Deutsche Telekom Plans Dividend Increase and €2 Billion Share Buyback for 2024

Deutsche Telekom Plans Dividend Increase and €2 Billion Share Buyback for 2024

(IN BRIEF) The Board of Management of Deutsche Telekom has announced its plans for shareholder remuneration in the upcoming year. The company intends to increase the dividend for the 2023 financial year to €0.77 per dividend-bearing share, up from €0.70 per share in 2022. Additionally, Deutsche Telekom plans to initiate a share buyback program in 2024, with a total budget of up to €2 billion. This move aims to address the dilution effect resulting from the company’s 2021 capital increase. The dividend increase aligns with the company’s dividend policy, which distributes between 40% and 60% of recurring adjusted earnings per share to shareholders, with a minimum dividend of €0.60. For the 2023 financial year, the Group expects recurring adjusted earnings per share to exceed €1.60, compared to €1.51 in the previous year. These plans are contingent on the Group’s financial performance in 2023, with further details to be provided when the financial figures for the first nine months of 2023 are reported on November 9, 2023. Approval from the Supervisory Board and shareholders will be required for these proposed dividend plans.

(PRESS RELEASE) BONN, 3-Nov-2023 — /EuropaWire/ — The Board of Management of Deutsche Telekom presented its plans for the company’s upcoming shareholder remuneration.

These entail increasing the dividend for the 2023 financial year to 0.77 euros per dividend-bearing share. The dividend paid for the 2022 financial year amounted to 0.70 euros per share.

In addition, the Board of Management plans to buy back shares in 2024 for up to a total of 2 billion euros.

“Our shareholders trust us and have supported our strategy for many years in the expectation that we will wisely use the capital they provide to us. This was also the case back in 2021, when we implemented the capital increase with which we shored up our position at T-Mobile US. At the time, they accepted the resulting dilution of their shareholding in Deutsche Telekom, which we will now make up for to some extent through the share buy-back,” said Tim Höttges.

Dividend to increase for the third time in succession

The planned dividend increase to 0.77 euros per share will allow shareholders to profit from the company’s improved earnings performance. The basis for this is the dividend policy published at the Capital Markets Day 2021, which provides for distribution of between 40 and 60 percent of recurring adjusted earnings per share to shareholders in the form of dividends, with payment of a minimum dividend of 0.60 euros. The Group’s recurring adjusted earnings per share is expected to increase to over 1.60 euros for the 2023 financial year compared with the prior-year figure of 1.51 euros. These figures are each based on the assumption that exchange rates will remain at the same level as in the previous year and take non-recurring effects on earnings into account.

In view of the guidance for earnings per share of over 1.60 euros for 2023, the proposed dividend of 0.77 euros per share is thus in the middle of the intended payout range. Shareholders eligible for tax credits in Germany will not have to pay tax on their dividends.

Starting from the 2020 financial year, when a dividend of 0.60 euros per share was paid, the dividend would thus be raised in the third year in succession. The current price of the T-Share of 20.75 euros would give a dividend yield based on the planned payout of around 3.7 percent.

Share buy-backs reduce dilution effect from 2021 capital increase

At the Capital Markets Day 2021, Deutsche Telekom’s Board of Management had also announced that it would take share buy-backs into consideration in the future. The planned share buy-backs in the coming year amounting to up to 2 billion euros are intended to recoup part of the dilution effect from Deutsche Telekom’s 2021 capital increase.

The Board of Management’s plans for this shareholder remuneration are based on business performance in 2023. On November 9, 2023, Deutsche Telekom will report the Group’s financial figures for the first nine months of 2023.

The Supervisory Board of Deutsche Telekom will resolve on the proposed dividend plans as soon as the definitive business figures for full-year 2023 are available.

The joint dividend proposal by the Board of Management and the Supervisory Board for the 2023 financial year is subject to approval by the shareholders’ meeting and to fulfillment of other legal conditions.

IMPORTANT INFORMATION: This media information has been prepared solely for information purposes and does not constitute an offer of or a solicitation by or on behalf of Deutsche Telekom AG to subscribe for or purchase securities of Deutsche Telekom AG or as described herein. Any statements and information herein, including forward-looking statements, are not binding and are subject to change without notice at any time. The documents and information contained on this page are not an offer of securities in the United States of America. Securities may not be offered or sold in the United States of America or to “U.S. person” as defined in the U.S. Securities Act of 1933, as amended (the “Securities Act”) or for the account of “U.S. persons” absent registration or an exemption from registration under the U.S. Securities Act. The securities are not and will not be registered as per the U.S. Securities Act.

This media information contains forward-looking statements that reflect the current views of Deutsche Telekom management with respect to future events. They are generally identified by the words “expect,” “anticipate,” “believe,” “intend,” “estimate,” “aim,” “goal,” “plan,” “will,” “seek,” “outlook,” or similar expressions and include generally any information that relates to expectations or targets for revenue, adjusted EBITDA, or other performance measures. Forward-looking statements are based on current plans, estimates, and projections, and should therefore be considered with caution. Such statements are subject to risks and uncertainties, most of which are difficult to predict and are generally beyond Deutsche Telekom’s control. They include, for instance, the progress of Deutsche Telekom’s staff-related restructuring measures and the impact of other significant strategic or business initiatives, including acquisitions, dispositions, and business combinations. In addition, movements in exchange rates and interest rates, regulatory rulings, stronger than expected competition, technological change, litigation and regulatory developments, among other factors, may have a material adverse effect on costs and revenue development. If these or other risks and uncertainties materialize, or if the assumptions underlying any of these statements prove incorrect, Deutsche Telekom’s actual results may be materially different from those expressed or implied by such statements. Deutsche Telekom can offer no assurance that its expectations or targets will be achieved. Without prejudice to existing obligations under capital market law, Deutsche Telekom does not assume any obligation to update forward-looking statements to account for new information or future events or anything else. In addition to figures prepared in accordance with IFRS, Deutsche Telekom presents alternative performance measures, e.g., EBITDA, EBITDA AL, EBITDA margin, adjusted EBITDA, adjusted EBITDA AL, adjusted EBITDA margin, Core EBITDA, adjusted EBIT, adjusted EBIT margin, adjusted net profit/loss, adjusted earnings per share, free cash flow, free cash flow AL, gross debt, and net debt. These measures should be considered in addition to, but not as a substitute for, the information prepared in accordance with IFRS. Alternative performance measures are not subject to IFRS or any other generally accepted accounting principles. Other companies may define these terms in different ways.

Andreas Leigers

Media Contact:
+49 228 181 49494

SOURCE: Deutsche Telekom AG


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