Orange sees small slowdown in EBITDA growth in 2019 on tough French, Spanish markets

News General France 21 FEB 2019
Orange sees small slowdown in EBITDA growth in 2019 on tough French, Spanish markets

Orange said it expects a small slowdown in EBITDA growth this year, from 2.7 percent comparable growth in 2018, due to tough competition in France and Spain. The company still expects to maintain its dividend at 70 cents per share, thanks to continued growth in operating cash flow and lower capital expenditure in 2019.

In 2018, the French operator's revenues rose 1.3 percent to EUR 41.4 billion, and adjusted EBITDA was up 2.6 percent to EUR 13.0 billion. Operating cash flow improved 1.7 percent to EUR 5.6 billion, while capex was up 3.2 percent excluding licences, to EUR 7.4 billion. 

French growth slows

Revenue growth improved to 1.4 percent in the fourth quarter from 0.6 percent in Q3. Africa and the Middle East again led the growth, with a 5.2 percent organic increase in revenues in Q4, thanks to demand for data and mobile money services. Orange's convergence strategy drove organic growth of 2.4 percent in Spain in Q4, while France slowed to growth of just 0.1 percent, compared to 0.9 percent over the full year. 

Adjusted EBITDA in Q4 rose 2.0 percent to EUR 3.3 billion and was up 1.4 percent on a comparable basis. Operating cash flow increased 10.8 percent to over EUR 1 billion, after a small dip in capex. 

The expected slowdown in organic EBITDA growth in 2019 is due to the "very competitive" market conditions, particularly in Spain and France, Orange said. In addition, it no longer has the one-time boost from changes in the e-books and press offer in France last year. Nevertheless, Orange still expects to grow operating cash flow this year on a comparable basis, helped by a reduction in capex. Later in the year it will also present new mid-term targets, with its Vision 2025 plan. 

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Orange

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Africa,  Europe

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France

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Financial figures, Wireline, Wireless

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