Slide 1: Orange financial results H1 2024
Orange financial results #H1_2024 Christel Heydemann CEO Laurent Martinez CFO 24th July 2024 H1 24 results 1
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements about Orange’s financial situation, results of operations and strategy. Although we believe these statements are based on reasonable assumptions, they are subject to numerous risks and uncertainties, including matters not yet known to
Slide 3: Demonstrating our expertise for the Olympics
Demonstrating our expertise for the Olympics H1 24 results 3
Slide 4: Executive Summary
Executive Summary Lead the Future mid-term: execution fully on track France: market leader, a disciplined pricing strategy MASORANGE defines its fibre network strategy Solid H1 financial results with +17.4% OCF growth yoy FY 2024 Guidance fully confirmed In our IFRS accounts MASORANGE is presented u
Slide 5: Lead the Future "mid-term"
1 Lead the Future “mid-term” H1 24 results 5
Slide 6: Lead the Future on track
Lead the Future on track Focus & MEA Monetise Capitalise Transform growth Continued value strategy FTTH leadership Portfolio rationalisation MEA revenues & EBITDAaL & ARPO increase 53.2m connectable homes OCS/ O.Studio sale double-digit growth* in Europe O.Bank withdrawal in Europe +2.9% Retail ex P
Slide 7: Focus on France
2 Focus on France H1 24 results 7
Slide 8: Orange leader in France
Zoom Orange leader in France France Market slowdown since 2023 Orange leader in the market French telco market growth (ARCEP data) Strong customer bases with leadership on high-end +3.3% +3.3% 21.8m +2.9% +2.6% +2.5% 11.6m 12.3m +1.3% +1.4% 6.3m 6.0m +0.9% 10.2m 6.0m Q1 Q1 Q1 Q1 21 22 23 24 Mobile*
Slide 9: Orange's disciplined pricing policy
Zoom Orange’s disciplined pricing policy France Upsell Cross-sell Segmented • 5G/FTTH migration commercial Leverage shops & 5G 36% strategy diversified portfolio penetration(1) Address all market segments • Convergence FTTH 71% penetration • New B2C cyber offer • New 2P & 3P offers • Tactical price
Slide 10: Volume/value strategy paying off
Zoom Volume/value strategy paying off France (1) Mobile Fixed broadband Convergence Cumulated FTTH net adds +1.0m +30k (over 4 quarters) +17k +99k +104k +261k +83k +1k Improving net adds -4k in Q2 (vs Q1) +29k -31k -30k -17k +9k -33k -43k -23k Q2 23 Q2 24 Q2 23 Q2 24 Q2 23 Q2 24 ADSL net adds Total
Slide 11: MASORANGE defines its fibre network strategy
3 MASORANGE defines its fibre network strategy H1 24 results 11
Slide 12: MASORANGE defines its fibre network strategy
MASORANGE defines its fibre network strategy Focus on value creation through… …maximisation of FTTH network utilisation… ▪ Signing on 24th July of a non-binding term-sheet with Vodafone Spain to enter into exclusive discussions to create a joint FibreCo in Spain which would cover approximately 11.5
Slide 13: H1 results
4 H1 results H1 24 results 13
Slide 14: Solid financial results paving the way to FY guidance
Solid financial results paving the way to FY guidance Revenues EBITDAaL eCapex H1 2024 Q2 2024 H1 2024 Q2 2024 H1 2024 Q2 2024 €19.8bn €10.0bn €5.5bn €3.1bn €2.9bn** €1.5bn +1.5% +0.9% +2.5% +2.6% +2.6% yoy +2.2% yoy yoy yoy yoy yoy 14.7% eCapex/sales (telecom) Organic Cash Flow* Free Cash Flow* “al
Slide 15: On track with our ESG commitments
