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Orange (ORAN) Q3 Revenues Top Estimates, EBITDA View up

OrangeS.A.ORAN recorded revenues of approximately $11,597 million in the third quarter of 2015, up 0.5% year over year on a comparable basis. Excluding regulatory measures, revenues increased 0.6% year over year. Quarterly total revenue of $11,597 million surpassed the Zacks Consensus Estimate of $11,448 million.

Segment wise, Mobile Services revenues totaled approximately $5,052 million, up 1.2% year over year. Enterprise & International carrier and Shared services revenues came in at $2,054 million, up 0.7%. Fixed services revenues were $3,799 million, down 1.5%. Mobile Equipment sales reached $467 million, up 8.5% and Other revenues totaled $225 million, up 4%.

Adjusted EBITDA (earnings before interest, tax, depreciation and amortization) increased 1.1% year over year to approximately $4,011 million. Quarterly EBITDA margin of 34.6% was up 20 basis points from the prior-year quarter. In the reported quarter, capital expenditure stood at around $1,763 million, up 7.6% year over year.

Revenues by Key Markets

In the reported quarter, revenues in France, the operator's largest market, fell 0.6% year over year to approximately $5,406 million. Revenues in Spain dropped 1.7% year over year to around $1,371 million. Revenues in Poland totaled around $800 million, down 2.4%. Revenues from Belgium & Luxembourg were $345 million, up 0.6% year over year while the same from Central Europe increased 3.2% to approximately $475 million.

In Africa and the Middle East revenues grew 6.8% to $1,471 million. Revenues from International Carriers and Shared Services increased 2% year over year on a comparable basis to approximately $548 million. In the Enterprise segment, revenues increased 0.5% year over year on a comparable basis to approximately $1,778 million.

Subscriber Trends

As of Sep 30, 2015, Orange had 263.335 million subscribers (excluding MVNOs) across its operating territories, up 6.1% from the year-ago quarter. The mobile customer base (excluding MVNOs) gained 6.2% to 201.675 million. MVNO subscriber base in Europe was 3.943 million, down a substantial 37.9% year over year. Subscribers of broadband services increased 10.7% to 17.942 million. IPTV and satellite TV customers rose 3% to 7.658 million. VoIP customers totaled 13.300 million, up 14.2%. IP VPN access lines for enterprise customers were 0.349 million, flat year over year.

Guidance

For fiscal 2015, Orange has raised its EBITDA guidance to €12.3 billion from the previous estimated €11.9 billion to €12.1 billion.

Zacks Rank & Stocks to Consider

Orange carries a Zacks Rank #3 (Hold). Better-ranked stocks in the non-U.S. telecom industry include NTT DOCOMO Inc. DCM , China Mobile Ltd. CHL and SK Telecom Co. Ltd. SKM . While NTT DOCOMO sports a Zacks Rank #1 (Strong Buy), both China Mobile and SK Telecom carry a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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