Communiqué Orange: first half 2022 financial results
Press releaseParis, 28 July 2022
Financial information at 30 June 2022
Growth in EBITDAaL and decrease in
eCapex boost organic cash flow
The Group again confirms its financial
objectives for 2022, a milestone towards the achievement of its
2023 commitments
In millions of euros |
|
2Q 2022 |
changecomparablebasis |
changehistoricalbasis |
|
6M 2022 |
changecomparablebasis |
changehistoricalbasis |
Revenues |
|
10,715 |
(0.4)% |
1.6 % |
|
21,297 |
0.1 % |
2.1 % |
EBITDAaL |
|
3,314 |
0.5 % |
1.3 % |
|
5,934 |
0.7 % |
1.7 % |
Operating Income |
|
|
|
|
|
2,420 |
na |
na |
Consolidated net income |
|
|
|
|
|
1,467 |
|
na |
eCAPEX (excluding licenses) |
|
1,803 |
(11.1)% |
(13.5)% |
|
3,413 |
(8.7)% |
(11.3)% |
EBITDAaL - eCAPEX |
|
1,511 |
19.2 % |
27.2 % |
|
2,521 |
17.0 % |
26.6 % |
Organic cash-flow (telecom activities) |
|
|
|
|
|
1,445 |
|
72.1 % |
-
Revenues grew 0.1%1 in 1H 2022 and were slightly
down by 0.4% in 2Q 2022, impacted by the underlying effect of fiber
network co-financing received in 2Q 2021. In 2Q 2022:
- France (-2.7%)
recorded solid growth in retail services of 1.4% (+3.4% excluding
PSTN).
- Europe (-0.9%)
improved (compared with -2% in 1Q 2022), due to strong growth in
Poland (+3.4%) and Belgium (+4%) and the recovery under way in
Spain (-4%).
- Africa & Middle
East (+7.2%) continued to deliver strong growth.
- Enterprise recorded
a decrease (-1.1%), as the structural decline in legacy Voice and
Data activities outweighed the growth drivers of IT &
integration services.
-
EBITDAaL increased 0.5% in 2Q 2022 (+4.5%
excluding co-financing). The EBITDAaL margin from telecom
activities grew for the second consecutive quarter.EBITDAaL
increased by 0.7% in 1H, driven by Africa & Middle East
(+11.6%) and Europe (+0.6%), despite the steep decline in
Enterprise (-25.3%). France, which decreased by 0.9% overall,
recorded growth of 3.6% excluding co-financing. In line with our
year-end targets, EBITDAaL growth is expected to accelerate in 2H,
mainly due to the reversal of underlying effects (co-financing and
the employee shareholding program).
-
Operating income was +2,420 million euros at 30
June 2022 (compared with an operating loss of -1,752 million euros
on a historical basis at 30 June 2021, due to the effects of the
goodwill impairment in Spain).
- Consolidated
net income was 1,467 million euros, up 4,071
million euros on a historical basis. Excluding the goodwill
impairment in Spain, it would still be up 369 million euros.
-
eCAPEX decreased 11.1% in 2Q 2022. In 1H as a
whole, eCapex reached 3,413 million euros, confirming the decrease,
albeit of a lesser magnitude, expected for the year.
-
Organic cash flow from telecom
activities grew strongly, reaching 1,445 million euros at 30 June
2022 (+605 million euros compared with 30 June 2021 on a historical
basis).
The Group has again confirmed its
financial objectives for 20222, a milestone
towards the achievement of its 2023 commitments:
- A 2.5% to 3%
increase in EBITDAaL
- eCAPEX no
greater than 7.4 billion euros
- Organic cash
flow from telecom activities of at least 2.9 billion euros
- Ratio of net
debt to EBITDAaL from telecom activities unchanged at around 2x in
the medium term
Orange will make an interim
dividend cash payment for 2022 of 0.30 euros on 7
December 2022.
A dividend of 0.70 euros per share for the 2022
fiscal year will be proposed to the 2023 Shareholders’ Meeting.
Commenting on the publication of these results,
Christel Heydemann, Chief Executive Officer of the Orange group,
said:
“In an environment still marked by the health
crisis, geopolitical uncertainty and the effects of inflation,
Orange has once again proven its resilience in the first half of
2022 both in terms of commercial momentum and in respect of its
main financial indicators.
I would above all like to give my thanks to the
Group’s women and men, based across the world, as it is due to
their daily commitment and their ongoing efforts that we have
collectively achieved the results presented today.
This solid performance allows us to confirm our
guidance for the current year, a milestone as we move towards the
delivery of our 2023 commitments. It also allows us to prepare for
the future with confidence and responsibility as we work on our
next strategic plan, which will be unveiled at the beginning of
2023.
I’d particularly like to underline the
resilience of our EBITDAaL which grew 0.5% in the quarter but was
up 4.5% year on year excluding the comparative effect related to
co-financing in 2021. This trend reflects the validity of our “more
for more” commercial strategy by which we offer our customers an
augmented connectivity experience while ensuring accessible offers
for all.
In Spain in recent quarters we have felt the
effects of extreme competition in the telecoms market and of an
especially challenging economic environment. It is particularly
satisfying to note improved customer satisfaction and a reduction
in churn. Our retail market revenues and EBITDAaL are improving,
and we’re on track for a return to growth in 2023. Moreover, the
historic agreement we signed last week with MasMovil to combine our
activities in a new joint venture gives us plenty of reason to
believe in the growth potential of Spain.
In other markets the trend is similar. In
France, fiber and 5G continue to be attractive to our customers and
contribute to the stabilisation of our financial performance.
Africa and Middle East maintained its momentum, with strong growth
in EBITDAaL of 11.6% over the first half, a performance fuelled by
growing demand for mobile data, the development of the Enterprise
market and an increased appetite for fiber.
Our solid retail market performance in Europe
and Africa and Middle East have compensated for the difficulties
that have weighed on our Enterprise business. The turnaround of
this segment is a priority for the Group and we are fully mobilised
to take the actions necessary to return to a path of profitable
growth in this sector.”
