Deutsche Telekom Ag · XETR:DTE
Deutsche Telekom — FY2021 Earnings Presentation
53 slides from Deutsche Telekom's earnings presentation, Feb 24, 2022
Slide 1: Deutsche Telekom 2021 results
Deutsche Telekom 2021 results
Slide 2: Disclaimer
Disclaimer This presentation 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, dep
Slide 3: Review 2021 accelerated delivery on CMD 2021 targets
Review 2021 accelerated delivery on CMD 2021 targets Organic growth Capital allocation/portfolio Shareholder value Commercial growth Decisive steps towards TMUS majority Adj. EPS taken (+5.2pp to 48.4%1) • 7.1 mn new postpaid subs • €1.22 in 2021 • 0.8 mn new broadband subs Sale of TM NL at €5.1 bn
Slide 4: Financials 2021
Financials 2021
Slide 5: Financials 2021 reported strong growth
Financials 2021 reported strong growth € mn Q4 FY 2020 2021 Change 2020 2021 Change Revenue 27,622 28,934 +4.7% 100,999 108,794 +7.7% Adj. EBITDA AL 8,952 9,007 +0.6% 35,017 37,330 +6.6% Adj. EBITDA AL (excl. US) 3,413 3,524 +3.3% 14,020 14,633 +4.4% Adj. Net profit 1,643 1,234 -24.9% 5,715 5,862
Slide 6: Financials 2021 organic strong organic growth
Financials 2021 organic strong organic growth FY/21 Adj. EBITDA AL FY/21 Adj. EBITDA AL2 FY/21 Key Financials growth yoy, organic € mn % growth yoy, organic TMUS 0.1%1 Revenue +4.5% +€30 mn Service Revenues +3.5% GER 9,520 3.7% Service Revenues +€339 mn +2.0% (excl. US) EU 5.4% Adj. EBITDA AL +1.9%
Slide 7: Financials 2021 FCF AL and net income better than guidance
Financials 2021 FCF AL and net income better than guidance Free Cash Flow AL1 Adj. net profit € mn € mn +2.6% +40.1% -1,353 -1,054 2,801 -998 8,810 -895 4,670 -96 5,715 -220 5,862 -188 6,288 FY/20 Net CF gen. Leasing Capex (excl. Others FY/21 FY/20 Adj. EBITDA D&A Financial Taxes Minorities FY/21 fr
Slide 8: Financials 2021 net debt and leverage ratios
Financials 2021 net debt and leverage ratios Net debt excl. leases (AL) Leverage ratios € bn +11.0 100.6 CMD: back in 6.1 89.6 8.4 1.6 0.6 2.25.–2.75 -8.8 3.1 range YE 24 3.06x 2.70x FY/20 FCF AL Dividends Spectrum Acquisition Softbank F/X and FY/21 Excl. Leases Incl. Leases of Shentel option others
Slide 9: CMD 2018 review strong delivery on commitments
CMD 2018 review strong delivery on commitments Ambition Merger Impact Achievements 2017-20211 Revenue CAGR1 1–2% 3.3% Adj. EBITDA (AL) CAGR 2–4% 5.3%/7.7%2 Adj. EBITDA (AL) CAGR (ex US) 2–3% 3.7% FCF (AL) CAGR ~10%; 2021: >€8 bn Dilutive 18.7%; €8.8 bn FCF (AL) (ex US) 2021: ~€4
Slide 10: Financials 2017–2021 consistent growth in key KPIs
Financials 2017–2021 consistent growth in key KPIs Service revenues Adj. EBITDA AL FCF AL >€18 bn in % growth yoy, organic % growth yoy, organic € bn 2024e 7.9% 7.8%1 8.8 7.2% 7.0 6.3 6.3 3.7% 3.5% 4.9% 5.5 4.2% 2.6% 2.6% 1.6% 1.9% 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 2017 2018 2019 202
Slide 11: Indirect costs CMD 2018 target overdelivered, CMD 2021 target on track
