2023 in Review

Complete Information in the 2023 Management Report

The results we are announcing today are confirmation of the bold strategic choices we made to accelerate investment in technological leadership, customer experience and digital transformation.

NOS today is a stronger, faster, and more flexible company, with a highly talented and experienced team and a unique combination of core assets, which together enable us to grow ahead of our peers and deliver superior returns.

With the most intense years of 5G investments now behind us, we are on a solid trajectory of free cash flow generation which, allied with the strength of our balance sheet, are supportive of sustained attractive shareholder returns.”
Miguel Almeida, CEO

NOS in Numbers

Financial

Consolidated Revenues​

1,597.5 M€ 1,521.0 M€

Underlying FCF1


148.5 M€ 29.2 M€
2023 2022

EBITDA AL


603.2 M€ 547.7 M€

EBITDA AL – Capex


215.6 M€ 51.8 M€

Ordinary dividend yield2


10.6 % 6.6 %

1) Free-Cash-Flow excluding cash in Cellnex recorded in 2022 (163.8 M€) & VAT payments related to the transaction recorded in 2023 (18 M€)
2) Based on results announcement date closing price

Operating

94%

Territory with outdoor coverage

74%

Fixed network coverage with FttH

2023 – Total RGUs

Mobile 5,916.8 Others & data 53.6 Pay-TV 1,669.9 Fixed Voice 1,821.7 Broadband 1,551.9 11,014.0 k
Human Capital

1,835

Total Employees


1,075

Men

760

Women

42,5

Employee Average Age

33.0%

Women in management and top management positions

<<<<<<< HEAD ======= >>>>>>> 17412f1 (feat: AB#24473 – nos em números capital human) Lisbon 67.7% Porto 27.2% Others 5.1%
Environment

528k

Customer equipment refurbished for reuse

29%

Renewable Electricity

-13%

Energy consumption per Data Traffic

99%

Waste recovery Rate

NOS in Numbers

Financial
2023 2022

Consolidated Revenues

1,597.5 M€ 1,521.0 M€​

EBITDA AL – Capex


215.6 M€ 51.8 M€

EBITDA AL


603.2 M€ 547.7 M€
Financial
2023 2022

Ordinary dividend yield2


10.6 % 6.6 %

Underlying FCF1


148.5 M€ 29 M€

1) Free-Cash-Flow excluding cash in Cellnex recorded in 2022 (163.8 M€) & VAT payments related to the transaction recorded in 2023 (18 M€)
2) Based on results announcement date closing price

Operating

94%

Territory with outdoor coverage

74%

Fixed network coverage with FttH

Operating

2023 – Total RGU's

Mobile 5,916.8 Others & data 53.6 Pay-TV 1,669.9 Fixed Voice 1,821.7 Broadband 1,551.9 11.014,0 k
Human Capital

1,835

Total Employees


1,075

Men

760

Women

42,5

Average Age

33.0%

Women in management and top management positions

Human Capital
67.7% Lisbon 27.2% Porto 5.1% Others
Environment

528k

Customer equipment refurbished for reuse

99%

Waste recovery Rate

Environment

29%

Renewable Electricity

-13%

Energy consumption per Data Traffic

Progress of the NOS Strategy

01

5G Leadership

We provide premier connectivity, boasting the nation’s fastest 5G network. We stand as the leading mobile network in Portugal.

In 2023, NOS continued to invest and work towards having the best 5G network and offering the best connectivity, leveraging the digitalisation of the economy, healthcare, education and society to prepare the country for the future.

02

Digital Emancipation

Accelerate in a sustainable and structural way the use of digital channels in customer interaction.

In 2023, NOS reinforced the quality of its digital ecosystem and improved the customer engagement experience with new features. The digitalisation of internal processes was also intensified.

03

Competitive Offering

Ensuring a products & services offering adjusted to current and future orientated market needs.

The ongoing strategic bet on improving the offering and technological infrastructure and the provision of innovative and competitive solution packs for private and business customers, which are customised to their needs, has allowed NOS to grow its customer base in all segments of the telecommunications business.

