Press
release
Paris, 26 October 2017
Solid growth in
third quarter 2017 revenue and adjusted EBITDA. Record mobile sales
in France
-
Revenues grew 0.9% on a
comparable basis to 10.274 billion euros in the third quarter of
2017, in line with the first half (+1.1%). The impact of new
regulations in Europe, with the end of roaming charges for
customers travelling in Europe, was largely offset by increased
interconnection revenue with operators in other European countries
(visitor roaming) resulting from increased usage by their customers
on Orange networks across Europe.
France posted growth for the second consecutive
quarter and the Europe segment continued to record sustained
growth, driven by Spain and Central European countries. Revenue in
the Africa & Middle East segment confirmed a return to solid
growth, while revenue in the Enterprise segment fell 0.5% on a
comparable basis. In the first nine months of 2017, revenues were
30.550 billion euros, up 1.0% (+317 million euros) on a comparable
basis.
-
The Group's adjusted EBITDA
grew 2.1% in the third quarter of 2017 on a comparable basis, in
line with the first half (+2.2%). This was despite the impact
of the first full quarter since new European regulations ended
roaming charges and increased interconnection costs with operators
in other countries. In the first nine months of 2017, the Group's
adjusted EBITDA was 9.599 billion euros, an increase of 2.2% (+203
million euros) on a comparable basis.
Adjusted EBITDA from telecom
activities rose 2.3% in the third quarter 2017 on a comparable
basis, and was +4.7% excluding the negative impact of roaming
regulation (-83 million euros). The adjusted EBITDA margin from
telecom activities was 35.4%, an improvement of 0.5 percentage
points compared with the third quarter of 2016.
-
Commercial momentum remained
strong. Orange France posted its best third quarter results since
2008, with 320,000 net additions in mobile contract
customers[1]. Among these, premium offers proved popular with
customers. Net additions of mobile contract customers1 in
France[2] and in the
Europe segment totalled 494,000 (including +320,000 for Orange
France), with the customer base up 3.2% at 30 September 2017.
Orange had 33.0 million users of 4G in France and in the Europe
segment at 30 September 2017, up 29% year on year.
The rapid expansion of fibre take-up continued in
France and the Europe segment with 321,000 net additions in the
third quarter. The fibre customer base reached 4.2 million at 30
September 2017, up 47% year on year.
Growth in convergent offers to consumers remained strong in France
and Europe, with 10.1 million customers at 30 September 2017
(+11.6% year on year).
In Africa & Middle East, the mobile customer base rose 5.2%
year on year, with 6.2 million net additions on a comparable
basis.
-
The Group's capital expenditure
(capex) for the first nine months of the year was 4.873 billion
euros, in line with the 2017 forecast of 7.2 billion euros.
Capex increased by 2.8% compared to the first nine months of 2016
on a comparable basis. Capex from telecom activities (4.836 billion
euros) rose 2.0% and the ratio of capex from telecom activities to
revenues was 15.8%. Investments in fibre and in very high-speed
mobile (4G and 4G+) rose 14.2% compared with the first nine months
of 2016.
2017 outlook
For the full year 2017, Orange confirms that it expects adjusted
EBITDA to be higher than that achieved in 2016 on a comparable
basis, buoyed by strong commercial momentum, supported by
investment, and continued effort on the transformation of the cost
structure.
The Group also confirms its target to maintain a ratio of net debt
to adjusted telecom EBITDA of around 2x in the medium term in order
to preserve Orange's financial strength and investment capacity.
The Group will maintain its policy of selective, value-creating
acquisitions, concentrating on markets in which it is already
present.
As announced at the presentation of the 2016 full year results, the
Board of Directors will propose to the Annual General Meeting of
shareholders in 2018 the payment of a dividend of 0.65 euros per
share for 2017. An interim dividend for 2017 of 0.25 euros per
share will be paid on 7 December 2017[3].
