Orange Belgium S.A. — Earnings Release 2013

Feb 27, 2014

Full year results 2013 Mobistar

Financial communication

Embargo until 27 February 2014 7.00 a.m. Regulated information

Mobistar meets its 2013 financial guidance while accelerating structural transformation and investments in mobile broadband and convergence

Brussels, 27 February 2014 – Today, Mobistar (Euronext Brussels: MOBB) publishes its results for the financial year 2013. In a highly competitive mobile market, Mobistar meets its 2013 financial guidance while accelerating structural transformation and investments:

• Mobistar delivered its 2013 savings program notably with the transformation of its core distribution, and reconfirms its cost reduction ambition for 2014.
• Mobistar increased investments in its network by 22.8 % and acquired a 4G licence to address the increasing demand for high speed mobile data.
• Mobistar was the first operator to move on the new cable regulation and entered a go-to-market phase targeting a launch before year end.
• Mobistar reached a total turnover of 1,461 million euro vs a guidance of minimum 1,452 million euro.
• Mobistar reached a restated EBITDA of 336 million euro vs a guidance of minimum 300 million euro.
• Mobistar reached a restated operational cash-flow of 137 million euro vs a guidance of minimum 100 million euro.
• The Mobistar group finished the year with 5,177,658 mobile cards connected on its network in Belgium and Luxembourg, an increase of 233,155 compared to last year. Mobistar's M2M customer showed a substantial increase year-over-year partly compensating the decline in both pre- and postpaid subscribers. The MVNO customer base continued on the trend of the previous quarter with 1,209,732 cards connected.
• In Belgium, 89.4 % of Mobistar's residential postpaid customers opted for or were transferred to Mobistar's attractive Animals tariff plans. The part of mobile data in the full year 2013 mobile service revenues in Belgium amounted to 47.7 %, while advanced mobile data(1) represented 17.5 %. The latter showed an increase of 16.6 % year-over-year.
• During the year 2013, the Mobistar group invested 319.0 million euro, including 120 million euro paid to acquire the 800 MHz licence. Excluding the acquisition of the licence, the investment of Mobistar group reached 199.0 million euro, or 15.9 % of the service revenues, compared to 188.5 million euro and 13.0 % a year earlier, the majority part of it were network investments.
• At the end of the year 2013, the Mobistar group recorded a total consolidated turnover amounting to 1,461.3 million euro, 11.5 % below 2012 turnover. The service revenues of the Mobistar group amounted to 1,252.9 million euro in the year 2013, compared to 1,450.0 million euro a year earlier, or a reduction of 13.6 %. Without regulatory impact, the drop in service revenues was limited to 9.6 %, as the reduction in the MTR and roaming tariffs on the service revenues amounted to 33.7 million euro and 23.4 million euro, respectively. The trend noted during the first half year accelerated towards the end of the year due to the repricing effect propagation and a lower pre- and postpaid customer base.
• The positive effect of the transformation of Mobistar's core distribution only started to show results in term of net adds towards the end of the year. The customer loss in the second half of the year 2013 can largely be explained by the development of convergent bundles in the Belgian market and the indirect distribution upheavals as a consequence of the telecom law.

¹⁾ Advanced mobile data: mobile data revenues excluding SMS revenues, including M2M revenues.

• The Mobistar group closed the year 2013 with a restated EBITDA(2) of 335.7 million euro, a decrease of 32.6 % compared to the same period in 2012. The restated EBITDA margin of the Mobistar group reached 26.8 % of the service revenues at the end of 2013, compared to 34.3 % in 2012. The year-on-year evolution is impacted by two positive elements booked in 2012: the reversal of the universal service provision and the release of previous years accumulated provisions for Irisnet for an amount of respectively 17.5 and 9.8 million euro. On a comparable basis, without those one-offs impacts, the 2013 restated EBITDA of 335.7 million euro would compare to a 2012 restated EBITDA of 471.7 million euro, a decrease of 28.8 % year-over-year. The regulatory drag continued to be a burden on the 2013 restated EBITDA with a negative impact of respectively 14.7 and 17.1 million euro related to the reduction in mobile termination- and roaming rates.
• The consolidated net profit of the Mobistar group amounted to 87.4 million euro at the end of 2013, compared to 185.7 million euro a year earlier. The decrease in the net profit is primarily explained by the reduction of the EBITDA, partially compensated by a decrease of the depreciations, financial expenses and income taxes.
• The restated operating cash flow(3), excluding the 800 MHz licence fee, amounted to 136.7 million euro at the end of December 2013 compared to 310.5 million euro a year earlier. The 2013 organic cash flow, excluding the 800 MHz licence fee, amounted to 60.9 million euro, compared to 133.2 million euro a year earlier.
• In December 2013, Mobistar was the first operator to move on with the new cable regulation scheme, officially asking the two main cable companies to provide them with reference offers.
• For the full financial year 2014 the Mobistar group aims to attain a restated EBITDA(4) of between 250 and 280 million euro. This guidance range includes a provision of up to 24 million euro linked to a new tax law on pylons in Wallonia that was voted at the end of 2013. Mobistar plans to file a request for annulment of this law before the Constitutional Court and to file fiscal objections before the competent courts, as Mobistar considers this tax to be discriminatory and disproportionate. However, the prudence concept requires us to account for it. The guidance range also includes the impact of the existing regulatory framework governing mobile interconnection and roaming rates, which will have a revenue and EBITDA impact of respectively 23 and 16 million euro for Belgium and 13 and 7 million euro for Luxembourg. The regulatory framework on MTR's in Luxembourg was only voted in January 2014. The provided guidance range is based on the current market and regulatory context and does not include any impact related to the cable opportunity.

'The structural market imbalance, between an extremely competitive and open mobile market on the one hand and a duopolistic and closed fixed market on the other hand, has been worsening in 2013. In a highly competitive mobile telecom market, whose paradigm has shifted in the past 18 months, Mobistar has kept its focus on delivering its four strategic priorities. The transformation period Mobistar is currently going through is by no means complete, however. On the distribution front the transformation of our indirect channel shall be completed by mid-2014. On the technological front, the refinement of our network continues apace and the foray into 4G looks promising. The regulation of the cable presents new possibilities to build a convergent range of products, which will enable Mobistar to strengthen its relationship with its existing customers and confirm its position as clear first challenger' said Jean-Marc Harion (CEO), and Ludovic Pech (CFO) added: 'We are intensifying our efforts to restructure, simplify and streamline our operations. But we are also reinventing our business models to provide a more cost efficient and robust platform to build upon in the future. In spite of these efforts, the regulatory and the recent additional pylon tax charges continue to be a burden.'

²⁾ EBITDA and restated EBITDA are financial aggregates not defined by IFRS. Restated EBITDA: EBITDA before restructuring and redundancy costs. For further information on the calculation of these aggregates and the reasons why Mobistar uses them, see section 2.2.

³⁾ Restated operating cash flow: restated EBITDA - investments.

⁴⁾ EBITDA and restated EBITDA are financial aggregates not defined by IFRS. Restated EBITDA: EBITDA before restructuring and redundancy costs. For further information on the calculation of these aggregates and the reasons why Mobistar uses them, see section 2.2.

1.	Key facts 5
2.	Comments on the financial situation 7
2.1	Consolidated figures for the Mobistar group 7
2.2	Consolidated income statement 7
	Revenues 7
	Operating expenses 8
	Result of operating activities before depreciation and other expenses 8
	Depreciation and other expenses 9
	Financial results 9
	Taxes 10
	Net profit10
2.3	Consolidated statement of financial position 10
2.4	Consolidated cash flow10
3.	Activities of the Mobistar group by segment11
3.1	Activities in Belgium (Mobistar S.A. and MES S.A.)11
	Mobile activities 12
	Fixed and convergent activities16
3.2	Activities in Luxembourg (Orange Communications Luxembourg S.A.)17
4.	Financial instruments, financial risks management objective and policy18
5.	Disputes18
6.	Significant events after the end of the fourth quarter19
7.	Trends 20
8.	Statutory auditor´s procedures21
9.	Financial calendar21
10.	Shares 21
11.	Declaration by the persons responsible 22
12.	Tables condensed consolidated financial statements in accordance with IFRS 24
12.1	Condensed consolidated statement of comprehensive income (Mio €)24
12.2	Condensed consolidated statement of financial position (Mio €)25
12.3	Condensed consolidated statement of changes in equity (Mio €)26
12.4	Condensed consolidated cash flow statement (Mio €)27
12.5	Segment information (Mio €)28
12.6	Quarterly results30

1. Key facts

2013 was a watershed year for the mobile telephony market in Belgium with a substantial increase in the rotation of customers between operators driven by the new telecom law and an intensified level of competition. Moreover, on the competitive side the structural market imbalance, between an extremely competitive and open mobile market on the one hand and a duopolistic and closed fixed market on the other hand, has been further worsening in 2013. This all resulted in a significant downward repricing of the mobile tariffs.

