Slide 1: Deutsche Telekom Q4/12 Results
DEUTSCHE TELEKOM Q4/12 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, de
Slide 3: Review FY 2012
REVIEW FY 2012
Slide 4: 2012 Key Achievements: Financial Targets Achieved, Customer Targets Overachieved
2012 KEY ACHIEVEMENTS: FINANCIAL TARGETS ACHIEVED, CUSTOMER TARGETS IN GERMANY AND EUROPE OVERACHIEVED Group key objectives achieved against industry trend: adj. EBITDA of €18 billion and FCF of €6.2 billion GROUP Dividend policy: proposal of €0.70 dividend per share for FY 2012; prudent and sus
Slide 5: 2012: Key Figures
2012: KEY FIGURES Q4 FY € bn 2011 2012 Change 2011 2012 Change Revenue 14,911 14,707 -1.4% 58,653 58,169 -0.8% Adj. EBITDA 4,611 4,027 -12.7% 18,685 17,978 -3.8% Adj. net profit -92 203 n.a. 2,851 2,529 -11.3% Net profit -1,340 793 n.a. 557 -5,255 n.a. Adj. EPS (in €) -0.02 0.05 n.a. 0.66 0.59 -10.6
Slide 6: 2010 – 2012: Performance Towards Ambition Level
2010 – 2012: PERFORMANCE TOWARDS AMBITION LEVEL Group ambition level 2012 (communicated in 2010) Group wide TV customers 5.5 – 6.0 mn Group wide mobile customers >140 mn Group wide fixed broadband retail customers >18 mn >€6 bn mobile internet revenues Revenues German revenues stabilized Save for Se
Slide 7: Q4/12: Market Invest in Germany and US Impact Adj. EBITDA
Q4/12: MARKET INVEST IN GERMANY AND US IMPACT ADJ. EBITDA Revenue Adj. EBITDA Record smartphone sales Branded contract net adds € mn -1.4% € mn -9.6% in 000 +55.4% in 000 +51.7% 5,810 5,731 2,294 2,073 936 1,455 149 226 Q4/11 Q4/12 Q4/11 Q4/12 Q4/11 Q4/12 Q4/11 Q4/12 Revenue Adj. EBITDA Positive net
Slide 8: DT Group Guidance 2013 and Mid Term Ambition
DT GROUP GUIDANCE 2013 AND MID TERM AMBITION Guidance 20131 (excl./incl. MetroPCS) Mid term ambition1 (incl. MetroPCS) Group revenues Growing 2014 Group adj. EBITDA ≈€17.4 bn/≈€18.4 bn Growing 2014 Group FCF ≈€5 bn/≈€5 bn ≈€6 bn 2015 Group adj. EPS Improvement to ≈€0.8 2015 Group ROCE Improvement to
Slide 9: Germany: Solid Revenue Trends – Adj. EBITDA and Opex Driven by Mobile Investment
GERMANY: SOLID REVENUE TRENDS – ADJ. EBITDA AND OPEX DRIVEN BY 0.2 BILLION INCREASE IN MOBILE MARKET INVESTMENT Revenues Adj. EBITDA € mn Mobile Core fixed Wholesale services Others € mn -9.6% -1.4% 2,294 2,343 2,348 2,401 2,073 5,810 5,659 5,610 5,736 5,731 1,926 1,835 1,852 1,958 1,987 3.2% Q4/11
Slide 10: Germany Fixed: Value Steering Results in Stable Broadband Base
GERMANY FIXED: VALUE STEERING RESULTS IN STABLE BROADBAND BASE AND REVENUE CONTRIBUTION – LINE LOSSES SHRINKING FURTHER German broadband market Average revenue per access growing in mn 27.1 27.4 27.6 27.7 27.9 Cable in € TP 3.8 3.9 4.1 4.3 25.4 25.6 25.7 25.8 25.9 3.5 DSL Competitors 40 DP 11.3 11.3
Slide 11: Germany Mobile: Strong Push in Market Invest in Q4
GERMANY MOBILE: STRONG PUSH IN MARKET INVEST IN Q4 – RETURN TO UNDERLYING REVENUE GROWTH EXPECTED IN 2013 German mobile market service revenue TD mobile service revenue excl. MTR cut € mn TD Mobile Vodafone E-Plus O2 € mn -2.2% 1,728 1,660 1,690 1,749 1,690 -0.4% 10 MTR effect 4,984 4,996 5,114 4,96
Slide 12: Germany: Mobile Service Revenues Outlook 2013
GERMANY: MOBILE SERVICE REVENUES OUTLOOK 2013 Growing ARPU of new branded contract customers Strong increase in contract customers in 2012 + Best network and mobile data proposition Highest customer satisfaction in German mobile Ambition: return to underlying Strong smartphone sales in 201
Slide 13: TMUS: Improvement in Branded Contract Losses
