Orange Sa · EURONEXT:ORA
Orange Sa — FY2021 Earnings Presentation
28 slides from Orange Sa's earnings presentation, Feb 17, 2022
Slide 1: Orange financial results #FY_2021
Orange financial results #FY_2021 17th February 2022 Stéphane Richard Chairman and CEO Ramon Fernandez Deputy CEO, Finance, Performance and Development 1 FY 21 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: Section One: FY 2021 highlights
Section One FY 2021 highlights FY 21 Results 3
Slide 4: Q4 Key messages
Q4 Key messages FTTH European leadership strengthened Q4 EBITDAaL -0.7% yoy with globally 11.8m customers +22% yoy +4.7% excl. employee shareholding plan out of 56.5m FTTH connectable homes Convergence European leadership Q4 eCapex down -6.2% yoy confirmed with 11.5m customers and with more than 80%
Slide 5: Our commitments for environment, digital inclusion and diversity
Digital inclusion Our commitments develop connectivity and inclusive services Ambitions for environment, FTTH connectable homes 56.5m 69m / 2023 digital inclusion Orange Digital Centers 9 ≥26 / 2025 and diversity Environment reduce our CO2 eq. emissions and implement circular economy to achieve Net
Slide 6: 2021 financial achievements
2021 financial achievements Revenue EBITDAaL eCapex FY 2021 Q4 2021 FY 2021 Q4 2021 FY 2021 Q4 2021 €42.5bn €11.1bn €12.6bn €3.2bn €7.7bn €2.1bn +0.8% +0.5% -0.5% -0.7% +7.8% -6.2% yoy yoy yoy yoy yoy yoy +0.8% +4.7% excl. employee shareholding plan Organic Cash Flow Net debt / EBITDAaL FY 2021 FY 2
Slide 7: Section Two: Financial results overview
Section Two Financial results overview FY 21 Results 7
Slide 8: Revenue growth
FY 2021 revenue growth contribution per segment (yoy in €m) Revenue +0.8% growth +0.5% +10.6% 42,522 60 +2.6% 40 42,201 Other European Countries 611 -303 147 -230 -1.6% Spain -86 -4.7% FY 20 cb France Europe MEA Enterprise Others FY 21 Q4 2021 FY 2021 FY 2021 revenue evolution per activity (yoy in %
Slide 9: EBITDAaL in line with guidance
FY 2021 Group EBITDAaL evolution per segment EBITDAaL yoy, in €m in line with +0.8% excl. employee shareholding plan guidance 12,635 -0.5% +20.7% +16.8% Mobile -88 12,566 Financial -165 -205 34 -52 Services* -131 327 -8.3% +6.6% -2.9% -182 97 Telecom 12,799 12,696 Q4 2021 FY 2021 activities -12.7% y
Slide 10: Scale up
Scale up On track to reach €1bn net reduction target by 2023 2021 2022 2023 >€300m ~€600m €1bn net savings vs 2019 net savings vs 2019 net savings vs 2019 First milestones achieved with a new mindset in place …and initiatives underway feeding costs reductions … New intergenerational agreement in Fra
Slide 11: Net income
FY 2021 Group net income evolution (yoy, in €m) Net income -€4,278m 5,055 739 -3,702 down due to -69 impairment on 532 -1,810 Spain and 33 778 tax refund base FY 20 EBITDAaL cb Non recurring Impairment of Financial result Tax paid D&A & others FY 21 effect operating items Spain goodwill (adjustments
Slide 12: Organic Cash Flow reaching €2.4bn in 2021
Organic Cash Flow (OCF)* reaching €2.4 bn in 2021 (in €m) 5,060 €2.4bn -85 -997 Organic Cash -955 2,700 2,401 c.300 c. Flow -622 EBITDAaL change in net financial income other OCF* 2021 Allocation of OCF* 2021 -eCapex working capital interests paid** taxes paid operational tax refund before (telecom
Slide 13: Section Three: Business Review
Section Three Business Review 13 FY 21 Results 13
Slide 14: Q4 2021 France
Q4 2021 France EBITDAaL growing excluding cofinancing & eCapex starting to decrease in €m Q4 21 yoy cb FY 21 yoy cb Revenue stabilization FY excl. cofinancing Revenues 4 658 -1.5% 18 092 -1.6% Retail services 2 740 +1.6% 10 846 +0.8% +4% Q4 retail services acceleration excl. PSTN Wholesale 1 302 -9.