On track with our ESG commitments With solid H1 achievements Trusted partner Environmental transition • Human rights policy published in Q1 • B2C cyber solutions launched in France in Q2 GHG reduction objectives: • -30% in 2025 vs 2015cb (scope 1&2): already achieved Digital inclusion & empowerment
Slide 16: Financial results overview
5 Financial results overview H1 24 results 16
Slide 17: Revenues
Q2 2024 revenue development by activity (yoy in €m) +€85m Revenues +2.4% growth fuelled by 182 -128 +1.2% 25 9,989 7 MEA & Retail 9,903 -7.9% +10.5% Q2 23 cb Retail Wholesale Equipment Others Q2 24 services sales Q2 2024 revenue development by segment (yoy in €m) +0.9% +10.3% -27 -1.4% -39 9,989 177
Slide 18: EBITDAaL
Solid H1 2024 Group EBITDAaL development by segment (yoy, in €m) EBITDAaL +2.5% -35 -60 5,511 183 growth -11.3% 5,378 37 10 +14.7% in line with FY +0.3% +4.0% guidance H1 23 cb France Europe MEA Orange Others H1 24 Business EBITDAaL margin% 28.1% (telecom activities) 27.8% H1 2024 ▪ H1 EBITDAaL yoy
Slide 19: Net income
Net income H1 2024 Group net income development (yoy, in €m) +€4m stable -21 49 134 -192 1,088 1,092 -10 75 -30 H1 23 EBITDAaL Other non Financial Income tax Depreciation MASORANGE Others* H1 24 cb recurring result & creation net amortisation effect** Earnings per share items* €0.30 1 2 3 €0.28 (Gro
Slide 20: eCapex
eCapex H1 2024 eCapex development by segment (yoy in €m) +2.6% disciplined 69 -4 -40 2,921 2,921 c.15% 2,847 32 2,847 16 eCapex/sales H1 23 cb France Europe MEA Orange Others H1 24 Business (Orange Bank & Wholesale) eCapex/Sales 14.6% 14.7% H1 2024 eCapex ▪ Increased eCapex in MEA to support growth
Slide 21: OCF and FCF all-in
In € million, telecom activities OCF +€64m yoy & 2,652 -226 FCF « all-in » +€230m -390 yoy +€219m strong growth -511 1,551 yoy 25 -174 -107 1,255 -15 EBITDAaL ∆ net income other OCF H1 Telco Subord. Main FCF -eCapex working financial taxes operational 2024 licences notes litigations "all in" (teleco
Slide 22: Net debt
In € million Net debt Net debt/ EBITDAaL* (telecom) 2.05x 1.90x improvement 27,002 -3,991 213 -1,255 1,117 -4,311 23,011 245 Net financial FCF "all-in" Div.paid to Dividend Total net Other (2) Net financial debt FY 2023* excluding owners of paid to non- effect of debt H1 2024* Spain parent controlli
Slide 23: Business Review
6 Business Review H1 24 results 23
Slide 24: Q2 2024 France
Q2 2024 France Solid retail, EBITDAaL improvement Retail services ex. PSTN fully in line with in €m Q2 24 yoy cb H1 24 yoy cb CMD target between +2% and +4% Revenues 4,396 +0.3% 8,736 +0.6% 3.4% 3.4% Retail services 2,824 +1.3% 5,618 +1.5% 3.1% 3.0% 2.5% Wholesale 1,091 -5.7% 2,146 -4.9% 2.1% 2.0% 2
Slide 25: Q2 2024 Europe
Q2 2024 Europe Strong EBITDAaL growth EBITDAaL strong growth yoy in €m Q2 24 yoy cb H1 24 yoy cb Revenues 1,741 -2.2% 3,468 -2.1% Poland Belgium Retail services* 1,147 +1.1% 2,277 +1.0% Wholesale 210 -10.8% 408 -10.1% +3.8% +13.9% Equipment sales 224 -4.6% 482 -3.1% IT&IS and other revenues 160 -8.1
Slide 26: Q2 2024 Africa & Middle East
Q2 2024 Africa & Middle East Outstanding EBITDAaL double digit growth Powerful growth engines yoy (in €m) in €m Q2 24 yoy cb H1 24 yoy cb +10.3% Revenues 1,893 +10.3% 3,742 +10.7% 1,893 Retail services 1,710 +11.3% 3,373 +11.7% o/w B2B* +€37m +14% 18 26 29 +2% Wholesale 150 -0.2% 302 +0.5% +19% 104
Slide 27: Q2 2024 Orange Business