It is against the backdrop of these evolutions that the Mobistar group stays committed to its four strategic programs, as they are seen as the perfect antidote to cope with these challenges:

Leadership in Mobile:

• The DNA of Mobistar's value proposition remained centred around a number of key differentiating principles: 1/ Guarantee a clear and segmented product portfolio; 2/ No exclusive promo, i.e. no discrimination between new and old customers; 3/ No engagement obligation as Mobistar prefers to build a sustainable relationship with its customers and 4/ competitive prices.
• After it was the first in Belgium to launch operator billing on Android and Windows Phones, Mobistar joined in December the Mobile Wallet initiative, Sixdots, as a commercial partner. Mobistar customers will have the ability to link their existing credit and debit cards to this application to perform mobile payments in a simple manner.
• Mobistar's network market share continued to grow gradually in 2013 as a result of the growth in its Machineto-Machine and MVNO businesses. With 5,075,479 SIM cards connected on its network in Belgium, an increase of 4.9 % year-over-year, Mobistar positions itself alongside the historical incumbent, and well ahead of the nr. 3 player who stays below the threshold of three million connected SIM cards. In a capital intense industry such as the telecommunications, it creates the economies of scale enabling quicker return on investments.
• In November 2013 Mobistar acquired a frequency block of 2x10 MHz in the 800 MHz band for a 20 year period. Mobistar acquired the lot with the most ambitious coverage obligations and confirms herewith its ambition to deploy the best 4G network in Belgium.
• In November 2013 Mobistar opened up its 4G network to thousands of its customers in 30 cities and towns in Belgium, allowing them to discover the benefits of very high speed mobile broadband. As Mobistar wants to guarantee a flawless experience of its 4G services, it has set itself high standards before declaring a 4G city open. It prefers to provide an homogeneous and qualitative coverage before a nationwide commercial launch.
• Mobistar continued the upgrade of its transmission network and backhaul with microwaves or fiber high capacity links.
• Mobistar's 'Highway' project is gaining speed. It aims to further strengthen the customer experience of the Mobistar network on the highways in Belgium. Extensive drive tests through the country allow Mobistar to identify meshed blind spots in the network. Once detected, adequate actions are taken to assure a consistent user experience.
• Mobistar has stepped up its efforts to communicate on a personalized and transparent basis with all its customers on the improvements it has and is constantly undertaking to provide its customers with a highly performing mobile network.

Pioneer in Disruptive Convergence:

• After having launched earlier in the year 1/ International on Unlimited; 2/ Mobistar to Mobistar voice and 3/ Everywhere Multi (sharing the same data bundle on several devices), Mobistar launched in the fourth quarter of 2013 as first operator in Belgium its own Mobile Cloud solution. Dolphin subscribers get 500 MB of Mobile Cloud storage space included, while Panther subscribers get 16 GB of space included. Importantly, the Mobile Cloud service can be accessed for free via the mobile network (i.e. not consuming any volume from the bundle).
• Mobistar has further developed its business portfolio, Mobistar Matrix Solutions, which offers a modular

approach tailored to the needs and situation of its business customers. The fixed-mobile convergence Mobistar offers its clients is one of the cornerstones of Mobistar Matrix Solutions concept. In the fourth quarter Mobistar enhanced its offering with the launch of its Mobile device Management solution for enterprises.

• In the fourth quarter, Mobistar's subsidiary, Orange Communications Luxembourg, started to commercially leverage the deal it has signed with the cable company Eltrona Telecom. It offers its residential customers convergent services combining fixed and mobile telephony, high-speed Internet access via fixed and mobile broadband and a new digital television offer. The preliminary results are very encouraging as almost 30 % of the customers are new clients without prior mobile subscriptions with Orange Communications Luxembourg. The expertise gained in the management of this process comes in handy, now that the wholesale cable regulation in Belgium has been published. Mobistar consequently confirms its plans to re-launch TV- and broadband services in Belgium towards the end of 2014.

Best Customer Experience:

• In the fourth quarter Mobistar celebrated the opening of its first innovative store concept, named @Mobistar, in the city of Liège. In the course of 2014 additional openings are planned. The concept stores are four times larger than the current Mobistar Centers with an extended portfolio of mobile devices and services.
• Mobistar stepped up its focus on securing that all customer journey encompass a tight integration of all touch points across the organization, i.e. Mobistar Centers, call centers, online support and also, increasingly, social media CRM channels such as Twitter and Facebook.
• Mobistar also launched "Lifestyle Zones" in its stores, each dedicated to a unique purpose. The stores also feature a new area dedicated to free workshops where customers can learn to use the advanced features on their smartphones. Consumers will also be able to test a wide range of devices and applications live, have their smartphone repaired and make an appointment for professional advice. All these initiatives strengthen Mobistar's promise as 'digital coach' for its customers.
• While innovation is taking an increasingly important position in the heart of the organisation, Mobistar raises the interaction with its customers, by testing products and services before they are launched commercially. This to improve and optimise the functions and the customer experience of these innovations: User centric product development ensures high quality products that address the needs of customers.

Best Industry Efficiency:

• More than one year after the start of the ACE-program Mobistar's corporate culture is fully embracing the idea that operational transformation is not just a necessary evil, but is in fact an essential pathway to prepare the Mobistar of tomorrow.
• At the end of December 2013, the total gross savings realised within the framework ACE1, launched in July 2012, amounted to 62.9 million euro, exceeding the budgeted target by 2.9 million euro. The key contributors to this program were network transmission optimizations, the implementation of E-billing solutions, the increased focus on bad debt prevention, energy consumption reduction and overall discipline and dedication towards cost management.
• Mobistar reconfirms its commitment to realize a net operating costs saving of 50 million euro this year, thanks to its efficiency programme ACE2 and to the systematic improvement of all company processes(1). The phasing out of the satellite TV service was already realized in September 2013. In the fourth quarter the company mainly made progresses in the shift toward owned or controlled distribution channels with a reduction of its selling fees. The initiative embarked in this domain should gradually start to show off, resulting in a more cost-effective and a more efficient distribution. Further, Mobistar implemented stringent action to smoothen the customer relations process by implementing digital solutions. Finally Mobistar also prepared the strategic steps to review its network- and IT operations business model, allowing it to start with the implementation in the course of 2014.

¹⁾ Excluding the tax pylon impact of up to 24 million euro.

• As a result of the numerous process simplification exercises Mobistar reduced its headcount by 130 to end the year with 1,587 employees in Belgium, with a peak in the number of leavers in the fourth quarter. The 'Employability Scan' is a process offered to Mobistar's employees over a given time to actively support them in the search for a new role within the Mobistar Group when its former role has disappeared following a reorganization within his department. If there is no redeployment possible the employee will be dismissed for reason of reorganisation and will be able to benefit from an outplacement program.

2. Comments on the financial situation

2.1 Consolidated figures for the Mobistar group

Mobistar group´s consolidated key figures	Full Year 2013	Full Year 2012	Variation
Total number of connected SIM cards (Mobistar S.A., Orange	5 177 658	4 945 503	+4.7 %
Communications Luxembourg S.A. and MVNOs)
Consolidated turnover (million €)	1 461.3	1 650.5	-11.5 %
Service revenues (million €)	1 252.9	1 450.0	-13.6 %
Handsets revenues (million €)	208.4	200.5	+3.9 %
Restated EBITDA(2) (million €)	335.7	499.0	-32.7 %
Restated EBITDA margin in % of service revenues (million €)	26.8 %	34.4 %
EBITDA (million €)	317.1	494.1	-35.8 %
EBITDA margin in % of service revenues	25.3 %	34.1%
Consolidated net profit (million €)	87.4	185.7	-52.9 %
Net profit per ordinary share(3) (€)	1.46	3.09	-52.9 %
Net investment (million €) excl. 800 MHz licence	199.0	188.5	+5.6 %
Net investment/Service revenues	15.9 %	13.0 %
Restated operational cash flow(4)	136.7	310.5	-56.0 %
Operational cash flow (million €)	118.1	305.6	-61.4 %
Organic cash flow(5) (million €) excl. 800 MHz licence	60.9	133.2	-54.3 %

The consolidation perimeter has not evolved since 31 December 2012 and includes Mobistar S.A. (100 %), Mobistar Enterprise Services S.A. (100 %), Orange Communications Luxembourg S.A. (100 %) and IRISnet S.C.R.L. (accounted for by equity method - 28.16 %).

2.2 Consolidated income statement

Revenues

The service revenues of the Mobistar group amounted to 1,252.9 million euro in the year 2013, compared to 1,450.0 million euro a year earlier, or a reduction of 13.6 %. The negative trend noted during the first half year continued its acceleration especially towards the end of the year due to the propagation of the repricing effect and the lower pre- and postpaid customer base. Pockets of growth were the service revenues coming from machine-

^{2) (}Restated) EBITDA: Earnings Before Interest, Taxation, Depreciation and Amortisation.

³⁾ Weighted net profit per ordinary share (IFRS).

^{4) (}Restated) operational cash-flow = EBITDA – investments excl. 800 MHz licence.

⁵⁾ Organic cash flow = net cash flow from operations, less acquisitions of tangible and intangible assets, plus proceeds from disposals of tangible and intangible assets.

to-machine and from MVNO, which grew respectively 20.7 % and 59.6 % in 2013. The fourth quarter service revenues of the Mobistar group amounted to 290.2 million euro, a decline of 21.4 % versus the fourth quarter of 2012. Considering the timing of the repricing the fourth quarter of 2013 should turn out as the inflection quarter in terms of negative service revenue growth.

During the year 2013, the revenues of the Mobistar group were once again negatively influenced by the reduction of the MTR rates in January 2013 and of the roaming rates in July 2012 and July 2013. The impact of these reductions on service revenues of the Mobistar group amounted to in total 57.1 million euro for 2013, i.e. 33.7 million euro MTR-impact and 23.4 million euro roaming-impact. The impact in the fourth quarter amounted to respectively 8.8 million euro and 3.6 million euro. Without regulatory impact, the consolidated service revenues would have been down 9.7 % for the full year 2013 and down 18.1 % for the fourth quarter.

The sales of handsets, mainly driven by the success of smartphone continued to progress during 2013 from 200.5 million euro in 2012 to 208.4 million euro, an increase of 3.9 %. However, the growth trend curbed off toward the second part of the year. The fourth quarter even recorded a decline of 17.8 % versus the same period last year, given the later introduction of the new iPhone in Belgium compared to last year and given the gradually increasing volume of subsidized offers in the market.

The total consolidated turnover, which includes services revenues as well as the turnover coming from the sale of handsets, amounted to 1,461.3 million euro at the end of December 2013, compared to 1,650.5 million euro on December 2012. This implies a decline of 11.5 % year-over-year, excluding the impact of MTR- and roaming regulation the decline would have been -8.0 % year-over-year. The total consolidated turnover in the fourth quarter decreased by -20.8 % compared to the fourth quarter of 2012.

