Annual Report 2023
We empower
green digital
connections
Teglholmsgade 1
2450 København SV
CVR-nr.: 42867616
Generalforsamling: 7. marts 2024
Dirigent ved generalforsamlingen: Signe Johanne Helbo
Content
2023 in brief
4 Letter from the CEO
6 Highlights
8 Key figures
Our business
10 Our business model
12 Our strategy and priorities
17 Addressing our material impacts
19 Our sustainability priorities
Financial results
22 Revenue
23 Operational costs and EBITDA
24 Result for the year and capital
expenditures
25 Equity, cash flow and funding
26 Guidance
Sustainability results
28 Sustainability priorities
29 Climate and nature
39 Health and safety
42 Diversity and inclusion
45 Digital trust
48 Addressing supply chain impacts
51 Memberships and ratings
Governance
53 Enterprise risk management
58 Responding to climate risks
60 Corporate governance
63 Board of Directors
67 Executive Leadership Team
69 Policies and grievance mechanism
ESG statements
71 Our ESG performance
77 EU Taxonomy reporting
82 ESG accounting principles
88 About the sustainability pages
Annual Report 2023
Financial statements
90 Consolidated financial statements
95 Notes to consolidated financial
statements
138 Parent company financial statements
143 Notes to parent company financial
statements
148 Management statement
149 Independent auditor’s report
151 Independent Auditor’s Assurance Report
on the ESG statement
Shortcut to reading the report
Click on the tabs in the menu to navigate quickly to the table of contents for the report and accounts respectively.
In the rest of the annual report, TDC NET Holding A/S is referred to as TDC NET.
This report describes TDC NET's compliance with sections 99a,
99b, 99d and 107d in the Danish Financial Statements Act.
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Letter from the CEO
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Transforming TDC NET
to lead the green digital
transition
We enable Denmark’s leading digital position
2023 paved the way for our ambitious transformation, aimed at
maintaining our position as market leader through ever-evolving
technological development. We are investing in integrating
artificial intelligence, data automation and other new
technologies into our core business, to increase resilience and
efficiency, and to provide an excellent customer experience.
Financial growth in society requires a reliable, secure and
resilient digital infrastructure. At TDC NET, we have already
ensured 1.7 million households’ access to high-speed broadband
connections. And in 2023, we moved the fibre needle from 600k
to 700k homes passed, steadily approaching our goal of rolling
out high-speed fibre to one million households in Denmark. By
connecting Denmark, we enable the nation to keep its digital
leadership position.
Our investments in customer solutions totalled DKK 3,037m.
Besides focusing on massive investments in fibre, we continued
to provide Denmark’s best 5G mobile network – for the eighth
year in a row
1
.
End-to-end transformation
Our newly initiated transformation is encompassing the entire
business and full customer journey. In 2023, we initiated
the decommissioning of our copper network – and plan
to fully close the 140-year-old technology by 2030. Other
technologies are also being decommissioned – as 3G was in
2023. Decommissioning will not only reduce complexity, but also
reduce our CO
2
footprint. Another focus area involves simplifying
and automating massively, to enhance the customer experience
while also halving our IT costs. Automation will ensure fewer
faults, faster recovery and more user-friendly services.
1
Danish Technological Institute link →
4/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
"2023 paved the way for launching our ambitious transformation
aimed at making TDC NET Denmark’s undisputed market leader
by 2030 – within mobile network and fixed connections. We are
striving to become a leading green TechCo, using cutting-edge
technologies on top of our core mobile and broadband solutions,
while delivering value to our shareholders"
Successful refinancing
After the separation from Nuuday, we have built a new funding
platform to serve our needs as a standalone company. In
2023, we succeeded with two rounds of issuing EUR 500m
sustainability-linked bonds to refinance existing bank facilities.
The trust in our business model secured us a BBB- (stable) rating
from Fitch and significant interest from investors.
Solid 2023 performance
Our accomplishments in 2023 can be attributed to the
efforts of our employees. Their commitment, passion and
The foundation for these focus areas is our ESG leadership
and our dedicated people. We will invest in our people and
secure 400-500 future-proofed competencies to deliver on
our transformation and to become the market leader in the
societal green, digital transition.
All this will drive our revenue up – the last key element in
the transformation. We initiated our organic revenue growth
in 2023, by creating a stronger focus on connecting and
activating homes. In Q4, we saw the benefit with record-high
activation of fibre customers, which had a positive impact on
our financial results this year – and will for the coming years.
To better meet the increasing digital needs of our broad
range of customers, we will continue the roll-out of fibre and
decommission of copper. We remain committed to connecting
Denmark with fibre, coax and mobile. This includes massive
investments in our C-band, allowing for high-speed mobile
broadband. This mix of technologies serves the interests of
customers – households, businesses and public institutions.
Expanding our climate leadership to include nature
Executing on our strong commitment within ESG forms the
way we drive our business and reach our objectives. As front-
runners for the climate agenda, we are driven by our science-
based targets for becoming net zero across our entire value
chain by 2030. In 2023, we delivered the largest CO
2
emission
reductions in the history of TDC NET, driven mainly by our
investments in renewable electricity from the four solar parks.
We now want to broaden our leadership position on climate to
include the nature and biodiversity crisis, which poses a great
threat to our planet as well as to the economy. According to
the World Economic Forum
2
, 44 trillion dollars of the global
economy is at risk, and urgent action is needed. In late 2023,
our Board of Directors adopted a new biodiversity strategy
aligned with the 30-by-30 ambition set at COP15 in Montreal:
to preserve 30% of land and water by 2030. We are proud to
be the first company in the world to adopt this target and aim
for 30% of TDC NET land to be preserved for nature by 2030.
The target will contribute to our ambition of connecting Danish
nature - for everyone.
collaboration have played a pivotal role. Amid our 2023
achievements, we experienced a challenging macroeconomic
landscape, but maintained our investments and financial
performance in line with expectations. We anticipate some of
the uncertainty continuing into 2024, and we are monitoring
developments closely, backed by our talented team who
have steered TDC NET skilfully through the past year. We are
grateful for their commitment and look forward to continuing
the teamwork to connect Denmark for everyone.
Michel Jumeau
CEO
2
Source: World Economic Forum: → The Future Of Nature And Business
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6/154
-59%
-5%
-2.7%
-17.6%
3.9%
-6.5%
2022
DKK 6,639m
2022
DKK -1,857m
2022
DKK 4,520m
2022
DKK -3,248m
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Highlights
ESG
In 2023, we announced our end-to-end transformation, a
milestone in our separation journey. Despite revenue remaining
flattish due to accelerated customer migration to high-speed
solutions, we achieved a positive growth in EBITDA, thanks to
lower power prices from our PPAs and the contributions from our
competent teams leading to opex efficiencies. This enabled us to
continue our high investment in our core business like fibre roll-out
Scopes 1 and 2
(CO
2
)
Reduced emissions from our own operations
by 59% compared with 2022 and by 59%
compared with 2020
Scope 3
(CO
2
)
Reduced emissions from our value chain by
5% compared with 2022 and by 34%
compared with 2020
and mobile, thereby fulfilling our guidance for the year. The year
was significantly impacted by the hedging instrument related to
the financing platform, resulting in a negative result for the year.
Results
2023
2022
33,191 tCO2e
81,426 tCO2e
2023
2022
83,719 tCO2e
88,478 tCO2e
Revenue
(Development)
In line with expectations, as per our guidance
for maintaining stable revenue
OPEX
(Development)
In alignment with our guidance, emphasising
efficiency improvements compared with 2022
EBITDA
(Development)
Year-on-year is in line with expectations of
generating low single-digit growth
CAPEX
(Development)
The investment level in our core business
remained at the same high level as in 2022
2023
DKK 6,461m
2023
DKK -1,530m
2023
DKK 4,695m
2023
DKK -3,037m
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Highlights
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Strategy enforcing our strong
market position within
superior connections
“Customer focus” is a strategic
priority within our transformation,
and in 2023 we experienced an
increase in customer satisfaction
driven by higher levels of feedback
from customers on our fibre roll-out
and resilience in the mobile network.
Denmark's best mobile network
for the eighth year in a row
For eighth years, we have proudly
maintained our position as
Denmark's best mobile network
with an 88% flawless experience,
unmatched download and upload
speeds, near-perfect mobile calls,
and 99.7% in 5G video streaming,
supported by our fully developed
nationwide 5G network with 99%
accessibility
1
.
TDC NET records 59% CO
2
cut in
emissions from own operations
In 2023, we achieved a historic
59% reduction in Scope 1 and 2
CO
2
emissions compared with our
2020 baseline. This achievement is
driven by investments in renewable
electricity from our four solar parks,
underscoring our dedication to
minimising our carbon footprint and
leading the climate agenda.
Additional 95k new adressess
passed with fibre from TDC NET
We have successfully passed
95k new addresses with fibre
technology, bringing our total to
702k. This achievement underscores
our commitment to advancing our
fibre roll-out strategy at full speed,
aligning with our expectations for
future development of our network
and connectivity excellence.
Changes in the Executive
Leadership Team
In 2023, we entered a new phase
in our transformation journey.
Consequently, Selina Lomholdt,
Campbell Fraser and Angelos
Cacouros joined the Executive
Leadership Team as Chief Human
Resource Officer, Chief IT Officer
and Head of Strategy & Programme
Office, respectively.
1 Danish Technological Institute 2023 link →
Read more about our sustainability performance in the following sections: Our business on pages 9-20, Sustainability results on pages 27-51, Governance on pages 52-69 and the ESG
statements on pages 70-87. Our annual report represents our compliance with sections 99a, 99b, 99d and 107d in the Danish Financial Statements Act. See our statutory reporting on 99a
on pages 10-11 (business mode), 17-18 (materiality assessment), 19-20 (strategy), 27-51 (policy governance, implementation measures, actions and results, due diligence and expectations for
future work) and pages 53-59 (risks and migitation actions); 99b and 107d on page 66 and 99d on pages 45-47.
© Better Energy
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Key figures
1
Cash flow from operating and investing activities (adjusted
for loans to TDC Holding) as well as lease payments. See
also note 5.3
2
Excluding lease and spectrum liabilities as well as a loan to
TDC Holding.
3
Calculated with the adjusted net interest-bearing debt and
EBITDA adjusted with the effect of lease payments.
4
High-speed broadband is defined as coax and fibre
technology, and low-speed is defined as copper
technology.
5
The number of homes passed with fibre includes all
completed connections.
2023 2022 2021 2020 2019
6
For more information on how we calculate our ESG-related
data, see our ESG accounting principles
7
Rate of work-related injuries per 1,000,000 hours.
8
Rate of work-related injuries with lost time per
1,000,000 hours.
9
Includes both TDC NET and DKTV employees.
10
The number is calculated as follows: MWh of electrical
energy / PB of data throughput.
11
The number was calculated as follows: tCO
2
e of Scopes 1
and 2 market-based emissions / PB of data throughput.
2023 2022 2021 2020 2019
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Income statement (DKKm)
Revenue
6,461
6,639
6,674
6,828
7,050
Gross profit
6,225
6,377
6,356
6,447
6,588
EBITDA
4,695
4,520
4,498
4,434
4,415
Operating profit (EBIT)
1,691
1,979
2,036
1,409
1,043
Profit before income taxes
(207)
2,390
1,384
804
462
Result for the year
(364)
1,918
1,040
604
364
Income statement, excluding special items
(DKKm)
Operating profit (EBIT)
1,769
2,029
2,132
1,448
1,119
Profit before income taxes
(129)
2,440
1,480
843
538
Result for the year
(303)
1,957
1,115
634
425
Balance sheet (DKKm)
Total assets
34,716
36,420
30,244
28,583
27,826
Total equity
1,867
2,964
9,796
8,756
8,152
Capital expenditure (DKKm)
(3,037)
(3,248)
(3,134)
(3,971)
(3,206)
Statement of cash flow (DKKm)
Operating activities
3,327
3,195
2,961
4,315
3,582
Investing activities
(2,933)
(5,478)
(3,473)
(3,282)
(3,478)
Financing activities
(784)
4,517
520
(1,030)
(103)
Total cash flow
(390)
2,234
8
3
1
Equity free cash flow
1
93
(389)
(767)
718
(146)
Key financial ratios (%)
EBITDA margin
72.7
68.1
67.4
64.9
62.6
Capital expenditure/revenue ratio
47.0
48.9
47.0
58.2
45.5
Net interest-bearing debt (NIBD)
24,823
24,814
15,918
14,636
15,667
NIBD/EBITDA
5.29
5.49
3.54
3.30
3.55
Adjusted net interest-bearing debt (NIBD)
2
23,552
23,770
12,641
11,874
12,640
Adjusted NIBD/EBITDA
3
5.40
5.65
3.01
2.88
3.07
Revenue generating units (RGUs ('000))
Total broadband RGUs
1,086
1,192
1,276
1,331
1,406
High-speed RGUs
4
792
791
757
699
647
Low-speed RGUs
4
293
400
519
632
759
Operational KPIs
Homes passed fibre ('000)
5
702
607
497
391
269
Homes passed coax ('000)
1,303
1,325
1,331
1,329
1,342
100 Mbps population coverage (%)
70
70
71
70
70
1000 Mbps population coverage (%)
49
49
47
46
43
4G mobile geographic coverage (%)
99
99
99
99
99
5G mobile geographic coverage (%)
99
99
99
78
0
People & sustainability KPIs
6
FTEs end-of-year (#)
2,630
2,818
2,864
2,556
2,524
Number of fatalities
0
0
0
0
0
Total recorded injuries frequency rate (TRIFR)
7
23.5
19.8
18.9
20.0
16.2
Lost time incident frequency rate (LTIFR)
8
5.2
6.1
8.0
7.6
6.2
Percentage of management positions
filled by women
9
(%)
24
19
23
18
-
Number of whistleblower reports submitted
9
2
0
1
-
Energy intensity
10
7.8
9.2
9.8
11.0
12.1
Emissions intensity
11
1.4
3.6
4.5
4.7
5.1
Waste recycled (%)
73%
70%
71%
65%
-
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
We connect Denmark.
For everyone.
TDC NET is an open-access connectivity provider
of digital infrastructure. We build, own and
operate the next generation of Denmark’s fixed
and mobile networks. Denmark has a leading
position within digitalisation across the
EU, and TDC NET plays an important role
in enabling society’s transition to a green
and sustainable future.
We directly enable
society’s green digital
transition through our
resilient and stable 5G
mobile network and
fixed connections
Core business
We procure network
equipment from
manufactures and
sub-contractors e.g.
mobile antennas
and fibre cables
We build and maintain
high-speed mobile network
and fixed connections.
We sell, and provide service
providers with access to
TDC NET’s network.
The operational
responsibilities of selling
network access and services
to end users are handled by
service providers. Afterwards
TDC NET is reclaiming the
service chain for the underlying
infrastructure.
We install and maintain
infrastructure at
end users.
Our business model
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•
989 field technicians
•
•
•
•
702k homes passed with fibre
•
EBITDA: DKK 4,695m
•
•
•
Our business model
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Resources
Our people
•
2,630 FTEs
•
24% women/76% men
in leadership across all
leadership levels
Infrastructure assets
•
4,181 mobile sites in Denmark
19,750 km transport fibre
network in Denmark
Financial liabilities
•
EUR 1.5bn in sustainability-
linked bonds
EUR 3.4bn in total bond and
term loans
Suppliers and partners
•
3,527 suppliers
Partnership with Ericsson to
build green mobile network
Founding member of European
Green Digital Coalition
Partnership with Joint Alliance
for CSR (JAC)
Climate commitment
•
Four solar parks cover 71% of
our electricity consumption
with renewable electricity
↓ ↓ ↓ ↓ ↓
Value
created
TDC NET as an employer
•
High employee loyalty: In our
annual employee satisfaction
survey, the question “I would
like to be employed at my
company in two years’ time”
scored 82.
88% completed voluntary
security training
94% completed GDPR training
Connecting Denmark
•
DKK 3bn invested in new
infrastructure
•
Largest broadband footprint
in Denmark, covering 95% of
all residential addresses
4G and 5G network with 99%
national coverage
Financial performance
•
Revenue: DKK 6,461m
•
EBITDA growth: 3.9%
Capital expenditure:
DKK (3,037)m
Responsible supply chain
•
New Scope 3 guidance for
Telecommunication Operators
6 JAC audits
Reduced environmental impact
•
31% reduction in total CO
2
emissions compared with
2022
Scopes 1 and 2: 59% reduction
compared with 2022
Scope 3: 5% reduction
compared with 2022
931.5 metric tonnes waste
recycled
↓ ↓ ↓ ↓ ↓
Contri-
bution to
society
•
2,630 FTEs paying taxes
•
For the eighth year in a row,
the Danish Technological
Institute has measured our
mobile network as the best in
Denmark.
•
DKK 234m paid in income tax
•
178 factories in TDC NET’s
supply chain with on-site JAC
audits
•
52,994 tonnes less CO
2
compared with 2022
195.5 GWh of solar power
added to the Danish grid,
corresponding to the
average annual electricity
consumption of 122,188 Danes
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•
•
•
•
•
•
•
•
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Our strategy and priorities
We are guided by our purpose to connect Denmark for everyone and are committed to placing
Denmark on the map as a world-renowned front-runner in connectivity. Our strategy is centered
around customer experience, sustainability and technology innovation
to make Denmark a green digital pioneer.
We want to be the...
Leading Customer-centric Green TechCo
We offer Denmark’s
leading high-speed
connectivity across
mobile and fixed with
nationwide scale
We deliver an excellent
customer experience by
placing the customer
at the core of our
technology offerings
We drive technology
innovation to realise
sustainable operations
for our customers,
society and the planet
We pioneer ‘hybrid digital collaboration’ to develop and attract tomorrow’s talent,
building on our passionate, inclusive and courageous culture.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Leading high-speed connectivity
Providing state-of-the-art networks is our overarching promise to our customers, their
customers and society at large, in alignment with our commitment to the UN SDG 9 of
building resilient and sustainable infrastructure. We offer Denmark’s leading high-speed
connectivity across mobile and fixed connections, and our scale allows us to deliver high-
quality offerings nationwide.
Mobile
We are the undisputed market leader in best
mobile network experiences, as measured
by the Danish Technological Institute for the
eighth year running, an achievement that
directly impacts both our customers and
their customers every day. We invest heavily
in maintaining both the best and most
innovative mobile network, therefore we are
proud to say that we are the only Danish
telecommunications provider with a fully-
fledged 5G network offering more than 99%
nationwide coverage. In 2023, we achieved
faster and more error-free up- and downloads
than ever before.
Fibre
We are tirelessly rolling out fibre to Danish
homes and businesses to achieve our
ambitious goal of connecting more than one
million households with fibre by 2030. In 2023,
we completed additional fibre roll-out to
approximately 95k Danish households – more
than any other competitor in the Danish
market. As a result, we remain Denmark’s
largest high-speed broadband provider,
offering coverage to around 1.7 million homes.
Fixed priorities
With this strong progress on fibre coverage,
our focus on activating the network is
increasing. We are already seeing the impact
of new, strategic initiatives with a record-
high fibre activation rate that has increased
by more than 30% compared with last year.
The focus on unlocking the full potential of
our fibre platform will continue in 2024 and
is a strategic addition to our best-in-class
coax platform, which is already delivering
stable high-speed connectivity across
Denmark. All our platforms are enhanced by
our massive investments in a next generation
core network. Further strengthening our
edge on our core network with market-
leading reach, allows us to continuously
offer highly secure and robust connections.
Besides benefiting private customers, this
sustains our competitive edge towards Danish
businesses as the foundation for national
and international growth. Our capabilities
and robustness have in 2023 granted us the
privilege to deliver and operate the Danish
Safety Network (the nationwide critical SINE
network) until at least 2031 in collaboration
with TDC Erhverv.
We offer Denmark’s
leading high-speed
connectivity across
mobile and fixed with
nationwide scale
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Excellent customer experience
We deliver an
excellent customer
experience by placing
the customer at the
core of our technology
offerings
As a provider of critical infrastructure, we are committed to meeting
evolving demands. We work relentlessly to deliver an excellent customer
experience by placing customer at the core of our technology offerings.
Network quality
For a open network provider that
collaborates with a broad range of service
providers, the foundation for an excellent
customer experience is to ensure the same
stable, secure and reliable connectivity for
all partners and end customers. Therefore,
we are investing in IT-enabled solutions
to enhance monitoring and to enable
automation of testing and changes – with
the aim of minimising incidents and enabling
swift service restoration. Our stand-alone
business model warrants that all customers
benefit from TDC NET’s superior connections,
regardless of their choice of service provider.
Customer journey
Our customer experience programme,
launched in 2022, highlighting our fibre
customer journey, has already paid off. We
have delivered a step change in First-Time-
Right for fibre installations, now at >98% for
fibre installations with technician visits. As
part of our new transformation, we have
broadened the scope further by including all
end-customer touchpoints to ensure that our
investments contribute directly to a better
customer journey. As an example, we have
developed an AI-enabled do-it-yourself fault
handling tool with one of our customers to
allow faster and easier fault repairs. We
aspire to make every customer interaction
with TDC NET a professional, seamless and
flawless experience.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Innovation & sustainability
At TDC NET, our vision to make Denmark a digital pioneer goes beyond cables and radios.
As a stand-alone network provider, we consistently concentrate on strengthening our core
network capabilities. We drive technology innovation to realise sustainable operations for
our customers, society and the planet – ensuring that we always have a positive impact on
the world around us.
Simplification
A key strategic priority is to streamline,
simplify and standardise our operations to
efficiently pave the way for new technologies.
A company-wide transformation was
launched at the beginning of 2023 to
orchestrate cross-functional efforts, including
process optimisation, IT modernisation,
data enablement and people mobilisation.
The transformation reaches far into all
business areas to ensure that our strategy
is strongly anchored in daily operations.
Through controlled decommissioning of
selected platforms, the simplification process
includes replacing old technologies. Like our
peers in neighbouring countries, we have
announced that our copper network will be
decommissioned by 2030. The first customer
migrations have already started in 10
carefully selected areas.
Closing the copper network aligns with our
strategic objective of streamlining operations,
enhancing product sustainability through
energy-efficient solutions, and crucially,
enabling us to effectively address rising
customer needs for high-speed connectivity.
Digitalisation
By simplifying our business and procedures,
we can unleash the potential from digital
technologies such as automation, machine-
learning models and artificial intelligence. The
digital agenda is a top priority for TDC NET,
with strategic investments enabling us to
secure operational consistency, improve
decision making and assist technicians with
improved tools. During 2023, we nearly tripled
the size of our AI team with top talents
dedicated to delivering on value-driven
use cases. Highlights include developing a
fault prediction algorithm to help prevent
specific coax faults, a real-time technician
support chatbot pilot, as well as use cases for
advanced fraud detection.
ESG
In 2022, we were the first company in
the world to have a 2030 net-zero target
validated by the Science Based Targets
initiative – an achievement that clearly
underlines our leadership position on the
climate agenda. We are now expanding our
environmental commitment to include nature
and biodiversity. For the broader ESG agenda,
we also aim to lead the field within social and
governance-related areas such as health &
safety, diversity & inclusion, digital trust and
business conduct.
We drive technology
innovation to
realise sustainable
operations for our
customers, society
and the planet
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
People mobilisation
Mobilising our organisation is fundamental
for succeeding with our transformation
and strategy. We pioneer ‘hybrid digital
collaboration’ to develop and attract
tomorrow’s talent, building on a passionate,
inclusive and courageous culture.
People
We are firm believers in passionate people
driving technology and not vice versa. We
are therefore committed to creating the best
possible foundation for our employees to
do so. We have previously implemented our
‘Pioneering Digital Collaboration’ concept
as our way of working, and continuously
evaluate how to provide our employees with
more flexibility and further enable cross-
organisational collaboration. We closely
assess how we organise our company to face
the future and support technology shifts
while also making sure our talent pool is filled
with the capabilities required for tomorrow.
All these elements are tied together by the
passionate, inclusive and courageous culture
that empowers our organisation.
We pioneer ‘hybrid
digital collaboration’
to develop and
attract tomorrow’s
talent, building on a
passionate, inclusive
and courageous culture
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Addressing
our material
impacts
TDC NET’s materiality analysis helps us identify
environmental, social and governance (ESG)
issues that either have a large potential impact
on TDC NET’s business or a potential negative
impact on society. We respond to the most
material issues via sustainability programmes for
each of our sustainability priorities.
Materiality process
Our materiality approach builds on guidance from international
reporting standards such as the Global Reporting Initiative
(GRI). The analysis is conducted in depth every third year, most
recently in 2021, and is revised annually to ensure continued
relevance of the ESG issues. In 2023, our annual revision led to
slight adjustments in our materiality matrix. Material issues
are identified and evaluated through a comprehensive process
based on internal and external input. Key internal stakeholders
are consulted via interviews, including board members,
Infrastructure development
Health and safety Cyber security
Business conduct
Renewably energy
Human & labour rights
Regulatory compliance
GHG emissions
Digitalisation
Data privacy
Energy efficiency
Corporate governance
Diversity and inclusion
Biodiversity
Responsible
supply chain
Transparency reporting
Training and education
Circularity
Social initiatives
Water management
Materiality assessment
and matrix
Inputs for materiality
assessment
•
Board interviews
•
Executive workshops
•
Investor interactions
•
Management interviews
•
Regulatory analysis
•
Society perspectives
•
Supplier engagement
•
Trends research
Results from
materiality assessment
(average of scores)
Environmental
Social
Governance
Key changes
High
Relative significance of impact on business
Very high
High
Relative importance to stakeholders
Very high
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
executive leadership and selected employees. Stakeholder
insights are combined with analyses of external reports,
sustainability trends and peer strategies.
The result of the assessment is shown in our materiality
matrix. The upper right quadrant covers issues most relevant to
TDC NET’s stakeholders and with the greatest possible impact
on our business. The relative significance of the impact on our
business is calculated as an average of stakeholder input based
on the principle of double materiality. This means topics scored
high on impact (horizontal axis) indicate a large potential
impact on our business and/or an opportunity for TDC NET to
mitigate an impact on society.
In the 2023 assessment, biodiversity was identified as material.
We have therefore expanded our focus on the climate priority
area to include nature. Several governance-related issues
increased in level of importance and impact, leading to the
inclusion of a new sustainability priority area ‘Governance,
compliance and conduct’, which also creates a foundation for
the remaining priority areas. Infrastructure development and
digitalisation continue to be part of our core business.
Preparing for double materiality
As part of our ongoing preparations for complying with the
EU Corporate Sustainability Reporting Directive (CSRD), we
are running a process to update the materiality assessment
to ensure full alignment with the double materiality approach
as stated in the CSRD and related European Sustainability
Reporting Standards.
Focusing on the most material issues
The materiality matrix indicates which ESG issues are most material. ESG Leadership addresses
the most material issues through five different sustainability priority areas.
ESG area
Most material issues
Strategic priority areas
Environment
Energy efficiency
GHG emissions
Renewable energy
Biodiversity
Climate and nature
Social
Diversity and inclusion
Health and safety
Diversity and inclusion
Health and safety
Governance
Cyber security
Data privacy
Business conduct
Corporate governance
Regulatory compliance
Infrastructure development
Digitalisation
Digital trust
Governance, compliance
and conduct
Part of our core business
Our sustainability priorities
Climate and
nature
Achieve zero
negative climate
and nature
impacts from our
business
Health and
safety
Become one of the
safest places to
work
Diversity and
inclusion
Ensure equal
opportunities and
an inclusive culture
Digital
trust
Protect the network,
personal data and
privacy rights
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Our direction for sustainability
ESG Leadership sets the strategic directions
for our sustainability work towards 2025.
As an outcome of the latest materiality assessment revision,
we will focus on driving progress within the following five
sustainability priorities:
•
Climate and nature
•
Health and safety
•
Diversity and inclusion
•
Digital trust
•
Governance, compliance and conduct
Ambitions, targets and initiatives have been defined for the
first four priority areas – and we closely monitor progress
towards targets to deliver clear results. For ‘Governance,
compliance and conduct’, short-term targets will involve
compliance with the CSRD and NIS2. Long-term targets will be
defined in 2024 as part of this process.
Decision making related to our sustainability priorities is
anchored with our Executive Leadership Team and Board of
Directors, including Board-level committees.
ESG Leadership
Sustainability as a core element of the corporate strategy and transformation
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Governance, compliance and conduct
Ensure strong governance, compliance and good business conduct
Futureproof digital infrastructure
Build reliable, resilient and sustainable digital infrastructure
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Our direction for sustainability
Supporting the UN Sustainable Development Goals
TDC NET is an active participant in the UN Global
Compact. Since 2009, we have supported its 10 principles on
environment, human and labour rights and anti-corruption. We
are committed to contributing to achieving the UN Sustainable
Development Goals (SDGs) by maximising our positive impact
and reducing our negative impact on the environment and
society. We support relevant SDGs through our different
sustainability priorities and related initiatives.
Driving progress across programmes
To drive progress in our sustainability priorities, we follow a
systematic approach – from defining a situation to execution
and evaluation. For each priority area we:
1. Outline the situation and targets to establish a solid
baseline.
2. Define topics and initiatives in close collaboration with the
business.
