registration document France Telecom 2009 - Orange.com

analysis of the financial position and earnings
9
ANALYSIS OF THE GROUP’S FINANCIAL POSITION AND EARNINGS
■ an increase in fi xed-line and Internet revenues in emerging
markets, thanks to growth in domestic and international
interconnections, leased mobile network infrastructure and
the development of broadband Internet.
9.1.3.5.2 EBITDA - Rest of the World
2009 vs. 2008
On a historical basis, the EBITDA of the Rest of the World
reportable segment fell by 6% to 3,237 million euros between
2008 and 2009. The decline takes into account the positive
impact of foreign exchange fl uctuations for a total of 47 million
euros, linked mainly to change in the value of the Egyptian
pound, the Slovak koruna and the Swiss franc against the euro.
On a comparable basis, the EBITDA of the Rest of the World
reportable segment fell by 7.3% year-on-year. This 254 million
euro fall between 2008 and 2009 was attributable mainly to i) a
fall in EBITDA in Romania on the back of a decline in revenues,
ii) an increase in other network and IT expenses on the one
hand, and interconnection charges on the other hand, fuelled
by strong growth in the wholesale business in Ivory Coast, iii)
the impact of the rollout of new operations (Uganda, Armenia),
iv) partially offset by higher EBITDA in Egypt, Mali and Moldova,
matching the increase in their revenues.
2008 vs. 2007
On a historical basis, the EBITDA of the Rest of the World
reportable segment increased by 2.0% to 3,446 million euros
between 2007 and 2008. The increase takes into account the
negative impact of change in the scope of consolidation and
other changes for 95 million euros.
On a comparable basis, the EBITDA of the Rest of the World
reportable segment increased by 5.1% between 2007 and
2008. The 168 million euro increase was attributable to an
increase in EBITDA in Egypt, Romania and Senegal, fuelled
mainly by revenue growth in these countries, driven by an
increase in the number of customers.
9.1.3.5.3 Operating Income - Rest of the World
2009 vs. 2008
On a historical basis, the operating income of the Rest of the
World reportable segment totaled 1,910 million euros in 2009,
compared with 2,134 million euros in 2008, down 10.5%. The
decline takes into account positive impact of foreign exchange
fl uctuations for 32 million euros.
On a comparable basis, the operating income of the Rest
of the World reportable segment fell by 11.7% between 2008
and 2009. The decline was attributable to a fall in EBITDA, with
higher impairment losses being offset by lower depreciation and
amortization expense year-on-year.
2008 vs. 2007
On a historical basis, the operating income of the Rest of the
World reportable segment totaled 2,134 million euros in 2008,
compared with 2,214 million euros in 2007, down 3.6%.
On a comparable basis, the operating income of the Rest of
the World reportable segment fell by 2.8% year-on-year. The
decline was attributable mainly to:
■ a 147 million euro increase in depreciation and amortization,
mainly in Senegal (36 million euros), Egypt (28 million euros),
Kenya (14 million euros), Mali (12 million euros) and the
Dominican Republic (11 million euros), partially offset by a
fall in depreciation and amortization in Switzerland (13 million
euros); and
■ an 82 million euro increase in impairment losses, particularly
in relation to the Ivory Coast.
9.1.3.5.4 Capital expenditures on tangible and
intangible assets excluding licenses -
Rest of the World
2009 vs. 2008
On a historical basis, the capital expenditures on tangible and
intangible assets excluding licenses of the Rest of the World
reportable segment fell by 11.2% year-on-year to 1,405 million
euros in 2009, compared with 1,582 million euros in 2008.
The decline takes into account the impact of foreign exchange
fl uctuations for 9 million euros.
On a comparable basis, the 11.7% or 186 million euro fall in the
capital expenditures on tangible and intangible assets excluding
licenses of the Rest of the World reportable segment between
2008 and 2009 was attributable mainly to i) tight control over
investments on the extension of network coverage and the
rollout of the 3G network in mature markets, mainly in Romania,
ii) reduced investments on customer service platforms, mainly
in Egypt, iii) partially counterbalanced by investments in new
operations, mainly in Armenia and Uganda.
2008 vs. 2007
On a historical basis, the capital expenditures on tangible and
intangible assets excluding licenses of the Rest of the World
reportable segment increased by 6.3% to 1,582 million euros
between 2007 and 2008. This increase takes into account
factors raising capital expenditures, namely i) the impact of
change in the scope of consolidation for a total of 17 million
euros, particularly the acquisition of Telkom Kenya on December
21, 2007, and ii) the negative impact of foreign exchange
fl uctuations for 19 million euros.
On a comparable basis, the capital expenditures on tangible
and intangible assets excluding licenses of the Rest of the
World reportable segment increased by 8.9% or 129 million
euros between 2007 and 2008, due mainly to higher capital
expenditures on new operations in Kenya, Niger and Guinea,
and extensions to coverage and modifi cations to networks in
countries experiencing strong growth in mobiles.
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2009 REGISTRATION DOCUMENT / FRANCE TELECOM
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