On the publication of the results for the first
nine months of 2017, Stéphane Richard, Chairman and CEO of the
Orange Group, commented:
"This quarter demonstrates very
good momentum at Orange, supported more than ever by investment in
customer experience and our networks. We attracted nearly half a
million mobile contract customers and 321,000 fibre customers in
France and the Europe segment in the past three months. Despite new
roaming regulation in Europe, we delivered revenue growth for the
ninth consecutive quarter and adjusted EBITDA growth of 2.1%.
Excluding regulatory changes, adjusted EBITDA rose
4.4%.
Orange France also confirmed its return to growth
and had a particularly strong third quarter in mobile, with 320,000
net additions - its best performance since 2008. It was the same
story in fibre, where 40% growth enabled us to reach more than 1.8
million customers. The continuing excellent performance in Spain
and Romania, along with the return to growth in Africa & the
Middle East, completed a positive picture for Orange as a whole
this quarter.
Finally, I am delighted that we will launch Orange
Bank next week. I can't wait for customers to benefit from this new
and unique offer.
These results have led us to confirm our outlook
for 2017. We will provide more detail of our ambitious strategy to
create value in the years ahead at an Investor Day on 7
December."
The Board of Directors of Orange SA
met on 25 October 2017 and examined the Group's results to 30
September 2017.
The financial data and comparable basis data in this press release
are unaudited.
More detailed information is available on the Orange website:
www.orange.com
Key figures
|
|
|
|
|
|
|
|
|
|
|
2017 |
2016 |
2016 |
|
change |
|
change |
In millions
of euros |
|
comparable basis |
historical basis |
|
comparable basis |
|
historical basis |
|
|
|
|
|
|
|
|
|
|
Revenues |
30,550 |
30,233 |
30,401 |
|
1.0 % |
|
0.5 % |
Of which: |
|
|
|
|
|
|
|
|
France |
13,408 |
13,380 |
13,380 |
|
0.2 % |
|
0.2 % |
|
Europe |
8,194 |
7,846 |
7,798 |
|
4.4
% |
|
5.1
% |
|
|
Spain |
3,999 |
3,707 |
3,706 |
|
7.9
% |
|
7.9
% |
|
|
Poland |
1,986 |
2,006 |
1,963 |
|
(1.0)% |
|
1.2
% |
|
|
Belgium
& Luxembourg |
934 |
920 |
920 |
|
1.5
% |
|
1.5
% |
|
|
Central
European countries |
1,290 |
1,220 |
1,215 |
|
5.8
% |
|
6.2
% |
|
|
Intra-Europe eliminations |
(14) |
(6) |
(6) |
|
- |
|
- |
|
Africa & Middle East |
3,756 |
3,676 |
3,887 |
|
2.2
% |
|
(3.4)% |
|
Enterprise |
5,393 |
5,463 |
5,466 |
|
(1.3)% |
|
(1.3)% |
|
International Carriers & Shared
Services |
1,234 |
1,357 |
1,360 |
|
(9.0)% |
|
(9.3)% |
|
Intra-Group eliminations |
(1,436) |
(1,489) |
(1,490) |
|
- |
|
- |
Adjusted EBITDA* |
9,599 |
9,397 |
9,510 |
|
2.2 % |
|
0.9 % |
of which telecom activities |
9,643 |
9,420 |
9,510 |
|
2.4
% |
|
1.4
% |
|
As % of revenues |
31.6 % |
31.2 % |
31.3 % |
|
0.4 pt |
|
0.3 pt |
of which
Orange Bank |
(44) |
(24) |
- |
|
- |
|
- |
CAPEX (excluding licences) |
4,873 |
4,739 |
4,733 |
|
2.8 % |
|
3.0 % |
of which telecom activities |
4,836 |
4,739 |
4,733 |
|
2.0
% |
|
2.2
% |
|
As % of revenues |
15.8 % |
15.7 % |
15.6 % |
|
0.2 pt |
|
0.3 pt |
of which
Orange Bank |
37 |
- |
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
|
|
|
third
quarter |
third
quarter |
third
quarter |
|
change comparable |
|
change historical |
|
|
|
2017 |
2016 |
2016 |
|
basis |
|
basis |
In millions
of euros |
|
