Orange Belgium : Third quarter 2016 financial r...

Solid mobile service revenues with +7.2 % restated EBITDA growth in Q3 lead Orange Belgium to upgrade its 2016 guidance

Clear focus on convergence and customer experience

Brussels, 21 October 2016 - Today, the Orange Belgium Group (Euronext Brussels: OBEL) publishes its results for the third quarter and first nine months of 2016. Following the rebranding and the national launch of the Orange Internet + TV offer in Belgium in the second quarter of 2016, Orange Belgium maintains an intense and sustained activity in the third quarter of 2016 with the launch of a new convergent and data centric mobile portfolio. In the third quarter of 2016, the Orange Belgium Group succeeded in realizing a solid restated EBITDA (+ 7.2 % year-on-year), supported by stable mobile service revenues and a constant focus on cost management, more than offsetting 13.0 million euros EU roaming impact.

• In the third quarter and first nine months of 2016 the Orange Belgium Group realized a total turnover of 311.1 and 919.8 million euros, an increase of 1.7 % and 0.8 % year-on year (+6.2 % and +2.9 % underlying growth once adjusted for the 13.0 and 19.2 million euros EU roaming impact). This performance has been fuelled by a solid growth in mobile service revenues of 5.2 % and 3.9 % year-on-year in the third quarter and first nine months of 2016 once adjusted for EU roaming, reflecting both a growing postpaid customer base (+57.3 thousand) and sustained postpaid ARPU evolution (+1.5 %) in Belgium, compared to September 2015.
   
• In combination with the positive development of the top line, a tireless focus on cost management allowed the Orange Belgium Group to absorb the fixed costs related to the cable launch and the adverse impact of EU roaming. The restated EBITDA amounted to 92.2 and 237.1 million euros in the third quarter and first nine months of 2016, equivalent to a 7.2 % and 4.0 % growth year-on-year. The Group pursued its efforts on cost transformation in the third quarter of 2016 that translated into lower commissions paid to third-party distributors, a reduction in labor costs and a further decrease in IT and network expenses. This operational performance, in addition to the mobile capex normalization, led to a net financial debt to EBITDA ratio of 0.9x from 1.7x a year ago, reflecting a strong operational cash flow in the third quarter of 2016, up 38.9 % year-on-year or 25.2 % year-on-year in the first nine months of 2016.
   
• The rebranding from Mobistar to Orange has been positively welcomed by the Belgian population. Riding the wave of the UEFA EURO 2016 sponsorship, and alongside the Go Europe roaming promotion during summer, Orange Belgium is increasingly perceived as a convergent operator. The first Orange Internet +TV advertising campaign launched in September 2016 as well as the newly launched advertising campaign that is currently supporting the launch of the new mobile product portfolio, will further establish Orange as a strong and convergent brand in Belgium.
   
• The Orange Internet + TV customer base developed favorably in the third quarter of 2016, reaching 17.6 thousand billed convergent customers, supported by a competitive pricing for a high quality product. While upselling campaigns towards existing mobile customers continue being a success, the go-to-market has progressively evolved in September 2016 towards the acquisition of people that are not yet Orange Belgium clients as more distribution channels (Carrefour, Media Markt) were opened. Towards the end of the third quarter of 2016 there was a clear acceleration in gross adds driven by the first Orange Internet + TV advertising campaign.
   
• Both the postpaid customer base and ARPU have now increased for six consecutive quarters. In a competitive and promotional market, Orange Belgium's postpaid customer base grew by 3.5 thousand customers in the third quarter of 2016, ahead of the launch of Orange Belgium's new mobile and convergent portfolio. For the first nine months of 2016 Orange Belgium added 29.7 thousand postpaid customers. Furthermore, 4G adoption amongst Orange Belgium's customers continued with an increase of close to 100 thousand active postpaid 4G users in the third quarter of 2016. Supported by the continued increase of 4G smartphone penetration and mobile data usage, the postpaid ARPU increased further to 28.8 euro in the third quarter of 2016, an increase of 1.5 % year-on-year, in spite of the impact of EU roaming regulation, reflecting the ability to upsell tariff plans and to monetize mobile data growth.
   
• As a result of this strong financial and commercial performance over the first nine months of 2016, the Orange Belgium Group is upgrading its restated EBITDA guidance by 10 million euros for the 2016 financial year by revising the guidance to 'between 280 and 300 million euros including 15 million euros cable costs' from 'between 285 and 305 million euros excluding cable costs' previously.

Orange Belgium Investor Relations

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Q3 2016 results - UK
Q3 2016 results - FR
Q3 2016 results - NL

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Source: Orange Belgium via Globenewswire