* German adjusted EBITDA up 4 pct
* T-Mobile US reported strong figures this month
* Shares seen up 1.3 pct, outperforming DAX (Adds detail on Germany, shares, analyst, outlook, rivals)
By Georgina Prodhan
BERLIN, Feb 25 (Reuters) - Deutsche Telekom reported better than expected fourth-quarter results in itsdomestic market, helped by expansion of its super-fast broadbandnetwork, boosting take-up of bundled fixed line, mobile andInternet TV packages.
Though Germans spend relatively little on mobile usage --about half as much as customers in the United States -- pricesare supported by a strong economy and consolidation of themarket to three operators from four in 2014.
The company's core profit in Germany rose by 4 percent andmobile service revenue was broadly stable, with a small increasein customer numbers against a slight decline across the broaderGerman mobile market, Deutsche Telekom said on Thursday.
Together with strong figures already reported this month byits large U.S. business T-Mobile US, Deutsche beatexpectations with a 16 percent increase in fourth-quarteradjusted earnings before interest, tax, depreciation andamortisation (EBITDA).
Its shares were indicated to open with a 1.3 percent gain,according to brokerage Lang & Schwarz, outperforming Germany'sDAX index.
"Deutsche Telekom was extremely successful on both sides ofthe Atlantic. We are continuing on our path to becoming theleading European telecommunications provider with further stronginvestments this year," Chief Executive Timotheus Hoettges said.
The German group, which also has operations in severalcentral and eastern European countries and in Britain, said cashcapital expenditure would rise by about 4 percent this year asit continues to expand and upgrade its networks.
U.S. AUCTION
That figure excludes spending on an auction for new mobilecapacity in the United States, expected to cost abound $10billion. It is also expanding its broadband network in ruralGermany under a government plan to increase Internet access.
Sales are expected to rise this year, the company said, witha strong rise in the United States outweighing declines inGermany and the rest of Europe.
Adjusted EBITDA is expected to increase by about 2 percent,entirely driven by the United States, where a new offer forcustomers to lease rather than buy handsets will flatter profitsbefore depreciation.
"The outlook is slightly below consensus but may includesome cushion due to conservatism," said DZ Bank analyst KarstenOblinger, who rates Deutsche Telekom a "buy".
Deutsche Telekom this month announced price increases to itsmobile packages from April in exchange for more generous dataallowances, free EU roaming and access to wi-fi hotspots.
Telefonica Deutschland , which has moremobile customers than Deutsche Telekom but lower servicerevenues, said on Thursday that it expects modest growth inoperating profit this year as costs relating to its integrationof E-Plus continue to weigh.
Britain's Vodafone, which owns Germany's thirdmobile operator, cited Germany as a highlight as it reported asixth consecutive quarter of underlying revenue growth thismonth. ($1 = 0.9065 euros) (Editing by Victoria Bryan and David Goodman)