registration document France Telecom 2009 - Orange.com

analysis of the financial position and earnings
9
ANALYSIS OF THE GROUP’S FINANCIAL POSITION AND EARNINGS
2008 vs. 2007
(in millions of euros)
Financial years ended
December 31
Net financial debt as of December 31, 2007 (historical basis) 37,980
Organic cash fl ow (1) (8,016)
Dividends paid to owners of the parent company (2) 4,949
Payment of the dividend for 2007 (1.30 euros per share) 3,386
Payment of the interim dividend for 2008 (0.60 euros per share) 1,563
Acquisitions and proceeds from sales of investment securities (net of cash acquired or transferred) (1) 705
Dividends paid and capital changes relative to non-controlling interests 729
Change in the fair value of the price guarantee given to minority shareholders of FT España (3) 294
Escrow deposit (4) 207
Other elements (5) (989)
Net financial debt as of December 31, 2008 35,859
(1) See Section 9.1.4.1 Liquidity and cash fl ows.
(2) See Note 21 to the consolidated fi nancial statements.
(3) See Notes 21, 22, 29 and 31 to the consolidated fi nancial statements.
(4) Additional deposit made in 2008 in respect of the dispute over the implementation mechanism for business tax in France prior to 2003 (see Section 9.1.1.4 Key events in 2009 and
Notes 18, 26, 30, 31 and 32 to the consolidated fi nancial statements).
(5) Mainly the impact of change in the value of the pound sterling against the euro.
9.1.4.3.2 Financial resources
Financial assets at fair value through profi t and loss, fi nancial
liabilities and net fi nancial debt as well as derivative instruments
are described in Notes 19, 22 and 23 to the consolidated
fi nancial statements.
■ In 2009, the France Telecom Group continued to diversify, to
the greatest possible extent, its sources of funds to refi nance
its bond maturities (see Note 28 to the consolidated fi nancial
statements). Accordingly, in 2009:
■ France Telecom S.A. issued bonds for a total of 3.95 billion
euros, of which only 1 billion euros denominated in euros, the
remainder being issued in Swiss francs, US dollars or pounds
sterling;
■ TP Group issued bonds for a total of 700 million euros;
■ FT España secured 500 million euros in loans from the
European Investment Bank, of which 300 million euros had
been drawn as of December 31, 2009; and
■ FT ImmoH concluded a fi nance lease contract for a total of
140 million euros.
In 2009, France Telecom S.A. made the following bond issues:
■ in January 2009, a bond issue of 1 billion euros maturing in
2014 and bearing interest at 5%;
■ in February 2009, a bond issue of 500 million Swiss francs
maturing in 2013 and bearing interest at 3.375%;
■ in May 2009, a bond issue of 750 million pounds sterling
maturing in 2016 and bearing interest at 5%; and
■ in June 2009, a bond issue of 2.5 billion US dollars in two
tranches, one tranche of 1.25 billion US dollars maturing in
2014 and bearing interest at 4.375% and a second tranche of
1.25 billion US dollars maturing in 2019 and bearing interest
at 5.375%. The funds were received in July 2009.
The total amount of the bonds issued by France Telecom S.A.
in 2009 was 3.95 billion euros, with a weighted average maturity
at issue of approximately 6.5 years and a weighted average
annual coupon of 4.7%. The issuances made in 2009 in US
dollar and pounds sterling were for the most part swapped
for euros at variable rates, which explains how the fi xed-rate
component of the Group’s net fi nancial debt fell from 85% as of
December 31, 2008 to 81% as of December 31, 2009.
In 2009, France Telecom thus pursued its policy of dynamic
pro-active debt management by redeeming debt with a par
value of 2.4 billion euros, including 1,421 million euros in
perpetual bonds redeemable for shares (TDIRAs), 662 million
euros in debt pertaining to Orange’s in-substance defeasance
transactions in the United Kingdom and 328 million euros in
bonds.
The France Telecom Group’s policy is to be in a position to
meet its upcoming repayment obligations without additional
fi nancing, using available cash and existing credit lines, for at
least the next 12 months (See Note 28.3 to the consolidated
fi nancial statements).
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2009 REGISTRATION DOCUMENT / FRANCE TELECOM
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