Slide 15: Q4 2021 Europe
Q4 2021 Europe Positive commercial results. Excluding Spain, +6.6% FY 2021 EBITDAaL growth. Q4 21 yoy cb FY 21 yoy cb Q4 Revenue evolution (in €m) in €m Revenues 2 833 -1.5% 10 579 -0.8% Retail services 1 854 -1.8% 7 046 -2.3% -49 18 Wholesale 509 -2.8% 1 886 -2.9% -31 2,875 19 Equipment sales 425 -
Slide 16: Q4 2021 Spain
Q4 2021 Spain H2 EBITDAaL on a significant trend improvement EBITDAaL trend improved yoy in €m Q4 21 yoy cb FY 21 yoy cb Revenues 1 176 -4.0% 4 720 -4.7% Retail services 792 -5.4% 3 198 -8.0% -7.5% -9.0% Wholesale 229 -2.9% 900 -1.8% Equipment sales 155 +1.8% 621 +13.6% -16.2% EBITDAaL 1 251 -12.7%
Slide 17: Q4 2021 Africa & Middle East
Q4 2021 Africa & Middle East Outstanding performance with FY 2021 EBITDAaL growth +17% in €m Q4 21 yoy cb FY 21 yoy cb Revenues 1 687 +9.0% 6 381 +10.6% Retail services 1 469 +10.8% 5 579 +12.8% Wholesale 178 -1.5% 654 -4.7% Equipment sales EBITDAaL 31 2.1% 112 +16.5% 44.4m 4G customers +25.4% Data
Slide 18: Q4 2021 Enterprise
Q4 2021 Enterprise Revenue back to growth, EBITDAaL impacted by legacy decline accelerated by the pandemic in €m Q4 21 yoy cb FY 21 yoy cb Solid annual growth in IT&IS Revenues 2 053 +0.7% 7 757 +0.5% Fixed only services 900 -5.0% 3 633 -4.8% IT & integration services +14% yoy 885 +2.9% 3 195 +5.4%
Slide 19: Mobile Financial Services
Mobile Financial Services Net Banking Income’s growth putting EBITDAaL on recovery path Net Banking Income and EBITDAaL positive evolution EBITDAaL Mobile +109 Telco Net Banking Income +69 Synergies Finance universe Services -165 -131 Device financing FY 20 FY 21 Distribution network Risk Management
Slide 20: Section Four: Guidance
Section Four Guidance 20 FY 21 Results 20
Slide 21: Guidance 2021 fully achieved, solid ramp up in 2022
Guidance 2021 fully achieved Solid ramp up in 2022 2021 before tax refund 2021 2022 allocation Growth EBITDAaL, yoy Around +1% Flat - between +2.5 to +3% eCAPEX ~ €7.3bn € 7.6 - 7.7bn ≤ €7.4bn Organic Cash Flow > €2.6bn > €2.2bn ≥ €2.9bn (telecom) Net debt / EBITDAaL Around 2x Around 2x Around 2x (t
Slide 22: Guidance 2023 reiterated
Guidance 2023 reiterated Organic Cash flow to reach €3.5bn-€4bn Organic Cash Flow weight on Executive (in €bn) Team remuneration scheme : 50% >2.6 * Guidance >2 >2.3 >2.2 3.5 to 4.0 achieved ≥ 2.9 2.7 * 2.5 2.3 2.4 2019 2020 2021 2022 2023 * Before allocation of the tax refund received in 2020 22 22
Slide 23: Annexes
Annexes 23 FY 21 Results 23
Slide 24: eCapex
eCapex 57.5m VHBB** connectable lines downward trend o/w 56.5m initiated in H2 FTTH connectable lines FTTH connectable VHBB connectable FTTH connectable eCapex/revenue (telecom,%) lines in France lines in Spain lines in Poland 16.8% 18.0% +26% +5% +19% FTTH eCAPEX 28.8m 16.1m eCAPEX 5.9m 12.6% 13.0%
Slide 25: Convergent B2C customer base in million
Convergent B2C customer base in million % of broadband B2C customer base Convergence, France Spain Poland the bedrock of 67% 5.90 3.03 1.55 3.02 85% 3.02 1.53 5.88 3.01 1.52 our strategy 53% 85% 54% 5.85 5.86 3.00 65% 1.50 5.84 5.90 3.00 3.01 3.02 3.03 3.02 1.48 1.55 5.84 5.85 5.86 5.88 1.48 1.50 1.
Slide 26: Change in net income
Change in net income FY 2020 FY 2020 FY 2021 (in millions euros) historical cb actual EBITDAaL 12,680 12,635 12,566 Adjustments* (115) 623 Depreciation & amortization of fixed assets (7,134) (7,074) Impairment of goodwill & fixed assets (30) (3,719) Share of profit (losses) of associates and JV (2)
Slide 27: Adjustments
Adjustments FY 2020 FY 2020 FY 2021 (in millions euros) historical cb actual Restructuring programs costs (83) 12635.25 (422) Acquisitions and integration costs (37) (51) Significant litigations (211) (134) Specific labour expenses (12) (1,276) o\w Senior Part Time (13) (1,262) Fixed assets, investm
Slide 28: Change in net debt
Change in net debt FY 2020 FY 2021 (in millions of euros) historic actual EBITDAaL - eCAPEX (telecom activities) 5,736 5,060 Change in eCAPEX payables 307 (205) Change in working capital requirements (500) 120 1 Net interest paid (including dividends received) (1,127) (997) Income taxes paid (1,085)