Deutsche Telekom has confirmed its guidance for the full year following a solid third quarter. Excluding the effects of the joint venture in the United Kingdom, Deutsche Telekom expects to generate adjusted EBITDA of approximately EUR 20 billion and free cash flow of at least EUR 6.2 billion. By the end of the first nine months, adjusted EBITDA amounted to EUR 14.9 billion, while free cash flow stood at EUR 4.8 billion.
"We are delivering what we promised. We have made our mark and posted good results in an environment that was not always favorable. In terms of both finance and operations, the Group’s development has completely fulfilled our expectations," said René Obermann, CEO of Deutsche Telekom.
Net profit after elimination of the deconsolidation effect of T-Mobile UK developed positively in the third quarter, increasing by almost 22 percent. Adjusted net profit rose by 1.5 percent. On this basis, total revenue edged up 1.0 percent to EUR 15.6 billion. Adjusted EBITDA decreased as expected compared with a strong prior-year quarter. This was primarily due to higher customer acquisition costs in the United States and the Netherlands. The economic environment in Southeastern Europe and regulatory effects also contributed to a decrease of 6.1 percent in adjusted EBITDA to EUR 5.0 billion in the third quarter.
On a reported basis - i.e., before elimination of the deconsolidation effect of T-Mobile UK - unadjusted net profit also developed satisfactorily, increasing by around 8 percent year-on-year to over EUR 1 billion. Adjusted net profit decreased by 9.8 percent to around EUR 1 billion. Revenue decreased by 4.1 percent in the third quarter, while adjusted EBITDA fell by 9.2 percent. At EUR 1.9 billion, free cash flow continued its solid growth trend during the year, although it was lower than in the third quarter of 2009, when figures were influenced by the sale of receivables.
Deutsche Telekom is also on track in the implementation of its Group strategy. In the domestic business, the operating targets for new DSL customer market share, line losses, and Entertain products set for the year as a whole will be reached. Mobile data revenues in the Group rose by 26 percent to EUR 3.2 billion. The success of the Save for Service cost-cutting program continues. This year we have made savings of EUR 1.7 billion in total. The Group will exceed its original full-year target of EUR 2 billion.
The Group's balance sheet ratios are very sound once again. The equity ratio increased by 1.7 percentage points year-on-year to 33.9 percent. "We have come through the crisis in good shape and even succeeded in improving our KPIs," said Deutsche Telekom's Chief Financial Officer Timotheus Höttges.
Germany - still market leader in mobile communications In the domestic mobile communications business, Deutsche Telekom maintained its market leadership in service revenues in the third quarter. The focus remained on value-driven growth. Attractive smartphones such as the third- and fourth-generation Apple iPhones as well as a variety of handsets running the Android operating system contributed to this success. Smartphones accounted for 53 percent of all handsets sold. The fixed-network broadband market share has remained stable at over 46 percent since 2007. A total of 1.4 million Entertain packages had been sold at September 30, 2010. The number of lines lost in the third quarter of 2010 was slightly lower than in the prior-year quarter.
In a solid third quarter of 2010, revenue in the Germany operating segment decreased by 2.4 percent year-on-year to EUR 6.3 billion. Revenue in the first nine months of 2010 declined by 1.7 percent year-on-year to EUR 18.7 billion. In a year-on-year comparison of the third quarters, adjusted EBITDA was stable at EUR 2.5 billion. Amounting to EUR 7.3 billion in the first nine months, adjusted EBITDA therefore remained constant at the prior-year level.
Total revenue from domestic mobile communications business increased by 2.3 percent in the third quarter of 2010 to EUR 2.2 billion. This includes a one-time effect from the expiration of the national roaming agreement with O2 at the end of 2009. Excluding this effect, revenue grew by 6.4 percent. This success was largely due to the extremely positive trend in service and data revenues. Service revenues rose by 5 percent in the third quarter of 2010, while mobile data revenues were up nearly 27 percent. Data revenues in the first nine months of the year climbed by as much as 39 percent.
Adjusted EBITDA from mobile communications increased by nearly 1 percent in the third quarter to EUR 0.9 billion. After eliminating the effect of the expiration of the national roaming agreement with O2, adjusted EBITDA rose by 11 percent. The adjusted EBITDA margin was 43.0 percent, an improvement of 1.7 percentage points taking into account the above-mentioned effect.
The number of mobile communications customers decreased by 4.2 million compared with year-end 2009 to 34.9 million in the first three quarters of 2010. This was mainly attributable to the deregistration of inactive prepay customer cards, which had no effect on revenue. The number of contract customers was slightly higher year-on-year at 17.2 million.
