Germany
Customer development
thousands |
|
|
|
|
|
|
|
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|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Sept. 30, 2022 |
June 30, 2022 |
Change |
Dec. 31, 2021 |
Change |
Sept. 30, 2021 |
Change |
||||||
Mobile customers |
52,991 |
54,551 |
(2.9) |
53,211 |
(0.4) |
52,184 |
1.5 |
||||||
Contract customersa |
23,544 |
23,402 |
0.6 |
23,129 |
1.8 |
22,914 |
2.7 |
||||||
Prepaid customersa, b |
29,447 |
31,149 |
(5.5) |
30,081 |
(2.1) |
29,270 |
0.6 |
||||||
Fixed-network lines |
17,396 |
17,437 |
(0.2) |
17,525 |
(0.7) |
17,543 |
(0.8) |
||||||
Retail broadband lines |
14,641 |
14,578 |
0.4 |
14,478 |
1.1 |
14,394 |
1.7 |
||||||
Of which: optical fiberc |
11,740 |
10,836 |
8.3 |
10,379 |
13.1 |
10,175 |
15.4 |
||||||
Television (IPTV, satellite) |
4,071 |
4,039 |
0.8 |
4,001 |
1.7 |
3,966 |
2.6 |
||||||
Unbundled local loop lines (ULLs) |
3,231 |
3,351 |
(3.6) |
3,622 |
(10.8) |
3,744 |
(13.7) |
||||||
Wholesale broadband lines |
8,033 |
8,001 |
0.4 |
7,948 |
1.1 |
7,900 |
1.7 |
||||||
Of which: optical fiber |
6,929 |
6,883 |
0.7 |
6,778 |
2.2 |
6,708 |
3.3 |
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|
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Total
In Germany we continue to be market leader both in terms of fixed-network and mobile revenues. This success is attributable to our high-performance networks. We offer the best customer experience with award-winning network quality – in the fixed network as in mobile communications – and with a broad product portfolio and good service. We want to offer our customers a seamless and technology-neutral telecommunications experience. We regularly adapt our product portfolio to address the needs of our customers. As of July 1, 2022, we successfully launched the new MagentaMobil rate plans.
Demand remained high for our fiber-optic-based lines. The total number of these customer lines increased to around 18.7 million by the end of September 2022, which means a further 1.5 million customers in Germany received a fiber-optic-based line from us in the first nine months of 2022. Two key factors are driving this strong growth: demand for higher bandwidths, and the technical migrations of customer lines to optical fiber under our “Turn customers into fans” (Kunden zu Fans machen) initiative launched as of June 1, 2022.
Mobile communications
The number of high-value mobile contract customers under the Telekom and congstar brands grew by 754 thousand customers overall. Sustained demand for mobile rate plans with included data volumes continues to drive this trend. A portion of prepaid customers were migrated to another network provider at the end of the third quarter of 2022. Furthermore, as of January 1, 2022, a portion of consumers previously reported under contract customers were reclassified as prepaid customers. Allowing for this change in disclosure, the number of prepaid customers decreased by 812 thousand.
Fixed network
The fixed-network broadband market hosts a large number of players with differing infrastructures – from national through to regional providers. In order to consolidate our position on the market as Germany’s leading telecommunications provider, we continue to add new offerings to our portfolio.
The number of broadband lines increased by around 160 thousand to 14.6 million in the first nine months of 2022, with growth accelerating again in the third quarter of 2022. Almost 40 % of the customers subscribed to a rate plan with speeds of 100 Mbit/s or higher. We recorded an increase of 70 thousand in the number of TV customers compared with year-end 2021. In the traditional fixed network, the number of lines decreased by 129 thousand, bringing the number of fixed-network lines to 17.4 million as of September 30, 2022.
Wholesale
As of September 30, 2022, fiber-optic-based lines accounted for 61.5 % of all lines – 2.9 percentage points more than at the end of 2021. This growth is a result of the demand for our commitment agreements. Rising demand among retail customers for higher-bandwidth lines also contributed to the increase. The number of unbundled local loop lines decreased by 391 thousand compared with the end of the prior year, partly as a result of the shift to higher-value fiber-optic-based lines and partly from consumers switching to other providers. In addition, our wholesale customers are migrating their retail customers to their own fiber-optic-based lines. The total number of wholesale lines at the end of September 2022 was around 11.3 million.
