Net assets of the Group

Total assets amounted to EUR 290.3 billion as of December 31, 2023, down by EUR 8.3 billion against December 31, 2022. Exchange rate effects in particular, primarily from the translation of U.S. dollars into euros, decreased the carrying amount. Total assets were also reduced in connection with the derecognition of the assets and liabilities that had been fully consolidated until the sale of GD Towers. By contrast, total assets were increased by the cash proceeds from the sale, the sale-and-leaseback transaction concluded in this connection to lease the sold passive network infrastructure in Germany and Austria, and the inclusion of the remaining 49.0 % stake.

On the assets side, cash and cash equivalents increased by EUR 1.5 billion year-on-year to EUR 7.3 billion.

For further information, please refer to Note 37 “Notes to the consolidated statement of cash flows” in the notes to the consolidated financial statements.

At EUR 16.2 billion, trade receivables decreased by EUR 0.6 billion against the 2022 year-end level, mainly as a result of a decline in receivables in the United States operating segment due to a decline in volume of devices sold and leased. Exchange rate effects, in particular from the translation of U.S. dollars into euros, also had a decreasing effect. By contrast, receivables increased in the Europe and Germany operating segments.

Intangible assets decreased by EUR 4.6 billion to EUR 136.0 billion, mainly due to amortization and impairment losses of EUR 6.6 billion. This includes impairment losses of EUR 0.1 billion. Exchange rate effects, primarily from the translation of U.S. dollars into euros, also decreased the carrying amount by EUR 3.9 billion. Disposals reduced the carrying amount by EUR 0.1 billion. By contrast, capital expenditure had an increasing effect of EUR 5.9 billion on the carrying amount. EUR 1.0 billion of this related to the acquisition of mobile spectrum in the United States and Europe operating segments.

Property, plant and equipment decreased by EUR 0.7 billion compared with December 31, 2022 to EUR 65.0 billion. Depreciation and impairment losses of EUR 12.0 billion reduced the carrying amount. This includes impairment losses of EUR 0.1 billion. Exchange rate effects, primarily from the translation of U.S. dollars into euros, also decreased the carrying amount by EUR 1.0 billion. Disposals of EUR 0.3 billion, as well as the reclassification of assets worth EUR 0.1 billion to non-current assets and disposal groups held for sale also reduced the carrying amount. By contrast, additions, primarily for the upgrade and build-out of the network (broadband, fiber-optic, and mobile infrastructure build-out) increased the carrying amount by EUR 12.2 billion. Reclassifications of lease assets – primarily in the United States operating segment for network technology – to property, plant and equipment upon expiry of the contractual lease term also increased the carrying amount by EUR 0.5 billion.

Right-of-use assets decreased by EUR 0.9 billion compared with December 31, 2022 to EUR 32.8 billion. Depreciation, amortization and impairment losses of EUR 5.4 billion reduced the carrying amount. This included a EUR 0.2 billion increase in depreciation due to a reduction in the useful life of leased network technology for cell sites in the United States operating segment following the business combination of T‑Mobile US and Sprint. Exchange rate effects, primarily from the translation of U.S. dollars into euros, also decreased the carrying amount by EUR 1.0 billion. Reclassifications of lease assets – primarily in the United States operating segment for network technology – to property, plant and equipment upon expiry of the contractual lease term decreased the carrying amount by EUR 0.5 billion. Disposals reduced the carrying amount by EUR 0.1 billion. By contrast, the carrying amount was increased by additions of EUR 6.1 billion, in part as a result of the sale and leaseback of passive network infrastructure in Germany and Austria in connection with the sale of GD Towers. In this context, retained right-of-use assets of EUR 2.0 billion were recognized in the consolidated statement of financial position.

Investments accounted for using the equity method increased by EUR 3.3 billion compared to December 31, 2022, to EUR 4.6 billion, essentially as a result of the sale of the 51.0 % stake in GD Towers. Following the loss of control pursuant to the IFRSs as a result of the transaction, the companies were deconsolidated as of February 1, 2023. Since this date, the remaining 49.0 % of the shares have been included in the consolidated financial statements as an investment accounted for using the equity method. At year-end 2023, impairment losses of EUR 2.6 billion and EUR 0.1 billion, respectively, were recognized on the carrying amounts of the investments in GD Towers and in GlasfaserPlus. These impairment losses were due entirely to higher discount rates due to macroeconomic developments in the reporting year. By contrast, the business outlook for GD Towers improved slightly.

Current and non-current financial assets decreased by EUR 0.3 billion to EUR 9.6 billion. Originated loans and receivables increased by EUR 0.2 billion, partly due to an existing shareholder loan to GD Towers, which must be recognized in the consolidated statement of financial position as a result of the deconsolidation. At the same time, the carrying amount of cash collateral increased. By contrast, receivables from grants still to be received from funding projects for the broadband build-out in Germany decreased. The carrying amount of derivatives with a hedging relationship decreased by EUR 0.4 billion due to lower medium- and long-term interest rate expectations. The carrying amount of derivatives without a hedging relationship decreased by EUR 0.1 billion.

Non-current assets and disposal groups held for sale decreased by EUR 4.5 billion compared with December 31, 2022 to EUR 0.2 billion. The sale of GD Towers as of February 1, 2023 reduced the carrying amount by EUR 4.2 billion, and the sale of the Wireline Business at T‑Mobile US as of May 1, 2023 by EUR 0.3 billion. The corresponding assets had previously been reported as held for sale on account of the sales agreements concluded.

For further information on the corporate transactions, please refer to the section “Group organization.”

