Slide 1: Orange financial results
#Q1_2018 Orange financial results Ramon Fernandez Deputy CEO, Chief Financial and Strategy Officer 26 April 2018
Slide 2: Disclaimer
Disclaimer This presentation 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 c
Slide 3: Q1 2018 changes in financial reporting
Q1 2018 changes in financial reporting IFRS15 full Revenues split ARPO : Average retrospective approach per offer Revenue Per Offer FY17 Revenues in €m Old presentation -237 Revenues ARPO* Mobile services ARPU Mobile Only 41,096 40,859 Actual presentation Mobile equipment sales Mobile excl. incoming
Slide 4: Q1 2018 highlights
Section one Q1 2018 highlights
Slide 5: Group achievements
Q1 2018 Revenue Adjusted EBITDA* Group € 10.1 bn € 2.6 bn achievements +2.0% +3.8% +1.2% +1.2% +2.2% +2.1% FY’17 FY’17 Q1’18 FY’17 FY’17 Q1’18 yoy : comparison with the same period of the previous year, on a (IAS18) (IFRS15) (IAS18) (IFRS15) comparable basis unless otherwise specified All Group leve
Slide 6: Sustained investment efforts to keep our competitive advantage
Sustained 4G coverage investment Population covered in %, yoy evolution in pp efforts to keep 99.8% 99.7% 97% 96% 93% 90% our competitive +0,6pt +0,1pt +8pt +5pt +10pt +10pt advantage in Poland Belgium France Spain Romania Slovakia connectivity VHBB connectable homes* yoy yoy Spain 12.2 m +22% Q1 20
Slide 7: Solid commercial momentum driven by VHBB and 4G
Solid commercial VHBB customers in million 4G customers* in million momentum driven by VHBB and 4G 5.1m 48m +39% yoy +45% yoy 5.1 46 48 4.8 43 4.3 4.0 36 3.7 33 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 VHBB > 100 Mbps TV in million 9.1 Broadband Mobile contract 9.0 customer base 8
Slide 8: Convergence, the bedrock of our strategy
Convergent B2C customer base in million Convergence, % of broadband B2C customer base France Spain Poland the bedrock of 5.98 6.04 3.07 3.09 3.09 3.08 3.14 *** 1.03 1.09 our strategy 5.71 5.85 60% 82% 85% 0.86 0.95 52% 5.62 0.74 57% 38% 1.7 bn Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q1 17 Q2 17 Q3 17 Q4 17 Q1
Slide 9: Business review
Section two Business review
Slide 10: France
Q1 2018 France 4th consecutive quarter of total revenues growth, driven by convergent services in €m Q1 18 Q1 17 cb yoy cb Convergent B2C ARPO Revenues 4,492 4,400 +2.1% Quarterly ARPO in € 65.1 64.8 Retail services (B2C+B2B) 2,761 2,667 +3.5% 61.8 62.5 ePresse Convergent services* 1,100 959 +14.8%
Slide 11: France: commercial performance
Q1 2018 France : commercial performance Strong high-end mobile and broadband net adds in a very promotional environment Mobile contract net adds (in ‘000s, excl. M2M) Fixed Broadband net adds (in ‘000s) Total mobile contract Quarterly churn rate in % FTTH ADSL and others +320 +85 +108 +73 +57 +73 11
Slide 12: Spain
Q1 2018 Spain Another quarter of revenue growth, thanks to retail services, wholesale and equipment in €m Q1 18 Q1 17 cb yoy cb Convergent B2C ARPO Revenues 1,310 1,256 +4.3% Quarterly ARPO in € Retail services (B2C+B2B) 947 922 +2.7% +3.8% * Convergent services* 526 491 +7.0% 58.7 58.3 Mobile only
Slide 13: Spain: commercial performance
