Telekom an anchor of stability in uncertain times: Tim Höttges

Stable and reliable is how CEO Tim Höttges described Deutsche Telekom at the 2022 shareholders’ meeting. It was the first time since 2019 that the Company had invited shareholders to an in-person shareholders’ meeting, this year held at the World Conference Center Bonn.

“A responsible company. A successful company. An anchor of stability. Particularly in uncertain times,” said Höttges, citing stability as a hallmark of the Company’s networks. “We were the digital backbone throughout the pandemic. Our networks always kept running smoothly.”

Deutsche Telekom also firmed up its build-out target for fiber-optic infrastructure in Germany. Until now, the Group was planning to build 10 million FTTH (fiber to the home) lines by 2024. Together with GlasfaserPlus, a company established by Deutsche Telekom jointly with the Australian investor IFM, the target has now been raised to well over 10 million. Deutsche Telekom’s 5G network now covers 91 percent of the German population.

Höttges added that stability means identifying and managing risks early on. As an example, he mentioned rising energy prices. “We hedged the prices. 85 percent of our energy costs in Germany are fixed for this year – that is a sizable portion. For the coming year, the figure is 75 percent. So, we built in a price cap for ourselves,” he explained. Supply chain interruptions, too, were hardly felt by Deutsche Telekom. “We have long-term supply contracts in place. We are able to provide what our customers need.” Deutsche Telekom had been working for many years to become more independent from individual suppliers, he said. “We always buy from multiple suppliers, never just one. Because, particularly now, we are seeing how important independence is for stability.”

More and more, the business combination of T-Mobile US and Sprint was proving to be a big success. Synergies were higher than first expected. “Originally, we said we expected the takeover to unlock annual cost synergies of 6 billion dollars by the end. We have now raised this to 7.5 billion dollars.”

Höttges also addressed Russia’s war of aggression against Ukraine: “Global solidarity is encouraging. But solidarity alone is not enough. Actions are what count.” He spoke about the Group’s actions, such as making calls and text messages free of charge, as well as the around 650,000 SIM cards already handed out to refugees in Germany, Poland, Hungary, Romania, and Slovakia.

Tim Höttges summed up the situation: “Never in my lifetime has there been so much uncertainty. What is Deutsche Telekom’s role in this world? The most important thing: The T does not waver. We are the provider to the Western world. With strong mainstays on both sides of the Atlantic. The United States and Europe.”

Using a model, Höttges outlined the particular challenges involved in supplying trains on the stage at the shareholders’ meeting. This past year, Deutsche Telekom announced plans for comprehensive mobile coverage of the railway network by 2026. Both the service and quality are to be significantly improved for passengers in close collaboration with Deutsche Bahn. Deutsche Telekom will supply the trains with signal, which Deutsche Bahn will then pass on to its passengers using repeaters in the carriages or window panes, which allow mobile communication signals to pass through.

Major routes used by all ICE trains and the main IC trains are to be supplied with data rates of at least 200 Mbit/s by the end of 2024. By the end of 2025, data rates of at least 200 Mbit/s will also be available on heavily-traveled routes used by more than 2,000 passengers each day. All other routes are to be supplied with data rates of at least 100 Mbit/s by the end of 2026.

The dividend for the 2021 financial year proposed to the shareholders’ meeting is 0.64 euros per share. This is 6.7 percent higher than the 0.60 euros per share paid out one year ago.

Professor Ulrich Lehner chaired his last shareholders’ meeting for Deutsche Telekom as Chairman of the Supervisory Board. Lehner has headed the committee since 2008 and is now leaving for reasons of age. Höttges expressed thanks to him, saying: “You have been a good and insightful advisor to both the Board of Management and to me personally throughout. During our time with you as Chairman of the Supervisory Board, Deutsche Telekom has paid out some 41 billion euros in dividends. You always appealed to reason, but along the way you won the hearts of Deutsche Telekom’s employees.”