Orange Polska (OPL) Q4 2024 earnings summary

Executive summary

• 2024 marked the successful completion of the .Grow strategy, achieving all operational and financial objectives, with strong commercial momentum, improved customer perception (NPS #1), and robust growth in customer base and ARPU across key telco products.

• Core telecom services drove growth, offsetting declines in IT/IS and energy resale revenues, while the full opening of the fiber network to operators boosted monetization and limited overbuild risk.

• 5G network rollout on C-band now covers 40% of Poland's population; radio access network renewal is ongoing, and the fiber footprint expanded to 9 million households.

• ESG achievements include a 78% reduction in CO2 emissions (Scope 1 and 2) since 2015 and digital education programs for 500,000 beneficiaries.

• ROCE improved from 1.6% in 2020 to 7.9% in 2024, with financial leverage halved to 1.1x.

Financial highlights

• 2024 revenues were PLN 12,732 million, down 1.8% year-over-year, as core telecom services grew over 5% while IT/IS and energy resale declined.

• EBITDAAL rose 4.6% to PLN 3,324 million, with margin up 1.6pp to 26.1%; net income increased 12% to PLN 913 million.

• Organic cash flow was PLN 985 million, down 16% year-over-year due to higher working capital needs.

• Economic CapEx (eCapex) was PLN 1,822 million, up 17% year-over-year, reflecting accelerated 5G and fiber rollout.

• Free cash flow will be included in regular reporting, reflecting all-in cash generation, including spectrum payments and EU subsidies.

Outlook and guidance

• 2025 priorities: sustain growth in convergence, mobile, and fiber; rejuvenate business segment growth, especially IT&S; enhance connectivity via 5G and fiber expansion.

• Guidance targets low single-digit growth in both revenues and EBITDAAL, with eCapex expected at PLN 1.8–1.9 billion.

• CapEx guidance includes continued 5G rollout, radio network renewal, and EU-subsidized fiber expansion; excludes mobile spectrum acquisition.

• Dividend proposal of PLN 0.53 per share, a 10% increase year-over-year, with commitment to sustainable, growing dividends.

• New mid-term strategy and dividend policy to be presented in March 2025.