ORANGE : 3rd quarter 2016 financial information

• The Group achieved a solid commercial performance in the 3rd quarter of 2016, driven by very high-speed broadband and convergence, with 845,000 net mobile contract additions and 348,000 additional fibre customers. There were 25.5 million 4G customers in Europe at 30 September 2016 (1.7x increase in one year) and 9.8 million customers of convergent offers at that date (+11% year on year).In France, mobile contract1 net additions remained at a high level (+187,000 in the 3rd quarter), confirming the attractiveness of Orange's segmented offers. Fixed broadband was also very buoyant, with 134,000 net additions in the 3rd quarter, led by fibre (+126,000) with 1.308 million customers at 30 September 2016.In Spain, fixed broadband growth continued to be very strong with 194,000 net fibre additions in the 3rd quarter and 1.411 million fibre customers at 30 September 2016. Mobile contracts climbed steadily, with 94,000 net additions in the 3rd quarter, a stronger performance than in the 3rd quarter of 2015.In Poland, the commercial performance was very satisfactory with 309,000 net mobile contract additions (the highest level in several years), after three quarters of already strong growth. In Belgium, the mobile contract1 customer base rose for the sixth consecutive quarter.In Africa and the Middle East, the mobile customer base at 30 September 2016 was 113.5 million customers and included Tigo in the Democratic Republic of the Congo (3.4 million customers) and Cellcom in Liberia (1.5 million customers), both of which were consolidated in the 3rd quarter. The trend in net additions improved significantly, with 103,000 net customer additions in the 3rd quarter after a decrease of 1.4 million customers in the 2nd quarter on a comparable basis. Orange Money had 20 million customers at 30 September 2016 (+30% year on year).

• Revenues reached 10.323 billion euros in the 3rd quarter of 2016, up 0.8%, after rising 0.3% in the 1st half (on a comparable basis). At 30 September 2016, revenues had increased 0.5%. The improving trend was confirmed despite the impact of the decline of national roaming in France and of roaming price reductions in Europe.Growth accelerated in Spain, rising 7.8% in the 3rd quarter after an increase of 6.2% in the 2nd quarter. Growth resumed in the Belgium and Luxembourg segment (+1.7%), and the trend improved in the Enterprise segment (+0.7%). France posted a modest decline of 0.6% in the 3rd quarter, while revenues rose 2.5% in Africa and the Middle East in the 3rd quarter following growth of 2.3% in the 2nd quarter.

• Restated EBITDA (3.597 billion euros in the 3rd quarter of 2016) rose 1.6% (+58 million euros) on a comparable basis and the restated EBITDA margin was 34.9%, an improvement of 0.3 percentage points compared with the 3rd quarter of 2015. Restated EBITDA for the first nine months of the year (9.510 billion euros) increased 0.2% (+19 million euros) and the restated EBITDA margin was essentially stable at 31.3%.
• CAPEX for the first nine months of the year (4.733 billion euros at 30 September 2016) increased 5.3% on a comparable basis and the ratio of CAPEX to revenues was 15.6% (+0.7 percentage points compared with 30 September 2015). Investments in very high-speed fixed and mobile broadband (fibre, 4G and 4G+) continued their steady climb, in line with the goals of the Essentiels2020 strategic plan. Investments also increased in the datacentres, in customer equipment (new Livebox in France) and in the new Smart Store concept stores.

For the full-year 2016, Orange confirms that restated EBITDA will be greater than that of 2015 on a comparable basis. This objective will be supported by continued commercial momentum,
investments, and efforts to improve the cost structure. The Group also confirms the target of a restated ratio of net debt to EBITDA of around 2x in the medium term to preserve Orange's financial strength and investment capacity. Within this framework, the Group is maintaining a policy of selective, value-creating acquisitions concentrating on markets in which it is already present.
The Group plans to propose the payment of a dividend of 0.60 euros per share for 2016 . An interim dividend for 2016 of 0.20 euros per share will be paid on 7 December 2016 .
Commenting on the publication of the results for the first nine months of 2016, Stéphane Richard, Chairman & Chief Executive Officer of the Orange Group, stated: 'The third quarter was again marked by a strong commercial performance, reflecting the success of Essentiels2020 - our strategy of differentiation through investment in high-speed broadband networks and the reinvention of our customer relationships. This performance can be seen in the accelerated growth of our revenues and restated EBITDA and enables us to confirm all of our objectives for 2016.
In France, due to a strong commercial dynamic, we reached the end of September with more than 10 million 4G customers, 1.3 million fibre customers and more than half of our broadband customer base using converged services. These developments have led to further improvement in both the satisfaction and loyalty of our mobile and fixed customers.
The increasing growth in revenues in Europe mainly stems from the excellent performance in Spain, with very strong growth in both mobile and fixed broadband, as well as the return to growth in Belgium, where our new convergent offers are showing early signs of success.
In Africa and the Middle East, where Orange Money customers now exceed 20 million, the increasing take-up of smartphones and our commercial strategy has translated into strong growth in mobile data revenues. The integration of the recently acquired operations in Sierra Leone, Burkina Faso, Liberia and the Democratic Republic of the Congo is on track, with the latter two operations now consolidated.
Lastly, the Enterprise business is performing well, with a third consecutive quarter of revenue growth, again due to the development of our IT activities and integration services.'
Excluding machine-to-machine.
Subject to approval at the annual shareholders meeting.
The ex-dividend date is set at 5 December 2016 and the recording date at 6 December 2016.

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