Indirect costs CMD 2018 target overdelivered, CMD 2021 target on track Organic net savings 2017–2021 Organic net savings 2020–2024 € bn € bn 1.8 2018 CMD target €1.5 bn Germany/GHS1 1.0 • 9% of IDC AL saved -0.4 • Driven by greater agility and digitalization • Personal productivity Europe 0.4 +20% T
Slide 12: Guidance 2022 group outlook
Guidance 20221 group outlook Core EBITDA AL Adj. TM US DT Ex US Adj. EBITDA AL TM US DT Ex US € bn +5% € bn 36.5 ~36.5 33.7 ~35.5 22.7 22.3 19.9 21.3 13.8 14.2 13.8 14.2 FY/21 pro Guidance 2022 FY/21 pro Guidance 2022 forma results forma results FCF AL TM US DT Ex US Adj. EPS € bn €/share 1.22 >1.25
Slide 13: Operations Review 2021
Operations Review 2021
Slide 14: Networks leading with 5G, FTTH well on track
Networks leading with 5G, FTTH well on track FTTH (1 Gbps) 5G TM US 5G Germany Homes passed1 Ultra capacity 5G2 % of POPs +36.0% mn 33.3% mn POPs +98.1% >90 10.4 67 7.8 210 7.0 106 5.6 2.2 3.4 YE/20 YE/21 YE/20 YE/21 YE/20 YE/21 On track for CMD targets Targeting 260m YE 2022 >3500 antennas wi
Slide 15: Customers consistent strong growth
Customers consistent strong growth Mobile net adds Fixed line net adds '000 US (postpaid) '000 Broadband 5,486 5,495 716 764 4,459 4,515 585 645 3,620 506 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 2,167 Ex US (contract)1 TV 1,689 1,690 1,628 456 1,523 359 343 366 347 2017 2018 2019 2020 2021
Slide 16: Society and Environment strong ESG Performance in all dimensions
Society and Environment strong ESG Performance in all dimensions Societal agenda Environmental agenda Customer satisfaction Energy consumption/intensity2 Tri*M • Switch to 100% electricity from renewables accomplished mn MWh 67.3 72.7 73.4 12.8 13.3 • Eco Rating: Successful launch of industrywide in
Slide 17: Germany Review 2021
Germany Review 2021
Slide 18: Germany 21st consecutive quarter of EBITDA growth
Germany 21st consecutive quarter of EBITDA growth Revenues (as reported) Adj. EBITDA AL (as reported) € mn € mn +1.0% +3.5% 6,264 6,329 2,324 2,405 Q4/20 Q4/21 Q4/20 Q4/21 Revenue growth1 Adj. EBITDA AL1 % growth yoy, organic % growth yoy, organic 3.4% 2.9% 3.5% 3.8% 3.8% 3.6% 2.1% 1.8% 0.6% 1.1% Q4
Slide 19: Germany service revenue growth driven by mobile and fixed
Germany service revenue growth driven by mobile and fixed Total service revenue1,2 Mobile service revenue1 % growth yoy, organic 2.1% % growth yoy, organic 2.3% 1.7% 1.8% 1.6% 2.0% 2.0% -0.1% Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 -0.8% -1.7% Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Fixed service revenue growth1,2 % gr
Slide 20: Germany positive mobile KPIs
Germany positive mobile KPIs Magenta EINS share (mobile)1 Data usage2 % GB per month 7.7 62% 63% 6.0 +28% y/y Q4/20 Q4/21 Q4/20 Q4/21 Churn2 Branded contract net adds3 % '000 0.9% 202 0.8% 175 182 147 135 Q4/20 Q4/21 Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 1 B2C T-branded contract customers 2 B2C T-branded co
Slide 21: Germany strong commercials in fixed
