Slides
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19 March 2025 Liudmila Climoc - CEO Jacek Kunicki - CFO Capital Markets Day
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2 .Grow strategy placed us on sustainable growth path driven by commercial activity 44%* TSR .Grow Ready for next era of Growth +11% +19% +53% Revenues EBITDAaL OCF 2020 2024 2020 2024 2020 2024 2 * Change in the share price between 25/6/2021 and 13/02/2025 + PLN 1.08 per share d ividends paid during this period
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3 We leverage powerful differentiating assets NPS #1 superior customer experience engaged team presence in high growing IT&IS market brand power unmatched connectivity loyal customer base now let’s move to the future 3
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4 Our market in 2028 is a fantastic place to be Source: CSO data and OPL internal +0.8m new households vs. 15m today * Extrapolation based on past data with MORE & wealthier customers +25% growth of disposable income* 4
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5 Our market in 2028 is a fantastic place to be with GROWING demand +50% avg. data consumption ~2m more customers with fibre (vs. 7.8m today) ~3m more mobile customers (vs. 45m active SIMs today) Source: OPL estimates 5
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6 Our market in 2028 is a fantastic place to be +200m of connected devices x2 small businesses in digital ecosystem +12bn PLN value of ICT market Source: OPL estimates with BOOMING digital economy with BOOMING digital economy 6
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Growth from convergent strategy and new households Doubling down on IT&IS to go beyond telco in business 9
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First choice for consumers – today & tomorrow Mój Orange App #1 Connectivity #1 Cybersecurity #1 Convenience 10
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▪ New growth possibilities offered by ▪ expanding fibre footprint ▪ cross-sell to mono product customers ▪ AI-enabled Customer Value Management ▪ convenience of digital journey ▪ Key benefits ▪ greater customer loyalty ▪ higher ARPO ▪ fulfilling all customer needs Convergent customers growth ARPO growth Convergence leadership is the bedrock of our value creation 2024 2028 12-15% 2024 2028 12-15% 11 1.8 124 in m in PLN
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New customers drive growth +500k new Orange households 12
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Mobile handset Fibre TV vs. 9.2m in 2024 vs. 1.6m in 2024 Leading product strategy to gain new customers Leading, flexible multi brand offers Mobile, fibre & TV standalone and in combinations AI-enabled hyper-personalisation Attractive TV content & entertainment Growing customer bases vs. 1.0m in 2024 13
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First choice technology partner for business – today & tomorrow Accelerate Growth Strengthen Leadership Telco IT&IS 14
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5G based services Next-gen connectivity IT&IS revenues In PLN bn Demand for digitalisation Unique position to deliver E2E value SDWAN eCommerce IoT Surfing new wave of IT&IS market growth 2.0 1.6 1.0 2020 2024 2028 15
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To…From… One integrated model cross-sell synergies commercial excellence scale up innovation full potential of partnerships Benefits 2024 2028 Multi cloud Cyber- security NEXT GEN 5G & IoT Infrastru- cture SoftwareData capture benefits of technological shift Accelerate on high-potential IT&IS for Large Business Large Business OPL entities providing IT&IS services 16 Telco revenues IT&IS revenues Majority of revenues coming from IT&IS
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2024 2028 Managing value in telco & expanding IT&IS Telco revenues IT&IS revenues Maximise SOHO/SME value, go beyond telco Value approach in core telco supported by next gen connectivity (5G/fibre) AI-driven customer value management ICT services best suited to SOHO/SME needs Digital Marketing & Sales Cloud Small Business Collaboration tools Cybersecurity 17
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Further development planned to expand successful FiberCo business model ▪ One-stop shop for operators ▪ Leveraging newly opened access to 2.5m FTTH HHs ▪ Enhanced customer experience thanks to digitalisation & automation Wholesale fibre customers (vs.2024) +50% Wholesale focused on asset monetisation in m HHC FiberCo rollout plan 2.1 0.7 2020 2024 2025 2.4 2028 18
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5G enabling superior connectivity, innovation & services Enhancing fixed network leadership
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5G for top connectivity, innovation & services Efficient 5G coverage expansion… ▪ Offer superb network quality & resilience ▪ Manage data consumption growth ▪ Launch new wave of FWA ▪ Develop dedicated networks for different use cases >90% in 2028* ...will enable us to: new 5G spectrum ** the highest number of customers per 1 MHz of spectrum *5G coverage in population The most effective use of spectrum** World class energy efficiency Sites development enhanced by RAN sharing 20 The most effective use of spectrum** World class energy efficiency Sites development enhanced by RAN sharing
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Enhancing fixed network leadership efficiently We are growing fibre coverage (m HHCs)… ▪ Maximising take-up of own infrastructure in retail & wholesale ▪ Building in high-potential areas ▪ Relying on trusted FiberCos for retail reach expansion …and improving its economics ~12 ~9 2024 2028 **EU subsidised projects & small M&As 21 *JV 50% owned by OPL Own built in low penetrated areas** FiberCo JV* Wholesale agreements off balance sheet
