the Group 

this refers to the hedging of electricity price risk and hedging of interest rate 

risk via interest rate swaps. 

69

Hedges of net investments 

Hedges of net investments in foreign operations are reported similarly to cash 

flow hedges. The gain or loss attributable to the effective portion of the hedge 

is reported under Other comprehensive income. Gain or loss attributable to 

the ineffective portion of the hedge is reported under net financial income in 

the income statement. Accumulated gain or loss under Other comprehensive 

income is reported in the profit/loss for the period when the foreign operations, 

or a part of the operations, is divested. For the Group, this refers to 

loans combined with a currency interest rate swap. 

Derivatives not subject to hedge accounting 

Some derivative instruments do not qualify for hedge accounting. For the 

Group, this refers to currency derivatives which hedge future payments and 

accounts payable in foreign currency. 

Inventories 

Inventories are valued at the lower of cost and net realizable value. Cost 

includes all costs incurred in delivering the inventories to their present location 

and condition. Net realizable value is the estimated selling price in the 

ordinary course of business, less the estimated cost of completion and the 

estimated costs necessary to make the sale. The first-in, first-out method 

(FIFO) is applied when determining cost. Any losses associated with inventories 

or adjustments due to write-downs to the net realizable value are recognized 

in the income statement in the period in which they occur. 

Provisions 

Provisions for environmental rehabilitation, restructuring costs and legal 

requirements are reported when the Group has an obligation as a result of an 

occurred event and when it is probable that settlement will require an outflow 

of resources and when the amount can be estimated reliably. The amount 

reported as a provision is the amount that according to the best assessment 

is the amount that will need to be paid to settle the obligation at the balance 

sheet date. Where the time value of money is of significance, the amount has 

been reported at the present value of estimated expenses. Any increase in the 

provision that is based on the passage of time is reported as interest expense. 

Restructuring costs are reported when the Group has both decided on a 

detailed restructuring plan and the main features have been announced to 

affected parties. 

Post-employment remuneration 

Post-employment remuneration is reported in accordance with IAS 19 and 

classified as either a defined benefit or defined contribution plan. 

Defined benefit plans 

A majority of the Group's employees are included in defined benefit pension 

plans, which means that employees are guaranteed a pension corresponding 

to a certain percentage of their final salary. Defined benefit pension plans 

entail that the Group has an obligation to pay contractual benefits to both 

current and former employees. In addition, defined benefit pension plans 

entail that the Group carries both actuarial risk and investment risk. Actuarial 

risk refers to the risk that the benefits will cost more than anticipated. Defined 

benefit pension plans are primarily funded by regular premium payments to 

life insurance companies. 

Employees of Boxer TV-Access AB are entitled to pension benefits in accordance 

with the ITP pension plan, which is a plan that covers many employers 

and is secured through insurance with Alecta. The ITP pension plan is a 

defined benefit plan. However, since the plan assets and obligations may 

not be allocated to each employer, it is thus reported as a defined contribution 

plan in accordance with item 30 in IAS 19. The design of the plan does 

not entitle Alecta to allocate to each employer their share of the assets and 

obligations or the information to which the disclosures apply. Therefore, it is 

reported as a defined contribution plan, which means that paid premiums are 

reported as costs as the benefits are earned. 

The Projected Unit Credit Method (PUCM) is used to determine the present 

value of the Group's pension commitments and expenses. This calculation is 

conducted annually by independent actuaries based on actuarial assumptions 

determined in conjunction with the balance sheet date. 

Changes in the present value of the commitments that are related to 

changed actuarial assumptions are treated as actuarial gains or losses and 

distributed across the employee's average remaining period of employment 

in accordance with the corridor approach. Differences between expected and 

actual returns on the plan's assets are treated as actuarial gains or losses. 

Actuarial gains and losses are reported as income or costs if the accumulated 

actuarial gain or loss exceeds 10 percent of the higher of the value of 

the commitment or the fair value of the plan assets. Any amount in excess of 

that is distributed over the remaining expected period of employment for the 

employee covered by the particular plan. 

The liability reported in the balance sheet for defined benefit pension plans 

is the present value of the commitment on the balance sheet date less the 

fair value of the managed asset, any expenses relating to prior employment 

that have not yet been reported, any actuarial losses not yet reported, and 

increased by any actuarial gains that have not yet been reported. Funded 

plans with net assets, i.e. plans with assets exceeding the commitment, are 

reported as a financial asset. 

Special employer's contribution is calculated as the difference between 

the pension expense determined in accordance with IAS 19 and the pension 

expense determined in accordance with the rules applied in legal entities. Payroll 

tax is reported as a cost in the income statement. 

Defined contribution pension plans 

With regard to defined contribution plans, the company pays a defined fee to 

an independent insurance company and has no legal obligation to pay additional 

fees if this unit does not have sufficient assets to pay all benefits. This 

means that the employee bears the actuarial risk and investment risk. As such, 

no actuarial assumptions are required and neither are there any actuarial 

gains or losses. The fees are expensed when they fall due for payment. 

Loans 

Loans are reported initially at the fair value of the inflow of funds less deductions 

for transactions costs. After the date of acquisition, the loan is valued at 

amortized cost using the effective interest rate method. 

Accounts payable 

Accounts payable are reported initially at fair value. After the date of acquisition, 

accounts payable are valued at amortized cost using the effective interest 

rate method. 

New or changed accounting standards as of 1 January 2011 

None of the IFRS or IFRIC interpretations that are obligatory for initial application 

for financial years starting 1 January 2011 or later are expected to have 

a significant impact on the Group. 

IAS 24 Related Party Disclosures (revised): The revised standard clarifies and 

simplifies the definition of a related party. It also removes the requirement 

on state affiliates to provide detailed disclosures on all transactions with 

the government or other state affiliates. The Group discloses transactions 

between Group companies but no longer discloses transactions with other 

state affiliates. 

IFRIC 14 The Limit on a Defined Benefit Asset, Minimum Funding Requirements 

and their Interaction (amended): The amendment to IFRIC 14 corrects a previous, 

unintentional consequence of the interpretation. According to the previous 

version of IFRIC 14, companies were not allowed in some cases to report 

certain voluntary advance payments of a minimum funding requirement as 

an asset. The amendment does not affect the Teracom Group. 

New or revised accounting standards after 2011 that are judged to 

have an impact on the Teracom Group when they enter into force 

The following standards or amendments were issued by IASB but are not 

applicable to the financial year starting 1 January 2011 and will not be applied 

in advance. 

IAS 19 Employee Benefits (revised): This standard removes the corridor 

approach and all actuarial gains or losses should be immediately reported 

under Other comprehensive income as incurred. Costs for employment from 

prior years will be reported on an ongoing basis. Interest expenses and expected 

return on plan assets will be replaced by net interest, which is calculated 

using the discount rate based on the net surplus and net deficit in the defined 

benefit pension plan. Teracom intends to apply the amended standard for the 

financial year starting 1 January 2013 and evaluate the effect during 2012. IAS 

19 enters into force on 1 January 2013 but has not yet been adopted by the EU. 

IFRS 9 Financial Instruments addresses the classification, valuation and 

accounting of financial liabilities and assets. IFRS 9 was issued in November 

2009 for financial assets and October 2010 for financial liabilities and replaces 

the parts of IAS 39 that are related to the classification and measurement of 

financial instruments. IFRS 9 states that financial assets should be classified 

as one of two categories: fair value or amortized cost. The classification is 

made at the time the financial asset is initially recognized based on the company's 

business model and the characteristics of the contractual cash flows. 

70

No major changes will be made for financial liabilities compared to IAS 39. 

The most significant change relates to liabilities identified at fair value. The 

portion of the change in fair value that is attributable to the credit risk of the 

liability should be reported in Other comprehensive income instead of profit 

or loss as long as this does not create a recognition inconsistency (accounting 

mismatch). The Group intends to apply the new standard no later than the 

financial year starting 1 January 2013 and has not yet evaluated the effects. 

The standard has not yet been adopted by the EU. 

IFRS 10 Consolidated Financial Statements: This standard defines the term 

"deciding influence" and builds on existing principles by identifying controls 

as the determining factor in whether a company should be included in the 

consolidated financial statements. The standard provides additional guidance 

to assist in the determination of control where this is difficult to assess. 

Given the current ownership structure of the Group, the new standard will 

not affect the Group's reporting. IFRS 10 enters into force on 1 January 2013 

but has not yet been adopted by the EU. 

IFRS 12 Disclosures of Interests in Other Entities: The standard covers disclosure 

requirements for subsidiaries, joint arrangements, associated companies 

and unconsolidated structured entities. The Group intends to apply IFRS 12 

to the financial year starting 1 January 2013 and has not yet evaluated the 

full effect on the financial statements. IFRS 12 enters into force on 1 January 

2013 but has not yet been adopted by the EU. 

IFRS 13 Fair Value Measurement: The purpose of the standard is to make the 

fair value measurements more consistent and less complicated by providing 

an exact definition and a single source within IFRS for fair value measurements 

and related disclosures. The requirements do not expand the area of 

application for when fair value should be applied, but rather provide guidance 

with regard to how it should be applied when other IFRS already require or 

allow fair value measurements. The Group has not yet evaluated the full effect 

of IFRS 13 on the financial statements. The Group intends to apply the new 

standard to the financial year starting 1 January 2013. The standard has not 

yet been adopted by the EU. 

Use of estimated values 

In the preparation of the annual report in accordance with IFRS, Group management 

has used assumptions and estimates in the reporting of assets and 

liabilities. Discussed below are those areas where there is the greatest risk for 

changes in value during the following year due to a potential need to revise 

prior assumptions or estimates. 

Transactions with minority owners 

The Teracom Group owns a majority of the shares in the Finnish pay TV operator, 

Digi TV Plus Oy. In conjunction with the acquisition in 2009, Teracom also 

issued a put option over the remaining minority shares and Teracom also has 

a call option to acquire the same shares. The commitment related to the put 

option is included in the total acquisition cost. The liability was reported at 

fair value based on Teracom's best assessment of what it will have to pay for 

the outstanding equity stake. The future payment of the outstanding equity 

stake is based on the company's future results and it may be adjusted if the 

assumptions underlying Teracom's assessment change. The option's interest 

rate effect and currency effect are reported in the income statement on an 

ongoing basis. 

Impairment of assets 

Non-current asset such as goodwill are reviewed each year to determined 

the impairment requirement or when events and changes occur that indicate 

the carrying amount of an asset cannot be recovered. Company management 

regularly conducts a revaluation of the useful life of all tangible and 

intangible assets. It is the opinion of the company's management team that 

reasonable changes to the factors forming the basis for the estimation of the 

assets' recoverable amounts would not result in the carrying amount exceeding 

the recoverable amount. 

Accounts receivable 

Receivables are reported net after reserves for doubtful debts. The amount 

is based on circumstances known at the balance sheet date. Changed conditions, 

for example that payments in default increase in scope or the financial 

position of a significant customer changes, can result in significant deviations 

from the valuation. 

Post-employment remuneration 

The Teracom Group has both defined benefit pension plans and defined contribution 

pension plans. The defined benefit plans entail actuarial risk and 

investment risk for the Group. Actuarial calculations of pension commitments 

and pension expenses are based on a number of assumptions, such as the 

discount rate, anticipated salary increases, anticipated remaining periods of 

employment and anticipated return on plan assets. A change in any of these 

fundamental assumptions could have a significant impact on calculated pension 

commitments, financing requirements and pension expenses. 

