annual report of activities Sonatel 2014
annual report
foreword
This report is a reflection of our vision, full of optimism and looking to the future. The African hairstyle is a living art, constantly evolving. As the continent itself, it is incredibly rich, creative and varied. It feeds, influences and reinvents itself every day to build a perfect bridge
between
tradition
and
moder nity.
Today, African hairstyle has managed to cross borders to meet inter national recognition. No wonder, that the photographs in this report are derived from a cosmopolitan collaboration.
Summary letter from the Chairman
p 06
message from the Managing Director
p 08
1. good governance, pledge for transparency
p 11
2. h uman Resources: transformation of human capital to meet Sonatel strategic challenges 2.1 competency Development: more professional teams 2.2 health: Welfare at Work :pledge of productivity
3. Sonatel Citizen involvment 3.1 Sonatel, operator engaged in the economic and social development in the countries of its presence 3.2 philanthropy: 13 years of Sonatel Foundation’s commitment for the welfare of Senegalese population 3.2.1 health: actions in six priority areas 3.2.2 education: access and excellence for all 3.2.3 promotion of culture in Senegal
4. our activities
p 23 p 23 p 24
p 29 p 29 p 31 p 31 p 32 p 33
p 35
the Senegalese market 4.1 mobile: Orange has captured over 76% of growth market in 2014 4.2 fixed-lines and Internet: development of usages 4.3 corporate service 4.3.1 better focus on SMIs/ SMEs with the multiplying of the number of Pro spaces 4.3.2 launch of B2B structuring offers 4.4 pursuit of customer service transformation project, a key factor of differentiation and customer loyalty
p 39
our subsidiaries abroad 4.5 Orange Mali : Growth despite difficult economic and security conditions 4.6 Orange Guinea : continued leadership and coverage of all sub-prefectures 4.7 Orange Bissau consolidates its leadership through innovation 4.7.1 significant investments to improve the service quality of the mobile voice network 4.7.2 foundation for a strong CSR policy
p 40 p 42 p 42 p 43 p 43
5. networks and information systems: Orange, leader on technical service quality 5.1 mobile network modernization 5.2 increase of 3G speeds 5.3 4G test successfully managed in Senegal by Sonatel 5.4 Evolution of IP core network, Voice, Mobile, national and international transmission and service platforms
6. Sonatel in the world 7. finance 7.1 key figures 7.2 Sonatel traded share 7.3 financial report
p 35 p 37 p 38 p 38 p 38
p 45 p 45 p 45 p 45 p 46
p 49 p 53 p 54 p 61 p 63
8. annexes - financial statements - general and special reports such as Auditors’ Reports
p 84 p 117
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Sonatel 2014 annual report of activities
I
n 2014, Sonatel Group has once again confirmed its leadership and good operating results in all countries of its presence.
The international subsidiaries, Orange Mali, Orange Guinea and Orange Bissau this year contribute for 56 percent to the consolidated net income and 48% to Group sales. Senegal, with a weight of 44 percent remains the main contributor to the group’s net result in 2014 amounted to 218 billion XOF representing growth of 15.1 percent. This year, the Group’s Turnover has maintained in a double-digit growth (10.5 percent) and reached 816 billion XOF.
Marc Rennard
Chairman of the Board
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It should be noted however a stagnation of activity in Senegal where the market matures. The intensification of competition, the regulatory and tax burden increasingly strong in the telecommunications sector also explain this situation.
annual report of activities Sonatel 2014
Chairman’s letter Despite this, the Sonatel group continues to remain a key player in the creation of wealth in all countries of presence and particularly in Senegal. Sonatel share price greeted this performance, reaching a record level of 24,600 XOF in continuous trading since 2013. Moreover, Sonatel will continue its investment efforts to increase the coverage of population and accelerate the transition of network equipment to the latest technology. The successful testing of 4G in Senegal is a demonstration, pending his next commercial launch. Along with the Managing Directorate, Sonatel Board of Directors extends its congratulations for these good results to all employees of Sonatel Group in the four countries, their commitment and mobilization have allowed these beautiful performances and all encouragement for the future. Sonatel will have the support of the Board to remain a key player in the development of the digital economy in West Africa.
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Sonatel 2014 annual report of activities
A
long with the good results recorded in the previous year, Sonatel Group was able in 2014 to confirm his leadership and its strong operational and financial performance in all countries of its presence through its capacity for innovation, its operational excellence, good sales momentum and the maintaining of a sustained level of investment. The group’s turnover amounted to 816 billion XOF, up by 10.5 percent over 2013. The net profit amounted of 218 billion XOF representing an increase of 15 percent.
Alioune Ndiaye Managing Director
Compared to the year 2013, the growth in sales turnover (+ 78 billion XOF) is exclusively driven by overseas subsidiaries. However, Senegal still retains in a dominant position with a contribution of 52 percent on turnover against 48 percent of turnover for the other subsidiaries. In addition, Sonatel international subsidiaries account for over two thirds of the group’s clients whose number reaches 26 million in late 2014.
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annual report of activities Sonatel 2014
Message from the Managing Director The Ebitda margin remained stable (52 percent) despite new unfavorable tax and regulatory measures, illustrating our efforts to control costs. The growth drivers such as mobile internet or Orange money have experienced strong dynamic: Orange Money turnover grew by 5 billion XOF in Mali and has multiplied by 3.5 in Senegal. In 2014, Sonatel Group remains the main contributor to budget revenues of countries with presence with 374 billion XOF in various contributions. The regulatory and competitive environment is getting tougher but the Sonatel Group will strengthen its investments in all countries of presence and deploy new innovative services so as to support its expansion and maintain its leadership in the telecommunications sector to face the competition.
of a customer service meeting the highest international standards. The transformation projects will therefore continue in the context of a permanent and constructive dialogue with all our stakeholders to adapt the company to the challenges it will face tomorrow. For 2015, the Sonatel group already knows it can count on the commitment of its employees and the support of its key stakeholders such as the Government of Senegal and the Orange group. Sonatel intends to be the preferred partner of the Government of Senegal for the emergence of the digital economy in the Senegal Emergent Plan (SEP) and the challenge of digital inclusion in all countries of presence.
The dynamics of conquest will be supported by the group including strengthening the quality of technical service, extension and modernization of the network and by the establishment
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Sonatel 2014 rapport annual report annuelof activities
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annual report of activities Sonatel 2014
GOOD GOVERNANCE PLEDGE FOR TRANSPARENCY
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Few words on governance
Since May 5, 2014, the date of entry into force of the new OHADA Uniform Act (Organisation for the Harmonization of Business Law in Africa) relating to Commercial Companies and Economic Interest Group (EIG), all corporations have a legal obligation to bring to the attention of their shareholders a certain amount of information including on the governance of their company. These are the items 547-1, 831-2 and 831-3 of the above mentioned Uniform Act that determine the new rules. Sonatel did not wait for the new arrangements to share with its shareholders its governance rules for since 2009, its governance is comprehensively presented in its annual report for its shareholders. Here is the new version taking into account these new aforementioned legal provisions.
1.1 Shareholders’ participation modalities at the General Meeting he right to attend General Meetings is subject to registration of the shareholder’s name on the share register, five days before the meeting.
T
Regardless of the number of shares held, shareholders may participate in or be represented at the Extraordinary General Meetings.
The accounting entry of the shares on behalf of the shareholder or the interim on his behalf, on the third business day preceding the Meeting at midnight, local time, in the share bearer records kept by the Stock Exchange Securities (BRVM) also justifies the right to participate in General Meetings.
Any shareholder may be represented by their spouse or by an agent of his choice, shareholder or not a shareholder himself.
Any shareholder (or group of shareholders) representing at least one hundred (100) shares may attend or be represented at Annual General Meetings.
The representative of a shareholder has the voting rights of its mandate under the same conditions and the same limit.
Every shareholder has as many voting rights as shares he owns and represents.
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Sonatel 2014 annual report of activities
1.2 Update on the status of the employee participation in the capital as of 31 December 2014
S
onatel gives a special importance to the shareholder of its staff and it is for this purpose that since its IPO in 1998, all staff is a shareholder.
This staff shareholders in the Sonatel Group’s companies is now cited as an example, each employee feeling to a higher level concerned with the future of his business.
On 31 December 2014, the Sonatel Group has 2,700 employees, including 1,751 in Senegal. On 31 December 2014, 1,737 Sonatel employees are shareholders representing a stake in the share capital of up to 8.1 percent.
This example is replicated elsewhere today in many companies.
1.3 Composition of the Board of Directors
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n 31 December 2014, the Board of Sonatel has 10 members (9 Directors and one representative of the Financial Controller)
• Mr. Marc Rennard, Chairman of the Board of Directors, • Mr. Mamadou Sarr, Director, • Mr. El Hadji Abdoul Aziz Mbaye, Director, • Mr. Cheikh Tidiane Mbaye, Director,
• Mr. Thierry Breton, Director, • Mr. Fabrice Andre, Director, • Mr. Mamadou Diop Aïdara, Director, • Mr. Hugues Foulon, Director, • Colonel Birane Diouf, Director, •M r. Abdoulaye Kamara, representing the Financial Controller.
1.4 Mandates and functions held by each Director
A
s of 31 December 2014, the mandates and functions are exercised by nine directors of Sonatel:
Mr. Marc Rennard •A ctual mandates and functions within Chairman of the Board, • Other mandates held in Senegal: none
Sonatel:
Mr. Mamadou Aidara Diop • Mandates and functions within Sonatel: Director •O ther offices held in Senegal: Director at the Social Security Fund Mr. Hugues Foulon •M andates and functions within Sonatel: Director, Member of Audit Committee • Other offices held in Senegal: none
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Mr. Cheikh Tidiane Mbaye • Mandates and functions within Sonatel: Director • Other offices held in Senegal: Director in Grande Côte Operation Senegal, Societe Generale de Banques au Senegal, Total Senegal and Senegal Chain Hotel (Radisson) Mr. El Hadji Abdoul Aziz Mbaye • Mandates and functions within Sonatel: Director • Other offices held in Senegal: Chairman of the Supervisory Board of the Agency of Government Information Technology (ADIE) Mr Mamadou Sarr • Mandates and functions within Sonatel: Director, Member of Audit Committee • Other offices held in Senegal: Director within APIX, ENA and BICIS,
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GOOD GOVERNANCE PLEDGE FOR TRANSPARENCY
Mr Fabrice Andre • Mandates and functions within Sonatel: Director • Other offices held in Senegal: none
annual report of activities Sonatel 2014
Mr. Birane Diouf • Mandates and functions within Sonatel: Director • Other offices held in Senegal: none
Mr Thierry Breton • Mandates and functions within Sonatel: Director • Other offices held in Senegal: none
1.5 Conditions of preparation and organization of the Board’s work
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he rules governing the preparation and organization of the Board’s work are set by the Statutes and the Rules of Procedure of Sonatel.
The President established at the beginning of each year the biannual schedule of meetings. The calendar of the second semester is established before the end of the first semester. The notices of Board meetings specifying the agenda are sent by registered mail, e-mail the President, fifteen (15) days before the date of the meeting or three (3) days before the meeting date in case of emergency. The urgency of the decision or decisions are left to the discretion of the Chairman of the Board of Directors.
The Chairman of the Board of Directors may invite members of the Sonatel management team, after consultation with the Managing Director, according to the issues on the agenda. In any event, the Board of Directors may, in each of its meetings, in an emergency and Chairman’s proposal, deliberate on any matter not included on the agenda presented to it. The Board’s deliberations are recorded in minutes drawn up by the Chairman of the meeting and the Secretary and signed by the Chairman of the meeting and at least one Director.
The documents relating to the items on the agenda are sent to the Directors at least: • ten (10) days prior to any meeting when it comes to documents submitted for decision making, • five (5) days (including a weekend) before any meeting when it comes to documents provided for information purposes.
1.6 Applying governance codes of the ISA and the SCCP
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onatel is referring since 2011 to Business Governance Code developed by the Senegalese Institute of Directors (ISA).
