Deutsche Telekom Ag · XETR:DTE
Deutsche Telekom — Q3 2024 Earnings Presentation
36 slides from Deutsche Telekom's earnings presentation, Nov 14, 2024
Slide 1: Deutsche Telekom Q3 2024 results
Deutsche Telekom Q3 2024 results November 14, 2024 Connecting your world
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: 9M 2024 results Group
9M 2024 results Group
Slide 4: 9M/24 consistent reliable growth
9M/24 consistent reliable growth 9M/2024 Highlights ▪ Market leading customer and financial growth continues: YTD organic service revenues +4.0%, adj. EBITDA AL +6.3%, FCF AL +28.3%1, adj. EPS +16.0%1 ▪ EU segment with 8.4% organic adj. EBITDA AL growth YTD ▪ FY24 guidance raised again. On both side
Slide 5: Financials 9M/24 organic strong organic growth
Financials 9M/24 organic strong organic growth 9M/24 Adj. EBITDA AL Adj. Core EBITDA AL 9M/24 Adj. EBITDA AL by segment2 9M/24 Key Financials growth yoy, organic growth of 8.4%1 € mn % growth yoy, organic TMUS 7.4% Group revenues 2.9% +€1,483 mn 7,859 Group service revenues 4.0% GER 2.5% +€192 mn ex
Slide 6: Networks leading with 5G, FTTH on track
Networks leading with 5G, FTTH on track FTTH (1 Gbps) 5G TMUS 5G DT ex US Fiber homes passed Ultra capacity 5G1 Germany mn +3.4 mn POPs % of POPs +3pp 19.0 300 >300 95 98 15.6 9.7 EU 8.7 GER 6.9 9.3 Q3/23 Q3/24 Q3/23 Q3/24 Q3/23 Q3/24 GER Network Leader GER • Fiber: On track for >10mn HHs by YE • La
Slide 7: Customers growing strongly
Customers growing strongly Mobile net adds Fixed line net adds2 000 4,080 4,133 000 US (postpaid) Broadband 468 274 9M/23 9M/24 9M/23 9M/24 1,444 1,462 Ex US (contract)1 TV 355 252 9M/23 9M/24 9M/23 9M/24 1 GER + EU. GER: own brand only. 2 GER + EU 7
Slide 8: Society and Environment: CMD shows progress with ESG ambitions
Society and Environment CMD shows progress with ESG ambitions Environment CO2e emissions (scope 1+2) kt -5% • Group energy consumption -3% yoy in 9M/24 and CO2 161.9 153.2 emissions (Scope 1&2) -5% US 35.1 33.4 • CMD 51% of DT Group Purchase Order Volume SBTi-aligned1 ex US 126.8 119.8 Society 9M/23
Slide 9: Guidance 2024 EBITDA AL outlook raised
Guidance 2024 EBITDA AL outlook raised for TMUS, DT ex US and DT group Adj. EBITDA AL1 TMUS DT Ex US FCF AL1 ~+6% € bn € bn ~+17% 40.6 ~42.9 ~42.9 ~43.0 +0.05 ~18.9 ~19.0 ~19.0 16.2 26.6 ~28.5 ~28.6 ~28.6 ~15.4 ~15.6 ~15.6 +0.05 12.9 14.0 14.4 14.4 14.5 +0.1 3.5 3.5 3.5 3.5 FY 2023 Guidance 2024 Gui
Slide 10: Q3 2024 results Review of segments and financials
Q3 2024 results Review of segments and financials
Slide 11: T-Mobile US industry leading financial growth
T-Mobile US industry leading financial growth Revenues (IFRS) Adj. EBITDA AL (IFRS)1 US$ bn US$ bn +4.8% +7.8% 19.2 20.1 3.4 7.4 8.0 Other revenues 3.3 Service revenues 15.9 16.7 Q3/23 Q3/24 Q3/23 Q3/24 Service revenue (US GAAP) Core adj. EBITDA (US GAAP) % yoy % yoy +12.2% +5.1% +9.1% +9.4% +8.9% +
Slide 12: T-Mobile US industry leading customer growth
T-Mobile US industry leading customer growth 5G EXTENDED RANGE Total postpaid net additions Industry leading Postpaid phone net additions Industry leading mn 000 1.6 1.6 850 934 865 1.2 1.2 1.3 777 532 Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 High Speed Internet net additions1 Ind
Slide 13: Germany 32nd consecutive quarter of EBITDA growth
Germany 32nd consecutive quarter of EBITDA growth Revenues (reported) Adj. EBITDA AL (reported) € mn € mn +2.5% +3.5% 6,308 6,465 2,638 2,731 Q3/23 Q3/24 Q3/23 Q3/24 Revenue growth (organic) Adj. EBITDA AL (organic) % yoy % yoy 3.6% 3.5% 3.0% 3.1% 3.0% 3.0% 2.6% 2.5% 2.1% 1.0% Q3/23 Q4/23 Q1/24 Q2/2
Slide 14: Germany total service revenues: steady growth