Fixed-network business recorded a decrease in revenue of 4.3 percent in the third quarter of 2010 to EUR 4.5 billion. Adjusted EBITDA remained virtually constant over the same period with a drop of 0.6 percent year-on-year. The drop in revenue was almost offset by extensive cost-cutting measures in the Save for Service program in particular.
United States - strong growth in data revenues Rising by 24 percent year-on-year to USD 12.40, average data revenue per customer recorded strong growth in the third quarter. The 7.2 million 3G-capable smartphones in T-Mobile USA's network at the end of the third quarter are also testament to the rapid spread of the mobile Internet on the U.S. market. Three months before, the number of handsets had stood at 6.5 million.
T-Mobile USA's customer base grew by 137,000 in the past quarter to 33.8 million customers. After witnessing a decline in the total customer base both in the prior quarter and in the same period of the previous year, Deutsche Telekom’s U.S. mobile communications subsidiary thus reported growth again between July and September 2010. While the number of contract customers fell by 60,000 during these three months, 196,000 new prepay customers were acquired in the same period. As a result of seasonal fluctuations and increased competition, contract customer churn rose slightly compared with the previous quarter to the level recorded in the prior-year period.
The stabilization trend in T-Mobile USA's service revenues continued, with USD 4.6 billion in the third quarter of 2010, just 0.4 percent lower than in the prior-year period. The year-on-year decrease in the second quarter was 1.1 percent. Total revenue in the third quarter slipped 0.5 percent year-on-year to USD 5.4 billion. Seen over the first nine months of the year, total revenue was down 1.0 percent year-on-year to USD 16.0 billion. The strength of the U.S. dollar meant that, after translation into euros, revenue grew 10.2 percent in the third quarter to EUR 4.1 billion and 2.8 percent in the first nine months of 2010 to EUR 12.1 billion.
T-Mobile USA's adjusted EBITDA decreased by 14.8 percent in the third quarter to USD 1.3 billion. This decline was attributable to higher customer acquisition costs, which are reflected in higher gross additions, as well as to higher network costs. Translated into euros, EBITDA in the third quarter was down 5.6 percent to EUR 1.0 billion. EBITDA in the first nine months of the year fell by 5.1 percent to EUR 3.2 billion.
Europe - stable margin in a difficult environment The mobile communications and fixed-network companies that were brought together to create the Europe operating segment continued to make progress in the third quarter. In spite of intense competition and a negative impact from regulatory decisions in a number of countries, the companies continued to record high levels of profitability. The adjusted EBITDA margin in the Europe segment in the third quarter of 2010 remained virtually stable at 35.5 percent compared with 36.0 percent in the prior-year period. Seen over the first nine months of the year, it increased by 1.8 percentage points, from 32.9 percent to 34.7 percent.
The segment's business figures were influenced to a significant extent by the deconsolidation of T-Mobile UK effective April 1, 2010. Total revenue declined by 19.5 percent to EUR 4.1 billion compared with the third quarter of 2009. After elimination of T-Mobile UK's contribution, total revenue fell just 3.6 percent. Adjusted EBITDA shows a similar picture. In the third quarter, adjusted EBITDA fell by 20.6 percent, although compared with the prior-year period, after elimination of T-Mobile UK the decrease was 11.9 percent.
In the fixed-network business, the uptrend in retail broadband lines continued, with the number of lines increasing by over 500,000 or almost 14 percent compared with the third quarter of 2009 to 4.2 million. Very strong growth was recorded in the IPTV business, where the number of customers surged almost 70 percent to 571,000 within the space of a year. The companies in Croatia and Hungary were the main drivers of this development.
In mobile communications, the contract customer share of the total customer base rose further to 43.2 percent as of September 30, 2010, from 40.0 percent one year before. In the third quarter, the companies in this segment acquired nearly 300,000 new contract customers, with the Netherlands and Poland recording particularly positive developments.
Systems Solutions - accelerated revenue growth T-Systems' business in the third quarter was once again dominated by continued revenue growth and a clear improvement in earnings.
The encouraging development of total revenue accelerated in the third quarter, when revenue was up 3.8 percent compared with a 2.9 percent increase in the previous three months. This was driven in particular by the disproportionately high level of growth - 11 percent - in T-Systems' international business. Revenue generated outside the Group also increased substantially. T-Systems’ revenue increase of 6 percent exceeds the anticipated average growth rate of 5 percent announced in March.
