Bond Telefónica S.A. 1.875% ( XS0912992160 ) in EUR

Issuer Telefónica S.A.
Market price 100 %  ▼ 
Country  Spain
ISIN code  XS0912992160 ( in EUR )
Interest rate 1.875% per year ( payment 1 time a year)
Maturity 22/11/2018 - Bond has expired



Prospectus brochure of the bond Telefonica SA XS0912992160 in EUR 1.875%, expired


Minimal amount 1 000 EUR
Total amount 600 000 000 EUR
Detailed description Telefónica SA is a Spanish multinational telecommunications company offering fixed-line and mobile phone services, broadband internet access, and pay television.

The Bond issued by Telefónica S.A. ( Spain ) , in EUR, with the ISIN code XS0912992160, pays a coupon of 1.875% per year.
The coupons are paid 1 time per year and the Bond maturity is 22/11/2018









Prospectus
dated 14 November 2013

O2 Telefónica Deutschland Finanzierungs GmbH
(incorporated with limited liability under the laws of the Federal Republic of Germany,
having its corporate domicile in Munich, Federal Republic of Germany)
· · per cent Notes due 2018
unconditionally and irrevocably guaranteed by
Telefónica Deutschland Holding AG
(a stock corporation incorporated under the laws of the Federal Republic of Germany,
having its corporate domicile in Munich, Federal Republic of Germany)
Issue Price: · per cent
O2 Telefónica Deutschland Finanzierungs GmbH (the "Issuer") will issue on 22 November 2013 (the "Issue
Date") EUR · · per cent Notes due 2018 (the "Notes") under the unconditional and irrevocable guarantee (the
"Guarantee") of Telefónica Deutschland Holding AG (the "Guarantor"). The Notes will be redeemed at par on
22 November 2018 (the "Maturity Date"). The Notes will bear interest from and including 22 November 2013
to, but excluding, the Maturity Date at a rate of · per cent per annum, payable annually in arrears on
22 November in each year, commencing on 22 November 2014.
This prospectus (the "Prospectus") constitutes a prospectus within the meaning of Article 5.3 of the Directive
2003/71/EC of the European Parliament and of the Council of 4 November 2003 as amended from time to time
(the "Prospectus Directive"). This Prospectus will be published in electronic form together with all documents
incorporated by reference on the website of the Luxembourg Stock Exchange (www.bourse.lu). This Prospectus
has been approved by the Commission de Surveillance du Secteur Financier of the Grand Duchy of Luxembourg
(the "CSSF") in its capacity as competent authority under the Luxembourg law relating to prospectuses for
securities, as amended (Loi du 10 juillet 2005 relative aux prospectus pour valeurs mobilières ­ the "Prospectus
Law"), which implements the Prospectus Directive into Luxembourg law. The Issuer has requested the CSSF to
provide the competent authorities in the Federal Republic of Germany ("Germany"), The Netherlands and the
Republic of Austria ("Austria") and may request to provide competent authorities in additional host Member
States within the European Economic Area with a certificate of approval attesting that the Prospectus has been
drawn up in accordance with the Prospectus Law (the "Notification").
Application has been made for the Notes to be listed on the official list of the Luxembourg Stock Exchange and
to be admitted to trading on the regulated market of the Luxembourg Stock Exchange, which is a regulated
market for the purposes of Directive 2004/39/EC of the European Parliament and of the Council of 21 April
2004 on Markets in Financial Instruments, as amended.
Fitch Ratings has assigned to the Guarantor a Long-Term Issuer Default Rating (IDR) of "BBB" with a Stable
Outlook. A rating is not a recommendation to buy, sell or hold securities and may be subject to revision,
suspension or withdrawal at any time by the assigning rating organisation.
The Notes are issued in bearer form with a denomination of 1,000 each.
The Notes have been assigned the following securities codes: ISIN XS 0912992160,
Common Code 091299216, WKN A1TM8X.
The issue price, the aggregate principal amount of the Notes to be issued, the rate of interest, the number of notes
to be issued and the yield of the issue will be included in the Pricing Notice (as defined in "Subscription, Sale
and Offer of the Notes" below) which will be published on the website of the Luxembourg Stock Exchange
(www.bourse.lu) on or as soon as possible after the pricing date which is expected to be 15 November 2013.
Joint Lead Managers
Bayerische Landesbank

