FORM 6-K
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934

Report on Form 6-K dated May 10, 2007

Magyar Telekom Plc.

(Translation of registrant’s name into English)

Budapest, 1013, Krisztina krt. 55, Hungary

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F x  Form 40-F.o

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o   No x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-                

 

	Contacts:	Szabolcs Czenthe, Magyar Telekom IR
		+36-1-458-0437
		Krisztina Förhécz, Magyar Telekom IR
		+36-1-457-6029
		Rita Walfisch, Magyar Telekom IR
		+36-1-457-6036
		investor.relations@telekom.hu

 

Q1 2007 results: solid underlying performance boosted by growing system integration & IT contribution

Budapest – May 10, 2007 – Magyar Telekom (Reuters: NYSE: MTA.N, BSE: MTEL.BU and Bloomberg: NYSE: MTA US, BSE: MTELEKOM HB), the leading Hungarian telecommunications service provider, today reported its consolidated financial results for the first three months of 2007, in accordance with International Financial Reporting Standards (IFRS). Starting from this 1Q07 flash report, Magyar Telekom will change its previously applied segment disclosure as a result of the change in the management structure of Group. Reported segments are consistent with information used by management for internal reporting and monitoring purposes. The segments are based on the business lines (T-Com, T-Mobile, T-Systems and Headquarter and shared services), which include both Hungarian and foreign activities. In addition, the Company’s secondary format for reporting segment information is geographical segments. The T-Com segment includes the fixed line operations in Hungary, Macedonia and Montenegro, as well as the alternative and wholesale operations in Romania, Bulgaria and Ukraine. The T-Mobile segment consists of the mobile operations in Hungary, Macedonia and Montenegro; Pro-M’s TETRA services are also consolidated here. T-Systems segment includes the corporate services in Hungary. The Headquarters and Shared services segment performs strategic and cross-divisional management functions for the Magyar Telekom Group, as well as real estate, marketing, security, procurement, human resources and accounting services, mainly for internal services within the Group. The sum of the financial results of the four segments presented below does not equal to the group financial results because of intersegment eliminations.

Highlights:

·                  Revenues grew by 6.1% from HUF 151.9 bn to HUF 161.1 bn (EUR 638.4 m) in Q1 2007 over the same period last year. The higher mobile, internet and SI/IT revenues compensated for the lower fixed line outgoing traffic revenues. The consolidation of KFKI, T-Systems Hungary and Dataplex contributed HUF 5.6 bn to Group revenues in Q1 2007.

·                  EBITDA decreased by 1.7% to HUF 63.0 bn, with an EBITDA margin of 39.1%. Group EBITDA excluding investigation-related costs (HUF 0.9 bn) and headcount reduction-related severance payments and accruals (HUF 4.0 bn) was HUF 67.9 bn with an EBITDA margin of 42.1%.

·                  Gross additions to tangible and intangible assets were HUF 9.4 bn, of which HUF 4.8 bn related to the T-Com segment, HUF 4.0 bn to T-Mobile (within this, HUF 1.0 bn was spent on mobile broadband investment) and HUF 0.5 bn to T-Systems.

·                  Profit attributable to equity holders of the company (net income) decreased by 16.1%, from HUF 18.9 bn (EUR 74.5 m) to HUF 15.9 bn (EUR 63.0 m), driven by higher income taxes.

·                  Net cash from operating activities grew strongly from HUF 43.6 bn to HUF 57.3 bn as the lower EBITDA and higher tax paid was offset by lower interest paid and a decrease in working capital requirements (driven mainly by a change in trade payables). Net cash utilized in investing activities fell

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from HUF 28.8 bn to HUF 25.0 bn, mainly driven by the Orbitel acquisition in Q1 2006. Net cash from financing activities significantly increased, reflecting the dividend paid to shareholders in January 2007 for 2005 financials.

·                  Net debt increased to HUF 283.2 bn, reflecting the increase in loans for financing acquisitions and dividend payment for 2005 financials paid in January 2007. The net debt ratio (net debt to net debt plus total equity) was 31.7% at end-March 2007.

