Accelerated EBITDAaL growth confirms the Group’s ability to execute its value strategy.

In line with the target of slight growth in 2024, and thanks to a solid performance in retail services, Group EBITDAaL for the third quarter increased +2.7% to 3,345 million euros (following increases of +2.6% in 2Q and +2.3% in 1Q). EBITDAaL from telecom activities grew to 3,370 million euros (+2.4%).

eCAPEX amounted to 1,359 million euros in the third quarter of 2024, down -2.5% year on year. eCAPEX for telecom activities as a percentage of revenues was 13.6%, in line with the objective of around 15% in 2024. At 30 September 2024, the number of households connectable to FTTH reached 58.7 million excluding Spain (+10.1%), and the FTTH customer base was 13.0 million (+14.2%).

Financial objectives

The Group can therefore confirm its financial targets for 2024⁴:

• Low single-digit growth in EBITDAaL

• Discipline on eCAPEX

• Organic cash flow from telecom activities of at least 3.3 billion euros

• A ratio of net debt/EBITDAaL from telecom activities unchanged at about 2x in the medium term

• On 5 December 2024, Orange will pay an interim dividend in cash of 0.30 euros per share for 2024. Payment of a dividend of 0.75 euros per share in respect of the 2024 fiscal year will be proposed to the Shareholders’ Meeting in 2025.
  
  

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The Board of Directors of Orange SA met on 23 October 2024 and reviewed the consolidated financial results at 30 September 2024.

More detailed information on the Group’s financial results and performance indicators is available on the Orange website www.orange.com/en/finance/investors/consolidated-results.

Review by operating segment

France

Robust performance again supported by increased retail services and a smaller decline in wholesale

With quarterly revenues of 4,496 million euros, France recorded growth of 1.3% year on year (+59 million euros) thanks to the increase in retail services (+1.6% or +45 million euros) and other revenues (+19.9% or +30 million euros). The decline in wholesale services (-1.9% or - 21 million euros) continued, albeit at a slower pace, mainly due to the seasonal nature of visitor roaming. The growth in retail services excluding fixed-only narrowband services (PSTN) was 2.8% (+74 million euros), supported by a good commercial performance.

France continued to improve its performance thanks to a targeted and disciplined sales strategy. France capitalized on the strength of its customer base, the recognized quality of its network, as evidenced by the success of the Olympic Games, and its market-leading Net Promoter Score.

Mobile net additions for the third quarter were +83,000⁵, and the churn rate remained moderate (13.8%). Fixed broadband net additions in the third quarter resumed growth at +6,000, with Fiber retaining its excellent momentum (+259,000) and fixed ARPO on the rise. Convergent net additions were slightly down (-14,000), but this was more than offset by a strong increase in convergent ARPO which rose to 77.7 euros (up 3.9 euros in a year), leading to growth in convergent services of 4.6%. At 30 September 2024, 39.5 million households were connectable to Orange Fiber, representing 90% of French households.

The target of maintaining stable EBITDAaL in France in 2024 is confirmed.

Europe

Solid growth in retail services

Revenues for Europe decreased 2.1% (-38 million euros) in the third quarter because of the decline in wholesale services (-15.5% or -37 million euros) following the regulatory decrease in call termination rates, which had no effect on EBITDAaL. Accelerated growth in retail services (+1.6% or +20 million euros) was offset by the decline in other low-margin activities such as equipment sales (-5.3% or -13 million euros) and other revenues (-17.9% or -7 million euros) related in particular to lower energy resale prices in Poland. Growth in retail services excluding IT and Integration services (+1.3%) was 0.2 points higher than in the second quarter (+1.1%). IT and Integration services grew 4.4%.

The good performance of Convergence (+6.8%) benefited from price increases and growth in the Fixed broadband customer base, which rose to nearly 3.6 million FTTH and cable customers, up 9.9% year on year.

Declines in Mobile and Fixed broadband churn, as well as net additions at an exceptional level of +151,000 in Mobile (primarily B2C), +63,000 in Fiber and +9,000 in very high-speed Fixed broadband reflect the excellent commercial performance.

The forecast of low-to-mid single digit EBITDAaL growth for Europe in 2024 is confirmed.

Africa & Middle East

Outstanding growth continues

Africa & Middle East revenues rose strongly in the third quarter (+182 million euros), with double-digit growth (+10.5%) for the sixth consecutive quarter. Africa & Middle East also posted outstanding growth on a historical basis with revenues up 5.7% in the third quarter.

This performance was underpinned by the continued rapid growth in retail services (+11.3%) thanks to increases from the four growth engines of Mobile data (+18.3%), which accelerated with seven countries up more than 20%, Fixed broadband (+17.2%), Orange Money (+20.7%) and B2B across all activities (+5.8%).

The Mobile customer base reached 160.1 million, a year-on-year increase of 8.2%, with accelerated growth in the 4G customer base (+26.1%) and a +3.6% increase in average Mobile ARPO in the third quarter. The fixed broadband customer base rose 17.8% to 3.8 million. Lastly, Orange Money had 37.1 million active customers, up 17.6%.

