Deutsche Telekom reports losses for the second consecutive year

by Paul Wilson | Friday, Feb 24, 2012 | 380 views

Deutsche Telekom declared its results for the quarter ended December 2011. Deutsche Telekom reports a loss of €1.34 billion ($1.77 billion) in the fourth quarter. That’s more than double the losses from a year ago. The company had huge write offs during the year due to severe losses from its US and Greece businesses. Those write downs more than wiped out a cash payment from AT&T because its deal to buy T-Mobile USA from Deutsche Telekom fell through. The company has lost over 180,000 customers in over the past six months. The company has planned to introduce high speed wireless data transfer based on long term technology. Commenting on this CEO Rene Obermann “We are currently under pressure on the customer side, nonetheless let’s not forget it’s a valuable asset,” “We will make the company more competitive, and therefore we’re planning to make an additional investment into the network technology and at the same time we look for structural options.”

The company is looking at getting a strategic investment over the long run. This will help the company reposition itself in the future. “In the long run we’re also looking at structural options to mitigate” the relative lack of scale of the business, including a “self-funding platform,”

We maintain a sell on the stock as the company is not profitable at the moment. This could add more pressure on the stock in the near term. The company’s proposed plan of merger with AT&T also fell through depriving the company of much needed fund infusion. The German company received a breakup fee from AT&T of 2.3 billion Euros in cash and wireless spectrum valued at about 900 million Euros.

Like it? Share it!

Leave A Response