Operating expenses

The total operating expenses, excluding depreciations, amounted to 1,144.2 million euro at the end of December 2013, compared to 1,156.4 million euro at the end of December 2012.

The direct costs amounted to 697.5 million euro at the end of December 2013 compared 758.3 million euro at the end of December 2012, a decrease of 8.0 %. In the fourth quarter of 2013 the decrease in direct costs was more pronounced with a reduction of 18.9 % to 184.8 million euro compared to 231.2 million euro in the fourth quarter of 2012. The interconnection costs decreased due to the effect of regulation for MTR and roaming and the decline of interconnect costs linked to the wholesale carrier DSL activities. The 2013 cost of sales of equipment and goods sold were mainly impacted by the evolution in cost of sales of the handsets. The increase is in line with the revenue increase.

The indirect costs amounted to 446.7 million euro at the end of December 2013 compared to 398.1 million euro at the end of December 2012, an increase of 12.2 % year over year. This increase is largely explained 1/ by two positive elements booked in 2012 and 2/ by the negative impact on 2013 figures of the restructuring charges in the context of the reorganisation of the indirect distribution of 8.8 million euro and the higher redundancy charges of 9.8 million euro booked in 2013 (vs. 4.8 million euro in 2012).

Result of operating activities before depreciation and other expenses

The 2013 EBITDA amounted to 317.1 million euro, which compares to an EBITDA of 494.1 million euro a year earlier. The EBITDA margin of the Mobistar group reached 25.3 % of the service revenues at the end of 2013, compared to 34.1 % in 2012. The 2013 EBITDA includes 9.8 million euro of redundancy costs (6.2 million euro higher than those of 2012) and 8.8 million euro of restructuring costs in the context of the reorganization of the indirect distribution.

Restated EBITDA does not constitute a financial aggregate defined by IFRS as an element of measurement of financial performance and cannot be compared with similarly titled indicators from other companies. Restated EBITDA represents supplementary information and should not be considered a substitute for operating income. The reason why Mobistar is using this presentation is to facilitate comparison of operational performance. The following table shows the transition from EBITDA to restated EBITDA.

EBITDA restatements (in Mio €)	FY 2013	FY 2012	Variation
Restated EBITDA	335.7	499.0	-32.7 %
- redundancy costs	-9.8	-4.8
- other restructuring costs	-8.8
EBITDA	317.1	494.1	-35.8 %

The Mobistar group closed the year 2013 with a restated EBITDA of 335.7 million euro, a decrease of 32.7 % compared to the same period in 2012. The restated EBITDA margin of the Mobistar group reached 26.8 % of the service revenues at the end of 2013, compared to 34.4 % in 2012. The year-on-year evolution is impacted by two positive elements booked in 2012: the reversal of the universal service provision and the release of previous years accumulated provisions for Irisnet for an amount of respectively 17.5 and 9.8 million euro. On a comparable basis, without those one-offs impacts, the 2013 restated EBITDA of 335.7 million euro would compare to a 2012 restated EBITDA of 471.7 million euro, a decrease of 28.8 % year-over-year. The regulatory drag continued to be a burden on the 2013 restated EBITDA with a negative impact of respectively 14.7 and 17.1 million euro related to the reduction in mobile termination- and roaming rates.

EBITDA one-offs (in Mio €)	FY 2013	FY 2012	Variation
Restated EBITDA excluding one-offs	335.7	471.7	-28.8%
- universal service reversal		+17.5
- Irisnet previous years provisions release		+9.8
Restated EBITDA	335.7	499.0	-32.7%

Depreciation and other expenses

Depreciation charge as at 31 December 2013 totalling 188.3 million euro is reduced by 13.3 % versus the one recorded for the same period in 2012. The depreciation of 2012 included the impact of the review of the useful life of the assets related to important projects in IT system and network renewal, i.e. an additional 14.0 million euro in 2012, and an accelerated depreciation of 15.0 million euro recorded to reflect a change in the IT billing-system in the second semester of 2012. In 2013 there has been no further impact related to the IT system and the impact related to the network renewal has been marginal. The decision to suspend the commercialisation of the fixed services to the residential market led the company to review the useful lives of the assets related to these activities. A negative impact of 0.8 million euro has been booked during the first semester of 2013. No major impacts have been recorded in the books in the second semester 2013.

Financial results

The financial expenses have been influenced in 2013 by interests rate and exchange rate variance (-2.5 million euro), and bank charges (-0.3 million euro). The new credit line of 120 million euro secured in December 2013, was drawn for an amount of 100 million euro at the end of december to pay the 800 MHz spectrum license. The impact of this credit facility extension on the 2013 financial results was very limited.

Taxes

The tax burden amounts to 33.4 million euro in 2013. A positive impact on the taxable year 2012 has been recorded in December 2013 for an amount of 6.2 million euro to record tax deduction for investments. In 2012 the impact was of 7.0 million euro. Due to the fact that the taxable basis is lower in 2013 than in 2012, the adjustment has had an impact on the effective tax rate which shows a more favourable position in 2013 compared to 2012.

Net profit

At the end of the year 2013, the Mobistar group recorded consolidated net profit of 87.4 million euro, a decrease of 52.9 % in comparison with the 185.7 million euro at the end of December 2012.

Net profit per share decreased by 52.9 % from 3.09 euro per share on 31 December 2012 to 1.46 euro per share a year later.

2.3 Consolidated statement of financial position

The consolidated statement of financial position total reached 1,449.9 million euro on 31 December 2013, compared to 1,347.0 million euro at the end of the previous financial year.

Non-current assets, including deferred taxes assets, amounted to 1,171.1 million euro at the end of December 2013, compared to 1,045.8 million euro at the end of 2012. The acquisition of the 800 MHz license has had an impact of 120.0 million euro in the year-over-year evolution of the intangible assets. The tangible assets also increased as a result of the persistent investments in the Mobistar network.

Current assets decreased from 301.2 million euro at the end of 2012 to 278.8 million euro at the end of December 2013, mainly due to a decrease of trade and other receivable amounts triggered by the lower revenue base.

Non-current liabilities increased due to the increase in long-term borrowing drawings resulting from the need of financing related to the acquisition of the 800 MHz licence (from 383.7 million euro end of 2012 to 548.8 million euro at the end of December 2013).

Current liabilities decreased from 524.7 million euro on 31 December 2012 to 493.0 million euro at the end of the year 2013. This decrease is mainly due to a decrease in tax payable (-27.1 million euro linked to the payment of the remaining part of 2012 corporate taxes) and in deferred income (-11.3 million euro) compensated by a small increase of the trade payable (7.5 million euro).

2.4 Consolidated cash flow

At the end of December 2013, the organic cash flow of the Mobistar group amounted to -59.1 million euro, compared to 133.2 million euro a year earlier, including the 120 million euro payment of the license.

During the year 2013, the Mobistar group invested 319.0 million euro, including 120.0 million euro for the acquisition of the 800 MHz license. Excluding the license costs, the investments amounted to 15.9 % of service revenues, compared to 188.5 million euro a year earlier. The investments performed during the financial year 2013 are in line with the investment program 2013-2015, announced in February of this year. The focus of the second semester of 2013 was on the finalization of the swap of the 2G/3G network with more efficient infrastructure, in order to improve the deep indoor coverage, on the extension of the UMTS capacity, on the increase of the speed on the mobile data network, and finally the deployment of new sites in order to improve the customer experience on mobile voice and data traffic. Towards the end of the year Mobistar ramped up the build out of its 4G network. End December 2013, Mobistar had a 3G/HSDPA coverage of 98.8 % of the population. The Mobistar network had 6,358 sites at the end of December 2013, of which 753 are shared with other operators. Mobistar continued to invest in the improvement of his network transmission by using extra microwaves and fiber.

The decrease in the 2013 organic cash flow compared with the full year 2012 comes from the combination of several factors:

• Decrease in the 'adjusted result of operating activities' (-192.9 million euro), driven by the EBITDA decrease;
• Change in working capital (53.3 million euro), mainly related to the increase of cash inflows related to current receivable and decrease of cash outflows related to current payable;
• Increase in acquisition in fixed assets (-130.5 million euro) driven by the increased amount of investment of the year and the acquisition of the 800 MHz licence and variance of fixed assets related trade payable (-22.2 million euro);
• Decrease in tax payment (+98.4 million euro) as only 2013 down payment (24 million euro) and payment of tax bill 2012 (32 million euro) have been recorded in 2013, while in 2012 Mobistar had to pay both the tax bill of 2010 and 2011 (respectively 51.0 and 54.0 million euro) on top of the 2012 down payment (50 million euro).