In the first nine months of the year, total revenue rose by 2.6 percent year-on-year to EUR 6.6 billion. Intragroup revenue declined by 3.3 percent year-on-year to EUR 1.9 billion.
In spite of the fact that the global economy has not yet fully recovered, new orders were up slightly by 1.0 percent in the first nine months of the year. New big deals in 2010 include those with the Hesse Center for Data Processing, Deka-Bank, TUI Travel, and Deutsche Post DHL.
T-Systems also became more profitable in the third quarter. Adjusted EBIT increased by 14.1 percent to EUR 73 million as a result of the Save for Service efficiency enhancement program as well as the optimized utilization of non-current assets. At EUR 196 million for the first three quarters of 2010, adjusted EBIT was up almost 26 percent on the prior-year period. The adjusted EBIT margin totaled 3.3 percent in the third quarter, up from 3 percent in the prior-year period.
Pro forma figures for the third quarter (adjusted for the deconsolidation of T-Mobile UK effective April 1, 2010) In the United Kingdom, the former T-Mobile UK became part of the joint venture with France Télécom's subsidiary Orange UK called Everything Everywhere effective April 1, 2010. In the following tables, revenue, adjusted EBITDA, and adjusted and unadjusted net profit in the third quarters are presented both including and excluding T-Mobile UK to improve the transparency of the development of operations in the third quarter of both years.
This presentation is a supplement to the table showing the actual figures for both quarters.
| Reported | Pro forma |
| Q3 2010 millions of EUR | Q3 2009 millions of EUR | Q3 2010 millions of EUR | Q3 2009 millions of EUR | Change % |
| Net revenue | 15,601 | 16,262 | 15,601 | 15,448 | 1.0 |
| Adjusted EBITDA | 5,021 | 5,528 | 5,021 | 5,345 | (6.1) |
| Net profit | 1,035 | 959 | 1,087 | 892 | 21.9 |
| Adjusted net profit | 969 | 1,074 | 1,021 | 1,006 | 1.5 |
Comments on the table: The third quarter of 2009 has been fully adjusted to eliminate the revenue and earnings contribution of T-Mobile UK to adjusted EBITDA, net profit, and adjusted net profit. The third quarter of 2010 has been adjusted to eliminate the joint venture's contribution to earnings.
The Deutsche Telekom Group at a glance*:
T-Mobile UK no longer fully consolidated since April 1, 2010
| Q3 2010 millions of EUR | Q3 2009 millions of EUR | Change % | Q1-Q3 2010 millions of EUR | Q1-Q3 2009 millions of EUR | Change % | FY 2009 millions of EUR |
| Net revenue | 15,601 | 16,262 | (4.1) | 46,944 | 48,402 | (3.0) | 64,602 |
| Of which: domestic | 6,783 | 7,201 | (5.8) | 20,283 | 20,961 | (3.2) | 28,033 |
| Of which: international | 8,818 | 9,061 | (2.7) | 26,661 | 27,441 | (2.8) | 36,569 |
| Profit from operations (EBIT) | 1,941 | 2,498 | (22.3) | 5,681 | 4,754 | 19.5 | 6,012 |
| Adjusted EBIT | 2,205 | 2,643 | (16.6) | 6,682 | 6,818 | (2.0) | 9,158 |
| EBITDA | 4,761 | 5,394 | (11.7) | 13,930 | 15,363 | (9.3) | 19,906 |
| Adjusted EBITDA | 5,021 | 5,528 | (9.2) | 14,923 | 15,598 | (4.3) | 20,668 |
| Adjusted EBITDA margin | 32.2% | 34.0% | (1.8)%p | 31.8% | 32.2% | (0.4)%p | 32.0% |
| Net profit | 1,035 | 959 | 7.9 | 2,277 | 356 | n.a. | 353 |
| Adjusted net profit | 969 | 1,074 | (9.8) | 2,674 | 2,485 | 7.6 | 3,390 |
| Free cash flow (before dividend payments and spectrum investment) | 1,882 | 3,286 | (42.7) | 4,810 | 5,106 | (5.8) | 6,969 |
| Net cash from operating activities | 3,843 | 5,343 | (28.1) | 9,256 | 11,821 | (21.7) | 15,795 |
