Orange Sa · EURONEXT:ORA
Orange Sa — France Telecom — Q3 2006 Earnings Presentation
32 slides from Orange Sa's earnings presentation, Oct 26, 2006
Slide 1: Form 6-K France Telecom
SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 OF THE SECURITIES EXCHANGE ACT OF 1934 October 26, 2006 Commission File No. 1-14712 FRANCE TELECOM (Translation of registrant’s name into English) 6, place d’Alleray, 7
Slide 2: 3Q 2006 - October 26, 2006
M france telecom 3Q 2006 October 26"", 2006 orange
Slide 3: Cautionary statement
Cautionary statement • This presentation contains forward-looking statements and information on France Telecom's objectives, notably for 2006. Although France Telecom believes that these statements are based on reasonable assumptions, these forward-looking statements are subject to numerous risks an
Slide 4: 3Q06: Key figures in line with full year guidance
3Q06: Key figures in line with full year guidance % change 3Q06 % change Comparable 3Q06 vs 3Q05 9M06 9m06 vs 9m05 Euro millions / Excluding Pages Jaunes * Basis – 3Q05 Comp. Actual Basis Comp. Basis Revenues 12,915 13,070 8.9% 1.2% 38,441 1.2% Gross Operating Margin 5,061 4,884 3.5% -3.5% 14,141 -4
Slide 5: 3Q06: Major operational achievements
3Q06: Major operational achievements Positive impact of rebranding and new offers on French ADSL positions: 50.3%* retail ADSL market share at the end of September 53% Livebox penetration on ADSL customer base Mature Markets In France, positive impact of MVNO strategy and of Orange customers base gr
Slide 6: Key milestones
Key milestones Unik: unlimited mobile at home 10€/month for unlimited calls towards Fixed line in France Launch of 22€/month for unlimited calls towards Fixed line in France and Orange mobiles our first Mobile & connected: next-generation multiplay “Autumn Includes naked ADSL access, IP&mobile TV an
Slide 7: 3Q06: Group revenues by segment
3Q06: Group revenues by segment Excluding Pages Jaunes * Euro millions +340 13 ,070 +933 12,915 12,264 11,999 -11 -103 -71 -17 + 5.0% -1.8% - 3.7% Of which: Amena: EUR853m 3Q 05 3Q 05 ( excl. Forex Perimeter 3Q 05 on a Personal Home Enterprise Eliminations 3Q 06 Reported PJ) Impact Impact comparable
Slide 8: 3Q06: Group revenues by main markets
3Q06: Group revenues by main markets 3Q05 – 3Q06 revenues growth analysis Revenue breakdown by main markets Euro millions 13,070 12,915 +264 Growing markets -109 12% -0.9%* +19.3%* Mature markets 88% Group revenues Mature markets Growing markets Group revenues 3Q05 CB 3Q06 Growing markets’ share of
Slide 9: Personal 3Q06
Personal 3Q06 €7,146m / +20.4% actual / +5.0% on a comparable basis 3Q05 - 3Q06 revenues analysis + 220 7,146* Euro millions + 87 + 871 + 29 + 22 6,806 -2 -9 5,937 +1.2% -0.6% +2.6% +20.5% +13.9% 3Q05 actual Forex Impact Perimeter 3Q05 on a Personal Personal UK Personal Spain Personal Personal ROW 3
Slide 10: Personal 3Q06 KPI's
Personal 3Q06 KPI’s Total Group broadband Total Group mobile customers* mobile customers (000) +15.4%** 92.6m 3,896 72.6m +5.9%** 55.0m +150% in 50.4m 9 months 2,924 Western European countries 2,244 1,566 +23.1%** Eastern Europe 22.6m 653 +51.4%** 15.2m 15.0m 319 Africa, Middle-East, other emerging
Slide 11: 3Q06 revenues: Personal France
3Q06 revenues: Personal France €2,529m / +1.0% actual / +1.2% on a comparable basis 3Q05 - 3Q06 revenues analysis Euro millions + 91 2,529 + 25 + 17 2,500 - 100 -3 3Q 05 on a Customer base CTR Impact Voice revenues* Non-Voice Equipments & 3Q 06 comparable basis Impact Revenues others Customer base:
Slide 12: 3Q06 revenues: Personal UK
3Q06 revenues: Personal UK €1,491m / -0.1% actual / -0.6% on a comparable basis 3Q05 - 3Q06 revenues analysis Euro millions 1,492 1,499 + 50 1,491 +8 -51 0 -8 3Q05 actual Forex Impact 3Q05 on a Customer Base Voice revenues Non-voice Equipment & 3Q06 comparable Impact revenues others basis 15.14m cus
Slide 13: 3Q06 revenues: Personal Spain
3Q06 revenues: Personal Spain €882m / +2.6% on a comparable basis 3Q05 - 3Q06 revenues analysis Euro millions + 80 +5 882 859 -39 0 -24 3Q 05 on a Customer Base CTR Impact Voice Revenues* Non-voice revenues Equipment & others 3Q 06 comparable basis Impact 10.8m customers, +10.3% yoy on a comparable
Slide 14: 3Q06 revenues: Personal Poland & ROW
3Q06 revenues: Personal Poland & ROW 3Q05 Actual Comparable Euro millions actual 3Q06 changes basis changes Poland Total Number of customers (000) 9,134 11,738 +28.5% +28.5% Total revenues (EURm) 415 510 +22.7% +20.5% ROW Total Number of customers (000) 24,695 32,341 +31% +29% Total revenues (EURm)
Slide 15: 3Q06 revenues: Home
3Q06 revenues: Home €5,620m / +0.2% actual / -1.8% on a comparable basis 3Q05 - 3Q06 revenues analysis Euro millions +105 5,723 +8 +1 5,620* 5,610 + 27 - 43 - 49 - 29 -1.0% -6.2% +0.6% -17.8% + 10.4% 3Q05 actual Forex impact Perimeter 3Q05 on a Home France Home Poland Home UK Home Spain Other Home 3
Slide 16: Broadband Internet customers
Broadband Internet customers Broadband Internet customers in Europe (000) ADSL customers in France (000) +55% in 18 5,536 months 5,216 9,210 4,926 4,457 3,996 3,431 3,661 5,951 2,931 2,515 2,131 1,559 3,468 990 416 627 489 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 1Q05 3Q06 12% 53% of which Livebox of whic
Slide 17: Home France 3Q06 KPI's
Home France 3Q06 KPI’s ADSL market share stabilised Resilience of total number of fixed lines (m) 50.2% 50.0% 49.8% 49.8% 50.3% 27.41 27.50 27.57 27.53 27.51 0.34 0.57 0.92 1.21 1.55 59.6% 59.1% 48.3% 48.1% 50.6% 27.07 26.93 26.65 26.32 25.95 3Q05 4Q05 1Q06 2Q06 3Q06 3Q05 4Q05 1Q06 2Q06 3Q06 Number
Slide 18: Home France 3Q06
Home France 3Q06 +0.1% actual / -1.0% on a comparable basis 3Q05 - 3Q06 revenues analysis Euro millions + 48 4,446 4,403 4,398 +7 -11 - 40 2,408m€ 1,539m€ 456m€ 3Q05 actual Perimeter Impact 3Q05 on a comparable Consumer services Carrier Services Other Home rev in Fr 3Q06 basis Total retail and whole
Slide 19: Home France consumer services 3Q06
Home France consumer services 3Q06 -0.3% actual / -0.4% on a comparable basis 3Q05 - 3Q06 revenues analysis Euro millions +40 2,418 +51 2,408 +100 -27 -29 -27 -33 -86 3Q 05 Chges in nber of Subscription fee CTR Impact PSTN volume and Broadband VoIP Narrowband Others consumer 3Q 06 retail subscribers
Slide 20: Home ROW 3Q06 revenues - Spain
Home ROW 3Q 06 revenues - Spain €135m / -16.2% actual /-17.8% on a comparable basis ADSL customer base of 593k, +12.3% yoy Customer base A customer base increasingly broadband, multiplay and subscription based Market standard in Spain moving to ADSL including PSTN voice bundles, with a strong pressu
Slide 21: Home ROW 3Q06 revenues - UK