Christopher Mattheisen, Chairman and CEO commented: “The key drivers of the solid Group-level top line growth in the first quarter were the consolidation impact of our recently acquired companies in the Hungarian IT & system integration sector and revenues related to the TETRA service. EBITDA slightly decreased due to the increased costs driven by the investigation- and headcount reduction-related expenses. For the first time, our segmental results are presented using our new reporting structure, which offers better visibility of our businesses and is consistent with internal reporting and monitoring. In the T-Com segment, our focus remains on customer retention and broadband expansion. In the Hungarian market, we have doubled the speed of the ADSL packages since the beginning of the year and introduced naked ADSL in March to further boost broadband penetration. As a result, the broadband customer number and internet revenues continued to show strong growth. In the T-Mobile segment, despite the high penetration and intense competition, we were able to maintain our clear market leadership in Hungary. Despite the negative impact of the cut in mobile termination fees on our revenues, mobile revenues increased thanks to the higher traffic and increasing importance of mobile broadband services. The revenue contribution of our international mobile subsidiaries also grew. The strong growth of T-Systems segment revenues reflects the consolidation of the new subsidiaries, KFKI and T-Systems Hungary as well as the impact of new outsourcing agreements.”

T-Com

Revenues before elimination fell by 2.3% to HUF 75.3 bn in Q1 2007 over the same period in 2006 and EBITDA margin decreased to 40.6%.

·                  Hungarian fixed line revenues declined by 2.4%, mainly due to mobile substitution and traffic loss to alternative and cable competitors. Internet revenues grew by 22.8% thanks to the significant increase in the number of ADSL and cable broadband customers. The total number of broadband connections exceeded 628,000 at end-March 2007, although strong mobile substitution and strong competition from cable operators resulted in a decline in the total number of fixed lines (down 4.2% at end-March 2007 compared to a year ago). EBITDA was down by 3.0% to HUF 24.9 bn and EBITDA margin was slightly up to 40.9%.

·                  In Macedonia, fixed line revenues decreased by 3.7% to HUF 10.2 bn, reflecting lower voice traffic due to strong mobile substitution and the emerging fixed line competition. This decrease was partly offset by increasing internet-related revenues. EBITDA decreased by 0.9% and EBITDA margin was up to 50.5% in the Q1 2007.

·                  In Montenegro, fixed line revenues increased by 3.2% to HUF 4.4 bn in the first quarter of 2007, as increasing wholesale and broadband revenues successfully offset the eroding retail voice traffic. EBITDA decreased significantly due to provisions created for employees leaving the company and related pending legal cases. As a result, the EBITDA margin decreased to 12.9%. Excluding the above provisions, EBITDA margin was broadly flat with 34%.

2

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T-Mobile

Revenues before elimination grew by 7.6% to HUF 80.8 bn; EBITDA margin was 42.7%.

·                  T-Mobile Hungary showed a revenue increase of 4.1% thanks to the healthy growth in the customer base and growing focus on value added services, despite a decrease in wholesale voice revenues, driven by the mobile termination fee cut in February 2007. Although the increase in value added service revenues and usage continues, ARPU showed a 3.3% decrease due to the declining tariffs and the cut in the termination rates. Average acquisition cost per new customer increased by 5%, reflecting the higher subsidies for postpaid customers and 3G/HSDPA enabled devices. As a result, the customer mix improved further reaching a postpaid ratio of 35.7% at the end of the first quarter. EBITDA was HUF 27.9 bn with an EBITDA margin of 41.8%.

·                  T-Mobile Macedonia reported 12.6% revenue growth in a growing market characterised by strong tariff competition. Although the tariff level is continuously decreasing, the positive shift in customer mix and improving usage resulted in a 4.5% increase in ARPU. EBITDA margin reached a strong 54.4%.

·                  Montenegrin mobile revenues increased by 23.1% in Q1 2007, as both customer base and usage significantly increased, helped by the increasing mobile substitution. Market penetration increased to 135% at end of March, mainly reflecting the extended availability of SIM cards since October 2006. EBITDA margin was 28.0% in Q1 2007 due to severance payment related expenses.

·                  Pro-M, the TETRA service company, reported HUF 1.7 bn mobile service revenues and HUF 0.6 bn EBITDA in Q1 2007.

T-Systems

Revenues before elimination increased by 36.4% driven by the consolidation effect of the new subsidiaries. KFKI and T-Systems Hungary contributed HUF 5.3 bn revenues and HUF 0.7 bn EBITDA in the first quarter of 2007. The positive trend in revenues was supported by new outsourcing agreements and the governmental electronic tax filing project. Excluding the new subsidiaries, revenues decreased by 3.8%, driven by the continuous pressure on voice tariffs and increasing mobile substitution. The segment’s EBITDA was flat and EBITDA margin was 23.1% in Q1 2007.

