DEFINED TERMS

The term "Report" refers to this Quarterly Report on Form 6-K for the six-month period ended June 30, 2003.

Deutsche Telekom AG is a private stock corporation organized under the laws of the Federal Republic of Germany. As used in this Report, unless the context otherwise requires, the term "Deutsche Telekom" refers to Deutsche Telekom AG and the terms "we," "us", "our" and "Group" refer to Deutsche Telekom and, as applicable, Deutsche Telekom and its direct and indirect subsidiaries as a group. Our registered office is at Friedrich-Ebert-Allee 140, 53113 Bonn, Germany, telephone number +49-228-181-0. Our agent for service in the United States is Deutsche Telekom, Inc., 280 Park Avenue, 26th Floor, New York, NY, 10017.

FORWARD-LOOKING STATEMENTS

This Report contains forward-looking statements that reflect the current views of our management with respect to future events. Forward-looking statements generally are identified by the words "expects," "anticipates," "believes," "intends," "estimates," "aims," "plans," "will," "will continue," "seeks" and similar expressions. Forward-looking statements are based on current plans, estimates and projections, and therefore you should not place too much reliance on them. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update any forward-looking statement in light of new information or future events, although we intend to continue to meet our ongoing disclosure obligations under the U.S. securities laws (such as our obligations to file annual reports on Form 20-F and periodic and other reports on Form 6-K) and under other applicable laws. Forward-looking statements involve inherent risks and uncertainties, most of which are difficult to predict and are generally beyond our control. We caution you that a number of important factors could cause actual results or outcomes to differ materially from those expressed in, or implied by, the forward-looking statements. These factors include, among other factors: the development of demand for our telecommunications services, particularly for new, higher value service offerings; competitive forces, including pricing pressures, technological changes and alternative routing developments; regulatory actions and the outcome of disputes in which the company is involved or may become involved; the pace and cost of the rollout of new services, such as UMTS, which may be affected by the ability of suppliers to deliver equipment and other circumstances beyond our control; public concerns over health risks putatively associated with wireless frequency transmissions; risks associated with integrating our acquisitions; the development of asset values in Germany and elsewhere, the progress of our debt reduction program, including its degree of success in achieving desired levels of liquidity improvement and proceeds from disposals; the development of our cost control initiatives, including in the area of personnel reduction; risks and uncertainties relating to benefits anticipated from our international expansion, particularly in the United States; the progress of our domestic and international investments, joint ventures and alliances; our ability to gain or retain market share in the face of competition; our ability to secure the licenses needed to offer new services; the effects of price reduction measures and our customer acquisition and retention initiatives; the availability, term and deployment of capital, particularly in view of our debt refinancing needs, actions of the rating agencies and the impact of regulatory and competitive developments on our capital outlays; and changes in currency exchange rates and interest rates. If these or other risks and uncertainties (including those described in "Forward-Looking Statements," "Item 3. Key Information — Risk Factors" and "Item 5. Operating and Financial Review and Prospects — Factors Affecting Our Business" contained in our most recent Annual Report on Form 20-F/A for the year ended December 31, 2002 filed with the U.S. Securities and Exchange Commission) materialize, or if the assumptions underlying any of these statements prove incorrect, our actual results may be materially different from those expressed or implied by such statements.

2

EXCHANGE RATES

Unless otherwise indicated, all amounts in this document are expressed in euros. As used in this document, "euro" or "EUR" means the single unified currency that was introduced in the Federal Republic of Germany (referred to as the "Federal Republic") and ten other participating member states of the European Union on January 1, 1999. "U.S. dollar" or "USD" means the lawful currency of the United States of America. As used in this document, the term "noon buying rate" refers to the rate of exchange for euro, expressed in U.S. dollars per euro, as announced by the Federal Reserve Bank of New York for customs purposes as the rate in The City of New York for cable transfers in foreign currencies. Unless otherwise stated, conversions of euro into U.S. dollars have been made at the rate of EUR 1.1502 to USD 1.00, which was the noon buying rate on June 30, 2003.