Restructuring costs 

Restructuring costs include required impairment of assets and other items 

that do not affect the cash flow, such as estimated costs for notices of termination 

and other direct costs related to the phasing out of operations. The 

cost calculation is based on detailed action plans that are expected to improve 

the Group's cost structure. 

Accounting principles for the Parent Company 

The Group’s and the Parent Company's financial statements and terminology 

differ since the Group applies IAS 1 and the Parent Company applies RFR 2 

September 2011 and the Annual Accounts Act (1995:1554). The Parent Company 

is limited in its ability to fully apply IFRS. These limitations are associated 

with the Parent Company's application of RFR 2, the Annual Accounts Act and 

the Parent Company's tax regulations. 

Participations in subsidiaries 

Participations in subsidiaries are reported in accordance with the cost method. 

The value of the participations is tested when there are indications that 

the value has depreciated. 

Anticipated dividends 

Dividends from Group companies are reported in the income statement after 

a decision regarding dividends is made at each subsidiary's Annual General 

Meeting. Anticipated dividends are reported when the Parent Company unilaterally 

has the right to decide on the size of the dividends and the Parent 

Company has decided on the size of the dividends before it published its 

annual report or quarterly reports. 

Shareholder contributions and Group contributions 

Group contributions paid from the Parent Company to subsidiaries are reported 

in the Parent Company in the same manner as shareholder contributions. 

Shareholder contributions are reported directly against the recipient's equity 

with a corresponding increase in "Participations in Group companies" by the 

contributor. Alternatively, the Group contribution may be reported as a cost in 

the income statement. Group contributions received from subsidiaries should 

always be reported in the Parent Company as financial income in the same 

manner as a dividend. 

Leases 

All lease agreements are reported in the Parent Company according to the 

rules that apply for operating leases. 

Valuation of financial instruments 

Unlike the Group, the Parent Company does not adjust financial instruments 

to fair value. 

Deferred taxes 

The Teracom Group's deferred tax assets are primarily attributable to loss 

deductions and temporary differences and these are reported if the tax assets 

are expected to be recoverable via future taxable income. Changes to the 

assumptions regarding future taxable income, or changes to tax rates, can 

lead to significant changes in the valuation of deferred taxes. 

71

Note 2. Operating income 

Note 3. Leasing 

Net sales by revenue category 

Group 

Parent 

Company 


Revenue category 2011 2010 2011-12-31 

Service assignments 4 046 3 848 33 

Total 4 046 3 848 33 

Net sales for the Group includes income from operating leases in the amount of 

SEK 281 (187) million. 

Group 

Parent 

Company 

Other income/other 2011-06-01 

operating income 2011 2010 2011-12-31 

Exchange gains on receivables or 

payables from operating activities 

2 4 0 

Gains on disposal of equipment 2 0 0 

Other 9 0 0 

Total 13 4 0 

Exchange gains on receivables or payables from operating activities 

These are primarily exchange gains on accounts payable. 

Other 

Primarily attributable to market contributions from program companies. 

Leases where the lessor retains substantially all of the risks and rewards incident 

to ownership are classified as operating leases. 

The Teracom Group as lessor in operating lease agreements 

The Group's income from operating leases is reported as part of net sales in the 

income statement. This income primarily comes from co-locations. The Teracom 

Group has a nationwide network in Sweden and Denmark of strategically 

located masts and stations with high performance and radio coverage. 

Group 

Minimum lease 

payments 

Maturity date 2011 2010 

Within one year 205 194 

More than one year, but less than five years 262 379 

More than five years 2 3 

Total 469 576 

The Teracom Group as lessee in operating lease agreements 

The Group has operating lease agreements primarily relating to commercial 

rental contracts for premises for offices and technical equipment, co-location 

contracts and communication contracts. For the remaining term, these contracts 

are non-cancelable. 

The majority of leasing contracts have terms such that indexing of the 

minimum lease payments according to established indexation is possible. The 

future minimum lease payments that are required according to non-cancelable 

operating lease agreements are as follows: 

Group 

Minimum lease 

payments 

Maturity date 2011 2010 

Within one year 44 52 

More than one year, but less than five years 59 64 

More than five years 24 26 

Total 127 142 

For the 2011 financial year, total operating lease expenses were SEK 112 (105) 

million. 

The Teracom Group as lessee in financial lease agreements 

The Group leases certain items of property, plant and equipment, such as service 

vehicles, company cars and other vehicles. 

Leasing agreements pertaining to fixed assets, where the Group retains 

substantially all of the risks and rewards incident to ownership, are classified 

as financial leases. At the inception of the lease, financial leases are reported 

in the balance sheet at the leased asset's fair value or the present value of the 

minimum lease payments (whichever is lower). 

Adjustments to financial lease agreements for depreciation and disposals 

amounted to SEK 0 (1) million. 

72

Note 4 Segment reporting 

The Group management team has established operating segments based on 

the information used to make strategic decisions. The operating segments are 

responsible for the operating profit and the working capital that they manage. 

The Parent Company with Group functions is reported on the line "Other". 

These function-based departments have income of insignificant amounts, 

which is why they are not considered to be separate operating segments (in 

accordance with IFRS 8). For sales between segments, market terms and market 

prices are used. 

Operating income 

Group operating segments, 

SEK million 

2011 2010*) 

Teracom Sweden 1 478 1 473 

Boxer Sweden 2 011 2 041 

Teracom Denmark 345 92 

Boxer Denmark 266 158 

Plus TV 556 582 

Other 60 7 

Group adjustments -657 -501 

Total 4 059 3 852 

*) Comparable figures for the full-year 2010 were adjusted in accordance with 

new principles for operational follow-up. 

Operating profit/loss 


SEK million 

2011 2010*) 

Teracom Sweden 469 472 

Boxer Sweden 278 331 


Boxer Denmark -260 -297 

Plus TV -72 -81 

Other -54 -83 

One-off effects -36 -47 

Group adjustments -15 -23 

Total 376 293 

*) Comparable figures for the full-year 2010 were adjusted in accordance with 

new principles for operational follow-up. 

Assets / Liabilities Assets Liabilities 

Group operating segments, SEK million 2011 2010 2011 2010 

Teracom Sweden 3 422 5 447 1 851 2 662 

Boxer Sweden 1 030 631 874 491 

Teracom Denmark 1 453 1 842 149 340 

Boxer Denmark 346 123 602 227 

Plus TV 159 104 293 166 

Other 6 045 - 4 183 - 

Group adjustments -6 902 -2 449 -4 502 -294 

Total 5 553 5 698 3 450 3 592 

Investments 


SEK million 

2011 2010 

Teracom Sweden -288 -245 

Boxer Sweden -24 -29 

Teracom Denmark -18 -2 


Plus TV -2 -8 

Total -332 -284 

Depreciation/amortization 


SEK million 



Boxer Sweden -33 -28 

Teracom Denmark -90 -21 

Boxer Denmark -1 -1 

Plus TV -8 -10 

Other -17 -14 

Total -404 -331 

Impairment 


SEK million 



Boxer Sweden 0 -3 



Plus TV -12 0 

Other 0 -5 

Total -19 -18 

Geographic information 

Income from external customers, SEK million 2011 2010 

Sweden 2 936 2 980 

Finland 588 616 

Denmark 481 221 

Other countries 54 35 

Total 4 059 3 852 

The Group's property, plant and equipment and intangible assets, not including 

Group surplus values, are distributed to each respective country in the 

table below. 

Fixed assets, SEK million 2011 2010 

Sweden 1 731 1 714 

Finland 19 36 

Denmark 1 357 1 480 

Total 3 107 3 230 

Note 5. Work performed by the company 

for its own use and capitalized 

Work performed by the company for its own use and capitalized consists 

of labor costs that are directly related to investments in property, plant and 

equipment. 

73

Note 6. Employees and remuneration 

Group Parent Company 

Salaries, other remuneration 

and social security expenses, 

SEK thousand 2011 2010 2011 2010 

Board members, President/CEO, 

Executive Vice President/CFO and 19 119 14 502 10 705 - 

senior executives 

Other employees 388 427 349 698 17 836 - 

Total salaries and remuneration 407 546 364 200 28 541 - 

Social security expenses 113 220 112 852 11 696 - 

Pension expenses, defined benefit 

plans 

21 137 25 915 1 990 - 

Pension expenses, defined contribution 

pensionplans 

52 785 49 523 13 043 - 

Other personnel expenses 19 519 18 155 1 906 - 

Total personnel expenses 614 207 570 645 57 176 - 

Of the Group's pension expenses, SEK 3,745 (1,468) thousand was for the 

Boards of Directors or persons with the title of president, managing director 

or executive vice president within the Group. Outstanding pension obligations 

to these individuals are SEK 0 (0) thousand. 

Of the Parent Company's pension expenses, SEK 1,666 (0) thousand was 

for the Boards of Directors or persons with the title of president, managing 

director or executive vice president within the Group. 

No bonuses or comparable remuneration have been paid to the Group 

management team, Board members or persons with the title of president, 

managing director or executive vice president within the Group. 

Remuneration to senior executives 

Principles 

Teracom Group AB's Board of Directors is responsible for appointing the 

President/CEO and establishing the terms of employment. The Board of Directors 

complies with Government guidelines regarding remuneration to senior 

executives. 

Senior executives include persons that belong to, or have belonged to, the 

Group management team. The Group management team consists of 36 (30) 

percent women. 

The company's President/CEO and Executive Vice President each receive 

a market-competitive salary, premium-based pension benefits in addition to 

what is stipulated in the Swedish National Insurance Act, health insurance, a 

company car, individually negotiated terms for termination of employment 

and severance pay. Senior executives refers to the 11 (9) persons in the Group 

who, at some point during 2011 belonged to the Group management team, 

excluding the President/CEO and Executive Vice President. All pension plans 

for senior executives are vesting. Senior executives in the subsidiaries are the 

Presidents of each company. 

President/CEO Crister Fritzson and Executive Vice President Gunilla Berg 

have also been assured of pension benefits corresponding to monthly pension 

premium payments amounting to 30 percent of their base salary. The retirement 

age for the President/CEO and Executive Vice President is 65. 

Remuneration and benefits paid in 2011 to senior executives, SEK thousand 

Other 

Position Name Basic salary 

remuneration 

and benefits Total 

Pension 

expense Notice period Severance pay 

Group CEO and President of Teracom Group AB Crister Fritzson 2 844 291 3 135 896 6 months 18 months 

Executive Vice President of Teracom Group AB Gunilla Berg 2 400 144 2 544 770 6 months 12 months 

Senior executives 11 persons 11 668 855 12 523 3 581 

Total 16 912 1 290 18 202 5 247 

Remuneration and benefits paid in 2010 to senior executives, SEK thousand 

Other 

Position Name Basic salary 

remuneration 

and benefits Total 

Pension 

expense Notice period Severance pay 

Group CEO and President of Teracom AB Crister Fritzson 2 760 313 3 073 896 6 months 18 months 

Executive Vice President of Teracom AB 

Gunilla Berg 

Started on 2010-11-01 

400 5 405 0 6 months 12 months 

Senior executives 9 persons 9 365 779 10 144 3 210 

Total 12 525 1 097 13 622 4 106 

Comments about the table 

- Remuneration to the President/CEO, Executive Vice President and other 

senior executives consists of a base salary, other benefits and a pension. 