The purpose of this code is to promote good governance practices in companies both in public and private sectors. The provisions of the Code, inspired by the OHADA law are a set of rules of good conduct for companies. The Board of Sonatel has chosen to follow the rules defined by this Code because these texts highlight the code of good governance practices to know.
We can mention among rules enacted: • the relationship between Sonatel and its shareholders resulting fair treatment of shareholders and the transparency and quality of information transmitted, • r ules relating to the roles, missions, composition, functioning and the Board committees, • the relationship between the Council, the General Management and Executives, • the Council and the auditors, • the Council and other stakeholders.
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Sonatel 2014 annual report of activities
Sonatel, since 2012, also refers to the Code of Conduct for Private Sector Enterprises in Senegal developed by the Private Sector Coalition against Corruption (SCCP) which was set up by the Government of Senegal and the World Bank which see corruption as a limiting factor for economic and social development of Senegal. Sonatel has adhered to the Code of Conduct which: • establishes guidelines and rules of conduct for the fight against corruption • promotes ethics and good corporate governance in private sector companies, and in the relations between the private sector companies and between firms, administrations, customers and consumers.
This Code is based on three guiding principles: • ethics in its definition and the implementation of policies and development strategies in line with ethical principles, • social responsibility with a commitment beyond the purpose of profit, to build a responsible corporate citizen concerned about his social environment. • corporate governance by applying the basic principles of the Senegalese Institute of Directors (ISA) in particular the integrity of leaders, and respected the clear definition of roles between the Assembly of shareholders, the Board of Directors and General Management and finally the rights of shareholders and equality in their treatment. These codes are available from these institutions.
1.7 Principles and rules for determining compensation and benefits granted to corporate officers
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he remuneration and benefits of Directors are determined in accordance with the provisions of AUSCGIE: it is an initial decision of the Board.
The allowances of the Directors set by the Board of Directors shall however be approved by the Annual General Meeting. Upstream of this legal procedure, Sonatel has set up since April 2008, a Nomination and Remuneration Committee whose responsibilities include making such proposals to the Council on: • duty allowances for directors, • the remuneration policy for Sonatel corporate officers • r emuneration, mobility of executives and the Sonatel employee shareholding policy.
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This Committee had thus made a proposal to the Board which will make the decision. The Board of Directors No. 141 dated on 2 February 2012 had set the duty allowances which are paid to the directors present at the relevant meetings (Boards of Directors, the Audit Committee). An overall budget had been allocated by the Sonatel Ordinary General Meeting on 8 April 2009. This envelope is equal to 65 million XOF per year.
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GOOD GOVERNANCE PLEDGE FOR TRANSPARENCY
annual report of activities Sonatel 2014
1.8 Total compensation and benefits of any kind paid to each Director During 2014, the Board of Sonatel met five (5) times, the Audit Committee one (1) time. During the year 2014, the duty allowances were paid to the directors present at meetings (Board of Directors and the Audit Committee) in the following proportions:
Directors
Board of Directors
Audit Committee
Total
Mr. Abdoul Aziz Mbaye
4,000,000 XOF
4,000,000 XOF
Mr. Birane Diouf
1,600,000 XOF
1,600,000 XOF
Mr. Cheikh Tidiane Mbaye
3,200,000 XOF
3,200,000 XOF
Mr. Mamadou Diop Aidara
4,000,000 XOF
4,000,000 XOF
Mr. Mamadou Sarr
3,200,000 XOF
Mr. Bernard Ghillebaert ***
4,000,000 XOF
Mr. Hugues Foulon
3,200,000 XOF
Mr. Marc Renard
7,000,000 XOF
7,000,000 XOF
Mr. Thierry Breton
3,200,000 XOF
3,200,000 XOF
General
33,400,000 XOF
800,000 XOF
4,000,000 XOF 4,000,000 XOF
800.000 XOF
1,600,000 XOF
4,000,000 XOF
35,000,000 XOF
The above allocation is consistent with the overall annual budget of 65 million XOF. *** Has been replaced by Mr. Fabrice Andre at the meeting of 23 December 2014. The mandate of Mr. Fabrice Andre thus took effect at the end of this meeting.
1.9 Commitments taken in favor of corporate officers No commitment has been made by Sonatel in favor of its corporate officers for the year 2014.
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Sonatel 2014 annual report of activities
1.10 Limitations of the Managing Director’s powers
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he Managing Director has the broadest powers to act in all circumstances on behalf of the company. He exercises his powers within the limits of the corporate purpose and subject to those that the law and rules of procedure of the Board of Directors will attribute to him.
The Board, however, has since 1997 established a ceiling for commitments of the Managing Director beyond which the prior approval of the Board is required. This limitation of the powers of the Managing Director was also enshrined in Article 13 bis of the Articles of Sonatel.
1.11 Internal control procedures and risk management in force Sonatel has of course introduced a process of internal control and risk management. The activities, the results of this process of internal control and risk management are monitored by the Audit Committee. For effective and efficient management of this process, structures and follow-up committees exist in Sonatel: a dedicated department for risk management and internal control having as main responsibilities: • the development and regular updating of risk mapping linked to the activities of all processes Sonatel (identification, treatment, assessment and prioritization of risks), • piloting the top risks (priority risks and unacceptable risks) defined by the General Management, • risk analysis related to strategic deals and projects, • systematic review of procedures to ensure the integration of the internal control systems covering risks, • support for businesses for the development and ownership of internal control, • the annual verification of compliance with financial security laws and the Sarbanes Oxley Act applicable to listed companies in the United States because of the membership of the Orange Sonatel Group (review of questionnaires on the internal control environment review by the Statutory Accounts for validation, documentation and annual testing of the control activities of the closing process).
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an Internal Audit Department to assess the internal control system (tests to ensure the correct application and effectiveness of the internal control system documented). Internal Audit has as main responsibilities: • lthe development and implementation of an annual audit program covering strategic directions and challenges of Sonatel in all areas including those exposed to criticism and unacceptable risks. • monitoring the implementation of recommendations of internal and external audits A Risk Committee chaired by the Managing Director and composed of all the Directors and Heads of Departments of Safety, Revenue Assurance and Risk Management and Internal Control. This Committee, which meets each semester, has for missions to: • analyze the top risks (priority risks and unacceptable risks) defined by the Directorate General to ensure their mastery, • identification and impluse necessary synergies between the various functions involved in risk management, • the preparation of internal control reviews and the monitoring of the conclusions of the review. A Committee for Risks Review related to strategic projects and offers of Sonatel with a veto on the continuation or not of the project or the offer. The results obtained to date are positive and ongoing monitoring is carried out to effectively contribute to the sustainability of the activity of Sonatel.
Sonatel 2014 annual report of activities
Mr. Marc RENNARD Chairman of the Sonatel Board of Directors
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MEMBER OF THE BOARD OF SONATEL TO 31 DECEMBER 2013
Mr. Fabrice André Sonatel Director
Mr. Thierry BRETON Sonatel Director
Mr. Mamadou Aïdara DIOP Sonatel Director
Colonel Birane Diouf Sonatel Director
annual report of activities Sonatel 2014
Mr. Hugues FOULON Sonatel Director
Mr. Abdoulaye KAMARA Representing the financial Controller
Mr. El Hadji Abdoul Aziz MBAYE Sonatel Director
Mr. Cheikh Tidiane MBAYE Sonatel Director
Mr. Mamadou SARR Sonatel Director
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Sonatel 2014 annual report of activities
> EXECUTIVE COMMITTEE GROUP
Mr.Alioune NDIAYE Managing Director Sonatel
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Mr. Seydi Ahmed Sy SARR Managing Director Orange Bissau
Mr. Alassane DIENE Managing Director Orange Guinea
Mr. Jean Luc BOHE Managing Director Orange Mali
Mr. Birago Moctar BEYE International Operations and Operators Director
Mr. Amadou DEME Director of Purchasing and Logistics
Mr. Aboubacar Sadikh DIOP Financial and Accounting Director
Mr. Abdou Karim MBENGUE Corporate Communications and External Relations Director
Mr. Gana NDOYE Human Resources Director
Mrs. Nogaye Thérèse TOUNKARA Networks and Services Platform Director
annual report of activities Sonatel 2014
Mr.Jerôme HENIQUE Deputy Managing Director
Mr. Omar Gueye NDIAYE Strategy and Development Director, Managing Director of Sonatel Multimedia
Mrs. Aminata NDIAYE Consumer Marketing Director Managing Director of Sonatel Mobile
Mr. Sekou DRAME Corporate Director Managing Director of Sonatel Business Solutions
Mrs. Afissatou Sall GAYE Audit Risk and Quality Director
Mrs. Gisèle Pouye GUEYE Customer Service Director
Mrs. Rokhaya GUEYE Regulatory and Legal Affairs Director
Mr. Mamadou Ibrahima TRAORE Executive Sales Director
Mrs. Racky Sada WANE Information Systems Director
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Sonatel 2014 rapport annual report annuelof activities
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annual report of activities Sonatel 2014
HUMAN RESOURCES
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transformation of human capital to meet Sonatel strategic challenges
Sonatel has always made its human resources its first key success factor. The company plans to continue this momentum for the development of its human capital, the base of its growth and of the satisfaction of its stakeholders. Thus, various actions have been carried out particularly in the areas of skills development of our employees, motivation and adherence of staff to achieve the strategic objectives of promoting well-being at work in favor of Group employees and their families.
2.1 Competencies development: more professional teams
S
onatel has still deployed significant resources in 2014 for the development and strengthening of its employees’ competencies.
For this purpose, 338 trainings were conducted for the employees’ benefit with 13,603 students /day besides English training program specially held for managers of the Coordination Committee. 83,623 hours of training were carried out in 2014. In total, 1,438 employees have benefited from at least one training done during this year, including 110 employees trained outside Senegal.
In terms of career management: Launching the repository of courses and the technical field of expertise. The Human Resources Information System (HRIS) Intelligent was also made available to employees to enable them to simulate their development and mobility opportunities, and analyze the impacts in terms of skills to acquire / develop to access to target jobs. HRIS Intelligent is also in the will of Sonatel to give more visibility to employees about their careers, but also to accompany them to build and realize their career plans. In terms of mobility: the launch of «MERCATO of mobility» was one of the highlights of 2014.
Professionalization certificate course was organized for the teams, to both technical, commercial, marketing and communication. This has significantly improved the service provided to customers.
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Sonatel 2014 annual report of activities
Many gains have been made among which we note: • The establishment of incentive scheme: distribution of Sonatel shares to all Group employees to achieve the Corporate Project’s objectives, • Free Internet for staff: establishment of a blocked 3GB package, • Obtaining for the 2nd consecutive year of the Top Employer label.
2.2 Health: Welfare to Work pledge of productivity The corporate health service has yet worked this year to promote the comfort and well-being of workers in the practice of sport in the corporate world and health. In terms of medical, significant curative activities and support for employees and families have been conducted in medical facilities, both external and internal. Internally, for example, 28,528 medical acts were made between general consultations, antenatal care, nursing care, immunizations, family planning, etc. Regarding prevention, many actions were also conducted including medical campaign in disease prevention and occupational risks (annual screening visit and worker monitoring) and the program of medical information, education and employees’ awareness on the various risks including Ebola. So, many experts had been mobilized for this purpose: cardiologists, biologists, radiologists, ophthalmologists, oncologists, etc.
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The theme of the 2014 annual visit, focused on the preservation of our health capital with the slogan: «For our health capital, a daily active lifestyle and a healthy lifestyle.» With this device, all agents received a complete medical evaluation, including several reviews. A program called «lighten to be in top form» was also launched with the support of many specialists. It allowed employees through a diet and nutrition coaching and sports activities regularly carried out to feel at best, to correct nutritional imbalances and prevent the occurrence of metabolic diseases such as diabetes, obesity, high cholesterol and cardiovascular diseases in particular. Finally, awareness campaigns and training on the particular virus «Ebola», the dangers of tobacco have also been widely conducted with staff. Not less than 11 campaigns that have been conducted by the internal health services with regular posting videos on safety, managing stress and musculoskeletal disorders. In terms of the management of Health and Safety Committee, emergencies tests were also organized to familiarize officials with good behavior and useful and essential gestures to the control of risks and the assistance in case of discomfort or disaster on the workplace.
