registration document France Telecom 2009 - Orange.com

9 ANALYSIS
analysis of the financial position and earnings
OF THE GROUP’S FINANCIAL POSITION AND EARNINGS
■ a 65 million euro reduction in investments in very high
bandwidth (FTTH), for which a clarifi cation of the regulatory
framework was pending in 2009.
Ultimately, the ratio of capital expenditures on tangible and
intangible assets excluding licenses of continuing operations
to revenues reached 11.5% in 2009, compared with 13.4% in
2008, on both a historical and a comparable basis.
2008 vs. 2007
On a historical basis, the capital expenditures on tangible and
intangible assets excluding licenses of continuing operations
decreased by 0.7% or 45 million euros between 2007 and
2008. The year-on-year decrease takes into account factors
that increased capital expenditures, namely i) the impact of
foreign exchange fl uctuations, for 56 million euros, and ii) the
impact of changes in the scope of consolidation and other
changes, which totaled 49 million euros.
On a comparable basis, the capital expenditures on tangible
and intangible assets excluding licenses of continuing operations
were down 2.3% or 150 million euros between 2007 and 2008.
The reduction stemmed mainly from:
■ a 262 million euro reduction in investments on mobile
networks (excluding telecommunication licenses) in France,
Spain and Poland, primarily as a result of the completion of
the mobile networks in these countries;
■ a 229 million euro reduction in investments relating to
fi xed-line telephony in Poland, following signifi cant capital
expenditures in 2007 in connection with the transformation
of the business, the development of convergence offers
and products (notably the Livebox), and the optimization of
support functions; and
■ a 68 million euro reduction in equipment leases in the
Enterprise operating segment.
These reductions between 2007 and 2008 were partially offset
by:
■ a special transaction to buy back operating premises in
France. This program of asset acquisitions from Foncière des
Régions represented 163 million euros in 2008;
■ an 89 million euro increase in capital expenditures on fi xedline
networks in France, mainly relating to the pre-rollout of
fi ber optics (FTTH); and
■ an increase in capital expenditures in the Rest of the World
international subsidiaries (129 million euros) in connection
with the rollout of mobile networks in these countries and the
development of new subsidiaries in Africa.
Ultimately, the ratio of capital expenditures on tangible and
intangible assets excluding licenses of continuing operations to
revenues worked out at 13.4% in 2008 (compared with 13.9%
on a historical basis and 14.1% on a comparable basis in 2007).
Acquisitions of telecommunication licenses
ACQUISITIONS OF
TELECOMMUNICATION LICENSES
(in millions of euros)
2009
Financial years ended December 31
2008
2008
basis (1) basis
comparable historical
Chg. (%)
Chg. (%)
basis (1) basis
comparable historical
2007
historical
basis
Jordan (2) 51 - - - - -
Mali 8 - - - - -
Egypt (3) - 207 200 - - -
Armenia (4) - 42 52 - - -
Dominican Republic - 11 10 - - 3
Central African Republic - 1 1 - - 9
Niger - - - - - 48
Guinea - - - - - 20
Other (1) 9 10 na na 5
GROUP TOTAL 58 270 273 (78.6)% (78.8)% 85
(1) Unaudited data. See Section 9.1.5.1 Transition from data on a historical basis to data on a comparable basis.
(2) Acquisition of a 3G license in Jordan in 2009.
(3) Revised value of the investment in the fi rst frequency spectrum of the Mobinil UMTS license in Egypt (71.25% owned). The acquisition of the second frequency spectrum of the UMTS
license is scheduled for 2010.
(4) Acquisition of a mobile license (GSM and 3G) in Armenia in 2008.
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2009 REGISTRATION DOCUMENT / FRANCE TELECOM