Orange Belgium's confirms its commercial success as a Bold Challenger
20 Luglio 2018 - 7:00AM
Press release
Embargo until July 20, 2018 at 7:00 am
Regulated information
Financial information for the
second quarter and first half of 2018
Orange Belgium's
confirms its commercial success as a Bold Challenger
2018 guidance
reiterated - New and strong forward-looking fundamentals (cable
regulation, new MVNO)
Growth in mobile contract customer additions has
accelerated (+26k net adds in Q2), spurred by improved offers
-
Orange Belgium recorded a total of 2.36 million
mobile contract customers at the end of the first half of 2018
thanks to an acceleration in customer net additions to 26 thousand
in the second quarter of 2018, compared to 21 thousand in the
second quarter of 2017. This solid performance was driven by Orange
Belgium's bold and innovative offers, led by its unmatched Eagle
Unlimited and convergent LOVE offers. Prepaid segment reached its
best performance in the past 11 quarters (-6 thousand).
-
In the second quarter of 2018, Orange Belgium's
mobile only contract ARPO stood at 21.3 euros, a slight decrease of
0.9 % year-on-year, explained by the last impact of the
Roam-Like-at-Home regulation, partly mitigated by an increase of
the underlying ARPO supported by a better customer mix. Orange
Belgium continued to drive a positive rebalancing of its customer
portfolio towards more mid- and high-end tariff plans. The launch
of Orange Belgium's Eagle Unlimited offer and abundant data tariff
plans drove an acceleration of the average mobile data usage per
smartphone user in the first half of 2018, reaching 2.6 GB/month,
increasing by 46 % year-to-date, almost double than in June last
year.
Continuing growth in convergent customer base
(+14k net adds in 2Q 2018)
-
Orange Belgium added 14 thousand new convergent
customers in the second quarter of 2018, compared to 15 thousand in
the second quarter of 2017, bringing the total at 136 thousand.
This performance has been achieved without promotions. Orange
Belgium continued to lower its cable churn rate thanks to an
improvement of its processes. Orange Belgium's convergent mobile
customer base increased to 207 thousand at the end of June 2018,
implying 1.5 SIM cards per cable household, and now represents 9 %
of the mobile contract customer base. The B2C convergent ARPO
increased by 2.4 % year-on-year to 73.7 euros in the second quarter
of 2018 from 72.0 euros in the second quarter of 2017.
Revenue growth (+3,1% in 2Q 2018) is further
picking up, mainly thanks to the increase of retail service
revenues
-
Revenues in the first half of 2018 reached 619.6
million euros from 607.4 million euros the previous year, despite
MVNO revenues decreasing and the impact of EU roaming regulation.
Revenue growth accelerated in the second quarter of 2018 to 3.1 %
year-on-year (Q1 2018: +0.9 % yoy), thanks to a strong increase in
retail service revenues, up 7.2 % year-on-year in the second
quarter of 2018.
-
Orange Belgium Group's adjusted EBITDA amounted
to 66.7 and 127.3 million euros in the second quarter and first
half of 2018, compared to the 78.1 and 146.5 million euros in the
second quarter and first half of 2017 respectively. Growth in
retail service revenues and efficient cost management were
mitigated by the expected decline in MVNO (H1 2018: -22.6 million
euros yoy) and EU-roaming revenues (H1 2018: -16.6 million euros).
These headwinds should ease in the second half of 2018. The cable
related EBITDA improved on a unitary basis in the first half of
2018, thanks to the implementation of several efficiency
initiatives, and ahead of the improved regulatory wholesale
conditions, though negative (H1 2018: -10.8 million euros vs.H1
2017: -9.8 million).
-
The organic cash flow amounted to 22.8 and 42.7
million euros in the second quarter and first half of 2018. Orange
Belgium Group investments in the second quarter and first half of
2018 remained stable compared to last year. The net financial debt
stood at 305.1 million euros at the end of the first half of 2018,
resulting in a sound net financial debt / reported EBITDA ratio of
1.1x.