comparable basis |
historical basis |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
10,274 |
10,179 |
10,323 |
|
0.9 % |
|
(0.5)% |
Of which : |
|
|
|
|
|
|
|
|
France |
4,529 |
4,519 |
4,519 |
|
0.2 % |
|
0.2 % |
|
Europe |
2,789 |
2,684 |
2,670 |
|
3.9
% |
|
4.5
% |
|
|
Spain |
1,371 |
1,288 |
1,288 |
|
6.4
% |
|
6.4
% |
|
|
Poland |
661 |
670 |
657 |
|
(1.3)% |
|
0.6
% |
|
|
Belgium
& Luxembourg |
316 |
311 |
311 |
|
1.7
% |
|
1.7
% |
|
|
Central
European countries |
447 |
418 |
417 |
|
6.9
% |
|
7.3
% |
|
|
Intra-Europe eliminations |
(6) |
(3) |
(3) |
|
- |
|
- |
|
Africa & Middle East |
1,264 |
1,226 |
1,371 |
|
3.1
% |
|
(7.8)% |
|
Enterprise |
1,778 |
1,788 |
1,800 |
|
(0.5)% |
|
(1.2)% |
|
International Carriers & Shared
Services |
415 |
454 |
456 |
|
(8.6)% |
|
(9.0)% |
|
Intra-Group eliminations |
(502) |
(493) |
(494) |
|
- |
|
- |
Adjusted EBITDA* |
3,622 |
3,548 |
3,597 |
|
2.1 % |
|
0.7 % |
of which telecom activities |
3,638 |
3,556 |
3,597 |
|
2.3
% |
|
1.1
% |
|
As % of revenues |
35.4 % |
34.9 % |
34.9 % |
|
0.5 pt |
|
0.6 pt |
of which
Orange Bank |
(17) |
(8) |
- |
|
- |
|
- |
CAPEX (excluding licenses) |
1,597 |
1,558 |
1,566 |
|
2.5 % |
|
2.0 % |
of which telecom activities |
1,586 |
1,558 |
1,566 |
|
1.7
% |
|
1.2
% |
|
As % of revenues |
15.4 % |
15.3 % |
15.2 % |
|
0.1 pt |
|
0.3 pt |
of which
Orange Bank |
12 |
- |
- |
|
- |
|
- |
* EBITDA adjustments are described in appendix
3.
Comments on key Group
figures
Revenues
Group revenues rose 1.0% (+317 million euros) on a
comparable basis[4] to 30.550
billion euros in the first nine months of the year. This was driven
by fixed broadband services and mobile services, up 6.3% and 0.6%
respectively compared with the first nine months of 2016.
In the third quarter of 2017, Group revenues grew 0.9% on a
comparable basis, in line with the first half (+1.1%). The impact
of the end of roaming charges in Europe was largely offset by
revenue growth from interconnection charges billed to operators in
other countries.
The third quarter 2017 revenue trends by region were as follows (on
a comparable basis):
In France, revenues grew for the second consecutive quarter (+0.2%,
compared with +0.5% in the second quarter). Growth remained
sustained in fixed broadband services, +4.8% in the third quarter
after 5.0% in the second quarter. Mobile services recorded a small
decline of 1.6% (after -1.1% in the second quarter), despite the
impact of new roaming regulation in Europe and the sharper decline
in national roaming during the quarter.
In the Europe segment, revenues grew 3.9% in the
third quarter of 2017, compared with +4.9% in the second
quarter:
-
in Spain, growth in mobile services remained
strong (+7.5% in the third quarter, unchanged from the second
quarter), while fixed broadband rose 8.3%, as in the second
quarter;
-
the trend is improving in Poland, with a small
decline of 1.3% in the third quarter following -2.2% in the second
quarter, boosted by high speed fixed broadband (up 6.6% after 2.2%
in the second quarter). Mobile services declined 7.1% in the third
quarter;
-
in Belgium & Luxembourg, revenues rose 1.7%
in the third quarter with growth in convergent offers, partially
offset by the decline in MVNOs;
-
Central European countries recorded revenue
growth of 6.9% in the third quarter, in line with the second
quarter (+7.1%), driven by growth in Romania (+10.4%) and Moldova
(+5.0%).
