Orange : 2017 earnings

Orange's revenues and adjusted EBITDA grew for the second consecutive year in 2017, while Operating Cash Flow grew for the first time since 2009*.

• In France, revenue grew for the first time since 2009, up 0.6%;
• In Spain, record growth rates achieved, with revenues up 7.1% and adjusted EBITDA up 17.0%*;
• In Africa & the Middle East, revenue growth accelerated to 3.0%*.

This momentum was underpinned by an excellent operational performance in the fourth quarter.

• A record quarter in fibre with 164,000 net sales in France and 175,000 in Spain;
• Orange France recorded 212,000 net sales of mobile contracts in the fourth quarter; approximately double the fourth quarter of 2016, continuing the excellent sales trend of the third quarter;
• Steady growth of retail convergence offers in France and the Europe segment with 10.3 million customers at the end of 2017, up 11.1% on the year;
• Successful launch of Orange Bank with 55,000 accounts opened by 2017 year-end.

2017 CAPEX of 7.2 billion euros supported our strategy of differentiation through investment in our network quality and customer experience. At December 31, 2017, 26.6 million homes were potentially connectable to high-speed broadband , and 4G was rolled out in three new countries, bringing the total to 21 countries.

With confidence in the momentum and financial strength across the Group, the Board of Directors confirms the payment of a 0.65 euro dividend for fiscal year 2017 and will propose at the 2019 Annual General Meeting of Shareholders a dividend payment of 0.70 euro per share for the 2018 fiscal year. The 5 euro cents increase in dividend will be reflected in the interim dividend (0.30euro per share), which is payable in December 2018.
Commenting on the 2017 earnings report, Stéphane Richard, Chairman and CEO of Orange Group, said:

'2017 was a remarkable year for Orange in more ways than one. The Group delivered an excellent commercial performance, driven by very high-speed broadband. We now have 4.7 million fibre customers and 46 million 4G customers across the Group. This performance has translated into solid financial results. Thanks to a strong fourth quarter, revenues in France returned to growth for the first time since 2009. Spain maintained its impressive growth, while our Africa & Middle East segment recovered strong momentum, with 3% revenue growth year on year.

Buoyed by these positive results, the Group's operating cash flow grew for the first time since 2009.

2017 also saw the launch of Orange Bank, which has succeeded in attracting close to 100,000 customers in less than four months. Our expertise in financial services is now recognised and the success of Orange Money, with its 37 million customers, shows no signs of slowing.

This strong performance can be attributed to the significant contribution of the women and men of Orange and I would like to warmly thank them for their commitment.

Our strategy, based on sustainable value creation, is delivering. This has enabled us to reaffirm our objectives for 2018 and to recommend an increase in the 2018 dividend for our shareholders.'

Orange re-affirms the 2018 objectives announced at its Investor Day on December 7:

• growth in adjusted EBITDA greater than that achieved in 2017 on a comparable basis;
• higher CAPEX, peaking at 7.4 billion euros in 2018;
• growth in Operating Cash Flow greater than in 2017 on a comparable basis;
• net debt to adjusted EBITDA for telecom activities to be held at about 2x in the medium term, to maintain Orange's financial strength and investment capacity.

For 2019 and 2020, growth in adjusted EBITDA, decrease in CAPEX and growth in Operating Cash Flow.

The entire press release is available on PDF file

* Data on a comparable basis.
1/ Excluding machine to machine
2/ Download speeds greater than or equal to 100 Mbps.
3/ Subject to the approval of the Annual General Meeting of Shareholders.
4/ These objectives, originally announced on the basis of the financial data presented in accordance with accounting standard IAS 18, are maintained under the application of the new accounting standard IFRS 15 in effect since January 1, 2018. They do not include the effects of IFRS 16, which will take effect on January 1, 2019.