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RESSOURCES HUMAINES
annual report of activities Sonatel 2014
Pursuit of the Enterprise Project sites «United toward 2016» to carry out the necessary Sonatel transformations
To this end, the Managing Director recalled that the business plan «United toward 2016» still requires greater participation by all, so that in 2016, our company will be perceived as :
•B y our customers as best than all our competitors by offering services of quality among the best international standards; •B y our shareholders as a successful player with a significant potential residual growth; •B y institutional as a global operator backed by a world-class operator whose processes are troublefree in view of international standards: Quality, Safety and Environment; •B y the civil society as a socially responsible company, among the top contributors to local development and preferred partner of public authorities in the development of the digital economy.
• By our employees as the benchmark company attracting the best skills;
Sonatel is already a long story, but it’s also a promise, it is a future.
The Sonatel group launched in 2013 the coconstruction of a new Enterprise Project «United towards 2016» after «360° stakeholders vision of the Managing Director.» In October 2014, it was organized the Year 1 Enterprise Project Convention to take stock of the achievements of the 2013/2014 year and announce priorities per site for 2015.
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Sonatel 2014 annual report of activities
generalization Card O ‘: an innovation to facilitate access to care for employees The «Card O’ « is a digital platform, developed by Orange Business Services, enabling secure, paperless exchanges between actors in the health sector: patients, health professionals (doctor, pharmacy, laboratory, etc.), financial organizations financing healthcare (Disease Provident Institution IPM, insurance, government, health mutuals, etc.). Card O ‘, which facilitates the patient journey in access to care, has been successful in its pilot phase in 2013.
The generalization to all employees is effective since 2014.
a successful move to new headquarters on the “Voie de Degagement Nord” (VDN) The Sonatel headquarters have moved from the downtown city of Dakar to VDN thus opening a new page in the life of our company. Sonatel thus marks its print, urban planning and heritage of the city of Dakar with the construction of an ultra modern headquarters, operational and reinforces its image by participating in the emergence of a new business district. This new office marks a turning point in the way we work every day with a new work dynamic, more fluid, more effective. Thus, the office became a real part of development for staff.
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Sonatel 2014 annual report of activities
annual report of activities Sonatel 2014
SONATEL’S CITIZEN ENGAGEMENT Sonatel had been engaged for several years now in a process of Social Responsibility (CSR) and sustainable development, to integrate the social, societal and environmental aspects of its activities and interactions with stakeholders. It is for this reason that Corporate Social Responsibility has been raised to the rank of strategic pillar. Citizen engagement of the Sonatel group allows: • Meet the expectations and demands of customers and users • Mobilize and involve staff • Improve relationships with suppliers • Install a climate of trust.
3.1 Sonatel, operator engaged in the service of economic and social development in all countries
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he Sonatel group is still engaged this year in several actions and initiatives as part of its Corporate Social Responsibility policy (CSR), both in Senegal and in the countries of presence. Among the actions carried out in Senegal in 2014 we note: School internet agreement: partnership with the Ministry of Education for the free internet in public educational institutions of primary, junior and secondary in Senegal.
The Ministry of Education and Sonatel thought, through this agreement, that the improvement of the quality of education in public educational institutions of primary, junior and secondary in Senegal by ICT passes through, inter others, free access to the Internet for all public educational institutions. So the school offered Internet access includes: • a high speed internet access of 1 megabit, • the «My Orange Office» service to each institution with a domain name, 100 email addresses and web space for a website. SMS awareness and information: a partnership with the Ministry of Health and Social Welfare to improve the means of communication of Senegal Health services. It is for Sonatel, to make freely available to the Ministry of Health and Social Action of diffusion spaces for sms messages of awareness and prevention of the population. The Ministry of Health and Social Action defines upstream relevant awareness messages and transmits them to Sonatel which broadcasts on its mobile network.
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Sonatel 2014 annual report of activities
D4D: Orange big data competition open to the scientific community Dakar hosted this year the second edition of the challenge «Data for Development» in Africa. The D4D challenge, organized by Sonatel and Orange Group, in collaboration with the ICT business incubator, Upstart and under the supervision of the Personal Data Protection Commission (HRC) was to make available to the scientific community and IT developers, statistical data and samples from the Orange mobile network to enable them to develop research projects and ICT applications with a high social impact for Senegal. D4D mainly aims at the development and improvement of living conditions of populations. Thus, five priority areas were identified where needs were expressed in collaboration with line ministries and / or the partner institutions: • health, • agriculture, • transport and infrastructure, • energy • production of national statistics.
Fifteenth Summit of the Francophonie: Sonatel, the first partner for telecommunications services
Sonatel, with its Orange brand, Telecommunications Partner of major events in Senegal contributed to the success of the fifteenth World Summit of the Francophonie housed in Senegal from 29 and 30 November 2014. Sonatel has indeed mobilized substantial financial and human resources to meet the telecommunications needs of the General Delegation for the organization of the XV Summit of the Francophonie (DGF) and allow a smooth running of this international meeting. As a technical partner of the telecommunications services of the summit of the Francophonie in Dakar, Sonatel Group generated additional network investments of 254 million XOF, excluding taxes, for comfort in the use of different telecommunications services by members of the delegations. Telecommunications innovation of the summit in Dakar has been arguably the 4G access of Orange network in a pilot phase.
The D4D challenge illustrates both the Orange open innovation strategy and its approach to corporate social responsibility which ensures to make digital a lever for development and progress for all: individuals, territories and communities.
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The accompaniment is also done through sponsorship with four projects supported by Sonatel Foundation: • «Words, diversity, Art and Dialogue» of Agoravia; • «Franco Phonons» of the GIE Goorgoorlou; • the preparatory forum of youth and women of the United childhood in the heart of SineSaloum in Djilor Djidiack; • Exposition of the tapestries of the Senegalese Manufactures of Decorative Arts in Thies. An exhibition and artistic and scientific activities have been designed on the premises of Sonatel Foundation. Major works have been exhibited in this space.
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SONATEL’S CITIZEN ENGAGEMENT
annual report of activities Sonatel 2014
«a student - a computer» program to connect the students’ computers The «students’ computers» project had incorporated this year a connectivity component (Internet access) through a partnership between the Ministry of Higher Education and Research (MoR) and Sonatel. Thus, Sonatel, through its subsidiary Orange Business Services (OBS), has made available to the beneficiary students, an appropriate Internet access solution which consists of a high speed broadband Internet key and a mobile Internet package.
•T he 21 Megabytes key at a discount price of 10 000 XOF TTC The Ministry of Higher Education and Research expressed his satisfaction for this contribution. In fact, Sonatel allows the Government of Senegal to meet the challenges of student access to a quality higher education through the support of Information Technology and Communication (ICT).
The amount of the contribution of Sonatel to the program «one student - one computer», amounted to 20,000 students to about 1,750 billion XOF, made up of 80% reduction on the fee of 3GB Internet package and a subsidy granted on the key. Orange Business Services thus offers to students receiving two types of Internet Key packaged with a 3GB package: • The 7 Megabytes key offered;
3.2 Sponsorship: 12 years of commitment Sonatel Foundation for the well-being Sonatel Foundation, investing since its creation in 2002 in the economic and social development of Senegal, participates through its actions to improve population living conditions for a «better be» sustainable social. Among the actions carried out this year by Sonatel Foundation included:
3.2.1- Health: actions in six priority areas Having at heart the preservation of the health of population, the Foundation has once again focused its efforts on six areas: • Raising the medical technical tray; • The fight against malaria; • Support for children with disabilities; • Free medical care for older people (the third age); • Support for research; • Solidarity.
capacity of 30 seats to the staff of Diamniadio Children’s Hospital. Five medicalized ambulances to different regions and 01 transportation bus of students with disabilities: five medicalised ambulances were awarded this year to the Minister of Health and Social Welfare, Dr. Awa Marie Coll Seck. They are intended for the following structures: Health Post Agnam Liboudé (Matam region), Health District of Podor (Region of Saint-Louis), Koki Sanitary District (Region of Louga), Birkilane Sanitary District (Kaffrine Region) and Medina Yoro Foulah Sanitary District (Kolda Region). Similarly, a bus with 30 seats to transport students with disabilities for the Grand Yoff Talibou Dabo specialized center was also offered during this opportunity to improve their conditions of study.
Some major achievements in 2014: Two buses for the Diamniadio Children’s Hospital: Sonatel Foundation used the occasion of the presentation of his Annual Report to provide two buses with a
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Sonatel 2014 annual report of activities
giving free medical care for 1,502 elderly people in Dakar and regions in 2014 ... The Sonatel Foundation, a pioneer in free medical care for people aged 65 and over, assisted them again in 2014 through free medical care sessions. The medical team of Sonatel Foundation led by geriatrician Dr. Ousseynou Ka proceeded to chronic disease screening and consultations with 1,502 older people in mainly in Dakar, Ndiassane, Affe Djoloff and Diourbel. These consultations beyond screening, first aid, oriented and treated ongoing disease, while providing practical advice for active aging. Sonatel Foundation has focused this year on rural communities where seniors have more difficult access to medical specialists. These medical expenses are supplemented by a device called «Kepaaru mag gni», awareness and exchanges afternoons on chronic diseases as a theme and whose target is the elderly community and their families. The various specialists present on this occasion gave some tips and recommendations. The theme developed this year has raised awareness among participants on nutrition for the elderly and monitoring its treatment, healthy lifestyle, sport and play to keep the memory, among others. mobilization against Ebola
state of the art equipment for the health district of Mekhe Sonatel Foundation has equipped this year the health district of Mekhe in state of the art medical devices with clinical chemistry analyzer, power vacuums mucus, a color doppler ultrasound system, delivery tables, delivery boxes and metal speculums. These donations were made in the presence of the Mayor of Mekhe Mr. Maguette Wade.
3.2.2. e ducation: access and excellence for all The access and retention of girls in school, excellence in academic achievement, support for the illiterate or illiterate children, support for disadvantaged children and early childhood are the Foundation’s priorities in the field of education. support to the Contest «Miss Mathematics and Miss Sciences» For the 3rd consecutive year, Sonatel Foundation funded the organization of the contest «Miss Mathematics» for the fourth class and «Miss Science» for second class. This support which aims to promote science subjects for girls has for objective to increase the skills and the number of girls and to inculcate a taste for mathematics and science across the colleges in Senegal. support to the General Competition 2014 Edition True to its policy of promoting excellence in schools, Sonatel Foundation has awarded for the 13th consecutive year the best students, winners of the 2014 General Competition.
The Sonatel group has mobilized a lot to improve the response capacity of the Ministry of Health and Social Action dealing with the Ebola disease that has wreaked havoc in our subregion. Sonatel has strengthened the media means of Senegal Health services particularly in terms of raising public awareness, risk prevention of diseases and emergency management and, through its Foundation, has made available to the health authorities, 7,500 protection kits for the Senegalese pilgrims to Mecca. Similarly, thousands of antiseptic hand gels were distributed in various events promoting a clustering of populations in Senegal: back to school, national football team competitions, Magal of Touba, Maouloud in Tivaouane, etc.
