Orange Belgium Sa · EURONEXT:OBEL
Orange Belgium Sa — Q1 2020 Earnings Presentation
34 slides from Orange Belgium Sa's earnings presentation, Apr 23, 2020
Slide 1: Orange Belgium Q1 2020 Financial Results
Orange Belgium Q1 2020 Financial Results April 23, 2020
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: COVID-19 impact
Section one COVID-19 impact 3
Slide 4: Orange Belgium is proving to be essential in the COVID-19 crisis response
Orange Belgium is proving to be essential in the COVID-19 crisis response Human Network & Services Government Health Sector Protection of Ensure continuity Campaign to support Support to Customers & Employees and stability lockdown measures Hospitals & Nursing Homes The protection of Provide efforts
Slide 5: Expected 2020 COVID-19 impact
Expected 2020 COVID-19 impact Expected operational Expected financial & commercial impacts impacts Lockdown with temporary closure of shops Lower gross adds (mobile & convergence) Moderate revenues decrease Reduction in handset sales More limited on EBITDAaL Decrease in roaming and SMS traffic R
Slide 6: Updated dividend in the COVID-19 context
Updated dividend in the COVID-19 context 2019 Dividend BoD recommends the AGM not to increase the 2019 dividend to €0.60 per share as initially foreseen and to adopt an unchanged dividend of €0.50 per share 6
Slide 7: Section two: Q1 2020 Highlights
Section two Q1 2020 Highlights 7
Slide 8: March 2020: Launch of new mobile portfolio GO
9 March 2020: Launch of new mobile portfolio GO The first mobile family offer in Belgium creating upsell opportunities 8 Orange Restricted 8
Slide 9: Boost of B2B offers to maintain our challenger position vs. competition
Boost of B2B offers to maintain our challenger position vs. competition 9 Orange Restricted 9
Slide 10: Q1 2020 Key achievements
Q1 2020 Key achievements Mobile contract excl. M2M Convergent customers Net additions 17.4% 2.6 m 280 k Mobile contract excl. +9k of total postpaid mobile +3.9% yoy +40% yoy M2M base is convergent Convergent customer + 21 k Belgium Belgium Belgium Belgium Revenues Retail service revenues EBITDAaL eC
Slide 11: Section three: Operational Results
Section three Operational Results 11
Slide 12: Convergence: strong net-adds confirm attractiveness of the Love Duo/Trio offer
Convergence: strong net-adds confirm attractiveness of the Love Duo/Trio offer 19 19 25 20 17 25 21 14 16 Love (‘000) 280 258 Love customer net adds, 180 200 216 233 +21k +8% yoy 155 122 136 Love customers yoy 40% variation Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Conv
Slide 13: Growth of the mobile postpaid customer base within a competitive landscape
Growth of the mobile postpaid customer base within a competitive landscape and COVID-19 impact 3.9% 2,516 2,548 2,579 2,588 32 31 9 2,490 21 272 294 319 352 385 26 Customer base (‘000) Net adds (‘000) 25 33 33 29 22 7 4 2,218 2,222 2,229 2,227 2,202 -2 -7 -24 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020
Slide 14: Mobile prepaid: continued decline in Q1
Mobile prepaid: continued decline in Q1 -9% Customer base (‘000) -4 -4 -6 Net adds (‘000) 561 557 553 -21 -21 532 511 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 14
Slide 15: Mobile: Average mobile data usage reaches 5.0 GB
Mobile: Average mobile data usage reaches 5 GB +34% +38% Average mobile data +79% usage (GB) (excl. MVNO) +35% 5.0 +55% 4.5 4.1 +57% 3.7 3.7 +120% 3.2 2.9 2.5 1.3 1.3 1.8 Average mobile data 5.0 GB 0.3 0.9 0.3 0.6 0.5 0.9 usage (smartphone), 0.1 EoP 2013 EoP 2014 EoP 2015 EoP 2016 EoP 2017 EoP 2018
Slide 16: Slight decrease in B2C convergent ARPO and in mobile-only ARPO
Slight decrease in B2C convergent ARPO and in mobile-only ARPO Quarterly B2C convergent ARPO (€) Quarterly mobile only ARPO (€) +7.7% -1.1% +4.1% -1.6% -2.5% +1.3% +1.6% -3.2% -2.6% -1.9% 77,4 76,8 77,7 76,7 20,8 20,6 21,2 20,4 20,3 75,9 7.1 6.9 6.6 6.7 6.7 6,6 7,1 6,7 6,9 6,7 Q1 2019 Q2 2019 Q3 201
Slide 17: Regulatory update (1/2)
Regulatory update (1/2) 6 April 2020 - CRC draft decision submitted to the EC. EC has until early May to adopt its position. The Belgian regulators will then have to integrate the EC comments if any and publish their final decision Orange Belgium’s key comments: Cable Regulation • Orange Belgium
