Deutsche Telekom Q2 Profit Climbs; Backs FY19 Outlook

German telecom giant Deutsche Telekom AG (DTEGY.PK) reported Thursday a significant growth in second-quarter net profit with higher revenues as well as the absence of prior year’s charge. Looking ahead, the company said it stays well on track.

Tim Höttges, CEO of Deutsche Telekom, said, “We remain reliable. Our business performed well in all areas again in the first half of 2019. That puts us in a position to deliver the results we promised.”

The company previously said it expects fiscal 2019 adjusted EBITDA AL of around 23.9 billion euros, compared to last year’s pro forma 23.2 billion euros, and revenues to grow slightly from 76.4 billion euros. Excluding US, annual adjusted EBITDA AL was expected to be around 13.4 billion euros.

For the second quarter, net profit surged 90.7 percent to 944 million euros from last year’s 495 million euros. The growth mainly reflected the absence of prior year’s negative special factor from the settlement in the Toll Collect arbitration proceedings.

Adjusted for special factors, net profit was 1.33 billion euros, compared to 1.24 billion euros a year ago.

EBITDA for the quarter grew 20.6 percent to 6.70 billion euros, and adjusted EBITDA climbed 22.5 percent from last year to 7.26 billion euros. Adjusted EBITDA AL went up 7.1 percent to 6.28 billion euros.

Net revenue increased 7.1 percent to 19.66 billion euros from last year’s 18.37 billion euros.

In the Germany operating segment, revenue increased 1.2 percent from last year to 5.4 billion euros, and adjusted EBITDA AL grew 2.4 percent to 2.2 billion euros.

In the United States, T-Mobile US’ revenue increased 5.1 percent year-on-year to $11 billion, with service revenue growth of 6.9 percent to $8.3 billion. Adjusted EBITDA AL increased 6 percent to $3.2 billion. T-Mobile US recorded 1.8 million net customer additions in the quarter, bringing the total customer count to 83.1 million at the end of June.

In Germany, Deutsche Telekom shares were trading at 14.56 euros, down 0.42 percent.

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