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digital education: 72,000 beneficiaries, 30 schools in Senegal La Fondation Sonatel s’est impliquée davantage cette Sonatel Foundation has become more involved this year in the field of digital education with the launch of a program set up by the Orange Foundation in Africa. This digital education project is deployed in four pilot countries: Cameroon, Niger, Madagascar and Senegal by the Orange Group Foundations in the country to complement the curriculum of African States in primary and secondary schools by providing free educational content in digital form. The schools selected for this program start accessing content via Wi-Fi connection and a browser. They have the ability to connect to the Internet to make automatic updates of content: Encyclopedia (Wikipedia), Mathematics and Science (Khan Academy), digital books (excluding school books). With Sonatel Foundation, the Digital Education program began in Senegal, benefiting about 72,000 beneficiaries in 30 primary and secondary schools, chosen in Dakar and regions by the Ministry of Education.
annual report of activities Sonatel 2014
producers, development agents and universities, enabling them to benefit from the scientific community to get a better return on their work. encouragement of vocations in the mathematical and telecommunications sciences Sonatel Foundation granted scholarships to 03 students in 2014 AIMS-Senegal (African Institute for Mathematical Sciences) which is a non-profit center of excellence for higher education, research and public engagement in mathematical sciences for African students. Its mission is to identify and train the best students from the African continent to prepare them to become leaders of African development in academic, industry and governance. Sonatel Foundation has contributed to actions to encourage vocations among students in the field of telecommunications.
3.2.3 promotion of Culture in Senegal Sonatel Foundation participates in the promotion and spread of culture in Senegal by supporting related actions: • training for careers in Culture; • preservation of heritage and memory; •regional cultural festivals and vocal music. project Village of Sonatel Foundation Sonatel Foundation undertook the construction «of a school, a health center and a water point» in favor of the village of Thicate Wolof, non-electrified village of Birkilane department in Kaffrine region (245 km from Dakar). The village of Thicate Wolof which polarizes other 14 villages with a total population of about 3,000 inhabitants has been designed with the following components:
Thus, 1,500 tablets, 60 servers and 30 digital paintings are available to primary and secondary schools already chosen in Dakar and in the regions by the Ministry of Education. equipment of the PEMEL center: technology at the service of the population of Podor Sonatel Foundation supported the Podor PEMEL Center for the purchase of equipment to transmission system, studio equipment of a community radio and a multimedia room. This support aims to popularize science among the population and around Podor, to contribute to the education and cultural development of the entire community. It aims to facilitate exchange between farmers,
• education: a school of 06 classrooms, an administrative block, a block of latrines, a fence wall, equipment for the principal, teachers and students. • health: building a health station with an infirmary with a consulting room, a treatment room, a waiting area, two watching rooms, a pharmacy depot, motherhood with a desk for midwife, a work room, a delivery room, a corner for newborn, a housing for the nurse, a housing for the mid-wife - woman and the boundary wall.
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Sonatel 2014 annual report of activities
annual report of activities Sonatel 2014
OUR ACTIVITIES
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the Senegalese market
4.1 mobile Orange has captured over 76% of market growth in 2014
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he year 2014 was marked by growth in mobile customer base by 9%. At the end of the year, Orange subscribers’ base has more than 8,097,000 customers. Orange has captured over 76% of the growth of the mobile market in 2014, the rest is shared by its two competitors. Thus, the mobile penetration rate of the population is at 106% at end-December 2014.
Orange loyalty program Sargal
To thank its customers for their loyalty, Orange launched this year, its new loyalty program «Orange Sargal» to all customers Diamono and accessible free via USSD code # 221 #! Sargal Orange is the first loyalty rewards program in telecommunications in Senegal: once it falls, the customer earns points for each top (100 Xof = 1 point). He consults his points balance via the # 221 #.
According to the report of the Regulatory Authority for Telecommunications and Postal in Quarter 3 of 2014, Orange has consolidated its leadership in the mobile internet with a market share of 70% on internet keys and 62% on the mobile phone. The value added services showed during this year their potential for growth because their turnover is up by + 51%. This growth of the Orange mobile subscribers’ base reflects the many innovations to benefit customers noted during the year include:
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Sonatel 2014 annual report of activities
Customers may, at 50 points, convert them into products Orange (call minutes, SMS, Internet pass, unlimited numbers, illimix) or valid voucher at Orange and among many partners from various sectors (list available on www.orange.sn/sargal). And for the best customers, in addition to the points program, Gold and Platinum status are set up, evidenced by Gold and Platinum cards, which are entitled to exclusive benefits: • The Aïcha personal assistance to meet all demands, from the everyday to the exceptional, available at 600,221; • Exclusive benefits from local and international partners; • A dedicated support and priority customer service and the Sonatel Cheikh Anta Diop and Almadies agencies.
new features Dalal Tones
Dalal Tones Orange is a service that allows customization of the ring waiting for calls. To enrich the service, in order to better satisfy customers and meet their expectations, the following new features were launched towards the end of the year: • Dalal Group: Dalal to assign a contact to a group (family, office, friends ..); • Dalal selection: enables a selection of 5 Dalal tones at a flat rate; • Dalal status: informs correspondents according unavailability (in a meeting, driving, class, ...); • Dalal dedication: to dedicate a dalal to someone special; • OBD (Out Bound Dailing) can easily and simply upload the tops of time listening and automatically choose the desired Dalal. The principle and the price of the service do not change. And if the customer does not have enough credit for the monthly billing, he may benefit from the daily billing for both the subscription as well as the dowloading .
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internet Revolution key 2 (42Mbs)
Orange has enriched this year’s key Internet everywhere range with the launch of the revolution key 2 of 42 Mega. The package 42 mega is an internet key ready to connect, a prepaid Sim and Internet Pass of one month offered limited to 10 GB. The internet key 42 Mega supports the HSPA+ network. It allows access to the internet from a computer anywhere in Senegal on the best 3G network in Senegal and can reach a theoretical maximum debit up to 42Mbit / s in download and 5.76 Mbit / s in upload. The key 42 Mega is compatible with any operating system (Windows, Linux, Android, iOS).
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OUR ACTIVITIES
annual report of activities Sonatel 2014
Mobile banking: Orange Money is pursuing its development and innovation Sonatel continued his innovations in the field of mobile banking especially in terms of payment of utility bills and merchant payment bill payment: Payment of Senelec bills, SDE, Canal horizons, EXCAF, Sonatel ... • customer benefit: pay bills with ease and without moving at any time of day. • partner benefit: no more counterfeit money or possibility of diversion. • country benefit: increase of banking rate and reducing money laundering risks. merchant payment: fuel purchases at TOTAL and EDK, bill payments in various restaurants, shopping in Casino and Citydia Express ... • client benefit: securing money no more cash in the pocket • partner benefit: over counterfeit money or possibility of diversion, better accounting, innovation. • country benefit: increased banking rate and reduction of risks of money laundering money transfer: • customer benefit: send money across Senegal, Mali, Ivory Coast safely without moving • country benefit: traceability of sending operations and receipt of money throughout the country and part of the international. mobibank: pay money from his Orange Money account to their account BICIS and vice versa. • customer benefit: fill its OM account or BICIS account without moving. • partner benefit: transaction flows. • country benefit: increase of banking rate
PAM : food distribution scholarships via Orange Money: 1.5 billion to 25,000 insurance offers via the mobile in partnership with Allianz • customer benefit: I insure myself and my entourage • partner benefits: insurance more accessible • income countries: developing savings and insurance
4.2 fixed-lines and Internet: development of uses
These two innovative offerings will enable to democratize and standardize the triple play on ADSL access in Senegal with an attractive price from 29,900 XOF / month.
home and Home +
The new Orange TV also allows an unprecedented TV experience in Senegal with innovative features such as Direct Control, the Digital Recorder or the Electronic Programme Guide; all these features create a totally new rich and interactive experience.
Orange under its ADSL subscribers’ reorientation strategy to up to the market, launched in the month of April 2014, two new multiplay deals: Home and Home +.
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Sonatel 2014 annual report of activities
8th edition of Orange day: all mobilized for our customers
service stations, emergency, hotels etc ...), the ability to perform all the orange money transactions from an android mobile compatible terminal,, online purchase of newspapers etc ...
4.3 business service: proximity and B2B structuring deals The corporate services were strengthened in 2014 with a proximity approach vis-à-vis SMEs and SMIs, added to the launch of structuring B2B deals.
4.3.1 b etter addressing SMI/SMEs with the doubling of the number of spaces Pro Orange day has become a familiar annual appointment for our customer. This edition, very special because it was the 8th edition and it was under the seal of the celebration of 8 million customers, great occasion to get even closer to our customers, increase Orange brand awareness, and put in illustration our innovation value. Thanks to the digital activation associated with this day, we also became the first Facebook page of Senegal across all pages. Sonatel staff have been all transformed on this occasion as ambassadors of Orange offers to develop and enhance the reputation of our offers and encourage customers to make our brand their preferred one.
innovation
• camp code: making co-innovation services, by encouraging local initiatives to create innovative services and supporting their implementation. The students were involved for the first edition and a pair one from Thies and another from Dakar were winners. They have subsequently benefited from long paid internships to allow them to finalize their products / services. • challenge API: through which the Orange Group has decided to open the billing API, USSD and SMS to 10 startups so that they will develop services. The company MLouma was awarded through its project designed to facilitate farmers’ selling their agricultural products ... • mobile applications (Senmap, Senkiosk, etc.) pour permettre aux populat(Senmap, Senkiosk, etc.) to enable people the geolocation of services (pharmacy,
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In 2014, the number of Pro spaces increased from four to eight for a closer commercial presence in the SME PMI target, Pro. The purpose of these spaces is to simplify the customer experience in receptions with strong representation of clients or business prospects. Customers pro and consumers have different queues. This strengthening of Pro spaces was accompanied by a field presence with shares of promotions and animation during the year including seminars and afterworks customers, business tours, etc.
4.3.2 launch of B2B structuring deals blocked mobile packages
This is a hybrid offer to help control costs for pro customers because it allows them to control their consumption with a blocked package on the voice. They have the ability to recharge credit in excess of the amount subscribed to continue to consume.
cloud Pro Orange
Orange Business Services has launched this year the first cloud computing offer to the Senegalese market and the sub-region. Orange Cloud Pro enables companies to connect via a portal and access web services to a variety of applications: ERP with Sunu ERP, collaboration solutions with My Office, schools management or the real estate applications, etc. Orange Cloud Pro is one of the first services embodying Sonatel will to make the cloud a real growth driver.
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OUR ACTIVITIES
annual report of activities Sonatel 2014
Sen Health Pharmacy: an innovative solution for access by SMS to pharmacies on-duty To save time spent searching for nearby pharmacies on duty and given the very high penetration rate of mobile phones in Senegal, Sonatel Group, in partnership with the Union of Pharmacists, designed the Sen Health Pharmacy service. Sen Health Pharmacy is a solution available to the populations to facilitate their access to information on pharmacies on-duty via the mobile. This is a mobile portal dedicated to health accessible by SMS with the dedicated number 22100. The solution also includes an application accessible to pharmacists allowing them to dynamically manage the planning of pharmacies onduty on their area.
4.4 pursuit of the customer service transformation project: key differentiation and customer loyalty Year 2014 was marked by the acceleration in the implementation of the Orange Customer Service Transformation Program named Happy, with the implementation in 2014 of the certification project to the COPC (Customer Operations Performance Center), which is a priority project of Happy program. Notable progress was noted this year with the level of implementation of the program Happy and the COPC Project reflecting encouraging progress towards the achievement of high-performance target benchmarks referred by Sonatel’s Customer Service for Markets related to Consumer, Professional and Enterprise.
certification of 45 coordinators approved COPC (COPC RC), the implementation of Happy communication plan and the starting of training on customer culture (Orange Way).
the deployment of contact centers hightech tools: including WFM (forecast on call flows),
Verint (transaction monitoring), Hot Survey (hot-satisfaction survey), Proactive Contact Voice (recall of clients), InfoMart (Reporting), Knowledge Base, Portal (Front Office applications interface), Full SIP.
strengthening of prevention of the malfunctioning approach: with the Steering of 4 Groups for Quality Improvement on the impinging on malfunctions and / or recurring, entertainment prevention device (pilot phase conducted over 2 months for a generalization from January 2015) and the monthly monitoring of the top 5 complaints «Fixed-lines, Mobile, Internet TV».
strengthening of the monitoring of customer satisfaction with the implementation of the orders closure platform, shipping and production of a monthly report on customer satisfaction.