Headquarters and Shared services

Revenues before eliminations were down by 8.5% driven by lower marketing and real estate service revenues. EBITDA decreased by 21.3% to HUF -6.2 bn due to higher employee related expenses driven by severance expenses.

As previously disclosed, in the course of conducting their audit of our 2005 financial statements, PricewaterhouseCoopers Könyvvizsgáló és Gazdasági Tanácsadó Kft. (“PwC”) identified two contracts the nature and business purposes of which were not readily apparent. In February 2006, our Audit Committee initiated an independent investigation into this matter. In the course of the investigation, two further contracts entered into by Magyar Telekom Plc. were potentially raising concerns. To date, the independent investigators have been unable to find sufficient evidence to show that any of the four contracts under investigation resulted in the provision of services to us or to our subsidiaries under those contracts of a value commensurate with the payments we made under those contracts. The independent investigators have been unable to determine definitively the purpose of the contracts, and it is possible that the purpose may have been improper. The independent investigators further identified several contracts at our Macedonian subsidiary that could warrant further review. In February 2007, our Board of Directors determined that those contracts should be reviewed and expanded the scope of the independent investigation to cover these additional contracts and related transactions. We have approved and are currently implementing certain remedial measures designed to enhance our internal controls to ensure compliance with Hungarian and U.S. legal requirements and NYSE listing requirements.

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As previously reported, the investigation delayed the finalization of our 2005 financial statements, and as a result we and some of our subsidiaries have failed and may fail to meet certain deadlines prescribed by U.S., Hungarian and other applicable laws and regulations for preparing and filing audited annual results and holding annual general meetings. We have to date been fined HUF 13 million as a consequence of these delays. We have notified the Hungarian Financial Supervisory Authority, the U.S. Securities and Exchange Commission and the U.S. Department of Justice of the investigation, are in regular contact with these authorities regarding the investigation and are responding to inquiries raised by these authorities.

About Magyar Telekom

Magyar Telekom is the principal provider of telecom services in Hungary. Magyar Telekom provides a broad range of services including traditional fixed line and mobile telephony, data transmission, value-added, IT and system integration services. Magyar Telekom owns the majority of the shares of MakTel, the sole fixed line operator and its subsidiary T-Mobile Macedonia, the leading mobile operator in Macedonia. Magyar Telekom has a majority stake in Crnogorski Telekom. This Group provides fixed, mobile and Internet services in Montenegro. Key shareholders of Magyar Telekom as of March 31, 2007 include MagyarCom Holding GmbH (59.21%), owned by Deutsche Telekom AG. The remainder, 40.79% is publicly traded.

This investor news contains forward-looking statements. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore should not have undue reliance placed upon them. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events.

Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Such factors are described in, among other things, our Annual Report on Form 20-F for the year ended December 31, 2005 filed with the U.S. Securities and Exchange Commission.

For detailed information on Magyar Telekom’s Q1 2007 results please visit our website:

(www.magyartelekom.hu/english/investorrelations/main.vm) or the website of the Budapest Stock Exchange (www.bse.hu).

4

MAGYAR TELEKOM

Consolidated

Balance Sheets - IFRS

  (HUF million)

		Mar 31, 2006		Mar 31, 2007		% change
		(Unaudited)		(Unaudited)
ASSETS
Current assets
Cash and cash equivalents		56,517		83,352		47.5	%
Other financial assets		1,850		8,680		369.2	%
Trade receivables		71,713		88,082		22.8	%
Inventories		10,342		10,332		(0.1	)%
Current recoverable income taxes		1,122		7,622		579.3	%
Other assets		20,981		26,786		27.7	%
Total current assets		162,525		224,854		38.4	%
Non-current assets
Intangible assets		320,889		330,223		2.9	%
Property, plant and equipment		579,042		534,857		(7.6	)%
Investments in associates		4,837		4,122		(14.8	)%
Other financial assets		5,872		24,885		323.8	%
Deferred tax assets		15,112		19,781		30.9	%
Total non-current assets		925,752		913,868		(1.3	)%
Total assets		1,088,277		1,138,722		4.6	%
LIABILITIES AND EQUITY
Current liabilities
Loans from related parties		20,000		54,000		170.0	%
Other financial liabilities		56,567		41,191		(27.2	)%
Accrued interest		5,034		6,232		23.8	%
Trade payables		51,717		62,099		20.1	%
Other liabilities		45,134		49,086		8.8	%
Provisions		4,718		10,113		114.3	%
Income tax liabilities		2,061		1,399		(32.1	)%
Total current liabilities		185,231		224,120		21.0	%
Non-current liabilities
Loans from related parties		239,432		215,432		(10.0	)%
Other financial liabilities		20,230		55,883		176.2	%
Other liabilities		5,556		8,527		53.5	%
Provisions		3,330		3,422		2.8	%
Deferred tax liabilities		3,613		19,918		451.3	%
Total non-current liabilities		272,161		303,182		11.4	%
Total liabilities		457,392		527,302		15.3	%
EQUITY
Issued capital		104,277		104,277		0.0	%
Additional paid in capital		27,380		27,380		0.0	%
Treasury shares		(1,926	)	(1,504	)	(21.9	)%
Retained earnings		419,062		414,818		(1.0	)%
Cumulative translation adjustment		5,454		(3,645	)	n.m.
Shareholders’ equity		554,247		541,326		(2.3	)%
Minority interests		76,638		70,094		(8.5	)%
Total equity		630,885		611,420		(3.1	)%
Total liabilities and equity		1,088,277		1,138,722		4.6	%