Germany strong commercials in fixed Broadband net adds TV net adds '000 '000 121 77 93 93 90 84 32 37 33 34 Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Line losses Fiber net adds Retail '000 '000 Wholesale • 1.2 mn super vectoring customers 415 -7 368 -12 -12 -18 291 276 274 -29 269
Slide 22: Germany growth in retail fixed
Germany growth in retail fixed Retail fixed revenues (reported)1,2 Broadband revenue1 € mn +2.3% % growth yoy 3,111 3,184 6.4% 6.5% 6.4% 6.0% 5.5% Broadband revenues +6.0% 1,563 1,657 Single play and other revenues 1,548 1,527 -1.4% Q4/20 Q4/21 Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Retail fixed revenue grow
Slide 23: Germany FTTH on track with buildout and monetization
Germany FTTH on track with buildout and monetization Progress with FTTH buildout Progress with monetization Homes passed, mn Share of ≥ 100 Mbps contracts Retail broadband ARPA2 % of broadband base €/month 33.0 33.3 34.2 32.5 New Collaborations 25.0 17.6 ~5.4 Own 3.4 10.0 buildout1 2019 2020 2021 20
Slide 24: Germany ongoing strong execution and digitization
Germany ongoing strong execution and digitization Service Digitization Customer satisfaction First contact resolution App penetration E-sales share1 TRI*M % +5% % % 52 55 66 24 25 69% 69% 43 56 61% 19 42 2019 2020 2021 2019 2020 2021 2019 2020 2021 2019 2020 2021 Employee satisfaction Customer compl
Slide 25: Germany consistent growth
Germany consistent growth Total service revenue Adj. EBITDA AL CMD: 2.5–3.0% % growth yoy, organic % growth yoy, organic CAGR 2020–2024 3.7 2.8 2.4 1.8 1.7 1.5 0.8 0.7 0.6 0.1 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 • 2021 positively impacted by non-recurring public sector revenues • 2022
Slide 26: T-Mobile US Review 2021
T-Mobile US Review 2021
Slide 27: T-Mobile US continued strong performance
T-Mobile US continued strong performance Revenues (IFRS) Adj. EBITDA AL (IFRS) US$ bn US$ bn +2.7% -5.0% 20.5 21.1 6.6 6.3 Other revenues 6.5 6.2 yoy decline in handset Service revenues 14.0 14.8 leasing revenues by US$0.6 bn Q4/20 Q4/21 Q4/20 Q4/21 Service revenue (US GAAP)1 Core EBITDA (US GAAP)1
Slide 28: T-Mobile US industry leading network and strong customer KPIs
T-Mobile US industry leading network and strong customer KPIs Ultra Capacity 5G coverage1 5G EXTENDED RANGE 5G ULTRA CAPACITY Total postpaid net additions mn POPs mn 300 1.8 260 1.6 210 1.2 1.3 1.3 106 2020 2021 2022e 2023e Q4/20 Q1/21 Q2/21 Q3/212 Q4/21 Annual synergies Postpaid phone churn US$ bn
Slide 29: T-Mobile US consistent growth leader
T-Mobile US consistent growth leader Key opportunities Service revenue (US GAAP)1 Customer growth % growth yoy, organic Postpaid net adds in mn • SMRA 8.3% • B2B 6.1% 6.3% 6.6% 5.2% • Home internet 2017 2.8 3.6 • Sprint Integration 2017 2018 2019 2020 2021 2018 3.1 4.5 Key advantages Adj. EBITDA (US
Slide 30: Europe Review 2021
Europe Review 2021
Slide 31: Europe 16th consecutive quarter of organic EBITDA growth
