Deutsche Telekom Ag S/Adr

Good afternoon and welcome to Deutsche Telekom's conference call. This conference is live-streamed and recorded on YouTube. May I now hand you over to Mr. Anders Wittig.

Thank you. Good afternoon, everyone, and welcome to our live 2023 Q3 2022 webcast and conference call. As you can see with me today are our CEO, Tim Hutkes, and our CEO, CFO, Christian Illig. Tim will first go through a few highlights, followed by Christian, who will talk about the segments of our group financials. After this, we have time for M&A. Before I hand over to Tim, please pay attention to our usual disclaimer, which you will find in the presentation. And now it's my pleasure to hand over to Tim.

Thank you, Hannes. How are you? I hope you're doing all well in these difficult times. We are happy to share with you another very strong quarter. By the way, on both sides of the Atlantic and another increase in our guidance. Of course, our dividend proposal for 22 is coming with the third quarter, which is 70 cents up by nearly 10% year over year. T-Mobile US reported strong growth in all metrics and raised their guidance for this year once more again. But we delivered as well outside of the US quite strong numbers. Strong customer and service revenue growth, 4.3% organic EBITDA growth, and already over 4 billion free cash flow after nine months in the European operations. As usual, I will go through our year-to-date performance, and Christian will then show you the details of the quarter. Let me start with the organic view on the next page. Our strong growth continued and all segments contributed. Organic service revenues for the group are up by 4% so far this year. For our European business, service revenues are up 1.8%. For the group organic, group EBITDA grew by 0.7%. And excluding T-Mobile's handset lease unwind, group adjusted core EBITDA grew by 5.9%. By the way, if you just look to the realistic dollar numbers, we have over the first nine months 8.8% growth on the revenues and 8.5% on the EBITDA growth. By the way, on the core EBITDA, even more, 12.2%. And you see that, you know, we are lucky to be in the U.S. It was the right decision to do this. And the strong dollar is helping us big time as well. But nevertheless, we adjust this for the purpose of comparison. But I don't see that the dollar is going back again. But that is a side comment. T-Mobile US headline is slightly down, but without the ongoing unwind of our handset lease, this would have been 7% growth, according to IFRS. Germany remains strong with 3.2% growth. The European segment grew by 3.9% year-to-date, and this despite the headwinds from energy costs and the Hungarian techs. Group development grew by 21%. This would have been around 9% without health for sale accounting. Anti-systems grew by 10% year-to-date. Germany has now delivered 24 consecutive quarters of EBITDA growth. By the way, this is six years. And Europe with 19 consecutive quarters. Our network build-out continues at an accelerated pace. We now pass over 12 million European homes with FTTH. Of this now 4.5 million in Germany, we are well on track for the planned 2 million additional fiber homes this year. Our ultra-capacity 5G network passes 250 million US homes way ahead of competition and well on track for the 260 by end of this year. While we extend the reach, we are also increasing the spectrum depth from 120 MHz currently to 200 MHz of mid-band in 2023. Speaking of networks, T-Mobile substantially completed the decommissioning of the Sprint network this quarter, one year ahead of schedule. In Germany, we now cover 94% of the population. With 5G in the European segment, we stand at 41%. Our investments continue to pay off and our customer growth remains strong. It was even stronger than last quarter. Our mobile customer growth accelerated on both sides of the Atlantic. Our fixed line growth was a bit slower, partially due to the temporary impact of the new German Telkom law. But as you will see later, our broadband customer growth accelerated again this quarter. Moving on with ESG. On October 12, we hosted our Sustainability Day with the full management team. And by the way, more than 200 investors joined us. We outlined our ambitions, our clear commitment, and how we will actually walk the talk. We made a few material announcements, for instance, that we now expect to reduce energy consumption for our European businesses in 2020 to 2024 timeframe. Our previous target had been to keep consumption stable. I'm pleased to report that year to date we achieved an 11% reduction in energy consumption in Germany compared to 2021. we also announced that we will source half of our European electricity from green PPAs by 2025. And that all new business cars in Germany will from now on be electric. From our Capital Markets Day, you know how we measure ourselves against our financial targets with green, yellow and red traffic lights. I can assure you that we will apply the same strict discipline to measure things, to implement things, to execute things. ESG is now a target for all leaders in their compensation and we will be as disciplined as to the other KPIs on the ESG targets. We will follow up with you as soon as possible. Going to the US, T-Mobile raised their 2020 guidance two weeks ago. Today, we are also raising our full-year guidance for the group for the third time this year. You can see our new guidance on page 8. For the group, we now expect an adjusted group EBITDA of more than $37 billion. By the way, if you take it in dollars, it's more than 40 billion. And our adjusted EPS of more than 1,50 euro. For group free cash flow, we reiterate more than 10 billion. We continue to expect 3.8 billion outside of the U.S. When looking at these numbers, please keep in mind that our 22 guidance is based on a US dollar exchange rate of 1.18, while consensus is based on 1.05. Also remember that our guidance excludes the first quarter contribution from T-Mobile Netherlands. This was 190 million EBITDA. And it includes any held-for-sale effects. With that, let me hand it over to Christian for his deep dive into another successful quarter.