13 Financial liabilities and lease liabilities

The following table shows the composition and maturity structure of financial liabilities and lease liabilities as of December 31, 2024:

The carrying amount of current and non-current financial liabilities increased by EUR 7.7 billion compared with year-end 2023 to EUR 112.2 billion, primarily due to the factors described below. Exchange rate effects, in particular from the translation of U.S. dollars into euros, increased the carrying amount by EUR 5.4 billion.

The carrying amount of bonds and other securitized liabilities increased by EUR 7.6 billion to EUR 94.7 billion. The carrying amount was increased by USD bonds issued by T‑Mobile US in the reporting period with a total volume of USD 5.5 billion (EUR 5.0 billion) with terms ending between 2029 and 2055 and bearing interest of between 4.2 % and 5.5 %, and by EUR bonds with a volume of EUR 2.0 billion with terms ending between 2029 and 2036 and bearing interest of between 3.55 % and 3.85 %. The carrying amount was also increased by the issue of EUR bonds of EUR 1.7 billion by Deutsche Telekom AG, with terms ending in 2035 and 2044 and bearing interest of 3.25 % to 3.56 %. The carrying amount was reduced by scheduled repayments of a USD bond of USD 2.5 billion (EUR 2.3 billion), EUR bonds of EUR 2.0 billion, EUR loan notes of EUR 0.1 billion, and the early repayment of a USD bond bearing interest of 7.625 % in the volume of USD 1.5 billion (EUR 1.4 billion). In addition, the carrying amount increased by EUR 0.1 billion in connection with measurement effects from derivatives with a hedging relationship, the offsetting entry for which is posted under bonds and other securitized liabilities. Exchange rate effects increased the carrying amount of bonds and other securitized liabilities by EUR 4.8 billion.

The asset-backed securities collateralized by trade receivables of EUR 1.5 billion (December 31, 2023: EUR 0.7 billion) are bonds issued by T‑Mobile US. Trade receivables were provided as collateral for these bonds, hence they constitute a separate class of financial instruments. Issues in the reporting period in the amount of EUR 0.9 billion when translated into euros increased the carrying amount. Exchange rate effects also increased the carrying amount by EUR 0.1 billion. Repayments in the reporting period in the amount of EUR 0.2 billion when translated into euros reduced the carrying amount. As of the reporting date, trade receivables with a carrying amount of EUR 1.8 billion when translated into euros (December 31, 2023: EUR 0.9 billion) were pledged as collateral for these bonds.

The carrying amount of liabilities to banks decreased by EUR 1.3 billion compared with December 31, 2023 to EUR 2.3 billion, mainly due to the reclassification of a liability, arising in connection with factoring transactions from liabilities to banks, to other non-interest-bearing liabilities. The reclassification was triggered by a change in the billing method. While Deutsche Telekom’s continuing involvement was previously ensured by holding back purchase price portions, it will now be secured through non-cash collateral in the form of the pledging of unsold trade receivables. The carrying amount was also reduced by the repayment of an EIB loan by Deutsche Telekom AG in the amount of EUR 0.4 billion.

The liabilities with the right of creditors to priority repayment in the event of default of EUR 1.3 billion (December 31, 2023: EUR 2.1 billion) relate primarily to bonds issued by Sprint. Collateral was provided for these bonds, hence they constitute a separate class of financial instruments. The main factor reducing the carrying amount was repayments made in the reporting period in the amount of EUR 0.8 billion when translated into euros. By contrast, exchange rate effects increased the carrying amount by EUR 0.1 billion. At the reporting date, cash and cash equivalents with a carrying amount of EUR 70 million (December 31, 2023: EUR 64 million) when translated into euros were pledged as collateral for these bonds.

The carrying amount of other interest-bearing liabilities decreased by EUR 0.2 billion compared with December 31, 2023 to EUR 6.4 billion. Scheduled repayments by T‑Mobile US reduced the carrying amount by EUR 0.2 billion, when translated into euros, the majority of which related to payments made in connection with the existing agreement on IP transit services, concluded with Cogent as part of the sale of the Wireline Business. Likewise, scheduled repayments of loans for the acquisition of 5G licenses in the Germany operating segment reduced the carrying amount by EUR 0.2 billion. By contrast, the recognition of a liability for the contingent and other consideration paid for the acquisition of Ka’ena increased the carrying amount by EUR 0.2 billion, when translated into euros. Exchange rate effects increased the carrying amount of other interest-bearing liabilities by EUR 0.2 billion.