We can mention among the major and structuring actions undertaken in 2014 by customer service:
awareness program to quality customer relationship: with the progress of the outreach plan
to the COPC standard for nearly 450 people, the implementation of COPC communication plan, training and
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Sonatel 2014 annual report of activities
Our subsidiaries abroad
4.5 Orange Mali: growth despite a difficult economic and security context In 2014, Orange Mali has experienced a year of growth, despite a difficult economic and security situation in Mali. Orange Money has experienced an exceptional growth. The distribution of refills has continued to be strengthened to ensure that everywhere and all the time the availability of refill cards. The corporate market opened up new opportunities by expanding the bandwidth to the «data» solutions.
4.5.1 a company at the heart of Mali investments in the sector of activities Orange Mali has invested more than 398 billion XOF of which 43.5 billion in 2014 in the densification and improvement of the quality service of its network, bringing to 1,300 the total number of site radios built to date. Orange Mali is the first network of Mali: • Over 83% of the territory coverage; nearly 16,000 villages covered over the 18,000 Mali counts. • 1,300 site radios built to date. • 3,000 km of optical fiber deployed to the improved access of Mali • Deployment of 3G in all the regional capitals • $ 15 million invested to ensure the access of Mali to the submarine cable ACE which Orange is co-owner • Reconstruction of almost all of the sites destroyed during the security crisis in the north of the country investments in human resources Orange Mali is constantly investing in developing the skills of all its employees. Through sustained training programs, the company professionalizes each of its e ployees and also prepares them for new growth of the businesses of its activities. Orange Mali also invests in security and medical coverage for each employee and his family.
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investments into the economy of Mali There are more than 93 billion XOF have been paid this year to the Treasury in respect of taxes, duties and dues. Supporting local suppliers was reflected in the payment of more than 30 billion XOF for bills and 22 billion XOF for commissions paid back to distributors. development of financial inclusion Less than 7% of the Malian population has a bank account. Orange Money has enabled many Malians to benefit from financial services through: • Accessibility and the strength of our distribution network • Rich range of services available At the end of 2014, Orange Money in Mali has more than 2.4 million accounts and an effective presence of more than 10,000 points of deposit-withdrawal spread across the country from North to South. valued solutions to 15 million of customers, individuals or businesses • Prepaid and postpaid offers for voice and «mobile data» • Internet offers for all, both for home and for businesses: the first Fiber Optics access to the subscriber have been deployed with speeds exceeding 100 Mbits • A catalog of offers and services with all integrated solutions for professionals and businesses, SMEs, NGOs and institutional institutions. mobile: nearly 19% increase in CA Voice With a country coverage rate of over 83%, we are working to ensure that every Malian is an offer tailored to its needs. We therefore propose to our customers a wide range of products and services. an Internet solution for each Malian • 3G +: access via smartphones and tablets, 3G + keys, the Wimo (portable WIFI for all), the Flybox • Wimax: unlimited offers for public customers • Radio links: speeds of up to several Mbits possible all across Mali • Optic fiber: access of several mbits over 100 Mbps for business
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OUR ACTIVITIES
fixed-lines: Call at lower costs • The Livebox and Flybox also allow the homes’ equipment with a landline at very competitive prices (calls to fixed-lines in US, Canada and Europe at 50F / min, calls to Orange fixed-lines at 10F / min and free between livebox phones)
annual report of activities Sonatel 2014
Sini Tonon: savings accessible to all • remunerated savings proposed by NSIA in partnership with Orange Money; • A life insurance available from 40,000 XOF of savings; • Medical coverage in case of difficult childbirth.
enterprise solutions: focus on innovation • Integrated Services: turnkey solutions from start to finish (engineering, links, equipment, services ...) • Interconnection offer for international site (RAFIA) • Enterprise Telephony offer with Micro PBX functionality (Business Orange Box) • Offer Machine 2 Machine: geolocation offer and security • information and alerts offer via SMS (SMS Web) terminals: more than 600,000 smartphones connected to our network in 2014 • Orange Mali has a wide range of tablets and smartphones: iPhone 6, iPhone 6 plus, Samsung Galaxy, Tablets, Pixi 2, Pixi 2 Max, mini Idol, Idol Alpha, YUV smart, Pop 7, Pixi 7 ...
4.5.2 Mali Orange encourages innovation Our ambition is to improve the everyday lives of Malians by creating simple and innovative services that help them communicate and share better. First edition of the Orange Innovation Exhibition The first edition of the Orange Innovation exhibition held in Bamako hosted 5,000 visitors. Orange Mali offered visitors rich moments in discovery and experience. Were exposed innovative products and services projects to the visitors for the future. Senekela: technological innovation at the service of agriculture • a service that works in partnership with the Institute of Rural Economy, IICD and Rongead; • a call center for farmers; • Calls are supported by agricultural engineers; • The service relies on a network of information collectors in two regions, which data back every day on the price of 12 agricultural products; • Farmers can have the information in French and Bambara on all their queries daily: planting methods, seed sowing time, fertilizer ... • Number: 37333, price: 50 XOF / min; • USSD menu: # 222 #, fee: 75 XOF / query.
and also ... • launch of the first Malian smartphone: YUV Smart; • learn English: a sms alerts service; • HD Voice: HD voice accessible to all.
4.5.3 c itizen actions: transform the lives of Malians volunteering and demanding corporate social responsibility policy The Corporate Social Responsibility reflects our consciousness, our desire to ensure the most positive impact possible on the people, society and the environment. •M ore than 350 solar sites installed to prevent thousands of tons of CO2 emissions each year; •1 ,879 remote villages connected through community phone Djamaa Phone; •S upport of the development of ICT: GSM equipment donations for the opening of 2 GSM laboratories in schools UFTI and ENI; •E ntrepreneurship Support: 62 Malian files were submitted to the Orange Prize for Social Entrepreneurship in Africa, launching an incubator project; •D ialogue with the people of the Diaspora «connected migrant « in Bamako, Kayes and Paris.
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Sonatel 2014 annual report of activities
Orange Mali Foundation: 10 years of social needed actions to create more solidarity ... ... in the field of health 300 million XOF invested in 2014 for: • The campaign against the Ebola virus; • Ophthalmologic caravan for older people (5,623 consultations, 877 cataract surgeries); • Dialysis kits for the Point G Hospital (over 200 users); • Constructions of maternities; • Oral Screenings for the benefit of diabetes patients; • Cervical cancer screening of the uterus; • Fight against malaria: distribution of treated nets; • The World Day against Leprosy; • The contribution to the fight against obstetric fistula; • The gift of a dental chair for Kayes hospital. … in Education: In 2014, Orange Mali Foundation has contributed 200 million XOF to education: • Construction of schools; • Management of costs of birth certificates to enhance the education of poor children; • Excellence scholarship program for students from disadvantaged backgrounds; • Support for the literacy project of 540 women in Yelimane; • Support for the education of underprivileged children. ... and also: • Distribution of food and essential products in structures that support disadvantaged children; • Mills Donations to support women’s groups; • Assistance to street children. Orange first supporter of sport in Mali For 10 years, Orange supports the sport in the country through the support of several sports federations, local clubs, sporting events and various sponsorships. About 800 million has been invested in sport by Orange in 2014 (Visual support for the Eagles, First Supporter, basketball players ...)
4.6 Orange Guinea: continued leadership and coverage of all sub - prefectures Orange Guinea maintains its leadership in 2014 with a market share at year-end of 50.6 percent (an increase of 3.3 points compared to 2013).
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This performance is based on the extension of coverage into new areas, densification in urban areas and business momentum. At the end of 2014, Orange covers all the sub-prefectures of Guinea in 2G and all main towns of prefectures in 3G. The mobile subscribers’ base at end 2014 amounted to over 4.5 million against 3.2 million at the end of 2013, an increase of 1.2 million. This performance is based on the commercial dynamism with the launch of innovative offers: • Merchant payment with Orange Money; • No credit beep; • Facebook via USSD; • KDO promo Orange. At the end of 2014, the Orange Guinea Internet Mobile subscribers’ base amounts to about 650,000 (including 63,000 active keys). This subscribers’ base increases 63% compared to 2013. This growth was supported by investments in 3G and in the ACE submarine cable and also by attractive offers with the launch of the Flybox, Domino modem and Pixi.
4.7 Orange Bissau consolidated its leadership in innovation 2014 was a year of innovation for Orange Bissau. It was marked by the launch of iconic deals with a very positive impact on the business and the image of the brand as: • No Credit Beep • Nomad • Pass illimitados (bundle) • My Orange, • Transfer Country • Orange WiFi • SMS Chat The organization of pilot 3G + enabled to introduce of this technology to its customers and its partners.
4.7.1 significant investments to improve the quality of mobile network services (voice and data) More than 5.7 billion XOF of investments were made in 2014, the cumulative investments since the inception of Orange Bissau in 2007 amounted to more than (33.7) billion XOF.
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OUR ACTIVITIES
annual report of activities Sonatel 2014
These investments have mainly allowed: • To develop the network coverage by opening up several regions and cities; • To deploy innovative new offers; • To improve the quality of voice and data services; • To reduce our energy costs; • To deploy 3G in a pilot phase in Bissau, Gabu and Bafata;
4.7.2 The basis of a strong CSR policy
The development of consecutive market to these investments enabled Orange Bissau: • To strengthen its contribution to state revenue: • + 5.01 billion XOF were paid for taxes, taxes, fees, social security contributions and customs duties, representing about 4.1% of the state budget 2014. • To contribute to the creation of wealth for the benefit of local private enterprises: • + 4.2 billion XOF paid to local suppliers • + 1.7 Billion XOF commissions paid to our partners’ refills distributors. • To contribute more significantly to job creation with 151 direct jobs created (85 permanent and 66 temporary employees) and more than 17,576 indirect jobs (wholesalers, semi-wholesalers, retailers). • To generate more export earnings of 4.8 Billion XOF paid by foreign telecommunications operators for the year 2014, thus contributing positively to the trade balance of Guinea Bissau.
Orange Bissau has also strengthened its civic activities. Through various initiatives it has supported important programs in the fields of health, education and social peace: • free WiFi : free WiFi deployment at the national stadium for the inauguration of President of the Republic and in hotels such as Azalai and Malaika for international observers during the election campaign. • social welfare activities for underprivileged children: distribution of toys and food to SoS villages, in the accompanying childhood center «Nino Criancias». • prevention against Ebola: donations of equipment (wheelbarrows, shovels, bleach, etc.) to the Ministry of Health, in the city of Gabu border with the Republic of Guinea. • launch of Orange price of social entrepreneur in Africa to encourage private initiatives for using ICT in the service of population. • school supplies collection campaign (notebook, pen, pencil, etc.) in partnership with the Club RFI Bissau.
As in previous years, Orange has been the sponsor of the biggest cultural event in the country: the Carnival. The company is regarded as the main patron of the country, leading partner of culture. It helped to showcase the Carnival beyond the borders, in webcasting the highlights of the event.
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Sonatel 2014 annual report of activities
annual report of activities Sonatel 2014
NETWORKS AND INFORMATION SYSTEMS
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Orange, leader on technical service quality
The measurement campaign of the quality of voice and data carried out by the Regulatory Authority for Telecommunications and Post (ARTP) in 2013 had named Orange leader on the quality of technical service in Senegal in both coverage and quality service voice & data 2G & 3G. 2014 was a year of consolidation and improvement of the results of the year 2013 obtained after the implementation of an ambitious program of densification and extension of coverage of the mobile access network.
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5.1 modernization of the mobile network
5.2 flow rates increase for 3G
onatel anxious to have a mobile network at the cutting edge of technology has launched major upgrades and expansion of the mobile access network through an ambitious project called RAN Renewal. With the latest generation of RAN RENEWAL, equipment of last generation is ready to support the 4G. These new facilities have reduced the energy consumption to contribute to Sonatel’s environmental policy.
2014 was the HSPA + development year with coverage that goes from 50 to 550 sites. This technology allows multiplying by 3 the flow rate compared to 3G +, with speeds of up to 42 Megabits per second.