Amounts appearing in this report that were translated into euros from other currencies were translated in accordance with the principles described in the consolidated financial statements contained in our Annual Report on Form 20-F/A under "Consolidation principles — Foreign currency translation."

3

DEUTSCHE TELEKOM AT A GLANCE

				For the six months ended June 30,																For the year December 31, 2002
				2003				2002				Change				% Change
				millions of € (except where indicated)
Total net revenues (total revenues excluding inter-segment revenues)					27,211				25,754				1,457				5.7				53,689
Domestic					17,136				17,201				(65	)			(0.4	)			35,288
International					10,075				8,553				1,522				17.8				18,401
Results from ordinary business activities (1)					1,092				(3,347	)			4,439				n.m.				(27,150	)
Financial income (expense), net					(1,945	)			(2,930	)			985				33.6				(6,022	)
Depreciation and amortization					(6,481	)			(7,874	)			1,393				17.7				(36,880	)
Property, plant and equipment					(4,133	)			(4,750	)			617				13.0				(9,525	)
Intangible assets					(2,348	)			(3,124	)			776				24.8				(27,355	)
Other taxes					(96	)			(102	)			6				5.9				(364	)
Net income (loss)					1,109				(3,891	)			5,000				n.m.				(24,587	)
Earnings (loss) per share /ADS (EUR) (2)					0.26				(0.93	)			1.19				n.m.				(5.86	)
Investments in property, plant and equipment and intangible assets (3)					(2,105	)			(3,497	)			1,392				39.8				(7,928	)
Net cash provided by operating activities					6,260				6,645				(385	)			(5.8	)			12,463
Equity ratio (%)(4)					28.6				36.3												28.1
Debt (in accordance with consolidated balance sheet)					61,248				66,910				(5,662	)			(8.5	)			63,044
Number of employees at balance sheet date
Deutsche Telekom Group					250,533				254,806				(4,273	)			(1.7	)			255,969
Salaried employees (excl. civil servants)					200,554				202,048				(1,494	)			(0.7	)			205,193
Civil servants					49,979				52,758				(2,779	)			(5.3	)			50,776
Telephone lines (incl. ISDN channels) (5)					58.1				57.9				0.2				0.3				58.1
Mobile communications subscribers (majority shareholdings) (6)					61.4				52.9				8.5				16.1				58.6

n.m. – not meaningful

(1)

Prior year figures adjusted for other taxes. Until the end of 2002, we classified our consolidated statement of operations using the total-cost method. In this report, we are publishing our consolidated statement of operations in accordance with the cost-of-sales method. Besides the allocation of operational expenses to individual areas of operations, this also involves including other taxes in the operating results, or results from ordinary business activities. The prior-year comparatives have been restated accordingly to conform to the cost-of-sales method.

(2)	Earnings (loss) per share for each period are calculated by dividing net income (loss) by the weighted average number of outstanding shares. The share/American Depository Share (ADS) ratio is 1:1.

(3)	Excluding goodwill.

(4)	The ratio equals total shareholders' equity divided by total assets.

(5)	Number of telephone channels (including those provided by T-Com as well as T-Systems and those used within the group) as of the balance sheet date, includes the first time Maktel, a MATAV subsidiary. The figures for 2002 have been adjusted accordingly. All amounts are in millions.

(6)	The number of subscribers of the consolidated subsidiaries included within our T-Mobile division plus HT Mobiline Telekomunikacije and Westel, at the balance sheet date. All amounts are in millions.

