EARNINGS PREVIEW: Deutsche Telekom Net Profit Seen +31%
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1319 GMT (Dow Jones) BERLIN--Deutsche Telekom (DT) 3Q net profit seen +31% at EUR667M from EUR508M a year-ago, according to average of 16 analysts polled by Dow Jones. Sales seen +4% at EUR14.6B from EUR14.1B, while EBITDA adjusted for special items seen +5% at EUR4.9B from EUR4.7B. Net debt put at EUR41.1B, after EUR43.3B end-2Q. Analysts to focus on German mobile results and possible cost- cutting plan, US wireless and progress at fixed-line business. Announcement on 04 dividend and dividend policy expected when DT reports Thu. Stock -0.6% at EUR15.11. (TAM/STM)
I don't know where DT's going in the future, but I hope you exercise some extreme caution. If Bush decides to change his policy on the value of the US dollar (which he has to at some point), DT's going to be in deep trouble. The devaluation of the dollar relative to the Euro could cut DT by thirty to forty percent, but it won't happen for a while, but be careful. The reason DT's doing that cost-cutting is because they're losing big money in one of their divisions. I'll try to locate the article and post it.
Like Lynzie, I just humbly stumbled into this stuff too, but I have to disagree with your remarks. As the dollar continues to slide, the value of a Euro-denominated company will only increase. This is what we've seen in the past two years with DT.
All smart companies are cost cutting, including bloated telecom monopolies.
This isn't your usual thoughtful stuff, Troy 48084! If they weren't cost cutting, wouldn't there be bigger cause for alarm?
Under what mechanism would Bush change the value of the dollar? This is mostly in Greenspan territory, and he has already spent the conventional bullets devaluing the dollar. If the dollar devalues, and I agree that it will without help from Bush, why would that hurt DT? I have not seen that the lion's share of DT profit is from its US operations. OIBDA is less than a third of DT earnings, and an eighth of cash flow. After depreciation, DT is in the red, so DT earnings will increase and US debt will decrease as the dollar dives, thus explaining much of the drop in Euro debt already. I am just a simple country boy, but I see DT going up with a controlled drop in the dollar. IMHO. Please provide more detail on your position.