Highlights in the second quarter of 2017

OUTLOOK FOR 2017 REVISED

Following the better than expected development of business in the United States, we are revising our forecast upwards for the United States operating segment and the Group as a whole. We now expect adjusted EBITDA of around USD 10.3 billion, up from around USD 10.2 billion. The forecast for the Group is thus also being revised upwards from around EUR 22.2 billion to around EUR 22.3 billion.

CORPORATE TRANSACTIONS

In an accelerated book-building process as of June 23, 2017, we placed the remainder of our direct stake of 9.26 percent in Scout24 AG – which until that point had been accounted for using the equity method – on the market at a price of EUR 32.20 per share. The proceeds from the sale amounted to EUR 319 million.

On June 14, 2017, we completed the sale of DeTeMedien to a consortium of medium-sized publishers. By agreement, the purchase price remains confidential. It comprises a cash component as well as other elements, including a settlement of the dispute with the buyers, who for several years have pursued legal proceedings concerning the level of charges for subscriber data. In addition, the publishers have assumed the obligation to publish subscriber directories.

DIVIDEND

Acceptance rate for dividend in kind at record level. In 2017, we again offered our shareholders the option of converting the dividend for the 2016 financial year into Deutsche Telekom AG shares instead of receiving it as a cash payment. The option was exercised for a total of around 49 percent of the shares carrying dividend rights. This led to around 85 million new shares being issued and kept cash of some EUR 1.4 billion in the Group. The cash dividend paid out to our shareholders who did not choose this option also totaled around EUR 1.4 billion.

SPECTRUM INVESTMENT

In the spectrum auction that ended in April 2017, T-Mobile US acquired a total of 1,525 licenses for 600 MHz spectrum – 31 MHz on average nationwide – for a purchase price of USD 7.99 billion. In April 2017, T-Mobile US signed an agreement with a third party for the exchange of spectrum licenses. The transaction is expected to be closed in the second half of 2017.

PARTNERSHIPS

Toll4Europe GmbH commences business activities. In April 2017, T-Systems together with Daimler AG and DKV EURO SERVICE GmbH + Co. KG established Toll4Europe GmbH for the development and provision of a European Electronic Toll System (EETS) for vehicles over 3.5 metric tons. T-Systems owns 55 percent of Toll4Europe and governs the business. A toll box that can be used across Europe is scheduled to be launched on the market in 2018. The box is to initially cover Austria, Belgium, France, Germany, and Poland. Hungary, Italy, Portugal, and Spain are also to be incorporated by market launch or as soon as possible thereafter.

Membership in the Industrial Data Space Association (IDSA). In February 2017, we joined the Industrial Data Space Association e.V. (IDSA). The non-profit association has set itself the goal of advancing the general conditions for a digitally connected economy and to establish secure exchange of data; we are primarily contributing our security expertise. The initiative was founded by representatives from the worlds of research and industry.

NEW PRODUCTS, RATE PLANS, AND SERVICES

StreamOn: revolutionizing the mobile market. Consuming music and videos free from worries anytime and anywhere – this is what more and more people want. We are now fulfilling this desire in Germany and since April 2017, we have been offering a real revolution with StreamOn. The new option for certain rate plans now enables Magenta customers to listen to music and watch video content (clips, movies, series) from participating partners on their smartphone while on the move without it affecting the high-speed data volumes included in their contract.

StartTV – The simple way to switch to digital TV. In May 2017, we expanded our TV range to include StartTV, making it simple and affordable to switch to digital television: from just EUR 2 a month StartTV offers some 100 channels,of which 22 are in HD quality, a clearly structured program guide, and a smart search function. Additional HD channels and EntertainTV mobile can also be purchased for on the go.

AWARDS

The illustration below shows the main awards received in the second quarter of 2017. For details on more awards, please go to www.telekom.com/media.

Graphic: Awards