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Money News

Orange beats forecasts in third quarter, raises interim dividend

FILE PHOTO: The logo of French telecom operator Orange is pictured on the facade of the Belgian unit in Brussels, Belgium, May 10, 2016.REUTERS/Francois Lenoir/File Photo

PARIS (Reuters) - Telecoms operator Orange posted on Thursday a 0.4% decline in its third-quarter core operating profit, but topped market expectations on continued proceeds from French peers that are co-financing its broadband fibre network.

The earnings before interest, taxes, depreciation and amortisation after leases (EBITDAaL) fell to 3.58 billion euros ($4.23 billion) over the July through September period, the Paris-based company said in a statement.

This slightly beat the average of 19 analyst estimates compiled by the company, which predicted a fall of 0.6%. Quarterly sales were up by 0.8% to 10.6 billion euros, also beating the consensus.

The COVID-triggered crisis slashed nearly 150 million euros from core operating profit in the third quarter, as Orange received fewer lucrative roaming fees from summer travellers.

“The summer quarters are very, very big quarters for roaming, since you have all the travellers ... especially for Orange where you have countries of destination in the South, such as France and Spain,” Chief Financial Officer Ramon Fernandez said in a call with reporters.

He said the impact would be significantly less important in the fourth quarter.

European telecoms operators Telefonica and BT Group were also due to report their quarterly numbers on Thursday.

Orange confirmed its full-year targets, including an expected drop of around 1% in core profit. It will increase its interim dividend by 10 euro cents to 40 cents and pledged to return to a dividend of 0.70 euro per share for 2020.

($1 = 0.8461 euros)

Reporting by Mathieu Rosemain, Editing by Sarah White and Sherry Jacob-Phillips

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