Notes to the consolidated statement of cash flows

Net cash from operating activities

Net cash from operating activities increased by EUR 2.9 billion year-on-year to EUR 11.6 billion. In the first half of 2018, the cash outflows in connection with operating leases reduced net cash from operating activities. Due to the first-time application of IFRS 16, the principal repayment portion of lease payments is presented in net cash used in financing activities. The strong performance of the operating segments, in particular the United States, significantly increased net cash from operating activities. Factoring agreements, especially in the Systems Solutions operating segment, resulted in positive effects of EUR 0.3 billion on net cash from operating activities in the reporting period. The effect from factoring agreements in the prior-year period also totaled EUR 0.3 billion. In addition, in the prior-year period, dividends received in the amount of EUR 0.2 billion had had an increasing effect. Net cash from operating activities was also reduced in the reporting period by a EUR 0.1 billion increase in net interest payments and a EUR 0.1 billion increase in tax payments.

Net cash used in investing activities

Cash capex increased by EUR 1.8 billion to EUR 8.0 billion. In the reporting period, mobile spectrum licenses were acquired for total cash of EUR 1.0 billion. EUR 0.9 billion of this relates to FCC licenses acquired in the United States operating segment in two auctions for the 28 GHz and 24 GHz spectrum, and EUR 0.1 billion to spectrum acquired in the Europe operating segment. The prior-year figure included EUR 0.1 billion for the acquisition of mobile spectrum licenses, predominantly for the United States operating segment. Adjusted for investments in mobile spectrum licenses, cash capex was up by EUR 0.9 billion. EUR 0.7 billion of this related to the United States operating segment and was primarily attributable to the infrastructure build-out for the 600 MHz spectrum, which also lays the groundwork for 5G. In the Germany operating segment, the increase in cash capex was due in particular to the broadband/fiber-optic rollout.

Net cash used in financing activities

Non-cash transactions

In the first half of 2019, Deutsche Telekom chose financing options totaling EUR 0.3 billion under which the payments for trade payables from operating and investing activities primarily become due at a later point in time by involving banks in the process (H1 2018: EUR 0.2 billion). These payables will subsequently be recognized under financial liabilities in the statement of financial position. As soon as the payments have been made, they are disclosed under net cash used in/from financing activities.

In the first half of 2019, Deutsche Telekom leased assets totaling EUR 2.9 billion, mainly network equipment, and land and buildings. These assets are now recognized in the statement of financial position under right-of-use assets and the related liability under lease liabilities. Future repayments of the liabilities will be recognized in net cash used in/from financing activities. In the first half of 2018, finance leases totaling EUR 0.4 billion had been concluded in accordance with the previous standard IAS 17.

Consideration for the acquisition of broadcasting rights will be paid by Deutsche Telekom in accordance with the terms of the contract on the date of its conclusion or spread over the term of the contract. Financial liabilities of EUR 0.1 billion were recognized in the first half of 2019 for future consideration for acquired broadcasting rights (H1 2018: EUR 0.1 billion). As soon as the payments have been made, they are disclosed under net cash used in/from financing activities.

In the United States operating segment, EUR 0.3 billion was recognized for mobile handsets under property, plant and equipment in the reporting period (H1 2018: EUR 0.5 billion). These relate to the JUMP! On Demand business model at T-Mobile US, under which customers do not purchase the devices but lease them. The payments are presented under net cash from operating activities.

As part of the acquisition of 100 percent of the shares in Tele2 Netherlands N.V., Deutsche Telekom transferred a 25 percent share in T-Mobile Netherlands (prior to the business combination). For more information, please refer to the section “Changes in the composition of the Group.”