- All amounts are excluding social security contributions and payroll tax. 

- Base salary refers to the fixed monthly salary. 

- Other remuneration and benefits refers to vacation pay, deductions/benefits 

for absence due to illness, parental leave deductions/benefits, subsidized 

lunch coupons, company cars, increased salary in lieu of a company car, 

fuel and parking benefits (only for senior executives that have opted out of 

having a company car). 

- Pension expenses also include health insurance for the President/CEO and 

other senior executives. 

- The stated notice period is for termination initiated by the company. 

- The Group's auditors have conducted a special review of remuneration to 

senior executives. 

74

Notice period and severance pay 

The remuneration to the President/CEO for the 2011 financial year was established 

by the Board of Directors. Remuneration to other senior executives was 

decided by the President/CEO in consultation with the Chairman of the Board. 

Between the Company and the President/CEO, Crister Fritzson, a notice period 

of six months applies, regardless of whether termination is initiated by the 

Company or by the President. 

If employment termination is initiated by the Company, the President/CEO 

receives severance pay in accordance with the above table. A clarification has 

been made that severance pay is only calculated using the fixed portion of the 

monthly salary. Severance pay is offset against other income. 

If employment termination is initiated by the President, there is accordingly 

no severance pay. The same terms apply to the Executive Vice President. 

Board remuneration 

The Chairman of the Board and the Board members receive an annual fee that 

is decided at the Annual General Meeting. For the Chairman, the annual fee 

was SEK 190 (190) thousand and for Board members, the annual fee was SEK 

95 (95) thousand. A fee is paid for participation in the audit committee in the 

amount of SEK 60 (60) thousand to the Chairman and SEK 30 (30) thousand 

to each committee member. A fee is paid for participation in the remuneration 

committee in the amount of SEK 30 (30) thousand to the Chairman and SEK 

15 (15) thousand to each committee member. This fee is not based on the calendar 

year, rather, the period May through April. In addition, Board members 

are compensated for expenses arising in conjunction with company business. 

Remuneration paid to Åsa Sundberg, Chairman of the Board, was SEK 220 

(210) thousand. Apart from the fee that the Annual General Meeting established 

for Board members and the fee that the Board of Directors established 

for employee representatives on the Board, no remuneration was paid in 2011. 

The Board of Directors consists of 50 (57) percent women. 

Remuneration to Board of Directors in 2011, SEK thousands 

Position Name Comment Board fee Other remuneration 

Chairman of the Board Åsa Sundberg 190 30 

Board member Kristina Axberg Bohman 95 60 

Board member Maria Curman 95 15 

Board member Ingrid Engström 95 15 

Board member Lars Grönberg 95 30 

Board member Johan Hallberg Started on 01.06.11 0 0 

Board member Tobias Henmark Left on 01.06.11 8 1 

Board member Urban Lindskog 95 30 

Board member Nils Petter Tetlie Started on 22.03.11 63 0 

Employee representative Magnus Ahxner 0 0 

Employee representative John-Olof Blomkvist 0 0 

Employee representative Claes-Göran Persson Left on 01.06.11 0 0 

Employee representative, deputy Stig-Arne Celin 0 0 

Employee representative, deputy Niklas Hanson Started on 01.06.11 0 0 

Total 736 181 

Remuneration to Board of Directors in 2010, SEK thousands 

Position Name Comment Board fee Other remuneration 

Chairman of the Board Åsa Sundberg 190 20 

Board member Kristina Axberg Bohman 95 60 

Board member Maria Curman 95 10 

Board member Ingrid Engström 95 10 

Board member Lars Grönberg 95 20 

Board member Tobias Henmark 32 13 

Board member Urban Lindskog 95 33 

Employee representative John-Olof Blomkvist 12 0 

Employee representative Claes-Göran Persson 5 0 

Employee representative, deputy Magnus Ahxner Started on 31.03.10 0 0 

Employee representative, deputy Stig-Arne Celin 0 0 

Employee representative, deputy Stefan Thylander Left on 31.03.10 0 0 

Total 714 166 

Average number of employees broken down by geographic location and gender 


Average number of employees Total Men % Women % Total Men % Women % 

Sweden 577 77% 23% 580 76% 24% 

Denmark 99 77% 23% 98 79% 21% 

Finland 31 39% 61% 29 52% 48% 

Total in the Group 707 75% 25% 707 76% 24% 

75

Note 7. Pensions 

A majority of the Group's employees are primarily covered by defined benefit 

pension plans, which means that they are guaranteed a pension that corresponds 

to a certain percentage of their salary. The pension plans include 

a retirement pension, a disability pension and a survivor pension. Employees 

of Boxer TV-Access AB are entitled to pension benefits in accordance with 

the ITP pension plan, which is secured through insurance with Alecta. Other 

employees within the Group in Sweden are covered by the ITP-Tele pension 

plan. Pension obligations are calculated annually as per the reporting date, 

based on actuarial assumptions. Pension obligations are secured through provisions 

in the balance sheet and through insurance premiums. 

In Finland, employees are entitled to statutory pensions benefits in accordance 

with Finnish legislation on pensions for employees, a defined benefit 

pension plan (TEL pension). Pension benefits are secured through insurances 

and they are not covered by IAS 19. Employees in Denmark are covered by 

a defined contribution pension plan. Pension benefits are secured through 

insurances. 

In addition to the ITP plan, there is a pension liability that Teracom AB 

assumed from the former Swedish PTT when it was incorporated in 1992. 

The liability consists of a non-vesting portion and a vesting portion. The nonvesting 

portion was terminated on 2011-12-31 since all employees with this 

type of agreement retired in 2011. The remaining vesting portion refers to 

retirement pensions. Employees hired after incorporation have an insuranceonly 

solution as of 65 years of age. Retirement pensions to employees who 

have been invited to take early retirement are secured through provisions in 

the balance sheet or insurances and are paid as a retirement pension until the 

person reaches 65 years of age. 

Actuarial gains and losses are taken up as income over the employee’s 

remaining period of employment to the extent that the total gain or loss per 

plan falls outside the 10 percent corridor corresponding to the higher of the 

pension obligation or the fair value of the plan assets for each plan, respectively. 

The cost related to service during the current year refers to the capital 

value of earned pension benefits during the year as calculated by the Projected 

Unit Credit Method. 

Total pension expenses are distributed as follows: 

Group 

Pension expense for the period 2011 2010 Forecast 2012 

Cost related to service during the current year 7 11 9 

Interest expense 20 18 19 

Expected return on plan assets -13 -12 -13 

Change in asset reduction (IAS 19.58b) -25 27 0 

Actuarial profit/loss (+/-) to report for the year 28 -22 4 

Cost regarding service from prior periods 1 0 0 

Total cost for defined benefit plans 18 22 19 

Pension expense to report in the income statement 18 22 19 

Other effects to report in the income statement 

Reductions, profit/loss (-/+) -1 -9 0 

Total -1 -9 0 

Detailed description of pension obligations and pension expense 

Pension obligations, plan assets and receivables/provisions for pension obligations 

as well as actuarial gains/loss for defined benefit pension plans have 

developed as follows: 

Group 

Pension liability 2011 2010 Forecast 2012 

Present value of wholly or partially funded obligations (+) 485 389 498 

Fair value of plan assets -439 -424 -452 

Net value of wholly or partially funded obligations (+/-) 46 -35 46 

Present value of unfunded obligations (+) 4 8 1 

Present value of net obligation (+/-) 50 -27 47 

Unaccounted actuarial gain/loss (+/-) -111 -51 -106 

Effect of the limitation rule for net assets 2 27 1 

Pension liability/asset to report in the balance sheet -59 -51 -58 

Present value of defined benefit plans 2011 2010 Forecast 2012 

Present value of the obligation on 1 January 397 494 489 

Cost related to service during the current period 7 11 9 

Interest expense 20 18 19 

Paid remuneration -19 -21 -18 

Cost regarding service from prior periods 1 0 0 

Reductions and adjustments -1 -10 0 

Actuarial profit/loss on the obligation (+/-) 84 -95 0 

Present value of the obligation on 31 December 489 397 499 

76

Return on plan assets 2011 2010 Forecast 2012 

Expected return on plan assets 13 12 13 

Actuarial profit/loss on the plan assets (+/-) -4 8 0 

Actual return on plan assets 9 20 13 

Plan assets 2011 2010 Forecast 2012 

Fair value of plan assets on 1 January 424 401 439 

Expected return on plan assets 13 12 13 

Fees/premiums (+) 20 16 16 

Paid remuneration (-) -14 -13 -16 

Actuarial profit/loss (+/-) on plan assets -4 8 0 

Fair value of plan assets on 31 December 439 424 452 

Reconciliation of change in pension liability 2011 2010 Forecast 2012 

Net liability/asset on 1 January -51 -40 -59 

Pension expense for the period 18 22 19 

Paid remuneration (-) -19 -21 -18 

Fees, premiums (-) -20 -16 -16 

Reimbursement (+) 14 13 16 

Reductions and adjustments -1 -9 0 

Net liability/asset on 31 December -59 -51 -58 

2011 2010 Forecast 2012 

Accumulated unaccounted actuarial profits /losses (+/-) on 1 January -51 -133 -111 

Reported actuarial profits/losses (+/-) during the year 28 -22 5 

Profit/loss (+/-) on obligation -84 95 0 

Profit/loss (+/-) on plan assets -4 8 0 

Profit/loss (+/-) on reductions and adjustments 0 1 0 

Accumulated unaccounted actuarial profits /losses (+/-) on 31 December -111 -51 -106 

Number entitled to pension on 1 January 2011 2010 Forecast 2012 

Employees 504 512 519 

Vested benefits 743 729 786 

Retired persons 256 228 286 

Total 1 503 1 469 1 591 

Five-year overview 2011 2010 2009 2008 2007 

Present value of the obligation (+) 489 397 494 454 478 

Fair value of plan assets (-) -439 -424 -401 -371 -358 

Present value of net obligation (+/-) 50 -27 93 83 120 

Profit/loss (+/-) on the obligation, actual effects -4 7 -22 7 -7 

Profit/loss (+/-) on plan assets, actual effects -4 8 -11 -14 3 

Plan assets 2011 2010 2009 2008 2007 

Insurance contract 439 424 401 371 358 

The annual fees for pension insurance with Alecta (reported as a defined 

contribution plan) were SEK 2 (3) million. Alecta's surplus may be distributed 

amongst the policy holder(s) and/or the insured. As of 31 December 2011, 

Alecta's surplus in the form of the collective funding ratio amounted to 113 

(146) percent. The collective funding ratio was calculated in accordance with 

IAS19. 

Actuarial assumptions 

The actuarial calculation of the Group’s pension obligations and pension costs 

is based on the following key assumptions stated as weighted averages for 

the various pension plans. A change in any of these fundamental assumptions 

can have a significant impact on calculated pension obligations, financing 

requirements and pension costs. 

