Shareholders approve dividend, Board actions

Deutsche Telekom's 2004 shareholders' meeting in Hanover overwhelmingly voted to approve the actions and resolutions of management. Shareholders also praised the Group's strategy of focusing on three growth areas and on customer needs, which CEO Kai-Uwe Ricke had explained in his speech to the 4,600 attending the meeting.

After about ten hours of debate, the meeting overwhelmingly approved the actions of the Board of Management and the Supervisory Board and passed all their motions. Among them: a resolution to pay shareholders a dividend of 0.62 euros per share.

During the general debate, shareholder representatives praised management for its new strategy of focusing on the three growth areas of Broadband/Fixed-Line, Business Customers and Mobile Communications as well as on customers' needs. "With this new structure we are responding to fact that our markets will change greatly in the coming years," Ricke said. The planned merger of Deutsche Telekom and T-Online is one of the key elements of this strategy. While shareholders approve of that strategy, several speakers said they understood that many T-Online shareholders were unhappy about the terms of the public tender and the exchange ratio offered to T-Online shareholders and called for "more fairness" towards T-Online shareholders.

The benefits of triple play
"The broadband fixed-line network and the Internet are growing closer and closer together," Ricke explained. Market and customer needs "can only be addressed through complete integration of the company". Only the integration of the broadband fixed-line network and the Internet makes possible a wide range of new products and services, i.e. "innovative offers with many customer benefits from one source". In this context, Ricke repeatedly referred to the so-called triple play of voice communication, PC-based Internet communication and innovative Internet services for the consumer market using the TV as a platform: "This makes it possible for us to attract not just people's communications budgets, but also their entertainment budgets."

The pursuit of excellence
Shareholders also showed great interest in the company's three-year Excellence Program and its goal of "excellence before the customer" as the focus of all action. "Excellence means that we want to be better than our competitors in those areas our customers consider important," Ricke said, vowing that the Excellence Program would be carried out with the same dedication as the debt reduction program has been in the past three years. For 2005, the Board of Management is aiming for an adjusted EBITDA in the €20.7 to €21 billion range with both CAPEX and free cash flow between €7.5 and €8 billion.

"Clear improvements" in quality
The pursuit of excellence is the continuation of the Agenda 2004, which Ricke described as "an important first step that has been concluded with good results" for its six initiatives for broadband, business customers, personnel, quality, innovation and efficiency. The CEO singled out the quality drive as "an important foundation for clear improvements" in the way DT is being perceived. He highlighted the recently announced customer promises as "quality indicators our customers can rely on."

Demonstrating social responsibility
Ricke also highlighted the success of the personnel initiative, which seeks to strike the balance between good business sense and social responsibility: "We want more than just business success for us and our shareholders. We are also committed to acting responsibly towards our employees and towards society." This can be seen in a number of actions, ranging from the Deutsche Telekom Foundation and the T@School program to support for telephone hotlines for troubled youths and parents.