| Cash outflows for investments in property, plant and equipment, and intangible assets (excluding goodwill) | 2,036 | 2,131 | (4.5) | 6,011 | 6,953 | (13.5) | 9,202 |
| Net debt at reporting date | - | - | - | 43,747 | 42,389 | 3.2 | 40,911 |
| Number of employees at reporting date | - | - | - | 250,309 | 259,973 | (3.7) | 259,920 |
Germanyoperating segment*:
| Q3 2010 millions of EUR | Q3 2009 millions of EUR | Change % | Q1-Q3 2010 millions of EUR | Q1-Q3 2009 millions of EUR | Change % | FY 2009 millions of EUR |
| Total revenue | 6,317 | 6,471 | (2.4) | 18,703 | 19,022 | (1.7) | 25,423 |
| Of which: fixed network | 4,509 | 4,711 | (4.3) | 13,535 | 14,063 | (3.8) | 18,736 |
| Of which: mobile communications | 2,157 | 2,109 | 2.3 | 6,211 | 6,008 | 3.4 | 8,109 |
| Net revenue | 5,899 | 6,008 | (1.8) | 17,509 | 17,828 | (1.8) | 23,813 |
| Profit from operations (EBIT) | 1,370 | 1,409 | (2.8) | 3,868 | 4,008 | (3.5) | 5,062 |
| Adjusted EBIT | 1,488 | 1,486 | 0.1 | 4,181 | 4,136 | 1.1 | 5,418 |
| EBITDA | 2,405 | 2,446 | (1.7) | 6,947 | 7,146 | (2.8) | 9,258 |
| Adjusted EBITDA | 2,523 | 2,523 | 0.0 | 7,260 | 7,267 | (0.1) | 9,607 |
| Of which: fixed network | 1,595 | 1,604 | (0.6) | 4,593 | 4,795 | (4.2) | 6,247 |
| Of which: mobile communications | 928 | 920 | 0.9 | 2,668 | 2,479 | 7.6 | 3,373 |
| Adjusted EBITDA margin | 39.9% | 39.0% | 0.9%p | 38.8% | 38.2% | 0.6%p | 37.7% |
| Number of employees (average) | 79,318 | 84,369 | (6.0) | 79,925 | 85,199 | (6.2) | 84,584 |
Comments on the table:
The contributions of the Fixed Network and Mobile Communications segments generally show the unconsolidated view and do not take consolidation effects at operating segment level into consideration.
Europeoperating segment*:
| Q3 2010 millions of EUR | Q3 2009 millions of EUR | Change % | Q1-Q3 2010 millions of EUR | Q1-Q3 2009 millions of EUR | Change % | FY 2009 millions of EUR |
| Total revenue | 4,123 | 5,124 | (19.5) | 12,927 | 14,572 | (11.3) | 19,607 |
| Of which: Greece | 979 | 1,087 | (9.9) | 2,939 | 2,800 | 5.0 | 3,899 |
| Of which: Romania | 294 | 296 | (0.7) | 878 | 795 | 10.4 | 1,104 |
| Of which: Hungary | 390 | 437 | (10.8) | 1,194 | 1,240 | (3.7) | 1,682 |
| Of which: Poland | 472 | 450 | 4.9 | 1,364 | 1,306 | 4.4 | 1,757 |
| Of which: Czech Republic | 296 | 313 | (5.4) | 866 | 898 | (3.6) | 1,191 |
| Of which: Croatia | 314 | 315 | (0.3) | 870 | 885 | (1.7) | 1,161 |
| Of which: Netherlands | 450 | 452 | (0.4) | 1,340 | 1,361 | (1.5) | 1,807 |
| Of which: Slovakia | 239 | 244 | (2.0) | 702 | 734 | (4.4) | 974 |
| Of which: Austria | 254 | 260 | (2.3) | 745 | 782 | (4.7) | 1,038 |
| Of which: Bulgaria | 107 | 119 | (10.1) | 316 | 304 | 3.9 | 423 |
| Of which: United Kingdom a | - | 853 | n.a. | 783 | 2,575 | n.a. | 3,390 |
| Of which: other b | 396 | 390 | 1.5 | 1,130 | 1,103 | 2.4 | 1,462 |
| Net revenue | 3,951 | 4,969 | (20.5) | 12,433 | 14,110 | (11.9) | 18,996 |
| Profit from operations (EBIT) c | 622 | 821 | (24.2) | 1,463 | 2 | n.a. | 140 |
| Adjusted EBIT | 632 | 846 | (25.3) | 1,902 | 1,829 | 4.0 | 2,583 |
| EBITDA | 1,457 | 1,830 | (20.4) | 4,049 | 4,790 | (15.5) | 6,297 |
| Adjusted EBITDA | 1,465 | 1,844 | (20.6) | 4,483 | 4,795 | (6.5) | 6,390 |
| Of which: Greece | 376 | 413 | (9.0) | 1,098 | 1,035 | 6.1 | 1,447 |
| Of which: Romania | 71 | 88 | (19.3) | 214 | 227 | (5.7) | 293 |
| Of which: Hungary | 174 | 189 | (7.9) | 507 | 522 | (2.9) | 675 |
| Of which: Poland | 159 | 175 | (9.1) | 504 | 455 | 10.8 | 616 |