BofA Merrill Lynch
Commerzbank

UBS Investment Bank







RESPONSIBILITY STATEMENT
Each of O2 Telefónica Deutschland Finanzierungs GmbH (the "Issuer") with its corporate domicile in
Munich, Germany and Telefónica Deutschland Holding AG (the "Guarantor", together with its direct
and indirect subsidiaries and joint ventures at the date of this Prospectus collectively also referred to as
"we", "our" or "us") having its corporate domicile in Munich, Germany, accepts responsibility for the
information contained in and incorporated by reference into this Prospectus including the English
language translations of the Terms and Conditions and the Guarantee and hereby declares that, having
taken all reasonable care to ensure that such is the case, the information contained in this Prospectus is, to
the best of its knowledge, in accordance with the facts and does not omit anything likely to affect its
import.
Each of the Issuer and the Guarantor further confirms that (i) this Prospectus contains all information with
respect to the Issuer as well as to the Guarantor and their respective subsidiaries and affiliates and to the
Notes which is material in the context of the issue and offering of the Notes, including all information
which, according to the particular nature of the Issuer, the Guarantor and the Notes is necessary to enable
investors and their investment advisers to make an informed assessment of the assets and liabilities,
financial position, profits and losses, and prospects of the Issuer and the Guarantor and of the rights
attached to the Notes; (ii) the statements contained in this Prospectus relating to the Issuer, the Guarantor
and the Notes are in every material particular true and accurate and not misleading; (iii) there are no other
facts in relation to the Issuer, the Guarantor or the Notes the omission of which would, in the context of
the issue and offering of the Notes, make any statement in the Prospectus misleading in any material
respect; and (iv) reasonable enquiries have been made by the Issuer to ascertain such facts and to verify the
accuracy of all such information and statements.
As per Article 7(7) of the Prospectus Law, the CSSF gives no undertaking as to the economic and
financial soundness of the issue of the Notes and the quality or solvency of the Issuer.
This Prospectus contains financial and other information on E-Plus Mobilfunk GmbH & Co. KG and its
direct and indirect subsidiaries (the "E-Plus Group") (the "E-Plus Group Information") which has been
taken from sources that Koninklijke KPN N.V. ("KPN" and, together with its direct and indirect subsidiaries,
the "KPN Group") and the E-Plus Group have made publicly available, including a shareholders' circular
dated 21 August 2013 (including an addendum to such circular dated 29 August 2013) available on KPN's
website (www.kpn.com) and press releases of E-Plus Mobilfunk GmbH & Co. KG on its results for 2012
and the first half year of 2013 available on the website of the E-Plus Group (http://eplus-gruppe.de/). The
Issuer has accurately reproduced the E-Plus Group Information. However, neither the Issuer, nor the
Guarantor, nor the Joint Lead Managers (as defined below) have verified the E-Plus Group Information.
In particular, neither the Issuer, nor the Guarantor or Telefónica, S.A. had been able to perform a due
diligence on the E-Plus Group with a scope and to such extent as would have been necessary to verify the
E-Plus Group Information. Neither the Issuer, nor the Guarantor, nor the Joint Lead Managers therefore
assumes responsibility for the accuracy and completeness of the E-Plus Group Information.

