Orange reported that restated EBITDA was 12.190 billion euros in 2014 and the ratio of restated EBITDA to revenues was stable at 30.9% after falling 1 percentage point in 2013 on a comparable basis.
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This performance is in line with the 2014 targets of restated EBITDA between 12 and 12.5 billion euros and a stabilized EBITDA ratio. The reduction in operating costs (707 million euros, -2.5%) offset 69% of the decline in revenues, versus 48% in 2013.
Over the past three years, the Group's cost basis has fallen by 1.729 billion euros, providing the Group significant room to manoeuvre for its future development.
Revenues were 39.445 billion euros in 2014, a decrease of 2.5% on a comparable basis, following a decline of 4.5% in 2013. Excluding the impact of regulatory measures, the decline was limited to 1.6% in 2014, after a decrease of 2.6% in 2013.
In the 4th quarter of 2014, revenues were stable (excluding the impact of regulatory measures), after declining 2.2% in the first nine months of the year. The improvement mainly concerned mobile services in France, Spain and Belgium, while Africa and the Middle East continued their steady growth. Added to this was the increase in mobile equipment sales, led by France and Spain.
CAPEX (5.636 billion euros in 2014) increased 1.3% on a comparable basis and represented 14.3% of revenues. Investments in very high-speed fixed and mobile broadband grew strongly (+41%), primarily in Europe and in particular in France.
Investments in mobile networks in Africa and the Middle East were significant, rising 22% to support rapid business growth. This level of CAPEX also allowed Orange to differentiate itself further for the quality of its services.
Commercial activity continued to be very dynamic in the 4th quarter, led by very high-speed fixed and mobile broadband services in Europe.
France had +256,000 net mobile contract sales in the 4th quarter: premium offers (Open and Origami) represented 61% of the customer base for consumer contracts at 31 December 2014; fixed broadband, with 95,000 net additions, had a market share of net additions estimated at 35% in the 4th quarter; 4G mobile had 3.7 million customers and fibre had 563,000 customers at 31 December 2014.
Net income was 1.225 billion euros in 2014, down 908 million euros in relation to 2013, principally due to the impact of specific items unrelated to operating performance. Most of these items reflect a policy of proactive adaptation to prepare for the future. The Group's share of net income was 925 million euros in 2014.
Net debt fell 4.636 billion euros in 2014 to 26.090 billion euros at 31 December 2014. In addition to the decrease of 1.822 billion euros related to operations and asset disposals was the favourable impact of the hybrid bond issue undertaken by the Group at the beginning of the year for 2.745 billion euros.
The hybrid bond issue in October 2014 (3 billion euros) connected with the public offer for Jazztel was offset by the pledge of monetary instruments for 2.9 billion euros as part of the surety required for this takeover bid. The restated ratio of net debt to EBITDA was 2.09x at 31 December 2014, versus 2.37x at 31 December 2013, in line with the objective of a ratio closer to 2x at the end of 2014.
Orange anticipates a restated EBITDA of between 11.9 and 12.1 billion euros for 2015. This objective will be supported by continuing work on the Group's cost structure. ■