Development of operations
millions of € |
|
|
|
|
|
|
|
|
|
|
|---|---|---|---|---|---|---|---|---|---|---|
|
|
Q1-Q3 2022 |
Q1-Q3 2021 |
Change |
Q1 2022 |
Q2 2022 |
Q3 2022 |
Q3 2021 |
Change |
FY 2021 |
Total revenue |
|
18,145 |
17,763 |
2.2 |
5,963 |
6,038 |
6,144 |
5,974 |
2.8 |
24,050 |
Consumers |
|
9,217 |
8,975 |
2.7 |
3,034 |
3,063 |
3,120 |
3,052 |
2.2 |
12,122 |
Business Customers |
|
6,640 |
6,548 |
1.4 |
2,186 |
2,213 |
2,241 |
2,178 |
2.9 |
8,922 |
Wholesale |
|
2,017 |
2,032 |
(0.7) |
679 |
674 |
664 |
675 |
(1.6) |
2,709 |
Other |
|
271 |
208 |
30.3 |
63 |
89 |
119 |
70 |
70.0 |
297 |
Service revenue |
|
16,020 |
15,801 |
1.4 |
5,289 |
5,356 |
5,375 |
5,301 |
1.4 |
21,212 |
Profit (loss) from operations (EBIT) |
|
5,662 |
3,748 |
51.1 |
3,024 |
1,226 |
1,412 |
1,350 |
4.6 |
4,956 |
EBIT margin |
% |
31.2 |
21.1 |
|
50.7 |
20.3 |
23.0 |
22.6 |
|
20.6 |
Depreciation, amortization and impairment losses |
|
(2,993) |
(3,012) |
0.6 |
(998) |
(995) |
(1,001) |
(1,001) |
0.0 |
(4,020) |
EBITDA |
|
8,655 |
6,760 |
28.0 |
4,021 |
2,221 |
2,413 |
2,350 |
2.7 |
8,976 |
Special factors affecting EBITDA |
|
1,276 |
(395) |
n.a. |
1,621 |
(215) |
(130) |
(120) |
(8.3) |
(595) |
EBITDA (adjusted for special factors) |
|
7,379 |
7,155 |
3.1 |
2,400 |
2,436 |
2,543 |
2,470 |
3.0 |
9,572 |
EBITDA AL |
|
8,634 |
6,733 |
28.2 |
4,015 |
2,214 |
2,405 |
2,342 |
2.7 |
8,941 |
Special factors affecting EBITDA AL |
|
1,276 |
(395) |
n.a. |
1,621 |
(215) |
(130) |
(120) |
(8.3) |
(595) |
EBITDA AL |
|
7,358 |
7,128 |
3.2 |
2,393 |
2,429 |
2,535 |
2,462 |
3.0 |
9,536 |
EBITDA AL margin |
% |
40.6 |
40.1 |
|
40.1 |
40.2 |
41.3 |
41.2 |
|
39.7 |
Cash capex |
|
(2,906) |
(2,693) |
(7.9) |
(902) |
(876) |
(1,128) |
(993) |
(13.6) |
(4,119) |
Total revenue, service revenue
In the first nine months of 2022, we generated total revenue of EUR 18.1 billion, which was up by 2.2 % year-on-year. The growth in service revenues of 1.4 % was attributable to increased revenue in the fixed-network core business, largely broadband-driven, and in mobile business.
Revenue from Consumers increased by 2.7 % compared with the prior-year period. Revenue from broadband business grew by 5.9 %, due in part to the positive effects from customer appreciation for stable data lines and high bandwidths. Fixed-network terminal equipment business posted growth of 2.3 % on the back of demand on the customer side for terminal equipment lease models. Volume-driven declines in revenue from voice components continued to impact on traditional fixed-network business. Mobile business increased by 3.2 % thanks to higher service revenues, mainly due to positive customer development in our second brand congstar and general trends of recovery, including a return to travel and other recreational activities.
Revenue from Business Customers was up by 1.4 % year-on-year. If the one-time effect from the public sector in the prior year is taken into account, operating revenue would have increased by 2.6 %. The mobile business grew by 7.8 % due to positive revenue from terminal equipment business and ongoing customer additions.
Wholesale revenue was down at the end of September 2022 by 0.7 % year-on-year. The positive trend in the number of fiber-optic-based lines continued, with an increase of 3.3 % compared with the prior-year period. However, this was not enough to offset the decrease in revenues of 13.7 % from declining volumes of unbundled local loop lines.
Adjusted EBITDA AL, EBITDA AL
Adjusted EBITDA AL increased by EUR 230 million or 3.2 % year-on-year to EUR 7.4 billion. Our adjusted EBITDA AL margin increased to 40.6 %, up from 40.1 % in the prior year. The main reasons for this increase are sound operational development, driven by high-value revenue growth, and enhanced cost efficiency. Lower personnel costs resulting, among other factors, from the smaller headcount and the ongoing implementation of efficiency enhancement and digitalization measures reduced costs.
The special factors affecting adjusted EBITDA AL mainly included the gain on deconsolidation of GlasfaserPlus (EUR 1.7 billion) and initial payments on account received from insurance companies in connection with damage sustained in the catastrophic flooding in July 2021 (EUR 0.1 billion). Expenses for socially responsible instruments in connection with staff restructuring also had an effect. EBITDA AL increased by EUR 1.9 billion to EUR 8.6 billion.
For further information on the joint venture GlasfaserPlus with IFM, please refer to the section “Group organization, strategy, and management.”
Profit/loss from operations (EBIT)
Profit from operations (EBIT) amounted to EUR 5.7 billion, an increase of 51.1 % year-on-year. The positive trend in adjusted EBITDA AL together with the gain on deconsolidation of GlasfaserPlus contributed to this increase. Depreciation, amortization and impairment losses were at the same level as a year earlier.
Cash capex
Cash capex increased by EUR 213 million or 7.9 % compared with the prior-year period. Capital expenditure totaled around EUR 2.9 billion in the first nine months of 2022, in particular for the build-out of the fiber-optic and 5G networks. A total of around 4.5 million households in Germany thus had the option of a direct connection to our fiber-optic network as of September 30, 2021. In mobile communications, our customers benefit from greater LTE and 5G network coverage. Over 93.5 % of German households can already use 5G.