Deutsche Telekom: Big loss despite record dividend
Deutsche Telekom presented its annual financial statements this morning. Despite solid growth, the DAX group's outlook is below analysts' high expectations. Shareholders still have reason to celebrate: they will receive the highest dividend payout in the company's history for 2024.
Deutsche Telekom has developed strongly in the past financial year. The telecommunications giant was able to increase its revenue by 3.4 percent to 115.8 billion euros and its operating profit by 6.2 percent to 43.0 billion euros. Free cash flow also developed positively, at 19.2 billion euros, around 20 percent higher than the previous year. At the same time, profit fell from 17.8 billion to 11.2 billion euros. This significant decline can be explained primarily by the positive special effect from the sale of the radio tower in the previous year.
The German telecommunications group is currently benefiting primarily from the outstanding figures of its US subsidiary T-Mobile, which recorded a large influx of new customers in 2024. Its boss Mike Sievert, meanwhile, is planning takeovers of US Cellular, Lumos and Metronet, which should expand the fiber optic presence and further drive the overall expansion of the telecom empire.
After the record year, EBITDA is expected to grow by a further 4.5 percent to 44.9 billion euros in 2025 and free cash flow is expected to be 19.9 billion euros this year. However, these cautious forecasts from the company's management are well below analysts' expectations. The reason for the deviations are different exchange rate assumptions.
The Bonn-based company also sent friendly signals to Telekom shareholders today: They will receive a dividend of 90 cents per share for the past year, which corresponds to a yield of 2.6 percent. A dividend higher than ever. In addition, the company has planned share buybacks of up to two billion euros for 2025.
The cautious outlook is not well received by shareholders. Telekom shares are currently down four percent on the Frankfurt Stock Exchange. However, today's setback is likely to be just a brief respite after the good run of the last year and a half. The fundamental data and the technical chart picture still suggest that the company should be invested in.
Note on conflicts of interest The board member and majority owner of the publisher Börsenmedien AG, Mr. Bernd Förtsch, has directly and indirectly taken positions in the following financial instruments mentioned in the publication or derivatives related to them, which can benefit from any price development resulting from the publication: Deutsche Telekom.
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