Deutsche Telekom Ag · XETR:DTE

Deutsche Telekom — FY2011 Earnings Presentation

34 slides from Deutsche Telekom's earnings presentation, Feb 23, 2012

  1. Slide 1: Q4/11 – Results Presentation

    Q4/11 – Results Presentation. For smartphone and tablet users: just scan the QR-code and Deutsche Telekom. download this presentation February 23, 2012

  2. 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

  3. Slide 3: Agenda

    Agenda. Deutsche Telekom Results Presentation. René Obermann CEO Timotheus Höttges CFO Philipp Humm CEO T-Mobile USA 3

  4. Slide 4: FY 2011 results and outlook

    FY 2011 results and outlook. Life’s for Sharing wa Pec ec ee cece cece cee eeceeseeceesueteesees

  5. Slide 5: FY 2011: Highlights

    FY 2011: Highlights.  Group revenue of €58.7 billion (-2.5% underlying)1  Targets achieved with €18.7 billion of adj. EBITDA and €6.4 billion of free cash flow Group  Net profit of €0.6 billion impacted by exceptional write-offs  Dividend of €0.70 proposed to AGM  Save for Service target overac

  6. Slide 6: FY 2011 Guidance achieved

    FY 2011 Guidance achieved. FY Guidance and achievement in 2011 (€ billion) Adj. EBITDA FCF ~19.1 18.9 0.2 F/X impact1 14.9 14.9 Min. 6.5 6.5 0.1 F/X impact1 18.7 Dividend of €0.70 per share or € 3 billion in total 6.4 comfortably covered by free cash flow (pay out ratio of 47%) Group ex. US Group in

  7. Slide 7: 2011 Key financials

    2011 Key financials. € million Q4/10 Q4/11 change in % FY/10 FY/11 change in % Underlying revenue1 15,477 15,129 -2.2% 61,663 60,102 -2.5% Revenue 15,477 14,911 -3.7% 62,421 58,653 -6.0% Adj. EBITDA 4,550 4,611 1.3% 19,473 18,685 -4.0% Adj. net profit 758 -92 n.a. 3,364 2,851 -15.2% Net profit -514

  8. Slide 8: FY 2011 Growth Areas

    FY 2011 Growth Areas. Ambition Deutsche Telekom growth areas1 FY/10 FY/11 Change 2015 Revenue (€ billion) Mobile internet 4.4 5.2 0.8 18% ≈ 10 Connected Home2 6.2 6.3 0.1 1.7% ≈7 thereof GER 5.1 5.3 0.2 2.4% Online consumer services3 0.9 0.9 0.0 -1.8% 2-3 T-Systems external revenue4 6.4 6.5 0.1 1.2%

  9. Slide 9: Outlook 2012

    Outlook 2012.  Adj. EBITDA around € 18 billion (based on constant currency) Guidance 20121  Free cash flow around € 6 billion  Execute on challenger strategy in the US, committed to solve long-term strategic challenges  Maintain market leadership and stabilize underlying adj. EBITDA in Germany 

  10. Slide 10: Q4 2011 results operational overview

    Q4 2011 results operational overview.

  11. Slide 11: Q4/11 Overview

    Q4/11 Overview. Revenue (€ million) Adj. EBITDA (€ million) -3.7% 1.3% 15,477 14,911 4,550 4,611 -81 -485 -28 89 Q4/10 F/X Organic Q4/11 Q4/10 F/X Organic Q4/11 Revenue Q4/10 vs. Q4/11 (€ million) Adj. EBITDA Q4/10 vs. Q4/11 (€ million) 6,442 Germany 2,358 Germany 2,286 6,047 USA 1,000 USA 3,942 1,0

  12. Slide 12: Germany: further improved EBITDA margin – revenue not satisfying

    Germany: further improved EBITDA margin – revenue not satisfying. Revenue (€ million) Adj. EBITDA (€ million) -6.1% -3.1% 6,442 5,991 5,989 6,004 6,047 2,358 2,384 2,439 2,490 2,286 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Adj. opex (€ million) Adj. EBITDA margin (in %) -8.1% 41.5