- ii -



CONSENT TO USE THE PROSPECTUS
Each Joint Lead Manager (together, the "Joint Lead Managers") and/or each further financial
intermediary subsequently reselling or finally placing Notes is entitled to use the Prospectus in Germany,
The Netherlands, Luxembourg and Austria, for the subsequent resale or final placement of the Notes
during the offer period commencing on 15 November 2013 and ending on 22 November 2013, provided
however, that the Prospectus is still valid in accordance with Article 11 of the Luxembourg act relating to
prospectuses for securities (Loi relative aux prospectus pour valeurs mobilières) which implements
Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 (as amended
by Directive 2010/73/EU of the European Parliament and of the Council of 24 November 2010). The
Issuers accept responsibility for the information given in the Prospectus also with respect to such
subsequent resale or final placement of the relevant Notes.
The Prospectus may only be delivered to potential investors together with all supplements published
before such delivery. Any supplement to the Prospectus is available for viewing in electronic form on the
website of the Luxembourg Stock Exchange (www.bourse.lu).
When using the Prospectus, each Joint Lead Manager and/or relevant further financial intermediary must
make certain that it complies with all applicable laws and regulations in force in the respective
jurisdictions.
In the event of an offer being made by a Joint Lead Manager and/or a further financial
intermediary, the Joint Lead Manager and/or the further financial intermediary shall provide
information to investors on the terms and conditions of the offer at the time of that offer.
Any Joint Lead Manager and/or further financial intermediary using the Prospectus has to state on
its website that it uses the Prospectus in accordance with this consent and the conditions attached
thereto.
NOTICE
No person is authorised to give any information or to make any representations other than those contained
in this Prospectus and, if given or made, such information or representations must not be relied upon as
having been authorised by or on behalf of the Issuer, the Guarantor or the Joint Lead Managers (as
defined in "SUBSCRIPTION, SALE AND OFFER OF THE NOTES"). Neither the delivery of this
Prospectus nor any offering or sale of any Notes made hereunder shall, under any circumstances, create
any implication that there has been no change in the affairs of the Issuer or the Guarantor or any of its
affiliates since the date of this Prospectus, or that the information herein is correct at any time since its
date.
This Prospectus contains certain forward-looking statements, in particular statements using the words
"believes", "anticipates" "intends", "expects" or other similar terms. This applies in particular to
statements under the caption "GENERAL INFORMATION ON THE ISSUER ­ Business", under the
caption "GENERAL INFORMATION ON THE GUARANTOR - Business" and under the caption
"ACQUISITION OF THE E-PLUS GROUP" and statements elsewhere in this Prospectus relating to,
among other things, the future financial performance, potential synergies to be realised in connection with
the planned acquisition of the E-Plus Group, plans and expectations regarding developments in the
business of the Issuer and the Guarantor, as the case may be. These forward-looking statements are
subject to a number of risks, uncertainties, assumptions and other factors that may cause the actual results,
including the financial position and profitability of the Issuer and the Guarantor, as the case may be, to be
materially different from or worse than those expressed or implied by these forward-looking statements.
Neither the Issuer nor the Guarantor do assume any obligation to update such forward-looking statements
and to adapt them to future events or developments.
This Prospectus should be read and understood in conjunction with any supplement hereto and with any
other documents incorporated herein by reference.
To the fullest extent permitted by law, neither the Joint Lead Managers nor any other person mentioned in
this Prospectus, except for the Issuer and the Guarantor, is responsible for the information contained in
this Prospectus or any other document incorporated herein by reference, and accordingly, and to the
extent permitted by the laws of any relevant jurisdiction, none of these persons accepts any responsibility
for the accuracy and completeness of the information contained in any of these documents. The Joint
Lead Managers have not independently verified any such information and accept no responsibility for the
accuracy thereof.
- iii -



Each investor contemplating purchasing any Notes should make its own independent investigation of the
financial condition and affairs, and its own appraisal of the creditworthiness of the Issuer and of the
Guarantor. This Prospectus does not constitute an offer of Notes or an invitation by or on behalf of the
Issuer, the Guarantor or the Joint Lead Managers to purchase any Notes. Neither this Prospectus nor any
other information supplied in connection with the Notes should be considered as a recommendation by
the Issuer, the Guarantor or the Joint Lead Managers to a recipient hereof and thereof that such recipient
should purchase any Notes.
This Prospectus does not constitute, and may not be used for the purposes of, an offer or solicitation by
anyone in any jurisdiction in which such offer or solicitation is not authorised or to any person to whom it
is unlawful to make such offer or solicitation.
The offer, sale and delivery of the Notes and the distribution of this Prospectus in certain jurisdictions are
restricted by law. Persons into whose possession this Prospectus comes are required by the Issuer and the
Joint Lead Managers to inform themselves about and to observe any such restrictions. In particular, the
Notes have not been and will not be registered under the United States Securities Act of 1933, as amended
(the "Securities Act") and are subject to U.S. tax law requirements. Subject to certain limited exceptions,
the Notes may not be offered, sold or delivered within the United States of America ("United States") or
to U.S. persons. For a further description of certain restrictions on offerings and sales of the Notes and
distribution of this Prospectus (or of any part thereof) see "SUBSCRIPTION, SALE AND OFFER OF
THE NOTES ­ Selling Restrictions."
IN CONNECTION WITH THE ISSUE OF THE NOTES, UBS LIMITED (OR PERSONS
ACTING ON ITS BEHALF) MAY OVER-ALLOT NOTES OR EFFECT TRANSACTIONS
WITH A VIEW TO SUPPORTING THE PRICE OF THE NOTES AT A LEVEL HIGHER THAN
THAT WHICH MIGHT OTHERWISE PREVAIL. HOWEVER, THERE IS NO ASSURANCE
THAT UBS LIMITED (OR PERSONS ACTING ON ITS BEHALF) WILL UNDERTAKE
STABILISATION ACTION. ANY STABILISATION ACTION MAY BEGIN AT ANY TIME
AFTER THE ADEQUATE PUBLIC DISCLOSURE OF THE TERMS OF THE OFFER OF THE
NOTES AND, IF BEGUN, MAY BE ENDED AT ANY TIME, BUT IT MUST END NO LATER
THAN THE EARLIER OF 30 CALENDAR DAYS AFTER THE DATE OF THE RECEIPT OF
THE PROCEEDS OF THE ISSUE BY THE ISSUER AND 60 CALENDAR DAYS AFTER THE
DATE OF THE ALLOTMENT OF THE NOTES. SUCH STABILISING SHALL BE IN
COMPLIANCE WITH ALL LAWS, DIRECTIVES, REGULATIONS AND RULES OF ANY
RELEVANT JURISDICTION.
In this Prospectus all references to "", "EUR" or "Euro" are to the currency introduced at the start of the
third stage of the European economic and monetary union, and as defined in Article 2 of Council
Regulation (EC) No 974/98 of 3 May 1998 on the introduction of the Euro, as amended.