Forecast 

Actuarial assumptions 2011 2010 2012 

Discount rate (%) 3,90 5,00 3,90 

Annual salary increase (%) 3,00 3,00 3,00 

Increase in the income base amount (%) 3,00 3,00 3,00 

Inflation/annual increase in pension benefits (%) 2,00 2,00 2,00 

Termination rate (%) 3,00 3,00 3,00 

Expected remaining term of service (years) 17,8 18,8 17,2 

Expected return on plan assets (%) 3,00 3,00 3,00 

Discount rate 

The interest rate used to discount both funded and unfunded obligations for 

post-employment remuneration. When establishing the discount rate, consideration 

is given to the market yield on mortgage bonds with the same maturities 

as the obligation as of the balance sheet date. 

Annual salary increase 

The assessment of the annual salary increase reflects anticipated future salary 

increases as a combined effect of inflation, period of service, promotion and 

other relevant factors such as supply and demand in the labor market. 

Increase in the income base amount 

The income base amount, set annually, is used to determine the pensionable 

income ceiling in the national pension system. The assessment is based on the 

anticipated rate of inflation and historical salary trend of the entire labor market. 

Inflation/annual increase in pension benefits 

The assumption is based upon the expected rate of inflation in the market. 

Termination rate 

Historical information has been used in order to make an assessment of the 

termination rate. Teracom has used this information to estimate the future 

termination rate. 

Expected remaining term of service 

The average expected remaining term of service. This calculation is based 

upon the age distribution for employees and the expected future rate of 

employee turnover. 

Expected return on plan assets 

The assessment is based on the average expected return on existing and 

future plan assets. 

77

Note 7 (cont'd) 

Note 10. Other costs 

Mortality rate 

Assumptions regarding the mortality rate are in accordance with the Swedish 

Financial Supervisory Authority's regulation, DUS06 (DUS06). 

Parent Company 

The Parent Company Teracom Group AB does not carry a pension liability in 

its balance sheet. The only pension liability in the Group is reported by the 

subsidiary Teracom AB, which was the Parent Company of the Group until 

June 2011. 

Note 8. Depreciation/amortization 

The Group's other expenses amounted to SEK -1,034 (-969) million. The comparison 

figures are adapted to the higher degree of detail in the income statement. 

The largest expense item is costs for customer service. In the Parent 

Company, other external expenses for the year were SEK -13 (-) million. 


Exchange losses on receivables/payables 

from operating activities 2011 2010 



Exchange losses on accounts payable -4 -11 0 

Total -4 -11 0 

Group net exchange rate differences from operating activities amounted to 

SEK -1 (-7) million. 

Parent Company net exchange rate differences from operating activities 

amounted to SEK 0 (-) million. 

Tangible and intangible fixed assets are depreciated/amortized systematically 

over the estimated useful life of the asset. Useful life refers to the period 

during which the asset is expected to be used for its intended purpose in the 

Group. Land is not depreciated, since its useful life is unlimited. Goodwill and 

trademarks are not amortized because it is not possible to estimate useful life. 

An assessment of the residual value and useful life is performed on each 

balance sheet date, and an adjustment is made if necessary. During 2011, no 

changes have been made to the lengths of useful lives. 

Depreciation/amortization according to type of asset 

Group 

Assets 2011 2010 

Depreciation on buildings and land -40 -19 

Depreciation on plant and machinery -277 -235 

Depreciation on equipment, tools, fixtures and fittings -20 -18 

Amortization on licenses and similar rights -50 -47 

Amortization of customer agreements -6 -2 

Amortization of customer relationships -11 -10 

Total -404 -331 

Note 9. Impairment 

Note 11. Remuneration to auditors 

Group 

Remuneration to auditors 2011 2010 




PwC 

- Audit engagement -3 -2 -1 

- Audit activities in addition to 

the audit assignment 

0 0 0 

- Tax consultation 0 0 0 

- Other services 0 0 0 

Total -3 -2 -1 

Note 12. Financial income and 

financial expenses 

Group 

Assets 2011 2010 

Amortization on patents, licenses and similar rights -12 -18 

Impairment loss on plant and machinery -7 0 

Total -19 -18 

Impairment losses for the year on intangible assets amounted to 

SEK -12 million and were attributable to the Plus TV segment. 

Impairment losses for the year on property, plant and equipment amounte d 

to SEK -7 million and were attributable to the Teracom Sweden segment. 

Impairment losses in the corresponding period last year, SEK -18 million, 

were related to intangible assets, SEK -10 million within the Teracom Sweden 

segment, SEK -3 million within the Boxer Sweden segment and SEK -5 million 

for Group surplus value. 

Group 


Financial income 

Interest income 9 5 

Other financial income 18 32 

Total financial income 27 37 

Financial expenses 

Interest expenses -58 -23 

Other financial expenses -20 -26 

Total financial expenses -78 -49 

The net exchange rate differences from financing activities were SEK 0 (22) 

million for the Group and are reported in other financial expenses. The net 

amount for the Parent Company was SEK -2 (-) million. 




Financial income 

Net profit/loss on participations in Group companies 

- Dividend 297 

- Capital gains (losses) 0 

Exchange rate differences 22 

Interest income 2 

Total financial income 321 

Financial expenses 

Interest expenses -11 

Other financial expenses -72 

Total financial expenses -83 

78

Note 13. Tax on profit for the year 

Group 


2011 2010 2011 2010 

Current tax 

- Sweden -169 -158 0 0 

Total current tax -169 -158 0 0 

Change in deferred tax - temporary differences 12 78 25 0 

Total tax -157 -80 25 0 

Tax was calculated using the applicable tax rates, based on the taxable net profit for the financial year. 

Group 


Tax, % Net profit/loss Tax, % Net profit/loss 

Profit (loss) before taxes 325 281 

Tax according to tax rate in Sweden (26.3 %) -26,3 -85 -26,3 -74 

Difference between the tax rate in Sweden and abroad -1 -3 -1 -4 

Tax effect of non-deductible expenses 

Other non-deductible expenses -1 -3 -3 -8 

Tax effect of non-taxable income 

Other non-taxable income 0 0 2 5 

Tax effect of non-utilized deficit deduction -21 -67 -8 -21 

Tax effect of deficit deduction 0 0 9 26 

Tax on fictitious income related to opening balance of tax allocation fund -1 -4 -1 -4 

Adjustment of tax prior year's taxation 2 5 0 0 

Tax expense and effective tax rate for the financial year 48,3% -157 -28,4% -80 



Tax, % Net profit/loss Tax, % Net profit/loss 

Profit/loss before appropriations 201 - 

Profit (loss) before taxes 201 - 

Tax according to tax rate in Sweden (26.3 %) -26,3 -53 - - 

Tax effect of non-taxable income 

Other non-taxable income 39 78 - - 

Tax expense and effective tax rate for the financial year 12,7% 25 - - 

Note 14. Disclosures concerning closely related parties 

The Swedish State owns 100 percent of the shares in Teracom Group AB. The 

parent company has relationships with closely related parties that entail a 

controlling influence in its Group companies, see note 26. The parent company 

in 2010 was Teracom AB; in 2011 the new formed Teracom Group AB 

was the parent company. The Teracom Group’s services are offered to closely 

related companies at normal commercial terms. The following transactions 

were conducted with closely related companies: 

Parent Company Teracom Group AB's sales and purchases of goods and 

services with subsidiaries 


Subsidiaries Sales Purchasing 

Teracom AB 18 3 

Boxer TV-Access AB 8 0 

Teracom A/S 1 0 

Boxer TV A/S 3 0 

Digi TV Plus Oy 3 0 

Total 33 3 

Parent Company Teracom Group AB's outstanding receivables and 

liabilities to subsidiaries 


Subsidiaries 

Receivables Liabilities 

Teracom AB 0 1 493 

Boxer TV-Access AB 1 695 

Teracom A/S 1 65 

Boxer TV A/S 373 0 

Digi TV Plus Oy 136 45 

Teracom Mast AB 0 1 

Teracom Mobile TV AB 0 0 

Total 511 2 299 

Senior executives 

Remuneration to the Board of Directors, Group CEO/President and senior 

executives is described in note 6. 

79

Note 15. Property, plant and equipment 

Land and buildings 2011 2010 

Opening cost, 1 January 1 163 573 

- Acquisitions 0 586 

- Adjustment of acquisition balance/reclassification from intangible assets 20 - 

- Investments 11 11 

- Reclassifications 0 3 

- Exchange rate differences -2 -10 

Closing accumulated cost, 31 December 1 192 1 163 

- Opening depreciation, 1 January -392 -373 

- Adjustment of acquisition balance/reclassification from intangible assets -6 - 

- Depreciation for the year -40 -19 

- Exchange rate differences 1 0 

Closing accumulated depreciation, 31 December -437 -392 

Closing carrying amount, net, 31 December 755 771 

Group 

Plant and machinery 2011 2010 

Opening cost, 1 January 5 216 4 281 


- Adjustment of acquisition balance -2 - 


- Sales/disposals -390 -40 

- Reclassification from work in progress 173 135 

- Exchange rate differences -2 -15 

Closing accumulated cost, 31 December 5 011 5 216 

- Opening depreciation -3 145 -2 949 

- Sales/disposals 388 39 


- Exchange rate differences -1 0 

Closing accumulated depreciation, 31 December -3 035 -3 145 

- Opening impairment losses, 1 January 0 -2 

- Reclassifications 0 2 

- Impairment losses for the year -7 0 

Closing accumulated impairment losses, 31 December -7 0 

Closing carrying amount, net, 31 December 1 969 2 071 

Equipment, tools, fixtures and fittings 2011 2010 

Opening cost, 1 January 373 358 


- Adjustment of acquisition balance 2 - 


- Sales/disposals -23 -9 


Closing accumulated cost, 31 December 365 373 

- Opening depreciation, 1 January -338 -328 

- Adjustment of acquisition balance 1 - 

- Sales/disposals 23 8 



Closing accumulated depreciation, 31 December -334 -338 

- Opening impairment losses, 1 January -2 0 

- Reclassifications 2 -2 

- Impairment losses for the year 0 0 

Closing accumulated impairment losses, 31 December 0 -2 


Group 

Group 

Construction-in-progress 2011 2010 

Opening cost, 1 January 164 115 


- Sales 0 -2 

- Reclassifications -173 -141 


Investment projects and the inventory of spare parts related to investment projects are for construction-in-progress. 

Group 

80

Note 16. Goodwill and other intangible assets 

Goodwill and intangible assets with uncertain useful life 

Goodwill as of 31 December 2011 had a carrying amount of SEK 1,181 million. 

In addition, the right to use the brand Plus TV in Finland, which was acquired 

in June 2009, was assigned an uncertain useful life. This right has a carrying 

amount of SEK 73 million. Goodwill is allocated to the Group's cash-generating 

units that have been identified by operating segment in accordance with 

the table below. 



SEK million Goodwill Brand 

Intangible 

assets with 

uncertain 

useful life 

Teracom Sweden 0 - 0 

Boxer Sweden 818 - 818 

Teracom Denmark 110 - 110 

Boxer Denmark 0 - 0 

Plus TV 253 73 326 

Total 1 181 73 1 254 

The Teracom Group's goodwill and intangible assets that have an uncertain 

useful life are not amortized. Rather, they are tested annually for impairment. 

