Orange (ORA) Q4 2024 earnings summary

Executive summary

• 2024 results exceeded or met guidance, with strong performance across all business pillars, robust commercial execution in France, double-digit growth in Africa & Middle East, and accelerated transformation under the Lead the Future strategy.

• Free cash flow nearly doubled over two years, reaching €1.4bn incremental, and organic cash flow rose 5.9% to €3.4bn.

• MASORANGE joint venture in Spain completed, now accounted for under the equity method, with Spain excluded from 2024 KPIs except net debt.

• AI and operational efficiency initiatives contributed to cost savings and improved margins, with €400m in savings and €200m in value from AI use cases.

• ESG targets for 2025 largely met ahead of schedule, including CO2 emissions and diversity goals.

Financial highlights

• Group revenues reached €40.3bn, up 1.2% year-over-year, driven by retail and Middle East & Africa.

• EBITDAAL grew 2.7% for the year, accelerating to 3.2% in Q4; EBITDAAL margin at 30.4%.

• Net debt/EBITDAAL ratio improved to 1.8x, supported by MASORANGE proceeds; net financial debt reduced by €4.5bn to €22.5bn.

• EPS increased 12% to €0.82; return on capital employed rose to 6.9%.

• Dividend set at €0.75/share for 2024, fully covered by free cash flow.

Outlook and guidance

• 2025 guidance upgraded: EBITDAAL expected to rise ~3%, organic cash flow at least €3.6bn, net debt/EBITDAAL around 2x.

• eCAPEX to sales ratio to remain around 15%; leverage target maintained at ~2x.

• Dividend floor of €0.75 for 2025 and 2026, with future policy to be reviewed at next Capital Market Day.

• Africa & Middle East targeting at least high single-digit EBITDAAL growth in 2025; Europe expected to deliver low single-digit EBITDAAL growth.

• Orange Business aims to halve EBITDAAL decline in 2025 and stabilize in 2026.