Results of operations of Deutsche Telekom AG

Operating results decreased further from EUR -0.8 billion to EUR -1.6 billion, due mainly to a year-on-year decrease in other operating income of EUR 1.1 billion and a EUR 0.1 billion decrease in net revenue. In particular, a decline in other operating expenses of EUR 0.4 billion had an offsetting effect.

Lower intragroup cost transfers from renting and leasing out property and from hiring out employees contributed to the reduction in net revenue of EUR 0.1 billion in total.

The decrease of EUR 1.0 billion in other operating income was mainly due to EUR 1.1 billion lower gains on asset disposals, which in the previous year had primarily included gains of EUR 0.6 billion on the intragroup disposal of shares in Erste DFMG Deutsche Funkturm Vermögens-GmbH, Bonn, and of EUR 0.5 billion arising from the buy-back of own shares by DFMG Holding GmbH, Bonn. The decline was also attributable to EUR 0.1 billion lower income from derivatives, mainly in connection with U.S. dollar currency contracts.

The decrease of EUR 0.4 billion in other operating expenses primarily resulted from a decrease of EUR 0.1 billion in expenses from derivatives, of EUR 0.1 billion in expenses for the placement of civil servants, and of EUR 0.1 billion in foreign currency translation losses on loans denominated in foreign currency.

Net financial income increased by EUR 5.6 billion to EUR 11.3 billion, due primarily to an increase of EUR 5.6 billion in income related to subsidiaries, associated and related companies. A EUR 0.2 billion increase in net interest expense had an offsetting effect.

Income related to subsidiaries, associated and related companies of EUR 12.1 billion (2022: EUR 6.5 billion) was positively affected in the reporting year, in particular by profits transferred by Telekom Deutschland GmbH, Bonn, of EUR 5.0 billion (2022: EUR 7.1 billion), by Deutsche Telekom Towers Holding GmbH, Bonn, of EUR 4.0 billion (2022: EUR 0.0 billion), by Deutsche Telekom Europe Holding GmbH, Bonn, of EUR 3.6 billion (2022: EUR 0.0 billion), and by other German companies of EUR 0.5 billion (2022: EUR 0.7 billion) in total. The transfer of losses of EUR 1.3 billion (2022: EUR 1.4 billion), including EUR 0.9 billion (2022: EUR 0.9 billion) from Deutsche Telekom IT GmbH, Bonn, and EUR 0.2 billion (2022: EUR 0.4 billion) from T‑Systems International GmbH, Frankfurt/Main, had an offsetting effect.

Income related to subsidiaries, associated and related companies was impacted in particular by the operating business of the consolidated subsidiaries. In addition, this item was positively affected in the reporting year by income of EUR 3.7 billion at Deutsche Telekom Towers Holding GmbH, Bonn, from the sale of 51.0 % of the shares in GD Towers Holding GmbH, Münster, and income of EUR 3.5 billion at Deutsche Telekom Europe Holding GmbH, Bonn, from a capital repayment by Deutsche Telekom Europe B.V., Maastricht, using a portion of its hidden reserves. In the previous year, income of EUR 2.3 billion from the intragroup sale of shares in DFMG Deutsche Funkturm GmbH, Münster, and income of EUR 0.4 billion from the sale of 50.0 % of the shares in GlasfaserPlus Holding GmbH & Co. KG, Cologne, had had an effect on the profit transferred at Telekom Deutschland GmbH, Bonn.

Net interest expense increased from EUR 0.6 billion to EUR 0.8 billion. Higher short-term interest rates led to a EUR 0.8 billion increase in net interest expense in connection with the intragroup and external financing. This was primarily offset by income from plan assets for pension obligations amounting to EUR 0.2 billion. In the previous year, by contrast, expenses of EUR 0.2 billion had been recorded in this context. In addition, higher income from interest added back to noncurrent pension accruals had a positive effect of EUR 0.1 billion on net interest expense.

Income after income taxes increased by EUR 5.1 billion year-on-year in the 2023 financial year.

Other tax expense of EUR 17 million resulted in income after taxes of EUR 9,095 million in the 2023 financial year. Taking into account EUR 3,217 million in unappropriated net income carried forward, unappropriated net income totaled EUR 12,312 million (prior year: EUR 6,700 million).