Wednesday, May 9, 2007

Deutsche Telekom Sees International Growth, Revenues in Germany Drop 5%

Strong growth in international revenue boosted Deutsche Telekom's total revenue in Q1 2007 to EUR 15.5 billion, a rise of 4.1 percent over the previous year. At EUR 7.7 billion, international revenue was 15.5 percent higher than in the same quarter of 2006. This means that Deutsche Telekom generates roughly half of its revenue outside Germany.

Mobile Communications in particular generated strong growth with revenue of EUR 8.4 billion, more than half of the Group's net revenue. First quarter revenue in the Mobile Communications segment was 10.9 percent higher than in the same quarter in the previous year.

However, Deutsche Telekom's revenues in Germany dropped by 5.1 percent from the previous year to EUR 7.8 billion due to sustained competitive pressure and regulatory constraints. Contributing to this were developments in Broadband/Fixed Network, where domestic revenue was EUR 318 million lower than that of the same quarter the previous year.

Some highlights from the company's quarterly report:

DT's Broadband/Fixed Network division added 572,000 new broadband lines in Germany -- the strongest growth ever achieved in one quarter, corresponding to 42 percent of net additions in the overall market for broadband lines. This gives the company a total of 7.6 million proprietary domestic broadband lines.

A loss of 588,000 access lines in the past quarter was mainly due to unbundled loop lines (ULLs) leased to competitors; this figure increased by 484,000 to a total of 5.1 million. A further 104,000 or so lines were lost to substitution by mobile communications and competition from cable services.

In Germany, revenue from Business Customers was down by 9.6 percent year-on-year, dropping to EUR 2.3 billion. The main reasons for this were the increasingly intense competition and sustained price erosion in the traditional telecommunications business.

T-Mobile Deutschland netted 251,000 new contract customers -- compared with 89,000 in the first quarter of 2006.

43 new T-Punkt stores have been opened as part of efforts to strengthen our sales platform.

T-Mobile USA recorded a high net increase in new customers of 980,000 in the first quarter of 2007 (previous year: 1.04 million). Of these, 74 percent were contract customers, slightly higher even than in the first three months of 2006, when it was 70 percent.

In the UK, T-Mobile recorded more than 100,000 new contract customers.

See also