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360O transformation of our operating model
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360o transformation drives efficiency & quality Digital-first sales & care Lean processes & organisation Lighter asset base ▪ Digital channels for superior experience and efficiency ▪ AI-enabled customer care ▪ Optimise product portfolio ▪ Progressive copper decommissioning ▪ 3G switch-off ▪ Real estate disposal finalisation ▪ Zero-based process reengineering ▪ Right-sized organisation ▪ Revamped IT ▪ Smart sourcing supported by AI Automated smart network ▪ AI-enabled field force efficiency ▪ Cognitive network ▪ Top energy efficiency 23
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Growing share of digital sales Growing penetration of My Orange App My Orange App fully digital offer Flex Next level of sales & care 35% 25% 14% 2020 2024 2028 70% 55% 42% 2020 2024 2028 AI Agents to improve sales and care efficiency 24
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Field force efficiency Increased productivity through process reengineering Autonomous network Cognitive Network towards zero-touch autonomous network management AI-based capacity & reliability management AI-powered dispatching and routing of technicians Efficient, AI-enabled network operations 25
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Pruning underutilised legacy assets Cash & savings from sale of underutilised real estate Decommissioning of legacy copper & equipment to save costs More effective spectrum use with 3G switch off (2025) > 0.5 PLNbn portfolio ready for sale 0.6 PLNbn proceeds in 2021-2024 Improved service quality for 4G and 5G networks Progressive, based on occupancy/profitability 26
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Entrepreneurial culture Leading employer for top talent
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Empowered team to Lead the Future Winning team Entrepreneurial culture Best employer ▪ Driven by customer passion ▪ Boldly simplifying organisation & processes ▪ Leveraging innovation DNA ▪ Engaged team with strong focus on execution & efficiency ▪ Future-oriented leaders with capability to drive the Telco & TechCo business ▪ Attracting & developing talents ▪ Strong values in action ▪ Friendly work environment 28
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Responsible business is in our DNA 29 Maximizing circularity ~50% of home devices refurbished Digital inclusion 600k beneficiaries of Orange Foundation edu programs 100% renewable energy sourced -95% CO2e scopes 1, 2 vs 2020 Top energy efficiency Diverse & inclusive company Social engagement 3000 Orange volunteers
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EBITDAaL growth Revenue growth revenue profitability (direct margin) Capex efficiency Organic Cash Flow Net income DividendROCE Our model creates shareholder value high operating leverage (cost efficiency) + + 31
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2024 2028 Total revenues Wholesale, equipment & other IT&IS Core telco services Legacy Growth driven by core telecom services and IT&IS Diminishing impact of legacy services decline Revenue drives profitability with >55% direct margin Value creation starts with revenue growth Low single digit CAGR 32
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Opportunity in SOHO/SME (beyond telco) ARPO growth (value strategy & multiservice) Core telecom services IT&IS Customer base growth (fibre, 5G and new households) Revenues 4-6% CAGR 2024-28 Strong growth in Enterprise (integrated model) Revenues 5-7% CAGR 2024-28 Core telecom services and IT&IS drive profitable growth + + = = 33
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Transformation supports EBITDAaL margin * incl. gains on network rollout for FiberCo maintaining high operating leverage & striving to improve indirect cost/revenue ratio (vs. 29.6% in 2024) 2017 2020 2024 Indirect costs in 2024 Workforce adapted over time Costs to sustain business growth 15 12 in k 21 Labour IT & Network Property General Other* Transformation program CPI Indirect cost base Key levers Ambition Lighter asset base Automated smart network Lean processes & organisation Digital-first sales&careoutsourced permanent 34
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EBITDAaL growth key to value creation EBITDAaL growth 3.3 2.8 2020 2024 2028 ROCE Growth1.6% 7.9% strong direct profitability Revenue growth high operating leverage + + low-to-mid single digit CAGR 4.4% CAGR 35 in PLN bn
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Growth-focused capex drives higher returns Fibre Fibre Mobile Mobile 15.6% 14.3% <14% ▪ Investments focused on future-proofing growth areas; mobile (5G rollout) and fibre (client connections & rollout with EU subsidies) ▪ Optimisation of other capex & less real estate sales ▪ Majority of fibre investments done by the FiberCo JV (off- balance sheet) ▪ Focus on ROCE visible in lower eCapex/revenue ratio Average 2025 -28 Comparable eCapex Improving eCapex / revenues 2024 2025 -2820242020 36
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Strong focus on organic cash flow conversion OCF growth drivers 2025-2028 EBITDAaL eCapex Taxes & interests & working capital Organic cash flow low-to-mid single digit CAGR <14% of revenues increasing in line with growing business at least PLN 1.2bn in 2028 OCF growth in PLN bn 1.2 1.0 0.6 2020 2024 2028 > + + - ~ 37
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** Management recommendation, subject to approval of General Meeting of Shareholders, to be paid in 2025 * Change in the share price between 25/6/2021 and 13/02/2025 + PLN 1.08 per share d ividends paid during this period Sustained shareholder value creation PLN 0.53 per share as a floor for 2025-2028 Future dividend growth to be decided yearly, considering projection of underlying financial results & soundness of the balance sheet Dividend PolicyOPL share price during .Grow strategy (06/21-02/25) 2021 2022 2023 2024 Dividend per share (PLN) (for fiscal year) 0.53** 0.25 0.35 0.48 38 2021 2022 2023 2024 44%* TSR .Grow