Slide 18: Regulatory update (2/2)
Regulatory update (2/2) End 2019, the BIPT launched a consultation regarding various spectrum related matters mainly to deal with intermediate and/or associated spectrum matters the extension of the 900 MHz, 1800 MHz and 2100 MHz licenses beyond the current expiry date of March 2021 the propos
Slide 19: Q1'20 update: Simplification, Digitalization, Empowerment
Q1’20 update Simplification Digitalization Empowerment Launch new GO offer portfolio Focus on non-physical sales Increase Customer Service first Migration from legacy offer channels (boosted by COVID-19 contact resolution started context) End-to-End responsibility Renegotiation of IT & N
Slide 20: Section four: Financial Results
Section four Financial Results 20
Slide 21: Retail service revenues: solid growth
Retail service revenues: solid growth +13.5% +9.6% +7.1% +6.5% +4.6% Retail service revenues (€ m) 221,8 222,8 224,8 205,7 207,0 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Retail service revenues yoy 21
Slide 22: Convergent service revenues: strong growth
Convergent service revenues: strong growth +83.4% +69.9% Convergent service revenues (€ m) +54.2% +47.7% +35.8% 48,2 51,7 41,0 44,3 38,1 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Convergent service revenues yoy 22
Slide 23: Mobile only service revenues decreased due to convergence uptake
Mobile only service revenues decreased due to convergence uptake Mobile only service revenues (€ m) +3.0% +0.1% -2.2% -2.5% -3.9% 154,4 153,3 155,4 150,5 148,4 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Mobile only service revenues yoy 23
Slide 24: Orange Belgium Group: Q1 2020 strong financial results
Orange Belgium Group: Q1 2020 strong financial results 1,350.4 299.9 369.5 79.6 EBITDAaL (€ m) Revenues (€ m) 334.3 83.6 318.9 78.9 333.9 62.2 327.7 333.9 +1.9% +7.6% 57.8 62.2 2019 2020 2019 2020 Q1 Q2 Q3 Q4 • Q1’19 figures on a comparable basis 24
Slide 25: Revenues growth driven by increase in retail service revenues
Revenues growth driven by increase in retail service revenues Revenues evolution (€ m) +1.9% +9.9 Convergent service revenues +4,1 MVNO +13,6 -5.6 -2.4 +333.9 Fixed & IT service -1.4 +327.8 +2,3 revenues -6.0 Mobile service +9,6 + revenues +318.2 Q1 2019 BKM Q1 2019 Retail service Wholesale revenues
Slide 26: EBITDAaL increased thanks to higher retail service revenues and cost efficiencies
EBITDAaL increased thanks to higher retail service revenues and cost efficiencies EBITDAaL evolution (€ m) +7.6% +2,5 +8,7 -12.9 + 62.2 +6,1 58.0 57.7 -0.3 Q1 2019 BKM Q1 2019 Revenues Direct Labor Indirect Q1 2020 Reported Comparable costs costs costs 26
Slide 27: Q1 2020 eCapex
Q1 2020 eCapex eCapex (€ m) Net debt €229.0 m -4.8% 11.3% 10.5% 36.9 35.1 Net debt/EBITDAaL 12.3 8.8 0.8x 24.6 26.3 Q1 2019 Q1 2020 Cable capex incl. CPE, IT & Network, etc. Core capex Total capex to total revenues ratio 27
Slide 28: Cable financials improved but remained negative
Cable financials improved but remained negative Variations Revenues: €32.8 m +37% EBITDAaL: €2.5 m +€3.7 m eCapex: €8.8 m -28% Operating cash flow: - €6.3 m +€7.1 m 28
Slide 29: Section five: 2020 guidance
Section five 2020 guidance 29
Slide 30: Orange Belgium will consider an update of 2020 guidance after Q2
Orange Belgium will consider an update of 2020 guidance after Q2 2020 Guidance Revenues growth Low-single digit growth vs. 2019 EBITDAaL €310-330 m eCapex Stable vs. 2019 (excluding the RAN sharing agreement) Outlook COVID-19 impact to be taken into account Limited headwinds in comparison to 201
Slide 31: Section six: Q&A
Section six Q&A 31
Slide 32: Orange Belgium Q1 2020 Financial Results
Orange Belgium Q1 2020 Financial Results April 23, 2020
Slide 33: New mobile portfolio
New mobile portfolio 33 Orange Restricted 33
Slide 34: New Love portfolio - pricing
New Love portfolio - pricing Set-up fee: 49€ Set-up fee: 49€ + + Multiproduct Multiproduct 34 Orange Restricted advantage advantage