Results of operations of Deutsche Telekom AG

Operating results improved from EUR -1.6 billion to EUR 10.5 billion, due mainly to a year-on-year increase in other operating income of EUR 12.4 billion and a EUR 0.4 billion decrease in personnel costs. In particular, an increase in other operating expenses of EUR 0.7 billion had an offsetting effect.

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

EUR 12.8 billion of other operating income relates in particular to book gains arising from the use of hidden reserves in connection with the intragroup aggregation of shares in the multi-level holding structure for the investment in T‑Mobile US.

The decrease in personnel costs is largely attributable to early retirement arrangements for civil servants. As the statutory regulation has not yet been extended beyond 2024, no accruals were recognized for early retirement arrangements for civil servants. In the previous year, expenses of EUR 0.4 billion had been recognized for such arrangements.

Other operating expenses of EUR 0.8 billion are attributable to a reduction in shares in affiliated companies in connection with the capital repayment by the indirect subsidiary Deutsche Telekom Holding B.V., Maastricht. The capital repayment also changed the income related to subsidiaries, associated and related companies of Deutsche Telekom AG.

Net financial income decreased by EUR 0.6 billion to EUR 10.6 billion, due primarily to a decrease of EUR 0.6 billion in income related to subsidiaries, associated and related companies. Net interest expense remained virtually unchanged year-on-year at EUR 0.8 billion.

Income related to subsidiaries, associated and related companies of EUR 11.5 billion (2023: EUR 12.1 billion) was positively affected in the reporting year, in particular by profits transferred by T‑Mobile Global Zwischenholding GmbH, Bonn, of EUR 6.4 billion (2023: loss of EUR 0.1 billion) and by Telekom Deutschland GmbH, Bonn, of EUR 4.9 billion (2023: EUR 5.0 billion). The transfer of losses of EUR 0.9 billion (2023: EUR 1.3 billion) had an offsetting effect. Overall, transfers of operating profits and losses were at the prior-year level.

Income related to subsidiaries, associated and related companies was positively affected in the reporting year by the operating business of the subsidiaries and in particular by the capital repayment of the indirect subsidiary Deutsche Telekom Holding B.V., Maastricht, which directly holds the shares in T‑Mobile US. The capital repayment generated income from the use of a portion of hidden reserves of EUR 6.5 billion, applying IDW ERS HFA 13 as amended, at the level of the shareholder T‑Mobile Global Holding GmbH, Bonn, which due to the multi-level holding structure was reflected in the profit transfers to T‑Mobile Global Zwischenholding GmbH, Bonn, and to Deutsche Telekom AG. Income related to subsidiaries, associated and related companies in the previous year had included income of EUR 3.7 billion from the sale of shares in GD Towers Holding GmbH, Bonn, and income of EUR 3.5 billion from a capital repayment by Deutsche Telekom Europe B.V., Maastricht.

Income after income taxes increased by EUR 11.5 billion year-on-year in the 2024 financial year.

Other tax expense of EUR 18 million resulted in net income of EUR 20,627 million in the 2024 financial year. Taking into account EUR 8,495 million in unappropriated net income carried forward, unappropriated net income totaled EUR 29,122 million (prior year: EUR 12,312 million).