  13. Slide 13: Germany revenue: continued focus on data & TV opportunity

    Germany revenue: continued focus on data & TV opportunity. Fixed network revenues (€ million)1 Mobile service revenue2 (€ million) -7.8% +0.4% 4,376 4,063 4,045 4,027 4,035 1,756 1,747 1,767 1,815 1,763 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 2play + 3play customers (million) Mob

  14. Slide 14: Germany: #1 in broadband and mobile service revenue

    Germany: #1 in broadband and mobile service revenue. Broadband access lines (million) and market share1  Line losses 21% below last year: 295k in Q4. (373k in Q4/10) 46.1% 45.8% 45.7%  Broadband customers +3%: 12,265k, 64k net adds in Q4 45.5% 45.3%  Entertain customers +34%: 1,553k total, 177k n

  15. Slide 15: Germany: network roll-out and successful positioning

    Germany: network roll-out and successful positioning. Mobile network population coverage and fiber link-up Successfully re-vitalized Service Provider segment Net Adds contract in k. 99% 99% 83% 86% 73% 83% DT Service Provider 1.048 268 14% 780 1% 327 -357 2G coverage 3G coverage LTE coverage % of 3G

  16. Slide 16: Europe – growth in key market KPIs

    Europe – growth in key market KPIs. TV customer (million) Smartphone share1 +12% +59% 2.59 2.62 2.64 50% 54% 2.35 2.41 46% 43% 0.71 0.73 0.77 0.81 34% 0.65 IPTV IPTV +24% +24% Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Broadband accesses (million)2 Mobile contract subscriber (millio

  17. Slide 17: Europe – integrated markets: focus on robust margins

    Europe – integrated markets: focus on robust margins in difficult environment. Greece: Revenue (€ million) -7%  Q4 with strongest adj. EBITDA performance in year 2011, margin -10% increased yoy by 1.2pp -5% 0% 937 867  Strong position in declining mobile market 407 368  Sale of 20% stake in Telek

  18. Slide 18: Europe – mobile centric: economy and regulation impact revenue

    Europe – mobile centric: economy and regulation impact revenue. Poland: Revenue (€ million)  Q4/11 revenue significantly impacted by F/X losses (-€47 million) -14% +9% Underlying revenue (excl. MTR cut and F/X) -2.1% -7% -2%  Underlying EBITDA (excl. MTR cut and F/X) -8% due to higher release of 4

  19. Slide 19: Systems Solutions: revenue growth of 2.1% in FY 2011

    Systems Solutions: revenue growth of 2.1% in FY 2011. Revenue (€ million)  Full year revenue growth (+2.1%) in 2011 due to successful closed deals in 2010 and 2011 and increasing External Revenues Internal Revenues revenues with cloud computing  Revenue decrease of 0.9%yoy to €2,457million in Q4/1

  20. Slide 20: Q4 2011 results financial overview

    Q4 2011 results financial overview.

  21. Slide 21: Free cash flow – delivered on target

    Free cash flow – delivered on target. Free cash flow Q4/11 vs. Q4/10 (€ million) Free cash flow FY/11 vs. FY/10 (€ million) 1,887 6,543 6,421 37 406 12 1,733 272 374 257 FCF Q4/10 Net cash from Capex1 Others FCF Q4/11 FCF FY/10 Net cash from Capex1 Others FCF FY/11 operations operations 1) Adj. for

  22. Slide 22: Save for Service: €4.2 billion target overachieved

    Save for Service: €4.2 billion target overachieved one year ahead of schedule. Cost base development FY/10 vs. FY/11 (€ billion) Contribution FY/2011 by Business Unit (€ million) Realized -6.8% 44.41 Germany 450 0.60 USA 458 0.54 Europe 405 Systems Solutions 709 2.10 GHS 74 41.39 0.21 DT Group 2.095

  23. Slide 23: Net income development FY 2011: Special factors

    Net income development FY 2011: Special factors. Net income FY 2011 (in € million) US$ 3 billion cash US$ 1.2 billion spectrum 2,851 2,297 3,000 1,683 1,040 46 557 641 321 Adjusted Restructuring Breakup Impairment US Impairment Special factors Tax effect on Special factors Net profit net profit expe