This project also allows the introduction of 3G technology 900 that favors the development of the mobile data network.
The pilot LTE (4G) was held in 2014 consolidating Sonatel leading position in the Data Mobile and corporate on the cutting edge of telecommunications technology.
641 sites were able to be upgraded in 2014 mainly in the regions of Ziguinchor, Sédhiou, Kolda, Tambacounda, Kédougou, Kaolack, Louga, Saint Louis, Thies and Kaffrine. The program will continue until 2016 and will cover the entire Sonatel mobile network.
5.3 4G test in Senegal succeeded in Sonatel
LTE is present in 30 locations in Dakar and 10 on the small coast of Saly and the CICAD site in Diamniado which hosted the summit of the Francophonie. Sonatel has also deployed six sites during the Touba Magal. Sonatel is the only operator to have deployed 4G in 3 major cities of Senegal (Dakar, Saly and Touba).
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Sonatel 2014 annual report of activities
HD for example videoconferences on your mobile, with excellent image quality and sound and the option premium in view documents directly on mobile screens. Moreover, all Orange mobile data offers are already 4G compatible and will be used by clients that meet the prerequisites: mobile TV, mobile Internet (browsing, streaming), E-mail on the move, Business Everywhere, Internet Everywhere BlackBerry , etc.
5.4 evolution of IP core network, mobile voice, national and international transmission and service platforms
With the pilot of the Orange 4G, Sonatel have covered major events such as the Summit of the Francophonie and the Grand Magal of Touba, which had strengthen the brand image of our country in the field of technological innovation. For example, we equipped all the Francophonie delegations with 4G terminals in partnership with the Government of Senegal. By bringing the flow rates ten (10) times higher on rising or falling links on 3G + and greater flexibility in terms of traffic capacity, 4G will revolutionize the customer experience on mobile broadband. For example, downloading a 5MB music file is 2 minutes on 3G, 8 seconds on 3G + and 1 second on 4G. To download an album of 50 MB, it is necessary and 19mns30 on 3G, 1mn15 on 3G + and 10 seconds with 4G. Ditto for the movie download: for a film with a capacity of 650 MB, the client will wait over 4h on 3G, 16mn on 3G + and 2mn only with 4G. It is to note that Orange customers will access this 4th generation network can indeed: • To benefit from the essential functions of today, combining quality and speed: consult a website, listen to online radio, watch a video, upload a file or application, etc. • To simultaneously access to multiple Internet services without quality degradation, such as: watch a video while browsing the Internet; • To explore new uses such as: mobile cloud computing that provides the ability to work while you’re on the go, like being in the office; the cloud gaming that can play games in HD consoles on your mobile or tablet anywhere and on any device; video mobile to mobile
46
The network has experienced many other important developments during this year: • Modernization of multiservice IP core network in all areas with high traffic potential for migration or strategic «all IP». • Modernization of the Network of heart Datamobile to support traffic growth and evolution toward LTE (4G) • Introduction of new platforms bringing much more flexibility for new offers (Dalal, Seddo, Sargal, USSD, Orange Money) • Gradual migration of subscribers to the new TV platform with advanced features and a full IP headend. • Modernization of the transmission network with replacement of aging fibers on the North / South Loop in order to increase from 2.5 Gb / s to 10 Gbit / s; and a cable 36 FO Koumpentoum between Tambacounda and Goudiry a distance of about 220 km was laid down and the project FO Tamba Kédougou, Musala is underway on 371 km. • Expansion of capacity of switching centers and mail centers, with a doubling of capacity
Sonatel has launched the construction of a tier-1 data center Sonatel this year launched the construction of its Rufisque Datacenter. This project will promote the development of cloud in Senegal and in the sub-region with a «green» solution that optimizes the use of energy and enables companies to access at lower cost to a range of rich Cloud services. Sonatel respectful of the recommendations of the ARTP also started the number portability project.
Sonatel 2014 annual report of activities
annual report of activities Sonatel 2014
SONATEL ABROAD securing bandwidth As part of its bandwidth Internet security policy, Sonatel has participated in the Upgrade 4 of SAT3 with an investment of 1 Million Dollars for a capacity increase of 7 new STM 16. The commissioning was conducted in May 2014. Sonatel also actively involved in the Working Group for upgrades 1 of Atlantis 2 and upgrade 5 of SAT3.
ITU: the Senegal re-elected as member of the Council of the Union Sonatel attended the Plenipotentiary meeting was the renewal of the management team of the Union with the election of Houlin Zhao (China) as the new Secretary General to replace Hamadoun Touré. Mr Malcolm Johnson (United Kingdom) was appointed Vice-Chairman. He was replaced as Director of TSB by the Korean Chaesub Lee. Mr Brahim Sanou (Burkina Faso) and Mr. François Rancy (France) retain their posts respectively Director of the Office of Development of Telecommunications and Director of the Office of Radio communication. The 48 seats of the Council of the Union have been renewed and Senegal was re-elected as a member of the Council of the Union in the quota of 13 seats for Africa. In the Delegation of Senegal led by the Ministry of Telecommunications, Sonatel was represented by Mr. Birago Beye and Mr. Saliou Toure who hold the Co-chair of the Africa Group of the Working Commission 3 of the ITU. The Senegalese delegation participated in the work of the Commission 5 for Political and legal aspects.
This commission has developed numerous recommendations including those that: • On the frequency of RTI (every 8 years); • On alternative call procedures allowing recognized operators to take action on the types of calls that have a negative impact on the quality of service or income; • On the strengthening the role of ITU on issues of international public policy issues pertaining to the internet and the management of internet resources, including domain names and addresses; • On the strengthening the role of ITU in building confidence and security in the use of ICTs; • On the protection of children while on-line; • On the 2020 Connect Program for the development of ICT in the world whose objective is to connect the remaining 1.5 billion users by 2020.
fight against fraud by-pass SIMBOX The year 2014 was also marked by a resurgence of SIM box fraud. The implementation of effective tools and the deployment of considerable means to fight against this crime with effective coordination of Sonatel competent teams helped dismantle criminal networks with the support of security forces (police, national security guard). The struggle continues, fraudsters adapting themselves and also going through the competition networks. Effective collaboration with other operators and ARTP is more relevant than ever to sustainably eradicate this harmful practice for the ecosystem and income of the country.
49
Sonatel 2014 annual report of activities
digital Passage TNT Project Sonatel accompanies the Group Excaf in the implementation of TNT with the provision of telecommunication of transmission links and national and international publicity, and co-localization / sharing sites. Quality service is expected in the very short deadlines so that Senegal meets the deadline in June 2015 for the passage of broadcasting from analog to digital.
In 2014, Sonatel, in collaboration with its partner STC (Saudi first network), was able to launch innovative offers on roaming calls with call and reception rates very competitive. The same model was also deployed on all countries of the Christians Pilgrimage roadmap (France, Italy and Israel) in collaboration with our partners.
pilgrimage to the holy places (Mecca and Christians).
A powerful tool was acquired to test the level of real-time quality of service throughout the duration of these pilgrimages.
Sonatel as every year accompanied the Senegalese pilgrims to the pilgrimages to holy places.
50
Sonatel 2014 annual report of activities
annual report of activities Sonatel 2014
FINANCES
>
key figures and Sonatel share in the stock exchange
53
Sonatel : integrated telecommunications operator
Orange Guinea Orange Mali 89.37%
70.05%
Orange Bissau
mobile, Internet, data
90%
Sonatel SA (fixe, data, Internet)
employees 8%
Orange 42%
54
float 23%
Republic of Senegal 27%
annual report of activities Sonatel 2014
100%
Mobile
Sonatel Mobiles
Internet
Business Solutions
Sonatel Multimedia
Sonatel Business Solutions
4% 1.6% 105.7% 1st/3 58%
GDP inflation penetration position market share
4.8% 1.8% 122% 1st/3 54%
Guinea
GDP inflation penetration position market share
Guinea Bissau
Mali
Senegal
strong and dynamic market positions: strengthened positions in all our markets GDP inflation penetration position market share
2,9% 11.8% 73% 2nd/6 51%
GDP inflation penetration position market share
3.5% 1.7% 60% 2nd/2 48%
fixed line– mobile – internet – leased lines – TV adsl – Orange Money
strong and dynamic market positions : strengthened positions in all our markets (next)
Sonatel
Orange
strong growth still driven by the mobile business
subscribers
2012
2013
2014
281 762
293 063
284 306
4%
-3%
mobile
17 911 057
22 000 003
25 942 396
23%
18%
internet
108 351
126 310
120 247
17%
-5%
Sonatel
18 301 170
22 419 376
26 346 949
23%
18%
fixed line
56
r
2013/2012 r
2014/2013
annual report of activities Sonatel 2014
sustained development of mobile subscriber base
2012
2013
2014
Senegal
7 118 160
7 462 438
8 097 673
5%
9%
Mali
8 581 888
10 821 677
12 825 680
26%
19%
Guinee
1 850 059
3 239 141
4 506 012
75%
39%
Bissau
360 950
476 747
513 031
32%
8%
17 911 057
22 000 003
25 942 396
23%
18%
total
2013/2012
r
r
subscribers per country
2014/2013
31.2%
Senegal
2% 17.4%
Bissau
49.4%
base
(thousands)
more than million subscribers
26
12 826 10 822 8 582 7 118
8 098
7 462
4 506
3 239 1 850 282
361
2012 fixe
mobile Senegal
293
477
2013 mobile Mali
513
284
mobile Guinea
2014 mobile Bissau
Guinea
Mali
turnover breakdown per activity contribution & evolution in 2014 evolution 2014/2013
30%
internet 5%
25% 20% liaison louées et autres
15%
mobile 66%
10% data & leased line internet 1%
5% -0% -5% -10% -15%
fixe line 5%
international interconnexion 19% domestic interconnexion 3%
other wholesale 2%
-20%
group margins remained at high levels
53%
52%
51%
52%
37%
38%
37%
39%
24%
26%
26%
27%
2011
2012
2013
2014
net margin
58
operating margin
Ebitda margin
annual report of activities Sonatel 2014
sustained investment to
17% of turnover
135
capex
xpansion and densification in e 2G and 3G network in Guinea (128 sites) and Guinea Bissau (57 websites)
120
118
2011
2012
116
development of mobile internet improving the quality of technical service and innovation
2013
2014
good cash generation and low leverage (in Xof billion) 2011
2012
2013
2014
equity
592
596
613
655
debt
40
26
15
3
6.8%
4.4%
2.4%
0.5%
debt ratio
26
40
2011
2012 equity
655
613
596
592
15
2013 debt
3
2014
good cash generation and low leverage (next) 2011
2012
2013
2014
free cash flow
215
229
263
292
debt
40
26
15
3
14.4%
9.5%
5.1%
0.9%
debt ratio
229
215
40
26
2011
292
263
2012 free cash flow
3
15
2013
2014
debt
creation of wealth : driving force of economical development
a key contributor to the economies of the countries of presence
60
billion XoF from Senegal, 107 billion XoF from Mali, about 46 billion XoF from Guinea and near 6 billion XoF from Bissau
more than 100
billion XoF in turnover generated for the benefit of local companies,
more than 132
billion XoF from Senegal, 35 billion XoF from Mali, 46 billion Xof from Guinea and 5 billion XoF from Bissau
early 173 biln lion XoF were generated in contribution to the states balance of payments trough our international activities with foreign operators of telecommunications
000 indirect jobs thanks to a wide commercial distribution network and dynamic partners,
more than 3,000 direct jobs
Job creation
more than 215
more than 218
Private sector contribution
States budget revenues
billion XoF paid for taxes, fees, royalties, payroll taxes, customs fees and dividends of which
net exports of more exports
more than 374
than 98 billion XoF from Senegal, 72 billion XoF from Mali,19 billion XoF from Guinea and 10 billion XoF from Bissau
annual report of activities Sonatel 2014
staff
2011
2012
2013
2014
1 910
1 933
1 787
1 751
-8%
-2%
Mali
431
450
487
530
8%
9%
Guinea
170
217
275
324
27%
18%
Bissau
54
63
39
85
10%
23%
2 565
2 663
2 618
2 690
-1.7%
3%
Senegal
total
2013/2012
r
record value of Sonatel share : continuing performance
r
2014/2013
25 000
Fcfa
during the 1 trimester st
peak of the month
monthly average stock price
25 000
interim results
24 000
dividend 2013
23 000 22 000 21 000
14 c.de
4 v.1 no
14 t.oc
13 p.se
14 g.-
-14 jun
4 y-1 ma
4 r.-1 ap
r-1 4 ma
4 .-1 feb
4 .-1 jan
22 500
-14
+
au
-2 300 Fcfa
19 000 25 000
cfa
0F
0 27
jul.