3. Develop roadmaps to reach the targets. Roadmaps and
key initiatives are subject to approval by the Executive
Leadership Team and the Board of Directors.
4. Execute in collaboration with relevant business units to
integrate initiatives in day-to-day operations.
5. Track and report on progress to ensure alignment with
targets.
6. Share consolidated quarterly reporting with the executive
management in internal governance forums, where
evaluation and adjustments are decided.
See TDC NET’s corporate governance model, including
sustainability governance, on page 60 →
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6,461
Revenue
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
In 2023, we maintained a flat development in revenue and continued
the declining trend in our operational costs. Through our power purchase
agreement we successfully lowered our power costs contributing to an
increase in EBITDA of 3.9% year-on-year. This allowed us to continue the high
investment level in our fixed and mobile networks.
Revenue split in products
(DKKm)
total revenue 2023.
Revenue
Revenue amounted to DKK 6,461m. The
decrease of 2.7%, relative to 2022, was driven
primarily by a decline in our legacy products.
Our mobility services generated DKK 2,717m,
corresponding to a decline of 1.1% or DKK
31m lower than in 2022. The reduction was
attributed primarily to decreased electricity
prices on mobile sites influencing gross profit
but not impacting EBITDA. Furthermore,
mobile revenue was impacted by reduced
streams from other operators concerning the
National Roaming Agreement, aligning with
the anticipated infrastructure development
by fellow Danish operators. The negative
effects were partly outweighed by increased
prices on the mobile network, which cover
the capacity expansions required for future
traffic. Our mobile network market share in
2023 remained stable at ~40%.
Revenue from internet and network increased
by 0.8%, or DKK 20m, to DKK 2,411m in 2023.
The increase in revenue is attributed to price
adjustments across all technologies, coupled
with a shift in our customer base towards
faster and more resilient technologies with
higher average revenue per user (ARPU).
Despite maintaining a stable customer base
on high-speed technologies, our market
share experienced a decline from 48% to
44% in 2023. This signals an acceleration in
the consumer transition towards high-speed
technologies, posing considerations for our
revenue and market positioning.
The decline in landline voice revenue of 15.2%
or DKK 69m, totalling DKK 386m in 2023,
aligns with prevailing market trends. The
reduction in the customer base was partially
mitigated by a PSTN price increase.
Other services experienced a 9.4% or DKK 98m
decrease, amounting to DKK 948m, driven
primarily by TV and technician services as a
result of a smaller broadband customer base.
Landline voice
Mobile services
Internet & network
Other services
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6%
42%
15%
37%
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Operational costs
and EBITDA
Operational costs
Operational costs (opex) totalled DKK 1,530m in
2023, which was DKK 327m lower than in 2022.
The reported cost decline was a result of the
efficiency improvements stated below.
Personnel-related costs amounted to DKK 994m,
which was DKK 33m or 3.2% lower compared
with 2022. Within our field force, efficiency was
improved as a result of fewer faults at customer
premises leading to -8.0% fewer FTEs. This was
the main driver for the FTE reduction of 6.7%
across the company.
External expenses totalled DKK 914m, down
DKK 188m or 17.1% compared with 2022. The
effiency improvement was mainly driven by
our mitigation of the electricity prices through
sourcing of renewable energy from our power
purchase agreements resulting in lower spend
on power costs in 2023. Renewable electricity
from our four solar parks covered 71% of our
total electricity consumption in 2023. Further
improvements were successfully achieved
through renegotiated supplier contracts.
EBITDA
EBITDA reached DKK 4,695m in 2023, which
was DKK 175m or 3.9% higher than in 2022.
This was achieved through lower operating
expenses combined with our improved
gross profit margin of 96.3%, resulting in an
improved EBITDA margin of 72.7% in 2023
compared with 68.1% in 2022.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Result for the year and
capital expenditures
First European company to fully
retire legacy voice technology with
heavy power consumption
In 2023, we reached a milestone in TDC NET’s corporate history as we
successfully implemented one of the most substantial technological
transformations in the company’s history. This achievement involved
migrating 112 services from legacy technology to advanced mobile
Net financial items
The net financial items totalled in DKK (1,898)m in
2023, corresponding to a decrease of DKK (2,309)m
compared with 2022. The development was driven
primarily by an unrealised fair value adjustment
related to the hedge of the floating Senior Term
Facility loans. TDC NET hedges the risk of future
interest increases via interest rate derivatives and
fixed rate loans. As interest rate have decreased
significantly in 2023 there is a unrealised mark-to-
market loss on the hedging derivatives of DKK 422m
compared with a gain of DKK 1,144m in 2022 due to
increasing interest rates during 2022. The fair value
fluctuations reflect a longer-term hedging strategy,
which is affected by the development in interests.
Income tax
Income taxes decreased from DKK (472)m in 2022
to DKK (157)m in 2023. The tax expense in 2023
was primarily a result of the limitation on the
tax-deductibility of unrealised fair value losses on
interest rate hedges of Senior Term Facility loans
due to the Danish interest limitation rules.
Result for the year
Result for the year decreased by DKK 2,282m
to DKK (364)m in 2023, driven primarily by an
unrealised fair value adjustment of DKK 2,162m
related to the hedge of the floating Senior Term
Facility loans. The strong operational result in 2023
was impacted by software write-down of DKK
265m and the unrealised fair value loss of DKK
422m attributable to our hedging strategy of the
floating Senior Term Facility loans.
Capital expenditure
Capital expenditure amounted to DKK 3,037m
in 2023, which was a decline of DKK 211m in
investments spend compared with 2022. The
investment level in our core business remained at the
same high level as in 2022, as we continued our focus
on ensuring Denmark's best mobile network and
rolling out fibre as well as connecting more homes to
our high-speed platforms. In 2023, investments was
also made in moving a critical services from power-
intensive legacy technologies to a more advanced
and resilient technology platform.
technology. Through the migration we achieved a decline of 6% in
electricity consumption from 2022 to 2023, driven by the large-scale
national decommissioning of fixed network legacy technology.
The initiative impacted on a broad range of private consumers, including
telephone numbers preceded with 70 and 80, critical community
customers, over 300k landline customers, and essential emergency
services numbers such as 112 and 114. Furthermore, the project extended
its reach to substantial portions of TDC NET’s network. The programme
also included a major clean-up of our old transmission network, where
customers’ landline circuits have been migrated to fibre. Similarly,
international traffic and traffic exchanged with other operators have
been migrated from ISUP to SIP.
This initiative had to be planned with utmost precision to avoid
interfering with critical services and is a testament to our commitment to
streamlining operations and ensuring the future resilience of our business.
With this project completed, we bid farewell to a core element of our
corporate history as a telephone company, which propels us towards our
goal of becoming the leading supplier of data networks in Denmark.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Equity, cash flow and funding
Equity
During 2023 total equity decreased from DKK 2,964m to DKK
1,867m as of 31 December 2023. This decrease was a result
of the non-cash dividend to TDC Holding (DKK 750m) as well
as the loss for the year DKK (364)m. The non-cash dividend
financed TDC Holding's partial repayment of the upstream
loan that decreased to DKK 1,438m including accrued interests
at year-end 2023.
Cash flow
In 2023, we achieved a positive Equity Free Cash Flow (EFCF) of
DKK 93m from our operating and investing activities, notably
due to improved EBITDA of DKK 175m achieved through opex
efficiencies and effective working capital management, which
contributed an additional DKK 93m. This was accomplished
despite the increase in net interest paid of DKK 232m,
partly offset by lower corporate tax, further cementing the
company's strong performance.
We proactively implemented a series of initiatives aimed
at optimising cash flow. These actions were deployed to
efficiently manage our receivables and payables, as well as to
actively manage and prioritise our investment pipeline within
the constraints of maintaining a positive cash flow while
increasing our fibre roll-out.
Cash flow related to financing activities was impacted by the
debt refinancings during the year (see details in the funding
section). The total cash flow from financing activities for 2023
related mainly to debt proceeds raised at the end of 2022 and
used for debt repayments in 2023.
Funding and liquidity
We are investing in the digital future of Danish society by
rolling out fibre and regularly increasing of mobile network
capacity. The significant strategic investments were funded
by the operational cash flow in 2023. However, continued
access to funding markets is important for refinancing the
existing debt portfolio and securing the continued strategic
development of our company.
On 31 January 2022, we established a long-term secured
infrastructure financing platform and under this platform, we
entered our first financings in the aggregate amount of EUR
3,300m. We have a diversified debt portfolio including term
loans, bonds, revolving credit and liquidity facilities. Since
the first financing, we have issued three sustainability-linked
Euro Medium Term Notes (EMTNs) in the public markets with
each issuance in benchmark size and of total volume of EUR
1.5bn. Two of these benchmarks were issued in 2023 totalling
EUR 1bn. The instruments issued are rated BBB- (stable) by
Fitch. The Eurobonds are linked to our sustainability targets
of becoming a net-zero carbon emission company across the
full value chain (Scopes 1, 2 and 3) by 2030. In the private
markets since our first financing, we have entered into four
bilateral loans with relationship and infrastructure banks of
EUR 285m and DKK 400m. All facilities are issued under the
secured financing platform. As a part of the funding strategy
to diversify funding and prepay term loan facilities, the
proceeds have been used to partly prepay the original term
loan facilities.
We target sufficient liquidity and had a cash balance of DKK
1,855m at year end and an undrawn revolving credit facility of
EUR 350m. The cash will be spent on strategic infrastructure
investments, debt refinancing and cash management in
general. We do not have financial debt with contractual
maturities in 2024. However, the funding plan during 2024 is to
explore and potentially diversify funding into Eurobonds, local
bonds, private placements and bilateral loans. As we prepare
for the prepayments of the term facilities maturing in 2027, we
expect to fund between EUR 0.5bn and 1.5bn, depending on
capital market opportunities and cash flow during 2024.
We plan to build a diversified maturity structure and a
diversified investor base and engage in regular investor relation
activities, meeting investors one to one, and on earnings
release call. As of 31 December 2023, our NIBD totalled DKK
24,823m (including an upstream loan to TDC Holding) and
DKK 26,261m (excluding an upstream loan to TDC Holding).
The outstanding debt has an average contractual maturity
of more than four years and the interest rate risk in respect of
such debt is fully hedged with fixed rate bonds and long dated
interest rate swaps.
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6.4 –
4.5 –
3.0 –
6.5 –
3.0 –
Guidance
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
2023 guidance achieved
Our 2023 performance aligned with our financial guidance. We
achieved a relatively flat revenue of DKK 6,461m driven by an
expected decline in legacy products. The single-digit increase
in EBITDA of 3.9% was driven primarily by a decrease in opex
of DKK 1,530m caused by lower power prices in 2023 combined
with opex efficiencies. In 2023, we kept a stable investment
level of DKK 3,037m as we remained focus on our status as
Denmark’s best mobile network and rolling out fibre.
2024 guidance
In 2024, we anticipate maintaining the flat revenue trajectory,
with sustained growth in mobile and high-speed broadband
offerings likely to be partly offset by the declining trend from
legacy products. EBITDA for 2024 is expected to be same
level as 2023, driven by our focus on reducing complexity and
increasing efficiency. We continued our heavy investments in
both end-to-end transformation and core business activities.
This highlights our focused dedication to ongoing initiatives
such as mobile and fibre roll-out, aimed at enhancing our
customer experience. Notably, our capital expenditure
investments remains adaptable, with regular assessments to
determine whether adjustments are needed to meet changing
business needs.
Revenue
6.8bn
EBITDA
4.8bn
CAPEX
3.4bn
Revenue
6.8bn
~4.7bn
CAPEX
3.5bn
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EBITDA
Sustainability priorities
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
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Delivering
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Climate and nature
historic CO
2
reductions of
44%
Our approach to the climate and nature
TDC NET is highly committed to minimising its environmental
impact and leading the way for climate and nature action.
We believe that companies – like us – that have the best
conditions to reach net zero as fast as possible should take the
lead on climate action. While we work diligently to reach our
net-zero target across our full value chain by 2030, our digital
infrastructure is underpinning the green digital transition of
Denmark.
With locations all over Denmark, we are committed to
rethinking our nature footprint and will work to preserve 30% of
TDC NET’s land by 2030.
Electrifying special vans
Carbon emissions related to TDC NET’s fleet are a large
proportion of our direct emissions. To eliminate our Scope
1 emissions, we have a goal to electrify our entire car fleet,
including special vans, by 2028. This is a key initiative for reaching
net zero across Scopes 1 and 2 by 2028.
However, converting to electric vans has proven slightly more
challenging than expected. Our fibre technicians need vans with
heating to perform their work in the field. Currently, no electric
vans on the market have incorporated heating solutions – which
is not just an issue for TDC NET, but any company with a business
similar to ours.
TDC NET is taking the lead in finding a solution for the market
and is therefore partnering with two vehicle conversion specialists
with expertise in converting regular vans into special vans.
These specialists are testing various solutions to be ready with
prototypes for an electric fibre van in February, 2024.
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Ambition:
Achieve zero negative
climate and nature impacts
from our business
Targets:
•
100% renewable energy in
operations by 2028
•
Net-zero CO
2
on Scopes 1 and 2 by
2028 and Scopes 1, 2 and 3 by 2030
•
30% preserved land by 2030
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Automating ESG data
From January 2024, TDC NET’s ESG reporting will
be in scope for the EU Corporate Sustainability
Reporting Directive, thereby increasing the
reporting requirements and scope of ESG data
transparency and granularity.
So far, ESG data collection and consolidation
have been handled manually across TDC NET,
requiring considerable people resources, e.g. to
calculate our Scope 1, 2 and 3 emissions on a
monthly, quarterly and annual basis. To increase
data accuracy and accommodate this increased
workload, TDC NET is investing in automating
its ESG data collection, consolidation and
verification.
Since summer 2023, a dedicated group of finance
specialists, data engineers and sustainability
experts have worked to map data sources and
flows in order to onboard raw data to TDC NET’s
data system automatically for consolidation.
Utilising our data system’s transparent and
explicit data lineage means that the calculation
process and all data transformations can be
traced from final KPIs back to the raw data
received from various data sources.
Our validated 2022 data is used for
benchmarking, and the project group has
succeeded in replicating automated 2022 data
with 99.9% accuracy, proving that our manual
data handling has been solid.
For this report, the compilation of the following
KPIs have been automated: energy intensity,
carbon intensity, electricity, heat, transport,
total energy consumption, Scope 1 and 2 related
data points as well as share of renewable
electricity.
In 2024, we plan to expand the automation to
other ESG areas that are material for TDC NET’s
reporting and where considerable efficiencies
can be realised, such as Scope 3, waste data and
social data. The idea is also to utilise ESG data
to create and realise business value, e.g. related
to electricity savings and car fleet control.
Environmental governance
TDC NET’s commitments to the environment and climate are
expressed in our Sustainability Policy.
The Board of Directors oversees our climate and nature
programmes and performance data, while our Climate
Forum ensures execution across our climate and nature
initiatives. TDC NET is ISO 14001 certified, with 100% coverage.
Environmental risk assessments as well as internal and external
audits are performed as part of the certification. Large
environmental risks are also reported to the Board of Directors
as part of TDC NET’s Enterprise Risk Management process.
Validated net-zero targets
TDC NET’s net-zero targets are aligned with the latest climate
science and validated by the Science Based Targets initiative.
We want to be net zero in our own operations by 2028 and
across our entire value chain by 2030.
We are proud to be blazing a trail towards our net-zero target
and hope other companies are inspired to follow.
2023 results and performance
In 2023, total carbon emissions across the entire value chain
decreased by 31% (52,994 tonnes CO
2
e) compared with
2022 and by 44% (90,168 tonnes CO
2
e) compared with 2020.
This achievement is driven by our investment in renewable
electricity, relative adjustment and lower intensity of supplier
emissions. Improvements were also achieved across our energy
and carbon intensity rates as well as in waste management.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Scope 1, 2 and 3 results
In 2023, we benefited from the full-year effect of receiving
renewable electricity from our four solar parks and thereby
achieved our near-term target of 50% reductions across
Scopes 1 and 2. Our Scope 1 and 2 market-based emissions
decreased by 59% (48,235 tonnes CO
2
e) compared with 2022,
and 59% (47,875 tonnes CO
2
e) compared with 2020. We also
took significant steps towards reaching our target of 100%
renewable energy by 2028 and now cover 71% of our electricity
consumption with renewable energy.
We reduced our Scope 3 emissions by 5% (4,759 tonnes
CO
2
e) compared with 2022 and by 34% (42,293 tonnes CO
2
e)
compared with our 2020 baseline. This achievement was driven
mainly by relative adjustment and our continued focus on
reducing suppliers emissions through our supplier engagement
programme.
Assessing and calculating Scope 3 emissions is a complex
process, as these emissions are not under our direct control,
and we often lack reliable industry-based data. To increase
coverage and transparency regarding telecoms operators’
Scope 3 accounts, TDC NET was a leading author of the ‘Scope
3 Guidance for Telecommunications Operators’, published
by ITU, GSMA and GeSI in 2023. This guidance harmonises
methods for telecoms operators to assess and report their
Scope 3 greenhouse gas emissions. The guidance is intended to
supplement, not supersede, existing standards.
We report our emissions in line with the World Business Council for Sustainable Development GHG Protocol methodology, which classes emissions in three groups: Scopes 1, 2
and 3. Our Scope 1 emissions result from the fuel in our vehicles, the oil in our backup generators and other energy sources we use in our operations. Our Scope 2 emissions are
from the electricity we purchase to power our operations, and heat from district heating. Our Scope 3 emissions are generated in the upstream and downstream value chain.
Energy and carbon intensity
Our energy intensity declined by 15% compared with 2022,
while our network carried 7.2% more data. This was driven
by our continued focus on activating customers to use the
most energy-efficient digital infrastructure: our 5G and fibre
networks. Our carbon emission intensity declined by 62% as
expected, based on the achievement of our 50% reduction
target across Scopes 1 and 2.
Total carbon emissions
(Scopes 1, 2 and 3 - market-based)
metric tonnes CO₂ e
207,078
195,190
169,904
126,012
105,052
88,478
116,910
72,825 72,199
83,719
24,751
8,241 9,228
2020 2021 2022 2023
Performance
Scope 1 Scope 2
0
2030
Target
Scope 3
8,440
81,873
8,265
Carbon emission intensity
(tCO
2
e of Scope 1 and 2 market-based
emissions / PB of data throughput)
5.1
4.7
4.5
3.6
1.4
2019 2020 2021 2022 2023
Performance
0
2030
Target
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Waste management
In 2023, TDC NET’s total waste volume increased by 1%, and
we recycled 73% of total waste generated from our operations.
26.9% of total waste went to energy recovery and incineration,
and 0.3% of total waste to landfill. We are committed to
increasing our focus on recycling in the years ahead.
In 2023, we launched waste e-learning for all employees to
encourage colleagues to sort waste correctly and thereby
create sources for recycling.
73%
of total waste recycled
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Outlook
In 2024, we expect to continue our progress on all
environmental KPIs and deliver short-term actions that
our planet needs. We expect to continue reducing our CO
2
levels by realising several large energy-saving projects both
in our network and car fleet. Furthermore, we plan to show
significant progress on our biodiversity target by launching a
nature project covering the first area of land we will preserve
for nature.
SDGs 7 and 13 in action
As a front-runner within climate action, we aim to
inspire others to follow. Our climate efforts support
the following SDG targets:
•
7.2 Increase substantially the share of renewable energy in the global
energy mix by 2030 (share of renewable energy)
•
2023 action: We achieved a share of renewable electricity of 71%
•
7.3 Double the global rate of improvement in energy efficiency by
2030 (data transport per kWh)
•
2023 action: We reduced our energy intensity by 15% compared
with 2022
Utilising surplus heat
Data servers generate considerable heat. At TDC NET’s Core
Site in Aarhus city centre, TDC NET has solved the problem
of how to utilise surplus heat. In collaboration with the local
district heating company, TDC NET has invested in a heat
pump solution.
The heat pump removes heat generated by the technical
equipment in the building, raises the temperature to district
heating temperatures and sends hot water out into the
building‘s radiators, ventilation systems and taps. This makes
the entire building self-sufficient in terms of heating while
eliminating the cost of disposing of waste heat in cooling towers.
Heat that cannot be utilised in the building is passed on to
the district heating network for the benefit of other district
heating customers in Aarhus. In 2023, the building generated
2,516 MWh heat for the district heating network, enough to
cover the annual heating demand of 168 apartments in Aarhus
City. This is based on the assumption that a standard size
apartment of 75m
2
uses 15 MWh heat annually.
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Our transition
Renewable energy
Cover 100% of energy consumption from
high-impact renewable energy sources.
Surplus heat utilisation
Utilise surplus heat from data centres and
equipment with e.g. heat pumps.
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Climate and nature
pathway to
net zero
Examples of initiatives
Own operations (Scopes 1 and 2)
Rest of value chain (Scope 3)
Committed to annual emissions reductions
TDC NET’s net-zero commitment and related roadmap to
reduce carbon emissions align with our 2030 business plan,
which includes our spend and investment trajectories as well
as our strong focus on energy efficiency, renewable energy and
supplier engagement.
tCO
2
e
207,078 195,190 169,904 116,910
Net zero
in own operations by 2028
in the entire value chain by 2030
2020 2021 2022 2023 2024* 2025* 2026* 2027* 2028* 2029* 2030*
Supplier engagement
Engage with top suppliers to set climate targets
and provide data transparency.
Other levers
Sustainable procurement, spend reduction and increase share of
services compared with goods.
* Committed targets
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81,066
126,012
90,138
105,052
81,426
88,478
33,191
83,719
Energy efficiency initiatives
Invest in the most energy-efficient technology and reduce network
energy consumption.
Green fleet transition
Optimise technician routes to reduce kilometres travelled by up to
25% and convert our fleet to electric cars and vans.
90,138
2023 in brief Our business Financial results Sustainability results Governance ESG statements
Sustainability Performance Report
Roadmap to Scope 1 and 2 net zero by 2028 for TDC NET
KPI (% of 2020 baseline). Thousand tonnes CO
2
e, 2020A-2028E
Achieved
Trajectory
100%
100%
111%
N/A
100% 41%
2
90% 50% 45% 40% 30% 25%
2020 2021 2022 2023 2024 2025 2026 2027
Achieved
Trajectory as defined in our Sustainability-Linked Finance Framework
Roadmap to Scope 3 net zero by 2030 for TDC NET
KPI (% of 2020 baseline). Thousand tonnes CO
2
e, 2020A-2030E
Achieved
Trajectory
100%
100%
83%
N/A
70% 66%
2
90% 85% 80% 75% 70% 65%
2020
Achieved
2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Trajectory as defined in our Sustainability-Linked Finance Framework
1 In accordance with the Sustainability-Linked Finance Framework and our policies, we have adjusted the 2020 baseline for Scope 3 from 120,323 tCo2e to 126,012 tCo2e. Furthermore the 2020 baseline for Scope 1 and 2 was adjusted in 2022. All adjustments are
made in good faith. Reference is made to the description of the recalculating event on page 36 and to detailed description of changes in our accounting principles for Environment on pages 82-84). The adjusted baseline is subject to assurance by our independent
assurance providers. Refer to pages 151-152 for the Independent Auditor’s Assurance Report on the ESG statement.
2 In accordance with our Sustainability-Linked Finance Framework, “achieved” performance on KPIs is subject to assurance by our independent assurance providers. Refer to pages 151-152 for the Independent Auditor’s Assurance Report on the ESG statement.
3 The figure has been adjusted compared with disclosed data in TDC NET Sustainability Report 2022. Corrections have been made to Scope 2 market-based emissions due to an update of the electricity and heat emission factors that occurred after last year’s
reporting.
81,066
1
81,426
3
33,191
126,012
1
105,052
88,478
83,719
Financial statements
Annual Report 2023
0%
2028
Second-Party
Opinion
In 2022, Sustainalytics
provided a Second-Party
Opinion on TDC NET's
Sustainability-Linked Finance
Framework and the associated
trajectories for Scopes 1
and 2 and for Scope 3. Both
trajectories were given the
scores of "Very Strong" and
"Highly Ambitious".
60%
45%
0%
Note: Following the occurrence of a recalculation event, we recalculate our 2020 baselines and adjust historical data to enable comparability year on year.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Sustainability Performance Report
In 2022, TDC NET established a Sustainability-Linked
Finance Framework (SLFF) and issued the first sustainability-
linked bonds, tied to our net-zero targets validated by the
Science Based Target initiative. In 2023, TDC NET issued two
sustainability-linked bonds, totalling EUR 1bn. This puts the
total of outstanding sustainability-linked bonds at EUR 1.5bn.
TDC NET has also engaged in a EUR 75m sustainability-linked
loan facility.
In addition to our long-term net-zero targets, we have set
annual CO
2
reduction targets for our Scope 1 and 2, and Scope
3 emissions. In the graph on the previous page, we show the
trajectory with individual annual targets towards net zero.
In alignment with the Greenhouse Gas Protocol and best
practice carbon accounting, we adjust our 2020 baselines
following the occurrence of a recalculation event. In
accordance with our SLFF and the Terms and Conditions of
our outstanding sustainability-linked bonds, a recalculation
event is considered the occurrence of 1) a significant change to
the structure of TDC NET or its subsidiaries or 2) a significant
change in methodology for calculating GHG emissions covered
by Scopes 1 and 2 or Scope 3 that requires a recalculation
for any reporting year. It is considered that the below-
mentioned adjustments constitute a significant change in
methodology pursuant to paragraph (b) of the definition of
a Recalculation Event. This is on the basis that each of the
types of adjustments set out below relates to significant
changes in methodology which require a re-calculation of the
2020 baselines and all adjustments are made in good faith
for purposes of ensuring that the Sustainability Performance
Targets are calculated on a consistent basis using comparable
data for the relevant reporting year and the 2020 baseline
year, respectively. We recalculate the 2020 baselines to ensure
consistency and comparability year on year.
Following the occurrence of a recalculation event comprising a
significant change in methodology (including implementation
of industry standards, new supplier data, new tools, databases
or upgrade of IT systems affecting this), we have recalculated
our 2020 baselines as follows:
• 2020 baseline, Scopes 1 and 2: 81,066 tonnes CO
2
e
• 2020 baseline, Scope 3: 126,012 tonnes CO
2
e
Net-zero
target 2020 baseline Reduction levers Investor targets
Net-zero
target 2020 baseline Reduction levers Investor targets
For more details, please refer to the Sustainability-Linked Finance Framework available on TDC NET's website under investor relations.
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Scopes
1 and 2
by 2028
Emissions driven by:
· 89% electricity use
· 10% transport
· 1% heat
· Energy efficiency initiatives Sustainability-linked bonds
· Renewable energy
· Green fleet transition
· Suplus heat utilisation
of EUR 1.5bn with penalty
if we fail to meet Scope 1
and 2 KPIs in 2026, 2027 and
2028, respectively.
Actuals
81,066 tonnes CO
2
e
Scope 3
by 2030
Emissions driven by:
· 84% purchased goods
· 8% fuel and energy
· 8% other
· Supplier engagement Sustainability-linked bonds
·
Sustainable procurement of EUR 1.5bn with penalty
·
Spend reduction if we fail to meet Scope 3
·
Increase share of services
KPIs in 2026, 2027 and 2028,
compared with goods respectively.
Actuals
126,012 tonnes CO
2
e
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Connecting
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Climate and nature
Danish nature
The state of biodiversity and nature is a
growing concern. With locations all over
Denmark, we are proud to take action.
The World Economic Forum estimates that 44 trillion dollars
are at risk due to the nature crisis, and the state of biodiversity
is closely linked to risks associated with climate change. COP15
in Montreal set a target of preserving 30% of land and 30% of
the sea by 2030. According to the Danish Biodiversity Council,
Denmark is far behind this target with only 1.6% protected
nature on land and 1.9% at sea.
Committing to 30 by 30
TDC NET has connected Denmark for more than 140 years.
Going forward, we want to connect not only Denmark, but
also preserve and connect Danish nature. We are therefore
expanding our climate leadership commitment to include
nature and biodiversity.
We have adopted the COP15 ambition and our target is to
preserve 30% of TDC NET land for nature by 2030.
Our nature footprint
TDC NET has a physical footprint on nature across Denmark and we
continue to interfere with nature when we build digital infrastructure.
TDC NET’s physical footprint on nature
Below the ground
+250,000 km of copper, coax & fibre network
cables
Above the ground
1
+6,000 sites distributed across Denmark
covering approx. 3.2 km
2
Below water
+4,000 km of sea network cables
Illustrative location of TDC NET sites
Location of largest sites (≥5,000 m
2
)
1 Total TDC NET rented and owned sites excluding 38
Nuuday stores and 9,262 cabinets (222 m
2
at stores and 0
m
2
at cabinets).
Illustrative map of TDC NET's footprint on nature
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Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Nature action now
With our 30 by 30 target in place, we are ready to take action
now. In 2024, we expect to onboard the first 10% of TDC NET’s
land as preserved nature areas, by giving 300,000 m
2
of land in
Skamlebæk, North-East Zealand, back to nature. The specific
plans and actions will be communicated throughout 2024.
