A strong performance by its U.S. business helped Deutsche Telekom grow its fourth quarter revenue and narrow its net loss, the German incumbent announced on Thursday.
In the three months to 31 December, Deutsche Telekom recorded a net loss of €110 million, considerably smaller than the €752 million in Q4 2013, while revenue increased 8.5% to €17 billion. The results were driven primarily by T-Mobile US, which saw revenue surge 28.1% on-year to €6.5 billion and EBITDA increase 32.1% to €1.2 billion, thanks to impressive customer additions and the appreciation of the dollar against the euro.
The telco’s domestic business also grew, albeit modestly. Fourth quarter revenue edged up 1.6% to 5.7 billion, while EBITDA increased to €1.89 billion from €1.85 billion.
"It was a strong quarter to close a successful year," said Tim Höttges, CEO of Deutsche Telekom, in a statement. "We have put the Group back on course for growth and will continue rigorously to forge ahead with this path."
Deutsche Telekom ended 2014 with around 150 million mobile customers, compared to 142 million a year earlier. Again, the growth was attributable to T-Mobile US, which added 8.3 million customers during the year.
For the full year, Deutsche Telekom’s group revenue grew 4.2% to €62.7 billion, while net profit tri pled year-on-year to €2.9 billion from €930 million, driven by the partial sale of its Scout24 classified advertising unit. Capex grew 7% to €118 billion, driven by investments in networks and mobile spectrum.
Looking ahead, Deutsche Telekom has targeted annual organic revenue growth of 1%-2% in 2015-2018. It has set its sights on 2%-4% annual organic growth in EBITDA over the same period. For 2015, Deutsche Telekom expects EBITDA to jump to €18.3 billion from €17.6 billion in 2014, driven by T-Mobile US.
By comparison, growth at the telco’s domestic business was more modest. Fourth quarter revenue edged up 1.6% to 5.7 billion, while EBITDA increased to €1.89 billion from €1.85 billion, said Höttges. "Our strategy as an integrated provider makes us the first choice for customers. And our shareholders profit from our growth profile in revenue and earnings performance."
