Orange Belgium Sa · EURONEXT:OBEL
Orange Belgium Sa — Q3 2019 Earnings Presentation
24 slides from Orange Belgium Sa's earnings presentation, Oct 23, 2019
Slide 1: Orange Belgium Q3 2019 Financial Results
Orange Belgium Q3 2019 Financial Results October 23, 2019
Slide 2: Disclaimer
Disclaimer This presentation might contain forward-looking statements about Orange Belgium in particular for 2019. 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 co
Slide 3: Section one: Q3 2019 Highlights
Section one Q3 2019 Highlights 3
Slide 4: Q3 2019 Key achievements
Q3 2019 Key achievements Mobile contract excl. M2M Convergent customers Net additions 14.6% 2.5 m 233 k Mobile contract excl. + 32 k of total postpaid mobile +5.8% yoy +50.3% yoy M2M base is convergent Convergent customer + 17 k Belgium Belgium Belgium Belgium Revenues Retail service revenues EBITDA
Slide 5: Section two: Operational Results
Section two Operational Results 5
Slide 6: Convergence: continued success with 17k new Love customers
Convergence: continued success with 17k new Love customers 18 21 19 19 25 20 17 14 16 Love (‘000) 233 200 216 180 155 122 136 103 Love customer net adds, 82 +17k 9.7% yoy Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Love customers yoy 50.3% Convergent mobile variation 33 3
Slide 7: Mobile postpaid: Commercial momentum remains solid in Q3'19
Mobile postpaid: Commercial momentum remains solid in Q3’19 despite competition’s high promotional activity +5.8% Customer base (‘000) 2,408 2,469 2,490 2,516 2,548 210 244 272 294 319 2,197 2,225 2,218 2,222 2,229 Contract customers / 82% total base (Q3’18: 81%) Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2
Slide 8: Mobile prepaid: good performance in a declining segment
Mobile prepaid: Orange Belgium maintains a good performance in a declining segment -4.2% -6 Customer base (‘000) 2 + Net adds (‘000) -4 -4 -6 577 567 561 557 553 -10 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 8
Slide 9: Mobile: Unlimited plans catalyst for data usage growth in Belgium
Mobile: Unlimited plans catalyst for data usage growth in Belgium +42% +79% Average mobile data Average mobile data usage (GB) +35% +55% 3.2 3.3 4.2 4.2 GB usage (smartphone), +120% +57% 2.5 2.9 +42% yoy 2.3 1.8 1.3 1.3 0.3 0.9 0.9 0.3 0.6 0.5 Mobile data active 0.1 EoP 2013 EoP 2014 EoP 2015 EoP 20
Slide 10: B2C convergent ARPO continued to grow while mobile-only postpaid ARPO contracted
B2C convergent ARPO continued to grow while mobile-only postpaid ARPO contracted Quarterly B2C convergent ARPO (€) Quarterly mobile only ARPO (€) + 7.0% + 7.7% -0.6% -1.1% + 5.4% + 4.1% -1.8% + 1.3% -3.2% -2.6% 21.8 20.8 20.8 20.6 21.2 76.7 75.5 77.4 76.8 77.7 7.5 7.1 6.6 7.1 6.7 7.5 7.1 6.6 7.1 6.7
Slide 11: Regulatory update
Regulatory update Cable Regulation Spectrum and 5G auction Key service aspects of 2018 decisions implemented The Royal Decrees regarding the allocation of the 700, 1400 and 3400-3800 MHz band and the Single installer started in Q3’19 renewal/reallocation conditions of the 900, 1800 and Broadba
Slide 12: Section three: Financial Results
Section three Financial Results 12
Slide 13: Mobile only service revenues: slight decrease
Mobile only service revenues: slight decrease mainly explained by the lower mobile only ARPO (-2.6%) offset by a higher customer base (+0.5%) Mobile only service revenues (€ m) + 1.5% + 0.7% + 3.0% + 0.1% -2.2% 158.8 154.4 154.4 153.3 155.4 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Mobile only service
Slide 14: Convergent service revenues: sustained growth
Convergent service revenues: sustained growth + 112.3% + 94.6% Convergent service revenues (€ m) + 83.4% + 69.9% + 54.2% 41.0 44.3 38.1 32.7 28.7 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Convergent service revenues yoy 14
Slide 15: Retail service revenues: another quarter of solid growth
Retail service revenues: another quarter of solid growth + 10.1% + 9.8% + 13.5% + 9.6% + 7.1% Retail service revenues (€ m) 207.0 207.0 221.8 199.3 205.7 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Retail service revenues yoy 15
Slide 16: Orange Belgium Group: Q3 2019 key financial results
Orange Belgium Group: Q3 2019 key financial results 1,287.7 290.3 179.5 342.2 77.4 971.4 220.5 69.0 EBITDAaL (€ m) Revenues (€ m) eCAPEX (€ m) 119.1 326.0 334.3 +2.5% 83.6 +1.1% 82.7 39.3 +18.2% 33.2 313.0 318.9 +1.9% +18.2% -5.6% 69.9 78.9 42.9 45.5 306.6 318.2 +3.8% -3.8% +16.1% 60.3 58.0 31.8 36.
Slide 17: Revenues driven by increase in retail service revenues and equipment sales
Revenues driven by increase in retail service revenues and equipment sales, despite lower MVNO revenues Revenues evolution (€ m) +2.5% + 14.8 Convergent service -4.6 + 15.6 revenues 334.3 -5.3 MVNO + 3.4 -9.9 + Fixed & IT service 326.0 + 2.6 revenues -3.4 Mobile service + revenues + 7.9 318.0 Q3 201
Slide 18: EBITDAaL increased thanks to higher retail service revenues and efficiencies
EBITDAaL increased thanks to higher retail service revenues, sustained efficiencies as well as continuous improvements in the cable operations EBITDAaL evolution (€ m) +1.1% -3.2 -0.1 + 8.3 + + -4.0 83.6 82.7 81.4 + 1.3 Q3 2018 BKM + IFRS 16 Q3 2018 Revenues Direct Labor Indirect Q3 2019 Reported Ad
Slide 19: Network and IT spend brought forward to Q3'19
Network and IT spend brought forward to Q3’19 and will have no impact on full-year eCapex eCapex (€ m) Net debt +7.8% €248.4 m 12.3% 11.7% 119.1 Net debt/EBITDAaL 110.5 31.4 30.2 0.9x 88.9 79.1 9M 2018 9M 2019 Cable capex incl. CPE, IT & Network, etc. Core capex Total capex to total revenues ratio 1
Slide 20: Cable operations continue to improve in YTD
Cable operations continue to improve in YTD 19 Variations Revenues: €77.4 m +77% EBITDAaL: €3.5 m +€18.5 m eCapex: €30.2 m -4% Operating cash flow: - €26.7 m +€19.6 m 20
Slide 21: Section four: 2019 guidance
Section four 2019 guidance 21
Slide 22: 2019 guidance
2019 guidance 2019 Guidance Q1’19 Q2’19 H1’19 Q3’19 9M’19 Revenues Slight growth vs. +3.8% +1.9% +2.8% +2.5% +2.7% growth 2018 EBITDAaL €285-305 m €58.0m €78.9m €136.9m €83.6m €220.5m eCapex Stable vs. 2018 +16.1% -5.6% +3.3% +18.2% +7.8% Outlook Further uptake of the postpaid and convergent Love
Slide 23: Section five: Q&A
Section five Q&A 23
Slide 24: Orange Belgium Q3 2019 Financial Results
Orange Belgium Q3 2019 Financial Results October 23, 2019 24