Q1 2018 Spain : commercial performance A value driven approach in a very competitive environment Mobile contract net adds (in ‘000s, excl. M2M) Fixed Broadband net adds (in ‘000s) Total mobile contract Quarterly churn rate in % FTTH ADSL and others 21.4% 21.8% +40 +8 -16 -13 +58 +61 -11 +51 +196 +14
Slide 14: Poland
Q1 2018 Poland Fixed broadband performance reflects the relevance of VHBB and convergent strategy Q1 18 Q1 17 cb yoy cb yoy in €m Revenues 648 652 -0.6% FTTH connectable Retail services (B2C+B2B) Convergent services* 411 70 415 49 -1.0% +42.9% 2.7m homes +60% Mobile only services 165 175 -6.0% Fixed
Slide 15: Belgium & Luxembourg
Q1 2018 Belgium & Luxembourg Solid customer net adds driven by convergence and unlimited offers Q1 18 Q1 17 cb yoy cb yoy in €m Revenues 307 304 +0.9% 2.4m in excl. M2M Retail services (B2C+B2B) 181 171 +6.2% Mobile contract customers +3.8% Convergent services* 21 8 +158.4% Mobile only services 150
Slide 16: Central European countries
Q1 2018 Central European countries Strong level of revenues growth maintained thanks to 4G penetration and wholesale in €m Q1 18 Q1 17 cb yoy cb yoy Revenues 435 405 +7.3% Retail services (B2C+B2B) Convergent services* 263 11 260 7 +1.2% +67.6% 4.8m 4G customers +36% Mobile only services 229 232 -1.
Slide 17: Africa & Middle East
Q1 2018 Africa & Middle East Revenues accelerated growth at +6.2% driven by Data, Orange Money, and B2B in €m Q1 18 Q1 17 cb yoy cb Revenues 1,245 1,173 +6.2% 11.7m* x3 Retail services (B2C+B2B) 1,016 936 +8.5% 4G customers yoy Mobile only services 910 832 +9.4% Fixed only services 103 102 +1.1% IT
Slide 18: Enterprise
Q1 2018 Enterprise Good resilience of revenues, supported by mobile equipment and IT growth levers in €m Q1 18 Q1 17 cb yoy cb Revenues Fixed only services 1,726 989 1,748 1,017 -1.3% -2.7% Cyberdefense Q1 revenue growth +20% yoy Voice 349 355 -1.6% Data 640 662 -3.4% IT & integration services 494 4
Slide 19: 2018 guidance
Section three 2018 guidance
Slide 20: Short and mid-term guidance
Short and mid-term guidance 2018 2019-2020 Adjusted EBITDA Higher growth rate vs 2017 Growth CAPEX €7.4bn (peak) Decrease Operating Cash Flow * Higher growth rate vs 2017 Growth Net debt / Adjusted EBITDA (telecom) Around 2x in the medium term Dividend €70 cent ( +€5 cent) New floor of €70 cent 20 *
Slide 21: Appendices
Appendices
Slide 22: Appendix: B2C + B2B Orange customers in France
Appendix: B2C + B2B Orange customers in France Mobile KPIs (in thousands) Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Mobile customers (excl. MVNOs) 28,612 28,966 29,508 30,033 30,489 31,150 31,624 31,777 32,012 Contract 24,581 25,069 25,759 26,486 27,090 27,842 28,433 28,821 29,184 M2M 4,
Slide 23: EBITDA adjustments
EBITDA adjustments in €m Q1’17 actual Q1’17 cb Q1’18 Adjusted EBITDA 2,530 2,510 2,605 restructuring and integration -5 -5 -16 litigations 15 15 2 labour related -24 -24 -13 portfolio review and others -6 0 0 Reported EBITDA 2,510 2,496 2,578 23
Slide 24: Revenues yoy evolution
Revenues yoy evolution France Africa & the Middle-East Group 3% 8% +6,2% +2,0% +2,1% 6% 2% 4% +3.0% +3.0% 1% +0.8% +0.6% 2% 0% 0% +1,2% +1,2% FY’17 FY’17 Q1’18 FY’17 FY’17 Q1’18 (IAS18) (IFRS15) (IAS18) (IFRS15) Europe Enterprise 6% 0% +3,9% 4% +3.2% +3.1% 2% -1% -1,0% -0.9% -1,3% FY’17 FY’17 Q1’18