Africa & Middle East posted a 3.1% increase in
the third quarter, confirming the return to solid growth seen in
the second quarter (+2.7%), led by Sonatel group, Côte d'Ivoire
group and Morocco.
The revenue decline in the Enterprise segment was limited to 0.5%
in the third quarter, mainly boosted by strong mobile equipment
sales. The Cloud grew 37% during the quarter, while security
services saw a 17% increase.
Customer base growth
The number of mobile customers at Group level was
207.5 million at 30 September 2017, up 3.2% year on year (+6.4
million net additions) on a comparable basis. Contract customers
(73.2 million) rose 7.3% year on year.
In France[5], mobile
contract customers[6] performed
well, with 353,000 net additions during the quarter, driven by Open
convergent offers (mainly Play and Jet) and Sosh digital offers.
The rapid take-up of fibre continued, with 145,000 net additions in
the third quarter and 1.835 million customers at 30 September 2017
(+40.3% year on year).
In Spain, commercial momentum remained strong, with 147,000 net
additions of mobile contract customers in the third quarter of
2017, and with 137,000 net additions of fibre customers. Orange
Spain had 2.084 million fibre customers at 30 September
2017.
In Poland, there were 89,000 net additions of mobile contract
customers in the third quarter of 2017, with a contract customer
base of 9.662 million at 30 September 2017 (+7.9% year on
year).
In Belgium & Luxembourg, the mobile contract
customer[7] base grew
2.3% year on year, with 18,000 net additions in the third quarter
and a total of 2.389 million customers7 at 30 September
2017.
The Africa & Middle East segment had 126.7 million mobile
customers at 30 September 2017, a year on year increase of 5.2% on
a comparable basis (+6.2 million customers). Orange Money had 34.6
million customers at 30 September 2017, of which 10.7 million were
active customers.
The group's fixed broadband customers increased to 19.3 million at
30 September 2017, up 5.2% year on year. In particular, the number
of fibre customers in France and the Europe segment (4.2 million
customers at 30 September) rose 47%.
Consumer convergent offers accounted for 10.1 million customers in
France and the Europe segment (+11.6% year on year), driven
primarily by France (5.9 million), followed by Spain (3.1 million)
and Poland (945,000). The Belgium & Luxembourg segment as well
as Romania and Slovakia are also marketing convergent
offers.
TV services had 8.9 million customers at 30 September 2017, a year
on year increase of 8.8%.
Adjusted EBITDA
The Group's adjusted EBITDA was 9.599 billion
euros in the first nine months of 2017, a 2.2% increase (+203
million euros) on a comparable basis. Adjusted EBITDA from telecom
activities was 9.643 billion euros at 30 September 2017, an
increase of 2.4% (+222 million euros) on a comparable basis. The
adjusted EBITDA margin for telecom activities was 31.6%, an
increase of 0.4 percentage points compared with the first nine
months of 2016.
In the third quarter of 2017, adjusted EBITDA from telecom
activities was 3.638 billion euros, an increase of 2.3%. The
adjusted EBITDA margin for telecom activities was 35.4%, up 0.5
percentage points compared with the third quarter of
2016.
The increase in adjusted EBITDA from telecom activities in the
third quarter of 2017 (82 million euros on a comparable basis) was
due to revenue growth (95 million euros), while operating costs saw
a limited increase (13 million euros). The fall in certain other
operating costs (interconnection charges, other networks and IT
expenses, general and administrative expenses, operating taxes and
levies) and the fall in personnel expenses, largely offset the
increase in content costs and the purchase of client
equipment.
In the first nine months of the year, personnel expenses for the
Group declined 2.7% on a comparable basis, reflecting the lower
average number of full-time equivalent employees during the period
(also -2.7%).
