Deutsche Telekom posts first quarter results

8 May 2008

German incumbent Deutsche Telekom (DT) has released its results for the three months ended 31 March 2008. Adjusted EBITDA came in at EUR4.7 billion (USD7.2 billion), virtually unchanged from the first quarter of 2007, while adjusted net profit rose by 33.2% year-on-year, totalling EUR750 million in 1Q 2008 compared to EUR563 million a year earlier. The company claimed the improved profit was due to ‘enhanced efficiency, improved process and reduced costs’ as well as the deconsolidation of Spanish ISP Ya.com and French operation Club Internet. DT’s net revenues were just under EUR15 billion, in the first three months of 2008, down 3.1% compared to the year-earlier figure of EUR15.5 billion, following reduced sales in the group’s broadband/fixed network and business segments. This is despite DT accounting for 43% of all growth in the German broadband arena, and the addition of 593,000 new DSL customers in the quarter, taking its total to just shy of 13 million. The proportion of net revenue generated outside Germany increased slightly to 51.6%; its foreign position was strengthened by the consolidation of Orange Nederland and US-based SunCom, gaining around 3.4 million mobile customers via the two acquisitions. Overall, DT’s worldwide mobile customer base was 123 million at 31 March 2008, up by 13.9 million year-on-year. At EUR1.6 billion, free cash flow in the first quarter of 2008 increased by EUR1.1 billion year-on-year.

The operator forecasts adjusted EBITDA of EUR13.9 billion and free cash flow of EUR6.6 billion for the full year 2008, and remains committed to paying attractive dividends to shareholders.

Germany, Deutsche Telekom (DT)