To reach the remaining 20% of our commitment in the years
to come, we have our sights set on locations that will bring
us close to the target. We still have some unidentified
percentages to fulfil our ambition, but will work hard to close
that gap.
As with the climate agenda, we believe companies have a
shared responsibility to support nature and take action to solve
the challenges facing our planet. Therefore, we also encourage
other companies and the government to support the ambition
we have set for Danish nature.
One of the major challenges facing Danish nature is the
connection between larger nature areas and nature parks.
Companies in Denmark have smaller areas located between
nature areas, where we believe there is potential for creating
green corridors for nature. At the same time, the government
and public organisations can support concrete projects on
corporate land and show the strength of public-private
partnerships. Let’s connect Danish nature together – for
everyone.
“We are proud to be the first company in the
world to adopt the COP15 ambition with our
target to preserve 30% of TDC NET land for
nature by 2030.”
– Henrik Brandt, CFO, TDC NET
2023 in brief
SDG 15 in action
Our biodiversity efforts
support the following SDG target:
•
15.5: Take urgent and significant action to reduce
the degradation of natural habitats, halt the loss of
biodiversity and protect and prevent the extinction of
threatened species
•
2023 action: TDC NET’s Board of Directors approved
the new TDC NET biodiversity strategy targeting
30% of TDC NET’s land footprint for preservation by
2030
Health and safety
Health and safety governance
2023 in brief Our business Financial results Sustainability results
Providing a healthy
and safe working
environment
Our approach to health and safety
We provide a healthy and safe working environment for our
employees working on site, in the office or from home. When
we build and maintain our infrastructure, protecting people
on the ground is a top priority. TDC NET’s ‘vision zero’ aim is
built on the strong belief that every injury can be prevented.
As a lever in changing our health and safety (H&S) culture, we
prioritise near-miss registration to provide valuable learnings on
practical prevention.
Achieving our ambition and targets requires the right H&S
culture across TDC NET. As expressed in TDC NET’s Health
and Safety Policy, we focus on providing a healthy and safe
working environment for our employees, which is enabled
by our H&S governance structure. Our Board-level H&S
Committee reviews performance data and risks, and approves
key initiatives. In support of TDC NET’s Executive Leadership
Team, our Biparty H&S Committee, comprising employees,
Governance
ESG statements
Financial statements
Annual Report 2023
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Ambition:
To become one of the safest
places to work by 2025
Targets:
•
Reduce lost time injury frequency
rate by 50% in 2025 compared with
2019
•
Build a proactive health and
safety culture, striving to maximise
learnings from incidents and near
misses to prevent injuries at work.
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
trade unions and management representatives, works to align
H&S initiatives across business areas. Execution of initiatives
is anchored in our H&S organisation and the related 42 H&S
groups. Our H&S organisation, covering 93 representatives,
undergoes annual training, while all new employees receive
H&S training.
Our H&S training performance score KPI of minimum 95%
trained (Implemented training/Need of training), reached an
average of 94%.
Our H&S organisation is structured in line with the Danish
Working Environment Act, and our H&S management system
is ISO 45001 certified, covering 100% of TDC NET’s operations
where employees work. Technical installations are excluded.
The latest recertification was obtained in 2022, and internal
and external H&S audits, including risk assessments, are
conducted every year to ensure continued compliance with the
standard.
2023 results and performance
In 2023, we recorded no fatalities. Our colleagues reported a
total of 2,087 near misses (2023 target: 1,200) and thereby our
rate of near-miss accidents increased from 194 in 2022 to 454
in 2023. We see this increase as a positive development and a
clear result of our safety awareness initiatives across TDC NET.
We encourage our employees to report near misses as part of
our prevention measures.
Lost time injuries (LTIs) dropped from 29 in 2022 to 24 in 2023.
Our LTI frequency rate (LTIFR) declined from 6.1 in 2022 to 5.2
in 2023, thereby not reaching our target of 4.2 for 2023. In line
with our ambition of being one of the safest places to work,
our LTIFR target for 2025 is 3.1.
At TDC NET, we use the Bradley scale
1
to indicate the maturity
level of our H&S culture. In 2023, we achieved 81/100 on the
Bradley scale as in 2021 and 2022. Though TDC NET uses the
widely accepted Bradley approach to define safety culture,
the Bradley Survey is developed by TDC NET inspired by
international research in health and safety. A score of 81/100
is high and satisfying. However, obtaining the same score year
after year reveals TDC NET's challenges in improving our health
and safety culture.
1 The Bradley Scale: TDC NET’s Bradley Survey is a 7-topic / 28-question survey, inspired by validated sources from international H&S Research, e.g. Vision Zero, the Danish
National H&S Research Center and Nordic Safety Climate Questionnaire.
Lost time injury frequency rate (LTIFR) Injuries with lost time
39
Days of absence
410
437
6.2
7.6
8.0
6.1
5.2
3.1
31
29
25
24
14
289
189
274
2019 2020 2021 2022 2023 2025
2019 2020 2021 2022 2023 2025
2019
2020
2021 2022 2023
Performance Target
Performance Target
Performance
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•
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
SDG 8 in action
Strengthening contractors’ prevention
capacity through audits
Our H&S efforts support the
following target:
•
8.8 Protect labour rights and promote safe and secure
working environments for all workers
•
2023 action: TDC NET focuses not only on internal
H&S. When working with our contractors, we
put H&S in focus both in civil works and facility
management. In 2023, 100% of major and minor
contractors signed specific contracts on H&S
demands from TDC NET, including audits and
reporting. In 2023, TDC NET audited 55% of its
contractors
Outlook
In 2024, we will continue our strong focus on reducing injuries.
We will change our focus from lost time injuries to total
recorded injuries. Several parallel initiatives are planned,
including:
increasing the level of near misses recorded,
establishing clear governance for High Potential events,
analysing and managing Key Critical Risks,
sharing knowledge of preventive actions between TDC NET
and subcontractors and establishing specific KPIs for
reducing contractors’ injuries and
auditing contractors on site.
TDC NET depends on contractors to perform work
throughout its business, for example from digging and
laying our fibre network to maintaining buildings and
technical installations. Contractors’ health and safety
remains a high priority. In 2023, zero fatalities were
recorded among contractors.
TDC NET’s Board-level H&S Committee has set an
annual target to audit at least 50% of contractors
within H&S. In 2023, 66 contractors were in scope for
the target. 55% of these were audited. Contractors
are selected for audits based on H&S data, spend and
number of hours worked.
55%
of TDC NET contractors were
audited in 2023.
Audits are two-fold and consist of 1) a review of the
contractor’s H&S structure and how it manages health
and safety based on the Danish Working Environment
Act and 2) an inspection of a specific work situation
based on working environment guidance, for example
within protection equipment, ergonomics, chemicals
or psychosocial working environment. We also look
at requirements set for sub-contractors’ health and
safety and thereby apply the principle of value chain
responsibility. Based on corrective actions identified,
we enter into dialogue with contractors on how to
improve and conduct follow-up audits. We monitor
contractors’ safety data and ask for monthly reports
on accidents, near misses and hours worked, which we
share with the Board-level H&S Committee.
To strengthen our contractors’ focus on prevention,
we proactively share benchmark reports to inspire
progress. We also facilitate quarterly best practice
sharing sessions for all contractors on topics such as
risk assessments and safety awareness.
Our focus for 2024 will be to audit contractors that
have not yet been audited and include contractors’
injuries in a shared target with TDC NET.
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•
•
•
•
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Diversity and inclusion
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Women in leadership
Inclusion score
86
85
Above 80
23%
2020 2021 2022 2023
Performance
2025
Target
2030
Aspiration
2022
2023
SDG 5 in action
Our D&I efforts support
the following target:
•
5.5 Ensure women’s full and effective participation
and equal opportunities for leadership at all levels of
decision making
•
2023 action: We facilitated a mentorship
programme together with Women in Tech to
provide female talents with access to a mentor
Performance
2025
Target
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
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Ambition:
Protect network integrity,
personal data and the right
to privacy
Targets:
•
All employees complete a GDPR
e-learning course
•
Evaluate data requests in
governance forum
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
"Black belt" in cyber defence
In 2023, TDC NET was the first
telecommunications company in Denmark to
achieve the Trusted Introducer certification
1
–
the so-called black belt in cyber defence. The
risk of cyber attacks is growing in Denmark,
and companies that provide critical digital
infrastructure bear a special responsibility
to keep cybercriminals at bay. As Denmark’s
largest provider of mobile and fibre networks,
we have invested in a defence setup that aligns
with high international standards.
Specifically, TDC NET’s special ‘Cyber
Defence Center’ received certification from
Trusted Introducer in the category ‘Incident
Response’, where the team’s maturity on 45
different parameters was measured within four
categories: organisation, employees, tools and
processes.
The entire certification process has been a
fruitful learning curve, providing new workflows
and faster processes that benefit our customers.
“We are incredibly proud to receive the
certification from Trusted Introducer, which is
considered by many to be the leading standard
in the field, and which leading organisations
such as the Center for Cyber Security and
DKCERT also orient themselves towards. After
months of relentless efforts, we have the
proof that we are well prepared for the ever-
increasing cyber threats.”
– Karsten Brinkmann, Head of Security,
TDC NET
1
Trusted Introducer is an association for CSIRTs (Computer
Security Incident Response Teams) established by European
CERT in 2000 with the aim of providing a safe framework for
the exchange of cyber security knowledge between CSIRTs.
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SDG 12 and 16
in action
•
Promote responsible consumption and justice in
societies
•
2023 action: We kept a strong focus on promoting
the right to privacy while protecting critical and
digital infrastructure
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Addressing
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Supplier engagement
supply chain
impacts
Our approach to supplier engagement
At TDC NET, we depend on our supply chain when building and
operating digital infrastructure. While connecting Denmark,
we recognise that our environmental, social and economic
impacts reach far beyond our organisational boundaries,
and we therefore take responsibility for addressing these
throughout our supply chain. Our Sustainable Procurement
programme ensures that our expectations concerning suppliers’
sustainability efforts are consistently communicated to
suppliers – from the first interaction through to the sourcing
process and during the contract lifecycle.
We apply a risk-based approach to category and vendor
management, addressing risks according to their likelihood and
impact. With the purpose of co-creating an efficient, resilient
and sustainable supply chain, we want to foster business
relationships with suppliers, based on honesty, aligned values
and the desire to collectively address ethical, environmental
and social impacts, as well as minimise security and privacy-
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related risks.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Supplier governance
Within the areas of human and labour rights, environment,
ethics, security and data protection, TDC NET’s Supplier
Code of Conduct sets the foundation for how we engage
our suppliers. The Code details the steps we expect suppliers
to take with us to develop their sustainability programmes.
It includes a focus on monitoring and evaluating, corrective
action plans as well as an enforcement mechanism for supplier
non-compliance, and goes beyond a statement of minimum
requirements. Our due diligence process screens all purchases
for social and environmental risks as well as impact on Scope
3, requiring all medium and high-sustainability risk purchases
above our spend threshold to contractually undergo an
EcoVadis assessment and/or on-site audit that covers the
environment, social practices and business ethics.
At board level, the responsibility for supply chain management
rests with the entire Board of Directors. Supply risks are
identified and reviewed as part of TDC NET’s Enterprise Risk
Management processes, whereby large risks are reported
to the Audit Committee and Board of Directors. On the
operational side, our company-level Sustainable Procurement
Board meets quarterly to oversee roadmaps, initiatives and
performance metrics to deliver on our ambition and targets as
well as our risk-response mitigation actions.
Shared audit programme
We audit suppliers to ensure compliance with our Supplier
Code of Conduct. TDC NET is an active member of the Joint
Alliance for CSR (JAC) – an association of telecommunications
operators that collaborates to verify, assess and develop
suppliers’ sustainability practices. As the telecoms industry
is characterised by a supply base with a high level of
commonality between operators, it makes sense to
share resources among members to implement long-term
environmental and social responsibility among the different
layers or tiers of the information and communication
technology (ICT) supply chain globally.
In 2023, JAC members carried out audits and worker surveys
at 150 locations in 22 countries. This covered more than
10,000 workers, resulting in over 890 corrective actions raised.
Using common audit checklists and approved third-party
auditors, JAC members audit suppliers on health and safety,
environment, labour and human rights, and business ethics,
and afterwards share audit results between them. Each JAC
member commits to auditing five suppliers annually.
2023 results and performance
In 2023, TDC NET audited six suppliers. We use the EcoVadis
platform to evaluate suppliers’ sustainability performance.
In 2023, 86 medium and high-risk suppliers were eligible for
EcoVadis, of which 52 reported to EcoVadis.
By the end of 2024, we want to increase our spend coverage of
eligible medium and high-risk suppliers reporting to EcoVadis to
100%. In 2023, the risk covered was 71%. The weighted average
score of suppliers reporting to EcoVadis was 65%, compared
with 68% in 2022.
In 2023, we piloted our Supplier Development and Capacity
Building programme. While tendering for a strategic purchase,
Ambition:
To have full transparency regarding the
environmental, health and safety, business
ethics, and human and labour rights in our supply chain
by 2030. We intend to achieve this by having:
•
All new contracts include the latest Supplier Code of
Conduct
•
All eligible suppliers with medium or high
sustainability risk reporting to EcoVadis
•
All suppliers and sub-suppliers with medium or high
sustainability risk having at least one on-site audit
•
All CO
2
-intensive purchases undergoing due diligence
processes, with suppliers chosen on the basis of CO
2
alongside commercial and technical criteria
•
All procurement staff trained and able to deliver on
the sustainability agenda
Targets:
•
5 on-site audits per year
•
Increase spend coverage of eligible suppliers with
medium or high sustainability risk reporting to
EcoVadis to 100% by the end of 2024
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
we awarded business to a supplier that was
beginning its sustainability journey. We
agreed on contractual terms that clearly
laid out how we expect the company to
develop over time, then provided one-on-one
consulting and conducted a JAC audit. We
were then able to ensure it had the right
policies, processes and performance metrics
to support our sustainability ambitions.
In November 2023, we signed a partnership
agreement with Ericsson, choosing Ericsson’s
5G mobile technology to help reach our
net-zero target for the entire value chain.
Ericsson will provide us with energy-efficient
solutions, including artificial intelligence and
machine learning software, which will help
reduce the energy consumption of our mobile
network. Together with Ericsson, we also
commit to actively reducing the embodied
carbon footprints in radio equipment by
using Ericsson’s latest portfolio, featuring
reduced weight, a more compact design, and
enhanced efficiency per unit when compared
with previous generations.
Training our colleagues
Training our procurement professionals is
vital for providing knowledge and tools that
help solidify our sustainable procurement
programme and supplier engagement efforts.
Our category managers and strategic sourcing
team members are the point of contact for
external suppliers. In 2023, we formalised
and fully complied with our sustainable
procurement training with a standard
operating procedure, training 100% of our
procurement professionals in areas such as
integrating sustainability into the sourcing
process, how to manage supplier assessments
and how to engage suppliers in Scope 3.
Outlook
In 2024, we intend to update our Strategic
Sourcing Guidelines for Sustainability, follow
our sustainable procurement training plan,
revisit the category risk assessment that
defines environmental and socio-economic
risks and launch an updated screening tool for
strategic sourcing. We also plan to replicate
the successes of the Supplier Development
and Capacity Building pilot and create a Net
Zero Transition Pathway for Scope 3 based on
our Supplier Engagement Roadmap.
We plan to strengthen our risk assessments
of suppliers during 2024. In that connection,
we will specifically focus on preparing for
new ESG regulations, such as CSRD and NIS2,
which both relate directly to our supply chain.
Sustainability and strategic sourcing
After a successful pilot programme that included sustainability criteria at all
steps of our strategic sourcing process at the end of 2022, we rolled out our
Strategic Sourcing programme in full in 2023.
All procurement projects were screened for sustainability risk and impact.
Purchases eligible for supplier assessment (EcoVadis or an on-site sustainability
audit (though JAC)) were clearly communicated in the Request for Proposal and
then formalised using specific contractual clauses. High CO
2
purchases included
15 questions in the Request for Proposal. Bidders were evaluated alongside cost
and technical criteria on the maturity of their climate programmes, their climate
data and expected impact on our CO
2
inventory. Contractual clauses were
introduced for the first time to bind suppliers to improve over time.
By doing our due diligence in the sourcing process, we reward suppliers who
support our decarbonisation ambitions, while onboarding those beginning their
decarbonisation journey. To accelerate efforts, we build partnerships with
suppliers through the Supplier Development and Capacity Building programme.
“To achieve our net-zero target by 2030, we require a substantial
amount of support from our supplier base. By having a proactive
climate agenda that is integrated into the procurement and
supplier engagement process, we ensure that bidders and suppliers
understand their role and how they can contribute. We actively
seek out suppliers who share our vision, and who provide innovative
ways to address the climate crisis.”
– Mads Sonne Mortensen, Head of Supply Chain, TDC NET
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Memberships, partners and alliances
Since 2009, TDC NET has
been a participant to
the UN Global Compact
and committed to the
corporate responsibility
initiative and its
principles in the areas
of human rights, labour,
environment, and anti-
corruption.
2023 ratings
and rankings
Descriptions
and benchmark
Score
Awaiting our 2023 EcoVadis score based on
the submitted 2023 assessment.
-
TDC NET maintained its GRESB score
level achieved in 2022.
95 out of 100
CDP score
TDC NET
maintained its B score
achieved in 2022.
CDP supplier engagement score
TDC NET
's supplier engagement score
increased from a B score in 2022 to an A-
in 2023, reaching the leadership band.
B
A-
TDC NET achieved a low risk rating from
Sustainalytics.
18.6 (Low)
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Memberships and ratings
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Enterprise risk management
As a critical infrastructure provider, we navigate a landscape with many risks. From
macroeconomic uncertainties associated with building the digital network in Denmark to the
challenges posed by our technological transformation journey, our exposure is diverse. Risks are
an inherent part of our business activities, and we aim to continuously mitigate them to an
acceptable level as the risk exposures evolve.
The purpose of risk management
Embedded in our risk management framework is a clear
chain of command, ensuring the integration of risk and
opportunity management in our business activities. We
follow a process that involves identifying and assessing risks,
formulating response plans, implementing those plans, and
reassessing outcomes. Our risk management process extends to
maintaining a portfolio of risks that fosters an information flow
to ensure that key risk insights reach decision makers.
Our risk management process
The risk management framework deployed at TDC NET
enables a consistent approach for identifying, assessing,
documenting and responding to risks. Risks are assessed
based on their potential financial impact and probability
of occurring and are captured in risk registers across the
organisation. We also prioritise GDPR compliance by utilising
separate consolidation frameworks for risks affecting registers,
specifically addressing data protection and privacy concerns.
Each business line has its own risk coordinator responsible for
its risk register and a Data Protection Manager responsible for
GDPR compliance.
In collaboration with risk owners, the risk coordinators
ensure that risks are assessed, and mitigation strategies are
established. A member of the Executive Leadership Team
is accountable for each risk register, and biannually, all risk
registers are consolidated centrally and reviewed by the
Executive Leadership Team to secure alignment on key risks
and ensure execution of mitigating plans. The overall risk
exposure and status of the mitigating activities are submitted
and reviewed by the Audit Committee and Board of Directors
biannually. In the following pages, each risk will be analysed
and met with strategic mitigating actions.
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Top 8 business risks:
#1 Commercial trends and competition
#2 Funding and capital market risk
#3 Cyber and information security
#4 IT landscape
#5 Supply chain conduct
#6 Legal compliance and data privacy
#7 Recruiting a skilled workforce
#8 Climate change adaptation
Read more on the following pages
→
Environment
Social
Governance
Not ESG
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Risk #1
Commercial trends and competition
Risk #2
Funding and capital markets risk
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Description
Over the years, we have created a strong commercial position within our broadband
and mobile infrastructure market. We own and operate a broad range of different
technologies. As the industry is facing increasing consumer demand for faster connectivity,
we embrace the deployment of high-speed infrastructure in our platforms. Simultaneously,
we foresee a decrease in relevance over time for legacy technologies and products, as
more and more consumers can connect to the new infrastructure offerings.
Potential impact
If we become unsuccessful in anticipating and aligning with market demands, we may
encounter added operating costs linked to the continued use of legacy technologies.
Conversely, decommissioning our legacy platforms at a pace exceeding market demand
could potentially result in the loss of customers and missed business opportunities.
Mitigating actions
We actively track market trends and the shift from legacy to future-proof technologies,
which enables us to anticipate and respond to technological developments. This positions
us to align our portfolio with prevailing market dynamics. Hence, we prioritise the
decommissioning of legacy platforms, ensuring our customers are seamlessly connected to
resilient new infrastructure. Simultaneously, we concentrate on enhancing the customer
experience in our fibre roll-out, adopting a "first time right" approach. Our commitment
to delivering fast fixed connections and maintaining Denmark’s premier mobile network
remains central to our overall strategy.
Not ESG
Description
As part of the transformation, we have an extensive investment programme. Our capital
expenditure is funded with the strong resilient cash flow from operations. We are
leveraged with debt consisting of loans, bonds and credit facilities and are dependent on
access to capital markets for funding and liquidity management, including derivatives for
hedging of interest-rate and foreign currency exposure.
Potential impact
Fluctuating interest rates may adversely impact future interest costs, and fluctuations in
foreign currency prices may impact on procurement costs, debt levels or interest costs.
Mitigation action
We apply treasury management to ensure stable financial risks. We regularly monitor
our financial exposures and follow an active hedging strategy whereby interest rates
are hedged for an average of 5 years, and foreign currency risks are hedged to DKK or
EUR with very limited room for other exposures. Intra quarter cash flow movements
are mitigated through cash and revolving credit facilities. Moreover, we plan our
liquidity, refinancing, leverage and cash flows with caution to ensure a sustainable
financial position. On an ongoing basis, we optimise debt issuances depending on
developments in the capital markets and the funding needs of TDC NET.
Not ESG
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Risk #3
Cyber and information security
Risk #4
IT landscape
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Description
We greatly rely on information systems and technologies to facilitate our daily operations.
As a major provider of digital infrastructure, we are aware of the risks associated with
cyber attacks. These risks could extend beyond our organisation, potentially leading to
unauthorised access to critical infrastructure.
Potential impact
A cyber security breach could pose a concern for our integrity, with the possibility of
sensitive data being at risk, potential service disruptions, financial impacts, and damage to
our reputation. Furthermore, a cyber security incident might have the potential to escalate
beyond our organisation.
Mitigating actions
To enhance our resilience against cyber threats, we have implemented key strategic
measures to strengthen risk management and reinforce disaster recovery and business
continuity planning. This broad approach enhances our agility and operational integrity in
facing digital threats and minimalises potential operational disruption. Our Cyber Defense
Center has earned a top industry certification in incident response, marking us as a leader
in cyber security in Denmark. This achievement highlights our capability in managing cyber
incidents. Adhering to NIST and ISO frameworks, we systematically manage and prioritise
cyber security, ensuring our preparedness against emerging threats. Our comprehensive
approach ensures that we remain a steadfast and trustworthy partner to our customers,
protecting their interests and our own with immense dedication and expertise.
Governance
Description
Our current IT landscape includes several legacy applications that may raise concerns
about system efficiency and security. Additionally, we are in the process of separating our
remaining shared systems with Nuuday. Our ongoing transformation of IT, while aimed at
addressing these issues, involves complexities that require meticulous management.
Potential impact
Operating legacy IT applications could potentially entail risks such as security vulnerabilities
and operational challenges. This dependence often involves relying on specific personnel and
incurring ongoing expenses to support and manage ageing systems. Sharing systems with
Nuuday can introduce some additional considerations, and if our transformation efforts
overlap, unexpected costs may arise. The shared systems could potentially raise security
concerns and reliance on Nuuday for vulnerability management.
Mitigating actions
Our transformation of IT is designed to handle the challenges our organisation faces to
enhance our operational efficiency and strategically position us for the future. One aspect
involves our plans to decommision legacy applications and introduce new solutions. This
transition is expected to yield efficiency gains, improve workflow and increase productivity.
We maintain a strict adherence to the highest standards in both cybersecurity and general
IT practices. We have a proactive collaboration with Nuuday, as we continuously monitor
and address potential threats, ensuring that our IT ecosystem remains robust and secure. Our
proactive approach is integral to maintaining uninterrupted operations and protecting our
organisation from any unforeseen challenges.
Governance
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Risk #5
Supply chain conduct
Risk #6
Legal compliance and data privacy
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Description
We rely on an international network of suppliers that operate in diverse legislative
jurisdictions and with varying degrees of maturity across various practices, including
sustainability and compliance. Sustainability practices encompass considerations
related to environment, health and safety, labour, and human rights and anti-corruption
measures. We face risks related to labour-intensive services resulting from general cost and
wage inflation locally and internationally.
Potential impact
The risk of suppliers being non-compliant with environmental and social legislation poses
an ongoing threat to our operations, integrity and reputation. Such instances may give rise
to legal disputes and require supply chain changes. The risk of price increases on labour-
intensive services could add pressure to our financial and business activities.
Mitigating actions
Our process for supplier selection employs a risk-based and vendor management
approach. Based on their sustainability practices, it identifies suppliers for focused
scrutiny. Sustainability assessments are conducted for medium and high-risk suppliers,
with selected high-risk suppliers undergoing additional audits through Joint Alliance for
CSR. Ongoing category and supplier performance management, competitive sourcing
processes and standardised contracts with our suppliers are instrumental tools in
responding to increasing price pressure and securing a stable cost base.
Environment
Social
Governance
Description
Our strong market position in specific areas subjects us to sector-specific regulations,
including emergency communications, security measures, sanctions aligned with EU, US
and Danish legislation, and compliance with data privacy rules, notably GDPR.
Potential impact
Non-compliance may result in fines and adverse decisions from the Danish Business
Authority, as well as the Danish Competition and Consumer Authority. Legal requirements
for investors, customers and suppliers could be affected by Danish authorities. The Danish
Centre for Cybersecurity could impose restrictions on agreements and arrangements in
relation to our infrastructure. Furthermore, any GDPR compliance shortfalls could lead to
potential legal disputes and reputational damage.
Mitigating actions
We are implementing a comprehensive compliance programme that involves training
employees to conduct regulatory checks to ensure a proactive approach. Vigilantly
monitoring legal and political developments in the market allows us to adapt swiftly. We
conduct desktop studies on contractual relations in alignment with sanction regulations.
Further, we have implemented security and data protection measures aligned with GDPR
and Danish security regulations regarding security breaches and threats to personal data.
Governance
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Risk #7
Recruiting a skilled workforce
Risk #8
Climate change adaptation
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Description
Recruiting resources with a background in IT, artificial intelligence, data and
transformation with hands-on experience is particularly challenging. This is due to the
rapidly evolving technological landscape, and overall high demand for specialised skill sets
globally. Additionally, female resources in IT with the right capabilities are scarce in the
industry, which makes recruitment of a diverse workforce challenging.
Potential impact
Recruiting challenges for IT and transformation backgrounds may result in a skills gap,
hindering our transformation initiatives. The difficulty in recruiting international and
female resources in IT hampers gender diversity, potentially limiting the organisation’s
ability to tap into a diverse talent pool.
Mitigating actions
We are adjusting our strategic recruitment approach and strengthening our value
proposition in the market to attract national and international resources with IT and
artificial intelligence backgrounds, and investing in ongoing training programmes to bridge
skill gaps and ensure the workforce remains adaptable to evolving technologies. We prioritise
succession planning by identifying key roles, and cross-train existing specialists to bridge
technological gaps. In addition, we actively promote diversity and inclusion initiatives
internally and externally to address the challenges of diversity. This involves fostering an
inclusive workplace culture and establishing outreach programmes through partnerships to
attract a more diverse talent pool.
Social
Description
Climate change and weather-related disasters pose a potential threat to our
infrastructure, specifically heavy downpours causing flooding or landslides on our mobile
equipment and crucial infrastructure at our sites, which are essential for maintaining
uninterrupted telecommunication services.
Potential impact
The impacts of climate-induced events, such as flooding, can be severe. Direct exposure to
water poses a threat to mobile equipment, power switchboards and batteries across our
sites. Such damage can disrupt our operational capabilities and result in service outages.
Furthermore, the financial implications of repairing or replacing equipment, coupled with
potential service disruptions, could result in revenue losses and reputational damage.
Mitigating actions
Establishing three physical locations for our mobile network operation ensures full
redundancy. In the event of a site being flooded, seamless continuity is assured through
fail-over datacentres safeguarding against service disruptions. Furthermore, multiple
climate protection activities at exposed sites are carried out, with more to come in the
short-term future.
Environment
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Responding to
climate risks
We apply the recommendations from the Task Force on
Climate Related Financial Disclosures (TCFD) to understand,
identify and report on climate-related risks and opportunities.
We identify short, mid- and long-term climate risks, and we
report on them in our annual response to the Carbon Disclosure
Project (CDP). As recommended by the TCFD, we describe our 1)
governance, 2) strategy, 3) risk management and 4) metrics and
targets in relation to climate risks.
Governance
Climate-related risks are identified via TDC NET’s Enterprise
Risk Management (ERM) process. Risk assessments cover all
areas of our value chain – upstream, downstream and in our
direct operations. Our ERM process is conducted every half
year. Risks are assessed based on a two-dimensional heatmap
rating system that estimates the impact of a risk on financials
or reputation, and the likelihood of the risk materialising.