CAPEX
Group CAPEX rose 2.8% on a comparable basis to
4.873 billion euros in the first nine months of 2017. CAPEX from
telecom activities (4.836 billion euros) rose 2.0% and the ratio of
CAPEX from telecom activities to revenues was 15.8% (+0.2
percentage points compared with 30 September 2016).
Investments in fibre increased 6% on a comparable basis, most
notably in France, Spain and Poland. A total of 24.6 million
households had very high-speed broadband connectivity across the
Group's footprint at 30 September 2017 (+46% year on year), of
which 11.3 million were in Spain, 8.4 million in France, 2.3
million in Romania (following the cross-network-sharing agreement
with Telekom Romania) and 2.2 million in Poland.
The sharp increase in investment in very high-speed mobile services
(+43%) was mainly due to the accelerated rollout in the Africa
& Middle East segment and in France. At 30 September 2017, 4G
covered 93.8% of the population in France, 94.6% in Spain, 99.8% in
Poland, 99.6% in Belgium, 90.9% in Romania, 83% in Slovakia, and
98% in Moldova. In France and Spain, investments focused on
improving service quality in public spaces and on public transport.
4G+ deployment also continued in France and in the other European
countries.
In the Africa & Middle East segment, the increase in investment
was mainly due to further deployment of 4G, particularly in
Morocco, Egypt, Côte d'Ivoire and Senegal.
Investment in customer equipment remained stable as the development
of convergent offers for cable in Belgium was offset by optimising
the costs of Livebox and set-top boxes in France.
The store modernisation programme continued. At 30
September 2017, the Group had 260 stores based on the new Smart
Store concept, with 96 in France, 134 in other European countries,
and 30 in Africa & the Middle East.
Within IT systems, the necessary investments for the launch of
Orange Bank was offset by a more selective approach in France and
in Africa and the Middle East.
Review by operating segment
France
In France, revenues grew for the
second consecutive quarter (+0.2% in the third quarter of 2017,
following +0.5% in the second quarter). The slowdown between the
two quarters was mainly due to mobile equipment sales, where the
steady growth to date levelled off in the third quarter, while
growth in services (led by fixed services) gathered pace.
Mobile services fell 1.6% in the
third quarter of 2017, after a decline of 1.1% in the second
quarter. The impact of the end of roaming charges in Europe was
mostly offset by revenue growth from interconnection charges billed
to operators in other countries. In addition, the contract customer
base[8] grew, with
320,000 net additions during the quarter (almost double that of the
third quarter of 2016), driven by convergent offers (including Play
and Jet) and Sosh digital offers. Overall, the contract customer
base8 was 18.6
million customers at 30 September 2017 (up +3.4% year on year). The
number of SIM cards associated with consumer convergent offers
stood at 9.0 million at the same date (+12.2% year on year). At 30
September 2017, 69% of consumer contracts included 4G (+12
percentage points year on year), and SIM-only offers accounted for
73% of consumer contracts (+11 percentage points year on year).
Fixed services rose 1.9% in the third
quarter of 2017 after climbing 1.1% in the second quarter. Fixed
broadband services continued to grow steadily (+4.8% in the third
quarter after rising 5.0% in the second quarter), led by increases
in both customer base and ARPU. The fixed broadband customer base
had 11.1 million subscribers at 30 September 2017 (+3.2% year on
year). This included 1.8 million fibre subscribers, an increase of
40.3% year on year. The quarterly ARPU of fixed broadband rose 1.4%
in the third quarter of 2017, reflecting, in particular, the
growing weight of fibre. Consumer convergent offers (5.9 million
customers at 30 September 2017, a year on year increase of 9.2%)
represented 58.6% of the consumer fixed broadband customer base
(+3.0 percentage points in one year).
Fixed services to carriers and other fixed revenues increased 5.0%
in the third quarter of 2017, compared with +2.5% in the second
quarter, mainly due to fibre co-financing and unbundling. The
continued decline of traditional telephony reached 10.7% in the
third quarter.
Europe
Revenues in the Europe segment grew
3.9% in the third quarter of 2017 after rising 4.9% in the second
quarter on a comparable basis. The slowdown in growth between the
two quarters was mainly due to a slowdown in growth of mobile
equipment sales (+12.8% in the third quarter, compared with +17.6%
in the 2nd
quarter).