Comments on Group key
figures
Revenues
Orange group revenues totaled
21,297 million euros in the first half of 2022, a rise of 0.1%
year on year (+25 million euros). This growth was driven by
retail services3, which increased 2.0%
(+300 million euros), and equipment sales,
which rose 3.4% (+49 million euros) even as
Wholesale services, which were
affected by lower co-financing and the decrease in the regulated
rate for low margin call terminations, decreased 9%
(-360 million euros).
Africa & Middle East was again the main
contributor to this growth, with a year-on-year increase of 7.9%
(+248 million euros). Europe excluding Spain4 also grew
slightly, up 0.8% (+24 million euros), while Totem recorded
growth of 10.2% (+30 million euros).
Revenues in France decreased 1.7%
(-153 million euros) due to the lower co-financing received.
Spain's decline slowed (-4.3%) thanks to the recovery plan.
Growth in the customer
base5
There were 11.6 million convergent
customers Group-wide at 30 June 2022, up 1.2% year on
year.
Mobile services had
235.7 million accesses at 30 June 2022, an increase of 6% year
on year, including 90.1 million contracts, an increase of 8.5%
year on year.
Fixed services totaled
45.9 million accesses at 30 June 2022 (down 2% year on year),
including 13.2 million very high-speed broadband accesses,
which continued their strong growth (+18% year on year). Fixed
narrowband accesses were down 13.4% year on year.
Mobile Financial Services had
1.9 million customers in Europe and 0.8 million customers
in Africa.
EBITDAaL
Group EBITDAaL stood at
5,934 million euros at 30 June 2022 (+0.7%). Excluding
co-financing, EBITDAaL grew 3% in the first six months of the year.
Africa & Middle East was again the primary contributor to this
performance, with double-digit growth of 11.6% year on year,
offsetting the steep decline of 25.3% in Enterprise, which is a
priority area for the Group to address.
At 30 June 2022, cumulative net savings of close
to 450 million euros were achieved compared with 2019, in line
with the roadmap, from the scope defined when the Scale Up6
operational efficiency program was launched. These savings were
mainly due to the ongoing transformation of operational
processes.
An acceleration in this growth trend is still
expected in the second half of the year due to the favorable
underlying effect of the employee shareholding program, which
weighed heavily on EBITDAaL in the final quarter of 2021. The Group
therefore remains confident that it will meet its EBITDAaL growth
target of 2.5% to 3% for the full year 2022.
EBITDAaL from telecom
activities was 5,989 million euros (+0.7%). The
EBITDAaL margin from telecom activities increased for the second
consecutive quarter, rising by 31 basis points in the
second quarter, that is to say by 17 basis points over
the half-year.
Operating income
In the first half of the year, the Group’s
operating income rose to 2,420 million euros,
compared with a loss of 1,752 million euros at 30 June 2021 on
a historical basis. The first half of 2021 had been affected by the
recognition of 3,702 million euros of goodwill impairment in
Spain.
Net income
Orange’s consolidated net
income at 30 June 2022 was 1,467 million euros,
compared with a loss of 2,605 million euros at 30 June 2021 on
a historical basis. This increase mainly reflected the increase in
operating income.
eCAPEX
Group eCAPEX amounted to
3,413 million euros in the first half of 2022, down 8.7% year
on year due to the catch-up effect in the first half of 2021. This
trend is in line with the objective of keeping eCAPEX below
7.4 billion euros for the full year 2022.
At June 30, 2022, Orange had
60.6 million households connectable to FTTH worldwide (up
16.1% year on year), including 31.2 million in France
(+19.5%), where the FTTH customer base increased by 24.4%.
Organic cash flow
Organic cash
flow from telecom
activities at 30 June 2022 amounted to 1,445 million
euros, compared with 840 million euros (on a historical basis)
at 30 June 2021, mainly due to the marked decrease in eCAPEX.
Organic cash flow generation will be relatively linear in 2022.
Changes in the asset
portfolio
There was no material change in the asset
portfolio in the second quarter of 2022.
Following the exclusive negotiations that began
in March 2022, Orange and MásMóvil signed an agreement on
July 22 to combine their Spanish activities. This will take
the form of a joint venture co-controlled by Orange and MásMóvil
with equal governance rights. The transaction is based on an
enterprise value of 18.6 billion euros. It has been submitted
to the competent administrative authorities for approval and is
expected to close during the second half of 2023 at the latest.
Net financial debt
Net debt was almost stable (+0.1 billion
euros compared with 31 December 2021). The generation of
organic cash flow covers principally the payment of the dividend
balance in June and disbursements related to frequency fees.
The ratio of “net financial debt to EBITDAaL
from telecom activities” was 1.91x at 30 June 2022, in line with
the medium-term target of approximately 2x.
__________________________________________________________________________________
The Board of Directors of Orange SA met on
27 July 2022 to review the condensed interim consolidated Financial
Statements and the interim management report for the first half of
2022.
More detailed information on the Group’s
financial results and performance indicators is available on the
Orange website at www.orange.com/en/consolidated-results. Review by
operating segment
France
In millions of euros |
|
2Q 2022 |
changecomparablebasis |
changehistoricalbasis |
|
6M 2022 |
changecomparablebasis |
changehistoricalbasis |
Revenues |
|
4,440 |
(2.7)% |
(2.3)% |
|
8,827 |
(1.7)% |
(1.4)% |
Retail services (B2C+B2B) |
|
2,733 |
1.4 % |
1.4 % |
|
5,466 |
1.6 % |
1.6 % |
Convergence |
|
1,202 |
3.3 % |
3.3 % |
|
2,406 |
3.8 % |
3.8 % |
Mobile-only |
|
583 |
3.5 % |
3.5 % |
|
1,154 |
2.8 % |
2.8 % |
Fixed-only |
|
948 |
(2.1)% |
(2.1)% |
|
1,907 |
(1.9)% |
(1.9)% |
Wholesale |
|
1,260 |
(11.9)% |
(12.1)% |
|
2,455 |
(9.4)% |
(9.7)% |
Equipment sales |
|
267 |
2.1 % |
5.3 % |
|
552 |
2.7 % |
5.7 % |
Other revenues |
|
180 |
1.5 % |
10.2 % |
|
353 |
1.1 % |
8.6 % |
EBITDAaL |
|
|
|
|
|
3,035 |
(0.9)% |
(4.6)% |
EBITDAaL / Revenues |
|
|
|
|
|
34.4 % |
0.3 pt |
(1.2 pt) |
Operating Income |
|
|
|
|
|
1,436 |
(3.0)% |
(7.3)% |
eCAPEX |
|
|
|
|
|
1,673 |
(16.5)% |
(22.9)% |
eCAPEX / Revenues |
|
|
|
|
|
19.0 % |
(3.4 pt) |
(5.3 pt) |
Increase in the EBITDAaL
margin
Revenues decreased 2.7% in the
second quarter reflecting the lower level of co-financing received
in the period. Excluding co-financing, revenues were stable.
