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Deutsche Telekom 'lost billions' in 2012

Published: 28 Feb 13 08:00 CET | Print version
Online: http://www.thelocal.de/money/20130228-48243.html

German telecommunications giant Deutsche Telekom said on Thursday that multi-billion-euro writedowns in the United States had pushed it into a net loss of €5.255 billion in 2012.

"We recorded a net loss of around €5.3 billion, primarily due to the recognition of an impairment loss" of €7.4 billion on T-Mobile USA, Deutsche Telekom said in its 2012 annual report. In 2011, it booked a year-end profit of €557 million euros.

The loss in the US - announced last October - has prompted the company to push for a merger of T-Mobile US with the mobile phone operator MetroPCS.

The multi-national company, which employs 230,000 workers worldwide, said massive losses in 2012 would not effect its projected business outlook for this year, which predicts an end-of-year operating profit of €17.4 billion.

In January, the Handelsblatt newspaper reported the Bonn-based telecommunications giant was planning to cut jobs 1,200 jobs in Germany by June in a bid to cut overhead costs by ten percent and save €100 million a year.

Employees would be cut from its marketing, management and administration departments, inside sources told the paper at the time, in a move the company described as "reorganization" rather than a downscaling operation.

AFP/The Local/jlb

What do you think? Leave your comment below.


Your comments about this article:

#1
09:07 February 28, 2013 by zeddriver
Or DT could try retaining customers through the outlandish concept of "customer satisfaction". Aspiring to be just like the Borg drones on star trek is probably not the best way to endear your self to customers.
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#2
10:33 February 28, 2013 by raandy
No doubt , If DT does business in the US like they do here ,it is understandable. Service in the US is everything while it is nothing here.
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#3
13:21 February 28, 2013 by Darra
Nothing is real in the financial world :) They didn't lose it.

"We recorded a net loss of around €5.3 billion, primarily due to the recognition of an impairment loss"

By definition "An impairment write-down reduces an overstated book value to fair value."

Book value is kind of "the cost of an asset minus the accumulated depreciation."

So you state it one way, then depreciate it, then recognize that the market value depreciates faster than you have done it , then ...

Of course ,if you are a regular person, who only has income from salary, you can not depreciate anything in order to avoid taxes :) Technically, everything that you bought from a store, depreciated or completely lost it's value , but you still pay tax on the whole salary, not the current value of the hosehold goods that you have purchased

But of course, I am not a financisit , so that might not be true either
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#4
16:16 February 28, 2013 by rugbycoach
Darra is indeed correct, it is a paper write down, not cash.
Report abuse »
#5
15:43 March 1, 2013 by reallybigdog
Not to mention a nominal anticipated operating profit of 17 billion which would retire the debt of some countries.
Report abuse »
#6
00:29 March 2, 2013 by zeddriver
Oh I see. It's kind of like when the government says they are going to increase taxes by 15% then decreases the increase to 10%. Then calls it a tax cut.
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