4

DEUTSCHE TELEKOM AG

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
AS OF JUNE 30, 2003 AND DECEMBER 31, 2002 AND
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2003 AND 2002
AND THE YEAR ENDED DECEMBER 31, 2002
(Unaudited)

5

DEUTSCHE TELEKOM AG

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

								For the three months ended June 30,								For the six months ended June 30,								For the year ended December 31,
								2003				2002				2003				2002				2002
								(millions of €, except per share data)
				Note
Net revenue									13,593				12,984				27,211				25,754				53,689
Cost of sales									(7,741	)			(8,362	)			(15,310	)			(16,050	)			(44,477	)
Gross profit									5,852				4,622				11,901				9,704				9,212
Selling costs									(3,168	)			(3,084	)			(6,555	)			(6,363	)			(13,264	)
General and administrative costs									(1,290	)			(1,415	)			(2,625	)			(2,673	)			(6,062	)
Other operating income					(3	)			1,118				927				2,629				1,780				3,901
Other operating expense					(4	)			(1,061	)			(1,539	)			(2,313	)			(2,865	)			(14,915	)
Operating results									1,451				(489	)			3,037				(417	)			(21,128	)
Financial income (expense), net					(5	)			(853	)			(1,182	)			(1,945	)			(2,930	)			(6,022	)
Results from ordinary business activities (1)									598				(1,671	)			1,092				(3,347	)			(27,150	)
Income taxes					(6	)			(266	)			(329	)			194				(388	)			2,847
Income (loss) after taxes									332				(2,000	)			1,286				(3,735	)			(24,303	)
Income applicable to minority shareholders									(76	)			(83	)			(177	)			(156	)			(284	)
Net income (loss)									256				(2,083	)			1,109				(3,891	)			(24,587	)
Earnings (loss) per share(2)/ADS(3) (German GAAP)									0.06				(0.50	)			0.26				(0.93	)			(5.86	)

(1)	Including other taxes in accordance with the classification of the statement of operations by the cost-of-sales-method.

(2)	Earnings (loss) per share (according to German GAAP) for each period are calculated by dividing net income (loss) by the weighted average number of outstanding shares.

(3)	One ADS (American Depository Share) corresponds in economic terms to one share of Deutsche Telekom AG common stock.

The accompanying notes are an integral part of these
unaudited condensed consolidated financial statements.

6

DEUTSCHE TELEKOM AG

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

								As of June 30, 2003				As of December 31, 2002
								(millions of €)
				Note
ASSETS
Noncurrent assets					(9	)
Intangible assets									48,894				53,402
Property, plant and equipment									48,822				53,955
Financial assets									3,509				4,169
									101,225				111,526
Current assets
Inventories, materials and supplies									1,348				1,556
Receivables									6,296				6,258
Other assets									3,533				3,392
Marketable securities									115				413
Liquid assets									8,526				1,905
									19,818				13,524
Prepaid expenses and deferred charges									1,294				771
TOTAL ASSETS									122,337				125,821
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' equity					(10	)
Capital stock									10,746				10,746
Additional paid-in capital									50,085				50,077
Retained earnings									248				248
Unappropriated net income (loss) carried forward from previous year									(24,564	)			23
Net income (loss)									1,109				(24,587	)
Cumulative translation adjustment account									(6,690	)			(5,079	)
Minority interest									4,016				3,988
									34,950				35,416
Accruals
Pensions and similar obligations									4,249				3,942
Other accruals									10,455				12,155
									14,704				16,097
Liabilities					(11	)
Debt									61,248				63,044
Other									10,641				10,541
									71,889				73,585
Deferred income									794				723
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES									122,337				125,821

The acompanying notes are an integral part of these
unaudited condensed consolidated financial statements.