TMUS: 27% YOY IMPROVEMENT IN BRANDED CONTRACT LOSSES – ADJ. EBITDA IMPACTED BY HIGHER ADVERTISING AS EXPECTED Revenue and service revenue Net additions -9.2% 187 160 61 US-$ mn Total revenue in 000 -5.2% Service revenue Total net adds -205 -526 5,044 4,894 4,897 4,916 Branded: Q4/11 Q1/12 Q2/12 Q3/1
Slide 14: TMUS: MetroPCS Merger Approval Process on Track
TMUS: METROPCS MERGER APPROVAL PROCESS ON TRACK Definitive proxy filed on February 25 and MetroPCS shareholder meeting scheduled for April 12 MetroPCS PROCESS All other regulatory approval processes also on track Anticipate closing in H1/2013 Spectrum: 61 72 MHz in Top 100 major metro areas; 63
Slide 15: Europe: Pockets of Growth Slow Historical Revenue Decline
EUROPE: OUR POCKETS OF GROWTH CONTRIBUTE TO SLOWING DOWN THE HISTORICAL REVENUE DECLINE Revenue Pockets of growth – broadband and TV3 € mn -4.7% (-177) mn broadband accesses TV customers 3,772 -47 3,681 3,595 4.81 4.84 4.87 4.92 5.01 55 56 -86 -155 2.64 2.70 2.76 2.83 2.94 Q4/11 TMNL Trad. Growth F/
Slide 16: Europe: European Operations Outperform Competition in Revenue Development
EUROPE: EUROPEAN OPERATIONS OUTPERFORM COMPETITION IN REVENUE DEVELOPMENT ON THE MAIN MARKETS Commercial drive Key developments Revenue performance1 vs. main peers Refinancing OTE: OTE is refinanced well beyond 2014 due to measures conducted in Q4/12 (e.g. syndicated loan at global level) and in Q
Slide 17: Systems Solutions: Profitable Revenue Growth in Q4/12
SYSTEMS SOLUTIONS: PROFITABLE REVENUE GROWTH IN Q4/12 Revenue € mn +5.0% Increase in order entry by 87.9% to €3,622 driven by deals such as Market Unit 2,694 2,456 2,486 2,829 Shell, Presbyterian Healthcare (US), State of Lower Saxony 2,245 2,084 1,889 1,929 2,127 +2.1% Revenue up by 5.0% to €
Slide 18: Cash Flow: Delivered on Guidance
CASH FLOW: DELIVERED ON GUIDANCE Free cash flow full year Free cash flow Q4 € mn € mn 6,421 6,239 1,887 -631 423 26 -424 -209 -149 1,105 FY/11 Cash Capex Other FY/12 Q4/11 Cash Capex Other Q4/12 generated generated from from operations operations 18
Slide 19: Net Income 2012: Impairment in the US Major Driver
NET INCOME 2012: IMPAIRMENT IN THE US MAJOR DRIVER Net income full year 2012 € mn 2,851 2,529 -622 262 38 -7,439 934 -937 -342 -5,255 FY/11 Adj. EBIT Finance costs Other FY/12 Impairment Asset sales Restructuring Other FY/12 as adjusted adjusted US (net effect) (net effect) (net effect) reported 19
Slide 20: Net Debt: Reduction of €3.3 Billion
NET DEBT: REDUCTION OF €3.3 BILLION Net debt development full year 2012 € bn -3.3 (-8.1%) 40.1 -6.2 36.9 0.3 3.4 -1.9 0.4 0.8 Dec. 11 FCF Tower sales Pension Spectrum Dividend Other Dec. 12 funding (incl. F/X) 20
Slide 21: Balance Sheet: Maintaining Solid Ratios
BALANCE SHEET: MAINTAINING SOLID RATIOS € bn 31/12/2011 31/03/2012 30/06/2012 30/09/2012 31/12/2012 Balance sheet total 122.5 120.5 121.1 108.2 107.9 Shareholders equity 39.9 39.8 37.6 30.3 30.5 Net debt 40.1 38.6 41.0 39.0 36.9 Net debt/Adj. EBITDA1 2.1 2.1 2.2 2.1 2.1 Equity ratio 32.6% 33.0% 31.1
Slide 22: Q4 2012 Results Conference Call. Q&A.
DEUTSCHE TELEKOM: Q4 2012 RESULTS CONFERENCE CALL. Q&A. Questions can be asked via the telephone conference call: 0800 182 6766 0800 028 0471 +1 866 306 3455 +49 69 403 59 619. If you want to ask a question, please press “*1”. If you want to cancel your question, please press “#”. 22
Slide 23: Further Questions: Please Contact the IR Department
FURTHER QUESTIONS: PLEASE CONTACT THE IR DEPARTMENT Investor Relations, Bonn office Investor Relations, New York office Phone +49 228 181 - 8 88 80 Phone +1 212 424 2959 E-Mail investor.relations@telekom.de Phone +1 877 DT SHARE (toll-free) E-Mail investor.relations@telekom.com For further informati
Slide 24: Thank You!
THANK YOU!