20 000
stock split
20 000 17 500 15 000
0 Fcfa
+9 00
12 500 Ju l.au 12 g-1 se p.- 2 oc 12 t.1 no 2 v de .-12 c.jan 12 . feb -13 .-1 ma 3 r.-1 ap 3 r. ma -13 y-1 jun 3 .jul. 13 .-1 au 3 g. se -13 p.oc 13 t.1 no 3 v.de 13 c.jan 13 . feb -14 .-1 ma 4 r.-1 ap 4 r. ma -14 y-1 jun 4 .-1 jul. 4 au -14 g. se -14 p.oc 13 t.1 no 4 v.de 14 c.14
10 000
Share price record in closing at 24,600 CfaF
generous and reliable dividend policy
exercices
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
share price
3 603
6 701,5
9 100
17 500
13 000
12 000
15 400
12 000
14 500
20 050
22 800
dividends
56.5
69
88.3
110
130
135
140
145
150
155
160
net dividend per share
508.5
621
794.7
990
1 170
1 125
1 260
1 305
1 350
1 395
1 440
dividend yield
14%
9%
9%
6%
9%
10%
8%
11%
9%
7%
7%
distribution rate (%)
69%
59%
60%
68%
83%
73%
76%
94%
88%
82%
93%
(in billion cfaF)
62
>
annual report of activities Sonatel 2014
chiffres clés
financial report 2014
note to the readers The scope of consolidation of Sonatel group includes Sonatel SA and its subsidiaries: • Sonatel SA, the parent company, • Sonatel Mobiles, a 100 percent subsidiary, under Senegalese law, • Orange Mali, a subsidiary of 70.0467 percent of Malian law, • Sonatel Multimedia, a 100 percent subsidiary, under Senegalese law, • Sonatel Business Solutions, a 100 percent subsidiary, under Senegalese law, • Orange Conakry, 89.3704 percent subsidiary of Guinean law, • Orange Bissau, a 90 percent subsidiary of Guinea-Bissau law. The 2014 consolidated financial data of Sonatel group are discussed in the text.
introduction The Sonatel group recorded in 2014, a double-digit growth and was able to confirm his leadership and good operational and financial results in all countries of presence through innovation, operational excellence, business momentum and maintaining a sustained level of investment. This performance was helped by the improvement in the economic environment and the gradual normalization of the political situation in Mali and the Republic of Guinea. However, regulatory, tax and competitive pressures were higher than in 2013 and had bumps effects on growth, particularly in Senegal and Mali. The fiscal year 2014 Sonatel was marked by:
operational excellence and contribution of the international subsidiaries in the growth • group operating income grows up by 78 billion XOF thanks to the recovery in Mali (+ 41.40 billion XOF), • remarkable performance in Guinea (+ 41.39 billion XOF) due to the consolidation of leadership on the volume market share to 50.6 percent, • Maintaining of the turnover contribution of Guinea Bissau (+ 1.25 billion XOF) due to the strong business momentum, • Senegal’s contribution slightly decreased (- 6.33 billion XOF) impacted by the residual effects of fraud on incoming international calls, lower interconnection rates by 36 percent and the beginning of implementation of the reduction of the Government’ bills.
the continued growth of mobile subscribers’ base reached more than 26 million • Substantial recruitment in Guinea and Mali are sustaining the growth of the mobile subscribers’ base in 2014, • In Mali, the bonus program and the promotions’ activation served as main drivers to the increase of the subscribers’ base, • Growth of the subscribers’ base is 3 times higher than 2013 in Senegal limited by the extension of subscribers’ identification, • A dynamic commercial service in regions and in new localities covered in Senegal, Guinea and Guinea Bissau,
63
Sonatel 2014 annual report of activities
• The further penetration in rural areas combined with the decline in the volume of cancellations in the residential segment attenuate the decrease of fixed-lines subscribers’ base despite a slight slowdown to + 18 percent or - 4.8 point compared to the evolution of 2013 (+ 22.8 percent between 2013 and 2012), • A slowdown in growth of the subscribers’ base in Guinea Bissau due to the regulatory measures for identifying operators’ subscribers, • An ADSL subscribers’ base is declining (- 7 percent) due to the cannibalization of mobile internet deals around the use of 3G and still timid adherence to the new fixed-lines rates
Sustained financial performance The turnover growth remained at a level above 10 percent despite the emergence of unexpected and adverse external factors: decision to reduce the Government of Senegal’s phone bills and fraud incoming calls. The group was able at the same time to improve its EBITDA margin by + 1.2 point of 52.4 percent, thanks to the control of operating costs contained at 47 percent of the variation in turnover. EBITDA increases at 50 billion XOF and reached 427.8 billion XOF, or + 13.1 percent of XOF compared to 2013.
Turnover 738
816
663
4.4%
11.4%
10.5%
2012
2013
2014
turnover
663
738
816
10.5%
11,4%
Ebitda
347
378
428
13.1%
8.9%
Ebitda margin
52%
51%
52%
+1pt
-1pt
operating result
251
273
316
15.5%
9%
operating margin
38%
37%
39%
+2pts
-1pt
net income
171
190
218
15.1%
10.7%
net margin
26%
26%
27%
+1pt
-
capex
118
116
135
17.2%
-2.2%
capex rate
18%
16%
17%
+1pt
-2pts
free cash flow
229
263
292
11.3%
14.5%
r
14/13
13/12
r
in xof billion
64
annual report of activities Sonatel 2014
1. Economic and regulatory environment
E
conomically, a slight improvement in environment accompanied by a stabilization of the political situation in Mali and Guinea
1.1 environmental stabilization Senegal On the macroeconomic side, we note: • an internal environment more suitable for business thanks to - the start of the implementation of Senegal Emergent Plan - the consolidation of sub-regional trade (economic recovery in Mali) beneficial to the Senegalese economy, • uncertainties in the agricultural sub-sector: observed delay in the installation of the rainy season in 2014 in most areas of the country, • economic forecast showing a marked increase compared to 2013 as a result of the renewed dynamism in industry and services, • a real GDP growth rate is expected to be more than 4% in 2014 against 3.5% for 2013. The telecommunications sector is characterized by: • Intensification of the competition, mainly on mobile offers (voice and data), resulting in the development of multisim which strongly impacted the ARPU (- 9% on mobile voice), • A decrease in wholesale components under the effect of a decrease of 36 percent of call termination rates on mobile (from 23.4 to 15 XOF) and the inclination of international activity with an increase in scale of the cannibalization of our revenues by Over The Top (OTT) actors facilitated by the development of broadband networks and the democratization of smartphones, • Lower rental capacities on the international following the demand reduction induced by the availability of capacity via the new submarine cable ACE, • The willingness of the Government to intervene in the sector while demanding more contribution of operators in turnovers (Contan project - establishment of the special tax PST), combined with its cap decision of its telephone expenses to 11 billion XOF.
Mali The gradual normalization of the political situation with: • the resumption of negotiations with the armed groups in northern Mali, • the start of the country’s economic recovery with GDP growth expected,
• concerns raised following the aid suspension from the World Bank, freeze up in December with the resumption of cooperation with Mali, • threat of the epidemic «Ebola» but with little effect on the economy. The telecommunications sector was marked in the mobile market by: • pursuing the struggle for leadership of the subscribers’ base: promotions and activations • a high rate of multi equipment and churn, • apace bonus promotions based on events, • continued expansion and intensification of the 3G network in Bamako to strengthen the leadership in mobile data, • on the corporate market, the resumption of growth in the subscribers’ base following the reopening of bank branches with VPN offers • and a decline in fixed-lines subscribers following the market withdrawal of Duba offer.
Guinea The year 2014 was quite politically stable unlike 2013 marked by many manifestations and socio-political events. The events that have marked the Guinea’s environment were as follows: • parliament session made earlier this year followed by large investments plans, and • appearance of Ebola fever in late March with serious consequences on the economic and social level. Orange Guinea has maintained its leadership acquired since May 2013 thanks to a strong performance on recruitment supported by a network deployment program (187 sites open in 2014 with 128 new locations) and animations organized at the opening of new locations.
Guinea Bissau The country recorded the positive impacts following the lifting of economic sanctions resulting notably in the progressive resolution of the social crisis of the first semester of 2014 and the settlement of salary arrears of civil servants (4 months). Other notable developments include: • the entry into force of a tax reform with the main point of the VAT rate down from 15 to 17 percent, • the deficit on the production factors (water, electricity,..) posing a handicap for a good control of service quality, • a large campaign to identify subscribers initiated by the Government under the supervision of the Regulator Authority with a major impact on the evolution of the number of active subscribers of both operators.
65
Sonatel 2014 annual report of activities
1.2 Sonatel group, a shared wealth creator The group continues to remain a key player in the creation of wealth in all countries of presence. It contributes to the development of the countries through: •b udget turnovers: more than 374 billion XOF paid by way of taxes, fees, social security contributions, customs duties and dividends including more than 215 billion in Senegal, more than 107 billion in Mali, 46 billion in Guinea, and 6 billion for Bissau, •d evelopment of the private sector: more than 218 billion XOF of turnover generated for the benefit of local businesses, including more than 132 billion turnover for enterprises in Senegal and 35 billion in Mali, 46 billion XOF in Guinea and 5 billion in Guinea Bissau, • job creation: 100 000 indirect jobs through a wide and dynamic commercial distribution partners and 3,000 direct jobs, •e xports: nearly 173 billion XOF generated contribution to the balance of payments by foreign telecommunications operators; net exports of services by nearly 98 billion by Senegal, 72 billion XOF by Mali, 19 billion by Guinea and 10 billion by Bissau, •S ponsorship actions in the fields of Culture, Education and Health Foundation of Orange Mali and Sonatel in Senegal, which celebrated its 10 years of existence since 2012.
2. Operational elements 2.1 Subscribers’ base: 26.3 million customers, representing 17.5 percent growth
I
n late 2014, the Sonatel Group subscribers’ base (fixed-lines, mobile and internet) surpassed 26,300,000 subscribers, an increase of 17.5 percent over 2013.
The mobile subscribers’ base are driving growth of the subscribers’ base with a significant increase of almost 4 million subscribers (+ 18 percent compared to 2013) driven by the significant recruitments mainly in Guinea (+ 1.27 million subscribers) and in Mali (+ 2 million subscribers). Senegal has managed to triple the growth of the mobile subscribers’ base (+ 655,000 subscribers), the hiring pace achieved during the second semester of 2013 had been slowed by the implementation of regulatory measures to identify subscribers. These same measures relating to the identification of subscribers in Bissau have slowed the pace of recruitment in 2014. Thus, the leadership was consolidated in Guinea, the subscribers’ base gap from the leader was reduced in Bissau, the competitor offensive contained in Senegal and Mali. The ADSL subscribers’ base has decreased by 6.5 percent compared to 2013, explained by a slowdown in recruitment due to 3G mobile competition and volume of terminations more than the recruitment on new fixedlines deals (home and home plus).
