Deutsche Telekom AG (DT) Thursday said it took a huge write-down on its struggling U.K. operations as it swung to a first-quarter net loss.

Deutsche Telekom said its net loss in the quarter ended March 31 was EUR1.12 billion, after a net profit of EUR924 million a year earlier. Deutsche Telekom's bottom line was hurt by the EUR1.8 billion impairment charge on the goodwill of its T-Mobile operations in the U.K. Deutsche Telekom wrote down almost all of the EUR2.1 billion goodwill on its U.K. mobile operations.

Deutsche Telekom said April 21 that its 2009 operating profit would fall short of expectations on weak mobile operations in the U.S., the U.K. and Poland, in particular.

Chief Executive Rene Obermann said the U.K. market would benefit from a consolidation but declined to comment if Deutsche Telekom plans to sell its U.K. operations or merge them.

"The fact that we appointed a new management says something," Obermann said. Deutsche Telekom Chief Financial Officer Timotheus Hoettges said the equity value of T-Mobile U.K. is GBP3.3 billion.

Also Thursday, the Bonn-based company said it had appointed Richard Moat, the former boss of France Telecom SA's (FTE) Orange Romania operations, as managing director after naming Srini Gopalan as new U.K. chief marketing officer last month.

The company said Thursday it expects 2009 earnings before interest, tax, depreciation and amortization, or Ebitda, adjusted for exceptional items to be 2%-4% below 2008's EUR19.5 billion level, but added that Hellenic Telecommunications Organization SA (OTE), consolidated from Feb. 1, would contribute an additional EUR2 billion to its 2009 adjusted Ebitda. Free cash flow including OTE is set to reach around EUR7 billion, to which OTE is expected to contribute EUR600 million.

Deutsche Telekom confirmed that, including OTE, its first-quarter sales were up 6.2% on year to EUR15.9 billion, while earnings before interest, taxes, deprecation and amortization, adjusted for special items, rose 2.7% to EUR4.81 billion.

Deutsche Telekom was the first European integrated operator to lower its guidance due to adverse economic conditions, sending it shares lower at the time.

Landesbank Baden-Wuerttemberg analysts said the results were in line with the bank's view. The analysts rate the share a buy with a EUR10.50 target.

As most results were already provided with April's profit warning, the share-price reaction was limited. At 1400 GMT, the shares were down 0.4% at EUR8.27 in a flat overall German market.

In the U.S., T-Mobile's key growth driver in the past, revenue growth slowed and operating profit was down due to slower top-line growth and higher costs.

T-Mobile's net additions in the first quarter, defined as new customers minus churn, were 68.4% down on year.

In Germany, T-Mobile lost 118,000 customers, partly because the company terminated relation with inactive prepaid customers, while in the U.K. T-Mobile lost 111,000 customers in the January to March quarter.

Company Web site: www.telekom.de

-By Archibald Preuschat, Dow Jones Newswires, +49 211 138 7218, archibald.preuschat@dowjones.com