Retail services continued to
register solid growth in revenues which rose 1.4% year on year, or
3.4% excluding PSTN7, driven by very strong commercial
performances, in particular increased net additions in
mobile, excluding M2M, of 173,000 (compared to
+142,000 in the second quarter of 2021), propelled principally by
the Orange brand and the increasingly widespread use of Airbox
services.
The fixed-line market normalized after the major
surge caused by the widespread adoption of teleworking. This was
reflected in our 26,000 fixed-line net additions, which continued
to be buoyed by higher fiber volumes than in 2019,
with +263,000 net additions (compared with +353,000 in the second
quarter of 2021).
Due to the price premiums of 5G and fiber, all
ARPOs increased year on year: +15 euro cents for mobile-only
services, +31 euro cents for fixed-only services and
+1.41 euros for convergent services. The new premium Livebox
Max service, which was launched in April, already accounts for 15%
of fixed-line customer acquisitions. The level of customer
satisfaction was further strengthened this quarter, as demonstrated
by the continued improvement in the Net Promoter Score and by lower
churn rates in mobile and fixed for both individual and business
customers.
The EBITDAaL margin grew 0.3 points in the
first half of the year, reflecting our efforts to contain costs and
the decrease in revenues from the wholesale business where the
margin is very low. The evolution of EBITDAaL in
France over the first half of the year (-0.9% or +3.6% excluding
co-financing, year on year) should enable it to move closer to
stability for the full year 2022.
Lastly, eCAPEX decreased
markedly, despite the adverse underlying effect of co-financing,
because Orange France has already achieved more than 90% of its
2023 fiber network roll-out targets.
Europe
In millions of euros |
|
2Q 2022 |
changecomparablebasis |
changehistoricalbasis |
|
6M 2022 |
changecomparablebasis |
changehistoricalbasis |
Revenues |
|
2,677 |
(0.9)% |
3.7 % |
|
5,325 |
(1.5)% |
3.1 % |
Retail services (B2C+B2B) |
|
1,832 |
1.3 % |
6.2 % |
|
3,642 |
0.6 % |
5.5 % |
Convergence |
|
701 |
3.1 % |
4.4 % |
|
1,400 |
3.4 % |
4.7 % |
Mobile-only |
|
714 |
(0.6)% |
(0.2)% |
|
1,414 |
(1.7)% |
(1.4)% |
Fixed-only |
|
305 |
(3.4)% |
18.9 % |
|
614 |
(4.3)% |
17.7 % |
IT & Integration services |
|
112 |
17.7 % |
38.5 % |
|
214 |
15.4 % |
35.7 % |
Wholesale |
|
445 |
(11.9)% |
(5.7)% |
|
877 |
(11.4)% |
(5.3)% |
Equipment sales |
|
355 |
0.7 % |
1.7 % |
|
719 |
(1.0)% |
0.2 % |
Other revenues |
|
45 |
23.6 % |
24.8 % |
|
87 |
23.7 % |
24.6 % |
EBITDAaL |
|
|
|
|
|
1,323 |
0.6 % |
(2.6)% |
EBITDAaL / Revenues |
|
|
|
|
|
24.8 % |
0.5 pt |
(1.5 pt) |
Operating Income |
|
|
|
|
|
260 |
na |
na |
eCAPEX |
|
|
|
|
|
835 |
(4.0)% |
(4.1)% |
eCAPEX / Revenues |
|
|
|
|
|
15.7 % |
(0.4 pt) |
(1.2 pt) |
Retail services return to
growth
Revenues in Europe decreased
0.9% in the second quarter (compared with -2.0% in the first
quarter). The positive trend in retail services
continued, with a return to growth (+1.3%) for the first time since
the first quarter of 2019, again driven by convergence (+3.1%), IT
& integration services in Poland (+29.3%) and the recovery in
roaming customers (+52.7%).
The decrease in wholesale
revenues (-11.9%) primarily reflects the regulatory decrease in
call terminations and the decline in international traffic, which
had a limited impact on margins.
In the first half of the year,
EBITDAaL increased 0.6%, due to the continued
improvement in Spain (-6.7% year on year, compared with -9% in the
second half of 2021) and the excellent performance of Other
European countries (+6.1%). The positive trend in retail services,
the recovery in roaming and the measures taken (price increases and
strict cost management) have enabled EBITDAaL to grow while
improving the margin (+0.5 points year on year).
In Spain, revenues decreased
4.0% in the second quarter. The recovery plan continues to bear
fruit, with ongoing improvement in revenues from retail services
(-2.1%, compared with -4% in 1Q), due to the return to growth of
the convergent ARPO, which offset the decline in low-margin
international traffic and the decrease in equipment sales
(-7.8%).
In an environment that remained intensely
competitive, efforts targeting customer satisfaction have again
reduced the customer churn rate and increased the convergent Net
Promoter Score, while a disciplined commercial strategy was
maintained.
EBITDAaL remained negative in the first half of
the year, but continued to improve (-6.7%, compared with -16.2% in
1H 2021 and -9% in 2H 2021), supported by improvement in retail
services and efforts on costs. Despite high inflation, this
momentum reaffirms the objective of a return to growth in organic
cash flow in 2022 and EBITDAaL in 2023.
