Pressure on revenues for Orange owner

Steve Dinneen
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ORANGE owner France Telecom yesterday said intense competition in its home market had deflated its first-quarter revenues.

It reported sales of €11.3bn (£10.1bn), roughly in line with expectations, and overall earnings of €3.7bn.

France Telecom lost out on new broadband additions as firms scrabble to attract customers in a fiercely competitive market, ultimately claiming just 20 per cent of the total.

It was also hit by a hike in VAT for telecoms services and the political upheaval in North Africa.

The group was rocked last week when an employee immolated himself in a company car park in Bordeaux, bringing back memories of the spate of suicides at the telecoms giant between 2008 and 2010. More than 20 workers for the company, which is 27 per cent owned by the state, committed suicide last year, with union leaders alleging that working conditions had played a part.

France Telecom’s UK business Everything Everywhere – a joint venture with Deutsche Telekom combining their Orange and T-Mobile units – reported slow growth last week.

The key service revenue figure, which excludes handset sales, grew just 0.4 per cent to £1.6bn in the first-quarter. Analysts expect O2 and Vodafone to post around six per cent and 6.3 per cent respectively.

Total revenues were down 1.7 per cent. In the previous quarter total revenue dropped 1.2 per cent.