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D. Telekom's Q2 core profit up, beats expectations
(adds CEO comment, details, background)
BONN, Germany, Aug 9 (Reuters) - Strong growth abroad helped Deutsche Telekom (DTEGn.DE) raise second-quarter core earnings by 1.8 percent, beating analysts' expectations despite a continued decline in its domestic fixed-line business.
Earnings before interest, tax, depreciation and amortisation
(EBITDA) adjusted for one-off items rose to 4.9 billion euros
($6.75 billion), the group said in a statement on Thursday.
Europe's largest telecoms group by sales also said revenue rose 2.9 percent to 15.575 billion euros in the quarter.
Adjusted core profit had been expected to come in at 4.722 billion euros, on sales of 15.6 billion euros, according to the average of a Reuters poll of 19 analysts.
Deutsche Telekom reiterated it would meet its 2007 overall outlook for group core earnings this year of around 19 billion euros and moderate sales growth.
"The key message that we want to communicate for the first half of 2007 is that we are right on track to achieve our financial targets," Chief Executive Rene Obermann said.
The Bonn-based company is struggling with a decline in its fixed-line division, which it has been only partly able to compensate for with its growing broadband business. It said in the second quarter it lost 516,000 domestic fixed-line customers and won 448,000 domestic broadband customers.
Revenue at T-Mobile, its key growth driver, rose to 8.65 billion euros and adjusted core profit came in at 2.75 billion euros in the second quarter.
Deutsche Telekom's shares have been sluggish, trading around 13 euros -- below their issue price at the firm's public listing in November 1996. But they trade at around 16 times estimated 2008 earnings per share, higher than France Telecom (FTE.PA) and Telefonica (TEF.MC), which are both valued at around 12 times.
((Reporting by Nicola Leske; Reuters messaging: nicola.leske.reuters.com@reuters.net; +49 69 7565 1214)) Keywords: DEUTSCHETELEKOM EARNINGS/
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