T-Systems records external and international growth in the first quarter
May 10, 2012
- Declining intra-Group business squeezing total revenue.
- Big deals from South Africa (OMG) and England (BAT).
- Margin improving.
Systems Solutions began the first quarter of 2012 with its revenue from international business increasing by 3.5 percent to EUR 758 million. Externally generated revenues also increased year-on-year, albeit only slightly by 0.6 percent, due to sustained price and competitive pressure.
Revenue generated within the Group decreased as planned. This contribution to reducing costs at Deutsche Telekom outweighed the growth in revenue with external customers. Total revenue therefore decreased by 0.7 percent year-onyear in the first three months to EUR 2.2 billion.
The adjusted EBIT margin, the most important indicator of Systems Solutions' profitability, saw a slight improvement of 1.3 percent to 2.0 percent compared with the prior-year period. Adjusted EBITDA amounted to EUR 192 million. This represents a 1.6-percent year on-year increase.
T-Systems secured big deals from Old Mutual Group (OMG) and British American Tobacco (BAT) in the first quarter. Overall, there was a 33-percent decrease in orders compared with the first quarter of 2011. It should be noted that the high prior-year figure resulted from the big deal with Everything Everywhere.
T-Systems is offering a new telematics solution in the field of connected cars. Since February 2012, forwarding companies can use cloud-based services to plan their routes more efficiently, thereby cutting maintenance costs and saving up to 20 percent on fuel. With TelematicOne, T-Systems delivers a central control unit for all logistics activities, including accessing the position details of trucks, controlling the temperature of goods, and recording transportation routes, containers, and trailers in real time.
Systems Solutions operating segment*:
millions of EUR
millions of EUR
millions of EUR
|Of which: Computing Services||760||799||(4.9)||3,136|
|Of which: Desktop Services||333||335||(0.6)||1,373|
|Of which: Systems Integration||416||466||(10.7)||1,871|
|Of which: Telecommunications||809||771||4.9||3,197|
|Of which: Othera||(72)||(111)||35.1||(328)|
|Profit (loss) from operations (EBIT)||(35)||(11)||n.a.||(43)|
|Adjusted EBITDA margin||8.6%||8.4%||0.2p||9.4%|
|Number of employees |
Comments on the table:
a Non-core activities and consolidation.
This media information contains forward-looking statements that reflect the current views of Deutsche Telekom management with respect to future events. These forward-looking statements include statements with regard to the expected development of revenue, earnings, profits from operations, depreciation and amortization, cash flows, and personnel-related measures. You should consider them with caution. Such statements are subject to risks and uncertainties, most of which are difficult to predict and are generally beyond Deutsche Telekom's control. Among the factors that might influence our ability to achieve our objectives are the progress of our workforce reduction initiative and other cost-saving measures, and the impact of other significant strategic, labor, or business initiatives, including acquisitions, dispositions, and business combinations, and our network upgrade and expansion initiatives. In addition, stronger than expected competition, technological change, legal proceedings, and regulatory developments, among other factors, may have a material adverse effect on our costs and revenue development. Further, the economic downturn in our markets and changes in interest and currency exchange rates may also have an impact on our business development and the availability of financing on favorable conditions. Changes to our expectations concerning future cash flows may lead to impairment write downs of assets carried at historical cost, which may materially affect our results at the group and operating segment levels. If these or other risks and uncertainties materialize, or if the assumptions underlying any of these statements prove incorrect, our actual performance may materially differ from the performance expressed or implied by forward-looking statements. We can offer no assurance that ourestimates orexpectations will be achieved. Without prejudice to existing obligations under capital market law, we do not assume any obligation to update forward-looking statements to take new information or future events into account or otherwise.
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About Deutsche Telekom
Deutsche Telekom is one of the world’s leading integrated telecommunications companies with over 129 million mobile customers, 34 million fixed-network lines and approximately 17 million broadband lines (as of December 31, 2011). The Group provides products and services for the fixed network, mobile communications, the Internet and IPTV for consumers, and ICT solutions for business customers and corporate customers. Deutsche Telekom is present in around 50 countries and has over 235,000 employees worldwide. The Group generated revenues of EUR 58.7 billion in the 2011 financial year - more than half of it outside Germany (as of December 31, 2011).
Drawing on a global infrastructure of data centers and networks, T-Systems operates information and communication technology (ICT) systems for multinational corporations and public sector institutions. T-Systems provides integrated solutions for the networked future of business and society. The company's some 48,200 employees combine industry expertise and ICT innovations to add significant value to customers’ core business all over the world.
T-Systems generated revenue of around EUR 9.2 billion in the 2011 financial year.
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