The most significant risks are reviewed and assessed by our
Executive Leadership Team, Audit Committee and Board of
Directors.
Strategy
Our strategic direction for sustainability is presented on pages
19-20 of this report. Supporting our corporate strategy, five
priority areas have been identified through our materiality
assessment:
•
Climate action
•
Health and safety
•
Diversity and inclusion
•
Digital trust
•
Governance, compliance and conduct
See pages 28-47 of this report for more information on targets
and achievements related to the priority areas.
Risk management
TDC NET identifies and monitors both physical and transition-
related climate risks. In our annual CDP response, we describe
the identified risks and the planned mitigation actions in detail.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Specific risks include acute and long-term risks related to
climate change (for example, extreme weather events such
as heavy downpours causing flooding and landslides) that
can impact on our facilities and equipment, but also the
introduction of carbon tax. Based on the risk score, some of the
identified risks have been brought to the attention of the Audit
Committee.
Metrics and targets
Our 2030 net-zero target for the entire value chain is validated
by the Science Based Targets initiative.
Page 28 of this report gives an overview of performance against
targets for our priority areas, including climate and nature. We
also disclose our progress in our annual response to the CDP.
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Key risks and
mitigation actions
See page 57 for risk #8 on climate
change adaptation for a description of
key climate related risk impacting on
TDC NET’s business. Climate change
will lead to an increase in extreme
weather events, such as heavy
downpours and flooding, which could
damage our facilities, equipment and
infrastructure.
Specific mitigation measures at our
most critical facilities include water
sensors and water alarms in our
facilities, emergency power supply,
frequent examination of the pump and
drainage system, and advanced pump,
well and drainage systems for efficient
water removal. We have increased
the frequency of maintenance and
have prepared emergency contingency
plans, terrain changes etc. to mitigate
the impact of these risks materialising.
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Annual Report 2023
Our governance model
Shareholders and general meeting
Board of Directors
Nomination &
Compensation
Committee
Health & Safety
Committee
Audit
Committee
Executive Committee
Executive Leadership Team
ESG Governance Forums
Climate
Forum
Biparty Health
& Safety
Committee
Diveristy &
Inclusion Forum
Security
Council
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Meeting attendance:
Audit
Board member Board of Directors Committee
Henrik Clausen
Frank Hyldmar
Natalia Akst
Susanne Juhl
Martin Præstegaard
Geoffrey Shakespeare
Gabriela Styf Sjöman
Ole Mølgaard Andersen
Svend Bank Andreasen
Pernille Bloch
Kurt Nielsen
Nomination &
Compensation
Committee
Health
& Safety
Committee
Total 9 5 7 4
Attended Not attended Not a Board/Chairship member at the time
Numbers above indicate number of meetings attended out of the total possible numbers of meetings.
*TDC NET Sustainability Policy, approved by the Board of Directors, is available here link →
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Board committees
The Board of Directors has appointed an Audit Committee (AC), a Compensation & Nomination Committee (CNC), and a Health & Safety Committee (H&SC) to supervise
certain fields and prepare cases to be decided on subsequently by the Board of Directors. Read about the mandate of each committee here link →
Audit Committee
Compensation & Nomination Committee
Health & Safety Committee
Members
· Susanne Juhl (Chair)
· Frank Hyldmar (Chair)
· Frank Hyldmar (Chair)
· Henrik Clausen
· Henrik Clausen
· Henrik Clausen
· Natalia Akst
· Natalia Akst
· Natalia Akst
Purpose
The AC assists the Board of Directors in monitoring the financial
The CNC assists the Board of Directors in matters relating to the
The H&SC assists the Board of Directors in supervising and
and sustainability reporting as well as risk management of the
nomination and remuneration of the Board of Directors and the
setting the strategy for our work with strengthening the health
company’s key financial and business risks. The mandate of the
Executive Committee, and supervision of the remuneration of the
and safety of our employees and contractors’ employees. The
AC is set out in the Committee Charter.
management at all levels. The mandate of the CNC is set out in
mandate of the H&SC is set out in the Committee Charter.
the Committee Charter.
Focus areas in 2023
Cyber security
Incentives
Reporting
The AC continuously monitors our management of cyber security
The CNC has set out a new long-term incentive plan for our key
Our data on health and safety is continuously being improved
risks and in 2023, the AC focused on the implementation of the
managers to support our transformation for 2024-2026.
through the H&SC’s scrutiny of our reporting.
new requirements from NIS2.
Diversity and Inclusion
Contractors’ health and safety
Sustainability reporting
We want our employees to reflect the diversity of the people
We want to ensure that the people who work for us have a safe
The AC has supervised our readiness for sustainability reporting
connected by our infrastructure, and we work to employ and
and healthy working environment, and the H&SC therefore also
in accordance with the CSRD. The AC has adopted a new
integrate underrepresented groups in society. The CNC assisted
focuses on the health and safety of our contractors.
Committee Charter to reflect the new scope of supervisoury
the board with developing our new diversity and inclusion
duties of the AC under CSRD.
policy in December 2022, and in 2023, the CNC worked with the
Executive Leadership Team on initiatives to create a more diverse
Financial strategy
employee population in relation to nationality, age, and gender.
The AC focuses continuously on monitoring management of our
financial strategy, especially our debt management.
Nomination of new executive leaders
To execute our ambition to be Denmark’s undisputed market
leader by 2030, the CEO has recruited new skilled people for our
Executive Leadership Team in close dialogue with the CNC.
Oversees sustainability
· Digital trust
· Diversity and inclusion
· Health and safety
priorities
· Governance, compliance and conduct
Adopted policies
· Tax Principles
· Diversity and Inclusion Policy
· Information Security Policy
· Remuneration Policy
· Statement on the competence required by the Board of
Directors
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GmbH and at the same time was appointed Chairman.
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Board of Directors
Henrik Clausen
Chair since 2020
1963, male, Danish
•
Elected by the shareholders
•
Not independent
1
•
Joined in 2020
•
Re-elected in 2023
•
Term to expire in 2024
Education
MSc in Civil Engineering, Technical University of Denmark.
MSc in Business. Administration, INSEAD, France.
Other managerial duties
Member of the Board of Directors of the Technical University
of Denmark. Member of the Board of Directors of Dansk
Erhverv.
Frank Hyldmar
Deputy Chair since 2021
1961, male, Danish
•
Elected by the shareholders
•
Not independent
2
•
Joined in 2021
•
Re-elected in 2023
•
Term to expire in 2024
Education
MSc in Economics, Copenhagen Business School, Denmark.
Other managerial duties
Chairman of the Board, Currenta GmbH, CEO of Currenta
GmbH
3
. Member of the Board of Directors of YIT Oyj.
Gabriela Styf Sjöman
1969, female, Swedish
•
Elected by the shareholders
•
Independent
•
Joined in 2021
•
Re-elected in 2023
•
Term to expire in 2024
Education
MSc in Business Administration, University of Durham, United
Kingdom.
Other managerial duties
Member of the Board of Directors of Global Legal Entity
Identifier Foundation (GLEIF). Managing Director Research and
Network Strategy, BT Group, United Kingdom.
1
As the member stepped down as CEO of TDC Holding A/S on
8 December 2021.
2
As of 1 January 2024, the board member has a business relationship with an
ultimate shareholder.
3
As of 1 January 2024, Frank Hyldmar has stepped down as CEO of Currenta
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Board of Directors
Geoffrey Shakespeare
1961, male, Irish
•
Elected by the shareholders
•
Independent
•
Joined in 2021
•
Re-elected in 2023
•
Term to expire in 2024
Education
BSc Engineering, Fellow of the Institute of Engineers, Ireland.
Other managerial duties
Managing Director of Shakespeare Advisory Ltd and
Shakespeare Telecommunication Ltd.
Susanne Juhl
1971, female, Danish
•
Elected by the shareholders
•
Independent
•
Joined in 2023
•
Term to expire in 2024
Education
MSc, Political Science, Aarhus University, Denmark. Master’s
degree in Public Administration and Public Policy from London
School of Economics and Political Science, UK. Executive MBA,
Imperial College Business School, London, UK.
Other managerial duties
Chair of the Board of Directors of HOFOR A/S, BIOFOS A/S.
Deputy Chair of the Board of Directors, M. J Eriksson A/S,
Member of the Board of Directors in Evida A/S, Technical
University of Denmark, A/S Politiken Holding and Politiken Fonden.
Natalia Akst
1988, female, German
•
Elected by the shareholders
•
Not independent
•
Joined in 2022
•
Re-elected in 2023
•
Term to expire in 2024
Education
BSc, Economics, University of London, London, UK. MSc,
Financial Economics, University of Oxford, Oxford, UK.
Other managerial duties
Managing Director at Macquarie Asset Management, Member
of the Board of Directors in Virtus Data Centres LTD.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Board of Directors
Ole Mølgaard Andersen
1965, male, Danish
•
Elected by the employees
•
Not independent
•
Joined in 2021
•
Term to expire in 2024
Service Technician at TDC NET.
Education
Blacksmith, Aalborg Technical School, Denmark.
Other managerial duties
Deputy Chairman and Secretary of Dansk Metal Tele Vest.
Svend Bank Andreasen
1959, male, Danish
•
Elected by the employees
•
Not independent
•
Joined in 2021
•
Term to expire in 2024
Senior Project Manager at TDC NET.
Education
MSc in Fibre Optics and Electromagnetics, Technical University
of Denmark, Denmark.
Other managerial duties
Deputy Chairman of the Board in LTD.
Pernille Bloch
1966, female, Danish
•
Elected by the employees
•
Not independent
•
Joined in 2023
•
Term to expire in 2024
Shift Supervisor at TDC NET.
Education
Diploma in commerce (in Danish: merkonom).
Other managerial duties
Deputy Chairman of the Board of LTD .
1
Pernille Bloch replaced Kurt Nielsen on the Board of Directors per 27 March 2023.
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2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Management level Status 2023 Target Year for reaching target
Board of Directors
Total number of shareholder elected
board members: 6
3 men / 3 women
40/60 composition No target year as gender distribution is
balanced
First level of management
(Executive Leadership Team
(ELT))
Second level of management
(Senior Leadership Team (SLT))
Total ELT: 13
11 men / 2 women
85% men / 15 % women
Total SLT: 39
27 men / 12 women
69% men / 31% women
30/70 composition 2025
Board of Directors First level of management (2023)
(Executive Leadership Team (ELT))
Second level of management (2023)
(Senior Leadership Team (SLT))
2021
Women
2022
Men
2023
Women
Men
Women
Men
85%
69%
15%
31%
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Executive Leadership Team
The 10 members of the Executive
Leadership Team ensure
alignment between company
goals and mission.
Michel Jumeau (Chief Executive Officer)
and Henrik Brandt (Chief Financial Officer)
constitute the Executive Committee in
TDC NET.
The Executive Committee is supported by
the Executive Leadership Team, which is
responsible for the day-to-day management
of the company and the progress of
reaching our strategic targets. Through a
cohesive decision process, the Executive
Leadership Team drives initiatives, promotes
cross-functional teamwork, engages with
stakeholders, and establishes partnerships for
the broader goal of connecitivy to achieve our
mission of connecting Denmark. For Everyone.
Standing from left to right:
Torben Svejgaard
Head of Delivery & Field
Service
Robert Dogonowski
CCO, Head of Commercial &
Partners
Christian Fröhlich
Head of Legal & Regulatory
Selina Lomholdt
Chief Human Resources
Officer
Jakob Dirksen
Chief Technology Officer
Seated from left to right:
Angelos Cacouros
Head of Strategy,
Transformation & Sustainability
Henrik Brandt
Chief Financial Officer
Campbell Fraser
Chief Information Officer
Michel Jumeau
Chief Executive Officer
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Executive Comittee
Michel Jumeau
Chief Executive Officer
•
Born in 1972
•
Appointed in 2022
Education
MSc in Engineering, Télécom
Paristech, France.
Career
TDC NET A/S
2022 –
EVP, Chief Executive Officer
Orange A/S
2005 - 2022
EVP, Deputy CEO, Consumer Business (2018-2022)
SVP, Marketing & Digital Officer (2011-2018)
VP, Market strategy (2008-2011)
Management positions (2005-2008)
Management duties
Chairman of the Board of Directors of DKTV A/S.
Henrik Brandt
Chief Financial Officer
•
Born in 1981
•
Appointed in 2023
Education
BSc in Economics & Business administration, and
MSc in Management Accounting and Information
Technology, Aarhus University, Denmark.
Career
TDC NET A/S
2023 –
EVP, Chief Financial Officer
Vestas A/S
2007 - 2022
SVP, Chief Financial Officer, South Europe, MENA & LATAM (2017-2022)
VP, Head of Group FP&A & Performance management (2016-2017)
VP, Operational Performance & Cost Control (2013-2016)
Various management positions (2007-2013)
Management duties
Member of the Board of Directors of DKTV A/S.
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Policies and
grievance
mechanism
Our policies
TDC NET policies constitute the framework
for responsible business conduct and support
the governance of risks. We raise awareness
of our policies with new employees as part
of their onboarding. Accountability and
escalation routes for these policies culminate
with the Board of Directors and related
committees.
Our Whistleblower system
TDC NET is committed to providing a safe
environment for employees to speak up if
they witness misconduct. If employees or
business partners see or suspect a violation
of applicable laws or TDC NET’s policies and
procedures, we depend on them to report it
to our Whistleblower system. This allows for
the Whistleblower system to conduct a fair
and objective investigation and address the
issues. Our Whistleblower system is hosted
on a secure, external website to ensure an
independent and autonomous channel.
Reports can be made anonymously, and
all cases are kept confidential, except in
instances when this is specifically prohibited
by law. TDC NET has zero tolerance for
retaliation taken against whistleblowers and
witnesses. To support the availability of our
Whistleblower system, the system is publicly
accessible 24/7 on TDC NET’s corporate
website and internally on our intranet in
Danish and English. Additional information
about our Whistleblower system and how
to file a report is available through the link
provided in the table on the right side.
Our Whistleblower system is established
in accordance with the Danish legislation
on whistleblowers, and the implemented
grievance mechanism is designed to adhere
to the “Protect, Respect and Remedy”
framework of the United Nations Guiding
Principles on Business and Human Rights.
TDC NET policies
1
Environment Social
Governance
Sustainability Policy (external)
Supplier Code of Conduct (external)
1
External TDC NET policies are available via this link →
2
Approved by ESU.
3
Adopted by the Main Work Council (HSU) after recommendation from the bi-party H&S Committee (AmU).
Environmental Policy as
part of Sustainability
Policy (external)
HR Policy (internal)
2
Anti-Corruption Policy
as part of Sustainability
Policy (external)
Diversity and Inclusion
Policy (external)
Data Ethics and
Responsible Processing of
Data Policy (external)
Occupational Health and
Safety Policy (internal)
3
Disclosure Policy (internal)
Remuneration Policy
(external)
Information Security Policy
(internal)
Whistleblower Policy
(external)
Tax Principles (external)
71/154
Environmental data
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Intensity ratios 2023 2022 2021 2020 2019
Energy intensity (MWh of electrical
energy / PB of data throughput)
7.8
9.2
9.8
11.0
12.1
Carbon emissions intensity (tCO
2
e of
Scope 1 and 2 market-based emissions /
PB of data throughput)
1.4
3.6
4.5
4.7
5.1
Energy (MWh)
Emissions (metric tonnes CO
2
e) 2023 2022 2021 2020 2019
Scope 1
8,440
9,228
8,265
8,241
8,393
Scope 2 location-based
15,880
20,143
28,466
24,450
29,090
Scope 2 market-based
24,751
72,199**
81,873
72,825
71,678
Scope 3
83,719
88,478*
105,502*
126,012*
-
Total Scope 1, 2 and 3 market-based
emissions (metric tonnes CO
2
e)
116,910
169,904*
195,190*
207,078*
-
Total Scope 1 and 2 market-based
(metric tonnes CO
2
e); target baseline
33,191
81,426**
90,138
81,066
80,071
* These figures have been recalculated compared with the disclosed numbers in previous reports to ensure full year on year
comparability between reporting years. Further details can be found in the Scope 3 accounting principles on page 83.
** Corrections have been made to Scope 2 market-based emissions due to an update of the electricity and heat emission
factors that occurred after last year’s reporting.
Electricity
189,896
199,769
197,801
191,204
190,127
Heat
13,256
13,014
11,677
12,041
11,834
Transport
34,599
35,714
33,917
33,226
33,602
Total energy consumption (MWh)
237,751
248,497
243,395
236,471
235,563
Consumption of purchased or acquired
electricity from renewable sources
135,235
-
-
-
-
Consumption of purchased or acquired
electricity from non-renewable sources
54,661
-
-
-
-
Share of renewable electricity (%)
71%
-
-
-
-
72/154
Environmental data
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Scope 3 by category
(metric tonnes CO
2
e) 2023 2022 2021 2020 2019
1: Purchased goods and services & 2:
Capital goods
70,653
71,051*
86,658*
105,901*
-
2: Capital goods
Included
in cat. 1
Included
in cat. 1
Included
in cat. 1
Included
in cat. 1
-
3: Fuel and energy-related activities
4,616
9,827*
10,974*
10,368*
-
4: Upstream transportation and
distribution
942
1,268*
1,641*
1,372*
-
5: Waste generated in operations
32
67
32
23
-
6: Business travel
1,096
999*
806*
977*
-
7: Employee commuting
1,283
1,051
492
1,078
-
11: Use of sold products (direct)
2,994
2,650*
2,542*
4,503*
-
12: End-of-life treatment of sold
products
1
1*
1*
2*
-
13: Downstream leased assets
2,103
1,564*
1,904*
1,788*
-
Total Scope 3 emissions
(metric tonnes CO
2
e)
83,719
88,478*
105,052*
126,012*
-
* These figures have been recalculated compared with disclosed numbers in previous reports to ensure full year on year
comparability between reporting years. Further details can be found on page 83.
Waste (metric tonnes) 2023 2022 2021 2020 2019
Non-hazardous – landfill
4.2
2.8
3.1
21.7
-
Non-hazardous – composting
0.0
14.6
5.5
18.7
-
Non-hazardous – recycling
927.9
870.6
921.4
1,014.4
-
Non-hazardous – energy recovery and
incineration
342.6
360.5
370.8
519.8
-
Total non-hazardous waste (metric
tonnes)
1,274.8
1,248.4
1,300.9
1,574.6
-
Hazardous – landfill
0.0
0.0
0.1
-
-
Hazardous – composting
0.0
0.0
0.0
-
-
Hazardous – recycling
3.6
17.6
28.2
8.1
-
Hazardous – energy recovery and
incineration
1.0
0.6
0.7
0.5
-
Hazardous – other, incl. recycling and
energy recovery
0.0
0.0
0.0
0.1
-
Total hazardous waste (metric tonnes)
4.6
18.3
29.0
8.7
-
Total waste disposed (metric tonnes)
1,279.4
1,266.7
1,329.8
1,583.4
-
Waste recycled (%)
73%
70%
71%
65%
-
73/154
Social data
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Occupational health and safety –
Employees 2023 2022 2021 2020 2019
Fatalities (number)
Injuries with lost time – LTI (number)
Injuries without lost time (number)
0
24
84
0
29
65
0
39
53
0
31
50
0
25
40
Total injuries – TRI (number)
108
94
92
81
65
Days of absence (number)
274
189
437
410
289
Injury incidence (injuries with lost time
per 10,000 employees)
104
122
160
153
124
Rate of fatalities*
1
0
0
0
0
0
Lost time injury frequency rate
– LTIFR*
2
5.2
6.1
8.0
7.6
6.2
Total recordable injury frequency rate
– TRIFR*
3
23.5
19.8
18.9
20.0
16.2
Near-miss accidents reported (number)
2,087
924
169
20
-
Rate of near-miss accidents*
4
454
194
35
5
-
Fatalities - contractors
Fatalities (number)
0
0 0 0 0
Employees by gender (headcount)
Men (number)
2,130
2,318
2,375
2,181
-
Women (number)
587
639
633
495
-
Men (%)
78%
78%
79%
82%
-
Women (%)
22%
22%
21%
18%
-
* For calculation of rates from 2023 and onwards, we have changed yearly hours worked per employee from 1,645 hours to
2,000 hours in order to align with the methodology used in the European Sustainability Reporting Standards. Due to this
change, we have also changed the historic data to ensure comparability year on year.
1 Calculated as number of fatal accidents per one million working hours.
2 Calculated as number of injuries with lost time per one million working hours.
3 Calculated as total injuries (with/without lost time) per one million working hours.
4 Calculated as number of near-miss accidents per one million working hours.
Employees by employment category
(headcount – number) 2023 2022 2021 2020 2019
Executive Leadership Team – men
11
-
-
-
-
Executive Leadership Team – women
2
-
-
-
-
Senior Leadership Team – men
27
-
-
-
-
Senior Leadership Team - women
12
-
-
-
-
All people managers (total) – men
182
199
197
179
-
All people managers (total) – women
59
48
58
40
-
Non-managers – men
1,948
2,119
2,178
2,002
-
Non-managers – women
528
591
575
455
-
Employees by employment category (%)
Executive Leadership Team – men
85%
-
-
-
-
Executive Leadership Team – women
15%
-
-
-
-
Senior Leadership Team – men
69%
-
-
-
-
Senior Leadership Team – women
31%
-
-
-
-
All people managers (total) – men
76%
81%
77%
82%
-
All people managers (total) – women
24%
19%
23%
18%
-
Non-managers – men
79%
78%
79%
81%
-
Non-managers – women
21%
22%
21%
19%
-
74/154
Social data
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Employees by contract type (headcount
– number) 2023 2022 2021 2020 2019
Employees on permanent contracts
– men
2,125
2,316
2,354
2,173
-
Employees on permanent contracts
– women
585
633
609
489
-
Employees on temporary contracts
– men
5
2
21
8
-
Employees on temporary contracts
– women
2
6
24
6
-
Employees by employment type
(headcount – number)
Employees in full-time employment
– men
2,077
2,273
2,319
2,152
-
Employees in full-time employment
– women
555
592
582
459
-
Employees in part-time employment
– men
53
45
56
29
-
Employees in part-time employment
– women
32
47
51
36
-
Employees by age group (headcount –
number)
Employees under 30 years old
275
320
292
243
-
Employees 30-50 years old
1,113
1,190
1,186
1,026
-
Employees over 50 years old
1,329
1,447
1,530
1,407
-
Employees by age group (%) 2023 2022 2021 2020 2019
Employees under 30 years old
10%
11%
10%
9%
-
Employees 30-50 years old
41%
40%
39%
38%
-
Employees over 50 years old
49%
49%
51%
53%
-
Employee performance reviews – by
gender and employee category* (%)
% of appraisal
– managers/supervisors - men
84%
93%
93%
94%
-
% of appraisal
– managers/supervisors - women
90%
83%
96%
100%
-
% of appraisal
– non-management - men
94%
92%
95%
96%
-
% of appraisal
– non-management - women
90%
91%
91%
99%
-
Employee training
Average training hours (hours per FTE)
3.7
5.5 5.3 5.1 -
Employee statistics – other
% of total employees covered by
collective bargaining agreement (%)
88%
87%
-
-
-
Employee turnover rate – total (%)
16%
-
-
-
-
Fathers and non-birth mothers taking
parental leave (%)*
88%
95%
86%
68%
-
Number of different nationalities (number)
30
30
30
24
-
Age of oldest employee (years)
71
70
69
71
-
Age of youngest employee (years)
17
18
17
16
-
*Excluding Dansk Kabel TV employees.
75/154
Governance data
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Gender representation – Board of
Dansk
TDC
Holding
GDPR and security e-learning
Employees completing a GDPR
e-learning course (%)
94%
70%
98%
99%
-
Employees completing a voluntary
security e-learning course (%)
88%
74%
71%
77%
-
Gender representation – Board of
Directors of TDC NET 2023 2022 2021 2020 2019
Men (number)
3
4
5
-
-
Women (number)
3
2
1
-
-
Total
6
6
6
-
-
Men (%)
50%
67%
83%
-
-
Women (%)
50%
33%
17%
-
Independent board members
Data transported
Data transported (TB of data
throughput)
23,301,162
21,740,130 20,132,123
17,372,825 15,665,078
Supplier engagement
Percentage of independent board
members (%)
50%
- - - -
JAC audits
JAC audits conducted (number)
6
2
-
-
-
EcoVadis
Suppliers eligible for EcoVadis (number)
86
92
-
-
-
Suppliers reporting to EcoVadis (number)
52
40
-
-
-
Risk covered (Spend on suppliers
reporting to EcoVadis/Spend on
suppliers eligible for EcoVadis) (%)
71%
64%
-
-
-
Weighted average score of suppliers
reporting to EcoVadis (%)
65%
68%
-
-
-
Directors
TDC NET
Kabel TV
A/S
Data privacy
2023
2022
2021
2020
2019
Men (number)
3
4
4
Women (number)
3
0
2
Total
6
4
6
Men (%)
50%
100%
67%
Women (%)
50%
0%
33%
76/154
Governance data
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Whistleblower reports to TDC NET 2023 2022 2021 2020 2019
ESG ratings
CDP score
B
B
B
-
-
CDP supplier engagement score
A-
B
A-
-
-
EcoVadis award
*
Platinum
Platinum
Silver
Gold
GRESB infrastructure ESG score
95
96
86
65
61
Sustainalytics risk score
18.6 (Low)
-
12.8 (Low)
-
-
* Awaiting our 2023 EcoVadis score based on the submitted 2023 assessment.
Reports submitted to the
whistleblower system (number)
9
2 0 1 -
77/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
EU Taxonomy reporting
The EU Taxonomy (Regulation (EU) 2020/852)
is a classification system, for environmentally
sustainable economic activities, that helps
investors determine the sustainability of their
investments.
Eligibility versus alignment
An economic activity is considered taxonomy-eligible if it is
described in the Taxonomy’s delegated acts. To be considered
taxonomy-aligned (environmentally sustainable), the activity
must also:
•
Meet the substantial contribution criteria
•
Meet the ‘Does not significantly harm’ criteria
•
Be conducted in compliance with the minimum safeguards.
Assessing our Taxonomy-eligible activities
As a provider of digital infrastructure, TDC NET owns and
operates data centres. TDC NET’s eligible activities are related
to the EU Taxonomy’s activity 8.1 “Data processing, hosting
and related activities” in the appendix on climate mitigation.
These activities cover storage, manipulation, management,
movement, control, display, switching, interchange,
transmission or processing of data through data centres
including edge computing.
TDC NET’s Taxonomy-eligible, but not Taxonomy-aligned data
processing and hosting, is measured on three KPIs: 1) revenue,
2) capitalised expenditures (capex), and 3) operating expenses
(opex). The financial figures are presented in our Consolidated
Financial Statements 2023 on page 90 and onwards in this
report, prepared in accordance with International Financial
Reporting Standards (IFRS).
TDC NET's assessment is in compliance with Regulation (EU)
2020/852 and the associated amendments to the annexes of
the disclosure Delegated Act as issued on 13 June 2023.
KPI 1: Turnover
Numerator
Taxonomy-eligible turnover is calculated as the turnover
(revenue) generated from data processing and hosting
activities.
Denominator
Turnover (revenue) is defined on page 100 of this report, note
2.1 : Revenue.
KPI 2: Capex
Numerator
Taxonomy-eligible capex is defined as capex related to
investment in the efficiency of our data centres.
Denominator
Additions of tangible and intangible assets during the financial
year considered before depreciation, amortisation and any
remeasurements, including those resulting from revaluations
and impairments, for the relevant financial year and excluding
fair value changes. Additions of tangible and intangible assets
are presented in notes 3.1-3.3 in our Consolidated Financial
Statements.
KPI 3: Opex
Numerator
Taxonomy-eligible opex includes overall operational expenses
for the operation, maintenance and servicing of our data
centres.
Denominator
Opex is defined as direct non-capitalised costs that relate
to research and development, building renovation measures,
short-term leases, maintenance and repair, and any other
direct expenses relating to day-to-day servicing of property,
plant and equipment assets.
Double counting
We avoid double counting as the numbers are divded into
different data categories within the same data dimension (area
of responsibility). This ensures that data cannot be double
counted.
78/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Assessing our Taxonomy-aligned activities
Using the EU Taxonomy Compass, we have assessed whether
our eligible activities also meet the substantial contribution
and ‘does not significantly harm’ criteria while complying with
minimum safeguards. For an eligible activity to be considered
aligned, all criteria must be met.
The EU Taxonomy regulation is still evolving, and the
requirements for claiming Taxonomy-alignment continue to
increase. We have reviewed our eligible economic activity
8.1 against the extensive substantial contribution and ‘does
not significant harm’ criteria as well as minimum safeguards,
and we have evaluated that we currently do not have all the
required detailed documentation available. We have therefore
chosen to apply a conservative approach and not disclose any
Taxonomy alignment for the financial year of 2023.
As part of our ongoing preparations for compliance with
the EU Corporate Sustainability Reporting Directive, we are
developing detailed documentation that will also meet the
‘does not significantly harm’ criteria and minimum safeguards.
