Deutsche Telekom, Europe’s largest telecommunications operator, forecast its earnings this year will continue to grow after a strong 2023, boosted by growth in Germany and the US. 

Adjusted earnings before interest, taxes, depreciation and amortisation after leases is expected to increase about 6 per cent to around 42.9 billion euros (S$62.4 billion) in 2024, the carrier said in a statement on Friday (Feb 23). 

That compares to an average estimate of 44.6 billion euros by analysts surveyed by Bloomberg. Deutsche Telekom traditionally raises guidance throughout the year, and in 2023 increased its forecast earnings three times. 

The Bonn-based mobile operator has bucked trends in the European telecommunications market, posting strong results fuelled by its majority stake in T-Mobile US. The US carrier, which reported its 2023 results in January, has helped contribute to Deutsche Telekom’s plans for 2 billion euros in share buybacks this year and raise its dividend. 

“We had 5.6 million new customers in the US, we are growing in all the markets that we are operating,” chief executive officer Tim Hoettges said in an interview on Bloomberg TV. “This is helping us to better utilise the expensive infrastructure we have invested into, and this is helping us to grow.”

Hoettges said if Deutsche Telekom’s profit targets are met it could raise dividends above the planned 10 per cent increase already announced.

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Shares were down 2.6 per cent to 21.77 euros at 11.54 am in Frankfurt, as telecom shares in Europe broadly traded lower on Friday.

Given the company’s “track record of normally slightly exceeding expectations, the financial targets are reassuring,” Citi analyst Georgios Ierodiaconou said in a note. “The guidance for 2024 implies solid underlying growth in Ebitda which should continue.”

It had customer growth in all areas in Germany last year, adding 300,000 net broadband users and 1.2 million branded contract mobile customers in its home market. In the US, it said it had the largest growth in the industry. BLOOMBERG