04

Close relationship

Deepen customer relationships, focusing on a closer and more personalized management.

NOS brand awareness campaigns reinforce the market’s perception of NOS products & services’ performance and excellence and are one of the main vehicles for strengthening customer relations. The NOS brand is one of the group’s main assets and is widely known and increasingly recognised in the Portuguese market.

05

Value Creation

Ensuring the creation of additional value through business processes and leveraging telco adjacent businesses.

In 2023, NOS continued along the path of improving the value proposition provided by the new telco adjacent and complementary business lines. It thus manages to maximise the return on the strong investment it has made in networks and infrastructure, with innovative proposals that capitalise on existing assets and benefit the market.

06

Focus on people

Prepare and train the organisation for current and future challenges, maintaining NOS as a benchmark in sustainability and in valuing its employees.

The experiencing of values and behaviours was strengthened, guaranteeing high levels of engagement and the consolidation of NOS as an organisation aligned around a common purpose which values: (I) talent and its future development with focus on the skills of the future (II) the well being of employees and their autonomy based on continuous feedback, and (III) the commitment to society.

On behalf of the Planet For a Digital Future More for Our People Ethical & Responsible Management

Progress of NOS Sustainability Strategy

In 2023, we reinforced the energy efficiency program in all areas of the company, achieving a 4% reduction in the energy consumption of our operation. In the mobile access network, the deployment of intelligent power management features (Power Saving Features) in 5G sites reached more than 80% of facilities.

The first stage of the project to optimise the air conditioning of technical rooms in the fixed and mobile network was also completed, with a general improvement in the efficiency indicators of the more than 60 facilities covered. The fleet electrification program also continued, with a total of 24% of vehicles being electric by the end of the year and preparations for a significant increase in 2024. The energy consumption indicator for the telecommunications service per data traffic decreased by 13%, to 53% below the 2019 figure and putting us on a path to meeting the strategic target.
In 2023, due to energy market conditions, it was not possible to procure and cancel Guarantees of Origin and the renewable percentage of our total electricity consumption decreased to 29%.

Four solar micro-generation units have been installed in technical rooms on the fixed network, which will allow the assessment of the potential for renewable self-production in this type of facility.

We have reassessed the timing of the implementation of our strategic target for renewable electricity, ensuring it remains in line with best practice and within the timeframe of our emissions reduction target (2030). To consolidate a structural and sustainable increase in the use of renewable electricity in our operation, we are exploring different market options and contractual models, both for purchase and for self-production.
Due to the reduction in renewable electricity consumption, there was an increase in Scope 2 emissions. Total emissions from our own operation (scope 1 and 2) were 4% higher compared to the base year (2019).

We continued to implement the fleet electrification plan and are defining a new strategy for the procurement of renewable electricity, with the aim of bringing our scope 1 and 2 emissions back in line with the SBT reduction for 2030.
In 2023, we improved the accounting methodology for emissions from the value chain (scope 3) and recalculated the respective figures from the base year of our Science-Based Target (2019), to ensure comparability.

Total Scope 3 emissions decreased in 2023 to 39 % below the 2019 figure. The completion of the investment cycle in the renovation of the mobile and fixed networks, the use of refurbished customer equipment and improved carbon performance in the production of new equipment contributed to the reduction of upstream emissions. Improved energy efficiency and greater use of the energy-saving features of customer equipment contributed to the reduction of downstream emissions.
We continued to expand the portfolio of products & services that reduce customer emissions, with a set of new solutions that capitalise on the additional features of 5G technology and significantly reinforce the environmental benefits induced. In 2023, these solutions accounted for 11% of turnover in the business customer segment and 2% of consolidated turnover.
In 2023, our operation generated 9% less waste compared to the previous year and the overall recovery rate increased to 99,6%.

In 2023, more than 27,000 components were resold for reuse in other networks, avoiding the consumption of new materials and energy. In the logistics operation, we used 89% recycled materials and, as a result of the measures introduced since the beginning of 2022, we have reduced material consumption by 34 tonnes per year and replaced 61 tonnes per year with recycled versions.