Germany total service revenues: steady growth Total service revenue growth (organic) Mobile service revenue growth (organic) Sequential % yoy % yoy 3.7% slowdown due to 3.2% 3.4% tougher y/y comps 2.9% 2.4% 2.2% 2.1% 2.1% 1.8% 1.8% Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 Revenue
Slide 15: Germany fixed revenues: improvement in retail and wholesale access
Germany fixed revenues: improvement in retail and wholesale access Retail fixed revenues (reported) Broadband revenue growth (organic) Q2 and Q3 Impacted € mn % yoy by prior year phasing +2.6% 5.0% 3,300 4.0% 4.2% 4.0% 3,218 3.3% Broadband revenues +3.3% 1,815 1,875 Single play and other revenues 1,
Slide 16: Germany fixed KPIs: broadband growth steady, TV and FTTH faster
Germany fixed KPIs: broadband growth steady, TV and FTTH faster Broadband net adds TV net adds (ex OTT) In addition, OTT with 000 000 0.3 mn net adds YTD 114 96 66 68 73 76 41 51 39 38 Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 Retail customers with ≥100 Mbit/s tariff FTTH net adds
Slide 17: Germany mobile KPIs: strong customer intake
Germany mobile KPIs: strong customer intake in a competitive market Branded contract net adds1 Data usage2 000 GB per month 350 327 289 311 14.3 281 12.1 +18% yoy Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 Q3/23 Q3/24 Churn2 Magenta EINS share (mobile)3 % % 0.9% 0.9% 65% 64% Q3/23 Q3/24 Q3/23 Q3/24 1 Own branded
Slide 18: Europe 27th consecutive quarter of organic EBITDA growth
Europe 27th consecutive quarter of organic EBITDA growth Revenues (reported) Adj. EBITDA AL (reported) € mn +3.9% € mn 3,110 +7.7% 2,995 1,095 1,180 Q3/23 Q3/24 Q3/23 Q3/24 Revenues (organic) Adj. EBITDA AL (organic) % growth yoy % growth yoy 8.9% 8.1% 8.0% 6.8% 5.6% 5.7% 3.7% 4.2% 4.1% 3.3% Q3/23 Q
Slide 19: Europe strong commercial performance continues
Europe strong commercial performance continues Mobile contract net adds Broadband net adds 000 246 000 223 184 183 176 76 76 57 53 47 Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 FMC net adds TV net adds 000 000 195 167 152 143 52 37 41 28 23 36 Q3/23 Q4/23 Q1/241 Q2/24 Q3/24 Q3/23 Q4
Slide 20: Systems Solutions growth in order entry, revenue, and profitability
Systems Solutions growth in order entry, revenue, and profitability Order entry (LTM) Revenues (reported) Adj. EBITDA AL (reported) € bn € mn € mn +17.9% +3.3% 4.0 960 991 +18.9% 3.4 86 102 Q3/23 Q3/24 Q3/23 Q3/24 Q3/23 Q3/24 • Order entry growth mainly driven by cloud Revenues (organic) Adj. EBITDA
Slide 21: Financials Q3/24 reported strong set of results
Financials Q3/24 reported strong set of results across the board € mn Q3 9M 2023 2024 Change 2023 2024 Change 9M/23 benefitted from Revenue 27,556 28,501 +3.4% 82,616 84,838 +2.7% gains in asset sales e.g. Service revenues 23,258 24,127 +3.7% 69,025 71,700 +3.9% Towers Adj. EBITDA AL 10,486 11,096 +
Slide 22: FCF AL and adj. net profit
FCF AL and adj. net profit FCF reflecting growth in EBITDA and lower capex in the US Free Cash Flow AL1 Adj. net profit € mn € mn +32.0% 6,189 +3.0% 7 38 -87 461 -246 615 -57 1,120 2,268 -284 2,335 4,688 Lower capex post merger in the US Growth in EBITDA AL Q3/23 Net CF Leasing Capex (excl. Others Q
Slide 23: Net debt leverage ratio below 2.75x guardrail
Net debt leverage ratio below 2.75x guardrail Net debt excl. leases (AL) Leverage ratios € bn X Incl. Leases -4.6 97.1 Excl. Leases 3.07 0.0 2.94 0.5 2.82 -6.2 0.5 0.5 -2.1 2.58 2.64 92.5 2.40 2.2 2.31 2.18 Q2/24 FCF AL Spectrum Dividends SBB TM US DT SBB TM US F/X and Q3/24 2022 9M/23 2023 9M/24 sh
Slide 24: Q3 2024 results Main takeaways
Q3 2024 results Main takeaways
Slide 25: 9M/24 Key messages consistent reliable growth
