T-Systems’ first quarter results 2008
Frankfurt am Main, May 08, 2008
T-Systems modified its reporting structure to reflect its operational realignment starting in the first quarter of 2008. As a result, reporting will no longer show Enterprise and Business Services. The previous Business Services unit is now fully integrated in Telecommunications. The two other units, Computing & Desktop Services and Systems Integration, have been retained and are not affected by this measure.
Business outside Germany grew by 3 percent to EUR 593 million in the first quarter of 2008. By contrast, revenue in Germany decreased by 13.7 percent to EUR 2.0 billion. As such, the Business Customers segment posted an overall decrease of 10.4 percent to EUR 2.6 billion. This is mainly the result of the reassignment of Active Billing to T-Home and the deconsolidation of Media & Broadcast. Another factor was the reduction in intra-group revenue, which fell 20.1 percent year-on-year.
This decrease illustrates T-Systems' substantial contribution to Deutsche Telekom's cost-cutting program. Organically, i.e. adjusted for the 2007 revenue from Media & Broadcast and Active Billing, revenue decreased by 5.2 percent in the first quarter of 2008. Net revenue decreased by 7.2 percent to EUR 2.0 billion. Adjusted EBITDA in the first quarter decreased by 21.1 percent as a result of the sustained price and competitive pressures, the deconsolidation of Media & Broadcast and the reassignment of Active Billing to T-Home. The organic EBITDA decrease was 2.4 percent.
The Business Customers segment demonstrated its compelling international growth strategy in the first quarter of 2008 by setting no fewer than three milestones: the strategic partnership with Cognizant as well as major contracts with Royal Dutch Shell and the South African insurer Old Mutual Group.
Business Customers at a glance:
a) The reporting structure has changed due to the organizational changes in the Business Customers operating segment. The former Enterprise Services Telecommunications and Business Services units are reported together under Telecommunications. Prior-year figures have been adjusted accordingly. The former T-Systems Enterprise and Business Services units will no longer be reported.