- iv -



CONTENTS

RESPONSIBILITY STATEMENT ............................................................................................................. ii
CONSENT TO USE THE PROSPECTUS .................................................................................................iii
NOTICE ......................................................................................................................................................iii
SUMMARY ............................................................................................................................................ - 1 -
GERMAN TRANSLATION OF THE SUMMARY............................................................................. - 16 -
RISK FACTORS ................................................................................................................................... - 34 -
USE OF PROCEEDS ............................................................................................................................ - 53 -
INFORMATION ON THE GUARANTOR .......................................................................................... - 54 -
INFORMATION ON THE ISSUER ..................................................................................................... - 88 -
TERMS AND CONDITIONS ............................................................................................................... - 93 -
DESCRIPTION OF RULES REGARDING RESOLUTIONS OF HOLDERS ................................. - 115 -
TAXATION ........................................................................................................................................ - 116 -
SUBSCRIPTION, SALE AND OFFER OF THE NOTES ................................................................. - 124 -
GENERAL INFORMATION / INCORPORATION BY REFERENCE ............................................ - 127 -
NAMES AND ADDRESSES .................................................................................................................. - 1 -



- v -



SUMMARY
Summaries are made up of disclosure requirements known as "Elements". These elements are numbered in Sections A ­
E (A.1 ­ E.7).
This summary (the "Summary") contains all the Elements required to be included in a summary for this type of
securities and issuer. Because some Elements are not required to be addressed, there may be gaps in the numbering
sequence of the Elements.
Even though an Element may be required to be inserted in the summary because of the type of securities and issuer, it is
possible that no relevant information can be given regarding the Element. In this case a short description of the Element
is included in the summary with the mention of "not applicable".
Section A ­ Introduction and warnings
A.1
Introduction Warning that:
this Summary should be read as an introduction to the Prospectus;
any decision to invest in the Notes should be based on consideration of the Prospectus as
a whole by the investor;
where a claim relating to the information contained in the Prospectus is brought before a
court, the plaintiff investor might, under the national legislation of the Member States,
have to bear the costs of translating the Prospectus, before the legal proceedings are
initiated; and
civil liability attaches only to the Issuer which has tabled the Summary including any
translation thereof, but only if the Summary is misleading, inaccurate or inconsistent
when read together with the other parts of the Prospectus or it does not provide, when
read together with the other parts of the Prospectus, key information in order to aid
investors when considering whether to invest in such the Notes.
A.2
Consent
Each Joint Lead Manager and/or each further financial intermediary subsequently reselling or
finally placing the Notes is entitled to use the Prospectus for the subsequent resale or final
placement of the Notes in Luxembourg, the Federal Republic of Germany, The Netherlands and
the Republic of Austria during the offer period for the subsequent resale or final placement of the
Notes from 15 November 2013 to 22 November 2013.
The Prospectus may only be delivered to potential investors together with all supplements
published before such delivery.
When using the Prospectus, each Joint Lead Manager and/or relevant further financial
intermediary must make certain that it complies with all applicable laws and regulations in force
in the respective jurisdictions.
In the event of an offer being made by a Joint Lead Manager and/or a further financial
intermediary, the Joint Lead Manager and/or the further financial intermediary shall
provide information to investors on the terms and conditions of the Notes at the time of that
offer.