When testing for impairment, the recoverable amount for each cash generating 

unit (CGU) is calculated. The recoverable amount is either the fair value or 

the value-in-use of the CGU (whichever is higher). 

The recoverable amount of a CGU has been established based on calculations 

of the value-in-use. These calculations are derived from an estimation 

of future cash flows, based on the most recent financial business plans that 

have been approved by the Group management team. The Teracom Group has 

selected a discount rate that reflects current market assessments of the time 

value of money and the risks specific to the asset. The discount rate does not 

reflect risks for which future cash flows have been adjusted. 

Boxer Sweden 

Impairment testing of Boxer Sweden is based on a calculation of the valuein-use. 

The calculated value is based on cash flow forecasts through 2017, 

which are based on reasonable and verifiable assumptions representing the 

Group's best estimates of the financial conditions that are expected to prevail 

during the period. The present value of the forecasted cash flows has been 

calculated using a discount rate of approximately 8.5 percent. The expected 

future scenario is based on prior experience and external sources. The Group 

management team has determined that there have not been any changes to 

important assumptions such that the calculated value-in-use is now less than 

the carrying amount. 

Plus TV 

Impairment testing of Plus TV is based on a calculation of the value-in-use. 

The calculated value is based on cash flow forecasts through 2017, which 

are based on reasonable and verifiable assumptions representing the Group's 

best estimates of the financial conditions that are expected to prevail during 

the period. The calculations apply to periods that are more than five years in 

the future because the company is still in the start-up phase and it will be 

quite some time before long-term stable profitability is achieved. The present 

value of the forecasted cash flows has been calculated using a discount 

rate of approximately 8.7 percent. Improved margins and growth in sales are 

important variables to consider when calculating Plus TV's value-in-use. The 

expected future scenario is based on prior experience and external sources. 

The Group management team has determined that there have not been any 

changes to important assumptions such that the calculated value-in-use is 

now less than the carrying amount. 

Boxer Denmark 

Impairment testing of Boxer Denmark is based on a calculation of the valuein-use. 




during the period. The calculations apply to periods that are more than five 

years in the future because the company is still in the start-up phase and it 

will be quite some time before long-term stable profitability is achieved. The 

present value of the forecasted cash flows has been calculated using a discount 

rate of approximately 8.6 percent. Important variables to consider when 

calculating Boxer Denmark's value-in-use are improved margins and growth 

in sales. The expected future scenario is based on prior experience and external 

sources. The Group management team has determined that there have not 

been any changes to important assumptions such that the calculated valuein-use 

is now less than the carrying amount. 

Teracom Denmark 

Impairment testing of Teracom Denmark is based on a calculation of the value-in-use. 




during the period. The present value of the forecasted cash flows has been 

calculated using a discount rate of approximately 8.3 percent. The expected 

future scenario is based on prior experience and external sources. The Group 

management team has determined that there have not been any changes to 

important assumptions such that the calculated value-in-use is now less than 

the carrying amount. 

Note 16 continues on the next page 

81



Group 


Patents, 

licenses and 

similar 

rights Goodwill Brand 

Customer 

agreements 

Customer 

relations 

Accumulated cost 

- Opening balance, 1 January 364 1 233 73 20 85 1 775 

- Adjustment of acquisition balance, reclassification to property, 

plant and equipment 

-14 - - - - -14 

- Adjustment of acquisition balance, netting against customer advances -67 - - - - -67 

- Investments 45 0 0 0 0 45 

- Sales/disposals -29 -19 0 0 0 -48 

- Exchange rate differences 0 -3 0 -1 0 -4 

- Reclassification 30 -30 - - - 0 

Closing accumulated cost, 31 December 329 1 181 73 19 85 1 687 

Accumulated amortization 

- Opening balance, 1 January -155 0 0 -2 -16 -173 

- Sales/disposals 21 0 0 0 0 21 

- Exchange rate differences 0 0 0 0 0 0 

- Depreciation for the year -50 - - -6 -11 -67 

Closing accumulated amortization, 31 December -184 0 0 -8 -27 -219 

Accumulated impairment losses 

- Opening balance, 1 January -18 -19 0 0 0 -37 


- Reclassifications 0 0 0 0 0 0 

- Impairment losses for the year -12 0 0 0 0 -12 

Closing accumulated impairment losses, 31 December -30 0 0 0 0 -30 

Carrying amount 

1 January 191 1 214 73 18 69 1 565 

31 December 115 1 181 73 11 58 1 438 

Total 


Group 

2010 

Patents, 

licenses and 

similar 

rights Goodwill Brand 

Customer 

agreements 

Customer 

relations 

Accumulated cost 

- Opening balance, 1 January 209 1 158 84 0 84 1 535 

- Investments 42 0 0 0 0 42 

- Acquisitions 120 112 0 20 12 264 

- Exchange rate differences -7 -37 -11 0 -11 -66 

Closing accumulated cost, 31 December 364 1 233 73 20 85 1 775 

Accumulated amortization 

- Opening balance, 1 January -108 - 0 0 -6 -114 

- Depreciation for the year -47 - - -2 -10 -59 

Closing accumulated depreciation, 31 December -155 0 0 -2 -16 -173 

Accumulated impairment losses 

- Opening balance, 1 January 0 -16 0 0 0 -16 

- Reclassifications 0 -3 0 0 0 -3 


- Exchange rate differences 0 0 0 0 0 0 

- Impairment losses for the year -18 0 0 0 0 -18 

Closing accumulated impairment losses, 31 December -18 -19 0 0 0 -37 

Carrying amount 

1 January 101 1 142 84 0 78 1 405 

31 December 191 1 214 73 18 69 1 565 

Total 

82

Note 17. Other financial assets 

Group 

Other financial assets 2011 2010 

Net asset, pensions 59 51 

Long-term loan receivable 30 56 

Endowment insurance 1 1 

Other 5 6 

Total 95 114 

A detailed description of the item "Net asset, pensions" is provided in note 7. 

Note 18. Deferred tax 

Group 


2011 2010 2011 2010 

Deferred tax assets 172 120 25 - 

Deferred tax liabilities -502 -482 - - 

Deferred tax asset/tax liability, net -330 -362 25 - 

The tables below present deferred tax assets and liabilities for the Group and the Parent Company according to category and how the assets and liabilities 

changed during the year. 

Group 

Deferred tax assets/liabilities 

Untaxed 

reserves 

Intangible 

assets 

Pension 

liability 

Deficit 

deduction 

Opening balance, 1 January -449 -38 -18 134 9 -362 

Cash flow hedges 5 5 

Exchange rate differences -1 0 -1 

Reclassifications -4 18 2 16 

Taken up as income during the year -27 5 -2 37 -1 12 

Closing balance, 31 December 2011 -476 -37 -20 188 15 -330 

Other 

Total 


Deferred tax assets/liabilities 

Deficit deductions Total 

Opening balance, 1 January 0 0 

Taken up as income during the year 25 25 

Closing balance, 31 December 2011 25 25 

On the balance sheet date, the Group has unutilized deficit deductions for 

the Swedish operations totaling SEK 97 (0) million. The deficit deduction was 

reported as a deferred tax asset totaling SEK 25 (0) million. 

The total deficit pertaining to the Danish operations was SEK 755 (572) 

million on the balance sheet date, which corresponds to a deferred tax asset 

of SEK 189 (143) million using the Danish tax rate. Having taken into consideration 

uncertainties about future profits and other factors, a deferred tax 

asset of SEK 104 (105) million was reported by the Boxer Denmark segment. 

Unutilized deficit deductions for the Danish operations amount to SEK 338 

(151) million. 

For the Finnish operations, the total deficit as of the balance sheet date 

was SEK 655 (571) million, which corresponds to a deferred tax asset of SEK 

170 (148) million using the Finnish tax rate. For the Plus TV segment, SEK 58 

(38) million was reported as a deferred tax asset having taken into consideration 

uncertainties about future profits and other factors. Unutilized deficit 

deductions for the Finnish operations amount to SEK 431 (424) million. The 

unutilized deficit deductions have an unlimited life, except for the deductions 

in Finland, which have a 10-year life. 

83

Note 19. Inventories 

Group 

Type of goods 2011 2010 

Finished goods 67 25 

Total 67 25 

Inventories are valued at cost. The cost for inventories that is expensed is 

included in the item Material costs and amounted to SEK 144 (141) million for 

the Group. The obsolescence reserve is included in the value of the inventories. 

The total write-down amount for the year was SEK 0 (0) million. 

Note 20. Accounts receivable 


Accounts receivable 353 306 

Provisions for bad debts -32 -11 

Accounts receivable, net 321 295 

Provisions in relation to accounts receivable 9% 4% 

As of 31 December 2011 the Group's provision for doubtful debts was SEK 

32 (11) million. Group companies with pay TV operations, which have end 

consumers as part of their customer base, make provisions in accordance with 

a pre-determined ladder that has been adapted to the conditions of each geographic 

market. Group companies with network activities, whose customers 

are companies, make provisions based on an individual assessment of each 

customer and receivable. Provisions and the utilization of reserves for doubtful 

receivables were transferred to the income statement and are included in 

cost of sales. 

The carrying amount of accounts receivable is the same as the fair value since 

the discounting effect is insignificant. The fair value of accounts receivable 

constitutes maximum exposure to the calculated risk for bad debt losses. 

The credit terms for various types of contracts and customer categories are 

defined in each subsidiary's credit instructions. A credit statement is obtained 

for sales on credit to both companies and consumers in order to minimize the 

risk of bad debt losses. 

Time analysis of accounts receivable fallen due 2011 2010 

Accounts receivable that have not fallen due 215 188 

Accounts receivable overdue < 30 days 87 94 

Accounts receivable overdue 30 - 60 days 10 6 



Accounts receivable overdue > 121 days 3 3 

Accounts receivable, total 321 295 

Provisions for doubtful receivables 2011 2010 

Provisions 1 January -11 -24 

New provisions -16 0 

Release of reserves 4 11 

Bad debt losses -9 2 

Exchange rate differences and other changes 0 0 

Provisions 31 December -32 -11 

Note 21. Financial instruments and financial risk management 

Teracom’s operations expose the Group to various types of financial risk. The 

Group’s overall financial operations and management of financial risk are 

centralized to the Teracom Group's Finance department. These activities are 

based upon the finance policy established by the Board of Directors, which is 

characterized by the desire to maintain a low level of risk. The Group's financial 

strategy and goals are designed to achieve maximum return on equity 

based upon reliable, cost-effective financial management practices that help 

ensure adequate control and high quality risk management within the Group. 

The overriding principle is to minimize all factors that could have a negative 

impact on earnings and cash flow due to short-term fluctuations in financial 

markets. This applies to both the Parent Company and the Group, in its entirety. 

The Group may use derivative instruments in order to hedge certain exposures 

to risk, however, only for the following purposes: 

- To convert future payments for electricity consumption to a fixed electricity price. 

- To convert future expected commercial payments in foreign currencies (primarily 

EUR) to Swedish krona (SEK). 

- To convert the fixed interest term for borrowing. 

- To hedge net investment in foreign operations. 

The market risks include currency risk, interest rate risk and electricity price 

risk, which are also described in this note. Other financial risks are broken 

down into credit risk, liquidity risk and financing risk. 