3. Activities of the Mobistar group by segment

In greater detail, the activity of the Mobistar group via its segments breaks down as follows:

3.1 Activities in Belgium (Mobistar S.A. and MES S.A.)

Key financial figures of Mobistar S.A.	Full Year 2013	Full Year 2012	Variation
ARPU(6)(€/month/active customer)	25.13	28.74	-12.6 %
Service revenues (million €)	1 211.9	1 400.3	-13.4 %
Of which Mobile	1 067.2	1 240.0	-13.9 %
Of which Non-Mobile	144.7	160.3	-9.7 %
Total turnover (million €)	1 422.1	1 605.3	-11.4 %
Direct earnings	744.9	863.5	-13.7 %
Of which Mobile	659.9	790.5	-16.5 %
Of which Non-Mobile	85.0	73.0	+16.4 %
EBITDA (million €)	303.8	482.6	-37.1 %
Of which Mobile	289.4	492.3	-41.2 %
Of which Non-Mobile	14.4	-9.7	na
Key operating figures of Mobistar S.A.	Full Year 2013	Full Year 2012	Variation
Total number of connected SIM cards	5 075 479	4 839 698	+4.9 %
Total number of active customers (mobile telephony, IEW)	3 170 056	3 432 060	-7.6 %
Total number of active M2M SIM cards	695 691	518 098	+34 3 %
Total number of MVNO customers (mobile telephony,
incl. full MVNO)	1 209 732	889 540	+36.0 %
Total number of mobile Internet customers	115 564	154 093	-25.0 %
Total number of ADSL customers	47 202	71 985	-34.4 %
Total number of digital TV customers	0	27 846	-100.0 %
Total number of active fixed telephone lines	200 634	233 342	-14.0 %

Against the background of a mild European economic revival, the Belgian economy has picked up with a glimmer of very low, but positive economic growth. Towards the end of the year the economic sentiment indicators turned out more positive. Though at the same time the unemployment rate in Belgium has further picked up and the number of defaults stayed at a high level. On the competitive side the structural market imbalance, between an extremely competitive and open mobile market on the one end and a duopolistic and closed fixed market on the other end, has been further worsening in 2013. An incomplete regulatory and political framework has culminated in a steep decrease of mobile prices, while in general prices of fixed line products have increased.

Mobile activities

Market Review

2013 was a watershed year for the mobile telephony market in Belgium with 1/ a substantial increase in the rotation of customers between operators driven by an intensified level of competition and 2/ a significant downward repricing of the mobile tariffs.

The customers rotation amongst the different operators increased driven by the entry into force of the new telecom law in October 2012. Since that date, there is a stronger growth in the quantity of number portability. This trend has only been witnessed in the mobile market and not in the fixed market, although the new law applied to both markets. Due to the mobile market turmoil already alluded to here above, all mobile network operators including Mobistar had to repeatedly adjust pricing of their postpaid tariff plans, as to remain relevant and competitive in the market. Besides the regulatory context, as the key driver of disruption in the mobile market, the advent of a fixed network operators as mobile service providers, has to be taken into account.

On the positive side, 2013 was the year in which mobile data traffic soared. Today, the usage of high speed mobile broadband internet finds itself at a critical tipping point. The rapid expansion in mobile broadband service and the rise of iconic smartphones and connected devices have combined to create an unprecedented level of demand for mobile data by the Belgian consumers.

The rise in mobile data traffic in Belgium has been fuelled by a number of factors. Historically, Belgium has been lagging in terms of smartphone penetration as handset subsidization was not a market practice prior to 2009 as it was forbidden by law. Since then mobile network operators have shied away from transforming the Belgian market into a structural subsidization market, rather operators applied a more tactical approach to handset subsidization. This implies that Belgian consumers are accustomed to primarily buying their own smartphones. In 2013 the adoption rate of smartphones finally kicked in in Belgium. In turn these devices boosted mobile data usage. Consumption of rich media and video increased substantially in 2013. They require significantly more bandwidth and consume greater capacity than traditional email or text-based messaging services. Another important reason for the proliferation of mobile broadband is the strong improvement of the mobile network, following the continued investments to improve coverage, reliability of the services and speed.

Financial Review

The blended average revenue per user (ARPU) has fallen meaningfully in 2013, from 28.74 euro/month/customer end 2012 to 25.13 euro/month/customer a year later, triggered by the heavy repricing in the Belgian mobile market following the shake-up in the market evoked by the new telecom law. In 2012 and 2013 Mobistar progressively moved to an integrated product offering with voice, sms and mobile data included within the bundle. In fact the repricing materialized itself most by a significant reduction in domestic, mainly voice, out-of-bundle revenues, as the bundles were enriched with more content, reducing overage. At the end of the year the out-of-bundle portion of the ARPU has already materially decreased. Once the propagation of the repricing has completed, the lower out-of-bundle portion of the ARPU provides a much healthier starting point for the future. In addition to the repricing the ARPU edged down due to the impact of regulation (reductions in mobile termination and roaming rates).

The mobile service revenues in Belgium declined respectively 13.9 % and 21.3 % during the year 2013 and the fourth quarter of 2013. In particular the overall market repricing as explained above caused the service revenues to decline, in addition to the lower pre- and postpaid customer base (-262,004 year-over-year in 2013). The customer loss in the second half of the year can largely be explained by the development of convergent bundles and the indirect distribution upheavals as a consequence of the telecom law. The weak commercial performance of Euphony (in severe financial distress) and The Phone House (in closer integration after the acquisition by Belgacom), two historical Mobistar's indirect distribution partners, could not be fully mitigated in 2013. The positive effect of the transformation of Mobistar's core distribution only started to show positive results towards the end of the year in the B2C segment.

The part of mobile data, i.e. SMS and advanced mobile data, in the full year 2013 mobile service revenues in Belgium amounted to 47.7 %, while advanced mobile data represented 17.5 %. The latter showed an increase of 16.6 % year-over-year. The relative importance of mobile data within the postpaid segment is rapidly increasing. Although modest in size, we do notice an uptick in mobile data roaming revenues in the postpaid segment as roaming prices within Europe are gradually converging to a level where Mobistar's customers are getting more comfortable to use their smartphones abroad. The use of mobile data in the prepaid segment remains rather limited, especially mobile data roaming is almost inexistent in this segment.

Service revenues coming from machine-to-machine increased 20.7 % to 19.3 million euro in 2013 coming from 16.0 million euro in 2012. Service revenues coming from MVNO activities increased 59.6 % to 62.3 million euro in 2013 coming from 39.2 million euro in 2012. In both case the substantial revenue increase was driven by a considerable increase in the respective customer bases, i.e. +177,593 and +320,192.

The direct margin, as a percentage of mobile service revenues in Belgium, decreased a 191 basis points in 2013 ending at 61.8 % versus 63.8 % in 2012. The direct earnings came out 130.6 million euro lower than the previous year at 659.9 million euro versus 790.5 million euro in 2012, largely explained by lower service revenues. The EBITDA of the mobile activity in Belgium amounted to 289.4 million euro at the end of December 2013 coming from 492.3 million euro at the end of December 2012, implying a decrease of 202.9 million euro throughout 2013. Once again, the negative impact of the regulator´s decisions weighed heavily on the profitability, but the erosion of the core profitability following the massive repricing in the Belgian mobile market is the main driver for this decline. On top of these elements there is the unfavourable comparison of the non-recurring elements that skew the comparison versus 2012 negatively for 2013. The EBITDA margin of the mobile activity in Belgium came to 27.1 % in 2013, compared to 39.7 % in 2012.

Operational Review

Product Offering

The DNA of Mobistar's mobile customer value proposition remained centred around a number of key principles: 1/ Guarantee a clear and segmented product portfolio; 2/ No discrimination between new and old customers; 3/ No engagement. Mobistar wants to build a sustainable relationship with its customers and 4/ Mobistar warrants competitive prices.

After the significant repricing that occurred in the second quarter of 2013, Mobistar in the course of November further enhanced its product portfolio with a clear focus on segmentation with a potential upselling path to richer data bundles. The Kangaroo tariff plans are suited for people who do not want to have mobile data within their bundle, and hence do not want to pay for it. People eager for mobile data are either served by the entry level of the Dolphin-series or by the abundance of the Panther-series. After having launched International on Unlimited; Mobistar to Mobistar Voice and Everywhere Multi (sharing the same data bundle on several devices), Mobistar launched in November a Mobile Cloud solution as its most recent differentiator. Dolphin subscribers get 500 MB of Mobile Cloud storage space included, while Panther subscribers get 16 GB of space included. The Mobile Cloud service can be accessed for free via the mobile network (i.e. not consuming any volume from the bundle). Further, Mobistar also removed the optionality of the Promo For Life (i.e. a 20 % discount when engaging for a six months period) and automatically integrated the 20 % discount in all its tariff plans. In practices a large part of the Mobistar customers already benefited from the Promo For Life. By taking this step Mobistar further simplified its portfolio.

In the course of the fourth quarter Mobistar opened up its 4G network for both residential as well as business customers. Residential clients using a subscription including mobile data (Dolphin or Panther) or those who use an Internet Everywhere formula, have received extra 4G surf volume on top of their subscription to try out the 4G technology if they use a 4G compatible device (smartphone or tablet). In the first half of 2014, Mobistar will add at least 40 cities and towns to its 4G network. By 2015 Mobistar plans to have the same 4G coverage as today's 2G coverage.

At the end of December 2013, close to 1 million tariff changes have taken place over the last 12 months. Mobistar continued to offer its personalised tariff recommendations, which in most cases resulted in a more advantageous solution for the customer. The majority of the tariff changes were triggered by Mobistar and not by the customer, either through the proactive migration of the My-customer or through the use of the Personal Check up service. This underscores Mobistar pro-activeness and commitment towards its customers to make sure customers are at the tariff plan that is best aligned with their usage. Thanks to these initiatives, 89.4 % of the residential postpaid customers have opted for an ´Animal´ tariff plan. The remaining part of postpaid customers that are not on an ´Animal´ tariff plan, are mainly customers that are on a very basic tariff plan for which a migration towards an Animal would result in a tariff plan with more content at a higher price. An example of such a tariff plan is for instance the Mobistar BestDeal tariff plan which is priced at 5 euro, upgrading this tariff plan to an Animal would result in a migration towards the Kangaroo 8 which is priced at 8 euro.

In view of the progression it already achieved in repricing its customers, Mobistar on December 23 also gave its full engagement and subscribed the covenant that was prepared by the Minister of Economy. Mobistar committed itself to make sure that 90 % of all residential postpaid customers (fixing date September 1, 2013) using a rate plan that was launched before January 1, 2012, have switched to a more favourable tariff plan. This target needs to be achieved by all signatories before September 30, 2014.