 

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MAGYAR TELEKOM

Consolidated

Income Statements - IFRS

  (HUF million)

		3 months ended Mar 31,				%
		2006		2007		change
		(Unaudited)		(Unaudited)
Revenues
Subscriptions		23,206		23,018		(0.8	)%
Domestic outgoing traffic revenues		18,359		13,957		(24.0	)%
International outgoing traffic revenues		2,514		2,614		4.0	%
Value added and other services		2,148		1,957		(8.9	)%
Voice - retail revenues		46,227		41,546		(10.1	)%
Domestic incoming traffic revenues		2,665		2,097		(21.3	)%
International incoming traffic revenues		4,345		4,627		6.5	%
Voice - wholesale revenues		7,010		6,724		(4.1	)%
Internet revenues		11,454		13,877		21.2	%
Data		6,724		6,798		1.1	%
Multimedia		4,314		4,552		5.5	%
Equipment sales		1,225		1,159		(5.4	)%
Other revenues		2,223		1,907		(14.2	)%
Fixed line revenues		79,177		76,563		(3.3	)%
Voice - retail		44,499		45,791		2.9	%
Voice - wholesale		9,506		10,985		15.6	%
Visitor		1,020		1,185		16.2	%
Non-voice		9,701		10,643		9.7	%
Equipment sales and activation		5,005		4,795		(4.2	)%
Other revenues		428		2,275		431.5	%
Mobile revenues		70,159		75,674		7.9	%
System Integration/Information Technology revenues		2,534		8,888		250.7	%
Total revenues		151,870		161,125		6.1	%
Voice, data and Internet related payments		(21,485	)	(20,369	)	(5.2	)%
Cost of equipment sales		(8,095	)	(8,185	)	1.1	%
Payments to agents and other subcontractors		(6,284	)	(11,051	)	75.9	%
Total revenue-related payments		(35,864	)	(39,605	)	10.4	%
Employee-related expenses		(21,500	)	(26,636	)	23.9	%
Depreciation and amortization		(29,216	)	(28,349	)	(3.0	)%
Other operating expenses - net		(30,444	)	(31,892	)	4.8	%
Total operating expenses		(117,024	)	(126,482	)	8.1	%
Operating profit		34,846		34,643		(0.6	)%
Net financial expenses		(7,736	)	(7,161	)	(7.4	)%
Share of associates' profits		(26	)	60		n.m.
Profit before income tax		27,084		27,542		1.7	%
Income tax		(5,299	)	(8,879	)	67.6	%
Profit for the period		21,785		18,663		(14.3	)%
Attributable to:
Equity holders of the Company (Net income)		18,948		15,899		(16.1	)%
Minority interests		2,837		2,764		(2.6	)%
		21,785		18,663		(14.3	)%

 

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MAGYAR TELEKOM

Consolidated

Cashflow Statements - IFRS

  (HUF million)

