T-Online Posts Q1 Loss

04 May 2001

Preliminary Q1 financial results from Deutsche Telekom-owned ISP T-Online reveal an EBITDA (earnings before interest, taxes, depreciation and amortization) loss of E66.4 million.

The loss is down slightly from the fourth quarter’s E66.9m shortfall, but represents a dramatic turnaround from its EBITDA gain of E5.8m in Q1 2000. It also comes despite 61% year-on-year growth in group revenue to E280.2m.

There has been mounting pressure from analysts for T-Online to switch the basis of its revenues from web access – seen as an outdated business model – to e-commerce. However, access remained by far the biggest money-spinner, with revenues from this source rising from E153.7m last year to E241.8m.

Although e-commerce revenues almost doubled year-on-year from E16m to E31.3m, they actually fell in comparison with Q4, when they stood at E49m. This quarterly fall reflects Deutsche Telekom’s cutbacks in advertising for its high-speed lines.

The ISP announced that it expected EBITDA losses to narrow in coming months, due to more stringent cost controls and the scrapping of its narrowband flat rate. Full Q1 results are due out on May 23.

News Source: Handelsblatt (Germany)