T-Mobile Polska's Results in the First Quarter of 2023

In the first quarter of 2023, T‑Mobile Polska achieved significant growth in total revenue and mobile service revenue. Despite a decrease in interconnect revenue, total revenue amounted to PLN 1.72 billion and increased by 10.3% YoY. During the same period, mobile service revenue reached PLN 1.01 billion, representing a 1.1% YoY increase. However, a significant increase in costs due to high inflation (especially energy costs which increased by 170%) reduced the EBITDA AL result by -2.9% YoY to PLN 439 million. The sale of devices had a clear impact on the company's revenue growth.

 

 

T-Mobile incessantly invests in network quality to furnish clients with unsurpassed propositions and services. In the first trimester, it pioneered a hybrid power system for base stations in Poland. Such endeavors enable the operator to not merely achieve climate neutrality goals, but also translate to the loftiest satisfaction scores amongst infrastructure operators.

As of early 2023 Deutsche Telekom Group, of which we are a part, was recognized in the Brand Finance Global 500 report as the most valuable brand in Europe. I have no doubt that T‑Mobile Poland's activities also contributed to this achievement. But it is not the awards that we put first, but our customers. It is for them that we take care of the highest quality of the network, services and their satisfaction every day. And it is with them in mind that we introduce more and more innovations, so that it is T‑Mobile customers who are the first to benefit from reliable solutions that improve their technological experience. This quarter, we were the first operator in Poland to implement a hybrid power system for base stations, but also free trials of T‑Mobile unlimited Internet through e-SIM without switching operators. In doing so, I can assure you that this is not our last word in building the satisfaction of current and future T‑Mobile customers– stated Andreas Maierhofer, CEO of T‑Mobile Polska.

By the end of the first quarter, T‑Mobile's customer base increased by 708k year-on-year, reaching a level of 12.5 million. The churn rate in the contract segment remained low at 0.7%. According to the Office of Electronic Communications' number portability report, T‑Mobile achieved the second-best result among infrastructure operators during this period, registering a positive MNP balance of 13,900 new users.

The company witnessed growth in the number of customers across all segments: contract, prepaid, private, and business. Notably, the increase in customers with broadband internet access deserves attention, which currently stands at 182,000 users (an increase of 91,000 YoY). The number of individual clients opting for convergent packages from T‑Mobile also experiences a steady rise.

 

In the first quarter of 2023, we continued to observe the economy tackling with double-digit inflation levels and high energy prices, which caused T‑Mobile's energy costs to soar by 170%. Despite these challenging external conditions, we achieved more than 10% increase in total revenues and expanded our customer base to over 12.5 million. We attribute this positive result to several factors. Primarily, it was the significant interest in our broadband internet services and a very evident surge in device sales. I have no doubt that our solid performance is also a consequence of our focus on the network quality leadership, highest customer satisfaction, consistent implementation of market strategy, accompanied with attention to the company's financial stability– stated Juraj Andras, T‑Mobile Board Member for Finance.

Customers increasingly choose convergent offers

Since introducing linear television to its portfolio in 2022, T‑Mobile has observed steady growth in interest for the convergent Magenta Dom offering, as well as its individual components, which is reflected in the persistent positive balance of number portability. In the first quarter of this year, the operator worked diligently to make joining T‑Mobile and using its products, including convergent packages, even easier. This approach resulted in the implementation of the first-ever free 3-month trial of T‑Mobile's unlimited internet via e-SIM in Poland, without changing the operator or signing a contract. Being aware of the quality of its services, T‑Mobile also allows customers to test any service for 30 days. The operator is also focused on developing the prepaid segment – in April of this year, as the first in Poland, it introduced an offer with unlimited calls to Ukraine within the Heyah prepaid plan, and a T-Mobile prepaid offer featuring the largest market package of 4,800 GB extra for a year.

