Orange SA (ORANY) Q3 2024 Earnings Call Highlights: Strong Growth in Retail Services and Middle ...

GuruFocus News
3 min read

In This Article:

  • Revenue: Up 1.6% year on year to EUR10 billion.

  • Retail Services Growth: Increased by 2.5%, offsetting a 3.3% decline in wholesale.

  • Group EBITDA: Grew by 2.7% to EUR3.3 billion.

  • CapEx: Accounted for 14% of sales in Q3.

  • France Revenue Growth: Accelerated to 1.3%.

  • Middle East and Africa Growth: Achieved 10.5% growth, with retail services growing over 11%.

  • Orange Business Revenue: Decreased by 2.6%, with cyber defense up 10%.

  • Mobile Net Adds: Plus 83,000 in Q3.

  • Fixed Broadband Net Adds: Plus 6,000 in Q3.

  • Convergent Revenues: Up by almost 5%.

  • MEA EBITDA minus CapEx Growth: Average growth of 16% between 2019 and 2023.

Release Date: October 24, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Orange SA (ORANY) reported strong Q3 results, confirming their full-year guidance.

  • The Middle East and Africa region delivered its sixth consecutive quarter of double-digit growth.

  • Orange SA (ORANY) successfully demonstrated technological leadership during the Paris 2024 Olympics, enhancing brand image.

  • The company achieved a solid commercial performance in France, with mobile net adds of 83,000 and fixed broadband net adds returning to growth.

  • Convergent revenues increased by almost 5%, driven by robust growth in convergent ARPU and low customer churn.

Negative Points

  • Orange Business revenues decreased by 2.6% due to a decline in voice services and complex IT market conditions.

  • Wholesale revenues continued to decline, impacting overall revenue growth.

  • The competitive environment in France remains challenging, particularly in the low-end mobile market.

  • Orange SA (ORANY) faces risks in the Middle East and Africa, although mitigated by a diversified country portfolio.

  • The company is experiencing a slowdown in IT services growth in Poland, attributed to stagnation in the public sector.

Q & A Highlights

Q: How does Orange view the impact of new convergent tariffs launched by competitors on its growth strategy? A: Christel Heydemann, CEO, stated that convergence is a core pillar of Orange's strategy, focusing on customer retention and churn reduction. The company views competitors' convergent offers positively, as they focus on increasing customer value. Orange maintains the lowest churn in the market and does not see an increase in churn due to these new offers.

Q: Can you explain the recent trends in Orange's convergence base and the strategy moving forward? A: Jean-Francois Fallacher, Executive VP and CEO, noted that the convergence base saw a slight decline in net adds, but the base remains stable. The company launched new convergent offers on October 10 to stabilize the base and enhance customer value through discounts and bundled services.

Recommended Stories