7

DEUTSCHE TELEKOM AG

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited)

				Capital stock nominal value				Additional paid-in capital				Consolidated shareholders' equity generated				Cumulative translation adjustment account				Minority interest				Shareholders' equity in accordance with the consolidated balance sheet				Treasury stock				Consolidated shareholders' equity
				(millions of €)
Balance at Dec. 31, 2001					10,746				49,994				1,826				(1,572	)			5,307				66,301				(7	)			66,294
Changes in the composition of the group																					(2,116	)			(2,116	)							(2,116	)
Dividends for 2001													(1,539	)							(19	)			(1,558	)							(1,558	)
Proceeds from exercise of stock options									79																79								79
Net loss													(3,891	)							156				(3,735	)							(3,735	)
Foreign currency translation													(16	)			(3,757	)			2				(3,771	)							(3,771	)
Balance at June 30, 2002					10,746				50,073				(3,620	)			(5,329	)			3,330				55,200				(7	)			55,193
Balance at December 31, 2002					10,746				50,077				(24,316	)			(5,079	)			3,988				35,416				(7	)			35,409
Changes in the composition of the group																					(5	)			(5	)							(5	)
Dividends for 2002																					(79	)			(79	)							(79	)
Proceeds from exercise of stock options									8																8								8
Net income													1,109								177				1,286								1,286
Foreign currency translation																	(1,611	)			(65	)			(1,676	)							(1,676	)
Balance at June 30, 2003					10,746				50,085				(23,207	)			(6,690	)			4,016				34,950				(7	)			34,943

The accompanying notes are an integral part of these
unaudited condensed consolidated financial statements.

8

DEUTSCHE TELEKOM AG

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

				For the six months ended June 30,								For the year ended December 31,
				2003				2002				2002
				(millions of €)
Cash flows from operating activities
Net income (loss)					1,109				(3,891	)			(24,587	)
Income applicable to minority shareholders					177				156				284
Income (loss) after taxes					1,286				(3,735	)			(24,303	)
Depreciation and amortization					6,481				7,874				36,880
Income tax expense (benefit)					(194	)			388				(2,847	)
Net interest expense					1,930				2,083				4,048
Results from the disposal of noncurrent assets					(608	)			214				(428	)
Results from associated companies					22				154				430
Other noncash transactions					(451	)			960				1,144
Change in working capital (assets) (1)					(926	)			(413	)			184
Decrease in accruals					146				482				1,410
Change in working capital (liabilities) (2)					59				(327	)			101
Income taxes received (paid)					235				677				(15	)
Dividends received					41				44				63
Cash generated from operations					8,021				8,401				16,667
Net interest paid					(1,761	)			(1,756	)			(4,204	)
Net cash provided by operating activities					6,260				6,645				12,463
Cash flows from investing activities
Cash outflows from investments in
intangible assets					(287	)			(388	)			(841	)
property, plant and equipment					(2,007	)			(3,439	)			(6,784	)
financial assets					(221	)			(363	)			(568	)
consolidated companies					(26	)			(4,791	)			(6,405	)
Cash inflows from disposition of
intangible assets					11				2				14
property, plant and equipment					548				196				1,304
financial assets					1,050				770				1,130
shareholdings in consolidated companies and business units					1,502				0				697
Net change in short-term investments and marketable securities					(4,792	)			193				226
Other					0				428				1,187
Net cash used for investing activities					(4,222	)			(7,392	)			(10,040	)
Cash flows from financing activities
Net changes in short-term debt					(3,534	)			(3,765	)			(10,012	)
Issuance of medium and long-term debt					5,157				7,868				11,677
Repayments of medium and long-term debt					(2,048	)			(2,805	)			(3,472	)
Dividends paid					(54	)			(1,558	)			(1,582	)
Proceeds from exercise of stock options					8				0				1
Changes in minority interests					(7	)			(47	)			(47	)
Net cash used for financing activities					(478	)			(307	)			(3,435	)
Effect of foreign exchange rate changes on cash and cash equivalents					(18	)			(14	)			(14	)
Net increase (decrease) in cash and cash equivalents					1,542				(1,068	)			(1,026	)
Cash and cash equivalents, at beginning of the period					1,712				2,738				2,738
Cash and cash equivalents, at end of the period					3,254				1,670				1,712

(1)	Changes in receivables, other assets, inventories, materials and supplies and deferred expenses

(2)	Changes in other liabilities (which do not relate to financing activities) and deferred income

The accompanying notes are an integral part of these
unaudited condensed consolidated financial statements.