Potential to enable other sectors
The telecommunications sector has a potential to enable
other sectors to reduce their own carbon emissions via green
digital solutions. The current version of the EU Taxonomy does
not reflect the critical role of the telecommunications sector
in building infrastructure for the successful digitalisation of
society – now and in the future. Digital solutions are necessary
to achieve the EU Green Deal’s sustainability goals. With the
purpose of connecting Denmark, TDC NET is rolling out both
fibre and the 5G mobile network. Both solutions are considered
more energy efficient than previous alternatives. The EU
Taxonomy regulation does not include criteria for the economic
activity “Provision and operation of a network infrastructure
for telecommunications”, which is the core of TDC NET’s
business and has significant potential for enabling for the green
transition.
TDC NET is a member of the European Telecommunications
Network Operators Association (ETNO). Here, telco operators
collaborate for the inclusion of such criteria and improved
guidance in future versions of EU Taxonomy.
Proportion of
turnover/Total turnover
Proportion of
capex/Total capex
Proportion of
opex/Total opex
Taxonomy-aligned
per objective
Taxonomy-eligible
per objective
Taxonomy-aligned
per objective
Taxonomy-eligible
per objective
Taxonomy-aligned
per objective
Taxonomy-eligible per
objective
CCM
0%
0.23%
CCM
0%
1.09%
CCM
0%
5.98%
CCA
0%
0%
CCA
0%
0%
CCA
0%
0%
WTR
0%
0%
WTR
0%
0%
WTR
0%
0%
CE
0%
0%
CE
0%
0%
CE
0%
0%
PPC
0%
0%
PPC
0%
0%
PPC
0%
0%
BIO
0%
0%
BIO
0%
0%
BIO
0%
0%
79/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
KPI 1: Turnover
Financial year 2023 Year Substantial Contribution Criteria DNSH criteria ('Does Not Significantly Harm')(h)
Code (a) (2)
Economic
Activities (1)
Turnover DKKm (3)
Climate Change
Mitigation (5)
Proportion of
Turnover, year
2023 (4)
Climate Change
Adaptation (6)
Water (7)
Pollution (8)
Circular Economy
(9)
Climate Change
Mitigation (11)
Biodiversity (10)
Climate Change
Adaptation (12)
Water (13)
Pollution (14)
Circular Economy
(15)
Minimum
Safeguards (17)
Biodiversity (16)
Proportion of
Taxonomy aligned
(A.1.) or eligible
(A.2.) turnover, year
2022 (18)
Category enabling
activity (19)
Category
transitional
activity (20)
A. Taxonomy-eligible activities
A.1. Environmentally sustainable activities (Taxonomy-aligned)
Turnover of environmentally sustainable activities
(Taxonomy-aligned) (A.1)
0%
0%
0%
0%
0%
0%
0%
N
N
N
N
N
N
N
0%
Of which Enabling
0%
0%
0%
0%
0%
0%
0%
N
N
N
N
N
N
N
0%
E
Of which Transitional
0%
0%
N
N
N
N
N
N
N
0%
T
A.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (g)
Data processing, hosting and related
activities
8.1
15
0.23% EL
N/EL
N/EL
N/EL
N/EL
N/EL
0.23%
Turnover of Taxonomy-eligible but not
environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2)
8.1
15
0.23% 100%
0%
0%
0%
0%
0%
0.23%
A. Turnover of Taxonomy eligible
activities (A.1+A.2)
8.1
15
0.23% 100%
0%
0%
0%
0%
0%
0.23%
B. Taxonomy-non-eligible activities
Turnover of Taxonomy-non-eligible
activities
6,446
99.77%
Total
6,461
100%
80/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
KPI 2: Capex
Financial year 2023 Year Substantial Contribution Criteria DNSH criteria ('Does Not Significantly Harm')(h)
Code (a) (2)
Economic
Activities (1)
Capex DKKm (3)
Climate Change
Mitigation (5)
Proportion of
capex, year 2023
(4)
Climate Change
Adaptation (6)
Water (7)
Pollution (8)
Circular Economy
(9)
Climate Change
Mitigation (11)
Biodiversity (10)
Climate Change
Adaptation (12)
Water (13)
Pollution (14)
Circular Economy
(15)
Minimum
Safeguards (17)
Biodiversity (16)
Proportion of
Taxonomy aligned
(A.1.) or eligible
(A.2.) capex, year
2022 (18)
Category enabling
activity (19)
Category
transitional
activity (20)
A. Taxonomy-eligible activities
A.1. Environmentally sustainable activities (Taxonomy-aligned)
Capex of environmentally sustainable activities
(Taxonomy-aligned) (A.1)
0%
0%
0%
0%
0%
0%
0%
N
N
N
N
N
N
N
0%
Of which Enabling
0%
0%
0%
0%
0%
0%
0%
N
N
N
N
N
N
N
0%
E
Of which Transitional
0%
0%
N
N
N
N
N
N
N
0%
T
A.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (g)
Data processing, hosting and related
activities
8.1
33
1.09% EL
N/EL
N/EL
N/EL
N/EL
N/EL
0.83%
Capex of Taxonomy-eligible but not
environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2)
8.1
33
1.09% 100%
0%
0%
0%
0%
0%
0.83%
A. Capex of Taxonomy eligible activities
(A.1+A.2)
8.1
33
1.09% 100%
0%
0%
0%
0%
0%
0.83%
B. Taxonomy-non-eligible activities
Capex of Taxonomy-non-eligible activities
3,004
98.91%
Total
3,037
100%
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KPI 3: Opex
Financial year 2023 Year Substantial Contribution Criteria DNSH criteria ('Does Not Significantly Harm')(h)
Code (a) (2)
Economic
Activities (1)
Opex DKKm (3)
Climate Change
Mitigation (5)
Proportion of opex,
year 2023 (4)
Climate Change
Adaptation (6)
Water (7)
Pollution (8)
Circular Economy
(9)
Climate Change
Mitigation (11)
Biodiversity (10)
Climate Change
Adaptation (12)
Water (13)
Pollution (14)
Circular Economy
(15)
Minimum
Safeguards (17)
Biodiversity (16)
Proportion of
Taxonomy aligned
(A.1.) or eligible
(A.2.) opex year
2022 (18)
Category enabling
activity (19)
Category
transitional
activity (20)
A. Taxonomy-eligible activities
A.1. Environmentally sustainable activities (Taxonomy-aligned)
Opex of environmentally sustainable activities
(Taxonomy-aligned) (A.1)
0%
0%
0%
0%
0%
0%
0%
N
N
N
N
N
N
N
0%
Of which Enabling
0%
0%
0%
0%
0%
0%
0%
N
N
N
N
N
N
N
0%
E
Of which Transitional
0%
0%
N
N
N
N
N
N
N
0%
T
A.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (g)
Data processing, hosting and related
activities
8.1
57
5.98% EL
N/EL
N/EL
N/EL
N/EL
N/EL
5%
Opex of Taxonomy-eligible but not
environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2)
8.1
57
5.98% 100%
0%
0%
0%
0%
0%
5%
A. Opex of Taxonomy eligible activities
(A.1+A.2)
8.1
57
5.98% 100%
0%
0%
0%
0%
0%
5%
B. Taxonomy-non-eligible activities
Opex of Taxonomy-non-eligible activities
896
94.02%
Total
953
100%
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ESG accounting principles
Boundary setting
Based on our materiality assessment, the content of this report
focuses on the issues that we consider most material to our
business and society.
TDC NET’s ESG accounting principles set out the criteria,
assumptions and principles for calculating our environmental,
social and governance (ESG) data, aligned with international
reporting standards such as the Global Reporting Initiative
(GRI) and the GHG Protocol. This includes our energy
consumption, greenhouse gas emissions, waste, safety,
employee-related and governance data. The share of TDC
Group’s emissions is fully covered by TDC NET.
The scope covers our facilities in Denmark, equipment, supply
chain, operations and administration. Our ESG data includes
all companies under the umbrella of TDC NET, unless otherwise
stated. Dansk Kabel TV is included in all the environmental
data figures as well as employee figures reported, unless
otherwise stated. For health and safety figures, Dansk Kabel
TV is not included, as it has no system for safety reporting.
Fiberkysten’s transport-related consumption is also considered,
as TDC NET has partial ownership of the company.
Data collection period
Our ESG data was collected from 1 January to 31 December
2023.
Environment
Energy and carbon intensity ratios
Energy intensity is calculated based on electrical energy
consumed (MWh) per petabyte of actual data traffic output in
TDC NET’s network. The traffic reported is the average output
traffic measured at the periphery of the network over a year.
Carbon emissions intensity is calculated based on total direct
emissions from operations (Scope 1 and 2 greenhouse gas
emissions measured in tonnes of CO
2
e) per petabyte of actual
data traffic output in our network. The traffic reported is the
output traffic measured at the periphery of the network over
a year.
Energy
Electricity (MWh) measured directly by meters across our sites.
Heat (MWh) covering oil, natural gas and district heating taken
directly from supplier invoices as volume or cost.
Transport (MWh) covering fuel data from petrol and diesel
based on data from company fuel cards. From 2023 onwards,
electric vehicle electricity consumption is sourced from
TDC NET’s electric vehicle partner, Homecharge
Share of renewable electricity consumed is calculated by
dividing consumption of purchased or acquired electricity
from renewable sources (MWh) by consumption of purchased
or acquired electricity from non-renewable sources (MWh),
both obtained from EnergiDanmark and the other electricity
suppliers.
Consumption of purchased or acquired electricity from
renewable sources (MWh) is solely made up of TDC NET’s
Purchase Power Agreement (PPA) with Better Energy, through
which a fixed 140 GWh of solar electricity is delivered as part
of the commitment to renewable energy.
CO
2
e emissions calculation methodology
We report our emissions in line with the World Business Council
for Sustainable Development GHG Protocol methodology
which classes emissions into three groups: Scopes 1, 2 and 3.
2020 is our baseline year for our all scopes.
To calculate emissions, we apply specific conversion factors to
our activity data. We use emission factors from our suppliers,
from Energinet and from DEFRA (Department for Environment,
Food & Rural Affairs (2019) – UK Government GHG Emission
Conversion Factors for Company Reporting) to translate this
activity data into CO
2
and greenhouse gas (GHG) or CO
2
e
emissions.
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Scopes 1 and 2
To calculate our CO
2
e emissions, we collect activity data,
e.g., litres of gasoline and diesel and GWh consumed by
our technicians in their vans as well as GWh of electricity
purchased across our operations on an annual basis.
This data is sourced from:
•
Electricity: consumption is measured directly from ~15,000
meters across our sites.
Oil, natural gas, district heating: taken directly from
supplier invoices as volume or cost.
Transportation fuels: diesel and gasoline data from
company fuel cards, as these cards should be used for 100%
of fossil fuel purchased. From 2023 onwards, electric vehicle
electricity consumption is sourced from TDC NET’s electric
vehicle partner, Homecharge.
We use fuel conversion factors to convert our fuel into kWh.
For petrol, diesel, oil and natural gas, we use the official UK
government / DEFRA fuel conversion factors. These factors are
updated on an annual basis, according to the newest published
factors from DEFRA.
For location-based emission factors, there is a significant time
lag between our publication and the issuance of the correct
factor for the given year. In our reporting, we use the latest
available emission factors. Once the actual emission factors
are made available, we update our emissions to reflect any
possible change.
Emissions related to TDC Group are allocated to TDC NET.
Scope 3
Nine of the fifteen Scope 3 categories have been found to
be relevant for our business. In 2020, we performed our first
Scope 3 inventory and reported for 2019 and 2020. In 2023,
data calculation was further automated and methodological
improvements were applied. All changes were applied
retroactively going back to 2020 to ensure comparability
year-on-year. We report in line with the Scope 3 Guidance for
Telecommunication Operators published by GMSA/GeSI/ITU,
which complements the Greenhouse Gas Protocol.
Changes made in 2023 occurred in the following categories:
•
Categories 1 & 2:
- Inventories calculated automatically through the CO
2
e
module of the spend visibility tool Sievo going back to
2020. New inflation factors and exchange rates were
used compared with previous reporting years, as well as
consistent mappings for all years between the Exiobase
database of emission factors used by Sievo and our
procurement spend taxonomy.
- More suppliers moved from EEIO to Supplier Allocation
Method. Where previous years’ data was not available, the
closest full year data was applied retroactivily to years
without data.
- Product carbon footprint data was used for Radio Access
Network Hardware. Data is available for 2022 and 2023,
previous years’ was estimated based on CO
2
/DKK.
- All spend at subsidiaries is now included going back to
2020
•
Category 3 underwent methodological changes due to
unavailability of geography specific emission factors used in
previous years. Methodological changes have been applied
retroactively to ensure comparability.
Category 4 has an addition of spend on minor suppliers
that were previous reported in categories 1 & 2 and all
transportation spend at subsidiaries now goes back to 2020
Category 6 has additional activity allocated from
subsidiaries and also includes fuel purchased by employees
for business related travel.
Category 11 now assumes a 5-years lifetime for routers,
including a first time use of 3 years and a second life of a
refurbished device of two years.
Category 13 uses activity data for floorspace from the
Scope 1 and 2 tool in 2022 and 2023.
Category 1: Purchased goods and services & Category 2: Capex
These two categories are reported together. There are two
different methodologies for calculating emissions, depending
on data availability. They range from most to least accurate:
a) Product carbon footprint: When PCF data is
available, it is used. Spend on items with PCFs is then
removed from the total spend on those suppliers, and
method b) or c) is applied on the portion of the spend
without PCFs.
b) Supplier allocation method: If the transparency of supplier
data for Scopes 1, 2 and 3 is ‘sufficient’, then we calculate
our share of their emissions by using the following formula:
•
•
•
•
•
•
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•
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
TDC spend / Supplier revenue * Supplier footprint (Scope 1,
Scope 2 market & Scope 3 upstream).
There is a threshold for what is considered ‘sufficient’, where
the supplier must:
•
Publish Scope 1 emissions
•
Publish preferably, market-based Scope 2 emissions but
location-based emissions are used otherwise
Have a full Scope 3 inventory for upstream emissions, with a
minimum of purchased goods and services
The ‘sufficiency’ criteria are expected to be updated every
year for the top 100 suppliers ranked by EEIO. Average annual
exchange rates are used and the best available 12-month data
from each supplier.
c) Environmentally extended input output method: If
suppliers’ Scope 1, 2 and 3 data is insufficient, then we
estimate the footprint using EEIO modelling, based on the
Exiobase database.
Calculations are automated with the Sievo CO
2
module.
Category 3: Fuel and energy-related activities
To calculate these emissions, we use activity data from Scope
1 and market-based Scope 2 emission factors from EnergiNet,
DEFRA (Department for Environment, Food & Rural Affairs
(2021) – UK Government GHG Emission Conversion Factors for
Company Reporting) to CO
2
equivalent emissions.
Category 4: Upstream transportation
All transportation is accounted for in this category as we
source the transportation. Actual activity data is provided by
our transportation supplier, and we use estimated data based
on spend for subsidiaries and minor suppliers.
Category 5: Waste
We use supplier-specific tonnage for all waste. We use emission
factors from DEFRA (Department for Environment, Food &
Rural Affairs (2021) – UK Government GHG Emission Conversion
Factors for Company Reporting) to translate this activity data
into CO
2
equivalent emissions.
Category 6: Business travel
Air: use supplier specific data on km travelled on short,
medium, long-haul, business and economy, with DEFRA
emission factors
Hotel: use nights spent in each country and the DEFRA
emission factor
Rental cars: use supplier-specific and invoice data and
assume 50/50 split of petrol and diesel
Taxi: use invoice data and DEFRA emission factor for taxis
Public transport: use invoice data and supplier specific
emission factor (spend/revenue*CO
2
footprint of Danske
Statsbaner (DSB railway company)
Sea travel: estimate number of cars on ferry and used CO
2
/
kg transported
Category 7: Employee commuting
A 2020 survey of employees provided detailed responses on the
commuting habits of 115 employees. Using this information to
model trends for the whole organisation, we adjust it according
to office occupancy rates from facility management.
Category 11: Use of sold products
This category includes routers sold/leased as well as Optical
Network Terminals (ONT). To calculate the emissions
generated, we first determine the energy consumed by the
devices, based on the wattage for a typical user profile. To
calculate the lifetime of the device, we make type-specific
assumptions. Using the activity data generated from the
exercise, we calculate emissions using the location-based grid
emission factor from the national grid.
Category 12: End of life of sold products
This category includes ONTs sold to third parties over the
reporting year, and the number installed in that year.
Assumptions are made for the average composition of WEEE
and the end-of-life treatment.
Category 13: Downstream leased assets
For floor space leased for commercial and residential purposes,
we used m
2
data for each site. We estimated the electrical
consumption in kWh/m
2
for commercial using assumptions
based on TDC locations that are purely administrative, and
used the average residential kWh/m
2
for Denmark calculated
by Statistics Denmark.
Waste
TDC NET’s suppliers provide our consumption data. The data
is then split, based on the location of the waste, into three
categories; TDC Group, Nuuday and TDC NET. The waste
flows belonging to TDC Group are then assigned to Nuuday
•
•
•
•
•
•
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and TDC NET based on the employee ratio, excluding the
employees who are “on-site” technicians. The waste flows
are assigned to GRI categories, based on the type of waste
and the final waste route. The detailed guidance for the split
of the waste flows is provided in the waste data tool, which
is updated annually. Dansk Kabel TV is also included in the
overall waste volumes for TDC NET.
Social
Occupational health and safety
Fatalities is the number of fatal accidents reported during the
year. We report on number of fatalities for our own employees
and contractors separately.
Injuries with lost time (LTI) is the number of incidents reported
during the year where the employees did not come to work on
the following day due to the accident.
Injuries without lost time is the number of incidents reported
during the year where the employees came to work on the day
after the accident.
Total injuries (TRI) is the sum of fatalities, injuries with lost time
and injuries without lost time.
Days of absence is the total combined number of days where
employees were absent from work due to work-related
incidents.
Injury incidence is calculated as: (Number of injuries with lost
time/number of employees) x 10,000.
Rate of fatalities is calculated as the number of fatal
accidents per one million working hours. We calculate 2,000
hours worked yearly per FTE.
Lost time injury frequency rate (LTIFR) is calculated as the
number of injuries with lost time per one million working hours.
We calculate 2,000 hours worked yearly per FTE.
Total recordable injury frequency rate (TRIFR) is calculated as
the number of injuries with/without lost time per one million
working hours. We calculate 2,000 hours worked yearly per
FTE.
Near-miss accidents is the number of near-miss accidents
reported during the year.
Rate of near-miss accidents is calculated as the number
of near-miss accidents per one million working hours. We
calculate 2,000 hours worked yearly per FTE.
Employee data
Employees by gender is the number/percentage of employees
who are men and women, employed at the company at year
end.
Employees by employment category is the number/percentage
of employees who are employed at the company during
the reporting year at year end, who have managerial or
non-managerial responsibilities, divided by gender (men/women).
We report on the following leadership levels:
•
Executive Leadership Team (ELT) covering people managers
reporting to the CEO
•
Senior Leadership Team (SLT) covering people managers
reporting to ELT
All people managers (total) incl. ELT and SLT
Non-managers
People managers are defined as managers with minimum one
direct report.
Employees by contract type is the number of employees who
are employed at the company at year end, who had either a
permanent or temporary contract, divided by gender (men/
women).
Employees by employment type is the number of employees
who are employed at the company at year end, who were
either employed in a full-time or a part-time capacity, divided
by gender (men/women). A 37-hours workweek is considered
full-time, while working less than 37 hours a week is considered
part-time.
Employees by age group is the number/percentage of
employees who are employed at the company at year end,
divided into three age brackets: 1) employees under 30 years
old, 2) employees 30-50 years old and 3) employees over 50
years old.
Employee performance reviews is the percentage of employees
who are employed at the company during the reporting year
and at year end, who have received a performance review
during the reporting year, divided by gender (men/women) and
employee category (managerial responsibility/non-managerial
responsibility). Managers are defined as people managers with
minimum one direct report.
•
•
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Average training hours (hours per FTE) is calculated as the
total number of hours of training provided to employees in
2023 at TDC NET locations and paid for by TDC NET (internally
and externally), divided by the total number of employees at
year end (headcount).
Percentage of total employees covered by collective
bargaining agreements is the percentage of employees who
are employed at the company at year end, who were covered
by collective bargaining agreements.
Employee turnover rate (total) is the share of employees who
have left TDC NET within the last 12 months compared with
the average number of employees in the same period. The total
turnover rate covers both involuntary and voluntary turnover.
Percentage of fathers and non-birth mothers taking parental
leave includes every father or non-birth mother who started
or took paternity leave (maximum 2–4 weeks) in the period
1 January – 31 December 2022. Of these, we calculated how
many have subsequently taken parental leave with pay (up to
18 weeks, depending on the collective agreement) until (and
including) 31 December 2023. Employees who have not taken
additional leave and who have resigned up to 250 days after
paternity leave are excluded from the calculations. Source:
salary system.
Number of different nationalities counts from the Statistics
Denmark report.
Age of the oldest employee is the age in years of the employee
who is employed at the company at year end with the earliest
birthday compared with all other employees employed at the
company at the same time.
Age of the youngest employee is the age in years of the
employee who is employed at the company at year end
with the latest birthday compared with all other employees
employed at the company at the same time.
Due to changes in our company structure, historical figures
before 2020 are not available.
Dansk Kabel TV employees are part of the employee reporting
and figures.
Governance
Gender representation – Board of Directors is a number/
percentage of the number of directors on the Board of
Directors of TDC NET, Dansk Kabel TV and TDC Holding A/S
who are men and women, at year end of the reporting year.
Gender representation – Board of Directors of TDC NET
is a number/percentage of the number of directors on the
Board of Directors who are men and women, at year end of
the reporting year. This includes only directors elected by
the Annual General Meeting; employee representatives are
excluded.
Percentage of independent board members is calculated as
number of independent board members divided by the total
number of board members elected by the general meeting.
For definition of independent board members, we follow the
Danish recommendation for corporate governance.
Data privacy
Percentage of employees who completed a GDPR e-learning
course is calculated as the number of employees who were
employed at the company at the time of the last report
end of day at the 30 November and who completed a GDPR
e-learning course during the period of the campaign from the
start of October to the end of November, divided by the total
number of employees at the time of the 30 November who
were eligible to complete the training.
Percentage of employees who completed a voluntary
security e-learning course is the percentage of employees who
completed at least one NanoLearning activity by the end of
the reporting year. The figure only considers employees who
were employed at TDC NET, at year end, and were eligible
to take the training.Year end is defined as 31 December, only
e-learnings completed before this date are to be included in
the calculation for the reported figure.
Data transported
Data transported is delivered as total Terabytes (TB) of output
data for the whole network of TDC NET from 1 January to
31 December. This is based on average traffic measurements
sampled every 5 minutes, from which an average per second
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per year is calculated and converted into a ‘Terabytes per year’
datapoint.
Supplier engagement
JAC audits: TDC NET applies a risk-based Category
Management approach to determine eligibility for JAC audits.
Suppliers with a weighted average risk score of medium and
high for environmental or social impacts, that also have >DKK
10m are eligible, provided there is a fixed site to audit, such as
a factory. Data is consolidated annually, as are supplier risk
scores. Spend data is extracted from the spend visibility tool
Sievo, and audit reports are accessed through the JAC Audit
Management Platform. Factories in TDC NET’s supply chain
with on-site audits are defined as the number of JAC audits
conducted by any JAC member on sites belonging to or used by
a TDC NET supplier or sub-supplier.
EcoVadis: TDC NET applies a risk-based Category
Management approach to determine eligibility for EcoVadis
reporting. Suppliers with a weighted average risk score of
medium or high for environmental or social impacts, that also
have >DKK 1m, are eligible. Data is consolidated annually, as
are supplier risk scores. Spend data is extracted from the spend
visibility tool Sievo, and EcoVadis participation and scores are
determined through the EcoVadis platform.
Whistleblower reports to TDC NET
Reports submitted to the whistleblower system is measured
as the total number of reports submitted to TDC NET’s
whistleblower system from 1 January to 31 December.
TDC NET's whistleblower system is handled by an external law
firm.
External ratings
ESG ratings include our annual ratings in different rating
systems, for example our CDP score, CDP supplier engagement
score, the EcoVadis award, the GRESB infrastructure ESG score
and Sustainalytics risk score. This information can also be
found in publicly available sources and on the rating systems’
websites.
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
About the
Annual Report 2023
sustainability pages
The annual report represents TDC NET’s
compliance with sections 99a, 99b, 99d and
107d of the Danish Financial Statements Act.
International standards
The sustainability pages of this report have been prepared in
accordance with the Global Reporting Initiative Standards
‘Core’ option. The GRI Reference Index table is available on our
website link →, which specifies the GRI standards used and lists
the disclosures together with the appropriate references.
We have also provided information in alignment with the Task
Force on Climate Related Financial Disclosures (TCFD).
We have assessed eligibility according to the EU Taxonomy for
sustainable investment and the disclosure obligation in Article
8 of the regulation. See pages 77-81.
TDC NET’s participates in the UN Global Compact (UNGC). The
UN Global Compact has introduced a new Communication on
Progress (COP) system, hence TDC NET’s COP reporting will be
available on the UNGC’s COP platform together with our CEO’s
statement of continued support.
External assurance
Independent external assurance has been obtained for this
report.
The independent auditor’s report for our ESG data on pages
71-76 is provided by Deloitte and can be found on pages
151-152.
Availability
TDC NET’s sustainability reports for previous years are
available at tdcnet.dk.
For ESG data before 2020, read the annual reports for TDC
Group available at tdcgroup.com.
Please consult sustainability@tdcnet.dk for questions or
feedback on sustainability at TDC NET.
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Financial
statements
Consolidated financial statements →
Notes to consolidated financial statements →
Parent company financial statements →
Notes to parent company financial statements →
Management statement →
Independent auditor’s report →
Independent Auditor’s Assurance Report
on the ESG statement →
Annual Report 2023
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Consolidated
financial statements
Annual Report 2023
90/154
91/154
3.9%
2022
DKK 4,520m
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Income statement Statement of comprehensive income
(DKKm)
Note 2023 2022
(DKKm)
Note 2023 2022
Profit/(loss) for the year
(364 )
Total comprehensive income
(364 )
EBITDA
(Development)
2023
DKK 4,695m
Revenue
Cost of sales
2.1
2.2
(236 )
(262 )
Gross profit
External expenses
2.3
(914 )
(1,102 )
Personnel expenses
2.4
(994 )
(1,027 )
Other income
2.1
Operating profit before depreciation, amortisation and special
items (EBITDA)
Depreciation, amortisation and impairment losses
2.5
(2,926 )
(2,491 )
Special items
2.6
(78 )
(50 )
Operating profit (EBIT)
Financial income and expenses
4.4
(1,898 )
Profit before income taxes
(207 )
Income taxes
2.7
(157 )
(472 )
Profit/(loss) for the year
(364 )
Attributable to:
Shareholders
(364 )
Profit/(loss) for the year
(364 )
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Balance sheet
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Annual Report 2023
Assets (DKKm)
Note 2023 2022
Equity and liabilities (DKKm) Note 2023 2022
Non-current assets
Intangible assets 3.1,3.2
Property, plant and equipment 3.3
Lease assets 3.4
Joint ventures and associates
Amounts owed by group companies
Other receivables
Prepaid expenses
Total non-current assets
Current assets
Inventories
Trade receivables 3.5
Other receivables
Contract assets 3.6
Amounts owed by group companies
Derivative financial instruments
Prepaid expenses
Cash
Total current assets
Total assets
Equity
Share capital
Retained earnings
Total equity 4.1
Non-current liabilities
Deferred tax liabilities 2.7
Provisions 3.7
Loans 4.2,4.5
Spectrum licence fee liabilities 4.5
Lease liabilities 3.3
Other payables
Total non-current liabilities
Current liabilities
Loans 4.2,4.5
Spectrum licence fee liabilities 4.5
Lease liabilities 3.4
Trade payables
Other payables
Contract liabilities 3.6
Amounts owed to group companies
Income tax payable 2.7
Derivative financial instruments
Provisions 3.7
Total current liabilities
Total liabilities
Total equity and liabilities
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3,327
Statement of cash flows
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
(DKKm)
Note 2023 2022
Operating activities
Operating profit before depreciation, amortisation and special items
(EBITDA)
Adjustment for non-cash items
Payments related to provisions 3.7
Special items 2.6
Change in working capital 5.1
Interest received
Interest paid
Income tax paid 2.7
(44 )
(12 )
(57 )
(1,642 )
(234 )
(1 )
(7 )
(89 )
(1,022 )
(402 )
Total cash flow from operating activities
Investing activities
Investment in enterprises 5.2
Investment in property, plant and equipment 3.3
Investment in intangible assets 3.2
Investments in other non-current assets
Sale of property, plant and equipment
Loans to parent
(2,323 )
(610 )
(1 )
(126 )
(2,579 )
(728 )
(1 )
(2,045 )
Total cash flow from investing activities
(2,933 )
(5,478 )
(DKKm)
Note 2023 2022
Financing activities
Proceeds from long-term loans 4.2
Repayments of long-term debt 4.2
Settlement of derivatives related to long-term loans
Costs relating to long-term loans
Lease payments
Change in interest-bearing receivables and payables
Capital contribution
Dividend paid
(8,922 )
(301 )
(12,633 )
(45 )
(277 )
(8,750 )
Total cash flow from financing activities
(784 )
Total cash flow
Cash and cash equivalents at 1 January
Effect of exchange rate changes on cash and cash equivalents
(390 )
(6 )
Cash and cash equivalents at 31 December
Cash flow from operating activities
(DKKm)
A strong result from operating activities,
notably due to improved EBITDA of DKK
175m achieved through opex efficiencies and
effective working capital management.
