T-Online results better than expected

The estimated loss for Europe’s largest ISP amounted to Euros 125m before interest, taxation, depreciation and amortisation.

Group revenues for the business year ending 31 December 2000 were Euros 797.2m – up 86.1% on the previous year. According to T-Online, the newly acquired subsidiaries, which brought in Euros 55.2m, contributed to the increase. The company boasted 7.9 million subscribers by the end of 2000 compared to 4.7 million last year.

T-Online blamed start-up losses incurred by its foreign subsidiaries for the loss. The Neuer Markt-listed company also introduced flat-rate internet subscription fees, but was still forced to pay rates by the minute for network access.

Analysts from Merrill Lynch said the company’s fourth quarter revenues – Euros 254m – and advertising and e-commerce revenues – Euros 48.9m – were ahead of forecasts.

However, the analysts downgraded their intermediate term recommendation to ‘neutral’ because of the company’s valuation, ‘concerns over the quality of portal revenues and the still heavy reliance on access revenues’. Nonetheless, Merrill Lynch is maintaining its long-term ‘buy’ recommendation on the stock.

Last year proved challenging for T-Online, with the resignation of its entire executive board in May over disagreements with parent company Deutsche Telekom and its failed acquisition attempt of Freeserve in June.


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