Orange Belgium Group's
consolidated key figures |
H1
2018 |
H1
2017 |
Variation |
Q2 2018 |
Q2 2017 |
Variation |
|
|
|
|
|
|
|
mobile
contract customer base excl. M2M (Belgium) |
2,355 |
2,272 |
+3.7 % |
2,355 |
2,272 |
+3.7 % |
ARPO mobile
only contract (Belgium) |
|
|
|
21.3 |
21.5 |
-0.9 % |
convergent
customer base (in '000, Belgium) |
136 |
64 |
+111.1
% |
136 |
64 |
+111.1
% |
B2C
convergent ARPO (Belgium) |
|
|
|
73.7 |
72.0 |
+2.4 % |
convergent
mobile customer as % of mobile contract customer base
(Belgium) |
8.8 % |
4.2 % |
|
8.8 % |
4.2 % |
|
Revenues
(mio €) |
619.6 |
607.4 |
+2.0 % |
313.0 |
303.7 |
+3.1 % |
Retail
service revenues (mio €) |
370.0 |
346.7 |
+6.7 % |
188.8 |
176.1 |
+7.2 % |
Adjusted
EBITDA (mio €) |
127.3 |
146.5 |
-13.1
% |
66.7 |
78.1 |
-14.6
% |
Adjusted
EBITDA margin in % of revenues |
20.5 % |
24.1 % |
|
21.3 % |
25.7 % |
|
Net
investment (mio €) |
77.3 |
77.2 |
+0.1 % |
45.5 |
45.0 |
+1.0 % |
Organic
cash flow |
42.7 |
38.9 |
+9.7 % |
22.8 |
24.7 |
-7.6 % |
Net
financial debt (mio €) |
305.1 |
329.7 |
-7.5 % |
305.1 |
329.7 |
-7.5 % |
Finalization of Broadband and TV distribution
market analysis decision after approval of the European
Commission
-
After a public consultation on the analysis of
the broadband and TV distribution market in 2017, the CRC submitted
its draft decision to the Belgian Competition Authority and
subsequently to the European Commission early May 2018. One month
later, the European Commission issued its comments letter and
cleared the proposed wholesale regulation in Belgium. End of June
2018, the Belgian regulators finalized their decision, while taking
the EC comments into account.
Orange Belgium reiterates its financial guidance
for the financial year 2018
-
Orange Belgium reiterates its financial guidance
for 2018, pointing to a slight revenue growth and an adjusted
EBITDA between 275 and 295 million euros under IFRS 15 accounting
rules. The Orange Belgium Group expects its 2018 core investment
(excluding all cable related investments) to remain stable compared
to 2017.
Michaël Trabbia, Orange Belgium's
Chief Executive Officer, commented:
"In the first half of 2018, in line with our Bold
Challenger positioning, we demonstrated our ability to shake off
the market's status quo to the benefit of our customers. The recent
introduction of our Koala tariff plan, aimed at offering unlimited
calls as well as a decent bucket of mobile data to most of the
customers, and the earlier launch of the first fully unlimited
mobile offer in Belgium, both supported by our leading 4G network,
convinced more and more customers to choose Orange. Thanks to these
disruptive offers we are strongly accelerating the data usage
growth of our customers.
Regarding
convergence, we continued to improve our processes efficiency, and
our "Love" offers, with the introduction of Mobile Live TV at no
extra cost and of a Fixed Phone option. Moreover, the recent final
decision of the regulators regarding the Broadband and TV market
analysis marked an important step towards a sustainable internet
and TV offer with an improved quality of service and installation
process. It will also allow us over time to address the untapped
market for Internet-only offers.
Finally, we
entered into a very promising partnership with Medialaan, the
leading Flemish broadcaster, which includes a full MVNO agreement
starting as from spring 2019."
Arnaud Castille,
Chief Financial Officer, stated:
"Our commercial results and
underlying financial results mark a strong first half of the year
2018. This demonstrates our focus on increasing our mobile contract
and convergent customer base. It is also proof that we are capable
of improving efficiency of our cable business, while driving
innovation, digitalization and enhancing the overall customer
experience. Nevertheless, this semester's year-on-year comparison
was still impacted by the EU Roam-Like-at-Home regulation and the
decline of MVNO revenues. In the second half of the year our
underlying growth should be more visible as the gross EU roaming
impact will be very limited and could even be compensated by the
price-volume elasticity. In addition, the year-on-year evolution of
the MVNO revenues should be relatively flat in the second semester
of 2018.
We achieved two
other important milestones: firstly we signed a 5-year wholesale
partnership with Medialaan, the leading Flemish commercial
broadcaster. As from spring 2019, Medialaan will transfer
approximately 365,000 customers, currently hosted on the Base
network, to our leading 4G network. Secondly, the Belgian
regulator's decision for the TV and broadband market should allow
us to benefit from more sustainable wholesale conditions. This
should improve cable profitability and decrease churn even further.
Since inception, cable churn rate reached its lowest level in the
second quarter of 2018."
Orange Belgium - Financial results
Q2 2018
Orange Belgium - Résultats financiers T2 2018
Orange Belgium - Financiële resultaten Kw2 2018
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The issuer of this announcement warrants that they are solely
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information contained therein.
Source: Orange Belgium via Globenewswire
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