Positive results despite impact of Covid-19 and strained competitive environment

 Press release
Embargo until 21 April 2021 at 7:00 am
 Regulated information – Inside information

Financial information for the first quarter 2021

Positive results despite impact of Covid-19 and strained competitive environment

• Mobile postpaid customer base +3.0% yoy / Cable customer base +24.8% yoy
• Q1 Revenues -1.0% yoy / Q1 Retail service revenues +1.9% yoy
• Q1 EBITDAaL+12.8% yoy, +4.6% yoy excluding seasonality effect
• 2021 guidance confirmed

Q1 Operational Highlights

Commercial performance remained solid amid a tougher competitive environment and on-going Covid-19 measures that limited the shops’ full capacity. Go portfolio remains a success, with Go Unlimited special edition gaining traction. During the quarter, 23k new mobile postpaid customers were added, reaching 2.7m subscribers (+3.0% yoy). Cable net adds continued to be strong with 23k new customers. One third of the gross adds are Love Duo customers, confirming the commercial trend of former quarters. Convergent mobile subscribers continued to grow and now represent 21.3% of mobile postpaid customers vs 17.4% achieved in Q1’20. Mobile only postpaid ARPO declined by 3.4% yoy to €19.6, due to the decrease in out-of-bundle revenues. B2C convergent ARPO decreased by 2.8% yoy to €73.8, mainly explained by the discounts provided on mobile tariff plans in convergence, as well as the continuous growth of Love Duo in the customer base, decreasing the overall ARPO.

Orange Belgium: key operating figures
	Q1 2020	Q1 2021	change
Mobile postpaid customer base (in ‘000)	2,588	2,664	3.0%
Net adds (in ‘000)	9	23	160.5%
Mobile only postpaid ARPO (€ per month)	20.3	19.6	-3.4%
Cable customer base (in ‘000)	280	349	24.8%
Net adds (in ‘000)	21	23	6.8%
B2C convergent ARPO (€ per month)	75.9	73.8	-2.8%
Cable customer as % mobile contract customer base	17.4%	21.3%	386 bp

Q1 Financial Highlights

Revenues reached €330.4m, down 1.0% yoy. Retail service revenues continued to grow by 1.9%, mainly thanks to higher convergent service revenues (+16.9% yoy). As in past quarters, Covid-19 impacted wholesale revenues          (-16.0% yoy), mainly due to lower incoming SMS revenues (-€12.3m, offset by lower SMS costs). EBITDAaL grew 12.8% yoy to €70.1m, driven by higher retail service revenues, supported by lower costs (-4.2% yoy). There was a €3.6m tailwind from seasonality in advertising and promotional spend linked to the launch of Go offers in Q1’20 and €1.5m one-off related to roaming. Excluding those effects the EBITDAaL had grown +4.6% yoy to €65.0m. eCapex (excluding spectrum licence fees) increased slightly by 2.6% yoy to €36.1m. 2021 financial guidance confirmed: Orange Belgium expects low single-digit revenue growth, EBITDAaL of between €320m and €340m and eCapex between €200m and €220m.

Orange Belgium Group: key financial figures
in €m	Q1 2020		Q1 2021	change
Revenues	333.9		330.4	-1.0%
Retail service revenues	224.8		229.0	1.9%
EBITDAaL	62.2		70.1	12.8%
margin as % of revenues	18.6%		21.2%	260 bp
eCapex 1	-35.1		-36.1	2.6%
Operating cash2	27.0		34.1	26.0%
Net financial debt	229.0		122.6

1. eCapex excluding licence fees. In Q1 2020 Orange Belgium paid 10.9 million euros on licence fees.
2. Operating cash flow defined as EBITDAaL – eCapex excluding licence fees
   

Xavier Pichon, Chief Executive Officer, commented:

The first quarter of the year was characterised by both an ever-straining competitive environment together with the extension of the Covid-19 policies. Our shops remained open but with limited capacity in accordance with the recommendations of the competent authorities.

Thanks to our Team members’ commitment, we were even able to offer an improved customer experience and to attract new customers with numbers comparable to pre-pandemic levels.

Despite the challenges we are facing, Orange Belgium has shown strong resilience and delivered solid commercial and financial results for this quarter.

Antoine Chouc, Chief Financial Officer, stated:

The positive commercial performance also resulted in good financial results. Despite the sanitary crisis, we were once again able to grow in terms of retail service revenues, confirming the resilience of our activity. Thanks to our transformation programme, seasonality effect in our indirect costs as well as the one-off in roaming, we managed to improve the EBITDAaL in comparison to the first quarter of 2020.

The first quarter gives us the necessary assurance that we will achieve our guidance announced last quarter.

Attachment

• ENG Q1 2021 - FV