Africa & Middle East
In millions of euros |
|
2Q 2022 |
changecomparablebasis |
changehistoricalbasis |
|
6M 2022 |
changecomparablebasis |
changehistoricalbasis |
Revenues |
|
1,713 |
7.2 % |
10.2 % |
|
3,381 |
7.9 % |
11.1 % |
Retail services (B2C+B2B) |
|
1,521 |
8.6 % |
11.9 % |
|
2,984 |
8.9 % |
12.2 % |
Mobile-only |
|
1,313 |
7.4 % |
10.2 % |
|
2,578 |
7.9 % |
10.7 % |
Fixed-only |
|
196 |
14.1 % |
24.2 % |
|
384 |
12.9 % |
20.9 % |
IT & Integration services |
|
12 |
70.5 % |
33.1 % |
|
21 |
96.5 % |
57.2 % |
Wholesale |
|
158 |
(0.8)% |
0.8 % |
|
324 |
1.9 % |
4.4 % |
Equipment sales |
|
24 |
(17.0)% |
(19.2)% |
|
55 |
(0.8)% |
1.6 % |
Other revenues |
|
10 |
8.3 % |
7.9 % |
|
18 |
(1.4)% |
(0.1)% |
EBITDAaL |
|
|
|
|
|
1,214 |
11.6 % |
15.5 % |
EBITDAaL / Revenues |
|
|
|
|
|
35.9 % |
1.2 pt |
1.4 pt |
Operating Income |
|
|
|
|
|
739 |
22.4 % |
27.7 % |
eCAPEX |
|
|
|
|
|
609 |
12.7 % |
16.1 % |
eCAPEX / Revenues |
|
|
|
|
|
18.0 % |
0.8 pt |
0.8 pt |
Excellent performance
continues
The strong growth in revenues
in Africa & Middle East in the second quarter of 2022 (+7.2%)
was fueled by the growth drivers (mobile Data +21.3%, fixed
broadband +27.6% and B2B +12.4%). This increase was underpinned by
both a volume effect, with an increase of more than 20% in the 4G
(+28.3%) and Fixed Broadband (+23.6%) customer bases, and a value
effect. The decrease in Orange Money slowed (-22.5%, compared with
-25.1% in the first quarter) as a result of the response plan,
which has made it possible to continue to grow the active customer
base and the value of transactions registered through Orange
Money.
EBITDAaL grew strongly in the
first half of the year, up 11.6%, while the margin increased
1.2 points compared with the first half of 2021, reflecting
good discipline on costs, particularly in a context of rising
inflation. EBITDAaL has grown more rapidly than revenues in the
last ten consecutive quarters.
This growth trend was supported by the entire
geographical region: 9 countries out of 16 registered double-digit
growth in EBITDAaL.
Enterprise
In millions of euros |
|
2Q 2022 |
changecomparablebasis |
changehistoricalbasis |
|
6M 2022 |
changecomparablebasis |
changehistoricalbasis |
Revenues |
|
1,943 |
(1.1)% |
0.6 % |
|
3,888 |
(0.2)% |
1.3 % |
Fixed-only |
|
862 |
(7.6)% |
(5.9)% |
|
1,738 |
(6.8)% |
(5.2)% |
Voice |
|
252 |
(11.0)% |
(10.4)% |
|
514 |
(10.3)% |
(9.7)% |
Data |
|
611 |
(6.1)% |
(3.9)% |
|
1,224 |
(5.2)% |
(3.2)% |
IT & Integration services |
|
845 |
4.1 % |
6.2 % |
|
1,663 |
4.6 % |
6.2 % |
Mobile |
|
236 |
7.0 % |
7.0 % |
|
487 |
10.6 % |
10.6 % |
Mobile-only |
|
167 |
3.3 % |
3.3 % |
|
325 |
2.2 % |
2.2 % |
Wholesale |
|
10 |
4.0 % |
4.0 % |
|
20 |
(4.3)% |
(4.3)% |
Equipment sales |
|
59 |
19.8 % |
19.8 % |
|
141 |
40.4 % |
40.4 % |
EBITDAaL |
|
|
|
|
|
364 |
(25.3)% |
(24.7)% |
EBITDAaL / Revenues |
|
|
|
|
|
9.4 % |
(3.1 pt) |
(3.2 pt) |
Operating Income |
|
|
|
|
|
152 |
(49.3)% |
(48.5)% |
eCAPEX |
|
|
|
|
|
144 |
(9.6)% |
(8.1)% |
eCAPEX / Revenues |
|
|
|
|
|
3.7 % |
(0.4 pt) |
(0.4 pt) |
A significant decrease in EBITDAaL, with
recovery a priority
Enterprise revenues decreased
by 1.1% in the second quarter, due to the ongoing structural
decrease in fixed services, particularly voice
services (-11%). The decline in legacy activities was largely
offset by growth in mobile, driven in particular
by a contract for mobile terminal equipment signed with the French
Ministry of the Interior, and IT
& integration services.
In the first half of the year, IT &
integration services accounted for approaching 43% of revenues,
mainly due to sustained growth in Cloud (+15%), Digital & Data
(+8%) and Cybersecurity (+13%) services.
The marked decrease in EBITDAaL
in the first half of the year (-25.3%) was due to the accelerated
decline in voice and data services, which was not offset by growth
drivers. Added to this were economic difficulties such as the war
in Ukraine and wage inflation in growth activities.
Adapting Enterprise to the profound changes in
the market is a priority. Some measures have already been taken and
should generate results in the second half of 2022, when the
decline in EBITDAaL is expected to halve compared to the first half
of the year. More profound changes will be implemented in the next
twelve months by the new management.
Totem8
In millions of euros |
|
2Q 2022 |
changecomparablebasis |
changehistoricalbasis |
|
6M 2022 |
changecomparablebasis |
changehistoricalbasis |
Revenues |
|
167 |
8.4 % |
- |
|
328 |
10.2 % |
- |
Wholesale |
|
167 |
8.4 % |
- |
|
328 |
10.2 % |
- |
Other revenues |
|
- |
- |
- |
|
- |
- |
- |
EBITDAaL |
|
|
|
|
|
180 |
1.8 % |
- |
EBITDAaL / Revenues |
|
|
|
|
|
54.8 % |
(4.5 pt) |
- |
Operating Income |
|
|
|
|
|
120 |
(0.6)% |
- |
eCAPEX |
|
|
|
|
|
44 |
7.0 % |
- |
eCAPEX / Revenues |
|
|
|
|
|
13.4 % |
(0.4 pt) |
- |
Totem revenues grew 8.4% in the second quarter
of 2022 (+13 million euros). The hosting activities that
contribute to EBITDAaL grew by 2.8% (after growth of 3.3% in the
first quarter), driven by third-party revenue growth of 7.2%.
