Telekom Austria Group: Results for the First Quarter 2004 VIENNA, Austria, May 25 /PRNewswire-FirstCall/ -- Telekom Austria AG (VSE: TKA; NYSE: TKA) today announced its results for the first quarter 2004 ending March 31, 2003. During the first quarter 2004 total group revenues increased by 2.4% to EUR 989.4 million. After applying the change in accounting for third party value added services, which was implemented on October 1, 2003 retroactively on 1Q 03, the increase in group revenues amounts to 4.1%. On this basis, the decline in wireline revenues decreased to 1.7% (EUR 535.2 million in 1Q 04), with figures being supported by higher revenues from monthly rentals and rising ADSL figures. In the wireless business, the 9.9% increase in revenues to EUR 514.1 million was primarily driven by the Austrian and Croatian operations. Adjusted group EBITDA rose by 2.7% to EUR 416.7 million during 1Q 04, with a 1.0% decline in the wireline segment to EUR 213.4 million and a 10.1% increase in the wireless segment to EUR 209.0 million. The wireless segment includes a reversal of a provision for universal service obligations in the amount of EUR 5.6 million which was eliminated upon consolidation. During 1Q 04 stock options, which were granted to employees of Telekom Austria at the time of the IPO, became exercisable resulting in compensation expenses to the amount of EUR 9.4 million, including related payroll taxes and social contribution expenses. Group operating income benefited from a decline in impairment charges, and rose by 11.6 % to EUR 136.0 million. Results for 1Q 03 included a charge for the cumulative effect of the adoption of SFAS 143 "Accounting for Asset Retirement Obligation". The final calculation at year-end resulted in an upward revision of the charge. The amount has been reallocated to 1Q 03 lowering net profit by EUR 5.6 million compared to the figure reported last year. As a result, consolidated net income of Telekom Austria rose by 88.5% to EUR 70.7 million. Earnings per share increased from EUR 0.08 to EUR 0.14. Capital expenditures for tangible and intangible assets fell by 5.6% to EUR 71.0 million during 1Q 04. Net debt continued to decline to EUR 2,536.7 million at the end of March 2004, compared to EUR 2,637.3 million at the end of December 2003. Also today, mobilkom austria announced a major development with its partner, Vodafone. Simultaneously with its mobile subsidiaries, VIPnet in Croatia and Si.Mobil in Slovenia, on June 3, 2004, mobilkom austria will launch Vodafone live!, one of the most successful mobile lifestyle services of the world. For further information please refer to mobilkom austria's press release at http://www.mobikomaustria.com/presse All financial figures are based on US GAAP. Further information please find on the website http://www.telekom.at/ About Telekom Austria Telekom Austria is Austria's leading provider of telecommunications services. It was listed on the Vienna and New York stock exchanges in November 2000. The Group has two main business areas: the wireline segment encompasses fixed line telephony, data and Internet, and the wireless segment covers mobile communications. Telekom Austria has international operations in the Czech Republic, Croatia, Slovenia and Liechtenstein. http://www.telekom.at/ DATASOURCE: Telekom Austria CONTACT: For further information please contact: Martin Bredl Head of Public Relations Phone: +43-(0)59059-1-11001 E-Mail: Hans Fruhmann Head of Investor Relations Phone: +43-(0)59059-1-20917 E-Mail:

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