Q2 2024 Orange Business In line with turnaround roadmap in €m Q2 24 yoy cb H1 24 yoy cb Improving EBITDAaL towards growth in 2025 +5.4pt Revenues 1,980 -1.4% 3,919 -0.9% H1 H2 H2 H1 H2 H1 23 FY Fixed only services 751 -7.9% 1,502 -8.3% 22 22 23 24 24 25 IT & integration services 977 +4.6% 1,914 +6.0
Slide 28: Q2 2024 MASORANGE
Equity method from Q2 Q2 2024 MASORANGE Integration roadmap and synergies on track H1 24 yoy cb in €m Q2 24 yoy cb (1) proforma Revenues 1,785 -0.9% 3,609 +0.1% ▪ Leadership in commercial acquisition shares Service revenues 1,572 -0.5% 3,139 -0.2% Retail 1,436 +0.3% 2,887 +1.1% Wholesale 135 -8.4% 2
Slide 29: Guidance
7 Guidance H1 24 results 29
Slide 30: Guidance 2024 fully confirmed
Guidance 2024 fully confirmed 2024 excluding Spain* EBITDAaL yoy, cb Low-single digit disciplined eCAPEX yoy, cb eCapex as per CMD Organic Cash Flow (telecom) ≥ €3.3bn Around 2x Net debt / EBITDAaL (telecom) in the medium term Dividend** €0.75 payable in 2025 * As of January 1st, 2024; for EBITDAaL,
Slide 31: Q&A
Q& A Q&A press will start at 10:30am CET H1 24 results 31
Slide 32: Annexes
Annexes H1 24 results 32
Slide 33: Orange Spain – accounting treatment
Orange Spain – accounting treatment In this presentation, Orange Spain figures have been fully excluded from 1st January 2024 for all KPIs except the net financial debt Q1 2024 Closing From Q2 2024 & 2022 / 2023 restated Actuals IFRS 5 Deconsolidation of Orange Spain & Accounting of 50% of the JV Or
Slide 34: Group figures restated from Orange Spain
Group figures restated from Orange Spain Accounting treatment FY 2023 2024 H1 Reported Fully Restated Excluding D Reported Actuals excluding Actuals Spain (inc. D Spain* IFRS 5 in €bn O.Spain) Revenues 44.1 -4.4 39.7 39.7 19.8 n/a 19.8 EBITDAaL 13.0 -1.2 11.8 11.8 5.5 n/a 5.5 eCapex 6.8 -0.8 6.1 6.8
Slide 35: FCF "all-in" excluding Spain
FCF “all-in” excluding Spain Telecom activities H1 2023 FY 2023 H1 2024 (in millions of euros) actual actual actual EBITDAaL – eCAPEX – excluding Spain 2,588 5,883 2,652 Change in working capital requirements (including change in eCAPEX payables) (186) 15 (226) 1 Net interest paid (including dividen
Slide 36: Change in net debt (incl. 3 months of O.Spain)
Change in net debt (incl. 3 months of O.Spain) Telecom activities H1 2023 FY 2023 H1 2024 (in millions of euros) actual actual actual Free Cash Flow « all-in » – including Spain (reported) 1,151 2,940 1,138 1 Net impact of changes in the scope (1,851) (1,959) 4 346 2 Subordinated notes issuances (pu
Slide 37: Change in net income
Change in net income H1 2023 H1 2024 D (in millions euros) historical actual EBITDAaL 5,313 5,511 Adjustments* (256) (276) (20) Depreciation & amortization of fixed assets (3,091) (3,102) (10) Impairment of fixed assets (4) (13) (9) Share of profit (losses) of associates and JV (8) (222) (214) o\w S
Slide 38: EBITDAaL adjustments
EBITDAaL adjustments H1 2023 H1 2024 D (in millions euros) historical actual Restructuring programs costs (70) (143) (73) 1 Acquisitions and integration costs (28) (10) 18 Significant litigations 57 23 (33) Specific labour expenses (265) (7) 258 o\w Senior Part Time (265) (7) 258 2 Fixed assets, inv
Slide 39: Finance table details by segment
Finance table details by segment France Europe in €m Q2 24 yoy cb H1 24 yoy cb in €m Q2 24 yoy cb H1 24 yoy cb Revenues 4,396 +0.3% 8,736 +0.6% Revenues 1,741 -2.2% 3,468 -2.1% Retail services 2,824 +1.3% 5,618 +1.5% Retail services* 1,147 +1.1% 2,277 +1.0% Convergent services 1,313 +4.9% 2,601 +4.6