The limited increase in EBITDAaL in the first
half of the year (+1.8%) was due to the costs of establishing the
new organization.
The number of sites and the colocation ratio
remained relatively stable, but Totem’s first commercial successes
have confirmed both the appetite of competitors for its hosting
offer in France and Spain alike, as well as its expertise in
complex network architecture in highly constrained settings, such
as the 15 South line on the Greater Paris metro.
International Carriers & Shared
Services
In millions of euros |
|
2Q 2022 |
changecomparablebasis |
changehistoricalbasis |
|
6M 2022 |
changecomparablebasis |
changehistoricalbasis |
Revenues |
|
390 |
3.2 % |
3.1 % |
|
772 |
4.0 % |
3.9 % |
Wholesale |
|
277 |
3.2 % |
3.6 % |
|
539 |
2.8 % |
3.1 % |
Other revenues |
|
114 |
3.1 % |
1.8 % |
|
234 |
7.1 % |
5.8 % |
EBITDAaL |
|
|
|
|
|
(128) |
30.4 % |
29.9 % |
EBITDAaL / Revenues |
|
|
|
|
|
(16.5)% |
8.2 pt |
8.0 pt |
Operating Income |
|
|
|
|
|
(207) |
59.7 % |
59.7 % |
eCAPEX |
|
|
|
|
|
94 |
(14.5)% |
(14.5)% |
eCAPEX / Revenues |
|
|
|
|
|
12.2 % |
(2.6 pt) |
(2.6 pt) |
Revenues from International Carriers and Shared
Services grew by 3.2% in the second quarter. Services to
international carriers continued to benefit from the recovery in
international mobile services. The growth recorded in other
revenues is mainly due to Orange Marine’s submarine cable laying
activities.
In the first half of the year, this segment
significantly reduced its losses, with an improvement in EBITDAaL
of 30.4%, resulting in a loss of 128 million euros, driven by
growth in operating revenues and a reduction in labor costs for
central functions.
Mobile Financial Services
In millions of euros |
|
|
|
|
|
6M 2022 |
changecomparablebasis |
changehistoricalbasis |
Net Banking Income (NBI) |
|
|
|
|
|
56 |
5.1 % |
5.1 % |
Cost of bank credit risk |
|
|
|
|
|
(22) |
50.4 % |
50.4 % |
Operating Income |
|
|
|
|
|
(80) |
(3.6)% |
(3.6)% |
eCAPEX |
|
|
|
|
|
14 |
8.2 % |
8.2 % |
Mobile Financial Services had 2.7 million
customers at 30 June 2022 (including 1.9 million in Europe and
0.8 million in Africa), an increase of 0.6 million year on
year.
Net banking income (NBI) increased 5.1% in the
first half of the year.
EBITDAaL improved 0.6%, despite the increased
cost of risk due to the expansion of the credit business.
In France, Orange Bank continued to enhance its
user experience and was awarded “Excellent” status by the
Trustpilot review platform in the first half of 2022.
Calendar of upcoming events
25 October 2022
- Publication of
3rd quarter 2022 results
Contacts
press: Sylvain Brunosylvain.bruno@orange.com Tom
Wrighttom.wright@orange.com |
financial communication: (analysts and investors)Patrice Lambert-de
Diesbachp.lambert@orange.com Aurélia
Rousselaurelia.roussel@orange.comLouise
Racinelouise.racine@orange.comHong Hai
Vuonghonghai.vuong@orange.com |
Disclaimer
This press release 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 us or not
currently considered material by us, and there can be no assurance
that anticipated events will occur or that the objectives set out
will actually be achieved. More detailed information on the
potential risks that could affect our financial results is included
in the Universal Registration Document filed on 31 March 2022
with the French Financial Markets Authority (AMF) and in the annual
report (Form 20-F) filed on 1st April 2022 with the U.S. Securities
and Exchange Commission. Forward-looking statements speak only as
of the date they are made. Other than as required by law, Orange
does not undertake any obligation to update them in light of new
information or future developments.
Appendix 1: financial key
indicators
Quarterly data
In millions of euros |
|
2Q 2022 |
2Q 2021comparablebasis |
2Q 2021historicalbasis |
variationcomparablebasis |
changehistoricalbasis |
Revenues |
|
10,715 |
10,761 |
10,551 |
(0.4)% |
1.6 % |
France |
|
4,440 |
4,564 |
4,546 |
(2.7)% |
(2.3)% |
Europe |
|
2,677 |
2,702 |
2,581 |
(0.9)% |
3.7 % |
Africa & Middle East |
|
1,713 |
1,598 |
1,555 |
7.2 % |
10.2 % |
Enterprise |
|
1,943 |
1,965 |
1,932 |
(1.1)% |
0.6 % |
Totem |
|
167 |
154 |
- |
8.4 % |
- |
International Carriers & Shared Services |
|
390 |
379 |
379 |
3.2 % |
3.1 % |
Intra-Group eliminations |
|
(616) |
(601) |
(441) |
|
|
EBITDAaL (1) |
|
3,314 |
3,296 |
3,272 |
0.5 % |
1.3 % |
o/w Telecom activities |
|
3,343 |
3,324 |
3,300 |
0.6 % |
1.3 % |
As % of revenues |
|
31.2 % |
30.9 % |
31.3 % |
0.3 pt |
(0.1 pt) |
o/w Mobile Financial Services |
|
(30) |
(28) |
(28) |
(4.2)% |
(4.2)% |
eCAPEX |
|
1,803 |
2,029 |
2,085 |
(11.1)% |
(13.5)% |
o/w Telecom activities |
|
1,795 |
2,022 |
2,079 |
(11.2)% |
(13.6)% |
as % of revenues |
|
16.8 % |
18.8 % |
19.7 % |
(2.0 pt) |
(2.9 pt) |
o/w Mobile Financial Services |
|
8 |
6 |
6 |
22.9 % |
22.9 % |
EBITDAaL - eCAPEX |
|
1,511 |
1,267 |
1,187 |
19.2 % |
27.2 % |
(1) EBITDAaL presentation adjustments
are described in Appendix 2.