Mobile services rose 2.3% in the third quarter of 2017 after rising
2.7% in the second quarter on a comparable basis. The impact of the
end of roaming charges in Europe was mostly offset by revenue
growth from interconnection charges billed to operators in other
countries. Commercial activity in customer contracts remained very
strong, with 351,000 net additions in the third quarter of 2017.
The contract customer base was 34.2 million at 30 September 2017,
an increase of 5.1% year on year, representing 69.6% of the total
mobile customer base at that date (+5.9 percentage points year on
year).
Revenue growth from fixed broadband accelerated, reaching 10.0% in
the third quarter of 2017 on a comparable basis after +8.9% in the
second quarter. This was due to rapid growth of fibre in Spain, the
development of convergent offers in Belgium, and the improved trend
in Poland. The fixed broadband customer base in the Europe segment
was 7.0 million customers at 30 September 2017, a year on year
increase of 8.9%.
Consumer convergent offers in the Europe segment totalled 4.2
million customers at 30 September 2017 (+15.0% year on year) with
109,000 net sales in the third quarter of 2017, mainly in Poland,
Belgium and Romania.
Spain
In Spain, revenues grew 6.4% in the
third quarter of 2017, after 8.8% in the second quarter. Mobile
services and fixed broadband continued to grow steadily, matching
the pace of the second quarter. The slowdown in growth in the third
quarter was mainly due to the reduction in fixed services to
international carriers. Revenues from customer convergent offers
rose 11.8% in the third quarter of 2017, with 3.1 million customers
at 30 September 2017 (+3.5% year on year). This equates to 82.8% of
the consumer fixed broadband customer base at that date (+1.5
percentage points year on year).
Mobile service revenues increased 7.5% in the third quarter of
2017, identical to the growth in the second quarter. Revenues were
boosted by ongoing enrichment of offers, the rollout of 4G (9.0
million users at 30 September 2017, +25% year on year) and the
expansion of the contract customer base (+4.7% year on year, with
12.944 million customers at 30 September 2017). Growth in mobile
services to other carriers was also significant, with higher
revenue growth from visitors roaming, MVNOs and network sharing in
the third quarter.
Revenue growth from fixed broadband remained buoyant (+8.3% in the
third quarter, identical to that of the second quarter). Fixed
broadband had 4.2 million customers at 30 September 2017 (+2.4%
year on year) and ARPU rose 4.5%. Fibre continued its steady
performance, with 137,000 net additions for the quarter. At 30
September 2017, fibre had 2.1 million customers (+47.7% year on
year) and accounted for 50.0% of the fixed broadband customer base
(+15.3 percentage points year on year). This was driven by the
rapid expansion of the fibre network, which covered 11.3 million
households at 30 September 2017 (+2.3 million year on year). TV
services also grew rapidly, with 593,000 customers (+29.6% year on
year).
Poland
Poland saw an improvement in its
revenue trajectory, with a small decline of 1.3% in the third
quarter of 2017 after -2.2% in the second quarter.
Consumer convergent offers continued to grow steadily, with 87,000
net additions in the third quarter of 2017, driven by the success
of the Orange Love offers. A total of 945,000 customers subscribed
to consumer convergent offers at 30 September 2017, a year on year
increase of +56.7%.
Mobile services fell 7.1% in the third quarter of 2017, compared
with -6.0% in the second quarter. The slowdown between the two
quarters is a direct result of the impact of European roaming.
Mobile service revenues continued to be affected by the development
of instalment payments and SIM-only offers. The contract customer
base recorded 89,000 net additions in the third quarter, partially
reflecting the simplification and enrichment of offers in
September. Contract customers totalled 9.7 million at 30 September
2017, a year on year increase of 7.9%. At the same date, 4G had 5.4
million users (+41% year on year).
The improving trend in fixed services (-1.7% in the third quarter
of 2017 after declining 4.3% in the second quarter) reflected the
change in fixed broadband, where revenues rose 6.6% in the third
quarter of 2017, compared with 2.2% in the second
quarter.
