2015, 1st Quarter financial results
Very strong commercial performance. Revenues and EBITDA almost stable excluding regulatory measures.
- Commercial performance continued to be excellent in the 1st quarter of 2015, continuing the trend of the previous quarters: 2.8 million customers were added to the Group’s customer base during the quarter, with 10.9 million net additions year on year on a comparable basis (+4.6%), led by growth in mobile in Africa and the Middle East which had 100.6 million customers at 31 March 2015 (+11.3% year on year on a comparable basis).
In France, net additions of mobile contracts of 164,000 in the quarter were nearly double the 1st quarter of 2014 (+85,000). This performance was driven both by exceptional gross sales in the Enterprise market with the regaining of fleet management business, and a record 1st quarter in retail contracts. The Origami and Open premium offers represented more than 60% of gross retail sales and 4G had 800,000 net additions over the quarter. Fixed broadband had net sales of 68,000, with a market share of net adds estimated at 25% in the quarter, a significant increase from the 1st quarter of 2014 (+14 percentage points). The growth of fibre accelerated, with 75,000 net additions in the quarter.
Spain also recorded a very good performance in fixed broadband, led by fibre, with +50,000 net sales in the 1st quarter, and customer base growth of 13.4% year on year. Mobile contracts rose 5.8% year on year, and 4G had 600,000 net additions in the 1st quarter.
The 4G customer base was also up sharply in Poland, with 900,000 customers at 31 March 2015, an increase of 47% in three months, and in Belgium, with a 19% increase in the quarter and representing 25% of the mobile contracts (1) base at 31 March 2015.
- Revenues were 9.672 billion euros, with the decrease limited to 0.9% on a comparable basis, confirming the improving trend observed in the European countries primarily related to mobile services and mobile equipment sales, while steady growth continued in Africa and the Middle East. Excluding the impact of regulatory measures, revenues were almost stable in the 1st quarter of 2015 (-0.3%), versus a decrease of 3.0% in the 1st quarter of 2014.
- Restated EBITDA was 2.916 billion euros. Continuing efforts to reduce indirect costs halved the decline in restated EBITDA (2) to -55 million euros in the 1st quarter of 2015, compared to a decline of 120 million euros in the 1st quarter of 2014, on a comparable basis. The ratio of restated EBITDA to revenues was 30.1%, a limited decrease of 0.3 percentage points compared with the 1st quarter of 2014.
- CAPEX (1.190 billion euros) increased 3.0% on a comparable basis and represented 12.3% of revenues (+0.5 percentage points compared to the 1st quarter of 2014). The CAPEX level remained elevated, testament to the continuous efforts in very high-speed broadband in order to further differentiate the Group’s networks and services, in line with the announcements of the “Essentials2020” strategic plan.
Commenting on the publication of the operating results for the 1st quarter of 2015, Stéphane Richard, Chairman and CEO of the Orange Group, stated:
“Orange's commercial performance in the first quarter of 2015 has been very strong across our entire geographic footprint. These numbers testify to the quality of our offers that are tailored to the needs of our customers, as well as the effectiveness of our strategy of differentiation through investment in very high-speed broadband networks.
The benefits are already starting to show: we've signed up over 10 million 4G customers Europe-wide and fibre is proving to be a genuine driver of customer acquisition in both France and Spain. Globally, we now have 247 million customers, of which over 100 million are in Africa and the Middle East. These achievements have enabled us to effectively stabilise our revenues, excluding the impact of regulation.
At the same time our constant close attention to our cost base has allowed us to limit restated EBITDA margin erosion in terms of absolute value and so we are able to confirm our 2015 objectives. As a Group we are now fully focused on the operational implementation of our strategic plan Essentials2020, as presented last month, and which is centred on providing a truly outstanding customer experience.”
the entire press release is available on PDF file
(1) Excluding machine-to-machine contracts.
(2) Restated EBITDA from the 1st quarter compared with the 1st quarter of the previous year, on a comparable basis.
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Orange is one of the world’s leading telecommunications operators with sales of 40,9 billion euros in 2016 and 155,000 employees worldwide at 31 December 2016, including 96,000 employees in France. Present in 29 countries, the Group has a total customer base of 263 million customers worldwide at 31 December 2016, including 202 million mobile customers and 18 million fixed broadband customers. Orange is also a leading provider of global IT and telecommunication services to multinational companies, under the brand Orange Business Services. In March 2015, the Group presented its new strategic plan “Essentials2020” which places customer experience at the heart of its strategy with the aim of allowing them to benefit fully from the digital universe and the power of its new generation networks.
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