Deutsche Telekom's net profit drops 27.3%

News General Europe 6 MAY 2011
Deutsche Telekom's net profit drops 27.3%

Deutsche Telekom's revenues for the first quarter declined by 3 percent year-on-year to EUR 14.597 billion. Revenues for the first quarter of 2010 were adjusted the deconsolidation of T-Mobile UK. At the same time, revenues from continuing operations, excluding T-Mobile USA which T-Mobile agreed to sell to AT&T, dropped by 3.7 percent to EUR 10.83 billion. The adjusted EBITDA fell 5.0 percent year-on-year to EUR 4.48 billion, as encouraging developments at T-Systems and Telekom Deutschland could not offset lower EBITDA in the US and Europe due to a difficult competitive environment, regulatory intervention and tax burdens. The adjusted EBITDA from continued operations decreased 2.7 percent to EUR 3.61 billion. The net profit dropped by 43.3 percent to EUR 480 million, and the adjusted net profit decreased 27.3 percent to EUR 701 million. Free cash flow fell 26.3 percent to EUR 1.1 billion in the first quarter of 2011. This was largely due to different seasonal influences on capital expenditure and interest payments compared with the prior year. The company confirmed its outlook for the full year 2011, expecting an adjusted EBITDA of EUR 19.1 billion. This includes the T‑Mobile USA contribution of USD 5.5 billion. Free cash flow is expected to total at least EUR 6.5 billion, not including the amount of EUR 0.4 billion for the settlement of the dispute regarding PTC in Poland. 


The sale of T-Mobile USA to AT&T, which still needs approval from the anti-trust authorities, together with the establishment of the Everything Everywhere joint venture in the UK and the securing of undisputed ownership in the Polish company PTC, means that the "Fix" component of the strategy presented in March 2010 is now largely complete. The "Transform" and "Innovate" elements are now in the spotlight and the figures for the first quarter show that measures in these areas have also been successful, Deutsche Telekom said. For example, revenue in the mobile internet growth area climbed 28 percent year-on-year to EUR 1.2 billion. The deal in the US has not affected the target of generating by 2015 around half of the group’s revenue in the growth areas specified in the strategy presentation.

Categories:

General

Companies:

T-Systems,  PTC,  T-Mobile UK,  T-Mobile USA,  Telekom Deutschland,  Deutsche Telekom

Regions:

Europe,  Global

Countries:

Germany,  United States

Tags:

Sales figures, Financial figures

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