Deutsche Telekom tops FY forecasts, sees further growth in 2020

News General Germany 19 FEB 2020
Deutsche Telekom tops FY forecasts, sees further growth in 2020

Deutsche Telekom reported results for 2019 ahead of expectations and forecast further growth in 2020. Annual revenues increased 6.4 percent to EUR 80.5 billion, and adjusted EBITDA after leases improved 7.2 percent to EUR 24.7 billion, led by growth at T-Mobile US. Adjusted net profit rose 8.9 percent to EUR 4.9 billion, and free cash flow was up 15.9 percent to EUR 7.0 billion.

For 2020, the German operator forecast revenue growth and adjusted EBITDA up around 3 percent to EUR 25.5 billion, including EUR 13.9 billion outside the US. All segments are expected to contribute to growth, the same as in 2019. Free cash flow is estimated to increase to EUR 8.0 billion. 

Cash capex, before spectrum investments, also was higher than forecast in 2019, at EUR 13.1 billion, a 7.6 percent increase over 2018. The increase was due to the accelerated 5G build-out in the US, the company said. Spending is expected down slightly to EUR 13.0 billion in 2020, with the US stable at EUR 7.8 billion. 

The operator also grew to 3.3 million fibre homes passed in Europe, completed its FTTC build in Germany and expanded to 28 million premises with supervectoring at up to 250 Mbps. The all-IP migration was completed in the consumer market in Germany and is expected finished in the B2B segment by end-2020. In the rest of Europe, 91 percent of lines were moved to IP, up 9 percent points over the year. 

Nearly 10 mln FMC customers

In terms of customers, the group ended the year with 9.6 million Magenta Eins subscribers taking both fixed and mobile services, up by 2 million from 2018. Mobile postpaid subscribers increased by 2.4 million in Europe to 58.0 million at year-end, and the US business grew by a total 6.4 million customers to 86.0 million.

In the fourth quarter of 2019, the company's growth strengthened, with revenues up 5.4 percent to EUR 21.4 billion and adjusted EBITDA growing 8.2 percent to EUR 6.0 billion. Revenue growth reached 1.0 percent in Germany, 7.7 percent in the US, 3.0 percent in the rest of Europe and 0.2 percent at Systems Solutions. On an organic basis, adjusted EBITDA after leases rose 16.8 percent at Systems Solutions, 4.7 percent in the US, 3.1 percent in Europe and 2.4 percent in Germany. 

Telekom confirmed the dividend will be reduced to EUR 0.60 per share from EUR 0.70 for 2018. It aims to pay at least the same for this year. 

Categories:

General

Companies:

Deutsche Telekom,  T-Mobile US

Regions:

Europe

Countries:

Germany,  United States

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Financial figures

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