Customer evolution

Mobistar's network market share continued to grow gradually in 2013 as a result of the growth in its own Machineto-Machine business, but also thanks the growth of its MVNO partners. At the end of 2013, Mobistar (Mobistar S.A. + MVNO) had a total of 5,075,479 SIM cards connected on its network, compared to 4,839,698 a year earlier, an increase of 4.9 % year-over-year.

The number of active mobile telephony (incl. IEW) Mobistar customers decreased to 3,170,056 coming from 3,432,060 a year earlier, implying a decrease of 7.6 % year-on-year. The majority part of this decline is due to the fall in the number of prepaid customers (-13.3 % year-on-year), which is a reflection of the overall decline in the Belgian prepaid market segment. Also in the fourth quarter of 2013 the number of prepaid customers continued to decline. As opposed to 2012 when the number of postpaid customers rose slightly, 2013 saw a decrease in the number of postpaid subscribers (-5.0 % year-on-year). The decline in postpaid customers is the result of 1/ the new legislation introduced in October 2012 allowing customers to switch providers after six months, free of charge, triggering more churn; 2/ increased competition of convergent players in the residential market, especially from Telenet that established itself as the fourth operator in Belgium; 3/ increased competition in the postpaid, low-end enterprise (SOHO) market segment and 4/ a reduction in the number of mobile broadband cards as the ubiquity of modern smartphones has reduced the need for second SIM cards. Besides the arguments already rose above, the commercial performance has also been impacted by the changes in Mobistar's own distribution mix. The transformation of Mobistar's distribution will be detailed in the section below.

At the end of 2013, Mobistar recorded 695,691 active SIM cards in the area of ´machine-to-machine´ (M2M) applications, an increase of 34.3 % compared to the 518,098 active cards recorded at the end of 2012. Mobistar is really seen in Belgium as the telecommunications leader in the Belgian M2M value chain. The M2M & Connected Devices event, co-hosted by Mobistar for the 8th time, was a clear success. The event brought together a group of more than 500 application providers, hardware suppliers, venture capitalists, specialized press, consultants, professional organizations and customers who have a dedicated focus on M2M and Connected Devices. In order to maintain this leading position, Mobistar has a dedicated team for M2M business activities, including marketing communications, product marketing, sales support, platform support and partnership management. This is necessary to best address the unique aspects of the M2M ecosystem, which include long sales cycles, intensive presales efforts and a solutions-based sales approach. The fact that Mobistar has pioneered long ago is now rendering extremely positive results.

Mobistar's MVNO partner program is based on alliances with partners that have a strategic fit. Those partners either possess a differentiating factor by providing value added services or they are able to leverage on a lower cost structure in terms of acquisition and retention or in terms of cost to serve. At the end of 2013, Mobistar S.A. had 1,209,732 MVNO customers, compared to 889,540 MVNO customers at the end of 2012, an increase of 36.0 % in one year.

Distribution Transformation

In the course of 2013 Mobistar has heavily scrutinized its distribution strategy and has laid a solid foundation for the future. This strategic review was triggered by the shorter contract duration imposed by the new telecom law in October 2012.

In 2013 Mobistar built further on developing the fundamentals:

• Mobistar created the building blocks of its online real estate by launching a new B2C- & B2B website, boosting its presence on social media and making sure that the back-end is robust;
• Mobistar further strengthened its IT footprint to leverage multichannel opportunities, allowing to address the customer with one tone of voice across all customer touch points, no matter whether the customer presents itself in a shop, online, through a phone contact and regardless whether it concerns a direct or indirect, exclusive touch point;
• Mobistar initiated a rationalization exercise of its direct distribution footprint with the ambition to close down 30 shops before the end of 2015 and to tighten the relationship with all distribution channels;
• Mobistar launched its first innovative store concept, named @Mobistar, in the city of Liège, to meet new market trends. In the course of 2014 additional openings are planned. The concept stores are four times larger than the current Mobistar Centers with an extended portfolio of mobile devices and services. Mobistar developed these new concept stores, as a way "to make the story of high-speed mobile data come alive." The new store plans to do that by creating clear-cut "Lifestyle Zones" in the store, each dedicated to a unique purpose. The store also features an area dedicated to free workshops where customers can learn to use the advanced features on their smartphones. Consumers will also be able to test a wide range of devices and applications live,

have their smartphone repaired and make an appointment for professional advice. Additionally, the company will integrate its online system with its retailing system to improve the customer experience.

Fixed and convergent activities

Market Review

Due to its imperfect market structure, true competition in the fixed-line telephony and Internet markets remained also absent in 2013. The existing players mainly focused on product rather than on price competition. The lack of proper competition resulted in a further concentration of market share in the hands of the historical incumbent and cable operators, allowing them to enforce higher prices towards the fixed-line telephony and Internet consumers. In addition convergent operators have been using "cross subsidization" of mobile services by leveraging on their packs, where subscriber inertia creates room for yearly price increases.

Financial Review

The non-mobile service revenues in Belgium declined respectively 9.7 % and 20.4 % during the year 2013 and the fourth quarter of 2013, mainly as a result of lower wholesale carrier service revenues and to a lesser extent due to lower residential fixed revenues. The remaining non-mobile service revenues, primarily within the perimeter of Mobistar B2B activities, remained rather solid.

The direct earnings of the non-mobile activity in Belgium registered an increase of 16.4 % to 85.0 million euro at the end of 2013 coming from 73.0 million euro at end of 2012. The direct margin, as a percentage of the non-mobile service revenues, improved from 45.5 % in 2012 to 58.7 % a year later, mainly due to a more favourable product mix. The progression is almost exclusively due to a reduction in the interconnection costs, both as a result of lower mobile termination rates and lower leased line charges related to wholesale carrier services. At the end of 2013, the EBITDA of the non-mobile activity in Belgium came out at 14.4 million euro compared to -9.7 million euro in 2012. Besides the improvement of the direct earnings, this progression was mainly linked to the suspension of the commercialization of the TV- and broadband product, which caused the EBITDA to improve due to lower interconnection costs, lower instalment costs, lower customer assistance related costs and lower marketing costs.

Operational Review

In May of 2013 Mobistar has announced to suspend commercialization of its fixed residential portfolio (satellite digital TV, ADSL broadband internet, fixed voice) as this was a loss-making business. In September 2013 Mobistar switched off its digital satellite TV service. At the same time Mobistar has been acting as the driving force behind the regulatory "Open cable" project in Belgium. Mobistar can look back with partial satisfaction to the milestone that was reached in December 2013: regulatory approval of the opening up of the Belgian cable networks in all three regions for wholesale broadband and analogue/digital TV services. The wholesale cable regulation has now entered into its implementation phase. This regulatory package is the result of a multifaceted process involving various regulators and cable operators, and should be considered as a first step in a long-term strategic direction to make TV and fixed broadband markets in Belgium more dynamic in the years to come. For this to happen, Mobistar relies on the regulators to ensure that the regulated conditions over time meet the requirements highlighted by the European Commission, being that an efficient alternative operator should be able to enter the market in a profitable way. Mobistar also notes the CRC decision to adapt the retail-minus calculation for non-regulated services (VooFoot & fixed telephony) and that the CRC will apply additional corrections for the other non-regulated services in the future.

The formal letters of intent were issued by Mobistar end 2013 to Telenet, Brutélé and Tecteo, and the mandated set-up fees were paid. In the coming months, Mobistar will proceed its go to market efforts as to reconfirm its relevance as a convergent operator for residential packs towards the end of 2014. As this is a market where it plays a challenger role, and without a legacy burden, Mobistar has a unique opportunity to market innovative products and services, playing on its 'mobility' reputation that will appeal to a broad demographic, at very competitive rates.

At the end of 2013, Mobistar S.A. had 47,202 ADSL customers, compared to 71,985 ADSL customers a year earlier, a decrease of 34.4 %. The number of active fixed telephone lines of Mobistar S.A. declined by 14.0 %, going from 233,342 active lines at the end of 2012 to 200,634 active lines at the end of 2013. At the end of 2013, Mobistar S.A. digital satellite TV customer base was completely phased out.

Key financial figures of Orange Communications Luxembourg S.A.	Full Year 2013	Full Year 2012	Variation
Service revenues (million €)	65.3	65.5	-0.3 %
Total turnover (million €)	75.6	75.5	+0.1 %
Direct earnings (million €)	34.9	35.3	-1.2 %
EBITDA (million €)	13.2	11.5	+15.1 %
EBITDA-margin	20.3 %	17.6 %
Key operating figures of Orange Communications Luxembourg S.A.	Full Year 2013	Full Year 2012	Variation
Total number of active customers (mobile telephony)(7)	102,179	105,805	-3.4 %
ARPU(8) (€/month/active customer)	50.15	51.88	-3.3 %

3.2 Activities in Luxembourg (Orange Communications Luxembourg S.A.)

Market Review

The market for mobile telephony in Luxembourg was equally subject to strong competition. Orange Communications Luxembourg occupied the third place in terms of mobile market share. After consultations, the Luxembourg regulator, under pressure from the European Commission, published its decision early 2014 that MTRs should be decreased to a temporarily level of 0.98 €ct in a one-step move as of end January 2014. After elaboration of a pure LRIC cost model, the charges would be further adjusted in the second semester of 2014. Orange Communications Luxembourg is evaluating if it will legally attack this decision, to suspend or to cancel it. The fixed market in Luxembourg is like in Belgium a closed market with historically limited competition between the incumbent and the local cable operators.

Financial Review

At the end of 2013, Orange Communications Luxembourg S.A. posted service revenues of 65.3 million euro, compared to 65.5 million euro a year earlier, a decrease of 0.3 %. The total turnover amounted to 75.6 million euro at the end 2013, an increase of 0.1 % compared to the 75.5 million euro recorded at the end of 2012. Excluding the

⁽⁷⁾ The number of active customers no longer includes the ´machine-to-machine´ cards.

⁽⁸⁾ Average Revenue Per User (smoothed average of the previous 12 months), excluding MVNOs and M2M cards.

