Germany’s largest ISP, T-Online, posted an 87% increase in sales for the nine months to September 30 but saw profitability collapse into the red.
While sales at T-Online rose to 542.6 million euros, costs related to the launch of the Deutsche Telekom subsidiary's 24-hour flat rate service were blamed for a pendulum swing into the red and a loss of 14.4m euros before interest, taxes, dividends and amortization.
The loss would have been even more severe had it not been for a one-off payment of 39.2 million euros arising from the sale of T-Online's stake in online brokerage Comdirect.
The ISP’s world-wide subscriber total increased 83% to seven million. On average, each T-Online customers now uses its services for 501 minutes a month, compared with 441 minutes three months earlier. T-Online attributes this largely to the introduction of its flat rate service which not only aims to win and retain new customers but also to increase their time online.
Although the figures were on a par with most analysts' expectations, the Frankfurt stock market showed its disappointment and T-Online shares dipped 2.2%, to 23.11 euros ($19.89).
News source: Wall Street Journal