Q2 2020 Financial Results Orange Belgium July 24, 2020 - PowerPoint PPT Presentation

Q2 2020 Financial Results Orange Belgium July 24, 2020

Disclaimer This presentation might contain forward-looking statements about Orange Belgium in particular for 2019. Although we believe these statements are based on reasonable assumptions, they are subject to numerous risks and uncertainties, including matters not yet known to us or not currently considered material by us, and there can be no assurance that anticipated events will occur or that the objectives set out will actually be achieved. Important factors that could cause actual results to differ from the results anticipated in the forward-looking statements include, among others: the economic situation in Europe and more specifically in Belgium, the impact of price adjustments on the customer base resulting from competitive pressure, the evolution of the customer base, the effectiveness of Orange Belgium’s convergent strategy including the success and market acceptance of the voice and data abundance plans in the business segment and of the Orange Internet & TV offers, of the Orange Belgium brand and other strategic, operating and financial initiatives, Orange Belgium’s ability to adapt to the on -going transformation of the telecommunications industry, regulatory developments and constraints and the outcome of legal proceedings, risks and uncertainties related to business activity. 2

Section one COVID-19 impact 3

Orange Belgium follows the authorities’ recommendations in every step of the lockdown May March April Lockdown starts in Belgium Lockdown continues in Belgium Lockdown lifting starts  2-Mar: OBEL takes preventive measures  06-Apr: Shops could be visited in  04-May: Gradual ease of coronavirus  3-Mar: Government announced lockdown specific cases only with appointments lockdown measures  14-Mar: Shops closed on the weekends  11-May: All shops reopened  18-Mar All shops closed completely  18-May: gradual return to the office  Sanitary measures shared with our  Social distancing remains key:  Social distancing remains key: stakeholders rearrangement of shop space to rearrangement of office space to  Continuous communication at different guarantee the 1.5m distance rule guarantee the 1.5m distance rule  Frequent safety audits  Safety kit distributed levels  Measures taken to strictly comply with  Safety kit distributed  Continuous contact with various health regulations government bodies and follow updates and  Safety guide developed recommendations closely 4 Orange Restricted 4

COVID-19 impact in Q2’20: € 38.2m total impact on revenues – mitigated on the EBITDAaL Commercial Revenues EBITDAaL  lower acquisition of mobile  Lower incoming  Lower incoming SMS have no - € 16.0m customers and convergence SMS impact on EBITDAaL  Declining roaming is  Lower visitor roaming  lower handset sales - € 5.8m compensated by lower roaming  Lower customer roaming - € 4.7m  decrease in SMS and roaming costs traffic  Lower handset  Lower equipment sales have - € 11.7m sales limited impact on EBITDAaL  Mitigation measures applied  Lower B2B revenues due to frozen project 5 Orange Restricted 5

Section two Q2 2020 Highlights 6

Orange Belgium keeps improving its offers during Q2 Internet boost As a Bold Challenger, we follow closely the habits of our Download speed increased customers and we know a fast from 200 Mpbs to 400 Mpbs and reliable connectivity is key.. Offer available to residentials, independents Revamping B2B offers (Shape & Fix) and SoHo New ultra-fast Automatic Additional 400 Mbps double data options such as internet on the fixed phone or connection mobile fleet television 7

The Jupiler Pro League will be available to all Orange customers, convergent and mobile, for 5 years as from August 2020 Orange Belgium is the first player signing a distribution agreement allowing to make the Jupiler Pro League available for its customers The 3 existing Eleven Sports channels remain included in the standard digital TV package without any additional fee Orange Love Duo and mobile customers will be able to subscribe to Eleven Sports monthly OTT passes to watch Belgian football online This content will be available at reasonable prices, without customers having to pay for additional content in large content bundles 8

Q2 2020 Key achievements 17.8% Mobile contract Convergent Net additions excl. M2M customers Mobile contract + 7 k 2.6 m of total 288 k excl. M2M postpaid Convergent mobile base is 3.1% yoy + 8 k +33.6% yoy customer convergent Belgium Belgium Belgium Belgium Revenues Retail service EBITDAaL eCapex revenues € 302.8 m € 221.0 m € 86.0 m € 29.8 m -7.9% * yoy +2.1% * yoy + 9.7% * yoy - 30.7% yoy *based on 2019 comparable figures 9

