France Telecom-Orange has posted revenues of EUR10.8 billion (USD13.9 billion) for the third quarter of 2012, down 4.5% year-on-year on an as reported basis. Third quarter EBITDA came in at EUR3.6 billion, representing a fall of 8.6% year-on-year on an as reported basis. The company cited a deteriorating macroeconomic outlook, strong competition in the French mobile market and continued regulatory pressure as being key reasons behind the weakening results, and warned that the challenges were likely to persist in 2013. Amid forecasts of a EUR1 billion weakening in operating cash flow, the telco has slashed its dividend by more than 33% from the level originally promised in February, and by almost 43% compared with last year’s payout on an earnings per share basis.
More encouragingly, France Telecom-Orange had 227.2 million customers at 30 September 2012, an increase of 3.1% year-on-year, with more than three million net additions coming in the third quarter. Despite the fierce competition in its domestic mobile market, the company says it was able to add 317,000 new customers, marking a turnaround in fortunes from the losses of 155,000 customers in the second quarter and 615,000 in the first quarter.
Commenting on the results for the first nine months of 2012 and the outlook for 2013 and 2014, Stephane Richard, Chairman and CEO of France Telecom-Orange, said: ‘The Group delivered solid results for the third quarter enabling us to confirm our operational cash flow target for 2012. This was due to a decidedly improved commercial performance in France compared to the first half, as well as the contribution from Spain and countries in Africa and the Middle East which continue to drive the Group’s growth.’