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Bonn (pte024/03.03.2005/12:00) - German telecoms operator Deutsche Telekom http://www.telekom3.de has announced a swing to a fourth-quarter net profit amid continuing growth at the wireless and high-speed internet businesses, and has raised its 2005 forecast slightly. As the Wall Street Journal (WSJ) http://www.wsj.com reports, Europe's largest telecoms operator reported a net profit of 1.4 billion euros for the fourth quarter, compared to the net loss of 364 million euros it posted a year ago. Sales rose 2.8 per cent to almost 15 billion euros, while earnings before interest, tax, depreciation and amortisation adjusted for special items increased by 5.1 per cent to 4.7 billion euros.
According to the company, it will propose a 2004 dividend of 62 European cents a share, at the top of the range it unveiled in November. For the whole of 2004, the company's net profit increased to 4.6 billion euros from 1.3 billion euros, achieving the company's goal of continued profitable growth. Revenue rose 3.7 per cent to 57.9 billion euros. Organic revenue growth was 5.8 per cent. The increase was mainly due to the company's mobile communications sector and its broadband business. In 2004, Ebitda excluding special factors was 19.4 billion euros, compared with 18.3 billion euros in 2003. For 2005, Deutsche Telekom expects adjusted Ebitda, calculated in accordance with international financial reporting standards, to be between 20.7 billion euros and 21 billion euros.
In 2004, the company's operating results improved from 5.2 billion euros in 2003 to 6.9 billion euros. The considerable increase in net income resulted from the positive development of the operating results and the improvement in financial expenses. Net debt also decreased by 11.4 billion euros to 35.2 billion euros in 2004. This was achieved primarily due to free cash flow and the sale of investments, such as the sale of shares in Russian mobile operator Mobile TeleSystems. The group plans to invest between 7.5 billion euros and 8 billion euros in property, plant and equipment and expects to generate free cash flow in the same amount. Deutsche Telekom also expects additional cash outflows as a result of the acquisition of wireless licenses in the US and the reintegration of T-Online International.
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