Section B ­ O2 Telefónica Deutschland Finanzierungs GmbH as Issuer
B.1
Legal
and Legal and commercial name of the Issuer is O2 Telefónica Deutschland Finanzierungs
commercial name of GmbH (formerly named Telefónica Deutschland Finanzierungs GmbH) (the "Issuer").
the Issuer
B.2
Domicile, legal form, The Issuer is incorporated as a limited liability company (Gesellschaft mit beschränkter
legislation, country Haftung) organised and operating under the laws of the Federal Republic of Germany. Its
of incorporation
business address is Georg-Brauchle-Ring 23-25, 80992 Munich, Federal Republic of
Germany.
B.4b
Trends
Not applicable; there are no trends affecting the Issuer.
B.5
Description of the Telefónica Germany GmbH & Co. OHG directly holds 100% of the shares in the Issuer.
Group
and
the 100% of Telefónica Germany GmbH & Co. OHG's shares are directly and indirectly held
Issuer's
position by Telefónica Deutschland Holding AG (the "Guarantor"; the Guarantor together with its
within the Group
direct and indirect subsidiaries and joint ventures: "Telefónica Deutschland", hereafter
also referred to as "we" and "our"). 76.83% of the Guarantor's shares are held by
Telefónica Germany Holdings Limited which is an indirectly wholly owned subsidiary of

- 1 -




Telefónica, S.A. (Telefónica, S.A. collectively with its direct and indirect subsidiaries ­
excluding Telefónica Deutschland: "Telefónica Group").
B.9
Profit forecast or Not applicable; no profit forecast or estimate is made.
estimate
B.10
Qualifications in the Not applicable; there are no qualifications.
audit opinion on the
historical financial
information
B.12
Selected
historical
key
financial
information
The selected historical key financial information of the Issuer below as of 6 March 2013 was taken from the
Issuer's audited opening balance sheet dated as of 6 March 2013, prepared in accordance with the provisions of the
German Commercial Code (Handelsgesetzbuch; HGB):
Selected Financial Information
6 March 2013
in
Bank balances
25,000
Total Assets
25,000
Unregistered capital contribution
25,000
Total Equity and Liabilities
25,000

A statement that There has been no material adverse change in the prospects of O2 Telefónica Deutschland
there has been no Finanzierungs GmbH since 6 March 2013.
material
adverse
change
in
the
prospects
of
the
issuer since the date
of its last published
audited
financial
statements
or
a
description of any
material
adverse
change.
A description of There has been no significant change in the financial or trading position of O2 Telefónica
significant changes Deutschland Finanzierungs GmbH since 6 March 2013.
in the financial or
trading
position
subsequent to the
period covered by
the
historical
financial
information.
B.13
Recent Events
With effect as of 7 November 2013, the legal and commercial name of the Issuer has been
changed to "O2 Telefónica Deutschland Finanzierungs GmbH".
B.14
Please see Element B.5.
Dependence
upon O2 Telefónica Deutschland Finanzierungs GmbH is a wholly-owned subsidiary of
other entities within Telefónica Germany GmbH & Co. OHG. It is dependent upon its owner Telefónica
the group
Germany GmbH & Co. OHG.
B.15
A description of the The Issuer's sole business activity is the provision of liquid funds to finance the business
issuer's
principal operations of companies within Telefónica Deutschland by among others, the issuance of
activities.
bonds.
B.16
Controlling Persons O2 Telefónica Deutschland Finanzierungs GmbH is a wholly-owned subsidiary of
Telefónica Germany GmbH & Co. OHG. Telefónica Germany GmbH & Co. OHG directly
holds all shares in the Issuer and exercises control over the Issuer directly.
B.17
Credit
ratings Not applicable; the Issuer or its debt securities have not been rated.
assigned
to
the
Issuer or its debt
securities
124504-4-18-v6.4
- 2 -
41-40541595