The target of double-digit EBITDAaL growth for Africa & Middle East in 2024 is confirmed.

Orange Business

Good progress on the recovery plan

Revenues for the Orange Business segment were 1,860 million euros in the third quarter of 2024, down 2.6% (-50 million euros) due to a decline in Fixed-only revenues (-7.1% or -56 million euros), primarily related to the anticipated decline in voice revenues (-11.6%).

Revenue growth was dynamic for Orange Cyberdefense (+9.7%), while IT and Integration services were stable (+0.5% or +4 million euros) in an IT market under pressure.

Orange Cyberdefense’s expertise in particular has been recognized by ISG, IDC and Omdia.

The voluntary departure plan is currently being implemented.

The Orange Business transformation plan is in line with the objective for the year of halving the decline in EBITDAaL in 2024 compared to the previous year.

TOTEM

The revenues of the TowerCo TOTEM grew 0.8% over the quarter due to the increase in hosting activities (+1.7%) and energy reselling, partly offset by the decrease in revenues from planning and construction work in France.

International Carriers & Shared Services

Wholesale services revenues decreased 6.9% (-16 million euros) in the third quarter. The decline in voice revenues (in volume and price) was partially offset by the increase in services related to the management of data and roaming activities.

Mobile Financial Services

The plan to discontinue Orange Bank’s activities in Europe is ongoing:

• in France, the sale of the loan portfolio has been finalized and the closing of accounts is almost complete;

• the official request to close the operation in Spain was filed with the European Central Bank and Banco de Espa?a on 16 September. The transfer of teams and funds to Banco Cetelem took effect on 1 October.

MASORANGE⁶

In Spain, revenue increased 1.1% in the third quarter, with retail services growth of 1.4%.

MASORANGE achieved 85 million euros in synergies of the about 100 million euros targeted in 2024 and confirms its ambition to achieve at least 500 million euros over the first four years.

Calendar of upcoming events

13 February 2025                - Publication of 2024 financial results

24 April 2025                        - Publication of First Quarter 2025 financial results

Contacts

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 28 March 2024 with the French Financial Markets Authority (AMF) and in the annual report (Form 20-F) filed on 29 March 2024 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

30 September data

Appendix 2: adjusted data to income statement items

Quarterly data

30 September data

Appendix 3: economic CAPEX to investments in property, plant and intangible investment

Quarterly data

30 September data

Appendix 4: key performance indicators

Key performance indicators (KPI) by country are presented in the "Orange investors data book Q3 2024" 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.

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).

EBITDAaL or “EBITDA after Leases”: operating income (i) before depreciation and amortization of fixed assets, effects resulting from business combinations, 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 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.

Free cash flow all-in (telecoms activities): Free cash flow all-in from telecom activities corresponds to net cash provided by operating activities, minus (i) purchases and sales of property, plant and equipment and intangible assets, net of the change in the fixed assets payables, (ii) repayments of lease liabilities and on debts related to financed assets, and (iii) payments of coupons on subordinated notes. Free cash flow all-in from telecom activities is not a financial aggregate defined by IFRS and may not be comparable to similarly named indicators used by other companies.

Earnings per share (EPS) – Group share Net income – Basic: Basic earnings per share are calculated by dividing (a) net income for the year attributable to the shareholders of the Group, after deduction of the remuneration net of the tax to holders of subordinated notes, by (b) the weighted average number of ordinary shares outstanding during the period.

Return On Capital Employed (ROCE): ROCE (Return On Capital Employed) from telecoms activities corresponds to Net Operating Profit After Tax (NOPAT) for the year ended (N) divided by Net Operating Assets (NOA) for the previous year (N-1).

Net Operating Profit After Tax (NOPAT) for the year ended (N) corresponds to operating profit (i) after interest on lease liabilities and on debts related to financed assets, and (ii) after income tax adjusted for the tax impact of financial income excluding interest on lease liabilities and on debts related to financed assets (tax charge calculated on the basis of the statutory tax rate applicable in France, the tax jurisdiction of the parent company Orange SA).

Net Operating Assets (NOA) for the previous year (N-1) correspond to (i) equity and (ii) financial liabilities and derivative liabilities (non?current and current), excluding debts on financed assets, (iii) less financial assets and derivative assets (non?current and current), cash and cash equivalents, including investments in Mobile Financial Services.

ROCE from telecoms activities is not a financial aggregate defined by IFRS and may not be comparable to similarly named indicators used by other companies.

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 Orange Business segment). For the Orange Business 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), (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, and (iii) equipment sales to other carriers.

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 Orange Business operating segment, (iii) equipment sales to other carriers, and (iv) 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.

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1 Excluding Public Switched Telephone Network (PSTN)
2 Unless otherwise stated, percentage changes are on a year-on-year basis, calculated against the third quarter of 2023 on a comparable basis.
3 Public Switched Telephone Network.
4 These targets are on a comparable basis and do not take into account mergers and acquisitions not yet finalized. They exclude Spain.

5 Excluding M2M and prepaid
6 Deconsolidated since the 2^nd quarter

Attachment

• PR_Orange_Q3_2024_EN_241024