Deutsche Telekom reports 4.1% sales growth

10 May 2007

German incumbent Deutsche Telekom (DT) has reported its results for 1Q2007. Revenue grew 4.1% compared to 1Q2006 to EUR15.5 billion (USD21 billion) driven by strong growth from its international operations. At EUR7.7 billion, international revenue was 15.5% higher than in the same quarter of 2006. DT now generates roughly half of its revenue outside Germany. Domestic revenues fell by 5.1% year-on-year to EUR 7.8 billion due to sustained competitive pressure and regulatory constraints. Broadband and fixed line EBITDA fell by 17.9% year-on-year, while mobile EBITDA by 11.4%. Group EBITDA dropped by 5.8% to EUR4.7 billion in the first quarter. Net profit dropped by 57.9% from EUR1.09 billion in the first quarter of 2006 to EUR459 million in the first quarter of this year. For the 2007 financial year, Deutsche Telekom expects moderate growth in net revenue and adjusted EBITDA of around EUR19 billion.

DT’s total fixed lines fell by 5.8% to 38.3 million on 31 March 2007 compared to 40.6 million on 31 March 2006. 32.6 million of these were in Germany (down 6.1%), 5.69 million in Eastern Europe (down 3.5%) and 3.16 million were dial-up internet subscribers (down 22.7%). The number of broadband customers grew by 35.7% to 12.73 million on 31 March of which 11.06 million were in Germany, growing 29.3%. T-Mobile International had 109.2 million customers on 31 March 2007, 10.1% more than the 99.19 million recorded on 31 March 2006. The number of European mobile customers increased by 8.8% to 83.16 million, while T-Mobile USA saw its customer base reach 26.02 million on 31 March 2007.

Germany, Deutsche Telekom (DT), T-Mobile US