Deutsche Telekom raises annual profit growth outlook to 3%-5% through 2024

  • EBITDA expected to outpace revenue growth by 1-2% per year
  • Adj. EPS seen at more than 1.75 euros in 2024
  • DT to pay 40-60% of the adj. EPS in dividends, with a floor of 0.60 euro

BERLIN, May 20 (Reuters) – Deutsche Telekom (DTEGn.DE) on Thursday raised its medium-term core earnings outlook to growth of 3-5% a year through 2024, while maintaining a revenue forecast of 1 to 2% annual business.

Adjusted earnings per share are expected to reach more than 1.75 euros ($2.13) by 2024, from 1.20 euros in 2020, the Bonn-based telecommunications group said, with operations in Europe and the United States. States before a two-day strategy. presentation.

Management is reportedly proposing a split of 40-60% of adjusted earnings per share, subject to a €0.60 floor introduced in November 2019, after US unit T-Mobile (TMUS.O) agreed to take over the small rival Sprint.

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“We are stepping up our efforts,” CEO Tim Hoettges said, after raising the profit growth target from the 2-4% range set in Deutsche Telekom’s last strategy update in 2018.

“We want to surpass the strong development of recent years and lead the Group into the future with sustainable growth.”

At the midpoint, Deutsche Telekom’s forecast for adjusted earnings before interest, tax, depreciation and amortization (EBITDA) after rents stands at 41 billion euros in 2024, according to a Reuters calculation, compared to a consensus forecast of 42 .3 billion euros in a company survey of analysts.

The company forecasts free cash flow after leases of more than 18 billion euros in 2024, against a consensus view of 16.8 billion euros.

Outlining its priorities, Deutsche Telekom said it would increase the number of households in its European markets using “converged” product packages, covering fixed and mobile, to more than 10 million over the next three years.

It would also increase the coverage of its pure fiber optic network in Germany to 60% by 2030 from 5% currently, while its 5G mobile network would cover 97% of the population by 2030.

($1 = 0.8210 euros)

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Reporting by Douglas Busvine Editing by Riham Alkousaa

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