Section B ­Telefónica Deutschland Holding AG as Guarantor
B.1
Legal
and Legal and commercial name of the Guarantor is Telefónica Deutschland Holding AG.
commercial name of
the Guarantor
B.2
Domicile, legal form, Telefónica Deutschland Holding AG is a German stock corporation (Aktiengesellschaft)
legislation, country incorporated under the laws of and domiciled in the Federal Republic of Germany. Its
of incorporation
business address is Georg-Brauchle-Ring 23-25, 80992 Munich, Federal Republic of
Germany.
B.4b
Trends
Telefónica Deutschland expects the German telecommunication market to remain active
and competitive in the medium term, with significant impacts from mobile termination rate
cuts, changing customers' communication behaviours, and the variability of device
launches and replacement cycles. Telefónica Deutschland expects to be impacted by the
variability of these diverging trends. Telefónica Deutschland has observed an increasing
pressure on revenues throughout the year 2013 from competition, changing customers'
communication behaviour and regulation and has further noticed a significant level of
competition around smartphone Universal Mobile Telecommunications System ("UMTS"
or "3G") tariffs and device bundles (bundled offers of tariff and device). Telefónica
Deutschland believes that additional levers, such as the introduction of the Long Term
Evolution ("LTE" or "4G") technology and convergent fixed-mobile data services will be
key factors for its medium-term profitability as standalone business, with the recently
announced acquisition of the business of E-Plus Mobilfunk GmbH & Co. KG and its direct
and indirect subsidiaries (the "E-Plus Group"), which conducts the German mobile
telecommunications business of Koninklijke KPN N.V. (subject to regulatory approval and
merger clearance), amplifying this opportunity in the medium term.
B.5
Description of the Telefónica Germany Holdings Limited holds 76.83% of the shares in the Guarantor.
Group
and
the Telefónica Germany Holdings Limited is indirectly wholly-owned by Telefónica, S.A.
Guarantor's position
within the Group
B.9
Profit forecast or Not applicable; no profit forecast or estimate is made.
estimate
B.10
Qualifications in the Not applicable; Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft, Stuttgart, Munich
audit opinions on Office, issued unqualified audit opinions on the consolidated financial statements of
the
historical Telefónica Deutschland Holding AG as of and for the year ended 31 December 2012 and
financial
on the combined financial statements of Telefónica Deutschland Holding AG (formerly
information
Telefónica Germany Verwaltungs GmbH) as of and for the years ended 31 December
2011, 2010 and 2009.
B.12
Selected
historical The selected key financial information of the Guarantor below as of and for the year ended
key
financial 31 December 2011 was taken or derived from the Guarantor's audited combined financial
information
statements as of and for the years ended 31 December 2011, 2010 and 2009, prepared in
accordance with International Financial Reporting Standards, as adopted by the European
Union, ("IFRS") taking into account the basis of preparation as set out in Note 1 to the
combined financial statements (the "Combined Financial Statements 2009-2011"), and
the selected key financial information as of and for the year ended 31 December 2012 from
the Guarantor's audited consolidated financial statements as of and for the year ended
31 December 2012, prepared in accordance with IFRS and the additional requirements of
German commercial law pursuant to Section 315a (1) German Commercial Code
(Handelsgesetzbuch; HGB) (the "Consolidated Financial Statements 2012") as well as
for each of these years from the Guarantor's accounting records or internal management
reporting systems. The selected key financial information of the Guarantor below as of
30 September 2013 and for the nine months ended 30 September 2013 and 30 September
2012 were taken or derived from the Guarantor's unaudited interim condensed
consolidated financial statements as of and for the nine months ended 30 September 2013
prepared in accordance with IFRS on interim financial reporting (International Accounting
Standard (IAS) 34) (the "Unaudited Interim Condensed Consolidated Financial
Statements"), as well as for these nine month periods from the Guarantor's accounting
records or internal management reporting systems.
The Consolidated Financial Statements 2012 include the assets and liabilities, and the
Consolidated Financial Statements 2012 as well as the Unaudited Interim Condensed
Consolidated Financial Statements include the income and expenses and cash flows of the
entities Group 3G UMTS Holding GmbH, Quam GmbH and Telefónica Global Services
GmbH, together with its subsidiaries Telefónica Global Roaming GmbH, Telefónica
124504-4-18-v6.4
- 3 -
41-40541595




