Selected financial data of the Group - Deutsche Telekom Annual Report 2021 (2024)

• Net revenue increased by 7.7% to EUR108.8billion. In organic terms, too, revenue increased by EUR4.7billion or 4.5%. Service revenue increased by EUR5.2billion or 6.5% to EUR84.1billion.
• Our United States segment recorded revenue growth of 11.7%. In organic terms, revenue increased by 5.8% year-on-year due to higher service and terminal equipment revenues.
• In our Germany and Europe segments, we increased revenue by 1.6% and 0.4% respectively, on account of strong business performance. In organic terms, revenue in Europe was up by as much as 2.4%.
• Revenue in our Systems Solutions segment decreased year-on-year by 3.4%, due primarily to the decline in traditional IT infrastructure business, in line with expectations.
• In the Group Development segment, revenue increased by 9.8% year-on-year on the back of operational and structural growth at T‑Mobile Netherlands and GDTowers. In organic terms, revenue increased by 4.6%.

• Adjusted EBITDAAL grew by 6.6% to EUR37.3billion with all operating segments contributing to this positive trend. In organic terms, our adjustedEBITDAAL increased by EUR0.7billion or 1.9%.
• Adjusted EBITDAAL rose sharply by 8.1% in the United States, in part as a result of the business combination with Sprint. In organic terms, adjustedEBITDAAL remained on a par with the prior-year level. Adjusted core EBITDAAL, which we use as an indicator of earnings not distorted by the negative effects of the planned withdrawal from the terminal equipment lease model, increased by EUR2.5billion or 14.7%.
• Germany and Europe posted growth in adjustedEBITDAAL of 3.6% and 2.5% respectively, driven by high-value revenue growth and enhanced cost efficiency.
• In our Systems Solutions segment, adjustedEBITDAAL grew by 2.5%. Efficiency effects from our transformation program and increased revenue in the growth areas exceeded the decline in the traditional IT infrastructure business.
• Group Development posted substantial growth in adjustedEBITDAAL of 18.7%. This was driven primarily by revenue growth at T‑Mobile Netherlands and GDTowers, and efficient management of costs.
• At 34.3%, the Group’s adjustedEBITDAAL margin decreased slightly against the prior-year level. The margin was 39.4% in Germany, 35.2% in Europe, and 33.2% in the United States.

• EBIT increased by EUR0.3billion or 2.0% to EUR13.1billion.
• EBITDAAL was negatively affected by special factors of EUR3.4billion compared to expenses of EUR1.8billion in the prior year. Expenses of EUR2.6billion were recorded in connection with the business combination of T‑MobileUS and Sprint. These related to acquisition and integration costs, as well as the restructuring costs for realizing cost efficiencies. The sale of the Dutch cell tower business resulted in a gain on deconsolidation of EUR0.2billion. Expenses in connection with staff restructuring measures were down year-on-year by EUR0.6billion. Reversals of impairment losses of EUR1.7billion had been recognized in the prior year and mainly related to the partial reversal of impairment losses on spectrum licenses at T‑MobileUS, which increased the carrying amount.
• Depreciation, amortization, and impairment losses were EUR1.7billion higher than in the prior year due in particular to the first-time inclusion of Sprint for the full year. The reduction in the useful life of leased network technology for cell sites resulted in an increase in depreciation and amortization of EUR0.8billion.

• Net profit remained stable at EUR4.2billion.
• Loss from financial activities increased by EUR1.0billion to EUR5.1billion, partly in connection with an increase in finance costs due to the assumption of Sprint’s financial liabilities. Other financial income/expense decreased by EUR0.5 on a net basis in connection with the measurement of derivatives and the measurement of provisions and liabilities.
• Tax expense came to EUR1.8billion compared with EUR1.9billion in the prior year.
• Profit attributable to non-controlling interests decreased by EUR0.7billion to EUR1.9billion.
• Adjusted earnings per share amounted to EUR1.22 compared with EUR1.20 in the prior year.

• Net debt increased by EUR11.9billion to EUR132.1billion compared with the end of 2020.
• This increase was attributable in particular to the acquisition of spectrum (EUR8.4billion), primarily in the United States; exchange rate effects (EUR6.9billion); and additions of lease liabilities (EUR5.3billion). Dividend payments – including to non-controlling interests– (EUR3.1billion) and the acquisition of Shentel (EUR1.9billion) further increased net debt.
• Free cash flow of EUR14.3billion had a reducing effect.

• Cash capex (before spectrum investment) increased by EUR1.0billion to EUR18.0billion.
• This increase is largely attributable to the first-time inclusion of Sprint for the full year and the ongoing 5G network build-out in the United States. In Germany and Europe we continued to invest in the provision of broadband and fiber-optic technology and in 5G as part of our integrated network strategy.
• Cash capex (including spectrum investment) increased by EUR7.7billion to EUR26.4billion. In the reporting year, the United States segment acquired FCC spectrum licenses for a total amount of EUR8.3billion. Another EUR0.1billion was paid for spectrum in the Europe segment. The prior-year figure included EUR1.7billion for the acquisition of mobile spectrum licenses, which primarily related to the United States, Europe, and Group Development segments.

• Free cash flowAL (before dividend payments and spectrum investment) increased by EUR2.5billion year-on-year to EUR8.8billion.
• Net cash from operating activities increased by EUR4.7billion. This was attributable in particular to the sustained positive performance of the operating segments, especially in the United States including Sprint.
• Apart from the EUR1.0billion higher cash capex (before spectrum investment), the increase was partially offset in particular by an advance payment for the lease of cell sites made by T‑MobileUS in September2021 and higher interest payments, mainly as a result of the financial liabilities assumed and the restructuring carried out in connection with the acquisition of Sprint, and the related increase in financing. Higher income tax payments also had an increasing effect on free cash flowAL.

• Return on capital employed (ROCE), which continues to be impacted by the integration costs in connection with the business combination with Sprint, decreased by 0.5 percentage points to 4.1%. This was due to stronger percentage growth in average operating assets (NOA) than in net operating profit after taxes (NOPAT).
• The increase in NOA was mainly driven by the acquisition of additional spectrum licenses at T‑MobileUS and our consistently high investment volume.
• NOPAT was up slightly year-on-year. This development is largely attributable to higher integration costs in connection with the business combination of T‑MobileUS and Sprint. In the prior year, NOPAT had been positively affected by the partial reversal of impairment losses on spectrum licenses, which had increased the carrying amount.

5G

New communications standard (launched from 2020), which offers data rates in the gigabit range, converges fixed-network and mobile communications, and supports the Internet of Things.

Glossary

AL – After Leases

Since the start of the 2019 financial year, we have taken the effects of the first-time application of IFRS 16 “Leases” into account when determining our financial performance indicators. “EBITDA after leases” (EBITDA AL) is calculated by adjusting EBITDA for depreciation of the right-of-use assets and for interest expenses on recognized lease liabilities. When determining “free cash flow after leases” (free cash flow AL), free cash flow is adjusted for the repayment of lease liabilities.

Glossary