30 June data
In millions of euros |
|
6M 2022 |
6M 2021comparablebasis |
6M 2021historicalbasis |
variationcomparablebasis |
changehistoricalbasis |
Revenues |
|
21,297 |
21,272 |
20,867 |
0.1 % |
2.1 % |
France |
|
8,827 |
8,979 |
8,950 |
(1.7)% |
(1.4)% |
Europe |
|
5,325 |
5,406 |
5,164 |
(1.5)% |
3.1 % |
Africa & Middle East |
|
3,381 |
3,133 |
3,043 |
7.9 % |
11.1 % |
Enterprise |
|
3,888 |
3,895 |
3,840 |
(0.2)% |
1.3 % |
Totem |
|
328 |
298 |
- |
10.2 % |
- |
International Carriers & Shared Services |
|
772 |
742 |
743 |
4.0 % |
3.9 % |
Intra-Group eliminations |
|
(1,224) |
(1,180) |
(873) |
|
|
EBITDAaL (1) |
|
5,934 |
5,891 |
5,837 |
0.7 % |
1.7 % |
o/w Telecom activities |
|
5,989 |
5,947 |
5,893 |
0.7 % |
1.6 % |
As % of revenues |
|
28.1 % |
28.0 % |
28.2 % |
0.2 pt |
(0.1 pt) |
France |
|
3,035 |
3,063 |
3,181 |
(0.9)% |
(4.6)% |
Europe |
|
1,323 |
1,315 |
1,359 |
0.6 % |
(2.6)% |
Africa & Middle East |
|
1,214 |
1,088 |
1,051 |
11.6 % |
15.5 % |
Enterprise |
|
364 |
488 |
484 |
(25.3)% |
(24.7)% |
Totem |
|
180 |
177 |
- |
1.8 % |
- |
International Carriers & Shared Services |
|
(128) |
(184) |
(182) |
30.4 % |
29.9 % |
o/w Mobile Financial Services |
|
(56) |
(56) |
(56) |
0.6 % |
0.6 % |
Operating Income |
|
2,420 |
(1,722) |
(1,752) |
na |
na |
o/w Telecom activities |
|
2,499 |
(1,646) |
(1,676) |
na |
na |
o/w Mobile Financial Services |
|
(80) |
(77) |
(77) |
(3.6)% |
(3.6)% |
Consolidated net income |
|
1,467 |
|
(2,605) |
- |
na |
Net income attributable to equity owners of the Group |
|
1,218 |
|
(2,769) |
|
na |
eCAPEX |
|
3,413 |
3,737 |
3,845 |
(8.7)% |
(11.3)% |
o/w Telecom activities |
|
3,399 |
3,724 |
3,832 |
(8.7)% |
(11.3)% |
as % of revenues |
|
16.0 % |
17.5 % |
18.4 % |
(1.5 pt) |
(2.4 pt) |
o/w Mobile Financial Services |
|
14 |
13 |
13 |
8.2 % |
8.2 % |
EBITDAaL - eCAPEX |
|
2,521 |
2,154 |
1,992 |
17.0 % |
26.6 % |
Organic cash-flow (telecom activities) |
|
1,445 |
|
840 |
|
72.1 % |
(1) EBITDAaL presentation adjustments
are described in Appendix 2.
In millions of euros |
|
June 302022 |
December 31.2021 |
Net financial debt (1) |
|
24,377 |
24,269 |
Ratio of financial debt / EBITDAaL from telecom activities
(2) |
|
1.91 |
1.91 |
(1) Net financial debt as defined and
used by Orange does not include Mobile Financial Services
activities, for which this concept is not relevant.
(2) The ratio of net financial debt
to EBITDAaL from telecom activities is calculated based on the
ratio of the Group’s net financial debt to EBITDAaL from telecom
activities over the previous 12 months.
Appendix 2: adjusted data to income
statement items
Quarterly data
|
|
2Q 2022 |
|
2Q 2021historical basis |
In millions of euros |
|
Adjusted data, |
Presentation adjustments, |
Income statement, |
|
Adjusted data, |
Presentation adjustments, |
Income statement, |
Revenues |
|
10,715 |
- |
10,715 |
|
10,551 |
- |
10,551 |
External purchases |
|
(4,543) |
(4) |
(4,547) |
|
(4,391) |
(1) |
(4,392) |
Other operating income |
|
181 |
0 |
181 |
|
176 |
- |
176 |
Other operating expense |
|
(95) |
(8) |
(103) |
|
(127) |
(11) |
(138) |
Labor expenses |
|
(2,166) |
70 |
(2,096) |
|
(2,205) |
(17) |
(2,222) |
Operating taxes and levies |
|
(340) |
3 |
(338) |
|
(307) |
(31) |
(338) |
Gains (losses) on disposal of fixed assets, investments and
activities |
|
na |
25 |
25 |
|
na |
5 |
5 |
Restructuring costs |
|
na |
(16) |
(16) |
|
na |
(139) |
(139) |
Depreciation and amortization of financed assets |
|
(25) |
- |
(25) |
|
(21) |
- |
(21) |
Depreciation and amortization of right-of-use assets |
|
(382) |
- |
(382) |
|
(372) |
- |
(372) |
Impairment of right-of-use assets |
|
- |
6 |
6 |
|
- |
(60) |
(60) |
Interests expenses on liabilities related to financed assets |
|
(0) |
0 |
na |
|
(0) |
0 |
na |
Interests expenses on lease liabilities |
|
(32) |
32 |
na |
|
(31) |
31 |
na |
EBITDAaL |
|
3,314 |
108 |
na |
|
3,272 |
(222) |
na |
Significant litigation |
|
1 |
(1) |
na |
|
(35) |
35 |
na |
Specific labor expenses |
|
71 |
(71) |
na |
|
(14) |
14 |
na |
Fixed assets, investments and business portfolio review |
|
25 |
(25) |
na |
|
5 |
(5) |
na |
Restructuring program costs |
|
(11) |
11 |
na |
|
(199) |
199 |
na |
Acquisition and integration costs |
|
(12) |
12 |
na |
|
(11) |
11 |
na |
Interests expenses on liabilities related to financed assets |
|
na |
(0) |
(0) |
|
na |
(0) |
(0) |
Interests expenses on lease liabilities |
|
na |
(32) |
(32) |
|
na |
(31) |
(31) |
30 June data
|
|
6M 2022 |
|
6M 2021historical basis |
In millions of euros |
|
Adjusted data, |
Presentation adjustments, |
Income statement, |
|
Adjusted data, |
Presentation adjustments, |
Income statement, |
Revenues |
|
21,297 |
- |
21,297 |
|
20,867 |
- |
20,867 |
External purchases |
|
(9,039) |
(11) |
(9,050) |
|
(8,733) |
(4) |
(8,736) |
Other operating income |
|
366 |
0 |
366 |
|
322 |
- |
322 |
Other operating expense |
|
(222) |
(9) |
(231) |
|
(227) |
(68) |
(295) |
Labor expenses |
|
(4,361) |
33 |
(4,329) |
|
(4,373) |
(48) |
(4,421) |
Operating taxes and levies |
|
(1,235) |
0 |
(1,235) |
|
(1,188) |
(31) |
(1,219) |
Gains (losses) on disposal of fixed assets, investments and
activities |
|
na |
36 |
36 |
|