9M/24 Key messages consistent reliable growth Adj. EPS in €/share ~2.5 ▪ Ongoing strong commercial and financial performance ▪ 2024 adj. EBITDA AL guidance raised on both sides of the Atlantic >1.75 ▪ Earnings growth to continue, at >11% 2023 – 2027 CAGR, as per 1.60 CMD 2024 ▪ Back below 2.75x leve
Slide 26: Q3 2024 results Appendix
Q3 2024 results Appendix
Slide 27: Organic growth rates
Organic growth rates In % Q3/24 over Q3/23 9M/24 over 9M/23 Group revenues +3.6 +2.9 Group service revenue +3.8 +4.0 Service revenue excl. US +3.0 +3.5 Group Adj. EBITDA AL +6.4 +6.3 Adj. EBITDA AL excl. US +4.3 +4.1 Group adj. Core EBITDA AL1 +6.7 +6.9 1 adj. EBITDA AL excl. TMUS handset leases. In
Slide 28: TMUS EBITDA reconciliation
TMUS EBITDA reconciliation 9M/24 Q3/24 US$ mn US$ mn +8.8% yoy +7.9% yoy 23,866 23,948 +8.1% yoy +9.4% yoy +8.6% yoy +7.8% yoy 82 -669 23,279 8,222 8,243 7,962 21 -281 Adj. Core Leasing Adj. EBITDA Bridge Adj. EBITDA Adj. Core Leasing Adj. EBITDA Bridge Adj. EBITDA EBITDA Revenues (US GAAP) AL (IFRS
Slide 29: FCF AL excl. US full year 2024 guidance unchanged
FCF AL excl. US1 full year 2024 guidance of €3.5 bn unchanged € bn 9M 2023 9M 2024 Adj. EBITDA 11.7 12.1 FY Guidance €14.5 bn Leasing opex -1.1 -1.1 Adj. EBITDA AL 10.6 11.0 Cash Capex -5.7 -5.8 Proceeds from sale of fixed assets +0.0 +0.1 Special Factors Cash -0.7 -0.8 Interest ex leasing -0.6 -0.7
Slide 30: Financials maturity profile covered by strong liquidity reserve
Financials maturity profile covered by strong liquidity reserve Ex US debt maturing Ex US liquidity position Credit lines € bn € bn Liquid assets 15.4 3.6 12.0 2.2 Ø 2.15 2.1 4.9 1.3 1.5 1.5 3.4 1.3 2024 2025 2026 2027 Liquidity Maturities Maturities Maturities Total reserve Q4 2024 2025 Q1-Q3 2026
Slide 31: Balance sheet leverage below guardrail
Balance sheet leverage below guardrail € bn 30/09/2023 31/12/2023 31/03/2024 30/06/2024 30/09/2024 Balance sheet total 302.5 290.3 295.2 296.0 288.6 Shareholders’ equity 96.6 91.2 93.2 92.4 92.4 Net debt excl. leases (AL) 96.9 93.7 94.5 97.1 92.5 Net debt excl. leases (AL)/adj. EBITDA AL1 2.40 2.31
Slide 32: Guidance 2024 compared to consensus
Guidance 2024 compared to consensus € bn Guidance 2024 in € Guidance 2024 in € Consensus in € @ 1.08 @ 1.09 (Cons. f/x) @ 1.09 Adj. EBITDA AL Group ~43.0 ~42.8 43.0 thereof ex US 14.5 14.5 14.5 thereof TMUS ~28.6 ~28.3 28.4 FCF AL ~19.0 ~19.0 18.9 thereof ex US ~3.51 ~3.51 3.6 thereof TMUS ~15.6 ~15
Slide 33: Outlook 2024/25 as per annual report 2023 (1/2)
Outlook 2024/25 as per annual report 2023 (1/2)1 € bn 2023 pro forma 2024e 2025e Revenue Group 112.2 Increase Increase Germany 25.2 Slight increase Slight increase US (in US$) 78.6 Increase Increase Europe 11.8 Slight increase Slight increase Systems Solutions 3.9 Slight increase Stable Service Revs
Slide 34: Outlook 2024/25 as per annual report 2023 (2/2)
Outlook 2024/25 as per annual report 2023 (2/2)1 € bn 2023 pro forma 2024e 2025e Cash Capex Group 16.6 ~15.9 Stable Germany 4.6 Slight increase Slight increase US (in US$) 9.8 Decrease Stable Europe 1.8 Slight increase Slight increase Systems Solutions 0.2 Stable Stable FCF AL Group 16.2 ~18.9 Stron
Slide 35: Investor + Analyst Webcast with Q&A session
Investor + Analyst Webcast with Q&A session The conference call will be held on November 14 at 14:00 CET, 13:00 GMT, 08:00 EST, 05:00 PST, 22:00 JST DT Participants: Christian Illek (CFO), Hannes Wittig (Head of IR) • Detailed time stamps in video description for slides + Q&A: • Live webcast Christi
Slide 36: Further questions please contact the IR department
Further questions please contact the IR department Homepage: +49 228 181 – 8 88 80 Individual contact details for www.telekom.com/investors all IR representatives: investor.relations@telekom.de www.telekom.com/ircontacts Investor relations on social media – Follow us to stay up to date! linkedin.com