The fixed broadband customer base (2.4 million customers at 30
September 2017) increased 10.4% year on year, led by the rapid
development of fixed 4G, fibre and VDSL. At 30 September 2017,
these growth technologies represented 42% of the fixed broadband
customer base, compared with 26% a year earlier, while TV services
had 814,000 customers.
At the same time, carrier services were up 2.1% in the third
quarter of 2017, driven by international services. The decline in
traditional telephony was 13.3%.
Belgium & Luxembourg
Revenues from Belgium and Luxembourg
rose 1.7% in the third quarter of 2017, compared with 3.5% in the
second quarter. The slowdown between the two quarters reflected
mobile service revenues (+0.6% in the third quarter of 2017,
following +3.5% in the second quarter), impacted by the decline in
MVNO revenues as the Lycamobile contract came to an end in
July.
Excluding MVNOs, the growth in mobile services improved. In
Belgium, there were 15,000 net additions[9] in the
third quarter, and ARPU rose 2.7%. The contract customer
base9 in Belgium
and Luxembourg (2.389 million customers at 30 September 2017) grew
2.3% year on year, while 4G had 1.7 million users at 30 September
2017, a year on year increase of 24%. In addition, mobile equipment
sales for the third quarter, up 4.4%, rose in line with the second
quarter.
Fixed service revenues rose 27.7% in the third quarter of 2017,
compared with 15.7% in the second quarter. This was driven by the
success of the new Love convergent offers (mobile, internet + TV)
in a highly competitive market. Consumer convergent offers reached
75,000 customers at 30 September 2017, compared with 18,000 a year
earlier.
Central European
countries
Revenues from Central European
countries rose 6.9% in the third quarter of 2017, compared with
7.1% in the second quarter on a comparable basis.
In Romania, revenues rose 10.4% in the third quarter, following an
increase of 11.0% in the second quarter. Mobile equipment sales
continued to be robust for the second consecutive quarter. Mobile
service revenues rose 5.0% (after 4.6% in the second quarter),
driven by a sharp increase in visitor roaming and the continued
growth in incoming traffic.
In Slovakia, revenues rose 0.4% in the third quarter of 2017, after
an increase of 0.1% in the second quarter. The outlook for fixed
services (carrier services) has improved. Mobile equipment sales
remained steady, while mobile service revenues fell 1.5% in the
third quarter.
In Moldova, revenues rose 5.0% in the third quarter of 2017,
compared with +4.4% in the second quarter. This was driven by
mobile equipment sales and fixed broadband, while mobile services
continue to be impacted by the fall in international
traffic.
The Central European countries had a mobile customer base of 15.0
million customers at 30 September 2017, 8.3 million of them on
contracts, while the 4G mobile base (4.2 million users) grew
significantly (+48% year on year). Fixed broadband in Central
European countries had a total of 357,000 customers at 30 September
2017. Consumer convergent offers (Romania and Slovakia) had a total
of 93,000 customers.
Africa & Middle East
With an increase of 3.1% in the third
quarter of 2017, improved revenue in Africa and the Middle East
confirmed the return to solid growth that began in the second
quarter (+2.7%). Revenue growth in the third quarter was driven by
Sonatel Group[10] (primarily
in Mali and Guinea), the Côte d'Ivoire Group[11]
(primarily Burkina Faso) and Morocco. Egypt, the Democratic
Republic of Congo and Cameroon also recorded an improved trend in
terms of commercial momentum and revenues.
The growth in mobile data services remained strong at +38% in the
third quarter of 2017. 4G, which is available in 11
countries[12], had 10
million customers at 30 September 2017. Orange Money, which had
34.6 million customers at 30 September 2017 (including 10.9 million
active customers), also registered strong revenue growth (+60% in
the third quarter 2017).
The mobile customer base in Africa and the Middle East was 126.7
million at 30 September 2017, an increase of 5.2% (+6.2 million
customers) year on year on a comparable basis.