9

Note (1) Summary of presentation principles

The condensed consolidated financial statements (unaudited) of Deutsche Telekom as of June 30, 2003 and December 31, 2002 and for the three months and the six months ended June 30, 2003 and 2002 and the year ended December 31, 2002, have been prepared in accordance with the requirements of the German Commercial Code (Handelsgesetzbuch — HGB) and the German Stock Corporation Law (Aktiengesetz — AktG).

Until the end of 2002, we classified our condensed consolidated statement of operations using the total-cost method. Beginning with the first quarter of 2003, we published our condensed consolidated statement of operations using the cost-of-sales method, which is more common for international financial statements. Besides allocating operational expenses to functional areas, this also involves including other taxes in the operating results, or results from ordinary business activities. The prior-year comparative financial information has been revised to conform to the current year presentation.

These condensed consolidated financial statements are unaudited. In management's opinion, these unaudited condensed consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the consolidated results of operations, balance sheet and cash flows for each period presented. The consolidated results for interim periods are not necessarily indicative of results for the full year. These financial results should be read in conjunction with the Company's report on Form 20-F/A for the year ended December 31, 2002.

German GAAP differs in certain respects from generally accepted accounting principles in the United States (U.S. GAAP). Application of U.S. GAAP would have affected the balance sheets as of June 30, 2003 and December 31, 2002 and net income (loss) for the six months ended June 30, 2003 and 2002. A qualitative and quantitative discussion of the significant differences between German GAAP and U.S. GAAP appears in note (14) herein, and in more detail in Notes (40) through (43) to our consolidated financial statements contained in our Annual Report on Form 20F/A for the year ended December 31, 2002.

Note (2) Changes within the consolidated group

We acquired shareholdings in various companies during the second half of 2002, which were not included in the consolidated financial statements as of June 30, 2002. The most significant of these were T-Mobile Netherlands Holding B.V. (at T-Mobile), Detecon International GmbH (at T-Systems), and Interactive Media CCSP AG (at T-Online). In addition, shareholdings were sold in the first six months of 2003, which were included in the consolidated financial statements as of June 30, 2002. These were, at T-Com, the remaining cable business and, at T-Systems, predominantly T-Systems SIRIS S.A.S. and TeleCash Kommunikations-Service GmbH. The following table shows the effects of these acquisitions and disposals on the individual line items of the condensed consolidated statement of operations for the first six months of 2003. The other operating expenses figure shown below includes goodwill amortization and write-downs relating to these companies totaling EUR 47 million.

				T-Mobile				T-Online				T-Systems				T-Com				Total
				(millions of €)
Net revenue					389				2				(24	)			(195	)			172
Cost of sales					(275	)			(1	)			35				145				(96	)
Gross profit					114				1				11				(50	)			76
Selling costs					(159	)			(1	)			2				45				(113	)
General and administrative costs					(18	)			(5	)			(5	)			(16	)			(44	)
Other operating income					4				3				117				315				439
Other operating expenses					(58	)			0				(8	)			(67	)			(133	)
Financial income/ (expense), net					(15	)			(1	)			2				(4	)			(18	)
Results from ordinary business activities					(132	)			(3	)			119				223				207
Income taxes					0				0				0				(176	)			(176	)
Income (loss) after taxes					(132	)			(3	)			119				47				31
(Income) loss applicable to minority shareholders					0				0				0				0				0
Net income (loss)					(132	)			(3	)			119				47				31

10

Note (3) Other operating income

The components of other operating income for the six months ended June 30, 2003 and 2002 are as follows:

				For the six months ended June 30,
				2003				2002
				(millions of €)
Reversal of accruals					365				533
Income from the disposal of noncurrent assets (Including sales of investments)					1,078				265
Income from the reversal of valuation adjustments (including asset-backed securities)					353				261
Cost reimbursements					256				165
Foreign currency transaction gains					90				63
Insurance compensation					42				21
Refund of value-added-tax (§15a UstG)					27				34
Other income					418				438
Total					2,629				1,780

Note (4) Other operating expenses

The components of other operating expenses for the six months ended June 30, 2003 and 2002 are as follows:

				For the six months ended June 30,
				2003				2002
				(millions of €)
Amortization of goodwill					(1,270	)			(1,716	)
Foreign currency transaction losses					(136	)			(206	)
Losses on disposition of non-current assets					(107	)			(488	)
Other operating expenses					(800	)			(455	)
Total					(2,313	)			(2,865	)

Note (5) Financial income (expense), net

The components of financial expense, net for the three- and six-months ended June 30, 2003 and 2002 are as follows:

				For the three months ended June 30,								For the six months ended June 30,
				2003				2002				2003				2002
				(millions of €)
Net interest expense					(873	)			(981	)			(1,930	)			(2,083	)
Income (loss) related to associated and related companies					4				(4	)			1				(113	)
Write-downs on financial assets and marketable securities					16				(197	)			(16	)			(734	)
Financial income (expense), net					(853	)			(1,182	)			(1,945	)			(2,930	)

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Note (6) Income Taxes

Our domestic combined income tax rate for the first six months of 2003 was 40.5%, consisting of a corporate income tax of 25%, increased over one year by 1.5% to 26.5% to fund the reparations resulting from the 2002 floods in Eastern Germany, a trade earnings tax (at an average rate) and a solidarity surcharge levied at 5.5% on corporate income tax.

We have recognized a tax benefit in the first six months of 2003 as a result of the effect of the change of the legal form of T-Mobile from a stock corporation to a partnership, due to permanent differences between taxable income and pretax financial income and due to differences between domestic and foreign tax rates and regulations. These benefits were partially offset by the effects of tax losses for which deferred tax assets were not recorded, and goodwill amortization and capital losses that were not tax-deductible.

Note (7) Personnel

				For the three months ended June 30,								For the six months ended June 30,
				2003				2002				2003				2002
				(millions of €)
Personnel costs					(3,510	)			(3,293	)			(6,902	)			(6,498	)

Personnel costs increased by EUR 404 million, or 6.2 percent, in the first half of 2003 compared with the same period in 2002. This increase is mainly attributable to collectively agreed wage and salary increases and the effect of an adjusted discount rate applied to pension accruals (additional minimum liability), which amounted to EUR 230 million.

The decrease in the number of employees, both on average and on the balance sheet dates, is the result of offsetting effects: on the one hand, staff downsizing at T-Com and T-Systems in part resulting from reductions relating to the sale of shareholdings and, on the other hand, an increase in the number of employees at T-Mobile primarily in the U.S. and as a result of the first time full consolidation of T-Mobile Netherlands as of September 30, 2002.

Average number of employees

				For the six months ended June 30,																For the year ended December 31,
				2003				2002				Change				% Change				2002
Civil servants					50,198				53,850				(3,652	)			(6.8	)			52,961
Salaried employees (excl. civil servants)					202,503				202,366				137				0.1				202,935
Deutsche Telekom group					252,701				256,216				(3,515	)			(1.4	)			255,896
Trainees/student interns					9,811				9,192				619				6.7				9,869

Number of employees at balance sheet date

				As of June 30,																December 31,
				2003				2002				Change				% Change				2002
Civil servants					49,979				52,758				(2,779	)			(5.3	)			50,776
Salaried employees (excl. civil servants)					200,554				202,048				(1,494	)			(0.7	)			205,193
Deutsche Telekom group					250,533				254,806				(4,273	)			(1.7	)			255,969
Trainees/student interns					9,406				9,204				202				2.2				11,709

