Orange Polska (OPL) Q4 2024 earnings summary

Executive summary

• Achieved all 2024 objectives with strong commercial performance, customer base and ARPU growth, and successful execution of the .Grow strategy, leading to improved customer perception and NPS #1.

• Significant progress in 5G (C-band covers 40% of Poland) and fiber network expansion, with radio access network renewal to be completed in 2025.

• .Grow strategy (2021-2024) delivered 25% revenue growth in core telco retail and 60% in wholesale and IT&S.

• 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 to 7.9% in 2024, up from 1.6% in 2020 and 7.6% in 2023.

Financial highlights

• FY24 revenues reached PLN 12,732m, down 1.8% year-over-year, mainly due to declines in energy resale and IT & IS, while core telecom services grew over 5%.

• EBITDAAL grew 4.6% year-over-year to PLN 3,324m, with margin up 1.6pp to 26.1%.

• Net income increased 12% year-over-year to PLN 913m, driven by EBITDAAL growth.

• Organic cash flow reached PLN 985m, supported by higher EBITDA and disciplined capital expenses, but down 16% year-over-year due to higher working capital needs.

• Economic CapEx was PLN 1.8 billion, with PLN 230 million invested in fiber and over PLN 500 million in mobile, including 5G deployment.

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.

• Revenue and EBITDA growth targeted for 2025, with cost discipline and direct margin improvement as key drivers.

• 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 to be announced in March 2025.