Year 2009: Broadening the scope

• Almost 5.5 milion customers; nearly 49% of them are post-paid customers
• Intensive growth of data services
• Growth in EBITDA

Prague, 25 February 2010 - The year 2009 presented one of the most challenging periods in T-Mobile's history. The global economic recession and prevailing trends in the telecommunications business - e.g. intense market penetration, growing EU regulatory pressure and strong competition in the Czech market - did not create favorable conditions for further growth. Nevertheless, T-Mobile handled the challenges with honor: the Company introduced a number of new services and maintained its leading position in the mobile segment. Moreover, T-Mobile completed the acquisition of the retail part of České Radiokomunikace's business, which brought the Company to the position of the second largest ADSL provider in the Czech Republic.  

The fourth quarter of 2009 confirmed T-Mobile's position in the Czech market in terms of customer numbers and saw further growth of financial indicators. As of 31 December 2009, the total number of customers using T-Mobile services reached nearly 5.5 million; the number of contract customers approached 2.7 million. Total revenues decreased year-on-year by 5.0% to just under CZK 31.5 billion. In comparison with previous year, EBITDA rose to approximately CZK 16.2 billion and the EBITDA margin reached 51.5%. The ARPU indicator reached the level of CZK 464.

"The environment has never been so challenging, which is all the more reason why we can be more than satisfied with the achieved results. We greatly value the loyalty of our customers and, of course, also the determination and enthusiasm of our employees," says Roland Mahler, Managing Director of T-Mobile Czech Republic.

During the first nine months of the year, the Company introduced a number of innovative services and products such as mobile advertising, naked DSL, free music downloads included in the BAV SE tariff plan and the iPhone 3GS, T-Mobile Pulse and CPA Halo terminals. Moreover, T-Mobile initiated crucial technological and strategic projects: 2G network modernization and construction of optical and 3G networks. In September, T-Mobile became the second largest DSL provider in the Czech Republic by acquiring the retail business of České Radiokomunikace. In December, the operator launched its first ICT product - Virtual PBX for business customers.

Customers: Focus on current customers and loyalty
In comparison with 2008, the number of T-Mobile customers increased by 0.8% to the current 5.46 million. T-Mobile further strengthened its position in the contract customer segment. The number of contract customers reached nearly 2.7 million, representing almost 49% of the customer base. Customers using Twist prepaid services numbered 2.80 million at the end of last year. T-Mobile registered customer additions amounting to 43,000 for 2009.

For the third year in a row, monthly churn (i.e., the number of customers who decided to stop using the operator's services) remained at the same level of 1.4%.

Business clients that T-Mobile gained in 2009 included TOP 09 ANECT, a.s., CISCO SYSTEMS (Czech Republic) s.r.o., ČKD ASSET, a.s., ČSAD JIHOTRANS a.s. and Kraft Foods CR s.r.o.

Financial Results: Strengthening the position
In 2009, the world economy faced a financial crisis that had a negative impact on the telecommunications business as well. Revenues of European operators were influenced also by continuing European Commission regulatory pressure. Despite that, T-Mobile achieved satisfactory financial results. The Company recorded total revenues in the amount of CZK 31.5 billion; ARPU revenues (service revenues) reached CZK 30.2 billion. EBITDA (earnings before interest, taxes, depreciation and amortization) reached CZK 16.2 billion; the EBITDA margin amounted 51.5%. The financial results were positively influenced by an increase in the Company's efficiency and by the settlement of the interconnection dispute with TO2. ARPU (average revenue per user) decreased by 7.2% year-on-year to CZK 464 by the end of December 2009 in spite of the increased share of contract customers, and was affected by the launch of new tariff-plan generations, ongoing transfers to prepaid services and the impacts of regulation. Non-voice services amounted to 23% of ARPU.

Services: Broadening the scope, huge investments in technologies
Data services have been in T-Mobile's focus for several years, but 2009 presented a breakthrough for the Company. T-Mobile started offering a naked ADSL service and the September acquisition of the retail part of České Radiokomunikace's business positioned T-Mobile as the number one alternative DSL provider.

Moreover, the operator further focused on the development of community services - in January it launched the community tariff plans Přátelé and Rodina.

Also in 2009, T-Mobile introduced innovative services - e.g. mobile advertising and exclusive digital music downloads. T-Mobile presented to its customers several exclusive terminals - T-Mobile G1, the first handset supporting the Android operating system, CPA Halo and special communication wristbands for seniors or disabled citizens.

For business clients, T-Mobile launched, among other things, the new Firma SME/VSE tariff plans and fixed-line voice services.

In 2009, T-Mobile invested a large amount of money in the technology and networks that it uses. The Company started full modernization of the 2G network (to be completed by mid-2010) and began the rollout of an optical fiber network. The main contribution to development of data services was represented by the rollout and trial operation of the 3G network based on HSPA technology.

2010: Into new businesses
Even if the end of financial recession cannot be predicted for the near future, Roland Mahler is optimistic: "We are looking forward to the coming months, as there are many interesting challenges and plans in front of us. Our goal is to become the best-performing integrated operator in the Czech market. First of all, this means completing the integration of the acquired business and firmly positioning the Company as an operator offering a full range of telco and ICT services."

T-Mobile's strategy in 2010 includes further intensive development of fixed-line and broadband mobile data services and advantageous tariffs and bundles. Another development line could lead through new services such as mobile advertising and payment, NFC technologies and other value-added services.

	Q4 2009	2009	2008	% y.o.y.
Customers ('000)	5,464	5,464	5,422	0.8
- Contract	2,660	2,660	2,499	6.4
- Prepay	2,804	2,804	2,922	-4.0
Noví zákazníci ('000)	6	43	151	-71.5
- Contract	30	161	272	-40.8
- Prepay	-24	-119	-121	1.6
Average monthly churn (%)	1.5	1.4	1.4	0.0 p. p.
Total revenue (CZK million)	7,585	31,472	33,140	-5.0
ARPU revenue (CZK million)	7,188	30,196	31,997	-5.6
Adj. EBITDA (CZK million)	3,648	16,219	15,811	2.6
Adj. EBITDA margin (total rev.)	48.1	51.5	47.7	3.8 p.p.
Adj. EBITDA margin (ARPU rev.)	50.8	53.7	49.4	4.3 p.p.
ARPU	440	464	501	-7.2
Non-Voice % of ARPU	23	23	22	1 p. p.

Selected press releases

• New tariffs 
• T-Mobile G1 
• Digital music
• Mobile advertising 
• Naked DSL
• Music + BAV SE
• T-Mobile and ČRa contract
• 3G trial
• Virtual PBX   

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.