Deutsche Telekom has followed France Télécom and Vivendi Universal in reporting record corporate losses for 2002 after substantially writing down the value of investments made at the height of the telecoms boom. The German operator reported total revenues for the year of EUR53.7 billion, a rise of more than 11% on 2001, and EBITDA of EUR16.3 billion, up from EUR15.1 billion. However, following the write-downs and a number of exceptional charges, net losses rose from EUR3.45 billion to EUR24.6 billion, marking the biggest loss in European corporate history, ahead of those reported last week by France Télécom (EUR20.7 billion) and Vivendi Universal (EUR23.3 billion).
On a more positive note, Deutsche Telekom said EBITDA for the last three months of 2002 reached EUR4.4 billion, a rise of almost 15% on the corresponding period of 2001, whilst net losses for the quarter stood at EUR100 million, down from EUR2.5 billion. The company’s mobile subsidiary T-Mobile International drove fourth quarter growth, posting EBITDA of EUR1.2 billion for the period, up almost a quarter from 2001. T-Mobile added 2.7 million customers in 2002 to take its global total to 53.9 million. Outside of Germany T-Mobile International has wholly owned subsidiaries in Austria, the Czech Republic and the UK, as well as sizeable stakes in cellcos in the Netherlands, Russia and Poland. T-Mobile USA, the unit formerly known as VoiceStream Wireless, added more than 1 million subscribers in the fourth quarter – more than any other US rival – to end the year with 9.9 million customers.
During 2002 Deutsche Telekom cut its debt pile from EUR64 billion to EUR61.1 billion after selling shares in its internet unit, T-Online International, and has told shareholders it will reduce the figure to around EUR50 billion by the end of 2003 by reducing investments and selling a number of other non-core assets. Chief Executive Officer Kai-Uwe Ricke, who took over from former boss Ron Sommer in November 2002, is also committed to trimming around 50,000 from Deutsche Telekom’s workforce of 250,000. Most of the jobs are associated with companies and third-generation (3G) mobile licences acquired during the operator’s EUR90 billion spending spree under the stewardship of Sommer.
Deutsche Telekom’s shares rose by around 2% during the first hour of trading this morning on the Frankfurt stock exchange, helping to offset some of the 10% decline experienced since the company’s mid-February sale of EUR2.3 billion worth of bonds.