Communications Monopoly Reports Profit Plunge
FRANKFURT, Germany (AP) _ Deutsche Telekom, the German communications monopoly, reported Tuesday a 96 percent drop in its profit for the first half, due mostly to the costs of laying off workers.
The company plans to lay off 60,000 employees in the next four years in preparation for going private.
The company said it earned 129 million marks, or $89 million, in the first half, down from 3.5 billion marks a year earlier.
Group sales excluding value added tax were up a slight 1.5 percent to 29.7 billion marks, or $20 billion, for the first six months.
The company’s chief financial officer, Joachim Kroeske, said he expects full-year revenues of more than 60 billion marks, or $41 billion.
Deutsche Telekom also gave a net profit figure that was based, for the first time, on U.S. accounting principals.
According to that figure, Deutsche Telekom’s net profit for the first six months of the year was 500 million marks, or $345 million. But no comparison data for 1995 were given.