First half of 2010: 3G leads the way

• Number of customers increased slightly
• Total revenues exceed CZK 14.6 billion
• ARPU amounts to CZK 421

Prague, 5 August 2010 - In the first half of 2010, T-Mobile Czech Republic continued to expand its services in the field of mobile and fixed telephony and ICT. The results for the reporting period are satisfactory despite the ongoing impact of a series of negative factors, such as the slow stabilization of the economy, increasing competition and strengthening regulation. In the first half of the year, T-Mobile introduced a number of interesting new tariff plans, as well as many innovative services which provide more possibilities for using mobile phones.

Customer base increased slightly
At the end of June 2010, T-Mobile registered nearly 5.5 million mobile customers. On a year-on-year basis, the number of mobile customers increased by 0.6%. The number of contract customers increased by 5% to 2.7 million, which is a 50% share of the entire customer base. The key factor contributing to the increased popularity of tariff plans was the introduction of the 2v1 ("2in1") plan combining fixed internet access and mobile voice services, the GRAND unlimited voice plans, the new Přátelé (Friends) tariff plans and new services intended for business customers - Profi and Tým (Team) plans. The negative difference in net adds in 2010 was influenced mainly by strong marketing campaigns in the first half of 2009.

The impact of the recession was still noticeable in the second quarter of 2010, particularly in the business sector. Despite this fact, T-Mobile managed to win or retain a number of important business clients - e.g. OVB Allfinanz, a.s., NOWACO Czech Republic s.r.o., Deloitte Advisory s.r.o., the Zlín region or the Notarial Chamber of the Czech Republic.

In the fixed services segment, T-Mobile offers primarily ADSL access, which is used by more than 49 000 customers, and fixed-voice services offered especially to companies as part of the T-Mobile ProfiNet solution. The operator's fixed-voice services are used by approximately 350 companies. In March, the modular ProfiNet solution was extended with another ICT service - Equipment Supply and Administration.

Mobile only customers	Q2/09	Q2/10	% y/y	H1/09	H1/10	% y/y
Customers	5,433	5,464	0.6 %	5,433	5,464	0.6 %
- Contract	2,599	2,730	5.0 %	2,599	2,730	5.0 %
- Prepaid	2,834	2,734	-3.5 %	2,834	2,734	-3.5 %
Net adds	22	16	-27.3 %	11	8	-27.3 %
- Contract	55	30	-45.5 %	99	78	-21.2 %
- Prepaid	-33	-14	57.6 %	-88	-70	20.5 %
Average monthly churn	1.2 %	1.3 %	0.1 pp	1.4 %	1.3 %	-0.1 pp

Financial results - integrated
In the first half of 2010, T-Mobile reported total net revenues of approximately CZK 14.7 billion, which represents a year-on-year decrease of 7.6%. The adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) declined to approximately CZK 7.1 billion. The ARPU indicator for the mobile services (average monthly spending on telecommunications services) amounted to CZK 421. The decrease of financial indicators was caused particularly by strong impacts of the EU regulatory measures as well as fierce price competition in the highly saturated Czech market. These negative effects could partly be compensated by a grown contribution of the fixed-line services.

	Q2/09	Q2/10	-% y/y	H1/09	H1/10	% y/y
Total revenues integrated (CZK million)	8,283	7,453	-10.0 %	15,878	14,669	-7.6 %
Adj. EBITDA integrated (CZK million)	4,834	3,577	-26.0 %	8,352	7,066	-15.4 %
ARPU - mobile services (CZK)	492	426	-13.4 %	472	421	-10.8 %
- Contract	807	681	-15.6 %	781	676	-13.4 %
- Prepaid	207	173	-16.4 %	197	170	-13.7 %
Non-Voice % of ARPU - mobile services	21 %	23 %	2 pp	22 %	23 %	1 pp

Services marked by innovations
The integrated character of the company is reflected in the launch of new tariff plans: in January, T-Mobile introduced a converged offer of the 2v1 tariff plans combining mobile-voice services and ADSL access. The unlimited Grand and Profi plans, as well as the new generation of the Přátelé plans have also become very popular. Young customers particularly appreciated the extra free access to 300,000 songs which can be downloaded with no extra charge as part of the BAV SE tariff plan.

T-Mobile also introduced many innovative services: it started testing the NFC (Near Field Communication) technology, launched the first Czech on-line PC games rental service and offered the simple and useful Contacts Backup service. In the first half of the year, the operator continued to develop its activities in the field of mobile marketing: it organized a campaign which guaranteed the success of this type of advertising and successfully tested a promotion based on geographical indicators.

The overall upgrade of the 2G network and intensive coverage of the country's territory with the 3G signal was a technological priority in the first half of 2010. Currently, the fast mobile data service is available in eight cities - Prague, Brno, Plzeň, České Budějovice, Olomouc, Pardubice, Zlín and Hradec Králové. Other locations will follow in the coming months: the operator wants to cover 30 cities by the end of the year.

Corporate social responsibility
T-Mobile is a company that wants to conduct business responsibly with respect to the society in which it operates. In the first half of 2010, this was reflected particularly in the introduction of a service consisting in blocking illegal content on websites, active participation in Earth Hour and a special offer for people affected by the spring floods.

For more information about other new services and technologies introduced within the first half of 2010, please go to www.en.t-press.cz/tiskove_zpravy/.

T-Mobile Czech Republic, a member of the international telecommunications group Deutsche Telekom, has almost 6.2 million customers, the number-one operator in the Czech market. T-Mobile is an integrated operator: in addition to telecommunications services, it offers comprehensive ICT solutions not only for companies, but also for other organizations and individuals. It provides outstanding services in the high-speed network, which was proved repeatedly by benchmark testing performed by umlaut (former P3) with Best-in-Test seal.

T-Mobile Czech Republic places emphasis on taking a responsible approach to the environment and society. It adheres to fair business practices, helps beneficial applications and services to see the light of day, supports non-profit organizations, small businesses and individuals, and lends a helping hand whenever crisis situations arise. The company’s employees serve as volunteers in many places across the entire Czech Republic.

More information about the company is available at www.t-mobile.cz, www.t-press.cz (the portal for journalists) and www.t-mobile.cz/pomahame (information on the company’s CSR activities).

Contact details of the press unit: press@t-press.cz.