  24. Slide 24: Net debt reduced by over € 2 billion in FY 2011

    Net debt reduced by over € 2 billion (-5.1%) in FY 2011. Net debt FY 2011 (in € billion) 42.3 0.8 0.4 0.1 0.3 2.3 40.1 6.4 1.4 3.5 Net debt 2010 Others Free cash flow Dividends PTC OTE put Spectrum Pension Breakup fee Net debt 2011 (incl. f/x) settlement option invest funding 24

  25. Slide 25: Balance sheet ratios: improved net debt over EBITDA ratio and gearing

    Balance sheet ratios: improved net debt over EBITDA ratio and gearing in Q4. in € billion 31/12/2010 31/03/2011 30/06/2011 30/09/2011 31/12/2011 Balance sheet total 127.8 123.2 123.1 124.6 122.5 Shareholders’ equity 43.0 42.7 39.3 40.7 39.9 Net debt 42.3 41.8 43.3 43.4 40.1 Net debt/adj. EBITDA1 2.2

  26. Slide 26: T-Mobile US – 2011 results and outlook

    T-Mobile US – 2011 results and outlook

  27. Slide 27: Strong EBITDA and prepaid performance, contract hit by iPhone launch

    Strong EBITDA and prepaid performance, contract negatively impacted in Q4 by iPhone launch. Service revenues (US$ million) Net adds (‘000)1 Prepay Contract -4.4% 229 283 231 312 276 4,615 4,556 4,543 4,525 4,413 -251 -186 -281 -382 -802 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Adj

  28. Slide 28: Reinvigorating the Challenger strategy

    Reinvigorating the Challenger strategy. Mission: Making Amazing 4G Services Affordable Amazing 4G Value Multi-Segment Challenger Trusted Brand Services Leader Player Business Model 2012/  LTE  Brand relaunch  Distribution  B2B Invest  Reinvent v2 2013 push  MVNE platform  Churn v2 2011  Amer

  29. Slide 29: $1.4B incremental capex in the network to launch LTE in 2013

    $1.4B incremental capex in the network in 2012/2013 to launch LTE in 2013. l tottaal $$44B B tomeenntt Modernize 37K sites in 2012/2013 Repurposing existing spectrum usage s tm iinnvveest Average spectrum holdings in Top 100 markets Active Antennas (Mhz) Illustrative 50% of 4G POPs to have 20MHz LTE

  30. Slide 30: Relaunch T-Mobile brand to Best Value in Wireless

    Relaunch T-Mobile brand to Best Value in Wireless. Strengthen wireless purchase key drivers Repositioning T-Mobile in Q3 2012 Key Drivers of Wireless Purchase for Postpaid  Making amazing 4G services affordable Customers – Percent  Driving technology attributes through 4G services, 4G devices and

  31. Slide 31: Capture a bigger share of the $60B B2B segment

    Capture a bigger share of the $60B B2B segment. B2B Segment B2B Key Measures  Grow B2B sales force +1000 FTEs $175B = 100%  Leverage DT footprint for better international offers  New B2B rate plans B2B/MBB 35% 12% market 5% share market share 64% B2C 1% (individual MVNO liable) Source: Nielsen Su

  32. Slide 32: T-Mobile USA summary

    T-Mobile USA summary.  T-Mobile is back with its Challenger strategy  LTE in 2013  B2B investments  Brand relaunch in Q3  2012 adj. EBITDA expected to be ~$4.8B  Mid-term target: Return to subscriber and adj. EBITDA growth  Strategic options considered to strengthen T-Mobile USA’s capital str

  33. Slide 33: Q&A – Please press *1 to ask a question

    Q&A – Please press “*1” to ask a question. René Obermann CEO Timotheus Höttges CFO Philipp Humm CEO T-Mobile USA For remaining questions please contact the IR department after the call. 33

  34. Slide 34: Investor Relations contact – Thank you for your attention

    For 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 Fax +49 228 181 - 8 88 99 Phone +1 877 DT SHARE (toll-free) E-Mail investor.relations@telekom.de Fax +1 212 424 2977 E-Mail in

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