Financial information for the 3rd quarter of 2015

Paris, Thursday, October 22, 2015

Return to growth in 3rd quarter validates strategy of differentiation through quality and investment

  • Revenues were 10.284 billion euros in the 3rd quarter of 2015, an increase of 0.5% on a comparable basis , after falling 0.2% in the 2nd quarter and 0.9% in the 1st quarter. The trend of continued improvement reflects the favourable change in mobile services across all regions (growth of 1.2% in the 3rd quarter after declines of 1.6% in the 2nd quarter and 2.8% in the 1st quarter). Similarly, Enterprise segment revenues rose 0.5% in the 3rd quarter, continuing the improvement seen in the previous quarter. Excluding the impact of regulatory measures, Group revenues rose 0.6% in the 3rd quarter, after an increase of 0.4% in the 2nd quarter and a decrease of 0.3% in the 1st quarter.

  • Restated EBITDA (3.557 billion euros in the 3rd quarter of 2015) rose 1.1% on a comparable basis and the restated EBITDA margin was 34.6% (up 0.2 percentage points in relation to the 3rd quarter of 2014). Restated EBITDA for the first nine months of the year (9.364 billion euros) was down 0.4% and the restated EBITDA margin (31.4%) was stable compared with the previous year.

  • Commercial momentum remained very strong in the 3rd quarter of 2015 across all regions. With the full consolidation of Jazztel in Spain and of Méditel in Morocco, the Orange Group had a total of 263.3 million customers at 30 September 2015, a year-on-year increase of 4.6% on a comparable basis (11.6 million net additions). In France, the 3rd quarter performance in mobile services was very satisfactory with 234,000 net contract additions(1 ), following the strong performance in the 1st half. There were 6.6 million 4G customers at 30 September 2015 with 1.0 million net additions over the quarter. Fixed broadband also had an excellent performance with 116,000 net additions in the 3rd quarter, led by fibre which had 827,000 customers at 30 September 2015 (108,000 net additions in the quarter). In Spain, fibre grew rapidly, supported by the strategy to migrate Orange customers to the Jazztel fibre network: there were 142,000 net additions in fibre in the 3rd quarter for a total customer base of 563,000 at 30 September 2015. 4G growth was very strong with 4.5 million customers at 30 September 2015 (+1.0 million in the 3rd quarter). 4G also rose sharply in the other European countries, with 1.6 million customers in Poland, 800,000 in Belgium & Luxembourg, 750,000 in Romania and 450,000 in Slovakia at 30 September 2015. In Africa & Middle East, the mobile customer base grew steadily, with 10.0 million net additions year on year on a comparable basis (+9.8%) and 15.5 million Orange Money customers at 30 September 2015 (+37% year on year).

  • CAPEX (4.235 billion euros at 30 September 2015) rose 6.9% on a comparable basis, representing 14.2% of revenues (+0.9 percentage points compared with the previous year). In line with the Essentiels2020 strategic plan, investments in fibre were sharply up (+57% compared to the first nine months of 2014), principally in Europe and in France in particular. [

Outlook for 2015

With solid results at 30 September 2015, the Group now expects restated EBITDA of at least 12.3 billion euros for the full year 2015. This objective takes into account the consolidation of Jazztel and Méditel from 1 July 2015 and the disposal of Orange Armenia on 3 September. This corresponds to the top end of the target range announced at the beginning of the year(2 ) for the previous scope of operations. Moreover, the Group confirms the objective of a restated ratio of net debt/EBITDA of around 2x in the medium term in order to preserve Orange’s financial strength and investment capacity. In this regard, the Group is pursuing a policy of selective acquisitions, concentrating on markets in which it is already present. In addition, the Group confirms the payment of a dividend of 0.60 euros per share for 2015(3 ). An interim dividend for 2015 of 0.20 euros per share will be paid on 9 December 2015(4 ).

Commenting on the results for the first nine months of 2015, Orange Group Chairman and CEO Stéphane Richard stated: “ Our return to growth in revenue and restated EBITDA validates our strategy of differentiation through quality and investment and confirms the positive momentum generated over almost two years. Our business performed particularly well this quarter, especially in France, Spain, Belgium, Central Europe, Africa & Middle East and the Enterprise market. This commercial momentum is supported by high levels of investment in very high-speed fixed and mobile broadband, in line with our Essentiels2020 strategic plan. We have now exceeded 263 million customers worldwide with 111 million in Africa & Middle East. In France and the rest of Europe, we have 15 million 4G customers and 17 million in fixed broadband, of which 1.5 million use fibre. Propelled by this momentum and driven by our ambition to deliver an unrivalled customer experience, we now aim to achieve the high end of the range for the objectives initially set for 2015 .”

  • The entire press release is available on PDF file *

(1 ) Excluding machine-to-machine contracts. (2 ) Objective of the previous perimeter: “achieve restated EBITDA of between 11.9 and 12.1 billion euros for the full year of 2015.” (3 ) Subject to the approval of the Annual General Meeting of shareholders. (4 ) The ex-dividend date is set at 7 December 2015 and the record date is set at 8 December 2015.



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