Germany's Deutsche Telekom booked a bottom-line net profit of 557 million euros ($739 million) in 2011, the company announced in a statement on Thursday. This marked a drop of 67.1 percent from a year earlier.

The Bonn-based telecommunications giant said the fourth quarter of last year was particularly disappointing, with a net loss of 1.34 billion euros.

"This was due to a number of special factors, including writedowns in the United States and writedowns on goodwill and property, plant and equipment in Europe, and Greece in particular," the group said in a statement.

Deutsche Telekom said writedowns in the US and Greece totaled 3.3 billion euros, more than wiping out the 2.3 billion euro cash payment from AT&T in compensation for the termination of an agreement to buy Telekom's US business T-Mobile USA.

The company's operating profit fell by 4 percent to 18.68 billion euros, while revenue dropped by 6 percent to 58.65 billion euros in 2011.

Landline business a trouble spot

Deutsche Telekom saw the continued erosion of its fixed-line business, losing another 295,000 subscribers last year. But it also secured over 1 million new mobile telephony clients.

In Germany alone, the company logged a 4.4-percent decline in business last year, with revenues totaling 24 billion euros. Deutsche Telekom's outlook for this year remains bleak.

"In 2011, the company operated in a challenging environment in every respect – a situation that is not going to change in the current year," said CEO Rene Obermann. But he tried to put a positive spin on the tasks ahead.

"Our capacity for innovation, cost discipline and readiness for change are vital assets as we prepare to master these challenges in 2012," Obermann maintained.

hg/jrb (AFP, AP)