| Of which: Czech Republic | 143 | 165 | (13.3) | 417 | 473 | (11.8) | 614 |
| Of which: Croatia | 157 | 153 | 2.6 | 394 | 414 | (4.8) | 525 |
| Of which: Netherlands | 98 | 128 | (23.4) | 339 | 295 | 14.9 | 430 |
| Of which: Slovakia | 109 | 118 | (7.6) | 321 | 350 | (8.3) | 439 |
| Of which: Austria | 69 | 82 | (15.9) | 213 | 205 | 3.9 | 283 |
| Of which: Bulgaria | 42 | 49 | (14.3) | 123 | 123 | 0.0 | 167 |
| Of which: United Kingdom | - | 181 | n.a. | 167 | 447 | n.a. | 611 |
| Of which: other b | 69 | 95 | (27.4) | 209 | 239 | (12.6) | 279 |
| Adjusted EBITDA margin | 35.5% | 36.0% | (0.5)%p | 34.7% | 32.9% | 1.8%p | 32.6% |
| Number of employees (average) | 63,747 | 71,707 | (11.1) | 66,077 | 68,643 | (3.7) | 69,277 |
Comments on the table: The figures for the national companies generally correspond to their respective unconsolidated financial statements and do not take consolidation effects at operating segment level into consideration.
a Deconsolidation of T-Mobile UK effective April 1, 2010.
b Other: national companies of Albania, the F.Y.R.O. Macedonia, and Montenegro, as well as ICSS, Europe Headquarters, and T-Mobile International UK up to and including May 2010.
c Including an impairment loss of EUR 1.8 billion recognized on the goodwill of the cash-generating unit T-Mobile UK in the first quarter of 2009.
United Statesoperating segment*:
| Q3 2010 millions of EUR | Q3 2009 millions of EUR | Change % | Q1-Q3 2010 millions of EUR | Q1-Q3 2009 millions of EUR | Change % | FY 2009 millions of EUR |
| Total revenue | 4,143 | 3,758 | 10.2 | 12,145 | 11,813 | 2.8 | 15,471 |
| Net revenue | 4,140 | 3,755 | 10.3 | 12,135 | 11,802 | 2.8 | 15,457 |
| Profit from operations (EBIT) | 476 | 595 | (20.0) | 1,620 | 1,779 | (8.9) | 2,233 |
| Adjusted EBIT | 476 | 595 | (20.0) | 1,620 | 1,779 | (8.9) | 2,233 |
| EBITDA | 1,028 | 1,089 | (5.6) | 3,156 | 3,326 | (5.1) | 4,261 |
| Adjusted EBITDA | 1,028 | 1,089 | (5.6) | 3,156 | 3,326 | (5.1) | 4,261 |
| Adjusted EBITDA margin | 24.8% | 29.0% | (4.2)%p | 26.0% | 28.2% | (2.2)%p | 27.5% |
| Number of employees (average) | 37,563 | 37,996 | (1.1) | 37,946 | 37,859 | 0.2 | 38,231 |
Systems Solutions operating segment*:
| Q3 2010 millions of EUR | Q3 2009 millions of EUR | Change % | Q1-Q3 2010 millions of EUR | Q1-Q3 2009 millions of EUR | Change % | FY 2009 millions of EUR |
| Total revenue | 2,205 | 2,125 | 3.8 | 6,578 | 6,410 | 2.6 | 8,798 |
| Of which: Computing Services | 766 | 723 | 6.0 | 2,293 | 2,118 | 8.2 | 2,925 |
| Of which: Desktop Services | 348 | 352 | (1.1) | 1,053 | 1,023 | 2.9 | 1,404 |
| Of which: Systems Integration | 436 | 398 | 9.3 | 1,298 | 1,258 | 3.2 | 1,741 |
| Of which: Telecommunications | 761 | 788 | (3.5) | 2,254 | 2,351 | (4.1) | 3,225 |
| Of which: other a | (105) | (136) | 22.9 | (320) | (341) | 6.0 | (497) |
| Net revenue | 1,555 | 1,467 | 6.0 | 4,697 | 4,465 | 5.2 | 6,083 |
| New orders | 1,625 | 1,689 | (3.8) | 6,075 | 6,014 | 1.0 | 9,305 |
| Profit (loss) from operations (EBIT) | (25) | 16 | n.a. | 49 | 54 | (9.3) | (11) |
| Adjusted EBIT | 73 | 64 | 14.1 | 196 | 156 | 25.6 | 229 |
| EBITDA | 126 | 183 | (31.1) | 505 | 571 | (11.6) | 710 |
| Adjusted EBITDA | 222 | 231 | (3.9) | 649 | 673 | (3.6) | 923 |
| Adjusted EBITDA margin | 10.1% | 10.9% | (0.8)%p | 9.9% | 10.5% | (0.6)%p | 10.5% |
| Number of employees (average) | 47,654 | 45,877 | 3.9 | 47,527 | 45,063 | 5.5 | 45,328 |
Comments on the table: a Non-core activities and consolidation.