Currency risk 

This is the risk that changes in exchange rates will negatively impact the 

Group's profitability or financial position. This type of risk is divided into two 

categories (below): transactional and translational. 

Transactional exposure 

Transaction exposure encompasses all future contractual and forecasted 

income and expenses in foreign currencies, which thus involve a risk that the 

Group's profitability will be negatively impacted by changes in exchange rates. 

The Teracom Group has limited transactional exposure. This is because the 

value-added from international business activities is primarily created locally 

by having expenses in the same currency as the sales revenues. 

Currency derivatives are used to decrease transaction exposure in EUR and 

the hedged flow on the balance sheet date was EUR 6 million. 

Sensitivity analysis of currency risk 

The Teracom Group's currency transactions are primarily in SEK, EUR and DKK. 

During 2011, the net outflow of EUR amounted to the equivalent of SEK -148 

(-146) million. In 2011, the average exchange rate for EUR was SEK 9.0335. A 

fluctuation in the exchange rate of +/- 10 percent would impact profits by 

SEK +/- 15 million. The Group's net flow in DKK during 2011 was close to zero 

through internal currency netting within the Group. 

Translational exposure 

Because the company has international business activities, there is also a 

certain degree of translation exposure. This is rooted in the value of foreign 

investments as well as the profits generated on an ongoing basis. Such profits 

are translated using the average rate for the year as the opening value and 

comparing it to the year's ending rate, which is provided by the Swedish Central 

Bank. The difference is reported against equity. Accordingly, the only time 

that an actual cash flow is involved is in connection with disposals, investments 

and dividends from subsidiaries. 

84

Net investments of foreign operations can be hedged if the Group's Board 

of Directors approves such a decision. Hedge accounting is applied for the 

hedging of net investment via loans or derivative instruments. 

Translation exposure on net assets in foreign subsidiaries amounted to 

SEK 6 (33) million. 

Interest rate risk 

Interest rate risk is defined as the risk that changes in market interest rates 

will have a negative impact on the Group's profit and cash flow. The interest 

rate risk associated with the Teracom Group's financing activities should be 

limited in accordance with its financial goals and having considered all of the 

Group's other risks and margin for such risks. The Group has both interestbearing 

liabilities and cash equivalents. In terms of risks, these two items balance 

each other to a certain extent. Given the desire to limit risks, the goal 

is to minimize interest expenses. Interest-bearing assets should primarily be 

used to reduce existing borrowings and as such, fixed interest terms should 

not extend beyond the closest date for amortizing the Group's loans. Derivatives 

in the form of interest swaps and futures may be used to influence the 

fixed interest term without changing the underlying conditions of the loans. 

Sensitivity analysis of interest rate risk 

As of 31 December 2011, the Group had bank loans of SEK 1,858 (2,209) million. 

Part of the funding is at a fixed rate via interest rate derivatives, see more information 

under the section on financial instruments. The fixed interest term on the 

liability at year-end 2011 was 14.6 months. The base lending rate on the liability at 

year-end 2011 was 1.53 percent. A change in interest rate of 1 percentage point 

affects the Group's interest expenses by SEK +/- 18.6 million on total borrowing. 

Electricity price risk 

Teracom AB has broadcasting activities that consume significant amounts of 

electricity. To limit the exposure to changes in electricity prices, the majority 

of purchased electricity is hedged. Hedging is conducted using financial 

electricity contracts based upon electricity trading instructions that have been 

established by the Board of Directors of Teracom AB. This type of derivative 

only exists in Teracom AB and maturity dates occur during the period 2012- 

2014. Teracom AB hedges electricity prices for 70–100 percent of estimated 

total consumption over the coming 12 months. Thereafter, within the interval 

13-36 months, prices are hedged for a certain portion of the estimated 

consumption volume according to a ladder model. Within the interval 13-24 

months, prices are hedged 40-80 percent and within the interval 25-36 

months, prices are hedged 10-50 percent. 

A change in unrealized gains (losses) related to electricity derivatives, SEK 

-27 million, was transferred to equity since the management team decided 

that the derivative constitutes cash flow hedging. As of 31 December 2011 

there was an unrealized loss attributable to electricity derivatives totaling 

SEK -9 million. At the end of 2010, there was an unrealized gain in electricity 

derivatives of SEK 17 million. 

Sensitivity analysis of electricity price risk 

For 2011, Teracom's total electricity consumption was 110,156 MWh. In 2011, 

Teracom AB had hedged 96,247 MWh. The average spot price for 2011 was 430.81 

SEK/MWh with a variation of approximately +/- 190 SEK/MWh. If the total electricity 

consumption had not been hedged at all, a fluctuation in electricity prices 

of +/- 20 percent could have an effect on profits of SEK +/- 9.5 million. 

Credit risk 

Note 20 describes the accounts receivable and commercial credit risks associated 

with them. This note describes the Group's financial credit risk, which can 

be broken down into two parts: 

- Issuer risk is the risk that the Group fails to get back the amount that was 

invested (including interest) due to default, i.e. the counterparty runs into 

financial difficulties or goes into bankruptcy. 

- Counterparty risk is the risk that the counterparty defaults and is unable 

to fulfill its obligations as per the financial contract, such as a forward 

exchange agreement. As a result, the Group could then encounter losses by 

having to enter into a new contract at going market rates. 

Counterparty risk and issuer risk are managed by only allowing financial contracts 

and investments to be made with established Nordic banks that as a 

minimum have a credit rating of A according to S&P. 

Liquidity risk 

The Group is exposed to the risk of not having sufficient liquid funds at a 

certain point in time and thus not being able to fulfill its payment obligations. 

Liquidity risk is dealt with by making sure that the Group has sufficient liquid 

funds and short-term investments in a liquid market, accessible financing 

through contracted credit facilities and the ability to close market positions. 

The liquidity reserve consists of the Group's liquid funds (credit balances 

and negotiable investments), unutilized available overdraft facilities and 

unutilized credit facilities The liquidity reserve should total at least 10 percent 

of the Group's sales, of which at least SEK 100 million at all times must be 

immediately available 

Surplus of cash equivalents, which is in addition to the need for a liquidity 

reserve in accordance with that set out above and which cannot be used to 

amortize outstanding loans, should be invested within established guidelines 

to create added returns. 

At the end of 2011, the liquidity reserve was SEK 1,193 (1,577) million. 

Group 

Cash equivalents, MSEK 2011 2010 

Cash and bank balances 220 377 

Total 220 377 

Financing risk 

The Teracom Group's goal for its capital structure is to make sure that the 

Group is able to continue its business activities so that it generates a return 

for its shareholders. 

The Teracom Group's financial strategy and long-term goal is to generate 

a return on equity that is at least 17 percent, along with a long-term equity 

ratio ranging between 30-40 percent. 

During 2011, the Group's strategy was to maintain a maximum net debt/ 

equity ratio of 175 (175) percent, which means that the amount of capital 

loaned out by the Group may not exceed an amount that is 1.75 times the 

carrying amount of the Group's equity. The long-term target for the net debt/ 

equity ratio is 100 percent. As of 31 December 2011 and 2010, the net debt/ 

equity ratio was as follows: 

MSEK 2011 2010 

Interest-bearing liabilities 2 016 2 381 

Less: Cash equivalents -220 -377 

Other interest-bearing assets -56 -52 

Net liability 1 740 1 952 

Equity 1 773 1 743 

Net debt/equity ratio 0,98 1,12 

Upplysningscentralen (UC) – Sweden's largest and leading business and credit 

information agency has given Teracom AB a risk class rating of 5. 

Maturity dates for liability items (excluding interest) 

The table below is an analysis of the Group's financial liabilities, which have 

been categorized according to the time remaining until the contractual maturity 

date as of the balance sheet date. The amounts shown in the table represent 

contractual undiscounted cash flows. 

Maturity dates for liability items 2011-12-31 

MSEK 

Within one 

year 

Group 

1-2 years 2-3 years 3-4 years 4-5 years 

More than 

five years 

Bank loan 75 302 75 1 206 200 0 1 858 

Other loans 13 0 0 0 0 0 13 

Derivative instruments 16 0 0 10 0 0 26 

Call option, Digi TV Plus Oy 128 0 0 0 0 0 128 

Financial leasing 0 0 0 0 0 0 0 

Total 232 302 75 1 216 200 0 2 025 

Total 

85


The Group maintains financing flexibility by entering into credit agreements 

to make sure that it has both immediate and long-term access to credit facilities. 

The Group can also take action to influence the maturity dates on its loan 

stock and by making sure to take loans with at least two creditors. 

Financial loan conditions 

The Group has not entered into any new agreement for credit facilities in 

2011. Existing credit agreements include financial loan conditions, i.e. covenants, 

relating to net debts/EBITDA, the interest coverage ratio and the equity 

ratio that must be satisfied each quarter. Should the agreed-upon covenants 

not be satisfied, this would then entitle the lender to cancel the credit agreement. 

All of the financial ratios fulfilled the contracted limits during the year. 

During the year, the Group's net liabilities increased/decreased by SEK -212 

(1,042) million. On the balance sheet date, the Group reported a net liability of 

SEK 1,740 (1,952) million. 

Contract terms, pledged assets and financial obligations 

The scope of Group's pledged assets and contingent liabilities is limited. Disclaimers 

are typically in place whenever the Group enters into agreements to 

obtain credit. The disclaimer states that Group companies do not grant the 

lender any type security in the form of chattel mortgages or similar items. 

Rather, they only commit to not providing any collateral to another party. 

Calculation of fair value 

The table below shows financial instruments measured at fair value, based 

on how classification in the fair value hierarchy has been done. The different 

levels are defined as follows: 

- In Level 1, fair value is based on financial instruments at listed prices (unadjusted) 

on active market for identical assets or liabilities. A market is considered 

to be active if quoted prices from a stock exchange, broker, trade 

association, pricing service or surveillance authority are easily and regularly 

available. The prices must also represent actual and regularly occurring 

arm's length market transactions. The quoted market price used for the 

Group's financial assets is the current bid price. 

- The fair value of financial instruments that are not held in an active market 

is established by using valuation techniques. To the extent possible, market 

information is used whenever it is available and company-specific information 

is used as little as possible. If all significant input data required for fair 

value measurement of an instrument is observable, the instrument will then 

be categorized in Level 2. 

- In instances where one or more significant input data items are not based 

on observable market information, the instrument will then be classified as 

Level 3. 

The following table shows the Group's financial assets and liabilities measured at 

fair value as of 31 December 2011. 

Fair value hierarchy 2011 

MSEK Level 1 Level 2 Level 3 Total 

Financial assets valued at fair value via the income statement 

- Derivative instruments 2 - - 2 

Financial assets, total 2 - - 2 

Financial liabilities 

Derivative instruments where hedge accounting is applied 26 - - 26 

Financial liabilities valued at fair value via the income statement - 128 - 128 

Financial liabilities, total 26 128 - 154 

The following table shows the Group's financial assets and liabilities measured at 

fair value as of 31 December 2010. 

