Orange, the French telecommunications group, released its second quarter results on Wednesday. The company generated revenue of 10.93 billion euros ($12.08 billion), a 2% increase from the previous year. On a comparable basis, revenue was up 2.6%. These figures exceed the consensus expectations of EUR10.81 billion.
EBITDA After Leases
Orange’s earnings before interest, taxes, depreciation, and amortization after leases, an important profitability metric in the industry, reached EUR3.305 billion. While this represents a 0.2% decline compared to the previous year, it is a 1% increase on a comparable basis. The company-compiled consensus had expected EBITDA after leases of EUR3.31 billion.
Key Points to Note
Revenue Growth and Retail Services
Orange experienced accelerated revenue growth in the second quarter, driven by the performance of its retail services. These services benefited from price increases implemented earlier in the year. According to AlphaValue analyst Jean-Michel Salvador, Orange should continue to benefit from these price increases in the second half of the year.
Outlook and Targets
Orange has confirmed its commitment to achieving its 2023 targets, with an expected increase in EBITDA after leases compared to the previous year. However, weaker second-quarter trends in France may lead to lower consensus estimates. Nevertheless, analysts from Citi believe that cost headwinds will ease in the second half of the year. Alongside price rises, this should support the company’s earnings.