Group Headquarters & Shared Services*:
| Q3 2010 millions of EUR | Q3 2009 millions of EUR | Change % | Q1-Q3 2010 millions of EUR | Q1-Q3 2009 millions of EUR | Change % | FY 2009 millions of EUR |
| Total revenue | 567 | 593 | (4.4) | 1,715 | 1,823 | (5.9) | 2,410 |
| Net revenue | 56 | 63 | (11.1) | 170 | 197 | (13.7) | 253 |
| Profit (loss) from operations (EBIT) | (462) | (311) | (48.6) | (1,253) | (964) | (30.0) | (1,249) |
| Adjusted EBIT | (423) | (311) | (36.0) | (1,146) | (952) | (20.4) | (1,148) |
| EBITDA | (231) | (112) | n.a. | (653) | (316) | n.a. | (416) |
| Adjusted EBITDA | (192) | (112) | (71.4) | (546) | (304) | (79.6) | (315) |
| Number of employees (average) | 22,547 | 20,548 | 9.7 | 22,339 | 19,970 | 11.9 | 20,181 |
* Deutsche Telekom defines EBITDA as profit/loss from operations before depreciation, amortization and impairment losses. For a detailed explanation of non-GAAP performance measures, special factors affecting EBITDA, adjusted EBITDA, the adjusted EBITDA margin as well as special factors affecting profit or loss and the adjusted net profit, please refer to “Reconciliation to pro forma figures” that is posted on Deutsche Telekom's Investor Relations website at www.telekom.com.
Development of customer numbers in the third quarter of 2010.
Germanyoperating segment:
| Sept. 30, 2010 thousands | Sept. 30, 2009 thousands | Change thousands | Change % |
| Fixed network | | | | |
| Fixed-network lines | 25,024 | 26,653 | (1,629) | (6.1) |
| Broadband lines | 13,880 | 13,570 | 310 | 2.3 |
| Retail | 11,844 | 11,301 | 543 | 4.8 |
| Wholesale bundled lines | 1,143 | 1,752 | (609) | (34.8) |
| ULLs | 9,367 | 8,914 | 453 | 5.1 |
| Wholesale unbundled lines | 892 | 517 | 375 | 72.5 |
| Mobile communications | | | | |
| Mobile customers a | 34,882 | 39,330 | (4,448) | (11.3) |
Comments on the table: a Deregistration of inactive prepay customers' cards: 4.4 million in FY 2009, 1.5 million in Q1 2010, 2.5 million in Q2 2010, 3.1 million in Q3 2010. On April 1, 2010, Telekom Deutschland GmbH began to automatically terminate prepaid cards that have not been topped up for two years and have been inactive for three months.