For further information on the acquisition of Ka’ena, please refer to the section “Changes in the composition of the Group and other transactions.”

The carrying amount of other non-interest-bearing liabilities increased by EUR 1.2 billion to EUR 2.1 billion, mainly due to the aforementioned reclassification of a liability arising in connection with factoring transactions from liabilities to banks. EUR 0.5 billion of the increase was due to the stake of the cash dividend of USD 0.88 per share – declared by the Board of Directors of T‑Mobile US on November 21, 2024 – attributable to non-controlling interests in T‑Mobile US.

For further information on the shareholder return program at T‑Mobile US, please refer to the section “Other transactions that had no effect on the composition of the Group.”

The carrying amount of derivative financial liabilities increased by EUR 0.1 billion compared with December 31, 2023 to EUR 2.7 billion. It was reduced by EUR 0.2 billion by measurement effects from interest rate swaps and cross-currency swaps in fair value hedges. By contrast, gains on derivatives in cash flow hedges increased the carrying amount by EUR 0.2 billion.

For further information on derivative financial liabilities, please refer to Note 43 “Financial instruments and risk management.”

Deutsche Telekom has established ongoing liquidity management. To ensure the Group’s and Deutsche Telekom AG’s solvency and financial flexibility at all times, Deutsche Telekom maintains a liquidity reserve in the form of credit lines and cash. This liquidity reserve is to cover the capital market maturities of the next 24 months at any time. Since the business combination between T‑Mobile US and Sprint, T‑Mobile US has pursued its own separate financing and liquidity strategy.

At December 31, 2024, Deutsche Telekom (excluding T‑Mobile US) had standardized bilateral credit agreements with 20 banks for a total of EUR 12.0 billion. None of these lines of credit had been utilized as of December 31, 2024. Pursuant to the credit agreements, the terms and conditions depend on Deutsche Telekom’s rating. The bilateral credit agreements have an original maturity of 36 months and can, after each period of 12 months, be extended by a further 12 months to renew the maturity of 36 months. Furthermore, cash on hand of EUR 3.0 billion were available to Deutsche Telekom.

Bilateral credit lines with an aggregate total volume of USD 7.5 billion (EUR 7.2 billion) and a cash balance of USD 5.4 billion (EUR 5.2 billion) were available to T‑Mobile US as of December 31, 2024. None of these credit lines had been utilized as of December 31, 2024.

The carrying amount of current and non-current lease liabilities decreased by EUR 0.5 billion to EUR 40.2 billion compared with December 31, 2023. Lease liabilities in the United States operating segment decreased by EUR 2.2 billion, mainly due to the decommissioning of the former Sprint’s wireless network and 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, raised the carrying amount by EUR 2.0 billion. Lease liabilities in the Germany operating segment and in the Group Headquarters & Group Services segment decreased by EUR 0.2 billion in each case.

For further information on lessee relationships, please refer to Note 8 “Right of use assets – lessee relationships.”

In the reporting year and in the previous year, there were no significant expenses for variable lease payments that were not included in the measurement of lease liabilities.

As of December 31, 2024, as in the prior year, there were no significant future payment obligations for leases that have not yet begun and which are not taken into account in the measurement of lease liabilities.

The following tables show the contractually agreed (undiscounted) cumulative interest payments and repayments of the non-derivative financial liabilities, the lease liabilities, and the derivatives with positive and negative fair values:

For information on the guarantees to Glasfaser NordWest, please refer to Note 45 “Related party disclosures.”

All instruments held at December 31, 2024 and for which payments were already contractually agreed were included. Planning data for future, new liabilities were not included. Amounts in foreign currency were each translated at the closing rate at the reporting date. The variable interest payments arising from the financial instruments were calculated using the last interest rates fixed before December 31, 2024. Financial liabilities that can be repaid at any time are always assigned to the earliest possible time period.