na |
12 |
12 |
Restructuring costs |
|
na |
(47) |
(47) |
|
na |
(245) |
(245) |
Depreciation and amortization of financed assets |
|
(47) |
- |
(47) |
|
(41) |
- |
(41) |
Depreciation and amortization of right-of-use assets |
|
(762) |
- |
(762) |
|
(731) |
- |
(731) |
Impairment of right-of-use assets |
|
(1) |
6 |
5 |
|
- |
(60) |
(60) |
Interests expenses on liabilities related to financed assets |
|
(1) |
1 |
na |
|
(1) |
1 |
na |
Interests expenses on lease liabilities |
|
(61) |
61 |
na |
|
(58) |
58 |
na |
EBITDAaL |
|
5,934 |
70 |
na |
|
5,837 |
(385) |
na |
Significant litigation |
|
(2) |
2 |
na |
|
(89) |
89 |
na |
Specific labor expenses |
|
35 |
(35) |
na |
|
(41) |
41 |
na |
Fixed assets, investments and business portfolio review |
|
36 |
(36) |
na |
|
12 |
(12) |
na |
Restructuring program costs |
|
(41) |
41 |
na |
|
(305) |
305 |
na |
Acquisition and integration costs |
|
(21) |
21 |
na |
|
(20) |
20 |
na |
Interests expenses on liabilities related to financed assets |
|
na |
(1) |
(1) |
|
na |
(1) |
(1) |
Interests expenses on lease liabilities |
|
na |
(61) |
(61) |
|
na |
(58) |
(58) |
Appendix 3: economic CAPEX to
investments in property, plant and intangible
investment
In millions of euros |
|
2Q 2022 |
2Q 2021historicalbasis |
|
6M 2022 |
6M 2021historicalbasis |
eCAPEX |
|
1,803 |
2,085 |
|
3,413 |
3,845 |
Elimination of proceeds from sales of property, plant and equipment
and intangible assets |
|
78 |
29 |
|
124 |
48 |
Telecommunication licenses |
|
30 |
15 |
|
244 |
293 |
Financed assets |
|
39 |
3 |
|
69 |
23 |
Investments in property, plant and equipment and intangible
assets |
|
1,950 |
2,132 |
|
3,850 |
4,208 |
Appendix 4: key performance
indicators
In thousand, at the end of the period |
|
June 302022 |
|
June 302021 |
Number of convergent customers |
|
11,552 |
|
11,418 |
Number of mobile accesses (excluding MVNOs)
(1) |
|
235,746 |
|
222,485 |
o/w |
Convergent customers mobile accesses |
|
21,056 |
|
20,595 |
|
Mobile only accesses |
|
214,690 |
|
201,890 |
o/w |
Contract customers mobile accesses |
|
90,138 |
|
83,046 |
|
Prepaid customers mobile accesses |
|
145,607 |
|
139,439 |
Number of fixed accesses (2) |
|
45,916 |
|
46,831 |
|
Fixed Retail accesses |
|
31,072 |
|
31,377 |
|
|
Fixed Broadband accesses |
|
24,002 |
|
23,214 |
|
|
o/w |
Very high‑speed broadband fixed accesses |
|
13,224 |
|
11,203 |
|
|
|
Convergent customers fixed accesses |
|
11,552 |
|
11,418 |
|
|
|
Fixed accesses only |
|
12,450 |
|
11,796 |
|
|
Fixed Narrowband accesses |
|
7,070 |
|
8,163 |
|
Fixed Wholesale accesses |
|
14,845 |
|
15,453 |
Group total accesses (1+2) |
|
281,662 |
|
269,316 |
2021 data is presented on a comparable
basis.
Key performance indicators (KPI) by country are
presented in the “Orange Investors Databook Q2 2022”, available on
www.orange.com, under Finance/Results:
www.orange.com/en/latest-consolidated-results
Appendix 5: glossary
Key figures
Data on a comparable basis: data based on
comparable accounting principles, scope of consolidation and
exchange rates are presented for previous periods. The transition
from data on an historical basis to data on a comparable basis
consists of keeping the results for the period ended and then
restating the results for the corresponding period of the preceding
year for the purpose of presenting, over comparable periods,
financial data with comparable accounting principles, scope of
consolidation and exchange rate. The method used is to apply to the
data of the corresponding period of the preceding year, the
accounting principles and scope of consolidation for the period
just ended as well as the average exchange rate used for the income
statement for the period ended. Changes in data on a comparable
basis reflect organic business changes. Data on a comparable basis
is not a financial aggregate as defined by IFRS and may not be
comparable to similarly-named indicators used by other
companies.
EBITDAaL or “EBITDA after Leases”: operating
income (i) before depreciation and amortization of fixed assets,
effects resulting from business combinations, reclassification of
cumulative translation adjustment from liquidated entities,
impairment of goodwill and fixed assets, share of profits (losses)
of associates and joint ventures, (ii) after interest on debts
related to financed assets and on lease liabilities, and (iii)
adjusted for significant litigation, specific labor expenses, fixed
assets, investments and businesses portfolio review, restructuring
programs costs, acquisition and integration costs and, where
appropriate, other specific elements. EBITDAaL is not a financial
aggregate as defined by IFRS standards and may not be directly
comparable to similarly-named indicators in other companies.
eCAPEX or “economic CAPEX”: (i) acquisitions of
property, plant and equipment and intangible assets, excluding
telecommunications licenses and financed assets, (ii) less the
price of disposal of property, plant and equipment and intangible
assets. eCAPEX is not a financial performance indicator as defined
by IFRS standards and may not be directly comparable to indicators
referenced by similarly-named indicators in other companies.