Miscellaneous assets increased by EUR 0.4 billion to EUR 12.2 billion. Current and non-current other assets contributed EUR 0.3 billion to this increase, due in part to an increase in various advance payments, mainly in connection with agreements on services for certain mobile communications equipment. In addition, capitalized contract costs increased by EUR 0.3 billion. Inventories decreased by EUR 0.2 billion, due to the sale of older terminal equipment and the reduction of warehouses and shops at former Sprint sites in the United States operating segment.

On the liabilities and shareholders’ equity side, current and non-current financial liabilities decreased by EUR 8.5 billion compared with the end of 2022 to EUR 104.5 billion. Bonds and other securitized liabilities decreased by a total of EUR 6.0 billion, due in part to scheduled repayments of EUR 5.6 billion and early repayments of EUR 4.0 billion. Net repayments of commercial paper also resulted in a decrease of EUR 2.3 billion. The carrying amount was increased by the senior notes issued in the reporting year by T‑Mobile US with a total volume of USD 8.5 billion (EUR 7.9 billion). Furthermore, the carrying amounts of liabilities with the right of creditors to priority repayment in the event of default decreased by EUR 0.9 billion, other interest-bearing liabilities by EUR 0.9 billion, and liabilities to banks by EUR 0.6 billion. Derivative liabilities decreased by EUR 0.3 billion, mainly due to lower medium- and long-term interest rate expectations. Exchange rate effects, in particular from the translation of U.S. dollars into euros, also reduced the carrying amount by EUR 2.7 billion in total.

Current and non-current lease liabilities increased by EUR 2.0 billion to EUR 40.8 billion compared with December 31, 2022, mainly as a result of the sale and leaseback of passive network infrastructure in Germany and Austria in connection with the sale of GD Towers. As a result of this transaction, lease liabilities increased by EUR 5.0 billion. By contrast, lease liabilities in the United States operating segment decreased by EUR 1.6 billion due to the decommissioning of the former Sprint’s wireless network and the closure of former Sprint shops in the prior year, as well as a decline in network and build-out investments, primarily on account of higher capital efficiency resulting from the accelerated build-out of the nationwide 5G network in the prior year. Exchange rate effects, in particular from the translation of U.S. dollars into euros, reduced the carrying amount by EUR 1.1 billion.

Trade and other payables decreased by EUR 1.1 billion to EUR 10.9 billion, due in particular to lower liabilities in the United States operating segment, primarily as a result of a lower procurement volume. Exchange rate effects, in particular from the translation from U.S. dollars into euros, also decreased the carrying amount. By contrast, the Germany and Europe operating segments recorded an increase in liabilities.

Provisions for pensions and other employee benefits decreased by EUR 0.1 billion compared with December 31, 2022 to EUR 4.1 billion, mainly due to an increase in the fair values of plan assets. By contrast, the decline in the discount rate compared with December 31, 2022 increased the carrying amount.

Current and non-current other provisions decreased by EUR 0.1 billion compared with the end of 2022 to EUR 8.1 billion, with provisions for restoration obligations decreasing by EUR 0.2 billion, due in particular to the decommissioning of the former Sprint mobile network and due to shop closures in 2022. Provisions for procurement and sales support decreased by EUR 0.2 billion, mainly in connection with the bonuses paid out to sales partners in the United States operating segment. Miscellaneous other provisions decreased by EUR 0.3 billion. By contrast, other provisions for personnel costs increased by EUR 0.3 billion, mainly due to an increase in the carrying amount of the provision recognized for the Civil Health Insurance Fund (Postbeamtenkrankenkasse – PBeaKK). This is primarily due to a decline in the discount rate. Provisions for termination benefits increased by EUR 0.2 billion. These provisions include expenses incurred for the workforce reduction implemented in the United States operating segment in the third quarter of 2023.

Liabilities directly associated with non-current assets and disposal groups held for sale decreased by EUR 3.3 billion against December 31, 2022 to EUR 0.0 billion. The sale of GD Towers as of February 1, 2023 reduced the carrying amount by EUR 3.0 billion, and the sale of the wireline business at T‑Mobile US as of May 1, 2023 by EUR 0.4 billion. The corresponding liabilities had previously been reported as held for sale on account of the sales agreements concluded.

For further information on the corporate transactions, please refer to the section “Group organization.”

Miscellaneous liabilities decreased from EUR 8.9 billion as of December 31, 2022 to EUR 8.8 billion, mainly due to a decrease of EUR 0.3 billion in other liabilities as a result of existing build-out obligations in connection with grants still to be received from funding projects for the broadband build-out in Germany. By contrast, contract liabilities increased by EUR 0.2 billion.

Shareholders’ equity increased from EUR 87.3 billion as of December 31, 2022 to EUR 91.2 billion, with profit of EUR 22.0 billion and capital increases from share-based payments of EUR 0.7 billion having an increasing effect. Other comprehensive income, by contrast, decreased the carrying amount by EUR 2.3 billion. Transactions with owners, mainly attributable to the United States operating segment, reduced the carrying amount of shareholders’ equity by EUR 12.5 billion. These arose in connection with T‑Mobile US’ share buy-back program from 2022 and the T‑Mobile US shareholder return program from September 2023, which, in addition to the share buy-back started in 2023, also comprised the payment of an initial cash dividend of USD 0.65 per share. The transfer of T‑Mobile US shares to SoftBank in accordance with the supplementary agreement from February 20, 2020 closed between T‑Mobile US, SoftBank, and Deutsche Telekom in the course of the merger of T‑Mobile US and Sprint resulted in a reclassification within shareholders’ equity. The carrying amount was also reduced in connection with dividend payments for the 2022 financial year to Deutsche Telekom AG shareholders in the amount of EUR 3.5 billion and to other shareholders of subsidiaries in the amount of EUR 0.5 billion.