Orange Group achieves all 2014 financial targets

17 Feb 2015

International telecoms giant Orange Group has published its financial results for the twelve months ended 31 December 2014, claiming to have achieved all of its 2014 financial targets. In the period under review, the France-based company generated a total turnover of EUR39.445 billion (USD44.73 billion), a 2.5% decline year-on-year, although Orange Group pointed out that the development represented an improvement on the 4.5% decrease in revenues reported in 2013. Excluding the impact of regulatory measures revenues fell by 1.6% y-o-y in 2014, compared to a decline of 2.6% in the previous twelve months. The downturn was mainly attributed to the financial performance of Orange’s units in France, Spain and Belgium, but partly offset by strong growth in Africa and Middle East.

Restated EBITDA for 2014 stood at EUR12.190 billion, down 1% on a comparable basis from EUR12.507 billion in the year-earlier period, with a margin of 30.9% (unchanged year-on-year). Meanwhile, operating costs were reduced by EUR707 million on a comparable basis, offsetting 69% of the decline in revenues, while the company’s direct costs declined by EUR204 million. Capital expenditures in the twelve months to end-December 2014 totalled EUR5.636 billion, up 1.3% from EUR5.563 billion a year earlier, while network investments represented 59% of the group’s CAPEX (up 3.1% y-o-y), with ‘a large share’ said to have been spent on 4G and fibre-optic deployments in Europe, particularly in France. Further, the company has issued its outlook for 2015, saying that it expects restated EBITDA of between EUR11.9 billion and EUR12.1 billion for the year.

In operational terms, Orange Group claimed 244.161 million customers worldwide at the end of 2014, up from 237.254 million twelve months earlier. Mobile subscribers accounted for 185.327 million of these customer accounts. In its domestic market, Orange reported that its subscriber base reached 27.087 million customers, a marginal 0.7% increase year-on-year (+186,000 net additions), while Africa and the Middle East contributed a total of 97.494 million, an increase of 10.8% y-o-y, mainly due to growth in Ivory Coast, Madagascar, Niger and Congo. Elsewhere, Orange reported subscriber growth in the likes of Spain, Poland, Moldova and Egypt, while Jordan, Luxembourg and Uganda all saw their customer bases contract. Orange’s consolidated fixed broadband user base climbed to 16.014 million by end-December 2014, a 3.5% improvement on the 15.469 million reported in 2013, with Spain leading the pack in terms of net additions (273,000), followed by France (245,000) and Slovakia (25,000).

Commenting on the results, Orange chairman and CEO Stephane Richard was cited as saying: ‘While the competitive pressure remained very high in 2014 in all of our markets, our commercial performance was excellent and we achieved all of our financial targets. We succeeded in stabilising our restated EBITDA ratio thanks to our commercial performance coupled with our ongoing cost reduction efforts. Our strategy of differentiation through investment in very high-speed broadband and the quality of our networks and services has paid off, particularly in France, where fibre and 4G attracted many customers. We have also reduced our cost basis by more than EUR1.7 billion in three years.’

France, Orange Group