Deutsche Telekom has again raised its full-year guidance and promised a higher dividend for 2021, of EUR 0.64 per share versus EUR 0.60 a year ago. Following strong results in the US, Germany and the rest of Europe, the company expects an EBITDA al result of around EUR 38 billion this year, compared to a previous estimate of EUR 37.2 billion, and the forecast for free cash flow AL increases to around EUR 8.5 billion from at least EUR 8.0 billion.
In the first nine months of 2021, the operator reported adjusted EBITDA al up 8.7 percent year-on-year to EUR 28.3 billion. With the new forecast, DT is expecting an around 8.5 percent rise in the annual profit, from EUR 35 billion in 2020.
In the third quarter, net revenue grew by 1.8 percent to EUR 26.9 billion. In Germany, revenue was up 2.5 percent to EUR 6.0 billion, and the rest of Europe grew by 0.9 percent to EUR 2.9 billion, supported by a recovery in mobile roaming and continued growth in broadband. Revenue grew a slower 1.4 percent to EUR 16.8 billion in the US, impacted by exchange rates, and adjusted EBITDA al was down at T-Mobile US by 3.7 percent to EUR 5.8 billion due to lower equipment leasing. This led to a 0.3 percent fall in group EBITDA al to EUR 9.7 billion in Q3.
Deutsche Telekom said that quarterly revenues were up 2.1 percent on an organic basis, excluding changes in forex and scope, and adjusted EBITDA AL was 6.7 percent higher when also excluding the hardware leasing effects in the US.
The higher full-year forecast is largely driven by synergies in the US from the takeover of Sprint. The company also reported improved results at T-Systems, with revenue up 1.0 percent to EUR 1.0 billion and EBITDA al rising 3.9 percent to EUR 80 million. Orders at the IT division increased 15.1 percent from the weak prior-year period to EUR 0.8 billion.
Deutsche Telekom's net profit rose 8.8 percent to EUR 889 million in Q3. Cash capex declined 2.0 percent to EUR 4.7 billion, helping free cash flow jump 79.9 percent to EUR 2.9 billion.
Deutsche Telekom plans to propose a dividend of EUR 0.64 per share for the 2021 financial year, subject to the approval of the supervisory board. Telekom paid out a dividend of EUR 0.60 per share for 2020. The dividend should be based on the adjusted earnings per share. This value should increase from EUR 1.20 in the 2020 financial year to more than EUR 1.75.
Shareholders will receive a dividend of 40 to 60 percent of earnings per share. The lower limit for the dividend is EUR 0.60 per share. Telekom raised the minimum dividend to this value in November 2019. The planned total distribution for 2021 is therefore around EUR 3.19 billion, compared with EUR 2.85 billion in 2020.
