Deutsche Telekom at a glance

Net revenue

• Net revenue increased by EUR 6.4 billion or 32.3 % year-on-year from EUR 19.9 billion to EUR 26.4 billion. In organic terms, revenue increased by EUR 1.8 billion or 7.1 %.
• Our United States segment posted an increase in revenue of 62.3 %. In organic terms, revenue increased by 10.5 % year-on-year due to higher service and terminal equipment revenues.
• In our Germany and Europe segments, revenue on an organic basis remained on a par with the prior-year level. Revenue in the Europe segment was down 1.1 % on account of exchange rate effects.
• Revenue in our Systems Solutions segment decreased year-on-year by 4.4 % due primarily to the coronavirus-induced contraction of the IT market.
• In our Group Development segment, T‑Mobile Netherlands and GD Towers grew 10.5 % year-on-year on the back of the acquired entity Simpel and the reassignment of the Austrian cell tower business, among other factors. In organic terms, revenue increased by 5.0 %.

billions of €

EBITDA AL (adjusted for special factors)

• Adjusted EBITDA AL grew by EUR 2.7 billion or 41.3 % from EUR 6.5 billion to EUR 9.2 billion, with all segments contributing to this positive trend. Excluding exchange rate effects and changes in the composition of the Group, our adjusted EBITDA AL increased by EUR 0.7 billion or 8.3 %.
• Adjusted EBITDA AL rose sharply by 80.6 % in our United States segment, primarily as a result of the business combination of T‑Mobile US and Sprint. In organic terms, adjusted EBITDA AL grew by 10.7 % year-on-year.
• Our Germany segment recorded an increase in adjusted EBITDA AL of 3.4 % and our Europe operating segment a slight increase of 1.1 %.
• Adjusted EBITDA AL grew substantially in our Group Development segment, by 17.5 %. This was driven primarily by revenue growth at T‑Mobile Netherlands and GD Towers, synergies from the acquisition of Tele2 Netherlands, the acquisition of Simpel, and efficient management of costs at T‑Mobile Netherlands.
• At 35.0 %, the Group’s adjusted EBITDA AL margin increased by 2.2 percentage points against the prior-year level. The adjusted EBITDA AL margin was 38.8 % in the Germany segment, 34.7 % in the Europe segment, and 34.6 % in the United States segment.

billions of €

EBIT

• EBIT increased by EUR 1.0 billion or 40.1 % year-on-year from EUR 2.5 billion to EUR 3.5 billion, mainly as a result of the effects described under adjusted EBITDA AL.
• EBITDA AL was negatively affected by special factors of EUR 0.4 billion compared to expenses of EUR 0.6 billion in the prior-year period. Expenses of EUR 0.2 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; this contrasted with expenses of EUR 0.1 billion in the prior-year period. Special factors in connection with staff-related measures were down in the first quarter of 2021 by EUR 0.2 billion. Expenses of EUR 0.1 billion in the first quarter of 2020, primarily in connection with the coronavirus pandemic, had been classified as special factors in the United States segment.
• Depreciation, amortization and impairment losses were EUR 2.4 billion higher than in the prior-year period due in particular to the acquisition of Sprint.

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Net profit

• Net profit remained unchanged at EUR 0.9 billion.
• Loss from financial activities increased by EUR 0.7 billion to EUR 1.7 billion, largely in connection with an increase in finance costs of EUR 0.6 billion from the transfer of Sprint’s financial liabilities and the restructuring activities and measures to increase the financing volume begun in the context of the business combination. Other financial expense increased by EUR 0.1 billion year-on-year to EUR 0.5 billion.
• The tax expense remained stable compared with the prior-year period at EUR 0.5 billion.
• Profit attributable to non-controlling interests increased from EUR 0.2 billion to EUR 0.4 billion.
• Adjusted earnings per share amounted to EUR 0.25 compared with EUR 0.27 in the prior-year period.

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Equity ratio

• The equity ratio increased by 0.9 percentage points against December 31, 2020 from 27.4 % to 28.3 %.
• The EUR 4.9 billion increase in shareholders’ equity is primarily attributable to profit of EUR 1.3 billion and to other comprehensive income of EUR 3.6 billion. This mainly includes effects from currency translations (EUR 2.7 billion) and the remeasurement of defined benefit plans (EUR 1.0 billion).
• Income taxes relating to components of other comprehensive income of EUR 0.2 billion reduced shareholder’s equity in other comprehensive income.

%

Cash capex (before spectrum investment)

• Cash capex (before spectrum investment) increased by EUR 0.9 billion or 27.7 % from EUR 3.4 billion to EUR 4.3 billion, largely on account of the inclusion of Sprint and the ongoing 5G network build-out in the United States. In the Germany segment, cash capex decreased due to lower investments as a result of bad weather conditions and reduced cash outflows. In the Europe segment, we continued to invest in our fiber-optic network and forged ahead with the build-out of our mobile communications infrastructure.
• Cash capex (including spectrum investment) increased by EUR 8.7 billion to EUR 12.3 billion. Spectrum licenses were purchased for EUR 8.0 billion in the reporting period, in particular FCC mobile licenses at the C-band auction in the United States segment. The prior-year period had included EUR 0.2 billion in advance payments for the purchase of FCC mobile licenses.

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

• Free cash flow AL increased by EUR 1.3 billion from EUR 1.3 billion to EUR 2.6 billion.
• The business combination of T‑Mobile US and Sprint effective April 1, 2020, and the sustained positive business trends in the other segments had an increasing effect. Additionally, the prior-year quarter had included a negative effect in the amount of EUR 0.5 billion from factoring agreements that no longer applied in the reporting quarter.
• The increase was partially offset by EUR 0.9 billion higher cash capex (before spectrum investment) and in particular by EUR 0.7 billion higher interest payments (net), mainly as a result of the financial liabilities recognized and the restructuring begun in connection with the acquisition of Sprint, and the related increase in financing. The EUR 0.1 billion higher income tax payments also had a negative effect.

billions of €

Net debt

• Net debt increased by EUR 9.3 billion from EUR 120.2 billion at the end of 2020 to EUR 129.5 billion.
• This increase was largely attributable to the purchase of spectrum for EUR 8.0 billion, primarily in the United States segment. Exchange rate effects (EUR 3.8 billion) and additions of lease liabilities (EUR 1.1 billion) also had an increasing effect.
• The main factor reducing net debt was free cash flow (before dividend payments and spectrum investment) of EUR 4.1 billion.

billions of €

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