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Orange very resilient despite the effects of the Covid-19 pandemic

Orange Campus Africa, Orange’s new African e-learning platform

Revenues and EBITDAaL declined in the 2nd quarter of 2020, negatively impacted by the effects of the health crisis. In the 1st half overall, revenues continued to grow, with a very moderate decline in EBITDAaL.

Good commercial performance, deferred investments and cost control enable Orange to reiterate its objective of 2020 organic cash flow of more than 2.3 billion euros.

France and Africa & Middle East rose 2.7% and 1.3% respectively year on year, almost completely offsetting the combined decline in other segments: Spain (-6.8%), Europe (- 3.6%), Enterprise (-3.3%).

These resilient results stem from the Group’s strategy focused on greater connectivity and new growth areas, enabling us to increase our customer bases.

In line with the “Engage 2025” plan, Orange signed a long-term electricity purchasing agreement with Boralex, a pioneer in renewable energy and the leading independent producer of onshore wind energy in France.

This contract for 67 GWh per year covers nearly 3% of Orange’s electricity consumption in France.

Outlook

For the financial year 2020, Orange confirms that it does not foresee any significant deviation with respect to its financial objectives:

For the 2021-2023 period, Orange confirms its financial objectives as announced during the investor day on December 4, 2019.

Orange will pay an interim dividend of 0.30 euros in cash on December 9, 2020. The decision on the final amount of the 2020 dividend will be announced between the results publication dates for the 3rd and 4th quarters of 2020.

A distribution of 0.70 euros per share remains the Group’s objective, including for the 2020 fiscal year, the final decision will be taken at a later date, depending on the situation.

Commenting on the publication of the 1st half 2020 results, Stéphane Richard, Chairman and CEO of the Orange Group, said: “Orange has shown a remarkable level of resistance in the first half of the year, despite the effects of the Covid-19 pandemic, with a 0.3% increase in revenues and a contained decrease in EBITDAaL of 0.8%. These results bear witness to our business’ resilience and its capacity for collective mobilisation in the face of this crisis.

In France, in spite of the restrictions due to the pandemic, our commercial dynamic is good, in particular in fibre: indeed we delivered a second-quarter record of 238,000 net additions. Our customers’ appetite for fibre confirms the validity of our investment strategy and we are continuing our deployment with a view to building as many connection points in 2020 as we did in 2019 notwithstanding the unprecedented health context.

In Spain, where the situation remains challenging given the market’s slide towards low cost, we have adapted our positioning and enlarged the range of our offers: a strategy that is now showing its first results.

In Africa and in the Middle East, revenues grew 3.8% in the first half and EBITDAaL rose by more than 7%: an excellent performance driven by mobile data (with a 40% increase in 4G customers year on year), by broadband and by Orange Money, that will be further strengthened by last week’s launch of Orange Bank Africa.

Even though Orange has proven to be more vital than ever to its business customers over these past months, the health crisis has impacted our results in B2B. I would, however, point to the very good performance of Orange Cyberdefense and Orange Cloud for Business where revenues grew by 11% and 8% in the first half.

This crisis has revealed the strategic nature of telecoms networks for our economies and even society as a whole. While impacted, we are comforted in the strategic choices we made with Engage 2025, the roll-out of which we will be accelerating, whether this is through mastering our carbon footprint, the deployment and optimisation of our infrastructures or the development of our growth territories.

I’d like to conclude by extending my warm thanks to all of Orange’s teams who have been fully mobilised throughout the crisis to serve our customers.”

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