Orange Posts Lower H1 Profit, Backs Target For Operating Cash Flow

(RTTNews) - French telecom major Orange (ORAN), previously France Telecom, Thursday reported lower profit for the first half of the year, with notable revenue declines in France and Poland. The company, however, backed its full-year target for operating cash flow. The stock was losing more than 4 percent in early morning trading in Paris.

Orange Chairman and CEO Stéphane Richard said, "Against a macro-economic and competitive backdrop that remains difficult in our main markets, these results demonstrate the effectiveness of our strategy both commercially and in terms of reducing our cost structure.''

Net income attributable to owners of the parent declined to 1.068 billion euros ($1.41 billion) from 1.738 billion euros in the previous year.

Consolidated revenues dropped to 20.603 billion euros from 21.843 billion euros. Excluding the impact of regulatory measures, revenues declined 2.2 percent and on a comparable basis, the drop was 4.5 percent.

Revenues in France declined 6.8 percent on a comparable basis, with a 9.8 percent decrease in Mobile services where Average Revenue Per User or ARPU declined 12.1 percent.

Revenues in Spain rose 1.6 percent and Mobile services revenue declined 3 percent. In Poland, revenues decreased 8.6 percent amid a 10.3 percent drop in Mobile services.

Revenues in the Enterprise segment fell 4.9 percent to 3.297 billion euros, mainly due to the downturn in legacy business services, especially in France.

For the second quarter, revenues dropped 5.5 percent to 10.323 billion euros. On a comparable basis, revenues in France fell 7.5 percent and declined nearly 10 percent in Poland, while in Spain it grew 2.5 percent.

Orange had 231.5 million customers at the end of June 30, up 3.1 percent from last year, with 6.9 million net additions.

Looking ahead, the company confirmed its goal of operating cash flow, which is restated EBITDA less CAPEX, of more than 7 billion euros for 2013.

Orange confirmed that a minimum dividend of 0.80 euros per share would be paid for 2013. The Board decided on July 24 to pay an interim ordinary dividend of 0.30 euros per share.

It was on July 1 that France Telecom's company name and stock symbol changed. The change was to simplify and modernize the company's profile and image.

The stock was falling 4.2 percent in early morning trading at 7.42 euros.