		3 months ended Mar 31,				%
		2006		2007		change
		(Unaudited)		(Unaudited)
Cashflows from operating activities
Profit for the year		21,785		18,663		(14.3	)%
Depreciation and amortization		29,216		28,349		(3.0	)%
Income tax expense		5,299		8,879		67.6	%
Net finance expense		7,736		7,161		(7.4	)%
Share of associate profit		26		(60	)	n.m.
Change in working capital		(6,868	)	4,986		n.m.
Tax paid		(4,336	)	(6,646	)	53.3	%
Dividend received		157		0		(100.0	)%
Interest paid		(8,403	)	(7,271	)	(13.5	)%
Interest received		675		1,399		107.3	%
Other cashflows from operations		(1,703	)	1,857		n.m.
Net cash generated from operating activities		43,584		57,317		31.5	%
Cashflows from investing activities
Additions to tangible and intangible assets		(19,137	)	(9,384	)	(51.0	)%
Change in payables relating to capital expenditures		(8,524	)	(14,969	)	75.6	%
Purchase of subsidiaries and business units		(2,052	)	(62	)	(97.0	)%
Cash acquired through business combinations		22		485		2,104.5	%
Proceeds from / (Payments for) other financial assets - net		59		(2,225	)	n.m.
Proceeds from disposal of non current assets		807		1,157		43.4	%
Net cash used in investing activities		(28,825	)	(24,998	)	(13.3	)%
Cashflows from financing activities
Dividends paid to shareholders and minority interest		(16	)	(76,031	)	n.m.
Net proceeds of loans and other borrowings		(8,515	)	50,441		n.m.
Other		(18	)	0		(100.0	)%
Net cash used in financing activities		(8,549	)	(25,590	)	199.3	%
Exchange gains / (losses) on cash		4,247		(1,217	)	(128.7	)%
Change in cash and cash equivalents		10,457		5,512		(47.3	)%
Cash and cash equivalents, beginning of period		46,060		77,840		69.0	%
Cash and cash equivalents, end of period		56,517		83,352		47.5	%
Change in cash and cash equivalents		10,457		5,512		(47.3	)%

 

7

Summary of key operating statistics

GROUP		Mar 31, 2006		Mar 31, 2007		% change
EBITDA margin		42.2	%	39.1	%	n.a.
Operating margin		22.9	%	21.5	%	n.a.
Net income margin		12.5	%	9.9	%	n.a.
CAPEX to Sales		12.6	%	5.8	%	n.a.
ROA		7.0	%	5.6	%	n.a.
Net debt		279,712		283,154		1.2	%
Net debt / net debt + total capital		30.7	%	31.7	%	n.a.
Number of employees (closing full equivalent)		12,014		12,365		2.9	%

 

T-COM SEGMENT		Mar 31, 2006		Mar 31, 2007		% change
Hungarian fixed line operations
Fixed line penetration		35.3	%	33.8	%	n.a.
Number of closing lines (1)
Residential		1,961,374		1,878,406		(4.2	)%
Business		177,341		169,571		(4.4	)%
Payphone		21,931		20,370		(7.1	)%
ISDN channels		327,880		312,752		(4.6	)%
Total lines		2,488,526		2,381,099		(4.3	)%

 

Traffic in minutes (thousands) (1)
Local		762,119		733,979		(3.7	)%
Long distance		252,374		241,639		(4.3	)%
Fixed to mobile		119,298		93,369		(21.7	)%
Domestic outgoing traffic		1,133,791		1,068,987		(5.7	)%
International outgoing traffic		16,968		14,362		(15.4	)%
Internet		328,518		153,135		(53.4	)%
Total outgoing traffic		1,479,277		1,236,484		(16.4	)%
Data products
ADSL connections		370,362		551,129		48.8	%
Number of Internet subscribers
Dial-up		73,938		23,359		(68.4	)%
Leased line		735		663		(9.8	)%
DSL		240,967		362,004		50.2	%
W-LAN		1,467		1,048		(28.6	)%
CATV		30,971		67,381		117.6	%
Total Internet subscribers		348,078		454,455		30.6	%
Market share in the dial-up market (estimated)		42	%	40	%	n.a.
Cable television customers		406,682		413,436		1.7	%
Total broadband Internet access		403,535		628,281		55.7	%
Macedonian fixed line operations
Macedonian fixed line penetration		25.3	%	23.4	%	n.a.
Number of closing lines
Residential		454,750		423,619		(6.8	)%
Business		48,000		42,853		(10.7	)%
Payphone		2,264		2,072		(8.5	)%
ISDN channels		41,032		42,868		4.5	%
Total Macedonian lines		546,046		511,412		(6.3	)%

 

Macedonian traffic in minutes (thousands)
Local		314,095		291,594		(7.2	)%
Long distance		44,859		42,521		(5.2	)%
Fixed to mobile		30,171		26,185		(13.2	)%
Domestic outgoing traffic		389,125		360,300		(7.4	)%
International outgoing traffic		7,021		6,144		(12.5	)%
Internet		54,980		34,128		(37.9	)%
Total outgoing Macedonian traffic		451,126		400,572		(11.2	)%
Data products (Macedonia)
ADSL connections		9,558		18,279		91.2	%
Number of Internet subscribers
Dial-up		90,122		118,190		31.1	%
Leased line		136		143		5.1	%
DSL		9,558		18,279		91.2	%
Total Internet subscribers		99,816		136,612		36.9	%
Market share in the dial-up market (estimated)		92	%	93	%	n.a.

