T-Systems Starts the Year with Strong Order Entry
BONN and FRANKFURT, Germany, May 8, 2013
BONN and FRANKFURT, Germany, May 8, 2013 /PRNewswire/ --
*Profitability boosted further.
*External revenue virtually stable despite fierce competition.
It is important to remember that mid-2012 Deutsche Telekom consolidated
external business under T-Systems in what is known as the Market Unit and
pooled all of the Group's internal IT departments in a separate unit called
Telekom IT. The latter aims to save costs for the Group and provides internal
IT services by billing only cost, no longer margins. The Market Unit is
responsible worldwide for serving Deutsche Telekom's corporate customers and
operates in accordance with the principles of revenue and margin growth.
The positive trend for T-Systems in the fourth quarter of 2012 is continuing.
In the first quarter of 2013, Deutsche Telekom AG's Systems Solutions segment
recorded strong order entry of EUR2.1 billion, up 33 percent compared with
the prior-year period. This was due to agreements with EADS and the Swiss
National Railways (SBB) as well as numerous deals for cloud services.
In the area of intelligent networks, T-Systems concluded further strategically
important agreements and partnerships. The Deutsche Telekom subsidiary is
working with BMW and Sixt to bring hotspots to the car from this summer and,
for Daimler, it is developing the communications infrastructure for online
services in the car.
External revenues remained almost stable at EUR1.6 billion in what was a
difficult competitive environment characterized by price pressure. By
contrast, in the Telekom IT unit, which comprises the Group's internal IT
business in Germany, revenue fell as expected, falling to 25 percent below the
prior-year level due to seasonal effects. The EBIT margin of the Market Unit,
which manages Deutsche Telekom's corporate customers worldwide, increased from
minus 0.7 percent in the prior year to 0.4 percent. This is the result of
efficiency enhancement measures, as well as of improvements in numerous new
agreements from the past year.
Systems Solutions operating segment*:
Q1 2013 Q1 2012 Change FY 2012
millions millions % millions
of EUR of EUR of EUR
Order entry 2,098 1,577 33.0 8,737
Total revenue 2,319 2,456 (5.6) 10,016
Net revenue 1,607 1,624 (1.0) 6,609
EBIT (66) (58) (13.8) (307)
Adjusted EBIT 8 (13) n.a. 110
Adjusted EBIT margin 0.4% (0.5)% 0.8p 1.1%
EBITDA 115 97 18.6 342
Adjusted EBITDA 175 142 23.2 747
Adjusted EBITDA margin 7.5% 5.8% 1.7p 7.5%
Number of employees (average) 51,598 52,510 (1.7) 52,742
Comments on the table:
As of January1, 2013, Regional Services and Solutions (RSS) was relocated
from the Systems Solutions operating segment to the Germany operating segment
with the aim of combining the market approach.
This media information contains forward-looking statements that reflect the
current views of Deutsche Telekom management with respect to future events.
These forward-looking statements include statements with regard to the
expected development of revenue, earnings, profits from operations,
depreciation and amortization, cash flows, and personnel-related measures.
They should therefore be considered with caution. Such statements are subject
to risks and uncertainties, most of which are difficult to predict and are
generally beyond Deutsche Telekom's control. Among the factors that might
influence our ability to achieve our objectives are the progress of our
workforce reduction initiative and other cost-saving measures, and the impact
of other significant strategic, labor, or business initiatives, including
acquisitions, dispositions, business combinations, and our network upgrade and
expansion initiatives. In addition, stronger than expected competition,
technological change, legal proceedings, and regulatory developments, among
other factors, may have a material adverse effect on our costs and revenue
development. Further, the economic downturn in our markets and changes in
interest and currency exchange rates, may also have an impact on our business
development and the availability of financing on favorable conditions. Changes
to our expectations concerning future cash flows may lead to impairment write
downs of assets carried at historical cost, which may materially affect our
results at the group and operating segment levels. If these or other risks and
uncertainties materialize, or if the assumptions underlying any of these
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offer no assurance that our estimates or expectations will be achieved.
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presents non-GAAP financial performance measures, including, among others,
EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, adjusted EBIT,
adjusted net income, free cash flow, gross debt, and net debt. These non-GAAP
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