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Selected financial data of the Group

Net revenue

  • Net revenue increased by 7.7 % to EUR 108.8 billion. In organic terms, too, revenue increased by EUR 4.7 billion or 4.5 %. Service revenue increased by EUR 5.2 billion or 6.5 % to EUR 84.1 billion.
  • 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 GD Towers. In organic terms, revenue increased by 4.6 %.

billions of €

Net revenue (bar chart)

EBITDA AL (adjusted for special factors)

  • Adjusted EBITDA AL grew by 6.6 % to EUR 37.3 billion with all operating segments contributing to this positive trend. In organic terms, our adjusted EBITDA AL increased by EUR 0.7 billion or 1.9 %.
  • Adjusted EBITDA AL rose sharply by 8.1 % in the United States, in part as a result of the business combination with Sprint. In organic terms, adjusted EBITDA AL remained on a par with the prior-year level. Adjusted core EBITDA AL, 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 EUR 2.5 billion or 14.7 %.
  • Germany and Europe posted growth in adjusted EBITDA AL of 3.6 % and 2.5 % respectively, driven by high-value revenue growth and enhanced cost efficiency.
  • In our Systems Solutions segment, adjusted EBITDA AL 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 adjusted EBITDA AL of 18.7 %. This was driven primarily by revenue growth at T‑Mobile Netherlands and GD Towers, and efficient management of costs.
  • At 34.3 %, the Group’s adjusted EBITDA AL 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.

billions of €

EBITDA AL (adjusted for special factors) (bar chart)

EBIT

  • EBIT increased by EUR 0.3 billion or 2.0 % to EUR 13.1 billion.
  • EBITDA AL was negatively affected by special factors of EUR 3.4 billion compared to expenses of EUR 1.8 billion in the prior year. Expenses of EUR 2.6 billion were recorded in connection with the business combination of T‑Mobile US 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 EUR 0.2 billion. Expenses in connection with staff restructuring measures were down year-on-year by EUR 0.6 billion. Reversals of impairment losses of EUR 1.7 billion had been recognized in the prior year and mainly related to the partial reversal of impairment losses on spectrum licenses at T‑Mobile US, which increased the carrying amount.
  • Depreciation, amortization, and impairment losses were EUR 1.7 billion 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 EUR 0.8 billion.

billions of €

EBIT (bar chart)

Net profit

  • Net profit remained stable at EUR 4.2 billion.
  • Loss from financial activities increased by EUR 1.0 billion to EUR 5.1 billion, partly in connection with an increase in finance costs due to the assumption of Sprint’s financial liabilities. Other financial income/expense decreased by EUR 0.5 on a net basis in connection with the measurement of derivatives and the measurement of provisions and liabilities.
  • Tax expense came to EUR 1.8 billion compared with EUR 1.9 billion in the prior year.
  • Profit attributable to non-controlling interests decreased by EUR 0.7 billion to EUR 1.9 billion.
  • Adjusted earnings per share amounted to EUR 1.22 compared with EUR 1.20 in the prior year.

billions of €

Net profit (bar chart)

Net debt

  • Net debt increased by EUR 11.9 billion to EUR 132.1 billion compared with the end of 2020.
  • This increase was attributable in particular to the acquisition of spectrum (EUR 8.4 billion), primarily in the United States; exchange rate effects (EUR 6.9 billion); and additions of lease liabilities (EUR 5.3 billion). Dividend payments – including to non-controlling interests – (EUR 3.1 billion) and the acquisition of Shentel (EUR 1.9 billion) further increased net debt.
  • Free cash flow of EUR 14.3 billion had a reducing effect.

billions of €

Net debt (bar chart)

Cash capex (before spectrum investment)

  • Cash capex (before spectrum investment) increased by EUR 1.0 billion to EUR 18.0 billion.
  • 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 EUR 7.7 billion to EUR 26.4 billion. In the reporting year, the United States segment acquired FCC spectrum licenses for a total amount of EUR 8.3 billion. Another EUR 0.1 billion was paid for spectrum in the Europe segment. The prior-year figure included EUR 1.7 billion for the acquisition of mobile spectrum licenses, which primarily related to the United States, Europe, and Group Development segments.

billions of €

Cash capex (before spectrum investment) (bar chart)

Free cash flow AL (before dividend payments and spectrum investment)a

  • Free cash flow AL (before dividend payments and spectrum investment) increased by EUR 2.5 billion year-on-year to EUR 8.8 billion.
  • Net cash from operating activities increased by EUR 4.7 billion. This was attributable in particular to the sustained positive performance of the operating segments, especially in the United States including Sprint.
  • Apart from the EUR 1.0 billion 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‑Mobile US in September 2021 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 flow AL.

billions of €

Free cash flow AL (before dividend payments and spectrum investment) (bar chart)

ROCE

  • 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‑Mobile US 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‑Mobile US 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.

%

ROCE (bar chart)

For further information, please refer to the section “Development of business in the Group.”

For further information on the level of achievement of our main financial and non-financial key performance indicators, please refer to the relevant section “Development of business in the Group – Comparison of the Group’s expectations with actual figures.”

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

a aBefore interest payments for zero-coupon bonds and before termination of forward-payer swaps at T‑Mobile US (both in 2020).