94/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Statement of changes in equity
(DKKm)
Share capital
Retained
earnings¹
Total
Equity at 1 January 2022
Profit for the year
Total comprehensive income
Distributed dividends
(8,750 )
(8,750 )
Total transactions with shareholders
(8,750 )
(8,750 )
Equity at 31 December 2022
Loss for the year
(364 )
(364 )
Total comprehensive income
(364 )
(364 )
Capital contribution
Distributed dividends
(750 )
(750 )
Total transactions with shareholders
(733 )
(733 )
Equity at 31 December 2023
1
See also note 4.1 for an explanation of distributable reserves and dividend.
95/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Notes to
consolidated
financial
statements
Notes
Basis of preparation
1.1 Accounting policies 97
1.2 Critical accounting estimates and
judgements 98
1.3 New accounting standards 98
Profit for the year
2.1 Revenue 100
2.1 Revenue (continued) 101
2.2 Cost of sales 102
2.3 External expenses 102
2.4 Personnel expenses 103
2.5 Depreciation, amortisation and
impairment losses 104
2.6 Special items 104
2.7 Income taxes 105
Operating assets and liabilities
3.1 Impairment 109
3.2 Intangible assets 111
3.3 Property, plant and equipment 114
3.4 Lease assets and liabilities 116
3.5 Trade receivables 118
3.6 Contract assets and liabilities 119
3.7 Provisions 119
Capital structure and financing costs
4.1 Equity 122
4.2 Loans 122
4.3 Financial risks 127
4.4 Financial income and expenses 128
4.5 Maturity profiles of financial
instruments 129
Cash flow
5.1 Change in working capital 132
5.2 Investment in enterprises 132
5.3 Equity free cash flow 132
Other disclosures
6.1 Incentive programmes 134
6.2 Related parties 135
6.3 Fees to auditors 136
6.4 Other financial commitments 136
6.5 Pledges and contingencies 137
6.6 Events after the balance sheet date
137
6.7 Overview of group companies
at 31 December 2023 137
Section 1
Basis of
preparation
This section sets out the basis of preparation, which
relates to the financial statements as a whole. Where
an accounting policy is specific to one note, the policy
is described in the note to which it relates. Similarly,
critical sources of estimation uncertainty are described
in the notes to which they relate.
1.1 Accounting policies 97
1.2 Critical accounting estimates and
judgements 98
1.3 New accounting standards 98
Annual Report 2023
96/154
97/154
1.1 | Accounting policies
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Throughout the financial statements “the group”
refers to TDC NET Holding group and “parent” re-
fers to TDC NET Holding A/S. All figures in the
consolidated financial statements are consoli-
dated figures for TDC NET Holding group and fig-
ures in the parent company financial statements
are figures for TDC NET Holding A/S.
The group’s financial statements for 2023 have
been prepared in accordance with IFRS Account-
ing Standards as issued by the International
Accounting Standards Board (IASB) as adopted
by the European Union (EU) and further disclosure
requirements in the Danish Financial Statements
Act.
The consolidated financial statements are based
on the historical cost convention, except for fi-
nancial assets and liabilities that are initially
measured at fair value adjusted for transaction
costs if they are not subsequently measured at
fair value through the income statement. Trade
receivables are measured at their transaction
price.
When preparing the consolidated financial state-
ments, Management makes assumptions that af-
fect the reported amount of assets and liabilities
at the balance sheet date, and the reported in-
come and expenses for the accounting period.
The accounting estimates and judgements con-
sidered critical to the preparation of the consoli-
dated financial statements are shown in note 1.2.
The accounting policies are unchanged
compared with the policies applied in the
Annual Report 2022.
Consolidation policies
The consolidated financial statements include
the financial statements of the parent company
and subsidiaries of which the parent has direct or
indirect control.
The consolidated financial statements have been
prepared on the basis of the financial statements
of the parent and its consolidated companies,
which have been restated to group accounting
policies, combining items of a uniform nature.
On consolidation, intra-group income and ex-
penses; shareholdings, dividends, internal bal-
ances; and realised and unrealised profits and
losses on transactions between the consolidated
companies have been eliminated.
98/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
1.2 | Critical accounting estimates and
judgements
1.3 | New accounting standards
The preparation of the group’s annual report re-
quires Management to exercise judgement in ap-
plying the group’s accounting policies. It also re-
quires the use of estimates and assumptions that
affect the reported amount of assets, liabilities,
income and expenses. Actual results may differ
from those estimates.
Estimates and underlying assumptions are re-
viewed on an ongoing basis. Revisions are recog-
nised during the period in which the estimates
are revised and during any future periods af-
fected.
The following areas involve a higher degree of es-
timates or complexity and are outlined in more
detail in the related notes:
The group has adopted the new standards,
amendments to standards and interpretations
that are effective for the financial year 2023.
None of the changes have affected recognition or
measurement in the financial statements, nor are
they expected to have any future impact.
IASB has approved a number of new accounting
standards and changes to standards that are not
yet effective. The group has evaluated the stand-
ards and as none of them are expected to be rel-
Notes
Critical accounting estimates
and judgements
Estimates
/judgements
evant to the group, they are not expected to im-
pact on the financial statements.
2.1 Revenue
Assessment of contracts involving sale of complex
products and services
Estimate
/Judgement
2.6 Special items
Assessment of special events or transactions
Judgement
3.1 Impairment
Assumptions used for impairment testing
Estimate
/Judgement
3.2 Intangible assets
Assumptions for useful lives
Estimate
3.3 Property, plant
and equipment
Assumptions for useful lives
Estimate
(2.7)%
(17.6)%
Section 2
Profit for
the year
Annual Report 2023
Revenue
(Development)
YoY driven by acceleration in the consumer
transition towards high-speed technologies
This section focuses on disclosures of details of the
TDC NET Group’s results for the year including segment
reporting, special items and taxation.
2023:
6,461m
2022:
6,639m
2.1 Revenue 100
2.1 Revenue (continued) 101
2.2 Cost of sales 102
2.3 External expenses 102
2.4 Personnel expenses 103
2.5 Depreciation, amortisation and
impairment losses 104
2.6 Special items 104
Operational expenses
(Development)
Compared with 2022, achived through
mitigation of the electricity prices through PPAs
2023:
2.7 Income taxes 105
1,530m
2022:
1,857m
99/154
100/154
0.8%
2023 (DKKm)
2,411
2.1 | Revenue
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Specification of revenue from products (DKKm) 2023 2022
Comments
Critical accounting estimates and judgements
Revenue recognition for a telecom operator is a
complex area of accounting that requires man-
agement estimates and judgements.
Management applies judgement when determin-
ing whether revenue from a contract shall be rec-
ognised at a point of time or over time. When the
Group concludes contracts involving the sale of
complex products and services, management
judgements are required to determine whether
complex products or services shall be recognised
together or as separate products and services.
The group derives the vast majority of its rev-
enue from contracts with Nuuday A/S. In 2020
the group entered into a contract with
Nuuday A/S under which end-to-end mobile
services are provided. The contract has an
initial term of eight years, including an addi-
tional seven years phaseout period if the con-
tract is not extended. See also note 6.2.
TDC NET Group is an open-access connectiv-
ity provider of digital infrastructure, which is
the Group’s single business (operating) seg-
ment. The business segment reflects the way
in which Management makes decisions and
assesses the business performance.
Revenue streams from Internet & Network
(Development)
YoY due to shifts in our RGU bases towards
high-speed technologies with a higher ARPU
2022 (DKKm)
2,391
Landline voice
386
455
Mobile services
2,717
2,748
Internet & network
2,411
2,391
TV
413
443
Other services
534
602
Total
6,461
6,639
101/154
2.1 | Revenue (continued)
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Accounting policies
Revenue is measured at the fair value of the con-
sideration receivable after deducting sales tax
and discounts relating directly to sales. Revenue
comprises goods and services provided during the
year. Services include traffic and subscription
fees, interconnection fees, fees for leased lines,
network services, TV distribution as well as con-
nection and installation fees.
The group delivers services from plain access to
full-service packages to service providers, which
are partly regulated.
The significant sources of revenue are recognised
in the income statements as follows:
revenues from subscription fees and flat-rate ser-
vices are recognised over the subscription period
revenues from telephony are recognised at the
time the calls are made
sales related to prepaid products are deferred,
and revenues are recognised at the time of use
revenues from leased lines are recognised over
the rental period
revenues from the sale of equipment are recog-
nised on delivery. Revenues from the equipment
maintenance are recognised over the contract
period.
Revenue arrangements with multiple deliverables
are recognised as separate units of accounting,
independent of any contingent element related
to the delivery of additional items or other per-
formance conditions.
The transaction price in revenue arrangements
with multiple deliverables is allocated to each
performance obligation based on the stand-
alone selling price. Where the selling price is not
directly observable, it is estimated based on ex-
pected cost plus a margin. Discounts on bundled
sales are allocated to each element in the con-
tract.
Contracts with similar characteristics have been
evaluated using a portfolio approach due to the
large number of similar contracts.
In case of contracts for longer periods, and if the
payment exceeds the services rendered, contract
liabilities are recognised, see note 3.6.
The percentage-of-completion method is used to
recognise revenue from contract work in progress
based on an assessment of the stage of comple-
tion. Contract work in progress includes installa-
tion of telephone and IT systems, systems inte-
gration and other business solutions.
Non-refundable up-front connection fees are
included in the total transaction price for the
contract with the customer and thereby allo-
cated to the identified performance obligations
(services).
The period between the transfer of the service to
the customer and the payment by the customer
is not of an extent that gives reason to adjust the
transaction prices for the time value of money.
Other income
Other income comprises mainly accounting items
of a secondary nature such as profit from sale of
assets, termination of lease contracts and sale of
other services compared with the company’s
principal activities.
102/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
2.2 | Cost of sales 2.3 | External expenses
(DKKm)
2023 2022
Landline voice
(42)
(56)
Internet & network
(81)
(96)
TV
(4)
(8)
Other services
(109)
(102)
Total
(236)
(262)
Accounting policies
Cost of sales includes transmission costs and cost
of goods sold. Transmission costs include external
expenses related to operation of mobile and
landline networks and leased transmission ca-
pacity as well as interconnection costs related
directly to the primary income. Cost of sales also
includes terminal equipment and transmission
material.
(DKKm)
2023 2022
Properties and cars
(370)
(534)
IT and equipment regarding service contracts
(269)
(295)
Contractors and consultants
(122)
(117)
Temps and personnel-related expenses
(91)
(90)
Other
(62)
(66)
Total
(914)
(1,102)
Accounting policies
External expenses include expenses related to IT,
property, expenses related to staff, capacity
maintenance, service contracts. Contracts re-
garding solar parks are accounted as external ex-
penses.
Comments
The lower costs of properties and cars are
primarily due to costs related to power.
The reduction is caused by lower prices
and a switch to solar power.
103/154
2.4 | Personnel expenses
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
(DKKm)
2023 2022
Wages and salaries (including short-term and long-term bonuses)
(1,626)
(1,631)
Pensions (defined contribution plans)
(189)
(186)
Social security
(30)
(35)
Total
(1,845)
(1,852)
Of which capitalised as tangible and intangible assets
851
825
Total personnel expenses recognised in the income statement
(994)
(1,027)
Remuneration for the Executive Committee¹ and the Board of Directors
(DKKm) 2023 2022
Base salary (incl. benefits)
7,5
6,7
Cash bonus
2,8
2,4
Pensions
1,1
1,1
Long-term incentive programme
2,2
1,4
Management incentive programme
0,1
4,0
13,7
15,6
Redundancy compensation
1,7
2,5
Key management in total
15,4
18,1
Fee to the Board of Directors
8,2
6,7
Total
23,6
24,8
1
During 2023, the remuneration to the Executive Committee comprised 2 members on average (2022: 2 members).
Accounting policies
Wages, salaries, social security contributions,
paid leave and sick leave, bonuses and other em-
ployee benefits are recognised in the year in
which the employee renders the related services.
Comments
In 2023, the average number of full-time
employee equivalents was 2,696 (2022:
2,808).
Incentive programmes
See note 6.1.
104/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
2.5 | Depreciation, amortisation and
impairment losses
2.6 | Special items
(DKKm)
2023 2022
Amortisation of intangible assets, cf. note 3.2
(502)
(534)
Depreciation of property, plant and equipment, cf. note 3.3
(1,822)
(1,679)
Depreciation of lease assets, cf. note 3.4
(307)
(286)
Impairment losses, cf. notes 3.2 and 3.3
(312)
(11)
Of which capitalised as tangible and intangible assets
17
19
Total
(2,926)
(2,491)
Impairment losses in 2023 are affected by reas-
sessment of software that lead to a write-down
of DKK 265m.
(DKKm)
2023 2022
Costs related to redundancy programmes
Loss from rulings
Other restructuring costs, etc.
(73)
(5)
-
(43)
-
(7)
Special items before income taxes
Income taxes related to special items
(78)
17
(50)
11
Total special items
(61)
(39)
Cash flow from special items(DKKm) 2023 2022
Critical accounting
judgements
In the income statement, special items are pre-
sented as a separate item. Special items include
income or costs that in Management’s judge-
ment shall be disclosed separately by virtue of
their size, nature or incidence. In determining
whether an event or transaction is special, Man-
agement considers quantitative as well as quali-
tative factors such as the frequency or predicta-
bility of occurrence of the transaction or event,
including whether the event or transaction is
recurring. This is consistent with the way that
financial performance is measured by Manage-
ment and reported to the Board of Directors and
facilitates meaningful analysis of the operating
results of the group.
Accounting policies
Special items are significant amounts that
Management considers are not attributable to
normal operations such as restructuring costs and
special write-downs for impairment of intangible
assets and property, plant and equipment.
Special items are disclosed on the face of the
income statement.
Redundancy programmes
Other
(54)
(3)
(45)
(44)
Total
(57)
(89)
105/154
2.7 | Income taxes
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
2023 2022
Income taxes (DKKm)
Income taxes
expensed
Income tax
payable/
(receivable)
Deferred tax
liabilities/
(assets)
Income taxes
expensed
Income tax
payable/
(receivable)
Deferred tax
liabilities/
(assets)
At 1 January
Income taxes for the year
Adjustment of tax for previous years
Income tax paid
(189)
32
147
139
(30)
(234)
451
50
(2)
(489)
17
174
390
(15)
(402)
354
99
(2)
Total
(157)
22
499
(472)
147
451
Shown in the balance sheet as:
Tax payable/deferred tax liabilities
Tax receivable/deferred tax assets
22
-
499
-
147
-
451
-
Total
22
499
147
451
Income taxes are specified as follows:
Income excluding special items
Special items
(174)
17
(483)
11
Total
(157)
(472)
106/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
2.7 | Income taxes (continued)
Deferred tax (DKKm)
Deferred
tax
assets
2023 2022
Deferred
tax
liabilities Total¹
Other
(37)
-
(37)
(5)
Current
(37)
-
(37)
(5)
Intangible assets
-
735
735
726
Property, plant and equipment
(179)
-
(179)
(194)
Lease assets and liabilities
(11)
-
(11)
(24)
Other
(9)
-
(9)
(52)
Non-current
(199)
735
536
456
Deferred tax at 31 December
(236)
735
499
451
Comments
The parent and all its Danish subsidiaries
participate in joint taxation with DKT
Holdings ApS, which is the ultimate owner
of the group and management company in
the joint taxation. The jointly taxed com-
panies are jointly and severally liable for
the total income taxes, taxes paid on ac-
count and outstanding residual tax (with
additional payments and interest) relating
to the joint taxation.
107/154
Comments
The effective tax rate in 2023 is higher than
the statutory tax rate, which is due to a
negative effect from the limitation on the
tax deductibility of interest expenses.
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
2.7 | Income taxes (continued)
2023 2022
Effective tax rate (DKKm) DKKm % DKKm %
Accounting policies
Tax for the year comprises current income tax,
changes in deferred tax and adjustments from
prior years and is recognised in the income state-
ment, except to the extent that it relates to
items recognised in other comprehensive income.
Current income tax liabilities and current income
tax receivables are recognised in the balance
sheet as income tax payable or income tax
receivable.
Deferred tax is measured under the balance-
sheet liability method on the basis of all tempo-
rary differences between the carrying amounts
and the tax bases of assets and liabilities at the
balance sheet date. However, deferred tax is not
recognised if the temporary difference arises from
the initial recognition of goodwill or if it arises
from initial recognition of an asset or liability in a
transaction other than a business combination
that affects neither accounting nor taxable
profit/loss. Deferred income tax is provided on
temporary differences arising on investments in
subsidiaries, joint ventures and associates, except
where the timing of the reversal of the temporary
difference is controlled by the group and it is
probable that the temporary difference will not
reverse in the foreseeable future.
Deferred tax is adjusted concerning elimination of
unrealised intra-group profit and losses.
Deferred tax is measured on the basis of the tax
rules and tax rates effective under the legislation
in the respective countries at the balance sheet
date when the deferred tax is expected to be re-
alised as current income tax. Changes in deferred
tax as a result of changes in tax rates are recog-
nised in the income statement except for the ef-
fect of items recognised directly in other compre-
hensive income.
Deferred tax assets and liabilities are offset in the
consolidated balance sheet if the group has a le-
gally enforceable right to offset them, and the
deferred tax assets and liabilities relate to the
same legal tax entity.
Danish corporate income tax rate
28
22.0
(536)
22.0
Limitation on the tax deductibility of interest ex-
penses
(243)
(187.8)
24
(1.0)
Adjustment of tax for previous years
32
24.7
17
(0.7)
Other
9
6.2
12
(0.5)
Effective tax excluding special items
(174)
(134.9)
(483)
19.8
Special items
17
59.1
11
(0.1)
Effective tax including special items
(157)
(75.8)
(472)
19.7
(3.0)%
3.5%
Annual Report 2023
Section 3
Operating assets
and liabilities
This section shows the assets used to generate
Intangible assets
(Development)
2023:
11,377m
2022:
TDC NET’s performance and the resulting liabilities
incurred. Assets and liabilities relating to TDC NET’s
financing activities are addressed in Section 4. Deferred
tax assets and liabilities are shown in note 2.7.
3.1 Impairment 109
3.2 Intangible assets 111
3.3 Property, plant and equipment 114
3.4 Lease assets and liabilities 116
3.5 Trade receivables 118
3.6 Contract assets and liabilities 119
3.7 Provisions 119
11,726m
Property, plant and equipment
(Development)
2023:
16,807m
2022:
16,242m
108/154
109/154
3.1 | Impairment
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Impairment test of assets
The annual impairment test is an assessment of
whether the cash generating unit will be able to
generate sufficient positive net cash flow in the
future to support the carrying amount of the as-
sets related to the unit. The carrying amount of
assets with indefinite useful lives is tested for im-
pairment annually and if events or changes in cir-
cumstances indicate impairment. The annual
tests were carried out on 1 October 2023 and on
1 October 2022,
respectively.
Management has concluded any reasonably pos-
sible changes in the key assumptions are not ex-
pected to cause the carrying amount of assets to
exceed the recoverable value.
Cash-generating unit
There is only one cash-generating unit in TDC
NET which reflects the way management makes
decisions for the future activities and assesses the
business performance.
Key assumptions
Impairment testing is an integral part of the
group’s budget and planning process, which is
based on long-term business plans with projec-
Projections for the terminal period are based on
general expectations and risks, taking into ac-
count the general growth expectations for the
telecoms industry in Denmark..
The long-term business plans are based on cur-
rent trends. The budget period includes cash flow
effects from completed restructurings combined
with effects of strategic initiatives aimed at im-
proving or maintaining trend lines.
For the impairment testing of assets, the group
uses a pre-tax discount rate for the cash-gener-
ating unit.
The impairment test is sensitive to possible
changes in the key assumptions, which may re-
sult in future impairments. If the WACC applied
as discounting factor in the calculations in-
creases/ decreases by 1.0% and all other things
being equal, the value in use would decrease/in-
crease by DKK 10.2bn and 16.8bn, respectively.
Under the same assumptions, a 1.0% decrease/in-
crease in the market-based growth rate would
the value in use decrease/increase by DKK 8.2bn
and 13.4bn, respectively. A 10% increase/decrease
in EBITDA during the forecast period as well as
the terminal period would change the value in
impairment test has been prepared on the basis
that the company continues to operate with the
current set-up.
Assumptions regarding recoverable amounts
and projected earnings
Any reasonably possible changes in the key
assumptions are not expected to cause the car-
rying amount of assets to exceed the recoverable
value. Projections show steady EBITDA growth
and an increasing EBITDA margin in the long-
term based on the following assumptions:
• Steady growth in mobility services gross profit
Increased gross profit from highspeed broadband,
stemming from the group’s growing fibre foot-
print, continued large coax customer base and in-
creased ARPU from higher average speed on
products
Customer base for legacy products such as land-
line, TV and DSL assumed to decrease at higher
rates than historically
Short term increase in capital expenditure as part
of our end-to-end transformation to support long
term profitability in terms of both revenue
growth and cost savings. From 2025 and onwards
there will be a steady decrease in capex due to
cost optimisation and optimisation of ongoing in-
vestments to maintain capacity, quality etc. in
the networks
Savings driven by initiatives generated by our
end-to-end transformation programme with re-
ductions of both external and personnel ex-
penses.
tion until 2030 to reflect the long-term invest-
ments in fibre infrastructure. The discount rate
applied reflect specific risk relating to the cash-
generating unit. The recoverable amount is based
on the value in use determined on expected cash
flows based on long-term business plans ap-
proved by Management.
use by DKK 6.9bn. All the above-mentioned
changes in key assumptions would not cause the
carrying amount of goodwill to exceed the recov-
erable value. With the present relation between
WACC and growth rate the WACC can increase
to approximately 13.3% pre-tax with a growth
rate at 3.7% before the carrying amount of good-
will will exceed the recoverable value. The
Key assumptions for calculating the value in use for the significant goodwill
and brand amounts (DKKm) 2023 2022
Carrying amount of goodwill at 31 December (DKKm)
6,980
6,980
Carrying amount of brand at 31 December (DKKm)
1,287
1,287
Market-based growth rate applied at 1 October to extrapolated
projected future cash flows for the period following 2030
2.3%
2.3%
Applied pre-tax discount rate at 1 October
8.2%
8.5%
110/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.1 | Impairment (continued)
Critical accounting estimates
and judgements
Impairment testing of intangible assets
Intangible assets comprise a significant portion of
the group’s total assets. The measurement of the
recoverable amount of intangible assets is a
complex process that requires significant Man-
agement judgements in determining various as-
sumptions to be used in the calculation of cash-
flow projections, discount rates and terminal
growth rates. Management has identified cost
drivers, etc. in the activity-based costing model
that is used for calculating the value in use of the
cash-generating unit. Management has identified
one cash-generating unit, since the cash flow is
not generated independently from the other part
of the businesses.
The sensitivity of changes in the assumptions
used to determine the recoverable amount may
be significant. Furthermore, the use of other esti-
mates or assumptions when determining the re-
coverable amount of the assets may result in
other values and could result in required impair-
ment of assets.
Accounting policies
Impairment tests on intangible assets with indefi-
nite useful lives and other non-current assets are
performed at least annually and, if necessary,
when events or changes in circumstances indicate
that their carrying amounts may not be recover-
able. All assets are tested if an event or circum-
stance indicates that the carrying amount may
not be recoverable. If an asset’s carrying amount
exceeds its recoverable amount, an impairment
loss is recognised. The recoverable amount is the
higher of the asset’s fair value less costs of dis-
posal and its value in use.
111/154
3.2 | Intangible assets
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
2023 2022
(DKKm)
Goodwill Brands Licences
Other rights,
software, etc. Total Goodwill Brands Licences
Other rights,
software, etc. Total
Cost at 1 January
6,980
1,287
3,941
4,337
16,545
6,980
1,287
4,423
3,798
16,488
Additions
-
-
-
418
418
-
-
-
536
536
Additions related to acquisition of activities
-
-
-
-
-
-
-
-
126
126
Assets disposed of or fully amortised
-
-
(2)
(598)
(600)
-
-
(482)
(123)
(605)
Cost at 31 December
6,980
1,287
3,939
4,157
16,363
6,980
1,287
3,941
4,337
16,545
Amortisation and impairment losses at 1 January
-
-
(1,505)
(3,314)
(4,819)
-
-
(1,840)
(3,049)
(4,889)
Amortisation
-
-
(148)
(354)
(502)
-
-
(147)
(387)
(534)
Impairment
-
-
-
(265)
(265)
-
-
-
(1)
(1)
Assets disposed of or fully amortised
-
-
2
598
600
-
-
482
123
605
Amortisation and impairment losses at 31 December
-
-
(1,651)
(3,335)
(4,986)
-
-
(1,505)
(3,314)
(4,819)
Carrying amount at 31 December
6,980
1,287
2,288
822
11,377
6,980
1,287
2,436
1,023
11,726
Cash flow (DKKm) 2023 2022
Additions, cf. table on previous page
Instalments regarding mobile licences
(418)
(192)
(536)
(192)
Cash flow from investment in intangible assets
(610)
(728)
112/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.2 | Intangible assets (continued)
Comments
Assets with indefinite useful lives other than
goodwill related to the TDC brand were un-
changed at DKK 1,287m compared with 2022.
The carrying amount of software amounted
to DKK 822m (2022: DKK 1,023m). The addi-
tion of internally developed software totalled
Software in progress amounted to DKK 277m
(2022 DKK 348m)
The carrying amount of Danish spectrum mo-
bile licences amounted to DKK 2,288m (2022:
DKK 2,436m) and is shown in the next table.
Of this, DKK 228m relates to licences not yet
Spectrum licences
Spectrum (MHz) Bandwidth (MHz) Licence expiry
700
2 x 15 + 1 x 20
2040
800
2 x 20
2034
900
2 x 10
2034
1500
45
2042
1800
2 x 20
2032
2100
2 x 20
2042
2300
100
2041
DKK 140m (2022: DKK 139m).
in use, which is unchanged from last year.
2600
2 x 20
2030
3500
130
2042
26000
1250
2042
113/154
Mobile licences
Other rights, software,
etc
16-22 years
3-5 years
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.2 | Intangible assets (continued)
Critical accounting estimates
and judgements
Useful lives
Management estimates useful lives for intangible
assets based on periodic studies of customer
churn or actual useful lives and the intended use
for those assets. Such studies are completed or
updated when new events occur that may have
the potential to impact the determination of the
useful life of the asset, i.e. when events or circum-
stances occur that indicate that the carrying
amount of the asset may not be recoverable and
should therefore be tested for impairment. Any
change in customer churn or the expected useful
lives of these assets is recognised in the financial
statements, as soon as any such change has been
ascertained, as a change of a critical accounting
estimate.
Accounting policies
Goodwill and brands with indefinite useful lives
are recognised at cost less accumulated write-
downs for impairment. Write-downs of goodwill
are not reversed.
Brands with finite useful lives, proprietary rights,
etc. are measured at cost less accumulated
amortisation and impairment losses and are
amortised on a straight-line basis over their esti-
mated useful lives.
Development projects, including costs of com-
puter software purchased or developed for inter-
nal use, are recognised as intangible assets if the
cost can be calculated reliably and if they are
expected to generate future financial benefits.
Costs of development projects include wages,
external charges, depreciation and amortisation
that are directly attributable to the development
activities as well as interest expenses in the pro-
duction period.
Development projects that do not meet the
criteria for recognition in the balance sheet are
expensed as incurred in the income statement.
The main amortisation periods are as follows:
Development projects in process and intangible
assets of indefinite useful lives are tested for
impairment at least annually and written down
to recoverable amounts in the income statement
if exceeded by the carrying amount.
Intangible assets are recorded at the lower of
recoverable amount and carrying amount.
