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Deutsche Telekom reports 4th-quarter loss of euro757 million

Deutsche Telekom reports 4th-quarter loss of euro757 million

Deutsche Telekom AG on Thursday posted another quarterly loss but said that its business was stabilizing after many quarters of declines caused by an exodus of fixed-line customers.
The Bonn-based company lost euro757 million (US$1.1 billion) in the October-December period, narrowing its loss of euro898 million a year earlier.
Fourth-quarter sales were about half a percent lower at euro15.8 billion (US$23.7 billion), compared with euro15.9 billion a year earlier.
However, the company said that its adjusted net profit for the fourth quarter was euro808 million (US$1.2 billion) _ about 2 percent lower than the euro824 million it earned a year earlier, but above the euro609 million (US$916.2 million) that analysts polled by Dow Jones Newswires had forecast.
That figure does not include the euro1.4 billion (US$2.1 billion) it spent in shedding jobs and paying out early retirement figures.
The company is in the midst of cutting 32,000 jobs as it works to streamline its operations in order to better compete with rivals in Europe, the United States and elsewhere.
The performance helped push the company's shares higher to euro13.07 (US$19.66), or up 1.2 percent, in Frankfurt trading.
Deutsche Telekom said the improvement was mainly attributable to cost savings of euro2.3 billion (US$3.5 billion) in its "Save for Service" program, aimed at improving customer service. Some of the proceeds from that program were being used to improve the group's market positioning, mainly in Germany.
The company said that, for example, it succeeded in increasing its new customer retail market share in the German broadband business by 44 percent, compared with 18 percent in 2006. It added 962,000 new contract customers at the German arm of the mobile communications business, T-Mobile, compared with 797,000 in the previous year.
For 2007 as a whole, Deutsche Telekom's net profit fell to euro569 million (US$856 million) from euro3.2 billion in 2006, mostly because of an increase in income taxes, according to the company.
Sales for the year were up 1.9 percent to euro62.5 billion (US$94 billion) from euro61.3 billion in 2006.
The company attributed annual sales growth to its mobile communications business, which climbed 8.4 percent to euro34.7 billion (US$52.2 billion). International sales were up 10.2 percent to euro31.8 billion (US$47.8 billion), accounting for nearly 51 percent of total sales.
Telekom had said earlier in the year that approximately 2.1 million fixed-lines, or traditional telephone lines, were lost in Germany in 2007, 537,000 of which were in the fourth quarter _ the same level as last year.
As for 2008, Telekom said it expects the group to maintain adjusted earnings before interest, taxes, depreciation and amortization at around euro19.3 billion (US$29 billion), and its free cash flow at around euro6.6 billion (US$9.9 billion), on a par with the 2007 financial year.
Deutsche Telekom said Wednesday evening that the company will propose a dividend of 78 euro cents (US$1.17) a share for 2007, up more than 8 percent from the previous year's level of 72 euro cents.
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On the Net:
http://www.telekom.de


Updated : 2021-04-15 16:58 GMT+08:00