EANS-Adhoc: freenet AG / freenet AG increases earnings, lowers debt in Q1/2010

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ad-hoc disclosure pursuant to section 15 of the WpHG transmitted by euro
adhoc with the aim of a Europe-wide distribution. The issuer is solely
responsible for the content of this announcement.
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3-month report

11.05.2010

freenet AG increases earnings, lowers debt in Q1/2010

- Revenue totals 806.1 million euros
- Recurring EBITDA reaches 78.2 million euros
- Group result of 20.8 million euros
- 91.4 million euros in cash flow from operating activities
- Net debt reduced by 89.1 million euros to 700.7 million euros

Büdelsdorf, 11 May 2010 - freenet AG was able to improve the
profitability of its Mobile Communications segment in the first
quarter of the year, thanks to the restructuring progress made to
date. First-quarter recurring EBITDA (earnings before interest, taxes
and depreciation/amortisation) in the Mobile Communications segment -
adjusted for one-off items - increased by 6.3 percent year-on-year
from 71.6 million euros to 76.1 million euros, even though revenue in
this segment is declining at freenet as well as across the market.
Group third-party revenue for Q1/2010 came to 806.1 million euros.
The Mobile Communications segment contributed 782.8 million euros to
total segment revenue, or almost 97 percent. Revenue from the Portal,
Narrowband and B2B Services businesses is combined in the segment
report under Other revenue; it was down by 40.1 percent vs. Q1/2009,
from 43.9 million euros to 26.3 million euros. Group revenue for the
first quarter 2009 amounted to 888.0 million euros. At 20.6 percent,
the gross profit margin for Q1/2010 remained on par year-on-year.
Group EBITDA came to 70.8 million euros, compared with 75.4 million
euros in Q1/2009. This includes restructuring-related one-off items
in the amount of 7.4 million euros, of which 6.5 million euros were
incurred in Mobile Communications. In Q1/2009 the one-off items were
incurred only in the Mobile Communications segment and burdened
EBITDA by 4.7 million euros. Recurring EBITDA for Q1/2010 - adjusted
for one-off items - came to 78.2 million euros, vs. 80.1 million
euros in Q1/2009. The Group generated pre-tax earnings (EBT) of 9.9
million euros in the first quarter of 2010, compared with a loss of
-6.4 million euros in Q1/2009.

The Group result from continued operations for Q1/2010 surged by
112.0 percent to 15.0 million euros, compared with 7.1 million euros
in Q1/2009. The Group result from discontinued operations improved -
mainly thanks to profits from the sale of the DSL business - from
-6.5 million euros in Q1/2009 to 5.7 million euros in Q1/2010. On
balance, this yields a first-quarter Group result of 20.8 million
euros - up by 20.2 million euros year-on-year. In Q1/2010, cash flow
from operating activities came to 91.4 million euros, and net debt
was reduced by 89.1 million euros to 700.7 million euros.

|Important KPI's of freenet Group
|Accounting method: IAS/IFRS
| | | | |
|Overview Group |Q1/2010 |Q1/2009 |Q4/2009**|
| | |adjusted*| |
| | | | |
|Result in EUR million | | | |
|Third-party revenue |806.1 |888.0 |941.1 |
|Gross profit |165.9 |186.0 |208.8 |
|EBITDA |70.8 |75.4 |100.6 |
|EBITDA recurring |78.2 |80.1 |120.9 |
|EBIT |23.3 |23.5 |48.1 |
|EBT |9.9 |-6.4 |27.5 |
|Group result from continued operations |15.0 |7.1 |11.9 |
|Group result from discontinued operations |5.7 |-6.5 |232.6 |
|Group result |20.8 |0.6 |244.4 |
| | | | |
|Overview Mobile Communications segment |Q1/2010 |Q1/2009 |Q4/2009**|
| | | | |
|Customer development in million | | | |
|Mobile Communications customers |17.15 |18.53 |17.58 |
|Thereof contract customers (excluding no-frills |6.84 |7.43 |6.98 |
|customers) | | | |
|Thereof prepaid customers |8.50 |9.92 |9.15 |
|Thereof no-frills customers*** |1.81 |1.18 |1.45 |
| | | | |
|Result in EUR million | | | |
|Revenue |782.8 |847.3 |907.2 |
|Gross profit |151.2 |169.4 |191.6 |
|EBITDA |69.6 |66.9 |97.9 |
|EBITDA-adjusted / recurring |76.1 |71.6 |113.0 |
|EBIT |25.0 |19.5 |50.2 |
|EBIT-adjusted / recurring |31.6 |24.2 |65.3 |
| | | | |
|Monthly average revenue per user (ARPU) in EUR | | | |
|Contract customer (excluding no-frills) |22.8 |23.9 |24.1 |
|Prepaid customer |2.9 |2.8 |3.1 |
|No-frills customer*** |4.5 |5.3 |5.3 |

* The comparison figures have been adjusted retrospectively due to IFRS 5
(presentation of the STRATO Group as a discontinued operation). Furthermore
retrospective reclassifications were made within the income statement items
relating to continued operations because the contract between freenet AG and 1&1
Internet AG regarding the sale of the DSL business has now been signed. In
addition, another retrospective adjustment was made with regard to including the
DSL distribution unit in the discontinued operation "DSL Business".
** The data can only be compared to a limited degree due to the seasonality in
the mobile communications business.
*** Starting in Q1/2010 including prepaid.

end of announcement euro adhoc
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ots Originaltext: freenet AG
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freenet AG

Investor Relations

Tel.: +49 (0)40 51306-778

E-Mail: ir@freenet.ag

Branche: Telecommunications
ISIN: DE000A0Z2ZZ5
WKN: A0Z2ZZ
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