Europeoperating segment:
| Sept. 30, 2010 thousands | Sept. 30, 2009 thousands | Change thousands | Change % |
| Europetotal a | | | | |
| Fixed-network lines | 11,524 | 12,480 | (956) | (7.7) |
| Retail broadband lines | 4,185 | 3,681 | 504 | 13.7 |
| Wholesale bundled lines | 193 | 246 | (53) | (21.5) |
| ULLs | 1,399 | 971 | 428 | 44.1 |
| Wholesale unbundled lines | 39 | 30 | 9 | 30.0 |
| Mobile customers a | 60,373 | 61,512 | (1,139) | (1.9) |
| Greece Fixed-network lines Broadband lines Mobile customers | 3,858 1,133 8,330 | 4,349 1,066 9,064 | (491) 67 (734) | (11.3) 6.3 (8.1) |
| Romania b Fixed-network lines Broadband lines Mobile customers | 2,625 902 7,059 | 2,832 750 6,599 | (207) 152 460 | (7.3) 20.3 7.0 |
| Hungary Fixed-network lines Broadband lines Mobile customers | 1,690 811 5,147 | 1,870 778 5,207 | (180) 33 (60) | (9.6) 4.2 (1.2) |
| Poland Mobile customers | 13,321 | 13,482 | (161) | (1.2) |
| CzechRepublic Fixed-network lines Broadband lines Mobile customers | 53 53 5,460 | 0 0 5,458 | 53 53 2 | n.a. n.a. 0.0 |
| Croatia Fixed-network lines Broadband lines Mobile customers | 1,437 600 2,774 | 1,497 527 2,885 | (60) 73 (111) | (4.0) 13.9 (3.8) |
| Netherlands Fixed-network lines Broadband lines Mobile customers | 288 288 4,461 | 296 296 5,474 | (8) (8) (1,013) | (2.7) (2.7) (18.5) |
| Slovakia Fixed-network lines Broadband lines Mobile customers | 1,072 424 2,407 | 1,104 372 2,301 | (32) 52 106 | (2.9) 14.0 4.6 |
| Austria Mobile customers | 3,683 | 3,387 | 296 | 8.7 |
| Bulgaria Mobile customers | 3,886 | 3,966 | (80) | (2.0) |
| Other c Fixed-network lines Broadband lines Mobile customers | 500 207 3,845 | 531 169 3,689 | (31) 38 156 | (5.8) 22.5 4.2 |
Comments on the table: a For better comparability, the customers of T-Mobile UK, who were transferred to the Everything Everywhere joint venture as of April 1, 2010, following the merger of T-Mobile UK and Orange UK, were subtracted from all historical customer figures.
b Including the Romanian company Zapp since November 1, 2009.
c Other: national companies of Albania, the F.Y.R.O. Macedonia, and Montenegro.
United Statesoperating segment:
| Sept. 30, 2010 thousands | Sept. 30, 2009 thousands | Change thousands | Change % |
| Mobile customers a | 33,757 | 33,420 | 337 | 1.0 |
Comments on the table: a One mobile communications card corresponds to one customer.
Net additions in the third quarter of 2010.
Germanyoperating segment:
| Q3 2010 thousands | Q3 2009 thousands | Change thousands | Change % |
| Fixed network | | | | |
| Fixed-network lines | (525) | (573) | 48 | 8.4 |
| Broadband lines Retail | 7 49 | (36) 72 | 43 (23) | n.a. (31.9) |
| Wholesale bundled lines | (210) | (200) | (10) | (5.0) |
| ULLs | 74 | 172 | (98) | (57.0) |
| Wholesale unbundled lines | 169 | 92 | 77 | 83.7 |
| Mobile communications | | | | |
| Mobile customers a | (2,094) | 227 | (2,321) | n.a. |
Comments on the table: a Deregistration of inactive prepay customers' cards: 4.4 million in FY 2009, 1.5 million in Q1 2010, 2.5 million in Q2 2010, 3.1 million in Q3 2010. On April 1, 2010, Telekom Deutschland GmbH began to automatically terminate prepaid cards that have not been topped up for two years and have been inactive for three months.