Compras Electronicas S.L., and the indirectly held 40% interest in Adquira España S.A.
until 1 October 2012 when these entities ceased to be direct and indirect subsidiaries or
associates of the Guarantor. According to IFRS 5 "Non-current assets held for sale and
discontinued operations" the income and expenses and cash flows of these sold entities are
separately disclosed in the consolidated income statement of the Consolidated Financial
Statements 2012 and of the Unaudited Interim Condensed Consolidated Financial
Statements, respectively, as profit after taxes from discontinued operations and in the
consolidated statement of cash flows of the Consolidated Financial Statements 2012 and of
the Unaudited Interim Condensed Consolidated Financial Statements, respectively, as cash
flow from operating activities from discontinued operations, cash flow from investing
activities from discontinued operations and cash flows from financing activities from
discontinued operations, respectively. However, according to IFRS 5 "Non-current assets
held for sale and discontinued operations" the assets and liabilities of these sold entities are
not separately disclosed in the comparative financial information as of 31 December 2011
in the consolidated statement of financial position of the Consolidated Financial
Statements 2012.
The Combined Financial Statements 2009-2011 do not include the assets and liabilities,
income and expenses and cash flows of the sold entities mentioned above.
Where financial information in the following table is labelled "audited", this means that it
was taken or derived from the Combined Financial Statements 2009-2011 or from the
Consolidated Financial Statements 2012. The label "unaudited" is used in the following
table to indicate financial information that was not taken or derived from the Combined
Financial Statements 2009-2011 or Consolidated Financial Statements 2012.


The table below sets forth certain selected income and cash flow information of Telefónica
Deutschland for the years ended 31 December 2012 and 2011 and for the nine months
ended 30 September 2013 and 2012:

For the year ended
For the nine months

31 December
ended 30 September
2012
2011
2013
2012

(in thousand, unless
(in thousand, unless

otherwise indicated)
otherwise indicated)
(audited, unless
(unaudited)

otherwise indicated)
Revenues: .........................................................................................
5,212,838
5,035,552
3,670,691
3,870,768
Wireless Business .............................................................................
3,845,053
3,605,747
2,728,737
2,831,543
Wireless Service Revenues1 ...................................................
3,151,838
2,946,465
2,246,366
2,359,265
Handset Revenues ..................................................................
693,215
659,282
482,371
472,278
Wireline Business .............................................................................
1,363,203
1,425,740
937,597
1,035,810
Other .................................................................................................
4,582
4,065
4,357
3,415
OPERATING INCOME BEFORE
DEPRECIATION AND AMORTISATION
(OIBDA) ...........................................................................................
1,279,074 1,149,237
864,062
936,200
PROFIT OR LOSS FOR THE
YEAR/PERIOD FROM CONTINUING
OPERATIONS/RESULT FOR THE YEAR2 ...............................
307,523
71,346
(823)
108,349
Basic earnings per share from continuing
operations/basic earnings per share (2011
unaudited)3 () ..............................................................................................................................
0.28
0.06
(0.00)
0.10
OPERATING CASH FLOW (OIBDA-
CapEx) FROM CONTINUING
OPERATIONS/OPERATING CASH
FLOW (OIBDA-CapEx) (unaudited)4................................
67 ...........
0,233
591,586
396,399
484,084
FREE CASH FLOW PRE DIVIDENDS
FROM CONTINUING
OPERATIONS/FREE CASH FLOW PRE
DIVIDENDS (unaudited)5 ..............................................................
675,957
697,048
543,567
552,946

1 Adjusted for the effect of substantial decreases in voice mobile termination rates ("MTR") in December 2012, Wireless Service
Revenues would have been 9 million higher in the year ended 31 December 2012 and 91.8 million higher in the nine months
ended 30 September 2013 (MTR cut from 0.0339 until 30 November 2012 to 0.0185 after 1 December 2012).
2 Result for the year 2011 as disclosed in the Combined Financial Statements 2009-2011. No discontinued operations in 2013.
3 Basic earnings per share from continuing operations for 2012 are calculated as profit attributable to ordinary equity holders of the
124504-4-18-v6.4
- 4 -
41-40541595




