Orange makes 324.4m-euro gross profit

Mobile telephony operator Orange Romania posted a 324.4 million-euro (1.175 billion RON) gross profit last year, an increase of almost 35% in euros from 2004, and turnover worth 870 million euros (3.117 billion RON), according to data published by the company in the Official Gazette.
The 2005 gross profit in RON rose by approximately 20.5% compared with the previous year. According to the information on the Finance Ministry’s website, Orange posted 240.5 million euros in gross profit for 2004, with net profit standing at 182.95 million euros.
The financial results in euros were calculated at the average exchange rate announced by the NBR for 2004 (4.0532 RON) and 2005 (3.6234 RON).
The average number of employees of Orange, one of the biggest companies on the domestic market in terms of turnover, went up to 1,995 last year, 284 more than in 2004.
Contacted by ZIARUL FINANCIAR, Orange Romania officials had not provided any comment on the 2005 financial results by the time the story was ready for print.
With gross profit in excess of 300 million euros, and turnover of less than 1 billion euros, Orange Romania is one of the market leaders in terms of profit margin (37%) market. Petrom, the biggest domestic company made a 390 million-euro net profit last year against an estimated 3 billion-euro turnover, while Rompetrol Rafinare (Petromidia) derived a net profit worth 51.43 million euros against a 1.6 billion-euro turnover. Sidex, which posted the highest profit in Romania in 2004, logged losses last year.
The leader of the domestic banking market, BCR last year posted 202 million euros in net profit and BRD-SocGen, the second-leading bank on the market, logged almost 154 million euros in net income for 2005.
Orange’s revenues increased by 23% to 239 million euros in the first quarter of 2006, from the same time last year, as a result of the increase in the number of customers by 34% to 7.1 million.
According to previous statements, company officials estimate “the highest subscriber base growth will be on the business segment, rather than the residential segment, but the growth pace will witness a slight slowdown from the previous year.”
France Telecom, the main shareholder of Orange, owns another company in Romania, the integrated communications service provider for corporate clients, Equant.
The French bought 23% in Orange Romania from investment funds in 2005, and paid more than 400 million euros for the stake. The operator was appraised at 1.7 billion euros back then. At the moment, the minority investors in Orange, one of whom is businessman Nicolae Badea, the chairman of Dinamo football club, own a 3% stake. The domestic communications market rose by 20-25% last year, and the revenues of the operators exceeded 3 billion euros for the first time, according to a report of the National Communications Regulation Authority (ANRC). ANRC estimates the communications market will come close to 4 billion euros in 2006.