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Deutsche Telekom AG - Interim Group report - January 1 to March 31, 2011

27Interim Group management report Development of operations. Q1 2011 millions of € Q1 2010 millions of € Change millions of € Change % FY 2010 millions of € Total revenuea 5,991 6,189 (198) (3.2) 25,145 Consumers 3,118 3,235 (117) (3.6) 13,109 Business Customers 1,414 1,377 37 2.7 5,661 Wholesale 1,066 1,141 (75) (6.6) 4,553 Digital Services 177 199 (22) (11.1) 866 Value-Added Services 107 130 (23) (17.7) 498 Other 109 107 2 1.9 458 Profit from operations (EBIT) 1,248 1,171 77 6.6 4,916 EBIT margin % 20.8 18.9 19.6 Depreciation, amortization and impairment losses (1,067) (1,014) (53) (5.2) (4,193) EBITDA 2,315 2,185 130 5.9 9,109 Special factors affecting EBITDA (69) (114) 45 39.5 (509) EBITDA (adjusted for special factors) 2,384 2,299 85 3.7 9,618 EBITDA margin (adjusted for special factors) % 39.7 37.1 38.3 Cash capex (815) (651) (164) (25.2) (4,765) Average number of employees 76,598 80,729 (4,131) (5.1) 79,364 a As part of the One Company initiative, we have aligned our business structure even more closely with the needs of customers. From the first quarter of 2011, we report revenue for the consolidated customer segments within the Germany operating segment. The prior-year figures have been adjusted for better comparability. Total revenue. Total revenue amounted to EUR 6.0 billion in the first quarter of 2011. The 3.2-percent decline year-on-year was mainly attributable to the downward trend in voice telephony, both in mobile and fixed-network business. Adjusted for the price effect of the reduction in termination rates from December 2010, the first-time consolidation of ClickandBuy and the discontinuation of trade with mobile prepaid cards of other carriers, which was stopped as part of the measures for value-driven growth, we reduced the year-on-year decline in our revenue to 2.0 percent (revenue decline in the first quarter of 2010: 2.2 per- cent). Management’s intensified focus on EBITDA margins and improving revenue trends in the Germany operating segment thus yielded some initial successes. This trend was partially offset by growing demand for complete packages with mobile data rates, broadband TV revenue and the positive trend in smartphone revenue. Revenue from Consumers was down by 3.6 percent to EUR 3.1 billion. The decline was mainly attributable to continuing losses of fixed-network lines and a price effect from the decrease in mobile termination rates. This decrease was partly offset by growth in mobile data and broadband TV revenue. The high demand for mobile handsets, in particular smartphones, increased revenue from terminal equipment. In the Business Customers area, total revenue increased in the first quarter of 2011 by 2.7 percent to EUR 1.4 billion, despite the reduction in termination rates. Revenue growth from mobile communications and broadband Internet more than offset the slight decline in revenue from voice telephony in the tradi- tional fixed-network business.