Eltel signs a three-year frame agreement with Telenor

Eltel announced on Thursday that it had signed a three-year (2025-2027) telecom frame agreement with Telenor in Norway. It is a continuation of an existing agreement with Telenor. The agreement covers field services in a frame agreement with an estimated value of 90-180 MEUR during the three years. The frame agreement is based on a model where Eltel is responsible for a contracted volume of design, planning, service deliveries, installations and maintenance, for given geographical areas. With the new agreement, Eltel continues to be one of Telenor’s main suppliers in Norway.

Spread roughly evenly on an annual basis, the agreement is relatively small for Eltel (2024e revenue 833 MEUR, 4-7% of group’s sales). On the other hand, it is significant for Norway’s country unit (2023 revenue 130 MEUR). Furthermore, the continuation agreement with Telenor is a positive sign, since it is one of Eltel’s two largest customers. However, the recently signed continuation agreement, in terms of estimated value, is quite clearly lower than the previous one (cf. the estimated order value for 2024 exercised option year is 70-90 MEUR). At the same time, it is good to notice that there could be significant fluctuations between the years within the frame agreement’s order values as they are typically not binding (an increase in the value is also possible).

Given the background (continuation agreement), the frame agreement has no direct effects on our forecasts or view of the company. The initiation of coverage, where we have taken a more extensive look at the company, can be read here.