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Lead the Future – financial guidance Guidance (2025 to 2028)* EBITDAaL low-to-mid single CAGR (vs. 2024) eCapex/Revenue <14% of revenues Organic Cash Flow At least PLN 1.2 bn in 2028 Dividend per share PLN 0.53 as a floor for 2025-2028 Future dividend growth decided yearly, considering projection of underlying financial results & soundness of the balance sheet 39 * Excludes major non-organic changes to OPL Group structure and major claims & litigations
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Orange Polska in 2028: 40 Customer Champion Unmatched Connectivity Empowered People Future-Ready Operations Sustainable Value Creation
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Q&A 41
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Appendix
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* Includes provision & final settlements related to the 2022-23 social plan **Average capital employed is calculated based on the average of capital employed in year n and n-1 Details of ROCE calculation for 2023 and 2024 43 ROCE FY 2023 FY 2024 in PLNm Operating income 1,221 1,419 Adjustment related to provisions for social plans 90 -63 Addback provision related to the 2024-25 social plan 125 50% of provision related to the 2022-23 social plan* -36 50% of provision related to the 2024-25 social plan -63 Adjusted Operating income 1,311 1,357 Equity 13,446 13,641 Net debt 3,528 3,670 Capital employed 16,974 17,311 Average capital employed** 17,214 17,143 ROCE (pre-tax) 7.6% 7.9%
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44 Expected timeline for spectrum acquisitions and renewals until 2030 Date Spectrum Description 2025 700/800 MHz spectrum auction 2027 1800 MHz renewal 2029 900 MHz renewal 2030/31 800/2600 MHz renewal
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45 Glossary (1/2) 4G/LTE Fourth generation of mobile technology, sometimes called LTE (Long Term Evolution) 5G Fifth generation of mobile technology, which is the successor to the 4G mobile network standard Adoption rate Fibre customer base (retail + wholesale)/ Total households connectable to our fibre network (own and 3rd parties) ARPO Average Revenue per Offer AUPU Average Usage per user Churn rate The number of customers who disconnect from a network divided by the weighted average number of customers in a given period Convergent services Revenues from B2C convergent offers. A convergent offer is defined as an offer combining at least a broadband access (xDSL, FTTH or wireless for fixed) and a mobile voice contract with a financial benefit. Convergent services revenues do not include equipment, incoming and visitor roaming revenues Core telecom services Convergence, mobile-only and broadband-only services EBITDAaL EBITDA after leases, key measure of operating profitability used by management (for definition please refer to the Note 2 to IFRS Consolidated Financial Statements of the Orange Polska Group) eCapex Economic Capex, key measure of resources allocation used by management (for definition please refer to the Note 2 to IFRS Consolidated Financial Statements of the Orange Polska Group) FBB Fixed Broadband Fibre fixed broadband access network based on FTTH (Fibre To The Home ) /DLA (Drop Line Agnostic) technology which provides the end user with speed of above 100Mbps
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46 Glossary (2/2) Fixed broadband-only services Revenues from fixed broadband offers (excluding B2C convergent offers and equipment sales) including TV and VoIP services FTE Full time equivalent FTO Full time outsourcing HHC (Households connectable) in fibre technology Households where broadband access service based on fibre technology can be rendered IT&IS IT & Integration Service Mobile-only services Revenue from mobile offers (excluding consumer market convergent offers) and Machine to Machine (M2M) connectivity. Mobile only services revenue does not include equipment sales, incoming and visitor roaming revenue FWA (Wireless for fixed) fixed broadband cell-locked wireless access offered by Orange Poland for home/office zone with rich data packages Organic Cash Flow Organic Cash Flow- key measure of cash generation used by management (for definition please refer to the Notes 2 to IFRS Consolidated Financial Statements of the Orange Polska Group) PPA Power purchase agreement ROCE Return on capital employed = EBIT (ex. extraordinary items) / (Shareholder’s Equity + Average net debt)
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47 This presentation contains 'forward-looking statements' including, but not limited to, statements regarding anticipated future events and financial performance with respect to our operations. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like 'believe', 'expect', 'anticipate', 'estimated', 'project', 'plan', 'pro forma', and 'intend' or future or conditional verbs such as 'will', 'would', or 'may‘. Factors that could cause actual results to differ materially from expected results include, but are not limited to, those set forth in our Registration Statement, as filed with the Polish securities and exchange commission, the competitive environment in which we operate, changes in general economic conditions and changes in the Polish, American and/or global financial and/or capital markets. Forward-looking statements represent management’s views as of the date they are made, and we assume no obligation to update any forward-looking statements for actual events occurring after that date. You are cautioned not to place undue reliance on our forward-looking statements. Forward looking statement