Europe 16th consecutive quarter of organic EBITDA growth Revenues (Reported) Adj. EBITDA AL (Reported) € mn € mn -2.1% +0.4% 2,992 2,928 958 962 decline driven by sale decline driven by sale of Romania fixed of Romania fixed Q4/20 Q4/21 Q4/20 Q4/21 Revenues Adj. EBITDA AL % growth yoy, organic % gro
Slide 32: Europe strong commercial performance
Europe strong commercial performance1 Mobile contract net adds Broadband net adds '000 274 '000 173 176 171 149 110 98 87 83 76 Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Q4/20 Q1/21 Q2/21 Q3/21 Q4/212 FMC net adds3 TV net adds '000 268 '000 223 226 224 169 75 71 48 58 26 Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Q4/20 Q1/2
Slide 33: Europe fastest growing large European telco
Europe fastest growing large European telco FTTH (1 Gbps)1 Total service revenue growth Digitization Organic, % • 1.4 mn additional homes passed in 2021 • App penetration 64% • 7 mn homes YE 21 • Truck Rolls reduced by 200k in 2021 1.8% 1.9% 2.0% leading to a significant CO2 reduction. 0.4% 0.7% 201
Slide 34: Group Development Review 2021
Group Development Review 2021
Slide 35: Group Development ongoing strong performance
Group Development ongoing strong performance Revenues Adj. EBITDA AL € mn € mn +10.3% +24.8% 740 816 332 266 NL 183 NL 505 537 135 GD Towers 246 277 Others 148 166 GD Towers -11 2 -17 -17 Others Q4/20 Q4/21 Q4/20 Q4/21 Revenues Adj. EBITDA AL Growth org excl HfS1 % growth yoy, organic 5.0% 5.4% % gr
Slide 36: GD/TMNL strong performance continues
GD/TMNL strong performance continues Contract net adds Mobile service revenue growth '000 % growth yoy, organic 6.4% 70 4.9% 58 52 3.5% 0.6% 22 12 -0.9% Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Q4/20 Q1/21 Q2/21 Q3/21 Q4/21 Broadband net adds Adj. EBITDA AL growth '000 % growth yoy, organic 38.9% 21 19 15 14 2
Slide 37: GD/Towers ongoing expansion
GD/Towers ongoing expansion Total sites1 Recurring rental revenues '000 € mn 40.6 +14.4% 35.7 7.0 • 6.3k sites built 2017-2021 (organic +9.1%) • External recurring 3.2 0.0 0.0 o/w 1.4k in 2021 revenues Q4/21: 254 Organic +12,8% 222 32.5 33.6 Austria • 24% of recurring sales NL are external DFMG Q4/2
Slide 38: Systems Solutions Review 2021
Systems Solutions Review 2021
Slide 39: Systems Solutions recovery under way
Systems Solutions recovery under way Order entry (LTM) Revenues Adj. EBITDA AL € bn € mn € mn -8.5% -4.6% +1.4% 4.6 4.2 1,077 1,027 71 72 Q4/20 Q4/21 Q4/20 Q4/21 Q4/20 Q4/21 Revenues Adj. EBITDA AL % growth yoy, organic % growth yoy, organic • Strong growth in Public Cloud and Digital 16.5% Solution
Slide 40: Systems Solutions turnaround continues
Systems Solutions turnaround continues Revenue drivers Revenue Transformation drivers % growth yoy, organic IDC savings € bn Public Cloud +19%1 1.1% 0,39 Digital Solutions +14%1 2021 0,06 Ongoing legacy decline (MIS -14%1 ) -1.0% -1.1% 2020 0,11 -2.1% MIS now down to 32% of TSI revenues vs.
