Orange Q1 “in line” with targets
April 26, 2023
Orange group revenues grew 1.3 per cent in the first quarter of 2023 (+€135 million) compared to Q1 2022 thanks to growth in retail services (+2.8 per cent or €219 million), fueled in particular by repricing in Europe and by the growth driver Africa which saw a sharp 9.1 per cent increase in revenues (+€141 million), followed by Europe with 3.8 per cent growth (+€102 million), driven by Poland (+7.1 per cent) and Spain, which has confirmed its return to growth (+2.8 per cent) for the third consecutive quarter.
Revenues in France were 1.8 per cent lower (-€78 million) as a result of the downward trend in wholesale in line with our expectations (-7.8 per cent). This was partially offset by the increase in retail services excluding STN (at +2.1 per cent, its low point for the year). The recent repricing that will be fully effective as of the second quarter will progressively contribute to the growth in retail services.
The slight 0.7 per cent decrease in Enterprise revenues (-€14 million) continued to be driven by the sharp decline in fixed voice revenues (-11.6 per cent), partially offset by growth in IT & Integration services revenues (+5.3 per cent). The recovery plan for this segment is ongoing.
In terms of commercial performance, the Group maintained its leadership position in convergence, with 11.6 million convergent customers across Europe (+0.6 per cent), and its commercial momentum on mobile contracts and very high-speed fixed broadband. Mobile services had 243.4 million accesses (+5 per cent), including 95.8 million contracts (+8.5 per cent). Fixed services totaled 45.0 million accesses (down 2.7 per cent), including 14.7 million very high-speed broadband accesses, that continued to grow strongly (+14.7 per cent). Fixed narrowband accesses continued to decline (-14.2 per cent).
At 31 March 2023, Group EBITDAaL stood at €2.59 billion, up 0.5 per cent, in line with the target of slight growth in 2023. The EBITDAaL margin for telecom activities, traditionally lower in the first quarter, was 24.7 per cent owing to a more severe seasonality effect this year related to the recognition of operating taxes. The next few quarters will further benefit from the price increases introduced in early 2023. EBITDAaL from telecom activities was €2.62 billion (+0.9 per cent).
eCAPEX totaled €1.493 billion in the first quarter of 2023, a decrease of 4.9 per cent year on year and in line with the target of a significant reduction in 2023. The number of households connectable to FTTH reached 66.6 million (+13.8 per cent) and the FTTH customer base increased to 14.2 million (+15.1 per cent).
The Group confirms its financial targets, in particular those for 2023.
Christel Heydemann, Chief Executive Officer of the Orange group, commented: “The continued increase in revenues and EBITDAaL, as well as the decrease in eCapex compared to Q1 2022, are in line with our objectives for 2023 and reinforce our ambition for the years to come. We have started to execute our ‘Lead the Future’ strategic plan with an even more value-oriented commercial strategy thanks to the quality of our networks and services which, combined with our cost controls, allow us to partially offset inflation. Our performance is once again driven by the remarkable growth in Africa and the Middle East and our strong value-driven growth in Europe. This quarter our retail services returned to growth in Spain, a country that has now seen growth for three consecutive quarters, and we’ve had double-digit revenue growth in our Orange Money business in Africa. Both demonstrate the strength of the Group and our ability to respond to increased competitive pressure. In France, retail services continue to grow and this should further accelerate in the second half of the year due to the recent price increases. Finally, in the Enterprise segment, we are executing our transformation plan.
I would like to warmly thank all the Orange teams who strive every day to serve our customers well and are committed to the deployment of our ‘Lead the Future’ strategic plan. Together, we will deliver our ambitions in terms of growth and long-term value creation,” added Heydemann.