Europeoperating segment:
| Q3 2010 thousands | Q3 2009 thousands | Change thousands | Change % |
| Europetotal a | | | | |
| Fixed-network lines | (212) | (209) | (3) | (1.4) |
| Retail broadband lines | 108 | 102 | 6 | 5.9 |
| Wholesale bundled lines | (9) | (17) | 8 | 47.1 |
| ULLs | 89 | 68 | 21 | 30.9 |
| Wholesale unbundled lines | 3 | 2 | 1 | 50.0 |
| Mobile customers a | (134) | 862 | 996 | n.a. |
| Greece Fixed-network lines Broadband lines Mobile customers | (112) (6) (178) | (57) 31 271 | (55) (37) (449) | (96.5) n.a. n.a. |
| Romania b Fixed-network lines Broadband lines Mobile customers | (41) 62 (28) | (64) 25 269 | 23 37 297 | 35.9 n.a. n.a. |
| Hungary Fixed-network lines Broadband lines Mobile customers | (39) 13 15 | (48) 2 (49) | 9 11 64 | 18.8 n.a. n.a. |
| Poland Mobile customers | 46 | 73 | (27) | (37.0) |
| CzechRepublic Fixed-network lines Broadband lines Mobile customers | 4 4 (5) | 0 0 25 | 4 4 (30) | n.a. n.a. n.a. |
| Croatia Fixed-network lines Broadband lines Mobile customers | (9) 17 (5) | (16) 17 17 | 7 0 22 | 43.8 0.0 n.a. |
| Netherlands Fixed-network lines Broadband lines Mobile customers | 0 0 78 | (5) (5) 51 | 5 5 27 | n.a. n.a. 52.9 |
| Slovakia Fixed-network lines Broadband lines Mobile customers | (12) 5 (6) | (9) 8 (22) | (3) (3) 16 | (33.3) (37.5) 72.7 |
| Austria Mobile customers | 31 | (15) | 46 | n.a. |
| Bulgaria Mobile customers | (68) | (42) | 26 | (61.9) |
| Other c Fixed-network lines Broadband lines Mobile customers | (4) 7 (16) | (9) 9 284 | 5 (2) (300) | 55.6 (22.2) n.a. |
Comments on the table: a For better comparability, the customers of T-Mobile UK, who were transferred to the Everything Everywhere joint venture as of April 1, 2010, following the merger of T-Mobile UK and Orange UK, were subtracted from all historical customer figures.
b Including the Romanian company Zapp since November 1, 2009.
c Other: national companies of Albania, the F.Y.R.O. Macedonia, and Montenegro.
United Statesoperating segment:
| Q3 2010 thousands | Q3 2009 thousands | Change thousands | Change % |
| Mobile customers a | 137 | (77) | 214 | n.a. |
Comments on the table: a One mobile communications card corresponds to one customer.
This press release contains forward-looking statements that reflect the current views of Deutsche Telekom management with respect to future events. These also include statements on market potential, statements on finance guidance as well as on the dividend outlook. They are generally identified by the terms "expect," "anticipate," "believe," "intend," "estimate," "aim for," "goal," "plan," "will," "strive for," "outlook" or similar expressions and often include information that relates to net revenue expectations or targets for adjusted EBITDA, profit or loss, earnings performance and other indicators, as well as personnel-related measures and workforce adjustments. Forward-looking statements are based on current plans, estimates and projections. They should therefore be considered 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, including those described in the sections "Forward-Looking Statements" and "Risk Factors" of the Company's Form 20-F annual report filed with the U.S. Securities and Exchange Commission. Among the relevant factors are the progress of Deutsche Telekom’s workforce reduction initiative, the restructuring of operating activities in Germany, and the impact of other significant strategic or business initiatives, including acquisitions, dispositions, business combinations, and cost reduction measures. In addition, regulatory decisions, stronger than expected competition, technological change, litigation and regulatory developments, among other factors, may have a material adverse effect on costs and revenue development. Furthermore, changes in the economic and business environments – for example, the current economic slump – in markets where we and our subsidiaries and affiliates operate, the enduring instability and volatility on the global financial markets, as well as exchange rate and interest rate fluctuations can also adversely affect our business development and the availability of capital at favorable terms. If these or other risks and uncertainties materialize, or if the assumptions underlying any of these statements prove incorrect, Deutsche Telekom's actual results may be materially different from those expressed or implied by such statements. Deutsche Telekom can offer no assurance that its expectations or targets will be met. Deutsche Telekom does not assume any obligation to update forward-looking statements to take new information or future events into account or otherwise. Deutsche Telekom does not reconcile its adjusted EBITDA guidance to a GAAP measure because it would require unreasonable effort to do so. As a rule, Deutsche Telekom does not predict the net effect of future special factors due to their uncertainty. Special factors and interest, taxes, depreciation and amortization (including impairment losses) can have a significant effect on Deutsche Telekom's results.
In addition to figures prepared in accordance with IFRS, Deutsche Telekom presents non-GAAP financial performance measures, including EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, adjusted EBT, adjusted net profit, free cash flow, gross debt and net debt. These non-GAAP measures should be considered in addition to, but not as a substitute for, the information prepared in accordance with IFRS. Non-GAAP financial performance measures are not subject to IFRS or any other generally accepted accounting principles. Other companies may define these terms in different ways. For further information relevant to the interpretation of these terms, please refer to the chapter “Reconciliation of pro forma figures” posted on Deutsche Telekom's website (www.telekom.com) under the link "Investor Relations."