The level of digitalisation of billing processes reached 83% for customers and 71% for suppliers and 47% of cinema tickets were sold through digital channels.

We refurbished 528,000 customer devices in the fixed segment for reuse and 54% of the boxes and routers installed during the year were refurbished devices. We have set new targets for the take-back, reuse and recycling of used mobile phones.
In 2023, NOS continued to expand the 5G network and, concurrently, the 4G network continues to have a significant importance in mobile communications, with almost the entire country covered by this technology, maintaining a crucial role while the 5G network is being developed.

The quality and scope of the network provided makes it possible to use applications that benefit personal and business communications, reflected in another year of wide recognition.

In 2023, the NOS network demonstrated its resilience during World Youth Day in Lisbon, resulting from continuous work centred on improving the network’s physical layout, service platforms and energy performance.
In 2023, in the area of inclusion and digital literacy for young people and vulnerable groups, and inclusion through training, NOS reinforced its investment in the “ZER01 Entra na Logica da Computação Project” initiative, increasing its scope and prioritising intervention in geographically decentralised areas with greater socio-economic challenges.

In addition to this project, NOS’s social action involves various aspects of support for the third sector, and therefore support for young people and other vulnerable sections of society. The support is focussed on access to technology, namely on strengthening the communication infrastructures for this type of organisation, and on inclusion through training.

In 2023, a partnership was developed to provide a sign language video interpreter for customers with hearing disabilities, promoting accessibility to products & services.

The main developments in the security & privacy area were related to a more procedural perspective and internal awareness, with the development of the new “S&P by Design 2.0” framework, with the respective new support tools and training actions.
In 2023, NOS continued to innovate in environmentally beneficial solutions for the consumer segment, with new solutions and greater coverage of some existing solutions.

NOS also continued to innovate in solutions for the sustainable transformation of companies and territories:

  • Associating its 5G technology with new remote support initiatives in the healthcare sector.
  • Continuing its smart cities projects, highlighting smart irrigation projects, and 5G-based smart cities.
  • With the conclusion of RD&I projects that it led and participated in, which allowed disruptive solutions to be developed and tested in the area of energy and carbon efficiency in different contexts.
In 2023, we continued on the path of increasing the total number of training hours, a new performance and development model was also launched, and the young talent program – NOS Alfa – obtained an almost maximum score.

These and other dynamics which have been implemented have resulted in a positive trend of recognition among employees, with an increase in various relevant indexes such as the “NOS recommendation index as a great company to work for”, the “Learning and development index” and the general employee satisfaction rate.

In 2023, NOS continued to be involved with a comprehensive set of initiatives aimed at helping to promote a structural change in the interest of young women in technological areas and created a 100% team dedicated to this topic. Despite the efforts made, the number of women in management positions (managers or directors) remained with a slight positive adjustment of 0.2 p.p.

The promotion of inclusion was also an area of focus, with the signing of the “Commitment to Inclusion”.

2023 was a year of consolidation for the new benefits, health and well-being program launched in 2022, the NOS VITA Program, with the extension of benefits to family members and friends of employees, the strategic bet on improving the benefits associated services, and a stronger focus on mental health and emotional balance.

The Personal Protective Equipment (PPE) and Collective Protective Equipment (CPE) Management Procedure started in 2021 was continued, with a strong focus on procedural systematization.

In 2023, NOS continued to honour the commitments of the various codes and policies, supported by a governance model which incorporates ESG and is aligned with good practices in terms of structure, evaluation, independence, and diversity.

In 2023, 91% of employees said they were proud of NOS ethical conduct.
In 2023, we highlight the launch of the first risk supplier evaluation campaign as part of the ESG, Safety and Privacy Supplier Performance Evaluation System, a new, more proactive model for promoting ESG alignment and social and environmental assessment of the supply chain.

The environmental evaluation of suppliers promotes the reduction of environmental impact and the establishment of a value chain that contributes to this commitment.

Downloads

Annual Integrated Report​

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Financial Statements

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Corporate Governance Report

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2023 in Review

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Excel Spreadsheet

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