Fair value hierarchy 2010 

MSEK Level 1 Level 2 Level 3 Total 

Financial assets 

Financial assets valued at fair value via the income statement 

- Electricity derivatives included in the item, Derivative instruments 17 - - 17 

Financial assets, total 17 - - 17 

Financial liabilities 

Financial liabilities valued at fair value via the income statement 

- Put option included in the item, Other current liabilities - 125 - 125 

Financial liabilities, total - 125 - 125 

86

Financial derivative instruments 

The following table shows the fair value of the Group's financial derivative 

instruments for managing financial risks. 

Derivative instruments at fair value 31 December 2011 31 December 2010 

Assets Liabilities Assets Liabilities 

Interest rate swap 

Cash flow hedges - 10 - - 

Hedges of fair value - - - - 

Held for trading - - - - 

Currency interest rate swap 

Cash flow hedges - - - - 

Hedges of fair value - 6 - - 


Electricity derivatives 

Cash flow hedges - 10 17 - 

Hedges of fair value - - - - 


Total 0 26 17 0 

Note 22. Prepaid expenses and accrued income 

Group 


Prepaid expenses and accrued income 2011 2010 2011 2010 

Accrued income 82 51 2 - 

Prepaid project expenses 142 98 0 - 

Prepaid boxes in customer agreements 83 71 0 - 

Other items 22 22 0 - 

Total 329 242 2 - 

Prepaid project expenses 

Prepaid project expenses refer to costs for fixed-price contracts. These expenses 

are reported in accordance with the percentage of total service that has 

been delivered. These expenses consist of program company expenses in order 

to provide customers with access to TV programs, as well as direct expenses 

related to taking orders. 

Prepaid boxes in customer agreements 

Prepaid boxes in customer agreements are expenses for boxes that are included 

in agreements with customers. These expenses are reported in accordance 

with the percentage of total service that has been delivered. 

87

Note 23. Equity 

Share capital 

According to the articles of association for Teracom Group AB (the 

Parent Company), the share capital should amount to no less than 

SEK 50,000 and no more than SEK 200,000. As of 31 Decembe r 

2011, the share capital was SEK 50,000. The quotient value is 

SEK 1,000. All 50,000 shares are fully paid and carry full entitlement to an 

equal voting right and share in the company’s assets. 

No shares are held by the Company itself or its subsidiaries. 

Other contributed capital 

Other contributed capital refers to capital contributed by the owner. 

Reserves 

Reserves include all exchange rate differences arising during the translation 

of financial statements from foreign operations, changes in the translation of 

goodwill, other surpluses in local currency and derivative instruments subject 

to hedge accounting. Reserves also include tax related to the above items. 

Profit brought forward 

Profit brought forward, which includes the profit/loss for the period, also 

includes earned profits for the Parent Company and its share of profits/losses 

of subsidiaries. Profit brought forward includes amounts to be distributed as 

dividends. 

Proposed dividends 

As of 31 December 2011, the Parent Company had non-restricted equity of 

SEK 1,859 million. A decision about dividends will be made at the AGM on 

18 April 2012. The Board of Directors' proposed dividend is SEK 110 million. 

Note 25. Provisions 

Long-term provision 

Group 

Pension provisions 

Provisions 2011 2010 


Provisions made 0 1 

Provisions utilized 0 -2 

Closing balance, 31 December 1 1 

Short-term provision 

Group 

Restructuring 



Provisions made 6 5 

Provisions utilized -4 -4 

Closing balance, 31 December 4 2 

Short-term provision 


Restructuring 


Opening balance, 1 January 0 - 

Provisions made 4 - 

Provisions utilized 0 - 

Closing balance, 31 December 4 - 

Provisions made and utilized consist of estimated personnel expenses resulting 

from the Group's decision to execute a reorganization of the company. 

These expenses primarily consist of retirement pensions. 

Note 24. Accrued expenses and 

deferred income 

Deferred income primarily pertains to deferred income for pay TV subscriptions 

and deferred income for capacity and co-location. 

The long-term portion of deferred income amounts to SEK 79 (70) million 

for the Group and SEK 0 (-) million for the Parent Company. 

The components of the current portion of deferred income are shown in the 

table, below. 


Accrued expenses and 

deferred income 2011 2010 2011 2010 

Accrued personnel expenses 67 66 9 - 

Deferred income 517 463 0 - 

Accrued expenses for program 

companies 

73 61 - - 

Other items 98 174 5 - 

Total 755 764 14 - 

88

Note 26. Shares and participations in Group companies 

Participations in Group companies 

Company name CIN Registered office 

Teracom AB 556441-5098 Stockholm 

Boxer TV-Access AB 556548-1131 Stockholm 

Oy Boxer TV AB 1589479-9 Helsinki 

Boxer TV A/S 29939470 Copenhagen 

Teracom A/S 25598008 Taastrup 

Digi TV Plus Oy 1988050-3 Helsinki 

Teracom Mobile TV AB 556392-5303 Stockholm 

Teracom Mast AB 556711-9168 Stockholm 

Book value 

Company name Number shares Equity Profit (loss) for the year 

Capital/share 

of votes, % 2011 2010 

Teracom AB (Parent Company previous year) 250 000 1 572 304 100 1 633 

Boxer TV-Access AB 3 332 156 156 100 1 410 1 410 

Oy Boxer TV AB 392 100 0 0 

Boxer TV A/S 5 000 -256 -258 100 444 

Teracom A/S 3 800 1 288 43 100 1 410 1 410 

Digi TV Plus Oy 2 921 500 -134 -75 53 394 413 

Teracom Mobile TV AB 10 000 1 0 100 0 0 

Teracom Mast AB 10 000 1 0 100 1 1 

5 292 3 234 

Note 27. Acquired businesses 

On 30 September 2010, Teracom AB acquired 100 percent of the shares in 

the Danish terrestrial network operator, BSD, which consists of the following 

three companies: Broadcast Service Denmark A/S, Broadcast Stations Company 

1 A/S and Broadcast Stations Company 2 A/S. The consideration, SEK 

1,394 million, was paid in cash. Acquisition costs amounted to SEK 16 million 

and have been included in the Group's income statement for 2010 as other 

expenses. The acquired companies, which were merged in May 2011, comprise 

a cash-generating unit called Teracom A/S. According to the final acquisition 

analysis, the assets and liabilities included in the acquisition of Teracom A/S 

are as follows: 

MSEK 

Value according to 

acquisition analysis 

Property, plant and equipment 1 440 

Customer agreements 20 

Customer relations 12 

Intangible assets 39 

Current receivables - interest-bearing 47 

Current receivables - non interest-bearing 4 

Cash and bank balances 147 

Provisions (deferred tax liabilities) -8 

Long-term liabilities - interest-bearing -241 

Long-term liabilities - non interest-bearing -98 

Current liabilities - interest-bearing -43 

Current liabilities - non interest-bearing -37 

Acquired identifiable net assets 1 282 

Goodwill 112 

Purchase sum for shares in subsidiary 1 394 

possible to calculate the total amount of income that the Group would have 

had if Teracom A/S had been consolidated on 1 January 2010 since Teracom 

A/S consisted of several companies during 2010 and the legal structure was 

changed just prior to the acquisition. 

Note 28. Pledged assets 

The Group's and the Parent Company's pledged assets at the end of the year 

amounted to SEK 0 (0) million and 0 (0), respectively. 

Note 29. Contingent liabilities/Guarantees 

At the end of 2011 there was only one contingent liability/guarantee in the 

Parent Company. It was also the only contingent liability in the Group. The 

contingent liability referred to a Parent Company guarantee for the subsidiary 

Boxer TV A/S. The Parent Company guarantees its subsidiary's financial commitments 

in a Letter of Financial Support. 

Purchase sum entered as a liability -6 

Consideration paid on 31 December 2010 -1 388 

Cash equivalents in acquired subsidiaries 147 

Change in Group cash equivalents as of 

31 December 2010 

-1 241 

The income from Teracom A/S included in the consolidated income statement 

for the period 1 October-31 December 2010 amounted to SEK 60 million. 

Teracom A/S also contributed a profit before tax of SEK 18 million. It is not 

89

The undersigned hereby declare that the consolidated financial 

statements and annual report have been prepared in 

accordance with international financial reporting standards 

(IFRS), as adopted by the EU, as well as generally accepted 

accounting principles. These give a true and fair view of the 

Group's and the Parent Company's financial position and 

earnings. In addition, the Group's Directors' Report and the 

Parent Company's Director's Report provide a fair overview 

of how the Group and the Parent Company's businesses have 

developed, along with financial position and earnings. The 

significant risks and uncertainty factors facing the companies 

that belong to the Group have also been described. 

Sundbyberg, March 16, 2012 

Åsa Sundberg 

Chairman of the Board 

Lars Grönberg Kristina Axberg Bohman Urban Lindskog 

Maria Curman Nils-Petter Tetlie Ingrid Engström 

Johan Hallberg Magnus Ahxner John-Olof Blomkvist 

Crister Fritzson 

President/CEO 

Sten Håkansson 

Authorized Public Accountant 

90

Auditors' report on overall review of 

the Sustainability Report 

To the readers of Teracom's Sustainability Report 

The management of Teracom Group AB commissioned us to 

conduct a general review of the sustainability information 

referred to in the GRI index in Teracom Group AB's combined 

2011 Annual and Sustainability Report. The Board and senior 

management team are responsible for the operating activities 

related to the environment, the work environment, social 

responsibility and sustainable development, as well as the 

preparation and presentation of the Sustainability Report in 

accordance with applicable criteria. Our responsibility is to 

express an opinion on the Sustainability Report that is based 

upon our overall review. 

The purpose and scope of a review 

We carried out our overall review in accordance with RevR 6 

Assurance of sustainability reports, which is published by FAR. 

A review consists of making inquiries, primarily of persons 

responsible for preparation of the Sustainability Report, and 

applying analytical and other review procedures. A review 

has a different purpose and is substantially more limited in 

scope than an audit conducted in accordance with IAASB's 

standards for audit and quality control, and other generally 

accepted auditing standards. The procedures performed in a 

review do not enable us to obtain a level of assurance that 

would make us aware of all significant matters that might 

be identified in an audit. Therefore, the conclusion expressed 

based on a review does not give the same level of assurance 

as a conclusion based on an audit. 

The criteria that we used to base our review on are the 

parts of the Sustainability Reporting Guidelines, G3, issued 

by Global Reporting Initiative (GRI), which are relevant for 

the Sustainability Report along with the accounting and calculation 

principles specifically designed and specified by the 

company. We believe that these criteria are appropriate to 

use for preparation of the Sustainability Report. 

Based on an assessment of materiality and risk, our 

overall review covered the following items: 

a. updating our own knowledge and understanding of 

Teracom's organization and operations, 

b. assessing the results of the company's dialogue with 

stakeholders, 

c. conducting interviews with managers at the Group level 

and at selected units, with the aim of assessing whether 

the qualitative and quantitative information contained in 

the Sustainability Report is complete, accurate and sufficient, 

d. examining internal and external documentation in order 

to assess whether the reported information is complete, 

accurate and sufficient, 

e. evaluating the design of the systems and processes that 

have been used to collect, manage and validate sustainability 

information, 

f. conducting an analytical review of the reported information, 

g. assessing the company's stated application level in terms 

of GRI guidelines, 

h. assessing the overall impression made by the 

Sustainability Report, along with its format and with 

that, assessing whether the information reciprocally is in 

agreement with the applied criteria. 