Organic Cash Flow (telecoms activities): for the
perimeter of the telecoms activities, net cash provided by
operating activities, minus (i) lease liabilities repayments and
debts related to financed assets repayments, and (ii) purchases and
sales of property, plant and equipment and intangible assets, net
of the change in the fixed assets payables, (iii) excluding effect
of telecommunication licenses paid and significant litigations paid
or received. Organic Cash Flow (telecoms activities) is not a
financial aggregate defined by IFRS and may not be comparable to
similarly-named indicators used by other companies.
Retail services (B2C + B2B): aggregation of
revenues from (i) Convergent services, (ii) Mobile-only services,
(iii) Fixed-only services and (iv) IT & integration services
(see definitions). Retail Services (B2C+B2B) revenues include all
revenues of a given scope excluding revenues from wholesale
services, equipment sales and other revenues (see definitions).
Performance indicators
Fixed retail accesses: number of fixed broadband
accesses (xDSL (ADSL and VDSL), FTTx, cable, Fixed-4G (fLTE) and
other broadband accesses (satellite, Wimax and others)) and fixed
narrowband accesses (mainly PSTN) and payphones.
Fixed wholesale accesses: number of fixed
broadband and narrowband wholesale accesses operated by Orange.
Convergence
Convergent services: customer base and revenues
from B2C Convergent retail offers, excluding equipment sales (see
definition) defined as an offer combining at least a broadband
access (xDSL, FTTx, cable or Fixed-4G (fLTE) with cell-lock) and a
mobile voice contract (excluding MVNOs).
Convergent ARPO: average quarterly revenues per
convergent offer (ARPO) calculated by dividing revenues from retail
Convergent services offers invoiced to B2C customers generated over
the past three months (excluding IFRS 15 adjustments) by the
weighted average number of retail Convergent offers over the same
period. ARPO is expressed by monthly revenues per convergent
offer.
Mobile-only
services
Mobile-only services: revenues from mobile
offers (mainly outgoing calls: voice, SMS and data) invoiced to
retail customers, excluding convergent services and equipment sales
(see definitions). The customer base includes customers with a
contract excluding retail convergence, machine-to-machine contracts
and prepaid cards.
Mobile-only ARPO: average quarterly revenues
from Mobile-only (ARPO) calculated by dividing revenues from
Mobile-only retail services (excluding machine-to-machine and IFRS
15 adjustments) generated over the past three months by the
weighted average of Mobile-only customers (excluding
machine-to-machine) over the same period. The ARPO is expressed as
monthly revenues per Mobile-only customer.
Fixed-only services
Fixed-only services: revenues from fixed retail
offers, excluding B2C convergent offers and equipment sales (see
definitions). It includes (i) fixed narrowband services
(conventional fixed telephony), (ii) fixed broadband services, and
(iii) business solutions and networks (with the exception of
France, for which essential business solutions and networks are
supported by Enterprise). For the Enterprise segment, Fixed-only
service revenues include sales of network equipment related to the
operation of voice and data services. The customer base consists of
fixed narrowband and fixed broadband customers, excluding retail
convergence customers.
Fixed-only Broadband ARPO: average quarterly
revenues from Fixed-only Broadband (ARPO) calculated by dividing
the revenue from Fixed-only Broadband retail services (excluding
IFRS 15 adjustments) generated over the past three months by the
weighted average of Fixed-only Broadband customers over the same
period. ARPO is expressed as monthly revenues per Fixed-only
Broadband customer.
IT &
integration services
IT & integration services: revenues from
unified communication and collaboration services (Local Area
Network and telephony, advising, integration and project
management), hosting and infrastructure services (including Cloud
Computing), applications services (customer relations management
and other applications services), security services, video
conferencing offers, machine-to-machine services (excluded
connectivity) as well as sales of equipment related to the above
products and services.
Wholesale
Wholesale: revenues from other carriers consists
of (i) mobile services to other carriers including incoming
traffic, visitor roaming, network sharing, national roaming and
Mobile Virtual Network Operators (MVNOs), and (ii) fixed services
to other carriers including national networking, services to
international carriers, high-speed and very high-speed broadband
access (fibre access, unbundling of telephone lines and xDSL access
sales) and the sale of telephone lines on the wholesale market.
Equipment sales
Equipment sales: revenues from all mobile and
fixed equipment sales, excluding (i) equipment sales associated
with the supply of IT & integration services, (ii) sales of
network equipment related to the operation of voice and data
services in the Enterprise operating segment, and (iii) equipment
sales to dealers and brokers.
Other revenues
Other revenues: revenues including (i) equipment
sales to brokers and dealers, (ii) portal, (iii) on-line
advertising revenues, (iv) corporate transversal business line
activities, and (v) other miscellaneous revenues.
1 Unless otherwise stated, the changes presented in
this press release are on a comparable basis.2 Excluding pending
external growth transactions3 Services invoiced to customers (B2C +
B2B). See definition in the attached glossary.4 Poland, Belgium and
Luxembourg, Romania, Slovakia and Moldavia (Other European
countries).5 Figures include the customer bases of Orange Romania
Communications (formerly Telekom Romania Communications) acquired
in September 2021. Changes are shown on a comparable basis.6 A
defined scope of 13.8 billion euros, corresponding to the
Group’s indirect costs in 2019 excluding (i) Africa & Middle
East and Mobile Financial Services and (ii) labor expenses, other
network expenses and IT expenses for Enterprise IT &
integration services.
7 Revenues related to the Public Switched Telephone
Network. 8 Totem is the European company within the Orange group
that owns and manages the passive mobile infrastructure portfolio
for telecommunication towers (initially in France and Spain). It
began operating in late 2021. Since 1 January 2022, Totem has been
presented as a new business segment.
- CP_Orange_Q2_2022_EN_280722
Orange (EU:ORA)
Gráfico Histórico do Ativo
De Fev 2024 até Mar 2024
Orange (EU:ORA)
Gráfico Histórico do Ativo
De Mar 2023 até Mar 2024