114/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.3 | Property, plant and equipment
(DKKm)
2023 2022
Network
Network
Land and
infra-
Assets under
Land and
infra-
Assets under
buildings
structure
Equipment
construction
Total
buildings
structure
Equipment
construction
Total
Cost at 1 January
502
43,898
1,271
666
46,337
495
41,625
1,185
715
44,020
Transfers (to)/from other items
1
435
31
(467)
-
2
482
12
(496)
-
Additions
1
1,914
82
438
2,435
5
1,861
98
447
2,411
Assets disposed of
(1)
(30)
(39)
-
(70)
-
(70)
(24)
-
(94)
Cost at 31 December
503
46,217
1,345
637
48,702
502
43,898
1,271
666
46,337
Depreciation and impairment losses at 1 January
(164)
(28,637)
(955)
(339)
(30,095)
(158)
(27,167)
(837)
(337)
(28,499)
Depreciation
(4)
(1,683)
(135)
-
(1,822)
(6)
(1,531)
(142)
-
(1,679)
Impairment
-
(29)
(1)
(17)
(47)
-
(9)
-
(2)
(11)
Assets disposed of
-
30
39
-
69
-
70
24
-
94
Depreciation and impairment losses at 31 December
(168)
(30,319)
(1,052)
(356)
(31,895)
(164)
(28,637)
(955)
(339)
(30,095)
Carrying amount at 31 December
335
15,898
293
281
16,807
338
15,261
316
327
16,242
Cash flow (DKKm) 2023 2022
Additions, cf. table above
(2,435)
(2,411)
Non-cash additions/deductions regarding decommissioning obligations
(38)
(35)
Change in additions not yet paid
125
(152)
Capitalised interest
8
-
Capitalised depreciations cf. note 2.5
17
19
Cash flow from investment in property, plant and equipment
(2,323)
(2,579)
115/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.3 | Property, plant and equipment (continued)
Critical accounting
estimates
Depreciation are based on management’s esti-
mates of residual value, depreciation method
and the useful lives of property, plant and equip-
ment. Estimates may change due to technologi-
cal developments, changes in market conditions
and other factors and may result in changes in
the estimated useful lives and in the depreciation
charges. Technological developments are difficult
to predict and the Group’s views on the trends
and pace of development may change over time.
The impact of expected developments in tech-
nology and markets are critical estimates in the
evaluation of useful lives. The useful lives are
reviewed at least annually taking into considera-
tion the factors mentioned above and all other
important relevant factors. A change in esti-
mated useful lives is a change in accounting esti-
mate, and depreciation plans are adjusted pro-
spectively
In 2023 copper estimated useful lives are revalu-
ated due to the technological developments and
depreciation plans are adjusted in accordance to
this. The effect in 2023 are DKK 77m higher de-
preciations.
Accounting policies
Property, plant and equipment are measured at
cost less accumulated depreciation and impair-
ment losses.
Cost comprises purchase price and costs directly
attributable to the acquisition until the date on
which the asset is ready for use. The cost of self-
constructed assets includes directly attributable
payroll costs, materials, depreciation, parts pur-
chased and services rendered by sub-suppliers or
contractors as well as interest expenses in the
construction period. Cost also includes estimated
decommissioning costs if the related obligation
meets the conditions for recognition as a provi-
sion.
Directly attributable costs comprise personnel
expenses together with other external expenses
calculated in terms of time spent on self-con-
structed assets.
The depreciation base is measured at cost less
residual value and any impairment. Depreciation
is provided on a straight-line basis over the esti-
mated useful lives of the assets. The main depre-
ciation periods are as shown in the next table.
The useful lives and residual values of the assets
are reviewed regularly. If the residual value ex-
ceeds the carrying amount of an asset, deprecia-
tion is discontinued.
Property, plant and equipment that have been
disposed of or scrapped are eliminated from ac-
cumulated cost and accumulated depreciation.
Gains and losses arising from sale of property,
plant and equipment are measured as the differ-
ence between the sales price less selling expenses
and the carrying amount at the time of sale. The
resulting gain or loss is recognised in the income
statement under other income or other expenses.
Software that is an integral part of telephone ex-
change installations, for example, is presented
together with the related assets. Useful lives are
estimated individually.
Installation materials to be used in the construc-
tion of assets are measured at the lower of
weighted average cost and recoverable amount.
Customer-placed equipment is capitalised and
depreciated over the estimated useful life of the
individual asset.
Buildings
Network infrastructure:
mobile networks
copper
coax
fibre
exchange equipment
other network
equipment
Equipment
(computers, tools and
office equipment)
20 years
20 years
17-20 years
20 years
30 years
3-15 years
3-20 years
3-15 years
116/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.4 | Lease assets and liabilities
2023 2022
Lease assets (DKKm)
Carrying amount at 1 January
1,022
9
196
1,227
1,065
12
141
1,218
Additions
130
-
54
184
181
-
119
300
Disposals
(124)
-
(9)
(133)
(1)
-
(4)
(5)
Depreciation
(244)
(2)
(61)
(307)
(223)
(3)
(60)
(286)
Carrying amount at 31 December
784
7
180
971
1,022
9
196
1,227
Lease liabilities (DKKm) 2023 2022
Amounts recognised in the income statement (DKKm) 2023 2022
Expense relating to short-term leases
(36)
(58)
Expense relating to leases of low-value assets
(1)
(1)
Depreciation charge of lease assets, cf. above
(307)
(286)
Interest expense (included in financing costs)
(35)
(36)
Comments
The total cash outflow for leases in 2023
amounted to DKK 336m (2022: DKK 313m).
The amount is excluding short-term leases
and leases of low-value assets.
TDC NET is continuously aiming at decommis-
sioning legacy networks as a measure to ob-
tain costs savings. The decommissioning plans
imply a reduced need for leasing square
meters for technical equipment and as a re-
sult TDC NETs leasing agreement with TDC
Holding related to technical premises were
amended with regard to the notice period.
Based on the new contracts the lease periods
for the lease assets and liabilities have been
reassessed which resulted in a net gain of DKK
58m recognised in other income.
Recognised in the balance sheet at present value:
External lease liabilities
Lease liabilities due to group companies
484
540
487
845
Total
1,024
1,332
Of which presented as current
(352)
(296)
Total non-current
672
1,036
Maturing between 1 and 3 years
400
488
Maturing between 3 and 5 years
119
374
Maturing between 5 and 10 years
104
114
Maturing between 10 and 20 years
49
60
Total non-current
672
1,036
Land and
Network
Vehicles and
Land and
Network
Vehicles and
buildings
infrastructure
equipment
Total
buildings
infrastructure
equipment
Total
117/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.4 | Lease assets and liabilities (continued)
Reconciliation of lease liabilities (DKKm) 2023 2022
Comments
Lease payments to be made under reasonably
certain extension options are also included in the
measurement of the liability.
The lease payments are discounted using the in-
terest rate implicit in the lease. If that rate can-
not be readily determined, which is generally the
case for leases in the Group, the lessee’s incre-
mental borrowing rate is used, being the rate
that the lessee would have to pay to borrow the
funds necessary to obtain an asset of similar
value to the lease asset in a similar economic en-
vironment with similar terms, security and condi-
Lease assets are measured at cost less accumu-
lated depreciation and impairment losses. Cost
comprises the following:
the amount of the initial measurement of lease
liability
any lease payments made at or before the com-
mencement date less any lease incentives re-
ceived
any initial direct costs
decommissioning costs.
Lease assets are generally depreciated over the
The Group leases various offices, mobile sites,
retail stores, vehicles and equipment. Rental
contracts are typically made for fixed periods
of 3 to 15 years but may have extension op-
tions.
Accounting policies
Assets and liabilities arising from leases are ini-
tially measured on a present value basis. Lease li-
abilities include the net present value of the fol-
lowing lease payments:
fixed payments (including in-substance fixed
payments), less any lease incentives receivable
variable lease payments that are based on an in-
dex or a rate, initially measured using the index
or rate as at the commencement date
Lease terms are negotiated on an individual
basis and contain a wide range of different
terms and conditions. The lease agreements
do not impose any covenants other than the
security interests in the leased assets that are
held by the lessor. Leased assets may not
be used as security for borrowing purposes.
amounts expected to be payable by the Group
under residual value guarantees
the exercise price of a purchase option if the
Group is reasonably certain to exercise that op-
tion, and
payments of penalties for terminating the lease,
if the lease term reflects the Group exercising
that option.
tions.
The incremental borrowing rates are based on
our existing credit facilities and observable mar-
ket data.
The Group is exposed to potential future in-
creases in variable lease payments based on an
index or rate, which are not included in the lease
liability until they take effect. When adjustments
to lease payments based on an index or rate
take effect, the lease liability is reassessed and
adjusted against the lease asset.
Lease payments are allocated between instal-
ment and financing costs. The financing costs are
charged to the income statement over the lease
period so as to produce a constant periodic rate
of interest on the remaining balance of the liabil-
ity for each period.
shorter of the asset’s useful life and the lease
term on a straight-line basis. If the Group is rea-
sonably certain to exercise a purchase option,
the lease asset is depreciated over the underlying
asset’s useful life cf. note 3.3.
Impairment tests on lease assets are performed
when circumstances indicate their carrying
amounts may not be recoverable. Impairment of
lease assets related to vacant tenancies is based
on expectations concerning timing and scope, fu-
ture cost level, etc. Write-downs comprises rent
and operating costs for the contract period minus
the expected rental income from subleases.
Payments associated with short-term leases of
equipment and vehicles and all leases of low-
value assets are expensed as incurred. Short-term
leases are leases with a lease term of 12 months
or less. Low-value assets comprise IT equipment
and small items of office furniture.
Carrying amount at 1 January
1,332
1,313
Lease payments
(301)
(277)
New lease contracts
183
300
Other non-cash movements
(190)
(4)
Carrying amount at 31 December
1,024
1,332
118/154
3.5 | Trade receivables
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
(DKKm)
2023 2022
Trade receivables
Expected credit losses
400
(21)
382
(17)
Trade receivables, net
379
365
Expected credit losses at 1 January
(17)
(19)
Expected credit losses recognised
(8)
(10)
Realised credit losses
2
2
Reversed expected credit losses
2
10
Expected credit losses at 31 December
(21)
(17)
Accounting policies
Trade receivables are amounts due from custom-
ers for goods sold or services performed in the or-
dinary course of business. The group operates
with standard customer payment terms where
customer subscriptions are billed and paid in ad-
vance of the subscription period, while usage and
one-off services are billed and paid after the sub-
scription period. The receivables are generally
due for settlement within 20-30 days and are
therefore all classified as current. Trade receiva-
bles are recognised initially at the amount of
consideration that is unconditional. The Group
holds the trade receivables with the objective of
collecting the contractual cash flows and there-
fore measures them subsequently at amortised
Trade receivables (DKKm) Not yet due
2023
Less than
1 month
past due
More than
1 month
past due
More than
3 months
past due
More than
6 months
past due Total
cost using the effective interest method.
The group applies the simplified approach to
measure expected credit losses, which uses a life-
time expected loss allowance for all trade receiv-
Expected loss rate 0% 0% 0% 50% 83% 6%
ables, contract assets and lease receivables. To
Gross carrying amount 273 97 4 2 24 400
Expected credit losses - - - (1) (20) (21)
2022
Expected loss rate 0% 0% 0% 50% 64% 4%
Gross carrying amount 334 19 2 2 25 382
Expected credit losses - - - (1) (16) (17)
measure the expected credit losses, receivables
have been grouped based on shared credit risk
characteristics and the days past due. The ex-
pected loss rates are based on the payment pro-
files of sales and the corresponding historical
credit losses experienced. The historical loss rates
are adjusted to reflect current and forward-look-
ing information on macroeconomic factors af-
fecting the ability of the customers to settle the
receivables.
Comments
The carrying amount of the balance’s ap-
proximated fair value is due to the short
maturity of amounts receivable.
119/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.6 | Contract assets and liabilities 3.7 | Provisions
(DKKm)
2023 2022
1 January
2022
Decom-
2023
2022
Restruc-
missioning turing
Other
(DKKm) obligations obligations provisions Total
Accounting policies
Deferred subscription income recognised as a lia-
bility comprises payments received from custom-
ers covering income in subsequent years.
S
p
e
c
i
f
i
c
a
t
i
o
n
Specification of how payments regarding provisions are
recognised in the statements of cash flow (DKKm) 2023 2022
Payments related to provisions
Cash flow related to special items
(12)
(46)
(7)
(29)
Total
(58)
(36)
Provisions at 1 January
275
23
30
328
360
Provisions made
4
73
3
80
42
Change in present value
(28)
-
-
(28)
(31)
Provisions used (payments)
(1)
(57)
-
(58)
(36)
Unused provision reversed
-
-
-
-
(7)
Provisions at 31 December
250
39
33
322
328
Of which recognised through special
items in the income statement
34
2
36
19
Recognised as follows in the balance
sheet:
Non-current liabilities
250
6
33
289
309
Current liabilities
-
33
-
33
19
Total
250
39
33
322
328
Comments
Revenue recognised in 2023 that was
included in deferred subscription income
at the beginning of the period amounted
to DKK 461m (2022: DKK 464m).
Work in progress for the account of third parties
69
57
52
Total contract assets
69
57
52
Deferred subscription income
183
193
184
Deferred subscription income from contracts
with group companies
325
269
280
Other deferred income
98
11
13
Total contract liabilities
606
473
477
120/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
3.7 | Provisions (continued)
Comments
Provisions for decommissioning obligations
related to the future dismantling of mobile
stations and restoration of property owned by
third parties. The uncertainties related primar-
ily to the timing of the related cash outflows.
The majority of these obligations are not ex-
pected to result in cash outflow within the
next five years.
Provisions for restructuring obligations related
primarily to redundancy programmes. The
majority of the provisions for redundancy pro-
grammes are expected to result in cash out-
flows in the next five years. The uncertainties
related primarily to the estimated amounts
and the timing of the related cash outflows.
l
Other provisions related mainly to onerous
contracts and jubilee benefits for employees
as well as legal claims. The majority of these
provisions are not expected to result in cash
outflows in the next five years. The uncertain-
ties regarding legal claims and onerous con-
tracts related to both timing and estimated
amounts. The uncertainties regarding jubilee
benefits related to both salary and the num-
ber of employees included.
The Group’s total redundancy costs included
wages during the notice period, severance
pay, stand-off pay, payments pursuant to the
Danish Salaried Employees Act, social security
contributions and outplacement costs.
Accounting policies
Provisions are recognised when the Group has a
legal or constructive obligation arising from past
events, it is probable that economic benefits
must be sacrificed to settle it, and the amount
can be estimated reliably.
Provisions for restructuring, etc. are recognised
when a final decision thereon has been made be-
fore or on the balance sheet date and has been
announced to the parties involved, provided that
the amount can be measured reliably. Provisions
for restructuring are based on a defined plan,
which means that the restructuring commences
immediately after the decision has been made.
When the Group is under an obligation to demol-
ish an asset or re-establish the site where the as-
set was used, a liability corresponding to the pre-
sent value of estimated future costs is recognised
and an equal amount is capitalised as part of the
initial carrying amount of the asset. Subsequent
changes in such a decommissioning liability that
results from a change in the current best esti-
mate of cash flows required to settle the obliga-
tion or from a change in the discount rate are
added to (or deducted from) the amount recog-
nised for the related asset. However, to the ex-
tent that such a treatment would result in a neg-
ative asset, the effect of the change is recognised
as profit for the year.
Provisions are measured at Management’s best
estimate of the amount at which the liability is
expected to be settled. Provisions are discounted
if the effect is material to the measurement of
the liability.
Section 4
Capital structure
and financing costs
This section includes disclosures related to TDC NET’s
capital structure and related financing costs as well as
finance-related risks and how these are managed.
4.1 Equity 122
4.2 Loans 122
4.3 Financial risks 127
4.4 Financial income and expenses 128
4.5 Maturity profiles of financial
instruments 129
Annual Report 2023
Net Interest Bearing Debt
(DKK)
9m
2023:
24,823m
2022:
24,814m
121/154
122/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
4.1 | Equity 4.2 | Loans
Accounting policies
Dividends
Dividends expected to be distributed for the
year are recognised in a separate item in equity.
Dividends and interim dividends are recognised as
a liability at the time of adoption by the Annual
General Meeting and the meeting of the Board of
Directors, respectively.
Comments
The total authorised number of shares is
500,000 with a par value of DKK 1 per
share. All issued shares are fully paid up.
During 2023, total equity decreased by
DKK 1,097m primarily due to non-cash divi-
dend distribution of DKK 750m and loss for
the year of DKK 364m. The non-cash divi-
dend financed TDC Holdings partially re-
payment of the upstream loan that de-
creased to DKK 1,438m including accrued
interests at year-end 2023.
During 2022, total equity decreased by
DKK 6,832m due to dividend distribution
DKK 8,750m offset by profit for the year
DKK 1,918m.
The parent company statement of
changes in equity specifies which reserves
are available for distribution. The distribut-
able reserves amounted to DKK 1,063m at
31 December 2023 before dividend distribu-
tion (2022: DKK 1,046m).
Comments
The group is financed through the European
bond market (EMTN), bilateral term loans and
the market for syndicated senior secured bank
loans (Senior Term Facilities - STF). The group
also has a Revolving Credit Facility to support
its daily liquidity management.
All TDC NET's funding including loan, bond
and liquidity facilities are governed by a com-
mon terms agreement defining financial and
legal covenants. The financial covenant has
not been breached in 2023, and is not ex-
pected to be breached in 2024.
In 2023 we have issued two fixed rate Euro- Derivatives are used for hedging interest
bonds each in benchmark size of EUR 500m and exchange-rate exposure only.
with maturities in respectively 2030 and 2031.
Two bilateral bank facilities have been entered
into during 2023 in a total of EUR 129m.
The group’s term loan facilities have, apart
from one in of size DKK 400m, all been issued in
EUR mainly with floating interest rates. Loans
with floating interest rates were swapped to
fixed interest rates due to the hedge require-
ments set by the Common Terms Agreement
defined along with establishing the new financ-
ing platform.
123/154
4.2 | Loans (continued)
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
2023
2024 2026 2027 2027 2028 2029 2030 2030 2031 Total
Maturity
Feb 2024³
Floating
Margin +
floored
Euribor²
EUR
STF loan
685
5,106
685
Jun 2026
Floating
Margin +
floored
Cibor²
DKK
STF loan
400
400
Feb 2027
Floating
Margin +
floored
Euribor²
EUR
STF loan
75
559
75
Feb 2027
Floating
Margin +
floored
Euribor²
EUR
STF loan
900
6,709
900
May 2028
Fixed
5.056%
EUR
EMTN Bond
500
3,727
500
Jun 2029
Floating
Margin +
floored
Euribor²
EUR
STF loan
100
745
100
Feb 2030
Fixed
5.618%
EUR
EMTN Bond
500
3,727
500
Oct 2030
Fixed
5.870%
EUR
STF loan
110
820
110
Jun 2031
Fixed
6.500%
EUR
EMTN Bond
500
3,727
500
25,520
Fixed/floating rate¹
Coupon
Currency
Type
Nominal value (currency)
Nominal value (DKKm)
– Of which nominal value swapped to or with fixed
interest rate (currency)
1
EMTNs and STF loans are in EUR, apart from one STF loan nominated in DKK. Nominal EUR 1bn is swapped to fixed DKK interest rates and the remaining part is in or swapped to fixed EUR interest rates.
2
STF loans have a 0% Euribor or Cibor floor.
3
In January 2024 EUR 650m of the STF loan maturing in 2024 was extended into 2025 with an option for an extension of +1+1.
EUR exposures are not considered a significant risk due to the fixed EUR/DKK exchange rate policy. NET has hedged nominal EUR 1bn to DKK.
As of 31 December 2023 there were no drawings on Revolving Credit Facilities. That is, undrawn RCFs amount to EUR 350m, maturing February 2027.
124/154
4.2 | Loans (continued)
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
2022
2023
2024
2026
2027
2028
2029
2030
Total
Maturity
Feb 2023
Feb 2024
Jun 2026
Feb 2027
May 2028
Jun 2029
Oct 2030
Fixed/floating rate¹
Fixed
Floating
Floating
Floating
Fixed
Floating
Fixed
Coupon
6.875%
Margin +
floored
Euribor²
Margin +
floored
Euribor²
Margin +
floored
Euribor²
5.056%
Margin +
floored
Euribor²
5.870%
Margin (bps)
-
150
190
150
-
190
-
Currency
GBP
EUR
EUR
EUR
EUR
EUR
EUR
Type
Loan from
TDC Holding
A/S
STF loan
STF loan
STF loan
EMTN Bond
STF loan
STF loan
Nominal value (currency)
426
1,400
50
900
500
50
110
Nominal value (DKKm)
3,583
10,410
372
6,692
3,718
372
818
25,965
1
EMTNs and STF loans are in or swapped to nominal EUR and fixed EUR interest rates.
2
STF loans have a 0% Euribor floor.
EUR exposures are not considered a significant risk due to the fixed EUR/DKK exchange rate policy.
Additionally, the group has entered into EUR 250m notional interest rate swaps to fix the interest rate regarding the upcoming EMTN 2023 refinancing.
As at 31 December 2022 there were no drawings on Revolving Credit Facilities (RCF). That is, undrawn RCFs amount to: the group: EUR 350m, maturing February 2027
125/154
4.2 | Loans (continued)
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Net interest-bearing debt (DKKm) 2023 2022
Loans
Accounting policies
Loans are recognised initially at the proceeds re-
ceived net of transaction expenses incurred. In
subsequent periods, loans are measured at amor-
tised cost so that the difference between the
proceeds and the nominal value is recognised in
the income statement over the term of the loan.
Other financial liabilities are measured at amor-
tised cost.
Loan
from TDC
2023
2022
Financial instruments
On initial recognition, financial derivatives are
recognised in the balance sheet at fair value and
subsequently remeasured at fair value in the bal-
ance sheet and in the income statement. De-
pending on the type of instrument
Reconciliation of loans (DKKm) Holding A/S Loans Total Total
different recognised measurement methods are
applied for derivative financial instruments.
The group does not apply hedge accounting.
Comments
Events after the balance sheet date:
In January 2024 EUR 650m of the STF
loan maturing in 2024 was extended
into 2025 with an option for an exten-
sion of +1+1.
EMTN bonds incl. short-term part
11,083
3,637
Senior term facilities incl. short-term part
14,320
18,638
Loans from TDC Holding A/S
-
3,583
Debt regarding leasing incl. short-term part
1,024
1,332
Spectrum licences fee liabilities
1,685
1,826
Derivatives
4
152
Interest-bearing receivables and investments
(1,438)
(2,114)
Cash
(1,855)
(2,240)
Total
24,823
24,814
Carrying amount at 1 January
3,583
22,275
25,858
12,712
Proceeds from new loans
-
8,359
8,359
25,982
Repayment of loans
(3,599)
(5,323)
(8,922)
(12,633)
Other non-cash movements¹
16
92
108
(203)
Carrying amount at 31 December
-
25,403
25,403
25,858
Recognised as follows in the bal-
ance sheet:
Non-current liabilities
-
20,298
20,298
22,275
Current liabilities
-
5,105
5,105
3,583
Total
-
25,403
25,403
25,858
126/154
4.2 | Loans (continued)
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Net interest-bearing debt (DKKm)
Non-cash changes
Debt from
Currency
At
At 1 January
Acquisition/
new licences
translation
31 December
2023
2023
Cash flow
disposal
and leases
adjustment
Other²
2023
Loans incl. short-term part
25,858
(563)
75
33
25,403
Lease liabilities incl. short-term part
1,332
(301)
183
(190)
1,024
Corrections for derivatives and reversals of fixed fair values on loans due to hedge accounting¹
152
63
(9)
(202)
4
Interest-bearing receivables and payables
-
-
Spectrum licence fee liabilities incl. short-term part
1,826
1,685
Amounts owed by group companies
(2,114)
(1,438)
Cash
(2,240)
(1,855)
Net interest-bearing debt
24,814
24,823
Non-cash changes
2022
At 1 January
2023
Cash flow
Acquisition/
disposal
Debt from
new licences
and leases
Currency
translation
adjustment
Other²
At
31 December
2023
Loans incl. short-term part
12,712
13,349
-
-
(231)
28
25,858
Lease liabilities incl. short-term part
1,313
(277)
-
296
-
-
1,332
Corrections for derivatives and reversals of fixed fair values on loans due to hedge accounting¹
-
181
-
-
274
(303)
152
Interest-bearing receivables and payables
(59)
59
-
-
-
-
-
Spectrum licence fee liabilities incl. short-term part
1,964
1,826
Amounts owed by group companies
-
(2,114)
Cash
(12)
(2,240)
Net interest-bearing debt
15,918
24,814
1 Currency and fair value adjustment effect from derivatives that hedge long-term loans.
2 Includes amortisation of borrowing costs, lease reassessment and fair value adjustments.
127/154
4.3 | Financial risks
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Interest-rate risks
The group is mainly exposed to interest-rate risks
in the euro area, as a majority of the nominal
gross debt is de-nominated in or swapped to EUR
or DKK.
Throughout 2023, the group monitored and man-
aged its interest-rate risks using financial instru-
ments in line with the group’s financial policy
targets.
The interest rate is hedged 5 years on average.
This secure a stable base rate cost. The deriva-
tives are marked to market which implies a short
term risk of losses in valuation if interest rates in
general decreases.
The group is exposed to potential widening of
credit spread in future years. This exposure is un-
hedged.
Exchange-rate risks
The group has limited operational exchange-rate
risks related to payables from equipment suppli-
ers. These risks are monitored and hedged by the
Treasury team.
The group has very limited exchange-rate risk in
relation to its loan portfolio or RCF commitment,
as all are issued in or swapped to EUR or DKK
(EURDKK pegged).
Counterparty risks
The group has limited credit risk as a provider of
mobile network and landline connections in
Denmark, where most of its revenue stems from
large, well-established service providers. The
group handles the counterparty risk emanating
from providing services to these customers, while
the counterparty risks in relation to financial con-
tracts are handled by the Treasury team.
Liquidity risks
As of 31st December 2023, the group holds a
Revolving Credit Facility (RCF) of EUR 350m to
service its daily operations. In addition, the com-
pany also has a Debt Service Reserve (DSR) Li-
quidity Facility Agreement of EUR 155m and an
Operational and Capex Reserve (O&C) Liquidity
Facility Agreement of EUR 75m.
Undrawn credit lines
At year-end 2023, the group had undrawn
committed credit lines totalling EUR 580m
under the SFA. This includes the RCF, DSR and
O&C facilities.
Credit rating
TDC NET holds an external rating by Fitch.
TDC NET
1
company
ratings at 31 Decem-
ber 2023 Fitch
Company Instrument
1
TDC NET Holding are not rated separately, the above rat-
ings are TDC NET ratings (as Issuer ratings ).
Comments
The group handles financial risks specific
to the provision of mobile network and
landline connections. The general re-
sponsibility of identifying, monitoring
and managing these risks in the group is
handled by the Treasury team.
TDC NET
BBB-
BB
128/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
4.4 | Financial income and expenses
(DKKm)
2023 2022
(DKKm)
Net interest
Currency
translation
adjustments
Fair value
adjustments Total
In the group’s internal reporting, currency transla-
tion adjustments and interest from derivatives
are reported as such, as specified in the adjacent
table.
Interest, currency translation adjustments and
fair value adjustments represented an expense of
DKK 1,898m in 2023. The increase of DKK 2,309m
compared with 2022 was driven primarily by a
negative development in fair value adjustments
as well as higher interest expense:
Interest: At year end 2023 the groups Senior
Term Facility loan amounts to EUR 1.87bn and
DKK 0.4bn and the EMTN amounts to EUR 1.5bn.
This resulted in a higher interest due primarily to
the higher level of long-term loans as well as
higher interest rates when compared
to 2022.
Fair value adjustments: The group has hedged its
floating Senior Term Facilities (and future debt is-
suances) from floating interest rates to fixed in-
terest rates (nominal EUR 1.76bns as of 31 De-
cember 2023). In 2022 increasing market interest
rates impacted the period positively. In 2023 the
positive unrealised fair value declined due to de-
creasing market interest rates in
2023 as well as time value, this was partly offset
by an interest saving from the derivatives relating
to the STF.
Currency adjustments: During 2023, the EUR ex-
change rate increased, resulting in unrealised
losses relating to loans denominated in or
swapped to EUR.
Interest income
Interest expenses
91
(1,507)
75
(1,032)
Net interest
(1,416)
(957)
Currency translation adjustments
Fair value adjustments
(60)
(422)
224
1,144
Total
(1,898)
411
2023
Senior Term Facilities (STF) loans
(761)
(39)
(3)
(803)
Euro Medium Term Notes (EMTNs)
(548)
(20)
21
(547)
Hedge of Senior Term Facilities/fu-
ture debt issuance
222
(3)
(674)
(455)
Loans group companies
19
1
-
20
Lease liabilities
(35)
-
-
(35)
Other
(84)
6
-
(78)
Total
(1,187)
(55)
(656)
(1,898)
(DKKm)
Net interest
Currency
translation
adjustments
Fair value
adjustments
Total
2022
Senior Term Facilities (STF) loans
(510)
12
(7)
(505)
Loans group companies
(194)
1
-
(193)
Euro Medium Term Notes (EMTNs)
(108)
2
28
(78)
Hedge of Senior Term Facilities/fu-
ture debt issuance
(162)
-
1,488
1,326
Lease liabilities
(36)
-
-
(36)
Other
(97)
(8)
2
(103)
Total
(1,107)
7
1,511
411
129/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
4.5 | Maturity profiles of financial instruments
2023
Maturity profiles of expected cash flows¹(DKKm) < 1 year 1-3 years 3-5 years > 5 years Total Fair value
Carrying
amount
Maturity profiles
The maturity analyses of financial assets and
liabilities are disclosed by category and class and
are allocated according to maturity period. All
interest payments and repayments of financial
liabilities are based on contractual agreements.
Interest payments on floating-rate instruments
are determined using forward rates.