 

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Montenegrin fixed line operations

Montenegrin fixed line penetration		31.2	%	30.5	%	n.a.
Number of closing lines
PSTN lines		174,227		168,426		(3.3	)%
ISDN channels		19,486		21,196		8.8	%
Total Montenegrin lines		193,713		189,622		(2.1	)%

 

Montenegrin traffic in minutes (thousands)
Local		81,435		77,509		(4.8	)%
Long distance		31,153		16,935		(45.6	)%
Fixed to mobile		8,902		7,174		(19.4	)%
Domestic outgoing traffic		121,490		101,618		(16.4	)%
International outgoing traffic		2,892		16,979		487.1	%
Internet		106,462		92,833		(12.8	)%
Total outgoing Montenegrin traffic		230,844		211,430		(8.4	)%

 

Data products (Montenegro)
ADSL connections		2,003		8,382		318.5	%
Number of Internet subscribers
Dial-up		27,605		24,904		(9.8	)%
Leased line		114		120		5.3	%
DSL		2,003		8,382		318.5	%
Total Internet subscribers		29,722		33,406		12.4	%
Market share in the dial-up market (estimated)		98	%	98	%	n.a.

 

T-MOBILE SEGMENT		Mar 31, 2006		Mar 31, 2007		% change
Hungarian mobile operations
Mobile penetration		93.3	%	99.9	%	n.a.
Market share of T-Mobile Hungary		44.9	%	44.5	%	n.a.
Number of customers (RPC)		4,222,206		4,477,965		6.1	%
Postpaid share in the RPC base		32.1	%	35.7	%	n.a.
MOU		129		140		8.5	%
ARPU		4,597		4,444		(3.3	)%
Postpaid		9,962		8,678		(12.9	)%
Prepaid		2,092		2,137		2.2	%
Overall churn rate		15.8	%	15.1	%	n.a.
Postpaid		10.4	%	10.2	%	n.a.
Prepaid		18.3	%	17.8	%	n.a.
Enhanced services within ARPU		646		666		3.1	%
Average acquisition cost (SAC) per customer		6,176		6,512		5.4	%
Macedonian mobile operations
Macedonian mobile penetration		62.0	%	70.0	%	n.a.
Market share of T-Mobile Macedonia		68.3	%	65.5	%	n.a.
Number of customers (RPC)		877,228		954,618		8.8	%
Postpaid share in the RPC base		16.8	%	20.5	%	n.a.
MOU		61		77		26.2	%
ARPU		2,754		2,878		4.5	%
Montenegrin mobile operations
Montenegrin mobile penetration		79.1	%	134.5	%	n.a.
Market share of T-Mobile Crna Gora		41.4	%	41.1	%	n.a.
Number of customers (RPC) (2)		203,037		342,339		68.6	%
Postpaid share in the RPC base		17.9	%	14.8	%	n.a.
MOU		124		99		(20.2	)%
ARPU		3,766		2,978		(20.9	)%

 

T-SYSTEMS SEGMENT		Mar 31, 2006		Mar 31, 2007		% change
Number of closing lines (1)
Business		68,034		62,990		(7.4	)%
Managed leased lines (Flex-Com connections)		9,854		8,682		(11.9	)%
ISDN channels		168,000		166,342		(1.0	)%
Total lines		245,888		238,014		(3.2	)%

 

Traffic in minutes (thousands) (1)
Local		120,250		89,915		(25.2	)%
Long distance		49,529		38,745		(21.8	)%
Fixed to mobile		35,789		24,733		(30.9	)%
Domestic outgoing traffic		205,568		153,393		(25.4	)%
International outgoing traffic		8,503		7,620		(10.4	)%
Internet		16,764		8,180		(51.2	)%
Total outgoing traffic		230,835		169,193		(26.7	)%

(1)   Magyar Telekom Plc. + Emitel (100% owned by Magyar Telekom Plc.)

(2)   In October 2006, prepaid voucher lifecycle was extended from 3 to 11 months in Montenegro, resulting in increase in the number of prepaid RPC.

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