parent from continuing operations (equal to the profit for the year from continuing operations) for 2012 divided by the weighted
average number of ordinary shares for 2012 in the amount of 1,117,001 thousand. Basic earnings per share for 2011 (unaudited) are
calculated as result for the year 2011 divided by the weighted average number of ordinary shares of 2012. For comparability
purposes, the 2012 weighted average number of ordinary shares also has been used for the year 2011. Basic earnings per share from
continuing operations for the nine months ended 30 September 2013 and 2012 are calculated as profit or loss attributable to ordinary
equity holders of the parent from continuing operations (equal to the profit or loss for the period from continuing operations) divided
by the weighted average number of ordinary shares for the nine months ended 30 September 2013 in the amount of 1,116,945
thousand. For comparability purposes, the weighted average number of ordinary shares for the nine months ended 30 September 2013
also has been used for nine months ended 30 September 2012.
4 Operating cash flow (OIBDA-CapEx) from continuing operations for 2012 as well as for the nine months ended 30 September 2013
and 2012 is calculated as OIBDA from continuing operations minus Capital Expenditures ("CapEx") from continuing operations.
Operating cash flow (OIBDA-CapEx) for 2011 is calculated as OIBDA minus Capital Expenditures (CapEx). CapEx is defined as
additions of property, plant and equipment and intangible assets derived from the composition of and movements in property, plant
and equipment and intangible assets information. CapEx from continuing operations in 2012 amount to 608,841k, CapEx in 2011
amount to 557,651k and CapEx from continuing operations in the nine months ended 30 September 2013 and 2012 amount to
467,663k and 452,116k, respectively.
5 Free cash flow pre dividends from continuing operations for 2012 and the nine months ended 30 September 2013 and 2012 is defined
as the sum of cash flow from operating activities from continuing operations and cash flow from investing activities from continuing
operations derived from the Consolidated Financial Statements 2012 and the Unaudited Interim Condensed Consolidated Financial
Statements, respectively. Free Cash flow pre dividends for 2011 is defined as the sum of cash flow from operating activities and cash
flow from investing activities derived from the Combined Financial Statements 2009-2011.

A statement that There has been no material adverse change in the prospects of Telefónica Deutschland
there has been no Holding AG since 31 December 2012.
material
adverse
change
in
the
prospects
of
the
Guarantor since the
date of its last
published
audited
financial statements
or a description of
any material adverse
change.

A description of There has been no significant change in the financial or trading position of Telefónica
significant changes Deutschland Holding AG since 30 September 2013.
in the financial or
trading
position
subsequent to the
period covered by
the
historical
financial
information.
B.13
Recent Events
On 2 May 2013, Telefónica Deutschland and Telekom Deutschland GmbH signed a
"memorandum of understanding" broadening their cooperation with regard to fixed-line
services and providing for Telefónica Deutschland's expanded access to the advanced
network infrastructure of Telekom Deutschland (the so-called "next generation access
platform" or NGA platform) enabling Telefónica Deutschland to offer its customers high-
speed internet products with data transfer rates of up to 100Mbit/s. In June 2013, the
Federal Cartel Office (Bundeskartellamt) has confirmed that the cooperation is not subject
to merger control clearance. The proceeding for the clearance of the envisaged cooperation
by the Federal Network Agency has been initiated in October 2013 and is expected to be
finalised by the end of 2013. The start of the cooperation, which is still subject to final and
binding agreement with Telekom Deutschland GmbH, which is currently envisaged to be
entered into by the end of 2013, is scheduled for 2014. The completion of the transition
from Telefónica Deutschland's Asymmetrical Digital Subscriber Line ("ADSL")
infrastructure to the NGA platform of Deutsche Telekom is expected for 2019.
In a German law governed sale and purchase agreement dated 23 July 2013, as amended
on 26 August 2013 and 28 August 2013, between Koninklijke KPN N.V. ("KPN" and,
together with its direct and indirect subsidiaries, the "KPN Group"), Telefónica, S.A. and
the Guarantor (the "SPA"), the Guarantor agreed to purchase all assets, certain liabilities
and business activities of the E-Plus Group which conducts the business activities of KPN
Group on the German telecommunications market (the "Transaction").
Upon consummation of the Transaction, KPN will receive (i) 3.7 billion in cash from the
Guarantor (this cash component to be financed by a capital increase of the Guarantor
against contribution in cash via a public rights offering) and (ii) shares to be issued by the
Guarantor. The shares to be issued to KPN shall represent 24.9% of the Guarantor's total
issued share capital following the implementation of (i) the capital increase against
contributions in cash mentioned above and (ii) a further increase in the capital against
124504-4-18-v6.4
- 5 -
41-40541595