* Shares fall by more than 3%
* Confirms earnings targets
* CEO to present strategic plan in February 2023
PARIS, July 28 (Reuters) - Shares in Orange SA,
France's biggest telecom firm, fell on Thursday as investors
worried about a plunge in first-half profits at its enterprise
and IT services division.
The stock was down more than 3% at 0751 GMT, the third-worst
performer on France's blue chip index, despite the group
reporting second-quarter results in line with analyst forecasts.
Orange said its enterprise division saw core operating
profit, or EBITDAaL, drop more than 25% in the first half from a
year earlier, fuelling concerns over the group's ability to
reach its full-year profit targets, which it confirmed.
"They're a little bit behind their guidance for the year in
terms of EBITDAaL, so that might be a little bit of a concern in
terms of their ability to still meet the annual target," said
Oddo BHF analyst Stephane Beyazian.
Less profitable IT integration services did not fully offset
a steep fall in voice services contracts, Orange said. The group
aims to halve the unit's core profit decline in the second half
with a turnaround plan that will entail cost cutting, it said.
Group earnings before interest, taxes, depreciation and
amortisation after leases (EBITDAaL) rose by 0.5% to 3.31
billion euros ($3.38 billion) in the first half.
Orange confirmed its full-year target for core operating
profit growth of 2.5% to 3.0%.
The group has struggled to revive its stock valuation and
renew growth in its two biggest markets, France and Spain, as it
faces costly investments to deploy fixed and broadband networks
on top of stiff competition in the two countries.
Orange's Spanish market in particular has weighed on profits
lately. The group expects that division's earnings to grow again
from next year, potentially helped by the unit's planned $19
billion tie-up with MasMovil.
New group CEO Christel Heydemann will present a strategic
plan in February.
($1 = 0.9800 euros)
(Reporting by Mathieu Rosemain; Editing by Shounak Dasgupta and