Deutsche Telekom Unexpectedly Posts Quarterly Loss
Deutsche Telekom AG, Europe's largest telephone company, reported an unexpected fourth-quarter loss on additional costs to cut jobs.
The net loss was 757 million euros ($1.14 billion), compared with an 898 million-euro loss a year earlier, Deutsche Telekom said in a statement handed out today at its headquarters in Bonn. Sales slipped 0.6 percent to 15.8 billion euros.
Chief Executive Officer Rene Obermann is in the midst of cutting 32,000 jobs as Deutsche Telekom loses fixed-line clients in Germany and faces price cuts in the U.S. by AT&T Inc. and Verizon Communications Inc. Deutsche Telekom took a 1.4 billion- euro charge related to its job-cut program in the quarter.
``The fixed-line business in Germany remains the biggest issue as the line loss will continue,'' said Ulrich Trabert of Bankhaus Metzler in Frankfurt, who has a ``buy'' rating on Deutsche Telekom shares, via phone. ``All in all the numbers are in line, but the personnel charge is the surprise.''
Profit had been predicted at 665 million euros on revenue of 15.9 billion euros, the median estimates of 12 analysts Bloomberg surveyed via phone and e-mail.
Fourth-quarter net income, excluding gains and losses, fell 1.9 percent to 808 million euros, beating the 764 million-euro average estimate in the survey. In the year-earlier quarter, Deutsche Telekom had one-time costs of 1.7 billion euros, mostly from job cuts.
2008 Forecast
Deutsche Telekom today forecast that earnings before interest, taxes, depreciation and amortization, excluding some items, will be around 19.3 billion euros this year, little changed from 2007, reiterating its Nov. 8 prediction that the measure will remain ``stable'' in 2008. Real-Time Kurse |