Slide 41: Outlook
Outlook
Slide 42: Guidance 2022 group outlook
Guidance 20221 group outlook Core EBITDA AL Adj. TM US DT Ex US Adj. EBITDA AL TM US DT Ex US € bn +5% € bn 36.5 ~36.5 33.7 ~35.5 22.7 22.3 19.9 21.3 13.8 14.2 13.8 14.2 FY/21 pro Guidance 2022 FY/21 pro Guidance 2022 forma results forma results FCF AL TM US DT Ex US Adj. EPS € bn €/share +18% 1.22
Slide 43: Financials growing adj. EPS and dividends
Financials growing adj. EPS and dividends Adj. EPS/Dividend per share1 Dividend policy €/share Adjusted EPS payout ratio: 40–60% >1.75 >1.25 1.20 1.22 1.04 0.96 2018 2019 2020 2021 2022e 2024e 70c 60c 60c 64c 1 2020 EPS benefitted from TM US options (+17c). 2021 includes -4c from TM US options and +
Slide 44: Appendix
Appendix
Slide 45: FCF AL excl. US
FCF AL excl. US € bn FY 2020 FY 2021 Adj. EBITDA AL 14.0 14.6 Cash Capex -7.7 -7.7 Proceeds from sale of fixed assets +0.2 +0.1 Special Factors Cash -1.4 -1.1 Interest ex leasing -0.6 -0.6 Cash Taxes -0.6 -0.8 Other (working capital etc.) -0.4 -0.6 FCF AL 3.3 3.9 45
Slide 46: Organic growth rates
Organic growth rates In % Q4/21 over Q4/20 FY/21 over FY/20 Group revenue +2.3 +4.5 Group service revenue +4.2 +3.5 Service revenue excl. US +2.8 +2.0 Group Adj. EBITDA AL -1.5 +1.9 Adj. EBITDA AL excl. US +5.0 +4.8 Group adj. core EBITDA AL1 +5.1 +7.8 1 adj. EBITDA AL excl. TM US handset leases 46
Slide 47: Outlook 2022/23 as per annual report 2021 (1/2)
Outlook 2022/23 as per annual report 2021 (1/2)1 € bn 2021 pro forma 2022e 2023e Revenue Group 106.5 Stable Slight increase Germany 24.2 Slight increase Increase US (in US$) 81.0 Stable Slight increase Europe 11.0 Slight increase Stable Systems Solutions 4.2 Stable Slight increase Group Development
Slide 48: Outlook 2022/23 as per annual report 2021 (2/2)
Outlook 2022/23 as per annual report 2021 (2/2)1 € bn 2021 pro forma 2022e 2023e Cash Capex Group 17.7 19.3 Strong decrease Germany 4.1 Increase Increase US (in US$) 12.2 Strong increase Strong decrease Europe 1.7 Stable Stable Systems Solutions 0.2 Stable Stable Group Development 0.3 Strong increas
Slide 49: EX US financials
EX US financials Adj. EBITDA AL Cash capex FCF AL € bn € bn € bn 14.6 14.2 14.0 13.8 7.7 7.7 7.7 7.3 3.9 3.7 3.5 3.3 2020 2021 2021 2022e 2020 2021 2021 2022e 2020 2021 2021 2022e pro forma pro forma pro forma CMD targets1 • 2–3% CAGR in 2020-24 • Increase for FTTH of ~€ 0.5 bn • ~€ 4.0 bn in 2024 f
Slide 50: Balance sheet sequential increase in leverage ratios
Balance sheet sequential increase in leverage ratios € bn 31/12/2020 31/03/2021 30/06/2021 30/09/2021 31/12/2021 Balance sheet total 264.9 273.9 270.5 273.4 281.6 Shareholders’ equity 72.6 77.5 77.0 78.9 81.5 Net debt excl. leases (AL) 89.6 98.3 96.8 99.3 100.6 Net debt excl. leases (AL)/adj. EBITDA
Slide 51: Financials well balanced maturity profile with strong liquidity reserve
Financials well balanced maturity profile with strong liquidity reserve DT (ex US) bonds maturing Ex US liquidity position € bn € bn Credit lines 14.5 Liquid assets 4.1 3.4 3.2 Ø 3.2 3.4 7.5 12.7 2.0 4.1 1.8 2022 2023 2024 2025 Liquidity Maturities Maturities Total maturities reserve 2022 2023 next
Slide 52: Conference call with Q&A session
Conference call with Q&A session The conference call will be held on February 24 at 2:00 PM CET, 1:00 PM GMT, 8 AM ET. DT Participants: Tim Hoettges (CEO), Christian Illek (CFO), Hannes Wittig (Head of IR) Webcast Dial-in • The link to the webcast will be provided 20 minutes before the DE 0800 58891
Slide 53: Further questions please contact the IR department
Further questions please contact the IR department Investor Relations Contact details Phone +49 228 181 – 8 88 80 E-Mail investor.relations@telekom.de Contact details for all IR representatives: www.telekom.com/ircontacts IR Webpage IR Twitter Account IR YouTube Channel www.telekom.com/investors www