Deutsche Telekom’s (DT) consolidated net profit in the third quarter increased by EUR639 million (USD827 million) to EUR895 million compared with the same period last year. Net income adjusted for special factors increased by 12% year-on-year to EUR1.18 billion in the three months ended 30 September 2008, whilst the German group’s quarterly adjusted EBITDA increased 2.4% year-on-year to EUR5.3 billion. Enhanced efficiency, improved processes and reduced costs in particular had a positive impact on EBITDA, according to a statement in which the company also said that the worsening financial market crisis had not yet had an impact on the development of operations. At EUR4.9 billion, reported EBITDA was down 0.5% on the previous year. Reported consolidated revenue declined by 1.5% y-o-y in 3Q to EUR15.5 billion. On an organic basis, i.e. adjusted for exchange rate effects and excluding changes in the composition of the group, revenue decreased by 0.9%. DT stuck with earlier forecasts of adjusted EBITDA of approximately EUR19.3 billion for full-year 2008.
DT’s results consolidate its mobile operations under the T-Mobile International umbrella. Net revenues from mobile operations in Q3 2008 were EUR8.85 billion, up by 1.8% from EUR8.69 billion in the same quarter of 2007, while net profit came to EUR1.69 billion, a 24.6% rise from the year-ago figure of EUR1.35 billion. The group flagged up growth in its US operations, where T-Mobile USA had 32.14 million customers at the end of September, representing an increase of 4.4 million users in a year, including new subscribers from the recent acquisition of US and Puerto Rican operator SunCom.
At the group’s Broadband/Fixed Network division, total (gross) revenue for the third quarter fell by 5.5% year-on-year to EUR5.31 billion, including a 5.9% drop in domestic gross turnover to EUR4.71 billion and a 1.9% fall in international gross sales to EUR620 million. Quarterly net profit for the division was down 1.8% at EUR930 million. In Germany, falling revenues from traditional PSTN voice services are being partially offset by growth in broadband services. According to the company’s statement, its T Home brand reinforced its strong position in the DSL market, claiming a 49% share of all DSL net subscriber additions in the country in the third quarter, which was the highest level reported by the company since the launch of its resale DSL offer in 2004. Of the 344,000 new DSL customers, around 50,000 were customers returning from competitors. This brings the total of DSL customers won back from resale providers and other network operators to around 150,000 since the beginning of the year. Telekom’s IPTV service, Entertain, now has around 333,000 customers – an increase of 33% in July-September 2008. The number of fixed line losses for the full year is forecast at 2.5 to three million. This includes losses due to regulatory measures as well as on technical grounds as a result of the migration of DSL resale customers to ‘All-IP’. At 1.8 million in the first nine months of 2008, the number of line losses was at the lower end of this guidance, with 574,000 losses in the third quarter.
As previously agreed, this week the government of Greece transferred a 3% stake in the country’s incumbent telco OTE to DT, bringing the German operator’s participation in OTE to 25% (equal to the Greek state’s ownership). Telekom paid a total of EUR3.2 billion for its OTE shares while the price of EUR29 per share implies an approximately 40% premium on the share price when the deal was agreed in May 2008. Greece has also indicated it may sell up to a further 15% to the German firm in the medium term.