On March 3, 2005, Standard&Poor's Ratings Services raised its long-term corporate credit rating on Deutsche Telekom AG (DT), Germany's dominant telecoms service provider, to 'A-' from 'BBB+'. At the same time, the 'A-2' short-term corporate credit rating was affirmed. The outlook is stable. The action follows DT's rapid debt reduction over 2004 and sustained operating performance. Although the pace of debt reduction should come to a drastic halt in 2005, Standard&Poor's believes that DT has sufficiently improved its credit ratios, delivered suitably strong cash flow generation, and accumulated enough financial flexibility to be rated at this new level. Over 2004, DT reduced on-balance-sheet net debt (under German GAAP) to €35.2 billion ($46.6 billion), from €46.6 billion
