Deutsche Telekom guides for growth in 2021 after Q4 beat

Deutsche Telekom reported forecast-beating fourth-quarter results on Friday as its merged US unit T-Mobile continued to drive growth, and issued guidance for profit and cash flow to grow this year.

The Germany-headquartered transatlantic telecoms group expects its measure of core profit to reach 37 billion euros ($45 billion) this year and for free cash flow to hit 8 billion euros.

For 2020 as a whole, Deutsche Telekom earned revenue of more than 100 billion euros for the first time as T-Mobile's $26 billion takeover of Sprint, which closed on April 1, shifted its centre of gravity as a group to the United States.

"We made history in 2020. We added a substantial and important chapter to Deutsche Telekom's story," CEO Tim Hoettges said in a statement.

After stripping out the effects of the US merger and other one-off effects, organic revenue rose by 5.4% in the quarter while adjusted earnings before interest, taxation, depreciation and amortization after leases (EBITDA AL) grew by 9%.

On a reported basis, fourth quarter revenue rose 29.3% to 27.6 billion euros, ahead of expectations in a company poll of analysts of 27.2 billion euros.

Adjusted EBITDA AL - management's preferred measure of underlying profitability - gained 48.5% on a reported basis to 9 billion euros, also just above consensus. ($1 = 0.8228 euros)