Provisions for pensions and other liabilities on the balance sheet of Deutsche Telekom decreased by €1bn year-on-year in the first half of 2025 to €2.2bn, according to company’s H1 financial statement.
Liabilities on the balance sheets of German large firms are declining mainly as a result of increasing discount rates in the first half of this year.
This, combined with positive capital market developments, led to a new peak in funding ratios for the pension schemes of the largest firms in Germany.
Deutsche Telekom’s defined benefit (DB) plans gained €900m because of positive market performance of invested pension assets, and increasing discount rate, according to the H1 statement.
Pension assets on Deutsche Telekom’s balance sheet amounted to €7.2bn last year, up from €6.9bn in 2023, according to the company’s 2024 financial statement.
The company’s funding ratio improved year-on-year in 2024 to 70% from 63% in 2023, according to the DAX pension funds study published by WTW in March.
Last year, Deutsche Telekom boosted investments in equities by €400m, from €4.45bn in 2023 to €4.85bn in 2024. The share of investment in equities includes a €2.1bn holding in its British counterpart BT, according to the 2024 financial statement.
Allocations of pension assets to debt instruments fell year-on-year, from close to €2bn in 2023 to €1.77bn in 2024, the statement added.
Deutsche Telekom invests €123m of pension assets in real estate, €43m in investment funds, €102m in cash and cash equivalents, and €259m in other types of investments, the statement shows.
DB plans are funded through Pensionsfonds and a Contractual Trust Agreement (CTA). Some companies of the Deutsche Telekom group offer their employees defined contribution plans.
In Switzerland, DC plans are funded through the Pensionskasse of the subsidiary T-Systems. In the US, Deutsche Telekom has frozen the Sprint Retirement Pension Plan and the Supplemental Executive Retirement Plan to replace them with 401(k) plans.
No comments yet