Continued growth in the business segment

The first quarter of 2023 for T‑Mobile in the business segment was marked by stable growth. Compared to the same period in 2022, the operator recorded a +28% increase in number portability in the small business area, as well as double-digit growth in sales of top L/VIP offers and fiber-optic contracts. This was the result of consistent communication and sales activities for the MagentaBiznes offer, as well as the implementation of the MagentaBiznes VIP offer aimed at offices. Importantly, in the first three months of 2023, MagentaBiznes customers significantly more often chose top-shelf smartphones.

Meanwhile, in the segment of the largest companies, T‑Mobile focused on customer needs and creating innovative solutions together with them. This resulted in the implementation of three new services. The first, "Secure Internet," fully secures T‑Mobile's internet connection without any intervention in the customer's infrastructure. "Internet Business Pro" addresses the need for rapid changes in local networks, offering cyber protection mechanisms and the ability to build guest networks for customers, which were previously available exclusively to corporations. The third service is "Workspace as a Service," through which the customer receives appropriately configured equipment for employees and IT support from T‑Mobile. Importantly, the "as a Service" sales model means that the customer pays a monthly fee instead of incurring investment costs, without burdening their credit capacity.

The beginning of 2023 also marked T‑Mobile's establishment of two significant partnerships. The operator became a partner of the postgraduate studies "Cybersecurity Management" at the Leon Kozminski Academy in Warsaw, which will help educate new experts in this field. Meanwhile, the collaboration with Siemens will enable offering customers even more possibilities in the area of industrial networks (campus networks).

Highest network quality

In the first quarter of 2023, T‑Mobile continues network investments to provide customers with the best quality of services. As the customer base and data transmission demand have increased, data traffic in T‑Mobile's network rose by 3% compared to the fourth quarter of 2022 and by 30% year-on-year. T‑Mobile addresses these trends by constantly modernizing its network and preparing it for increased loads. In the first quarter, the operator modernized approximately 300 base stations and continued investments in expanding the 5G network. The 5G signal was launched in the 2100 MHz band at over 480 base stations, increasing their number to more than 5,620, and the country's territorial coverage is at 47% of the population. In 2022, T‑Mobile began optimizing its network to support the development of 4G/LTE and 5G while phasing out old technology like 3G. In the first quarter, the process gained full speed and the 3G network was turned off in most of Poland. not only Network modernization contributes to offering customers the highest quality services using the best technology but also to reducing energy consumption in the operator's network.

At the same time, the operator consistently implements the ESG strategy, aiming to achieve environmental neutrality throughout the supply chain by 2040, also by applying innovative solutions using renewable energy to power base stations. In addition to installing photovoltaic panels on base stations and other telecommunications facilities, the operator introduced a hybrid installation powering a base station with solar and wind energy. The base station in Brudzowice is the first project of this type in Poland. T‑Mobile plans to introduce similar systems in other locations.

Steadily towards climate neutrality

The first quarter of 2023 in terms of responsible business actions involves the consistent implementation of the ESG strategy, hence the operator's further eco-friendly initiatives. The company decided to reduce the plastic cards on which SIM cards are delivered. This solution will save about 8 tons of plastic materials annually. In its actions, T‑Mobile is also moving towards climate neutrality. As a sign of its full commitment to supporting climate neutrality actions, the operator not only turned off the lighting in its headquarters during this year's Earth Hour but also summarized the results of its recent actions. Thanks to the analysis of the most energy-consuming instances in the main headquarters building and the introduction of several changes, 12% of energy and 33% of heat from the municipal network were saved compared to the same period in the previous year. Additionally, changes introduced to the vehicle fleet allowed saving 900 tons of CO2 and reducing emissions by 35%.

In the last quarter, the company also implemented projects in the field of digital inclusion. On the occasion of Grandparents' Day, the company reminded about the "Network of Generations" campaign and a free technology course. In February, the operator's new solution, "8 for Seniors," premiered. By contacting the Customer Service Office and choosing number 8, customers can access new facilities prepared for the elderly.