0.75 million euro roaming regulator impact, the total revenues would amount to 76.4 million euro, an increase of 1.1 %.

The direct earnings came out at 34.9 million euro at the end of December 2013 versus 35.3 million euro at the end of 2012. The direct margin, as a percentage of the mobile service revenues of Orange Communications Luxembourg, decreased 0.47 basis points in 2013 resulting in a margin of 53.4 % versus 53.9 % in 2012. The EBITDA of Orange Communications Luxembourg S.A. amounted to 13.2 million euro at the end of 2013, compared to 11.5 million euro a year earlier. The EBITDA margin improved from 17.6 % in 2012 to 20.3 % in 2013. This positive result was realized despite the start-up costs linked to the launch of its new converged offering following the deal it has signed with the cable company Eltrona Telecom.

Operational Review

At the end of December 2013, Orange Communications Luxembourg S.A. had a total of 102,179 active mobile telephony customers, a decline of 3.4 % compared to the 105,805 active customers recorded a year earlier. However if compared to the weaker third quarter, the subscriber base rebounded slightly in the fourth quarter. In particular the postpaid residential customer base performed solid towards the end of the year, driven by the commercial success of the enhanced tariff plans, all now including international calls, roaming and even 4G for the higher-end. The ARPU amounted to 50.15 euro per month per active customer at the end of 2013, compared to 51.88 euro during the same period a year earlier. The ARPU decline is largely explained by lower roaming revenues following the launch of Hello Europe (allowing roaming calls and SMS, within the subscriptions) and the introduction of SIM-only offers on the Luxembourg market. The business segment, which suffered from high churn during the first six months of 2013, was able to show a stabilization in the second half of the year, thanks to the renewal of some big corporate deals such as Arcelor-Mittal and the distribution of a smartpro offer in the 18 Orange shops.

Since October 2013, Orange Communications Luxembourg offers 4G to its customers within a set tariff plans. 4G is included in Hello Europe Flat Surf and Hello Europe All Inclusive packages. Customers can also activate 4G with other packages. 4G is also available with Internet Everywhere packages which allows customers to use the Orange 4G network on their laptops or tablets. The company accelerated its 4G deployment plan, aiming a 90 % population coverage by beginning 2015.

In November 2013, Orange Communications Luxembourg started to commercially leverage the deal it has signed with the cable company Eltrona Telecom, to offer its customers convergent services combining mobile and fixed telephony, broadband Internet access via mobile and cable and a completely new television offer. The preliminary results are very encouraging as almost 30 % of the customers opting for this quad-play offering are new customers without prior mobile subscriptions with Orange Communications Luxembourg.

4. Financial instruments, financial risks management objective and policy

No change has occurred in comparison to the information contained in the 2012 annual report (p. 77).

5. Disputes

The information relating to disputes contained in the 2012 annual report and in the 2013 quarterly reports has been modified as follows:

Masts: The Court of Cassation confirmed in its judgments of 30 March 2012 the Constitutional Court´s interpretation of article 98 of the Act of 21 March 1991. The total receivable amount of taxes charged, plus default interest calculated at the legal rate, amounts to 67.1 million euro and is subject to a bad debt provision for the total amount, of which 9.7 million euro correspond to the financial year 2013.

Social tariffs: The proceedings before the Council of State against the Royal Decrees organizing the social tariffs database are ongoing. All parties submitted their explanatory memorandum. No pleading date is determined yet.

Regarding the appeal against the Law of 10 July 2012, pleadings took place in November 2013 before the Constitutional Court, which decided to submit prejudicial questions to the European Court of Justice.

Abuses of dominant position by the Belgacom Group: In the case regarding Belgacom's abuse of dominant position on the mobile corporate market during 2004-2005, the Court of Cassation clarified the scope of the judicial review of the Court of Appeal on 20 December 2013. Parties must organize further the appeal.

As to the abuse of dominance by Belgacom in 1999-2004, the appeal of the dismissed experts is ongoing. The pleadings are planned for May 2014. Cassation appeals against the replacement decisions have been rejected. In parallel, the Commercial Court decided in November 2013 on the opportunity to appoint new experts given the pending appeals and set up a calendar to finalize the appointment of new experts in 2014. In the meantime the appeal against the Commercial Court's decision of May 2007 should be closed by end of 2014.

Belgacom's refusal to negotiate a commercial agreement: Mobistar submitted its briefs to the Commercial Court in October 2013. Pleadings are foreseen in September 2014.

Renewal of the 2G license and license renewal fee: On 17 October 2013, the Constitutional Court rejected all appeals. The Court followed the European Court of Justice decision and finds no retroactivity.

Cable opening: The appeal proceedings on the merits have been launched and pursued in 2013. Pleadings will take place in 2014 and a decision is expected end of 2014.

6. Significant events after the end of the year

On January 16, 2014 the Government of the Grand Duchy of Luxembourg published the regulatory framework for the governance of mobile termination rates in Luxembourg. Operators are subject to a price control as described by Article 33 of the Act of 2011 based on a long-term incremental costs model (a pure bottom-up LRIC). Until the finalization of this pure LRIC cost model, the Luxembourg regulator has fixed the mobile termination rates at € 0.98 cents per minute coming from an average of € 10.50 cents per minute following an international comparison, applied nearly immediately after publication. The outcome of this regulatory LRIC model is expected in the second half of 2014.

On January 17, 2014 Mobistar announced it has made the necessary payments to the cable operators for the activation of the cable regulation. The technical implementation period for the cable operators of 6 months has now started. The payments of 600,000 euro to Telenet, on the one hand, and 600,000 euro to Brutélé-Tecteo, on the other, are Mobistar´s initial contribution to the costs associated with the opening up of the cable networks.

The Decree of December 11, 2013 containing the budgetary revenues of the Walloon Region for the fiscal year 2014 provides for the establishment of a new regional tax on masts, pylons or antennas intended to operate, directly with the public, mobile telecommunications facilities by the operator of a public telecommunications network, consisting of an annual amount of € 8,000 per site. The Decree allows municipalities to raise an additional fee of maximum hundred additional centimes to the above described regional tax applying to masts, pylons or antennas principally based on their territory. Mobistar estimates that the amount of this tax may reach 24 million euro for the year 2014. Mobistar plans to file a request for annulment of the Decree before the Constitutional Court and to file fiscal objections before the competent courts, as Mobistar considers this tax to be discriminatory and disproportionate.

On January 24, 2014 the Brussels Parliament has voted an Ordinance that foresees in the modification of the emission norms in Brussels. This new Ordinance revises the emission norm from a cumulative 3v/M previously to a new norm of cumulative 6v/M. In addition it foresees in the installment of an expert body that will perform a yearly evaluation. Finally the parliament also factors in the possibility to use public buildings for additional antennas. It is expected that the new norm will be applicable by the end of March 2014 once the execution arrest will be adopted by the Brussels Government. Mobistar is of the position that this new norm is a first good step forward. It will allow the start of 4G deployment in Brussels but it is not sufficient for further deployment or deployment of future new technologies.

7. Trends

Mobistar is going through a period of rapid transformation in which it is adapting to the new needs and expectations of the Belgian consumer, and it is casting the fundaments for its future growth.

Compared to last year, 2014 presents itself with more visibility on the short- to mid-term, in particular the gradual roll-out of Mobistar's high speed quality 4G network and the advent of its re-entry in the TV and fixed broadband market via the wholesale cable regulation is highly encouraging. This does not imply that 2014 will not be a challenging year. In 2014 Mobistar will mainly focus on further reducing its cost structure and managing its mobile value by focusing on two main axes:

• Network and Mobile Data: all Mobistar's customers should be able to 'Discover high-speed mobile data'. In order to achieve this Mobistar will deploy an industry-reference mobile network. This will position Mobistar's 3G/4G network as a valid alternative for Wi-Fi and fixed broadband internet.
• Customer Experience: given the explosion of mobile data usage, Mobistar wants to be more than just a network provider, it wants to be a partner, a friend, a teacher… helping its customers in discovering this new utility. In terms of product offering Mobistar will stay loyal to its segmented, transparent and easy-to-understand tariffs. Its commitment to provide its customers pro-active tariff advice through the well-known Personal Check-up applications remains valid. Mobistar will also increase itself through innovative mobility solutions, such as Mobile Cloud, operator billing, etc.

For the full financial year 2014 the Mobistar group aims to attain a restated EBITDA of between 250 and 280 million euro. This guidance range includes a provision of up to 24 million euro linked to a new tax law on pylons in Wallonia that was voted at the end of 2013. Mobistar plans to file a request for annulment of this law before the Constitutional Court and to file fiscal objections before the competent courts, as Mobistar considers this tax to be discriminatory and disproportionate. However, the prudence concept requires us to account for it. The guidance range also includes the impact of the existing regulatory framework governing mobile interconnection and roaming rates, which will have a revenue and EBITDA impact of respectively 23 and 16 million euro for Mobistar in Belgium and 13 and 7 million euro for Orange in Luxembourg. The regulatory framework on MTR's in Luxembourg was only voted in January 2014. The provided guidance range is based on the current market and regulatory context and does not include any impact related to the cable opportunity.

The Mobistar group reconfirms the implementation of the efficiency programme ACE2. This programme aims at the review of all company processes in order to realize a structural net operating costs saving of 50 million euros this year(9).

The strategic investments in its future and decisive action to transform the company have required an important financial outlay. The Board of Directors will therefore, as already announced in July 2013, propose to the Annual General Meeting to suspend the dividend for the financial year 2013.

8. Statutory auditor´s procedures

The statutory auditor has confirmed that the audit activities on the consolidated financial statements have been substantially completed and that no significant corrections have been identified that would have to be made to the financial information contained in the press release.