Home ROW 3Q 06 revenues - UK €107m / +1.2% actual /+0.6% on a comparable basis ADSL customer base of 1,029k, +24.6% yoy Customer base A Leadership confirmed on VoIP Customer base at 243k at the end of September Range of product refreshed to increase customer benefit Deployment of (from free broadban
Slide 22: 3Q06 revenues: Enterprise
3Q06 revenues: Enterprise €1,852m / -1.4% actual / -3.7% on a comparable basis 3Q05 - 3Q06 revenues analysis Euro millions +68 1 ,924 1 ,879 -10 +30 1 ,852 +49 -23 -9 -132 3Q 05 Actual Forex Impact Perimeter Impact 3Q 05 on a CTR Impact Business Advanced Extended Others 3Q 06 comparable basis Networ
Slide 23: 3Q06: Gross Operating Margin
3Q06: Gross Operating Margin Excluding Pages Jaunes * Comparable Euro millions Actual 3Q05 Basis –3Q05 3Q06 9M06 Revenues 11,999 12,915 13,070 38,441 non labour expenses 5,281 5,822 6,165 17,892 as a % of revenues 44.0% 45.1% 47.2% 46.5% of which commercial expenses 1,438 1,690 1,958 5,499 as a % of
Slide 24: 3Q06: Headcounts and labour costs
3Q06: Headcounts and labour costs Headcounts, end of period Labour costs, euro millions 2,220 2,166 194,830 199,796 198,185 194,254 2,021 0,9% -0,5% -3,1% Sept 05 Sept 05 CB Dec 05 Sept 06 T106 T206 T306 Labour costs % change comparable basis yoy Labour costs down 1.0% on a 9 months comparable basis
Slide 25: 3Q06: Commercial expenses
3Q06: Commercial expenses Euro millions 1 ,958 1 ,810 1, 731 15.9% 8.7% 4.4% 1Q06 2Q06 3Q06 commercial expenses % change comp. Basis YoY Monitor proactively commercial expenses in order to: Stick with each local market situation Invest in high value customer base 24
Slide 26: 3Q06: Capex
3Q06: Capex €1,520m / -1.9% on a comparable basis 9m06 Capex by key items Euro millions 9M06 Capex by key items % change Comparable Livebox, 9M06 Basis – 9M06 set-top boxes and Mobile Livebox, Set Top boxes +24.2% others network & others 789 17% 39% IT&Custom IT& Customer service +6.0% ers' 1,076 pl
Slide 27: Full Year 2006 trends confirmed
Full Year 2006 trends confirmed In maturing and highly competitive markets, manage a balance between market share and profitability through dynamic cost optimization and driven opex and capex allocation In growing markets, continue to fuel the strong profitable growth with the right level of resourc
Slide 28: 3Q 2006 - October 26, 2006
M france telecom 3Q 2006 October 26"", 2006 orange
Slide 29: Glossary (1)
Glossary (1) ARPU – Consumer Fixed Services (HCS segment): average annual revenue per line for the Consumer Fixed Services is calculated by dividing the average monthly revenues on the basis of the last twelve months by the weighted average number of customers over the same period. The weighted aver
Slide 30: Glossary (2)
Glossary (2) French Retail ADSL Market Share (ARCEP definition): starting from 1Q06, quarterly French ADSL market share presentation will be based on ARCEP High- speed Internet Observatory methodology. Until the end of 2005, the figures published by France Telecom covered intermediate markets (such
Slide 31: Glossary (3)
Glossary (3) Non labour expenses: operating expenses excluding labour expenses. Operating expenses excluding labour expenses included in the calculation of GOM, include external purchases and other operating expenses (net of other operating income). Non labour expenses are net of capitalized costs.
Slide 32: Signature
SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. FRANCE TELECOM Date: October 26, 2006 By: /S/ PIERRE HILAIRE Name: Pierre Hilaire Title: Director of Fin