Slide 1: Orange financial results #FY_2019
Orange financial results #FY_2019 13 February 2020 Stéphane Richard Chairman and CEO Ramon Fernandez Deputy CEO, Finance, Performance and Europe
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements about Orange, notably on objectives and trends related to Orange’s financial situation, investments, results of operations, business and strategy. Although we believe these statements are based on reasonable assumptions, they are subje
Slide 3: Section one: FY 2019 highlights
Section one FY 2019 highlights
Slide 4: 2019 key highlights
2019 key highlights Revenue and EBITDAaL growth with acceleration in Q4 3 strong engines of revenue growth : MEA, Europe and Enterprise Improving trends of Retail services and ARPOs in France European leader in cybersecurity with double digit growth Structural change in the management of tower and f
Slide 5: 2019 key achievements
2019 key achievements New deals 3.1m >500k global, Cloud Customers Customers* secured Smart home SDWAN Multi- Services Launch of connected & protected home offers o/w 29% have a consumer loan Customers & offers Homelan NPS > 40 pts Customers Convergence VHBB Connectivity +23% Customer base 10.8m +3%
Slide 6: 2019 guidance achieved
2019 Revenue EBITDAaL guidance € 42.2bn € 12.9bn +1.3% +1.1% achieved +0.5% +0.8% +0.6% +0.7% +0.9% +0.8% +0.2% -0.1% Q1 19 Q2 19 Q3 19 Q4 19 2019 Q1 19 Q2 19 Q3 19 Q4 19 2019 7.3 2.3 1.96x 0.70 € billion € billion € yoy : comparison with the same period of the previous year, on a Net debt / compara
Slide 7: Investments
Investments stabilisation with a 40m eCapex to Sales (telecom, in %) 17.2% 17.2% fiber roll-out VHBB** connectable lines, FTTH eCAPEX o/w 38.2m FTTH +31% yoy acceleration in 14.9m lines in Spain,+8% yoy 4.2m lines in Poland, +25% yoy 13.6% 12.6% eCAPEX excl. FTTH France 2018 cb 2019 FTTH roll-out ac
Slide 8: Section two: Financial results overview
Section two Financial results overview
Slide 9: Revenue kept growing
Revenue kept Group revenue growth (yoy in %) +1.1% +1.1% growing 1.2 1.0 +1.0% 0.8 +0.7% 0.6 +0.8% +0.4% Total growth 0.4 Growth excl. +0.5% Digital content offers 0.2 0.0 -0.1% -0.2 Q1 19 Q2 19 Q3 19 Q4 19 Q4 2019 FY 2019 FY19 revenue growth by segment FY19 revenue growth by activity yoy yoy FY 201
Slide 10: FY EBITDAaL (Telecom) growth per segment
FY 19 EBITDAaL (Telecom) growth per segment (yoy in €m) EBITDAaL +0.9% -21 growth fuelled by 49 -82 13,019 Digital content offers MEA and Europe 12,907 157 68 4 4 Digital content offers 158 12,951 12,749 FY 18 cb France Spain MEA Europe Enterprise Others FY 2019 EBITDAaL margin evolution (telecom) O
Slide 11: Net income +49.4%
Net income +49.4% 108 grew +49.4% 124 -269 3,226 883 2,158 123 99 FY 2018 EBITDAaL cb Neutralisation adjustments Impairment Financial result D&A, income FY 2019 Net Income of IFRS 16 cb* of goodwill & tax paid & Net Income from lease interest fixed assets others from Consolidated expenses Consolidat
Slide 12: Organic Cash Flow at €2.3bn in 2019
Organic Cash Flow at € 2.3bn in 2019 Organic Cash in € bn 5.8 Flow* above -1.1 guidance. -1.2 -0.2 -0.9 2.3 EBITDAaL - income taxes paid net financial change in other operational Organic eCAPEX (telecom interests paid** working capital items Cash Flow * activities) 2019 Net debt*** (telecom activiti
Slide 13: Section three: Business review
Section three Business review
Slide 14: Q4 2019 France
Q4 2019 France Total revenues back to growth thanks to Convergence and Wholesale services FY 19 Revenues : +0.2% yoy excl. digital content offers (DCO) in €m Q4 19 yoy cb FY 19 yoy cb Revenues Retail services 4,731 2,730 +1.1% 18,154 10,807 -0.3% Q4 19 quarterly ARPOs (in €) and growth, yoy: -0.2% -
