Financial position of Deutsche Telekom AG

In addition to shareholders’ equity, our financial position is mainly determined by noncurrent assets as well as by receivables from and payables to Group companies. Loans recognized under financial assets as well as receivables from and payables to affiliated companies primarily resulted from financing relationships between Deutsche Telekom AG and its subsidiaries.

The balance sheet total increased by EUR 0.1 billion year-on-year to EUR 116.9 billion.

The development of total assets was attributable in particular to the increase of EUR 5.2 billion in financial assets and the increase of EUR 0.6 billion in other assets. By contrast, receivables decreased by EUR 3.0 billion and cash and cash equivalents by EUR 2.7 billion.

Financial assets increased year-on-year by EUR 5.2 billion, due primarily to an intragroup restructuring of current receivables from cash management from Telekom Deutschland GmbH, Bonn, in the amount of EUR 5.0 billion to noncurrent loans. Other factors contributing to the increase were the acquisition of shares in T‑Mobile US, Inc, Bellevue (EUR 0.6 billion), a capital increase at Digital Infrastructure Vehicle II SCSp SICAV-RAIF, Senningerberg, a fund company established in the reporting year (EUR 0.3 billion), and an increase in loans to OTE Plc, London (EUR 0.2 billion). In particular a loan repayment by T‑Mobile USA, Inc., Bellevue, in the amount of EUR 0.8 billion had an offsetting effect.

The decrease in receivables of EUR 3.0 billion resulted primarily from EUR 1.8 billion lower receivables from cash management, mainly due to an intragroup restructuring of current receivables from cash management from Telekom Deutschland GmbH, Bonn, to noncurrent loan receivables. The capital repayment by T‑Mobile Global Holding GmbH, Bonn, had an offsetting effect on receivables from cash management. The decrease of EUR 1.1 billion in financial receivables from affiliated companies, mainly from the repayment of short-term loans by Deutsche Telekom Europe B.V., Maastricht, further reduced receivables.

The increase of EUR 0.6 billion in other assets is primarily due to higher receivables from collateral. The change in receivables from collateral is attributable to regular fluctuation in market values.

The development of total shareholders’ equity and liabilities was mainly influenced by the increase of EUR 1.4 billion in shareholders’ equity. By contrast, financial liabilities decreased by EUR 0.8 billion and other liabilities by EUR 0.7 billion.

The increase in shareholders’ equity of EUR 1.4 billion was primarily attributable to income after taxes of EUR 3.6 billion in the 2021 financial year as well as a capital increase of EUR 0.6 billion. The dividend payment of EUR 2.8 billion for the previous year had an offsetting effect.

Financial liabilities decreased to EUR 10.2 billion, down by EUR 0.8 billion compared to the prior year. The EUR 1.0 billion decline in liabilities to banks accounted for a large share of this decrease. Bonds issued in the reporting year had an offsetting effect of EUR 0.2 billion.

Remaining liabilities decreased by a total of EUR 0.7 billion year-on-year, due mainly to the decrease of EUR 3.7 billion in financial liabilities to affiliated companies, particularly as a result of loan repayments of EUR 2.6 billion to Deutsche Telekom International Finance B.V., Maastricht, and of EUR 1.2 billion to T‑Mobile Austria Holding GmbH, Vienna. Furthermore, other liabilities decreased by EUR 0.4 billion, EUR 0.3 billion of which were attributable to liabilities from early retirement arrangements for civil servants. By contrast, current liabilities from cash management increased by EUR 3.3 billion as a result of payments received by subsidiaries that were transferred to Deutsche Telekom AG in connection with the intragroup cash management system.

Net cash provided by/used for operating activities changed year-on-year by EUR 10.5 billion, resulting in net cash provided by operating activities of EUR 8.7 billion. This was attributable to income after taxes of EUR 3.6 billion plus a EUR 5.1 billion increase in net debt in connection with the intragroup cash management system. The increase compared with the previous year is attributable in particular to the conversion of current receivables from cash management into long-term loans at Telekom Deutschland GmbH, Bonn, which was completed in the reporting year. In addition, the year-on-year increase was attributable in part to a repayment of liabilities from cash management in connection with a capital repayment by T‑Mobile Global Zwischenholding GmbH, Bonn, in the previous year.

Net cash used for/provided by investing activities changed year-on-year by EUR 14.6 billion, resulting in net cash used for investing activities of EUR 3.0 billion. This change was primarily attributable to cash outflows of EUR 5.2 billion in the reporting period as a result of loans granted to subsidiaries, mainly due to intragroup debt restructuring measures at Telekom Deutschland GmbH, Bonn. Corporate actions at subsidiaries resulted in further cash outflows in the amount of EUR 0.4 billion. Repayments of loans by Deutsche Telekom Europe B.V., Maastricht, in the amount of EUR 1.0 billion, and by T‑Mobile USA, Inc., Bellevue, in the amount of EUR 0.8 billion in partcular had an offsetting effect. Net cash used for/provided by investing activities also included interest received of EUR 0.8 billion. In the previous year, the Company’s investing activities had been impacted by capital and loan repayments by subsidiaries totaling EUR 11.7 billion, in particular by T‑Mobile USA, Inc., Bellevue, and T‑Mobile Global Zwischenholding GmbH, Bonn, as well as by cash outflows to subsidiaries in connection with loans granted and the acquisition of property totaling EUR 1.3 billion. The prior-year figure had also included interest received of EUR 1.2 billion.

Net cash used for financing activities decreased only marginally by EUR 0.2 billion year-on-year to EUR 8.4 billion. Net cash used for financing activities in the reporting year resulted primarily from net repayments of current financial liabilities of EUR 4.5 billion, the payment of the dividend for the 2020 financial year of EUR 2.8 billion, and interest paid of EUR 1.3 billion.

In all, this resulted in a decrease in cash and cash equivalents of EUR 2,747 million in the reporting year.