9. Financial calendar

31 March 2014	Annual report 2013 available on the website
24 April 2014	Financial results Q1 2014 (7:00 am) – Press release
24 April 2014	Financial results Q1 2014 (10:00 am) - Conference call
7 May 2014	General Meeting of Shareholders (11:00 am)
24 July 2014	Financial results H1 2014 (7:00 am) – Press release
24 July 2014	Financial results H1 2014 (10:00 am) – Conference call
20 October 2014	Financial results Q3 2014 (7:00 am) – Press release
20 October 2014	Financial results Q3 2014 (10:00 am) - Conference call

10. Shares

Share trading volumes and closing prices are based on trades made on NYSE Euronext Brussels.

Trading of shares	2013	2012
Average closing share price (€)	15.62	27.66
Average daily volume	166 955	172 463
Average daily value (€)	2 573 997	4 805 212
Shares and market values
Total number of shares	60 014 414	60 014 414
Treasury shares	0	0
Outstanding shares	60 014 414	60 014 414
Closing price (€)	13.80	19.39
Market capitalisation (million €)	839 001 508	1 163 679 487

⁽⁹⁾ Excluding the tax pylon impact of up to 24 million euro.

11. Declaration by the persons responsible

We, the undersigned, Jean-Marc Harion, CEO, and Ludovic Pech, CFO, declare that to our knowledge:

a) the financial statements drawn up in accordance with the prevailing accounting standards, give a faithful image of the assets, financial situation and results of the issuer and the companies included within its consolidation;

b) the management report contains an accurate overview of the business activities evolution, the results and the financial situation of the issuer and the companies included within its consolidation, and a description of the main risks and uncertainties they are confronted to.

Jean-Marc Harion Ludovic Pech CEO CFO

P.23

12.Tables condensed consolidated financial statements in accordance with IFRS

12.1 Condensed consolidated statement of comprehensive income (Mio €)

	31.12.2013	31.12.2012	Variation (%)
Revenue
Service revenue	1 252.9	1 450.0	-13.6%
Handsets sales	208.4	200.5	3.9%
Total turnover	1 461.3	1 650.5	-11.5%
Other operating revenue	32.9	52.0	-36.7%
Total revenue	1 494.1	1 702.5	-12.2%
Operating expenses
Interconnection costs	-337.6	-390.5	-13.5%
Costs of equipment and goods sold	-364.3	-352.9	3.2%
Services and other goods	-290.8	-281.8	3.2%
Employee benefits expenses	-157.2	-156.1	0.7%
Depreciation, amortisation and impairment	-188.3	-217.2	-13.3%
Amounts written down stocks, contracts in progress and trade debtors	-9.6	-20.4	-52.9%
Provisions for risks and charges	-3.1	2.6	-219.2%
Other operating charges	-14.6	-9.2	58.7%
Total operating expenses	-1 365.3	-1 425.6	-4.2%
EBITDA (result of operating activities before depreciation and amortisation)	317.1	494.1	-35.8%
EBITDA margin in % of service revenue	25.3%	34.1%
Share of profits (losses) of associates	-0.1
Result of operating activities (EBIT)	128.7	276.9	-53.5%
Finance income	0.4	0.5	-20.0%
Finance costs	-8.3	-11.2	-25.9%
Result of operating activities after net finance costs	120.8	266.2	-54.6%
Tax expense	-33.4	-80.5	-58.5%
Net profit of the period (*)	87.4	185.7	-52.9%
Profit attributable to equity holders of the parent	87.4	185.7	-52.9%
Consolidated statement of comprehensive income
Net profit for the period	87.4	185.7	-52.9%
Other comprehensive income	0	0
Total comprehensive income for the period	87.4	185.7	-52.9%
Part of the total comprehensive income attributable to equity holders of the parent	87.4	185.7	-52.9%
Basic earnings per share (in €)	1.46	3.09	-52.9%
Weighted average number of ordinary shares	60 014 414	60 014 414
Diluted earnings per share (in €)	1.46	3.09	-52.9%
Diluted weighted average number of ordinary shares	60 014 414	60 014 414

(*) Since there are no discontinued operations, the profit of the period corresponds to the result of continued operations.

12.2 Condensed consolidated statement of financial position (Mio €)

	31.12.2013	31.12.2012
ASSETS
Non-current assets
Goodwill	80.1	80.1
Intangible assets	380.2	286.5
Property, plant and equipment	700.0	665.0
Interests in associates	3.3	3.4
Other non-current assets	0.8	4.0
Deferred taxes	6.7	6.7
Total non-current assets	1 171.1	1 045.8
Current assets
Inventories	20.7	20.6
Trade receivables	215.1	230.2
Other current assets	29.2	38.2
Cash and cash equivalents	13.8	12.3
Total current assets	278.8	301.2
Total assets	1 449.9	1 347.0
EQUITY and LIABILITIES
Equity
Share capital	131.7	131.7
Legal reserve	13.2	13.2
Retained earnings	192.3	212.9
Total equity	337.2	357.8
Non-current liabilities
Interests-bearing borrowings	548.8	383.7
Trade payables	0.0	13.4
Provisions	69.6	67.4
Deferred taxes	1.3	0.0
Total non-current liabilities	619.7	464.5
Current liabilities
Interests-bearing borrowings	21.9	22.6
Trade payables	352.1	344.6
Employee benefits related liabilities	31.5	34.4
Current taxes payables	15.6	42.7
Deferred income	66.2	77.5
Other payables	5.8	3.0
Total current liabilities	493.0	524.7
Total liabilities	1 112.7	989.2
Total equity and liabilities	1 449.9	1 347.0

12.3 Condensed consolidated statement of changes in equity (Mio €)

	Share capital	Legal reserve	Retained earnings	Total equity
Balance as at 1 January 2013	131.7	13.2	212.9	357.8
Net profit for the period			87.4	87.4
Total comprehensive income for the period			87.4	87.4
Declared dividends			-108.0	-108.0
Equity transaction costs			0.0	0.0
Balance as at 31 December 2013	131.7	13.2	192.3	337.2

	Share capital	Legal reserve	Retained earnings	Total equity
Balance as at 1 January 2012	131.7	13.2	249.1	394.0
Net profit for the period			185.7	185.7
Total comprehensive income for the period			185.7	185.7
Declared dividends			-222.1	-222.1
Equity transaction costs			0.2	0.2
Balance as at 31 December 2012	131.7	13.2	212.9	357.8

12.4 Condensed consolidated cash flow statement (Mio €)

	31.12.2013	31.12.2012
Cash flows from operating activities
Profit before taxes	120.8	266.2
Non-cash adjustments for:
Depreciation, amortisation and impairment of fixed assets	188.3	217.2
Changes in long-term provisions	0.2	0.6
Changes in provision for bad debt	-3.9	13.3
Other non-cash expenses	1.5	1.0
Interest income	-0.4	-0.2
Interest charges	6.0	7.3
Adjusted result of operating activities before net finance costs	312.5	505.4
Inventories	-0.1	-4.1
Trade and other receivables	25.2	5.0
Trade and other payables	-4.6	-33.7
Net changes in working capital	20.5	-32.8
Tax paid	-56.5	-154.9
Interests paid	-5.1	-6.7
Interests received	0.4	0.5
Net cash from operating activities	271.8	311.5
Cash flows from investing activities
Purchase of intangible and tangible assets	-319.0	-188.5
Debt associated to purchase of assets (increase +, decrease -)	-14.2	8.0
Acquisition of subsidiary		-3.4
Proceeds from sale of equipment	2.2	2.2
Reimbursement long-term loans granted	1.4	2.0
Net cash used in investing activities	-329.6	-179.7
Organic cash flow (1)	-59.1	133.2
Cash flows from financing activities
Short-term borrowings - net	-0.7	4.1
Long-term borrowings - proceeds	196.9	135.5
Long-term borrowings - repayments	-31.7	-45.0
Transactions costs paid for long-term credit facility		0.2
Others	2.8	0.9
Equity transactions costs		0.1
Dividends paid	-108.0	-222.5
Net cash used in financing activities	59.3	-126.6
Net increase (+), decrease (-) in cash and cash equivalents	1.5	5.2
Cash and cash equivalents at beginning of period	12.3	7.1
Cash and cash equivalents at end of period	13.8	12.3

12.5 Segment information (Mio €)

2013	31.12.2013 Belgium		31.12.2013 Luxembourg	Interco elimination	Mobistar Group
	Mobile	Non-Mobile	Total	Total	Total	Total
Operating revenues
Network & other operating revenues (service revenues)	1 067.2	144.7	1 211.9	65.3	-24.3	1 252.9
Handsets sales	210.2	0.0	210.2	10.3	-12.1	208.4
Total turnover	1 277.3	144.7	1 422.1	75.6	-36.3	1 461.3
Other	0.0	0.0	0.0	0.0	0.0	0.0
Total operating revenues	1 277.3	144.7	1 422.1	75.6	-36.3	1 461.3
Operating charges
Direct costs excl. direct commercial costs	-489.1	-57.5	-546.7	-39.6	20.3	-566.0
Direct commercial costs	-128.3	-2.2	-130.5	-1.0	0.0	-131.5
Direct costs	-617.4	-59.8	-677.1	-40.7	20.3	-697.5
Direct earnings	659.9	85.0	744.9	34.9	-16.0	763.8
% Operating revenues	61.8%	58.7%	61.5%	53.5%	66.0%	61.0%
Indirect production costs	-147.1	-41.7	-188.8	-8.4	16.0	-181.2
Information technology	-33.1	-3.0	-36.1	-0.6	0.0	-36.7
Communication, Marketing &
Product development	-35.6	-7.2	-42.9	-2.6	0.0	-45.5
Indirect customer facing costs	-96.1	-14.9	-111.0	-6.6	0.0	-117.6
General and administration costs	-58.6	-3.8	-62.4	-3.4	0.0	-65.8
Indirect costs	-370.5	-70.6	-441.1	-21.6	16.0	-446.7
EBITDA	289.4	14.4	303.8	13.3	0.0	317.1
% EBITDA on operating revenues			25.1%	20.3%	0.0%	25.3%
Depreciations	-167.2	-14.3	-181.5	-6.8		-188.3
Share of profits (losses) of associates		-0.1	-0.1			-0.1
EBIT	122.3	-0.1	122.2	6.5	0.0	128.7
Financial income			0.5	0.0	0.0	0.5
Financial costs			-8.2	-0.2	0.0	-8.4
Profit before taxes			114.5	6.3	0.0	120.8
Tax expense			-32.6	-0.8	0.0	-33.4
Net profit of the period (*)			81.9	5.5	0.0	87.4
Profit attributable to equity holders of the parent			81.9	5.5	0.0	87.4

(*) Since there are no discontinued operations, the profit of the period corresponds to the result of continued operations.

