Outlook for Operating Free Cash Flow Reiterated, Shift from Constant Currency to Actual Currency Basis

Outlook shifted from constant to actual currency basis

Operating free cash flow of EUR 1.1 billion reiterated

DPS minimum of 75 cents  confirmed

Including the impact from declining currencies in Telekom Austria Group’s foreign operations, the management expects full-year figures for 2009 on actual currency basis to reach a level of EUR 4.8 billion in revenues and EUR 1.8 billion in EBITDA compared to previously expected revenues slightly weaker than EUR 5.1 billion and an EBITDA of about EUR 1.9 billion on constant currency basis. In order to offset the impact of a decline in EBITDA on the free cash flow, capital expenditures might decrease to a level of up to EUR 700 million. Therefore, the Telekom Austria Group remains committed to an operating free cash flow (EBITDA less capital expenditures) for 2009 of EUR 1.1 billion on actual currency basis and a distribution of 65% of net income in form of dividends at a minimum floor of 75 cents per share.

The main reasons for the weaker outlook include foreign exchange losses, lower roaming revenues, declining prices and the impact from weaker economies in Telekom Austria Group’s main foreign operations. The management expects the difficult market environment to prevail also in 2010.

 
Outlook 09
as of Nov. 12		Outlook 09
as of May 13
and August 19		Outlook 09 
as of Jan. 29 
 and Feb. 25
Telekom Austria GroupActual currency basisConstant currency basis*Constant currency basis*
Revenues~ EUR 4.8 bnSlightly weaker than originally expected~ EUR 5.1 bn
EBITDA~ EUR 1.8 bn~ EUR 1.9 bn~ EUR 1.9 bn
Capital expenditures ~ EUR 0.7 bn~ EUR 0.8 bn~ EUR 0.8 bn
Operating Free Cash Flow~ EUR 1.1 bn~ EUR 1.1 bn~ EUR 1.1 bn
Dividend65% of net income,
DPS of 75 cent minimum		65% of net income,
DPS of 75 cent minimum		65% of net income,
DPS of 75 cent minimum

* as announced on the Capital Market Day in January 2009