Financial assets and liabilities measured at fair value through profit or loss
Assets²:
Derivatives
Inflow
Outflow
418 2,268 144 38 2,868
(125) (2,085) (98) (31) (2,339)
Total derivatives assets
293
183
46
7
529
496
496
Liabilities:
Derivatives
Inflow
377
5,894
65
13
6,349
Outflow
(371)
(5,949)
(112)
(19)
(6,451)
Total derivatives liabilities
6
(55)
(47)
(6)
(102)
(120)
(120)
Total derivatives
299
128
(1)
1
427
376
376
Financial liabilities measured at amortised cost
Senior Term Facilities (STF) loan
(5,106)
(400)
(7,268)
(1,565)
(14,339)
(14,380)
(14,319)
Euro Medium Term Notes (EMTNs)
-
-
(3,727)
(7,454)
(11,181)
(11,696)
(11,084)
Total loans
(5,106)
(400)
(10,995)
(9,019)
(25,520)
(26,076)
(25,403)
Spectrum licence liabilities
(271)
(483)
(483)
(642)
(1,879)
(1,685)
(1,685)
Lease liability
(358)
(426)
(136)
(197)
(1,117)
(1,024)
(1,024)
STF and EMTN, interest³
(1,177)
(2,006)
(1,505)
(1,259)
(5,947)
(533)
(533)
Amounts owed to group companies
(124)
-
-
-
(124)
(124)
(124)
Trade and other payables⁴
(956)
-
-
-
(956)
(956)
(956)
Total financial liabilities measured at amortised cost
(7,992)
(3,315)
(13,119)
(11,117)
(35,543)
(30,398)
(29,725)
Total
(7,693)
(3,187)
(13,120)
(11,116)
(35,116)
(30,022)
(29,349)
130/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
4.5 | Maturity profiles of financial instruments (continued)
2022
Carrying
1 All cash flows are undiscounted. The table reflects only the
cash flow from financial liabilities and derivatives recog-
Maturity profiles of expected cash flows¹(DKKm)
< 1 year
1-3 years
3-5 years
> 5 years
Total
Fair value
amount
nised as financial assets. Other cash flow from financial as-
sets is not disclosed.
Financial assets and liabilities measured at fair value through profit or loss
Assets²:
2 Both assets and liabilities measured at fair value through
profit or loss are disclosed in the above table because some
of the derivatives are used for hedging financial liabilities
measured at amortised cost, see table.
do not constitute a financial liability), the amount differs
Derivatives
Inflow
1,244
748
584
106
2,682
3 Fair value and carrying amount value consist of accrued in-
terest on STF loan, EMTNs and loans from TDC Holding A/S
at 31 December.
4 As not all trade and other payables recognised in the bal-
Outflow
(996)
(158)
(180)
(62)
(1,396)
ance sheet are financial instruments (e.g., unbilled payables
Total derivatives assets
248
590
404
44
1,286
1,174
1,174
from the amount disclosed in the balance sheet.
Liabilities:
Derivatives
Inflow
2,984
-
-
-
2,984
Outflow
(3,151)
-
-
-
(3,151)
Total derivatives liabilities
(167)
-
-
-
(167)
(176)
(176)
Total derivatives
81
590
404
44
1,119
998
998
Financial liabilities measured at amortised cost
Senior Term Facilities (STF) loan
-
(10,410)
(7,064)
(1,190)
(18,664)
(18,664)
(18,637)
Euro Medium Term Notes (EMTNs)
-
-
-
(3,718)
(3,718)
(3,668)
(3,638)
Loan from TDC Holding A/S
(3,583)
-
-
-
(3,583)
(3,583)
(3,583)
Total loans
(3,583)
(10,410)
(7,064)
(4,908)
(25,965)
(25,915)
(25,858)
Spectrum licence liabilities
(192)
(513)
(483)
(883)
(2,071)
(1,826)
(1,826)
Lease liability
(292)
(516)
(418)
(226)
(1,452)
(1,332)
(1,332)
STF and EMTN, interest³
(1,017)
(1,314)
(902)
(362)
(3,595)
(209)
(209)
Loan from TDC Holding A/S, interest³
(232)
-
-
-
(232)
(198)
(198)
Amounts owed to group companies
(55)
-
-
-
(55)
(55)
(55)
Trade and other payables⁴
(813)
-
-
-
(813)
(813)
(813)
Total financial liabilities measured at amortised cost
(6,184)
(12,753)
(8,867)
(6,379)
(34,183)
(30,348)
(30,291)
Total
(6,103)
(12,163)
(8,463)
(6,335)
(33,064)
(29,350)
(29,293)
Section 5
Cash flow
This section provides information on TDC NET’s cash
flow. More information on development in the cash
flow items is included in note 2.6 Special items, note
3.1 Intangible assets, note 3.2 Property, plant and
equipment, note 3.6 Provisions as well as note 4.4
Financial income and expenses.
5.1 Change in working capital 132
5.2 Investment in enterprises 132
5.3 Equity free cash flow 132
Annual Report 2023
131/154
5.1 | Change in working capital
5.3 | Equity free cash flow
5.2 | Investment in enterprises
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Accounting policies
Cash flow from operating activities is presented
Cash flow from financing activities comprises
5.2 | Investment in enterprises
using the indirect method and is based on profit
before interest, taxes, depreciation, amortisation
and special items adjusted for non-cash operat-
ing items, cash flow related to special items,
changes in working capital, interest received and
paid as well as income taxes paid.
Cash flow from investing activities comprises
acquisitions and divestments of enterprises, pur-
chases and sales of intangible assets, property,
plant and equipment as well as other non-cur-
rent assets. Cash flow from acquired enterprises
are recognised from the time of acquisition, while
cash flows from enterprises divested are recog-
nised up to the time of divestment.
changes in interest-bearing debt, lease instal-
ments and dividends to shareholders.
Cash and cash equivalents cover cash and
marketable securities with a remaining life not
exceeding three months at the time of acquisi-
tion, and with an insignificant risk of changes in
value.
The cash flow statement cannot be derived
solely from information presented in the
financial statements.
In 2023 no transactions concerning investment in
enterprises has occurred.
In 2022, the group insourced IT- and other activi-
ties from the parent company TDC Holding A/S.
The net cash outflow on the acquisition
amounted to DKK 126m.
The acquisition had no significant impact on
the income statement for 2022.
5.1 | Change in working capital 5.3 | Equity free cash flow
(DKKm)
2023 2022
Change in receivables
(109)
54
Change in contract assets
(12)
(5)
Change in trade payables
(225)
19
Change in contract liabilities
133
(3)
Change in prepaid expenses
11
(1)
Change in other items, net
295
(8)
Total
93
56
(DKKm)
2023 2022
Cash flow from operating activities
3,327
3,195
Cash flow from investing activities
(2,933)
(5,478)
Hereof investment in enterprises
-
126
Hereof loans to TDC Holding
-
2,045
Lease repayments
(301)
(277)
Equity free cash flow
93
(389)
132/154
Section 6
Other
disclosures
This section contains statutory notes or notes
that are presumed to be less important for
understanding the Group’s financial performance.
6.1 Incentive programmes 134
6.2 Related parties 135
6.3 Fees to auditors 136
6.4 Other financial commitments 136
6.5 Pledges and contingencies 137
6.6 Events after the balance sheet date 137
6.7 Overview of group companies
at 31 December 2023 137
Annual Report 2023
133/154
134/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
6.1 | Incentive programmes
To drive both short-term performance and long-
term financial success, the Group offers compre-
hensive incentive programmes for executives and
managers. The remuneration of top management
shall seek to align management incentives with
shareholder value creation including a strong link
to our ambitious ESG leadership targets.
Short-term incentive programmes (STI)
These programmes are intrinsically linked to our
core strategy. They focus on critical performance
measures such as EBITDA, capital expenditures
(capex), efficiency in fibre connection, and the
ability to sustain and grow dividend capacity.
Bonus payments are determined by multiplying
the individual's base salary by a specific bonus
percentage, which is then adjusted according to
the degree of target achievement.
For Executive Committee members, this bonus
percentage typically falls between 25% and 50%.
For other management roles, it ranges from 10%
to 33%. The upper limit for target fulfilment is set
at a robust 200%
Long-Term Incentive programme (LTI)
The LTI is a cash-based incentive aligned with
the long-term strategic objectives of the Group.
This forward-thinking programme issues grants
annually, which are usually subject to a 3-year
vesting schedule to underscore our commitment
to sustained growth and strategic goals. The LTI
is designed to meet targets over a triennial hori-
zon, including improvements in EBITDA, expan-
sion of fibre connectivity to more homes, en-
hancements in health & safety standards, and
solidifying dividend capacity. Recognising these
costs over the vesting period ensures a transpar-
ent and accountable approach to executive re-
muneration. The calculation of LTI bonus pay-
ments mirrors that of the STI, involving the indi-
vidual’s base salary and an LTI percentage, which
is influenced by target achievement levels.
The LTI percentages vary from 12% to 36%, with
the potential for target fulfilment reaching up to
200%.
Together, these incentive programmes are struc-
tured to align the interests of our executives and
managers with those of our shareholders and to
promote a culture of excellence and accountabil-
ity across the Group
Long-Term Incentive programme 2024-2026
In the strategic planning for our LTI programme
for 2024-2026, it has been important for us to in-
clude ESG key performance indicators other than
financial targets, which are fundamental for driv-
ing performance towards our sustainability com-
mitments:
Climate net-zero targets
Health & Safety targets
Diversity targets
Management Incentive Programme (MIP)
In July 2020, the parent company TDC Holding
A/S established a new cash-based incentive pro-
gramme which includes the Executive Committee
and certain key managers of the group. In total
13 managers are participating the MIP pro-
gramme. Under the MIP, the participants are re-
quired to place a deposit to TDC Holding A/S to
qualify for a return. The payback amounts are
based on the development in certain financial
performance measures of the TDC Holding group
as well as certain business and Health & Safety
KPIs over the period until 2023. The investment
programme covers the time period 2019-2023.
The participants have 40% of the deposits at risk
of being lost in downside scenarios and we have
recognised an accrual of 1.21x in payout to the
participants’ deposit.
The group participants’ total deposits amount to
DKK 17m and the expenses for 2023 relating to
the programme amounted to DKK 0m (2022: DKK
14m). At 31 December 2023 the total liabilities re-
lated to the management incentive programme
amounted to DKK 36m (2022: DKK 38m).
135/154
6.2 | Related parties
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Name of related party Nature of relationship Domicile
DKT Holdings ApS Indirect ownership – ultimate parent Copenhagen,
Denmark
DKT Finance ApS Indirect ownership Copenhagen,
Denmark
DK Telekommunikation ApS Indirect ownership Copenhagen,
Denmark
TDC Holding A/S Ownership - parent Copenhagen,
Denmark
Nuuday A/S Subsidiary of TDC Holding A/S Copenhagen,
Denmark
TDC Pensionskasse Pension fund Copenhagen,
Denmark
Related parties (DKKm) 2023 2022
Related parties also include the group’s joint ven-
tures and associates shown in note 6.7.
Remuneration for the Board of Directors and the
Executive Committee is specified in note 2.4.
Loans from the parent company TDC Holding
A/S are specified in note 4.2.
Purchase commitments towards group compa-
nies are shown in note 6.4.
All transactions with related parties are made on
market terms. The most significant related party
is Nuuday A/S, see also note 2.1.
The group has the following additional transac-
tions and outstanding balances with related
parties:
TDC Holding A/S
Income
116
328
Expenses, lease payments and capital expenditure
(479)
(818)
Payables
(631)
(742)
Loans receivables
1,438
2,114
Loans payables
-
(3,583)
Joint ventures and associates
Income
1
1
Expenses
(3)
(4)
Other related parties
Income
5,238
5,397
Expenses and capital expenditure
(21)
(103)
Receivables
1,235
1,008
Payables
(425)
(269)
136/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
6.3 | Fees to auditors 6.4 | Other financial commitments
Fees to auditors elected by the Annual General Meeting (DKKm)
2023
2022
(DKKm)
2023
2022
Statutory audit
2
2
Other assurance engagements
1
2
Tax advisory services
-
-
Other services
-
2
Total non-statutory audit services
1
4
Total
3
6
Comments
Leases
Except for short-term leases and leases of
low-value assets, leases are recognised as a
lease asset and a corresponding liability at
the date at which the leased asset is available
for use by the Group, cf. note 3.4.
Purchase commitments
As part of TDC NET’s commitment to reduce
our emissions with a target of 100% renewable
energy in operations by 2028, TDC NET has
entered into 10 years Power Purchase Agree-
ments (PPA) with Better Energy delivering
electricity from their solar parks.
The PPA is fixed 140 GWh and the solar parks
covered 71% of TDC NET’s electricity con-
sumption in 2023. These agreements are fixed
price agreements. As these agreements are
entered into and will continue to be held for
the purpose of receiving energy for own usage
within TDC NET’s operations, they are recog-
nised as power costs (note 2.3) and other pur-
chase commitments.
Lease commitments for short-term and low-value leases
Short-term leases
Leases of low-value assets
20
1
41
2
Total
21
43
Capital and purchase commitments
from group companies
Investments in intangible assets
11
103
Investments in property, plant and equipment
236
99
Commitments related to outsourcing agreements
4
107
Other purchase commitments
306
27
137/154
6.7 | Overview of group companies
at 31 December 2023
6.5 | Pledges and
contingencies
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
6.6 | Events after the
balance sheet date
Annual Report 2023
Pledges
Receivables from group companies with a carry-
ing amount of DKK 1,438m (2022: DKK 2,114m),
cash with a carrying amount of DKK 1,750m
(2022: DKK 2,164m), receivables DKK 329m (2022:
DKK 321m) and Spectrum Licence with a carrying
amount of DKK 2,288m (2022: DKK 2,436m) are
pledged as security for the long-term loans in
TDC NET A/S.
Contingent assets
In the spring of 2023, TDC NET received a deci-
sion from the Center for Cyber Security (CFCS)
necessitating the discontinuation of our current
Central Transport (DWDM) network supplier by
January 1, 2027. TDC NET will comply with the
security policy decision of the authorities and ad-
heres to CFCS's decision to replace the supplier
for its DWDM network. However, as TDC NET has
assessed this action as an expropriation, this led
TDC NET to initiate legal proceedings. It is Man-
agement's opinion that the matter is fundamen-
tal to protect the company's rights, but the out-
come of the legal proceedings is not virtually cer-
tain, and therefore no asset has been recognised
in the financial position of TDC NET.
Contingent liabilities
The group is party to certain pending lawsuits
and cases pending with public authorities and
complaints boards. Based on a legal assessment
of the possible outcome of each of these lawsuits
and cases, Management is of the opinion that
these will have no significant adverse effect on
the group’s financial position.
The parent is liable for obligations attributable
to the activities, assets and liabilities of
TDC Holding A/S that existed at the demerger
on 11 June 2019. The joint and several liabilities of
TDC NET A/S and TDC Holding A/S respectively
cannot exceed an amount corresponding to the
net value of the assets and liabilities.
In January 2024 EUR 650m of the STF loan
maturing in 2024 was extended into 2025 with
an option for an extension of +1+1
There have been no other events that materially
affect the assessment of this Annual Report 2023
after the balance sheet date and up to today.
6.7 | Overview of group companies
at 31 December 2023
Company name
Domicile
Currency
Ownership share (%)
TDC NET A/S
Copenhagen, Denmark
DKK
100
Dansk Kabel TV A/S
Copenhagen, Denmark
DKK
100
DKTV Anlæg ApS
Vemmelev, Denmark
DKK
100
Fiberkysten A/S
Gilleleje, Denmark
DKK
60
OCH A/S
1
Copenhagen, Denmark
DKK
25
TDC NET Finance B.V.
2
Amsterdam, the Netherlands
EUR
100
1
The enterprise is included under the equity method.
2
TDC Net Finance B.V. was established in connection with the refinancing of the TDC Net Holding group with the purpose of
potentially issuing EUR denominated debt instruments that are eligible for financing at ECB. The company is however currently
without activities and there are no immediate plans for the use of the company. The company will be taxable in Denmark under
the rules of Place of Effective Management and as such part of the Danish joint taxation.
Parent company
financial statements
Annual Report 2023
138/154
139/156
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Income statement Statement of comprehensive income
(DKKm)
Note 2023 2022
(DKKm)
Note 2023 2022
External expenses
-
-
Operating profit (EBIT)
-
-
Profit from subsidiaries
4
(364)
1,918
Financial income from group companies
69
70
Financial expenses from group companies
(69)
(70)
Profit before income taxes
(364)
1,918
Income taxes
3
-
-
Profit/(loss) for the year
(364)
1,918
Profit/(loss) for the year
(364)
1,918
Total comprehensive income
(364)
1,918
140/156
Balance sheet
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Assets (DKKm)
Note
2023
2022
Equity and liabilities (DKKm)
Note
2023
2022
Non-current assets
Investments in subsidiaries
4
1,867
2,964
Equity
Share capital
-
-
Receivables from group companies
1,438
2,114
Other reserves
804
1,918
Total non-current assets
3,305
5,078
Retained earnings
1,063
1,046
Total equity
5
1,867
2,964
Total current assets
-
-
Total assets
3,305
5,078
Non-current liabilities
Loans from group companies
1,438
2,114
Total non-current liabilities
1,438
2,114
Total current liabilities
-
-
Total liabilities
1,438
2,114
Total equity and liabilities
3,305
5,078
141/156
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Statement of cash flows
(DKKm)
Note
2023
2022
Total cash flow from operating activities
-
-
Total cash flow from investing activities
-
-
Total cash flow from financing activities
-
-
Total cash flow
-
-
Cash and cash equivalents at 1 January
-
-
Cash and cash equivalents at 31 December
-
-
142/156
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Statement of changes in equity
(DKKm)
Share capital
Reserve for net
revaluation
under the equity
method
Retained
earnings
Total
Equity at 1 January 2022
Profit for the year
-
-
-
1,918
-
-
1,918
Total comprehensive income
-
1,918
-
1,918
Capital injection of shares in TDC NET Holding A/S
-
-
1,046
1,046
Total transactions with owners
-
-
1,046
1,046
Equity at 31 December 2022
-
1,918
1,046
2,964
Loss for the year
-
(364)
-
(364)
Total comprehensive income
-
(364)
-
(364)
Contribution of equity
-
-
17
17
Distributed dividends
-
(750)
-
(750)
Total transactions with owners
-
(750)
17
(733)
Equity at 31 December 2023
-
804
1,063
1,867
Annual Report 2023
Notes to
parent company
financial
statements
143/154
144/154
3 | Income taxes
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
1 | Accounting policies 2 | New accounting standards
The Financial statements 2023 of the parent com-
pany have been prepared in accordance with IFRS
Accounting Standards as issued by the Interna-
tional Accounting Standards Board (IASB) as
adopted by the European Union (EU) and further
disclosure requirements in the Danish Financial
Statements Act (reporting class “B” with addition
of certain provisions for reporting class C).
The accounting policies are unchanged from last
year.
The parent company accounting policies are the
same as those applied to the Group, with the ad-
ditions mentioned below. See note 1.1 to the con-
solidated financial statements for the Group’s
accounting policies.
Acquisition of TDC NET A/S
As per 3 February 2022 the parent acquired TDC
NET A/S by injection from TDC Holding A/S of
shares in TDC NET A/S. The initial recognition is
accounted for by recognition of the equity-value
in TDC NET A/S using the book value-method.
Supplementary accounting policies for
the parent company
Investments in subsidiaries, joint ventures
and associates
The equity method is used for measuring invest-
ments in subsidiaries, joint ventures and associ-
ates. Under the equity method, investments in
subsidiaries, joint ventures or associates are rec-
ognised on initial recognition at cost, and the
carrying amount is increased or decreased to rec-
ognise the parent company’s share of the profit
or loss of the investment after the date of acqui-
sition. The parent company’s share of profit or
loss is recognised in the parent company’s profit
or loss. Dividends received from investments in
subsidiaries, joint ventures and associates reduce
the carrying amount of the investment. The par-
ent company’s share of other comprehensive in-
come arising from the investment is recognised in
other comprehensive income of the parent com-
pany.
For information on new accounting standards for
the Group, see note 1.3 to the consolidated
financial statements.
3 | Income taxes
The company participates in joint taxation with
the parent company DKT Holdings ApS and all its
Danish subsidiaries. DKT Holdings ApS is the
management company in the joint taxation. The
jointly taxed companies are jointly and severally
liable for the total income taxes, taxes paid on
account and outstanding residual tax (with addi-
tional payments and interest) relating to the
joint taxation.
145/154
6 | Related parties
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
4 | Investments in subsidiaries 5 | Equity
(DKKm)
2023 2022
For information on share capital, see note 4.1 to the consolidated financial statements.
6 | Related parties
Overview of subsidiaries at 31 December 2022
Company name Domicile Currency
Subsidiaries:
Ownership
share (%)
For information about the related parties of the
Group, see note 6.2 to the consolidated financial
statements. The parent company has the follow-
ing transactions and outstanding balances with
its subsidiaries (cf. the overview of subsidiaries in
note 4):
Subsidiaries (DKKm) 2023 2022
Expenses
(74)
(69)
Debt
(1,438)
(2,114)
The loan from TDC NET A/S maturing in 2027
Interest expenses to group companies are shown
in the income statement.
All transactions with related parties are made on
market terms.
The parent is included in the consolidated finan-
cial statements of TDC Holding A/S and of the
ultimate parent company DKT Holdings ApS. The
consolidated financial statements can be down-
loaded from tdcgroup.com.
TDC NET A/S Copenhagen, Denmark DKK 100
(DKK 1,438m) mirrors the receivable from TDC
Holding A/S, matching both the nominal out-
standing amount as well as the interest rate.
Remuneration for the Board of Directors and the
Executive Committee is described in note 2.4 and
incentive programmes in note 6.1 to the consoli-
dated financial statements.
Cost at 1 January
Additions, capital contribution of shares
1,046
17
-
1,046
Cost at 31 December
1,063
1,046
Value adjustments at 1 January
1,918
-
Share of profit/(loss)
(364)
1,918
Dividends
(750)
-
Value adjustments at 31 December
804
1,918
Carrying amount at 31 December
1,867
2,964
146/154
7 | Pledges and
contingencies
8 | Events after the
balance sheet date
7 | Pledges and
contingencies
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
8 | Events after the
balance sheet date
Annual Report 2023
Receivables from group companies with a carry-
ing amount of DKK 1,438m (2022: DKK 2,114m)
and shares in subsidiaries with a carrying amount
of DKK 1,867m (2022: DKK 2,964m) are pledged
as security for the long-term loans in TDC NET
A/S.
For information on pending lawsuits, see note 6.5
to the consolidated financial statements.
For information on events after the balance
sheet date, see note 6.6 to the consolidated fi-
nancial statements.
148/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Executive Committee
Board of Directors
149/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Independent auditor’s report
150/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
CVR No. 33 963556
Identification No (MNE) m ne322 08
Identification No (MNE) mne233 47
151/154
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Independent Auditor’s Assurance Report
on the ESG statement
To stakeholders of TDC NET
Holding A/S
TDC NET Holding A/S engaged us to provide lim-
ited assurance on the consolidated ESG perfor-
mance data, presented in the ESG statements on
pages 71 to 76 as well as the Achieved Emissions
KPIs and adjusted 2020 baseline for Scope 1 and
2 and for Scope 3, presented in the Sustainability
Performance Report on page 35 in the Annual
Report 2023 for the period 1 January - 31 Decem-
ber 2023 (hereinafter referred to as ‘the ESG
statement’).
Management’s responsibility
Management of TDC NET Holding A/S is respon-
sible for designing, implementing and maintaining
internal controls over information relevant to the
preparation of the ESG data and information in
the ESG statement, ensuring it is free from mate-
rial misstatement, whether due to fraud or error.
Furthermore, Management is responsible for es-
tablishing objective accounting policies for the
preparation of the ESG statement, for the overall
content of the ESG statement, and for measuring
and reporting ESG data in accordance with the
ESG accounting principles included on pages 82-
87 in the Annual Report 2023.
Auditor’s responsibility
Our responsibility is to express a limited assur-
ance conclusion based on our engagement with
Management and in accordance with the agreed
scope of work. We have conducted our work in
accordance with ISAE 3000 (Revised) Assurance
Engagements Other than Audits or Reviews of
Historical Financial Information and ISAE 3410
Assurance Engagements on Greenhouse Gas
Statements, and additional requirements under
Danish audit regulation, to obtain limited assur-
ance about our conclusion. Greenhouse Gas emis-
sions quantification is subject to inherent uncer-
tainty because of incomplete scientific
knowledge used to determine emission factors
and the values needed to combine emissions of
different gasses.
We are responsible for:
• planning and performing the engagement to
obtain limited assurance about whether the
ESG statement is free from material misstate-
ment, whether due to fraud or error, and pre-
pared, in all material respects, in accordance
with the ESG accounting principles;
• forming an independent conclusion, based on
the procedures we performed and the evidence
we obtained; and
• reporting our conclusion to the stakeholders of
TDC NET Holding A/S.
Deloitte Statsautoriseret Revisionspartnerselskab
applies International Standard on Quality Man-
agement 1 (ISQM 1), which requires the firm to
design, implement and operate a system of qual-
ity management including policies or procedures
regarding compliance with ethical requirements,
professional standards and applicable legal and
regulatory requirements. We have complied with
the requirements for independence and other
ethical requirements of the International Ethics
Standards Board for Accountants’ International
Code of Ethics for Professional Accountants
(IESBA Code), which is founded on fundamental
principles of integrity, objectivity, professional
competence and due care, confidentiality and
professional behavior and ethical requirements
applicable in Denmark.
A limited assurance engagement is substantially
less in scope than a reasonable assurance en-
gagement. Consequently, the level of assurance
obtained in a limited assurance engagement is
substantially lower than the assurance that
would have been obtained had we performed a
reasonable assurance engagement.
Work performed
We are required to plan and perform our work in
order to consider the risk of material misstate-
ment in the ESG statement. To do so, we have:
• conducted interviews with data owners and in-
ternal stakeholders to understand the key pro-
cesses and control activities for measuring, re-
cording and reporting the ESG data;
• reviewed evidence on a selective basis to check
that data has been appropriately measured,
recorded, collated and reported;
• performed analysis of data, selected based on
risk and materiality;
• made inquiries regarding significant develop-
ments in the reported data;
• considered the presentation and disclosure of
the ESG statement;
• assessed that the process for reporting green-
house gas emissions data follows the principles
of relevance, completeness, consistency, trans-
parency and accuracy outlined in The Green-
house Gas Protocol Corporate Standard Re-
vised edition (2015); and
• evaluated the evidence obtained.
152/154
Our conclusion
Based on the procedures performed and the evi-
dence obtained, nothing has come to our atten-
tion that causes us not to believe that the ESG
statement, including 2020 baseline and Achieved
Emissions KPIs, presented on pages 71 to 76 and
page 35, respectively for the period 1 January -
31 December 2023, have been prepared, in all
material respects, in accordance with the ESG
accounting principles.
Copenhagen, 7 March 2024
Deloitte
Statsautoriseret Revisionspartnerselskab
Business Registration No. 33 96 35 56
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements
Annual Report 2023
Lars Siggaard Hansen Mads Stærdahl Rosenfeldt
State Authorised Public Accountant
Mne32208
ESG Partner
2023 in brief Our business Financial results Sustainability results Governance ESG statements Financial statements Annual Report 2023
Forward-looking statements
Forward-looking statements
This report may include statements about the group’s expectations, beliefs, plans, objectives, assumptions or future events or performance that are not historical facts and ma y be forward-looking. These statements are
often, but not always, formulated using words or phrases such as “are likely to result”, “are expected to”, “will continue”, “believe”, “is anticipated”, “estimated”, “intends”, “expects”, “plans”, “seeks”, “projection” and “outlook”
or similar expressions or negatives thereof. These statements involve known and unknown risks, estimates, assumptions and uncertainties that could cause actual results, performance or achievements or industry results to
differ materially from those expressed or implied by such forward-looking statements.
Any forward-looking statements are qualified in their entirety by reference to the factors discussed throughout this financial report. Key factors that may have a direct bearing on the group’s results include: the competitive
environment and the industry in which the group operates; contractual obligations in the group’s financing arrangements; developments in competition within the domestic and international communications industry;
information technology and operational risks, including the group’s responses to change and new technologies; introduction of and demand for new services and products; developments in demand, produ ct mix and prices in
the mobile and multimedia services market; research regarding the impact of mobile phones on health; changes in applicable legislation, including but not limited to tax and telecommunications legislation and anti-terror
measures; decisions made by the Danish Business Authority; the possibility of being awarded licences; increased interest rate s; the status of important intellectual property rights; exchange-rate fluctuations; global and local
economic conditions; investments in and divestment of domestic and foreign companies; and supplier relationships.
As the risk factors referred to in this report could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements made in this Report, undue reliance is not to be placed on any
of these forward-looking statements. New factors will emerge in the future that the group cannot predict. In addition, the group cannot assess the impact of each factor on its business or the extent to which any factor, or
combination of factors, may cause actual results to differ materially from those described in any forward-looking statements.
153/154