2012		31.12.2012 Belgium		31.12.2012 Luxembourg	Interco elimination	Mobistar Group
	Mobile	Non-Mobile	Total	Total	Total	Total
Operating revenues
Network & other operating revenues (service revenues)	1 240.0	160.3	1 400.3	65.5	-15.8	1 450.0
Handsets sales	205.0	0.0	205.0	10.0	-14.5	200.5
Total turnover	1 445.0	160.3	1 605.3	75.5	-30.3	1 650.5
Other	0.0	0.0	0.0	0.0	0.0	0.0
Total operating revenues	1 445.0	160.3	1 605.3	75.5	-30.3	1 650.5
Operating charges
Direct costs excl. direct commercial costs	-534.0	-84.2	-618.2	-39.0	23.7	-633.5
Direct commercial costs	-120.5	-3.1	-123.6	-1.2	0.0	-124.8
Direct costs	-654.5	-87.3	-741.8	-40.2	23.7	-758.3
Direct earnings	790.5	73.0	863.5	35.3	-6.6	892.2
% Operating revenues	63.8%	45.5%	61.7%	53.9%	41.7%	61.5%
Indirect production costs	-109.0	-37.3	-146.3	-8.8	6.6	-148.5
Information technology	-41.7	-3.7	-45.4	-0.6	0.0	-46.0
Communication, Marketing & Product development	-29.0	-13.0	-42.0	-3.2	0.0	-45.2
Indirect customer facing costs	-87.7	-24.3	-112.0	-7.9	0.0	-119.9
General and administration costs	-30.8	-4.4	-35.2	-3.3	0.0	-38.5
Indirect costs	-298.2	-82.7	-380.9	-23.8	6.6	-398.1
EBITDA	492.3	-9.7	482.6	11.5	0.0	494.1
% EBITDA on operating revenues			34.5%	17.6%	-0.3%	34.1%
Depreciations	-193.8	-15.5	-209.3	-7.9		-217.2
EBIT	298.5	-25.2	273.3	3.6	0.0	276.9
Financial income			0.5	0.0	0.0	0.5
Financial costs			-10.9	-0.3	0.0	-11.3
Profit before taxes			262.9	3.3	0.0	266.2
Tax expense			-80.4	-0.1	0.0	-80.5
Net profit of the period (*)			182.5	3.2	0.0	185.7
Profit attributable to equity holders of the parent			182.5	3.2	0.0	185.7

12.6 Quarterly results

		Quarterly figures 2012				FY 2012
		Q1	Q2	Q3	Q4
Subscriber base evolution
Mobistar S.A. Mobile customers (excl. MVNO, MATMA)	in thousand	3 517.1	3 524.9	3 512.6	3 432.1
of which Postpaid	in thousand	2 349.9	2 375.3	2 388.6	2 338.5
of which Prepaid	in thousand	1 167.2	1 149.6	1 124.0	1 093.6
Mobistar S.A. MATMA	in thousand	433.3	454.5	476.6	518.1
MVNO customers	in thousand	572.4	619.4	700.6	889.5
Orange Communications Luxembourg S.A. customers	in thousand	96.7	100.2	102.9	105.8
Total Mobistar Group	in thousand	4 619.5	4 699.0	4 792.7	4 945.5
ARPU evolution
Blended ARPU (rolling average of the preceding
12 months incl. visitor roaming)	in EUR/month	29.32	28.85	28.82	28.74
Postpaid ARPU (excl. visitor roaming and IEW)	in EUR/month	34.95	34.41	33.95	33.42
Prepaid ARPU
(excl. visitor roaming and IEW)	in EUR/month	17.08	16.72	17.12	17.53
P&L
Service Revenues Mobistar Mobile	in Mio EUR	304.3	311.6	308.0	316.1	1 240.0
Service Revenues Mobistar/MES Fix/Data	in Mio EUR	41.5	38.8	38.5	41.5	160.3
Service Revenues Orange Communications Luxembourg S.A.	in Mio EUR	15.7	16.6	16.4	16.8	65.5
Total Mobistar consolidated service revenues(1)	in Mio EUR	358.4	363.3	359.0	369.3	1 450.0
Total Mobistar consolidated handsets sales	in Mio EUR	41.1	39.7	38.6	81.1	200.5
Total Mobistar consolidated turnover	in Mio EUR	399.5	403.0	397.6	450.4	1 650.5
Mobistar consolidated restated EBITDA	in Mio EUR	113.2	137.5	121.0	127.3	499.0
Mobistar consolidated EBITDA	in Mio EUR	113.1	136.6	119.7	124.7	494.1
	as a % of service revenues	31.5%	37.6%	33.3%	33.8%	34.1%
Total Mobistar consolidated net result	in Mio EUR	38.2	54.7	44.7	48.1	185.7
EPS calculated on the basis of the outstanding shares at the end of the
quarter	in EUR/share	0.64	0.91	0.74	0.80	3.09
Diluted weighted average earnings per share	in EUR/share	0.64	0.91	0.74	0.80	3.09
Total Mobistar consolidated CAPEX	in Mio EUR	24.8	37.8	38.4	87.5	188.5
	as a % of service revenues	6.9%	10%	11%	24%	13%
Organic cash flow	in Mio EUR	28.9	52.6	66.3	-14.6	133.2

		Quarterly figures 2013				FY 2013
		Q1	Q2	Q3	Q4
Subscriber base evolution
Mobistar S.A. Mobile customers (excl. MVNO. MATMA)	in thousand	3 375.9	3 330.8	3 244.3	3 170.1
of which Postpaid	in thousand	2 312.6	2 301.3	2 256.5	2 221.8
of which Prepaid	in thousand	1 063.3	1 029.5	987.8	948.3
Mobistar S.A. MATMA	in thousand	550.5	585.7	641.7	695.7
MVNO customers	in thousand	973.9	1 073.2	1 142.1	1 209.7
Orange Communications Luxembourg S.A. customers	in thousand	105.4	105.4	101.5	102.2
Total Mobistar Group	in thousand	5 005.7	5 095.1	5 129.6	5 177.7
ARPU evolution
Blended ARPU (rolling average of the preceding
12 months incl. visitor roaming) Postpaid ARPU	in EUR/month	28.19	27.35	26.47	25.13
(excl. visitor roaming and IEW)	in EUR/month	32.63	31.60	30.55	29.14
Prepaid ARPU
(excl. visitor roaming and IEW)	in EUR/month	17.28	16.78	16.11	14.99
P&L
Service Revenues Mobistar Mobile	in Mio EUR	281.1	274.5	262.9	248.7	1 067.2
Service Revenues Mobistar/MES Fix/Data Service Revenues Orange Communications	in Mio EUR	39.3	36.6	35.8	33.0	144.7
Luxembourg S.A.	in Mio EUR	16.5	17.4	15.6	15.8	65.3
Total Mobistar consolidated service revenues(1)	in Mio EUR	332.0	322.9	307.8	290.2	1 252.9
Total Mobistar consolidated handsets sales	in Mio EUR	61.0	41.0	39.7	66.7	208.4
Total Mobistar consolidated turnover	in Mio EUR	393.0	363.9	347.5	356.9	1 461.3
Mobistar consolidated restated EBITDA	in Mio EUR	99.0	85.5	90.8	60.3	335.7
Mobistar consolidated EBITDA	in Mio EUR	98.7	82.2	89.1	47.1	317.1
	as a % of service revenues	29.7%	25.4%	29.0%	16.2%	25.3%
Total Mobistar consolidated net result	in Mio EUR	35.1	22.3	26.2	3.8	87.4
EPS calculated on the basis of the outstanding shares at the end of the
quarter Diluted weighted average earnings	in EUR/share	0.59	0.37	0.43	0.07	1.46
per share	in EUR/share	0.59	0.37	0.43	0.07	1.46
Total Mobistar consolidated CAPEX	in Mio EUR	31.2	37.7	46.8	203.3	319.0
	as a % of service revenues	9.4%	12%	15%	70%	25%
Organic cash flow	in Mio EUR	0.2	27.4	66.8	-153.5	-59.1

Mobistar (EURONEXT BRUSSELS: MOBB) is one of the main actors on the telecommunications market in Belgium and Luxembourg. The company offers its residential customers postpaid and prepaid innovative mobile telecom products and services. On the business market, Mobistar operates DSL fixed network telephony and highspeed internet, acts as an integrated communications provider and offers a portfolio of mobility and connectivity services. Mobistar is also a wholesale provider, offering access to its infrastructure and service capabilities to its wholesale partners. Mobistar, with the Orange group as major shareholder, is listed on the Brussels Stock Exchange.

For further information, please contact:

Investor relations: e-mail: ir@mail.mobistar.be - http://corporate.mobistar.be Siddy Jobe: +32 (0)2 745 80 92 Press service: e-mail: press@mail.mobistar.be - http://corporate.mobistar.be/press Patti Verdoodt: +32 (0)495 55 96 26 Follow us on Twitter: @PressMobistar