Deutsche Telekom AG — Earnings Release 2002

Nov 14, 2002

News Details

Ad-hoc | 14 November 2002 13:57

Deutsche Telekom AG part 1

Ad hoc notification of Deutsche Telekom AG Ad-hoc-announcement transmitted by DGAP. The issuer is solely responsible for the content of this announcement. ——————————————————————————– Bonn, November 14, 2002 Deutsche Telekom Group Preliminary key figures for the first three quarters of 2002 (January 1, 2002 to September 30, 2002) and results of the strategic review – Group revenue increased by around 12 % to EUR 39.2 billion – Group EBITDA 1 (excluding special influences) up 5.6 % to EUR 12.0 billion – Net loss after taxes at EUR 4.2 billion compared to EUR 2.8 billion – Net loss for the nine month ended September 30, 2002, EUR 24.5 billion, net loss excluding the effects arising from the strategic review EUR 5.3 billion. – Capital expenditure reduced by 24 % to EUR 4.8 billion – Net cash-flow provided by operating activities increased by almost 42 % to EUR 10.1 billion. – Free cash flow increased from EUR 6 million to around EUR 4.7 billion – Reduction of net debt by 1.8 % to EUR 64.0 billion, compared with EUR 64.2 billion at September 30, 2001 – T-Com’s EBITDA was EUR 7.5 billion, remaining at the same level as the previous nine month period, after adjusting for special influences – T-Systems increased adjusted EBITDA compared with the first nine months of 2001 by 33.7 % to EUR 833 million with double -digit EBITDA margin of around 10 % for the first time. – T-Mobile’s revenue of around EUR 14.2 billion after nine months is already almost at the same level as for the whole of 2001. Adjusted EBITDA increased by 76 % to EUR 3.85 billion – With 869,000 new customers, T-Mobile USA records the highest organic growth of all U.S. mobile communications operators in the third quarter – T-Online group improves EBITDA to EUR 35.6 million in Q3 2002 – Board of Management and Supervisory Board propose to suspend dividend for the 2002 financial year – Sale or merger of T-Mobile USA (formerly VoiceStream) not necessary for achieving debt reduction target. 1 EBITDA: Results from ordinary business activities plus the net financial income (expense) net and amortization and depreciation 2 Free cash-flow before dividends: Net cash provided by operating activities minus cash outflow from investments in property plant and equipment and intangible assets. Deutsche Telekom hereby announces the key figures for the first three quarters of the 2002 financial year. Deutsche Telekom emphasizes that these results are only initial results on the basis of current information. Deviations may arise between these figures and the audited figures to be published on November 27. All information is based on calculations made in accordance with the provisions of German GAAP. end of ad-hoc-announcement (c)DGAP 14.11.2002 Issuer’s information/explanatory remarks concerning this ad-hoc-announcement: Revenue and adjusted EBITDA increased Deutsche Telekom recorded revenue growth in the first nine months of 2002 of 12 % compared with the first nine months of 2001 to EUR 39.2 billion. International revenue increased from EUR 8.9 billion in the first nine months of 2001 to EUR 13.2 billion in the period under review. The represents an increase of around 48 %. Revenue generated outside Germany therefore amounted to around 34% of Group revenue in the first nine months of 2002, compared with around 26 % in the first nine months of 2001. The revenue increase is mainly attributable to the strong growth in the mobile communications business, in particular at T-Mobile USA. In the same period, Group EBITDA excluding special influences increased by 5.6 % to EUR 12 billion. Group EBITDA including special influences amounted to EUR 11.4 billion compared with EUR 14.1 billion in the first nine months of 2001. While the adjusted EBITDA of the T-Com division remained largely stable, the other three divisions recorded considerable increases. Special influences affecting EBITDA in the first nine months of 2002 were a book profit of EUR 0.2 billion from the sale of the shares in Satelindo, a book loss of EUR 0.4 billion from the sale of shares in France Telecom and restructuring expenses of EUR 0.4 billion relating to the T-Systems division in the third quarter of 2002. In the first nine months of 2001, by contrast, the special influences affecting EBITDA, amounting to EUR 2.8 billion, were positive. These related to the proceeds from the sale of Sprint FON and PCS shares, minus sale costs, and the proceeds of the sale of the cable network in Baden- Württemberg. Negative special influences from nonscheduled write-downs of goodwill and mobile communications licenses as a result of the strategic review The net loss in the first nine months of 2002 amounted to around EUR 24.5 billion. This includes special influences with a negative net impact on results of EUR 20.3 billion which mainly relate to nonscheduled write-downs of goodwill and licenses of mobile communications companies. Adjusted to exclude special influences, the net loss was EUR 4.2 billion, compared with EUR 2.8 billion in the same period last year. The special influences which had a positive impact on the net loss in the first nine months of 2001 amounting to around EUR 1.8 billion consist of the above-mentioned EUR 2.8 billion which had an effect on EBITDA, minus valuation adjustments on financial assets and the write-downs of the net carrying amount of the stake in France Telecom as a result of the decrease in the share price, and tax effects. End of part 1 of the ad hoc notification of Deutsche Telekom, part 2 to follow ——————————————————————————– WKN: 555750; ISIN: DE0005557508; Index: DAX, EURO STOXX 50 Listed: Amtlicher Markt in Berlin, Bremen, Düsseldorf, Frankfurt, Hamburg, Hannover, Stuttgart und München; EUREX; London, Amsterdam, NASDAQ Europe, Virtex, New York (ADR), Tokio 141357 Nov 02