Section three Operational Results 10

Convergence: customer base increase in spite of the COVID-19 impact 25 25 21 19 20 17 16 14 8 288 280 Love (‘000) 258 233 216 200 180 +8k +33.6% 15% 155 136 Love customer Love customers of convergent net adds, yoy variation customer base * * -47.7% yoy is Love Duo Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 41 39 40 36 33 Convergent mobile (‘000) 30 25 20 12 462 451 411 1.6 17.8% 372 342 317 283 SIM cards per of total postpaid 243 207 convergent mobile base is customer convergent (Q2’19: 13.6%) * * Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 *Impacted by COVID-19 Customers Net adds 11

Growth of the mobile postpaid customer base within a competitive landscape and COVID-19 impact +3% 2,594 2,579 2,588 2,548 2,516 9 31 32 352 319 385 396 294 26 Customer base (‘000) Net adds (‘000) 25 33 33 22 7 11 7 4 2,222 2,229 2,227 2,202 2,198 -2 -4 -24 * * * * Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 B2C mobile convergent Mobile only (incl. B2B mobile convergent) *Impacted by COVID-19 12

Mobile prepaid: continued decline in Q2 mainly due to COVID-19 effect -13% Customer base (‘000) -4 -4 Net adds (‘000) -21 -21 -28 557 553 532 511 483 * * * * Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 *Impacted by COVID-19 13

Mobile: Average mobile data usage close to 5 GB +21% +38% 4.9 GB +79% Average mobile data usage (GB) (excl. MVNO) Average mobile data usage (smartphone), +35% 4.9 +21% yoy +55% 4.5 4.1 4.1 3.7 +57% 3.2 3.3 +120% 2.5 1.8 1.3 1.3 0.3 0.9 0.9 0.6 0.5 0.3 0.1 EoP 2013 EoP 2014 EoP 2015 EoP 2016 EoP 2017 EoP 2018 EoP 2019 EoP 2Q19 EoP 2Q20 96% On total users base On smartphone user base % 4G in total traffic +27% Total mobile data traffic (Q2’19: 95%) evolution (Gb) (excl. MVNO) +27% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Total mobile data Q1 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 14 14 14 15 15 15 15 16 16 16 14 16 17 17 17 17 18 18 18 18 19 19 19 19 20 20 traffic yoy increase 4G 3G 14

Slight decrease in B2C convergent ARPO and in mobile-only ARPO Quarterly B2C convergent ARPO ( € ) Quarterly mobile only ARPO ( € ) +4.1% -1.6% +1.6% +1.3% -2.5% -2.6% -3.2% -1.5% -1.9% -4.6% 77.7 76.8 76.7 75.9 75.6 21.2 20.6 20.4 20.3 19.7 7.1 6.9 6.7 6.7 6.4 7.1 6.7 6.9 6.7 6.4 * * * * Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Convergent yoy Postpaid (mobile-only) Prepaid yoy Postpaid *Impacted by COVID-19 15

Regulatory update (1/2) 27 May: CRC published its final decision on new cable wholesale tariffs entering into force on 1 July  Orange Belgium takes note of the final decision of the regulators, and:  Regrets that the EC’s comments have only marginally resulted in changes to the draft decision Cable Considers that the wholesale charges, especially for the high-speed internet access services, will remain Regulation significantly above ‚fair charges‛ to the detriment of consumers Wholesale Requests the regulators to monitor closely the effects of this decision on the price evolution for Belgian customers; Pricing and to initiate a review of the wholesale prices as soon as a negative effect is observed 25 November 2019: Orange Belgium and Proximus signed an agreement to establishing a 50-50 JV on  radio mobile access network sharing, covering 2G, 3G, 4G and 5G technologies 10 January 2020: CA provided the BIPT an additional period of 2 months during which they can further  assess the agreement 16 March 2020: the period during which interim measures applied expired  Network sharing agreement with 1 April 2020: the employees of Proximus and Orange Belgium were transferred to the JV, named Mwingz  Proximus The procedure on the merits is ongoing  16