Slide 15: Q4 2019 France: commercial performance
Q4 2019 France: commercial performance Record quarter in fiber net adds. Good performance in mobile with decrease in churn Mobile contract net adds (in ‘000s) and churn rate Fixed BB net adds (in ‘000s) net adds excl M2M quarterly churn rate in % FTTH ADSL and others 13.8% 13.3% +49 +111 +61 +90 55%
Slide 16: Q4 2019 Spain
Q4 2019 Spain Preserving value and efficiency in a downtrend market in €m Q4 19 yoy cb FY 19 yoy cb Revenues 1,346 -2.3% 5,280 -1.5% 83% Convergence as % of broadband B2C customer base Retail services 938 -3.4% 3,760 -2.9% Convergent services* 525 -3.1% 2,092 -2.4% Mobile only services 284 -6.4% 1,1
Slide 17: Q4 2019 Europe
Q4 2019 Europe Improvement in profitability driven by indirect costs optimization and solid commercial performance in convergence Revenue evolution (yoy, in €m) in €m +1.7% Q4 19 yoy cb FY 19 yoy cb Revenues 1,548 +1.7% 5,783 +1.4% -12 1,548 Retail services 942 +2.4% 3,641 +2.9% -2 Convergent servic
Slide 18: Q4 2019 Africa & Middle East
Q4 2019 Africa & Middle East Excellent performance in €m Q4 19 yoy cb FY 19 yoy cb Revenues 1,461 +6.1% 5,646 +6.2% > 90%of Retail Services revenue growth in FY 19 from Retail services 1,229 +8.5% 4,738 +8.6% Mobile only services 1,098 +9.7% 4,230 +8.6% Data, Orange Money, and Fixed BB Fixed only se
Slide 19: Q4 2019 Enterprise
Q4 2019 Enterprise Back to revenue growth in 2019 driven by ongoing successful transformation in €m Q4 19 yoy cb FY 19 yoy cb Revenues 2,104 +0.8% 7,820 +1.0% Fixed only services 1,007 -0.9% 3,963 -1.7% Voice 325 -5.7% 1,289 -6.8% Cybersecurity Data 682 +1.6% 2,674 +1.0% IT & integration services 84
Slide 20: Section four: 2020 guidance
Section four 2020 guidance
Slide 21: Short and mid term guidance
Short and mid term guidance 2020e 2021e 2022e 2023e CAGR: EBITDAaL, yoy Flat + 2% to 3% eCAPEX incl. RAN sharing deals, yoy circa + €200m Flat Decrease Improved circa 3.5 Organic Cash Flow (telecom)* Guidance > €2.3bn Growth to €4bn Net debt / EBITDAaL (telecom) Around 2x in the medium term Dividend
Slide 22: Appendices
Appendices
Slide 23: Change in net income
Change in net income FY 2018 FY 2018 FY 2019 (in millions of euros, on a historical basis) historical cb actual EBITDAaL 13,005* 12,762 12,860 Neutralisation of IFRS 16 lease interest expenses effects in EBITDAaL - 119 123 Adjustments** (1,028) (868) 15 Depreciation & amortization of fixed assets (7
Slide 24: Adjustments
Adjustments FY 18 FY 18 FY 19 in €m historical cb Actual Cost of restructuring programs (189) (193) (165) Cost of acquisitions and integration (11) (11) (24) Significant litigations (33) (34) (49) Specific labour expenses (812) (812) (23) o\w Senior Part Time (812) (812) (25) Portfolio review and ot
Slide 25: Change in net debt
Change in net debt 2019 (in millions of euros) Actual EBITDAaL - eCAPEX (telecom activities) 5,754 Change in working capital requirements (204) Change in eCAPEX payables 45 Net interest paid (including dividends received)* (1,196) Income taxes paid (1,079) Other operational items** (975) Organic Cas
Slide 26: Convergent B2C customer base
Convergent B2C customer base in million % of broadband B2C customer base Convergence, France* Spain Poland 5.80 3.12 3.08 3.06 3.04 3.00 1.37 the bedrock of 5.73 5.77 85% 83% 1.31 1.33 62% our strategy 5.65 5.70 55% 1.24 1.28 55% 57% Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q4 18