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Note (8) Depreciation and amortization

				Three months ended June 30,								Six months ended June 30,
				2003				2002				2003				2002
				(millions of €)
Amortization of intangible assets					(1,180	)			(1,635	)			(2,348	)			(3,124	)
of which: UMTS licenses					(148	)			(182	)			(299	)			(365	)
of which: U.S. mobile communications licenses					(128	)			(297	)			(265	)			(596	)
of which: goodwill					(629	)			(876	)			(1,270	)			(1,716	)
Depreciation of property, plant and equipment					(2,032	)			(2,585	)			(4,133	)			(4,750	)
Depreciation and amortization					(3,212	)			(4,220	)			(6,481	)			(7,874	)

The year-on-year decrease for the six month period ended June 30 of EUR 0.8 billion, or approximately 25 percent, in amortization of intangible assets is mainly a result of the reduced amortization base due to the high level of write-downs on goodwill and mobile communications licenses in the second half of 2002 as part of the strategic review. The decrease of around EUR 0.6 billion, or 13 percent, in depreciation of property, plant and equipment is mainly due – in addition to deconsolidation effects primarily from the sale of the cable business – to the non-recurrence of the write-downs on submarine cables amounting to EUR 0.2 billion in the previous year.

Note (9) Noncurrent assets

The components of noncurrent assets as of June 30, 2003 and December 31, 2002 are as follows:

				As of
				June 30, 2003				December 31, 2002
				(millions of €)
Intangible assets					48,894				53,402
of which: goodwill					26,781				29,436
of which: UMTS licenses					10,620				11,117
of which: U.S. mobile communications
licenses					9,290				10,364
Property, plant and equipment					48,822				53,955
Financial assets					3,509				4,169
Total noncurrent assets					101,225				111,526

The decline in intangible assets from EUR 53.4 billion to EUR 48.9 billion (8.4 percent) is due primarily to the effect of exchange rate losses on the translation of foreign Group companies (mainly relating to the decrease in value of the U.S. dollar compared with the euro) and to continued amortization.

The EUR 5.1 billion decrease in the carrying amount of property, plant and equipment is due primarily to the sale of the remaining cable businesses and further depreciation, combined with a decrease in the volume of new capital expenditures.

Investments

				For the six months ended June 30,
				2003				2002
				(millions of €)
Intangible assets					229				3,161
Property, plant and equipment					1,887				3,129
Financial assets					385				539
Total investments					2,501				6,829

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The decrease in investments is due in part to the cuts in capital expenditures made in the previous and current years as part of the Triple-E program, our program to enhance efficiency and achieve cost savings. Furthermore, investments in intangible assets were higher last year in part due to the acquisition of the remaining shares in T-Systems ITS GmbH (formerly debis Systemhaus GmbH) for EUR 2.7 billion.

Note (10) Shareholders' equity

The components of shareholders' equity as of June 30, 2003 and December 31, 2002 are as follows:

				As of
				June 30, 2003				December 31, 2002
				(millions of €)
Capital stock					10,746				10,746
Additional paid-in capital					50,085				50,077
Retained earnings					248				248
Unappropriated net income (loss) carried forward from previous year					(24,564	)			23
Net income (loss)					1,109				(24,587	)
Cumulative translation adjustment account					(6,690	)			(5,079	)
Minority interest					4,016				3,988
Shareholders' equity					34,950				35,416

The slight decrease in shareholders' equity compared with December 31, 2002, despite the positive Group result, is primarily due to further adverse exchange rate effects from the translation of foreign Group companies. 2,670,828 treasury shares were held at June 30, 2003.

Note (11) Liabilities

The components of liabilities as of June 30, 2003 and December 31, 2002 are as follows:

As of

June 30, 2003

December 31, 2002

(millions of €)

Debt

Bonds and debentures

56,776

56,752

Liabilities to banks