Financial Results 2003

Spirit. Commitment. Success. That's the motto of Deutsche Telekom's 2003 Annual Report which was published on March 30, 2004.

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• Net revenue increased by 5.4 percent year-on-year from EUR 39.2 billion to EUR 41.3 billion in the first nine months.
• Net income in third quarter of 2003 up by EUR 21.1 billion year-on-year to EUR 0.5 billion; year-on-year increase of EUR 26.1 billion in the first nine months to EUR 1.6 billion.
• Group EBITDA1 in third quarter of 2003 up by 22.5 percent year-on-year from EUR 3.8 billion to EUR 4.7 billion; year-on-year increase in the first nine months of 25.6 percent from EUR 11.4 billion to EUR 14.3 billion.
• Adjusted Group EBITDA1 increased for seven consecutive quarters; up 12.1 percent year-on-year from EUR 4.2 billion to EUR 4.7 billion in the third quarter and by 15.3 percent from EUR 12.0 billion to EUR 13.8 billion in the first nine months.
• Net debt EUR 49.2 billion at September 30, 2003; “6+6 program” successfully completed ahead of schedule.
• Free cash flow2 before dividend more than increased significantly from EUR 4.7 billion to EUR 7.4 billion.
• Investments in property, plant and equipment and intangible assets (excluding goodwill) reduced from EUR 5.3 billion to EUR 3.5 billion in a year-on-year comparison of the first nine months.

1 Deutsche Telekom defines EBITDA as the results from ordinary business activities excluding other taxes, net financial income/expense, amortization and depreciation. A detailed explanation of the special factors affecting EBITDA, adjusted EBITDA and the adjusted EBITDA margin can be found under “Reconciliation of pro forma figures”. 2 Deutsche Telekom defines free cash flow as cash generated from operations minus interest payments and cash outflows for investments in property, plant and equipment and intangible assets (excluding goodwill). For the calculation of free cash flow please refer to “Reconciliation of pro forma figures”.

• Group revenue increased by 5.7 percent year-on-year to EUR 27.2 billion in the first half-year
• Net income up by EUR 5.0 billion to EUR 1.1 billion
• Adjusted EBITDA increased to a greater extent than revenue, by 17 percent compared with prior-year period to EUR 9.1 billion
• Free cash flow improved from EUR 2.8 billion to EUR 4.0 billion
• Net debt reduced by EUR 11.3 billion to EUR 53.0 billion compared with EUR 64.3 billion as of September 30, 2002
• The Board of Management aims to reinstate dividend payments for the 2004 financial year

• Net income of EUR 0.85 billion in the first quarter 2003 compared with net loss of EUR 1.8 billion in the same period 2002
• Net debt reduced to EUR 56.3 billion by end of March compared with EUR 61.1 billion at the end of 2002 Revenue increased by 6.6 percent to EUR 13.6 billion
• EBITDA improved by almost 30 percent to EUR 4.9 billion, EBITDA excluding special factors increased by a good 18 percent to EUR 4.5 billion
• Net cash provided by operating activities increased by 36 percent to EUR 3.1 billion; free cash flow increased by almost a factor of six to around EUR 2 billion
• Goal for EBITDA (excluding special factors) set at EUR 17.2 billion to EUR 17.7 billion for the full financial year compared with previous plan of EUR 16.7 billion to EUR 17.7 billion