Enterprise
Revenues from the Enterprise segment
fell 0.5% in the third quarter of 2017, after -1.3% in the second
quarter on a comparable basis. The improving trend in the third
quarter was due to the mobile business (+10.7% after -0.2% in the
second quarter), which recorded a high level of equipment sales.
Mobile services returned a strong commercial performance in the
third quarter, with 32,000 customer contract[13] net
additions in France. However, mobile services revenues were
impacted by the end of roaming charges in Europe.
IT and integration services grew 0.8%
in the third quarter of 2017, after climbing 3.3% in the second
quarter. Strong growth in Cloud services continued (+37%), while
security services rose 17% and Applications[14] were
up 5.5%.
There was a 3.4% decline in voice
services in the third quarter of 2017, compared with -3.8% in the
second quarter. The growth of voice over IP services partly offset
the decline in traditional fixed telephony and customer
relationship services (contact number services).
Data services recorded a fall of 3.8%
in the third quarter of 2017, in line with the trend of the
previous three quarters. This was linked to the non-renewal of
various contracts (connectivity and broadcasting). There were
352,000 IPVPN subscribers at 30 September 2017 (+0.8% year on
year).
International Carriers &
Shared Services
Revenues from the International Carriers &
Shared Services segment fell 8.6% in the third quarter of 2017 on a
comparable basis, mainly due to the downturn in services to
international carriers.
Schedule of upcoming
events
Contacts
press: +33
(0)1 44 44 93 93
Jean-Bernard Orsoni
jeanbernard.orsoni@orange.com
Tom Wright
tom.wright@orange.com
Olivier Emberger
olivier.emberger@orange.com
|
financial communications: +33 (0)1 44 44 04 32
(analysts and investors)
Patrice Lambert-de Diesbach
p.lambert@orange.com
Luca Gaballo
luca.gaballo@orange.com
Anna Vanova
anna.vanova@orange.com
Samuel Castelo
samuel.castelo@orange.com
Didier Kohn
didier.kohn@orange.com |
individual shareholders: 1010 |
Disclaimer
This press release contains
forward-looking statements about Orange. Although we believe these
statements are based on reasonable assumptions, they are subject to
numerous risks and uncertainties, including matters not yet known
to us or not currently considered material by us, and there can be
no assurance that anticipated events will occur or that the
objectives set out will actually be achieved. Important factors
that could cause actual results to differ from the results
anticipated in the forward-looking statements include, among
others: the success of Orange's strategy, particularly its ability
to maintain control over customer relations when facing competition
with OTT players, risks related to banking activities, loss or
disclosure to third parties of customers' data, Orange's ability to
withstand intense competition in mature markets, networks or
software failures due to cyberattacks, damage to networks caused by
natural disasters, terrorist acts or other reasons, various frauds
affecting Orange or its customers, Orange's ability to retain the
necessary skills given the high level of employee retirements and
the development of new needs, difficulties in integrating newly
acquired businesses as part of the telecommunication sector's
consolidation in Europe, its ability to capture growth
opportunities in emerging markets and the risks specific to those
markets, possible adverse health effects associated with the use of
telecommunications equipment, risks related to the single brand
strategy, the eruption of a global financial or economic crisis,
fiscal and regulatory constraints and changes, the results of
litigation regarding regulations, competition and other matters,
disagreements with its co-shareholders in companies that Orange
does not control, the terms of access to capital markets, interest
rate or exchange rate fluctuations, Orange's credit ratings,
changes in assumptions underlying the accounting value of certain
assets resulting in their impairment, and credit risks or
counterparty risks on financial transactions. More detailed
information on the potential risks that could affect our financial
results is included in the Registration Document filed on 6 April
2017 with the French Autorité des Marchés
Financiers (AMF) and in the annual report on Form 20-F filed on
7 April 2017 with the U.S. Securities and Exchange Commission.
Forward-looking statements speak only as of the date they are made.
Other than as required by law, Orange does not undertake any
obligation to update them in light of new information or future
developments.
Orange Q3 results
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Orange via Globenewswire
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