Conclusion 

Based on our overall review, no circumstances were 

brought to light that would give us reason to believe that 

the Sustainability Report was not, in all material respects, 

prepared in accordance with the criteria stated above. 

Stockholm, March 16, 2012 

PricewaterhouseCoopers AB 



Fredrik Ljungdahl 

Specialist member of FAR 

91

Auditor's report 

To the AGM in Teracom Group AB, CIN 556842-4856 

Report on the annual report and consolidated financial 

statements 

We have audited the annual report and consolidated financial 

statements of Teracom Group AB for 2011. The company's 

annual report and consolidated financial statements are 

included in the printed version of this document on pages 

44–89. 

The responsibility of the Board of Directors and the 

President/CEO for the annual report and consolidated 

financial statements 

The Board of Directors and the President/CEO are responsible 

for preparing an annual report that presents a true and 

fair view in accordance with the Annual Accounts Act and 

consolidated financial statements that present a true and fair 

view in accordance with the IFRS international accounting 

standards, as adopted by the EU, and the Annual Accounts 

Act, and for the internal control that the Board of Directors 

and the President/CEO deem to be necessary to prepare an 

annual report and consolidated financial statements that are 

free of material misstatement, whether such are the result of 

falsifications or errors. 

Responsibility of the auditor 

Our responsibility is to express our opinion on the annual 

report and the consolidated financial statements based on 

our audit. We conducted the audit in accordance with the 

International Standards on Auditing and generally accepted 

auditing standards in Sweden. These standards require that 

we apply professional moral requirements and plan and 

carry out the audit in such a manner as to assure reasonable 

certainty that the annual report and consolidated financial 

statements are free of material misstatement. 

An audit entails obtaining through different measures 

audit evidence regarding amounts and other information 

in the annual report and consolidated financial statements. 

The auditor decides the measures that will be conducted, 

in part by assessing the risks for material misstatement in 

the annual report and consolidated financial statements, 

regardless whether these misstatements are due to falsifications 

or error. When conducting this risk assessment, the 

auditor takes into account the areas of internal control that 

are relevant for how the company prepares its annual report 

and consolidated financial statements in order to present a 

true and fair view, with the intention of designing auditing 

measures that are appropriate given the circumstances, but 

not with the intention of making a statement regarding the 

efficiency of the company's internal control. An audit also 

entails evaluating the appropriateness of the accounting 

principles applied and the plausibility of the estimations 

made by the board of directors and the managing director 

in the report, as well as evaluating the overall presentation 

of the annual report and consolidated financial statements. 

We believe the audit evidence we obtained to provide a 

sufficient and appropriate base for our statement. 

Opinion 

It is our opinion that the annual report has been prepared in 

accordance with the Annual Accounts Act and in all material 

aspects provides a true and fair view of the Parent Company's 

financial position as of 31 December 2011 and the financial 

results and cash flows for the year in accordance with the 

Annual Accounts Act, and that the consolidated financial 

statements were prepared in accordance with the Annual 

Accounts Act and provide in all material aspects a true and 

fair view of the Group's financial position as of 31 December 

2011 and its results and cash flows in accordance with the 

international accounting standards, as adopted by EU, and 

the Annual Accounts Act. A Corporate Governance Report 

has been prepared. The Directors’ Report and the Corporate 

Governance Report are consistent with the other parts of the 

annual report and the consolidated financial statements. 

We therefore recommend to the Annual General Meeting 

that the income statement and balance sheet for the Parent 

Company and the Group be adopted. 

Reports on other requirements in accordance with laws 

and other regulations 

In addition to our audit of the annual report and consolidated 

financial statements, we also audited the proposed 

appropriations regarding the company's profit or loss and 

the Board of Director's and the President/CEO's administration 

of the Teracom Group AB for 2011. 

The responsibility of the Board of Director and the President/ 

CEO 

It is the responsibility of the Board of Directors to propose 

the appropriations regarding the company's profit or loss, 

and it is the responsibility of the Board of Directors and the 

President/CEO for administration in accordance with the 

Companies Act. 

92

Responsibility of the auditor 

It is our responsibility to express our opinion with reasonable 

certainty on the proposed appropriations regarding the 

company's profit or loss and the administration based on our 

audit. We conducted the audit in accordance with generally 

accepted auditing standards in Sweden. 

As the basis for our statement regarding the Board of 

Director's proposed appropriations regarding the company's 

profit or loss we audited the Board of Director's reasoned 

opinion and a sample of the data underlying this opinion 

in order to assess if the proposal is in compliance with the 

Companies Act. 

As the basis of our statement regarding discharge from 

liability, in addition to our audit of the annual report and 

consolidated financial statements, we examined significant 

decisions, actions taken and circumstances of the Company 

in order to be able to determine the possible liability to the 

Company of any Board member or the President/CEO. We also 

examined whether any Board member or the CEO has, in any 

other way, acted in contravention of the Swedish Companies 

Act, the Annual Accounts Act or the articles of association. 

We believe the audit evidence we obtained to provide a 

sufficient and appropriate base for our statement. 

Opinion 

We recommend that the Annual General Meeting distribute 

the profit in accordance with the proposal in the Directors’ 

Report and discharge the members of the Board of Directors 

and the President/CEO from liability for the financial year. 

Stockholm, March 16, 2012 

PricewaterhouseCoopers AB 



93

Teracom Group's service technicians 

are used to working at heights that 

are often over 300 m. 

95

Technical definitions 

Broadcasting 

Transmission of radio and TV. 

Co-location 

Allows companies and organizations to rent a place in the network operator’s 

masts and stations. Typically, the equipment belongs to the customer. 

DAB 

Digital Audio Broadcasting, digital radio. 

DAB+ 

The future digital radio standard for the terrestrial radio network. 

DVB-T 

Digital Video Broadcasting Terrester. The European standard 

for terrestrial digital TV. 

DVB-T2 

The future digital TV standard for the terrestrial TV network. 

Environmental Code 

This refers to the portion of Swedish legislation that protects human health 

and the environment. The work environment is regulated in other legislation. 

Free TV (FTA) 

Channels that do not require any special subscription. 

Global Compact 

Global Compact is a UN initiative to unite companies with UN bodies, trade 

unions and the civil sector. The initiative supports ten principles concerning 

human rights, labor legislation, the environment and efforts to counteract 

corruption. Its vision is for a more sustainable economy that does not marginalize 

different groups in society or have a negative impact on the environment. 

HDTV (High Definition TV). 

High definition TV that has a sharper picture than standard TV. 

IPA (Important Public Announcements) 

These are important messages to society. It is the society’s information channel 

used to reach those who are affected by very serious accidents/disasters 

and similar events. 

IPTV 

Broadband TV that is distributed via fiber or ADSL, for example. 

MPEG2/MPEG4 

Moving Pictures Expert Group. Compression for digital TV broadcasts. With 

MPEG-2 coding technology, there is room for 5 to 7 standard TV channels in 

each multiplex. With the new MPEG-4 technology, there is room for 10 to 12 

standard TV channels, or 2 to 4 HDTV channels. 

MUX (multiplex) 

Frequency space for digitally compressed signals. A MUX utilizes a frequency 

channel for transmission. 

Pay TV 

Channels requiring a paid subscription. 

Radio newspapers 

Recordings of newspaper articles for the visually impaired and dyslectics. Distributed 

via the FM network. 

RDS 

Radio Data System, technology for broadcasting texts and program-related 

messages in FM radio. 

Triple play 

An offering that includes telephony, Internet and TV that is distributed via the 

same network using shared technology. 

TV Operator 

The Teracom Group's common position as both a pay TV operator and a network 

operator. 

VoD (On demand) 

Video-on-demand, films or TV programs distributed to viewers at the exact 

moment they themselves desire to view the content. 

3G 

Third generation mobile telephony. It offers more rapid transmission speeds 

between mobile telephones, with the possibility of sending moving pictures, 

among other things. 

4G 

Fourth generation mobile telephony. 

Financial definitions 

Average number of employees 

The number of employees at the beginning of the year, plus the number of 

employees at year end, divided by two. 

Capital employed 

Total assets less non interest-bearing liabilities including deferred tax 

liabilitie s. 

EBIT 

Operating profit according to the income statement. 

EBITDA 

Operating profit excluding depreciation/amortization of property, plant and 

equipment and intangible assets. 

Equity ratio 

Equity expressed as a percentage of total assets. 

Net liability 

Interest-bearing liabilities less interest-bearing assets and cash equivalents 

Operating income 

Income that has been earned or is from work completed during the period. 

Pertains to all income except work performed by the company for its own use 

and capitalized, which is included as part of operating expenses. 

Operating margin 

Operating profit expressed as a percentage of operating income. 

Return on capital employed 

Profit after net financial income/expense plus financial expenses expressed as 

a percentage of average capital employed. 

Return on equity, 

Profit for the year expressed as a percentage of adjusted equity. 

Net debt/EBITDA 

Net debt divided by EBITDA 

96

Our services are easy to use, solutions easy to 

understand and our processes easy to work with. 

We simplify by working in a smart, fast and 

effective way to attract and retain customers 

and build our competitive strength. 

We deliver what we promise as we care for 

customers and colleagues. 

To secure long term loyalty and commitment, 

we build trust through mutual respect and 

individual ownership. 

We take pride in making a difference for our 

customers and users as well as for our company. 

We stand out in the market with solutions 

that create significant value and attract 

customers. 

CONTACT INFORMATION: 

Teracom Group AB Teracom A/S Boxer A/S 

Box 30150 Banestrøget 19-21 Postbox 118 

SE-104 25 Stockholm DK2630 Taastrup DK 1004 København k 

Street address: Street address: Street address: 

Lindhagensgatan 122 Banestrøget 19-21 Langebrogade 6E, 1. Sal 

SE-112 51 Stockholm Taastrup Köpenhamn K 

Tel: +46 8 555 421 00 Tel: +45 7011 8011 Tel: +45 7025 1588 

Fax: +46 8 555 420 01 Fax: +45 4371 1143 info@boxertv.dk 

www.teracomgroup.se info@teracom.dk Customer service tel: +45 7033 2033 

www.teracom.dk 

kundeservice@boxertv.dk 

www.boxertv.dk 

CIN: 556842-4856 

Teracom Sweden Boxer TV-Access AB Digi TV Plus Oy 

Box 30150 Box 30150 Pasilankatu 2 

SE-104 25 Stockholm SE-104 25 Stockholm FI-00240 Helsinki, Finland 

Street address: Street address: Street address: 

Lindhagensgatan 122 Lindhagensgatan 122 Pasilankatu 2 (Huolintatalo) 

SE-112 51 Stockholm SE-112 51 Stockholm Helsinki 

Tel: +46 8 555 420 00 Tel: +46 8 587 899 00 Tel: +358 10 387 3001 

Fax: +46 8 555 420 01 Fax: +46 8 587 899 99 Fax +358 10 387 3088 

Customer service tel: 077191 00 85 customer service tel: 077121 10 00 Customer service tel: +358 10 309 8008 

www.teracom.se kundservice@boxer.se asiakaspalvelu@plustv.fi 

www.boxer.se 

www.plustv.fi

Annual and Sustainability Report 2011 - Teracom

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