Deutsche Telekom Turns To Profit In FY13, Orange Profit Surges

(RTTNews) - German telecom giant Deutsche Telekom AG (DTEGY.PK) Thursday reported a profit for full-year 2013, compared to a loss last year. Last-year results included special items, particularly impairment loss related to business combination of T-Mobile US and MetroPCS. For the fourth quarter, the firm posted a net loss, while adjusted profit increased year-over-year.

French telecom major Orange SA (ORAN), previously France Telecom, said its 2013 profit more than doubled from last year, reflecting a significantly lower level of goodwill impairment in 2013.

Orange Group share of consolidated net income was 1.87 billion euros, significantly up from 820 million euros in the prior year. In 2013, restated EBITDA totaled 12.65 billion euros, while it was 13.67 billion euros last year, on a comparable basis.

For the year, Orange reported consolidated revenues of 40.98 billion euros, down 4.5 percent on a comparable basis, of which over 40 percent was due to impact of regulatory measures. Excluding this, revenues slid by 2.6 percent.

Orange expects restated EBITDA for 2014 to range between 12.1 and 12.6 billion euros.

Orange also announced payment of a dividend of 0.60 euros per share for 2014, while an interim dividend for 2014 of 0.20 euros per share would be paid in cash in December. In addition, the Group confirmed the payment of the balance of the dividend for 2013 of 0.50 euro per share which, payable in cash on June 5, 2014.

For the fourth quarter, Deutsche Telekom posted a net loss of 752 million euros, compared to a profit of 641 million euros in the previous year.

On an adjusted basis, net profit amounted to 355 million euros, while the firm posted 200 million euros in adjusted profit last year. The company has adjusted its prior-year comparatives.

Earnings before interest, taxes, depreciation and amortization, or EBITDA, from Deutsche Telekom declined 31.2 percent to 3.26 billion euros. Adjusted EBITDA totaled 4.06 billion euros, while it was 4.01 billion euros a year ago.

Quarterly net revenues grew 6.5 percent 15.67 billion euros from 14.71 billion euros last year, driven by the first-time inclusion of MetroPCS as of May 1, 2013. Organic growth was 2.8 percent.

During the quarter, Deutsche Telekom gained 638,000 mobile contract customers. T-Mobile US Inc. (TMUS), the combined company resulting from the combination of MetroPCS Communications Inc. and T-Mobile USA Inc., added 4.4 million new customers in 2013.

For full-year 2013, Deutsche Telekom reported a profit of 930 million euros, compared to a loss of 5.35 billion euros last year. Adjusted net profit was up 8.6 percent to 2.8 billion euros. Net revenues grew 3.4 percent to 60.13 billion euros.

Tim Höttges, CEO of the company said, "The figures for 2013 underscore that Deutsche Telekom is now ideally positioned to become the leading European telecommunications provider. Our results lay the perfect groundwork for 2014."

For 2014, free cash flow is expected to be about 4.2 billion euros, compared with a reported value of 4.6 billion euros a year ago. Revenue growth and EBITDA of 17.6 billion euros are anticipated for 2014.

In addition, Deutsche Telekom is reducing its target for free cash flow in 2015, previously set at around 6 billion euros.

The company also said its Supervisory Board and the Board of Management will propose to the shareholders' meeting on May 15 a dividend of 0.50 euros per share.

On Frankfurt's Xetra, Deutsche Telekom shares closed Wednesday's trading at 12.20 euros.

In Paris, Orange stock ended at 9.17 euros.