2012
2013
2014
281 762
293 063
284 306
4%
-3%
mobile
17 911 057
22 000 003
25 942 396
23%
18%
internet
108 351
126 310
120 247
17%
-5%
18 301 170
22 419 376
26 346 949
23%
18%
fixed line
total
66
r
2013/2012
r
2014/2013
annual report of activities Sonatel 2014
12 828 subscribers per country
31.2%
Senegal
2% 17.4%
Bissau
10 822
(thousands of subscribers)
8 582 7 118
8 098
7 462
Guinea
4 506
3 239 1 850
49.4%
Mali
282
361
293
477
2013
2012 fixed line
mobile Senegal
mobile Mali
mobile Guinea
The subscribers’ base by country is analyzed as follows:
Senegal mobile Compared to 2013, the mobile subscribers’ base grew by 635,235 subscribers, a significant jump in base growth (+ 8.5 percent against + 4.8 percent in 2013). The acquisition campaigns (Nio far, Ganalé region, Noflay), the strengthening of recruitment «Kirène with Orange» and the mastery of outputs deployed through retention campaigns have tripled in volume growth recorded in the subscribers’ base in 2013. The subscribers’ base knows in stride an increase of 10 percent compared to 2013 and stabilized at around 74 percent of prepaid active customers (+ 8 million subscribers). fixed-lines / Internet The fixed-lines subscribers’ base felt by 3 percent and that of the ADSL down by - 6.5 percent compared to 2013 impacted by the development of mobile data offers on the 3 G amplified by the popularization of smartphones and resale of retail mobile internet (internet pass from 100 XOF). Commercial offers headlights (illiminet, Kheweul,) and dual play packages (voice + adsl), as the continued penetration of Cdma (Yakhanal) in rural areas still can welcome new subscribers on the fixed-lines.
Mali
513
284
2014
mobile Guinea Bissau
This strong growth, achieved in a very competitive environment is due to the many promotions on sim activations and the market animation for recharging with an acceleration of the frequency and levels of bonuses offered. fixed-lines / Internet The growth of fixed-lines subscribers’ base in Mali has been affected by the withdrawal from the market of the offer Duba, object of dispute with the Regulator. On the other side, 25 percent growth was recorded in the Internet compared to 2013 thanks to new offerings «Flybox», «Sénékela», «mobile internet package for others» and reopening of bank branches for VPN offers.
Guinea mobile Orange Guinea Subscribers’ base in late 2014 stood at 4.5 million against 3.2 million subscribers in 2013. We note a remarkable increase of + 39.1 percent compared to 2013 thanks to continued investment efforts for network densification and coverage of new localities (187 sites deployed with 128 new localities covered in 2014, 164 3G sites opened), the recovery of the quality of technical service accompanied by strong sales of conquest. Orange Guinea holds 50.6 percent market share volume at end-2014 and 53 percent market share value, consolidating its leading position in the Guinean market in both volume and value.
mobile The mobile Subscribers’ base Orange Mali amounted to 12.8 million subscribers, up + 18.5 percent, an increase of recruitment (+ 2 million subscribers).
67
Sonatel 2014 annual report of activities
Guinea Bissau mobile Orange Bissau base reached 513,000 subscribers at the end of 2014 against 477,000 subscribers at the end of 2013, an increase of 7.6 percent. This growth resulted on the maintenance of commercial dynamics and development of the usage favored by commercial animation and abundance deals There is a strengthening of the Orange market position with 0.9 points won market share.
2.2 traffic: evolution of in-coming and out-going national mobile traffic, international traffic by country.
outgoing national mobile traffic
outgoing national mobile traffic 9128
4248
4901
305
243
207
2012
2013
2014
2144
1659
1998
222
214
253
961 377
2012
2013
2014
2012
1723
3110
372
369
2013
2014
outgoing national mobile traffic 170 19
2012
266
396
16
15
2013
2014
other operators
Orange
international traffic
international traffic
international traffic
international traffic
859
837
332
361
344
499 206
241
533 233
144 85
174 116
172 136
22 20
27 33
31 47
2012
2013
2014
2012
2013
2014
2012
2013
2014
2012
2013
2014
791
outgoing from Senegal
590
2012
610
2013
535
incoming international traffic
incoming national mobile traffic 589
2014
incoming national mobile traffic
68
outgoing national mobile traffic
incoming national mobile traffic
365
364
399
2012
2013
2014
incoming national mobile traffic
incoming national mobile traffic
299
301
319
13
16
24
2012
2013
2014
2012
2013
2014
annual report of activities Sonatel 2014
mobile Senegal The mobile out-going traffic totaled 9,335 million minutes and was up sharply by 81.5 percent compared to 2013. Traffic growth, driven mainly by the use of voice on prepaid refills, is the result of the resurgence of promotional actions, almost daily on prepaid (flash promotion, unlimited days and nights, unlimited bonus numbers). Most of the mobile outgoing traffic (94 percent) is made to Orange mobiles (club effect).
due to the residual effects of SIM box fraud and the development of alternative channels (VoIP).
The exponential growth of outgoing traffic (+ 4,191 million minutes) confirms the de-correlation increasingly pronounced with mobile turnovers (+ 2.5 percent), or 32 times less than the increase in usage.
This evolution of outgoing traffic (+ 7.2 percent) is in phase with the recorded increase in the subscribers’ base (2 million) and the increase in the level of free calls.
The increase in monthly prepaid average usage per user (aupu) from 59.1 to 100.2 minutes per month, or + 69 percent, takes place at the same time as a decrease of 6 percent of the out-going mobile prepaid ARPU (average revenue per user), from 3,069 à 2,734 XOF per month, reflecting the decline in value caused by the development of abundance.
fixe-line Senegal The fixed-lines outgoing traffic totaled 267.7 million minutes at the end of 2014, down by 10.8 percent in 2013 (- 32 million minutes). The decline in the fixed-lines outgoing traffic is mainly due to the overall decline of the outgoing traffic to almost all destinations (except for servers) with more than 2/3 of the national fixed-lines under the effect of the continued gradual transfer of use of voice to mobile. The traffic evolutions by destination were as follows: • National outgoing traffic (local + long distance), down - 12.9 percent or - 3.1 million minutes, • Mobile outgoing traffic decreased by - 7.7 percent or 14.6 million minutes, • Outgoing international traffic (origin Senegal) declined slightly by - 4.8 percent or - 17.4 million minutes. The change of the mix subscribers’ base for packaged solutions mainly ADSL usage, reinforces the refocusing phenomenon of the fixed-lines usage, especially for new subscribers, mainly on broadband. Further, the convergence of rates of fixed-lines and mobile services in the Orange network promotes the indiscriminate usage of fixed-lines or mobile for calls within the Orange network representing over 80 percent of traffic. International incoming traffic with 791 million minutes experienced a decline of 5.5 percent, or 46 million minutes. This decrease in international incoming traffic is
Mali At the end of 2014, outgoing traffic from Orange Mali is 2,619 million minutes, representing an absolute increase of 175.4 million minutes compared to 2013.
The national incoming traffic (third party mobile operators) is experiencing a significant increase of 24.3 percent due to the strong growth of the competitor subscribers’ base (+ 2.2 million) and volumes exchanged between subscribers of both operators due to the development of off-net promotions. International incoming traffic from Orange Mali experienced a slight increase of 0.9 percent, or 4.6 million minutes compared to 2013.
Guinea Overall traffic of Orange Guinea strongly grew with an increase of 63.4 percent (+1,402.8 million minutes) for outgoing traffic compared to 2013 and by 5 percent (16.5 million minutes) on the incoming traffic compared to late 2013. The evolution of outgoing traffic was mainly driven by outgoing traffic to Orange network (club effect) whose variation is +98 percent (1,386.5 minutes) of the variation in the total outgoing traffic. The strong increase in traffic is the result of the combined effects of the strong growth of the subscribers’ base (+ 1.2 million subscribers), improved service quality and further expansion of network coverage to new areas.
Guinea Bissau The outgoing traffic experienced a sharp increase between 2013 and 2014 with growth of + 42 percent, or 131.8 million minutes. It is mainly driven by the development of the subscribers’ base, the development of abundant causing an increase in traffic to Orange mobiles by + 48 percent, or 129.5 million minutes, regularly linked with unlimited offers made to customers during weekends.
69
Sonatel 2014 annual report of activities
Furthermore, the positive development of refills (+ 10 percent growth in turnover for the mobile business) results in an increase of usage with a direct impact on the development of traffic. The incoming traffic rose 42.7 percent of the 49.2 million minutes in 2013 to 70.2 million minutes in 2014. This growth was driven both by the international incoming traffic, which rose from 33.1 million to 46.5 million minutes of national traffic minutes which rose from 16.1 million to 23.6 million minutes.
2.3 Average revenue per user (ARPU) A decline in prepaid ARPU was noted in all countries resulting induced effects of increased largest subscribers’ base that changes in income recorded over the period.
average monthly arpu
The change noted on the ARPU is due to: • The over-abundance proposed on the markets leading to lower average prices of usages, • The still low contribution of income growth drivers (mobile data, Orange Money, content, TV) • The decline in revenue from voice • The impact of lower termination rates on mobile calls in Senegal. Also, abundance, main lever on recruitment and preservation of value market share, explains the decline in ARPU in Senegal from 9.3 percent to 2,784 XOF / month, in Mali from 3.6 percent to 1,778 XOF a month, in Guinea from 13 percent to 2,583 XOF per month and in Bissau from 4.4 percent to 3,024 XOF per month.
croissance du parc
2012
2013
2014
fixe
93 890
100 549
102 245
7%
2%
-3%
mobile prepaid
3 326
3 069
2 784
-8%
-9%
9%
Mali (cfaF)
mobile prepaid
2 118
1 844
1 778
-13%
-4%
19%
Guinea (Gnf)
mobile prepaid
43 923
39 962
34 652
-9%
13.3%
39%
Guinea Bissau (cfaF)
mobile prepaid
3 056
3 162
3 024
3%
-4.4%
8%
Senegal (cfaF)
r
13/12
r
14/13
2.4 staffing In late 2014, the staff of Sonatel group stood at 2,690 officers, an increase of 3 percent compared to end 2013. By entity, the workforce is distributed as follows: • Senegal: 1,751 employees, down 36 because of early retirement and pensions. • Orange Mali: 530 employees, or + 43 employees because of the recruitments to fill particular needs in technical structures due to the increased activity. • Orange Guinea: 324 employees, an increase in the number of 58 employees integrated for better management of business development, • Orange Bissau: 85 employees, an increase in the number of 16 employees to support the development of the activity. 2011
2012
2013
2014
1 910
1 933
1 787
1 751
-8%
-2%
Orange Mali
431
450
487
530
8%
9%
Orange Guinea
170
217
275
324
27%
18%
Orange Bissau
54
63
69
85
10%
23%
2 565
2 663
2 618
2690
-1.7%
3%
Senegal
Sonatel
70
r
13/12
r
14/13
annual report of activities Sonatel 2014
3. Financial Results 3.1 Turnover: growth of 10.5 percent The year 2014 recorded a significant level of turnover growth of +10.5 percent compared to 2013. This maintaining of a double digit growth remains an important performance in the context of increased competition and widespread abundance on the market. It represents an additional 78 billion in turnover driven by: • Mobile + 77.3 billion due to the growth of the subscribers’ base and the increase of usages to which (70 billion in Mali and Guinea Conakry) • Internet and leased data links +7.5 billion mainly in Guinea (+ 5.7 billion) and Mali (+ 1.9 billion) through the revitalization of public offers (key dominoes, flybox) and redesign of business deals,
However, there is a decrease in • Wholesale turnover (- 6.7 billion XOF) carried by Senegal, following the drop in interconnection rates from 23 to 15 XOF, • Reselling capacity on leased lines following the setting ACE service, • International incoming volumes (- 3.6 percent) due to the residual effects of the SIM box fraud and the development of alternative routes, • The Government which begins his bill reduction process. The mobile business in Mali, Guinea and Senegal had driving the growth in the group.
In 2014, Turnover by country divided as follows: Guinea Bissau 15
• Senegal
52%
• Mali
32%
• Guinea
14%
Guinea 116
Mali 261
Senegal 425
• Guinea Bissau 2%
in xof billion
71
Sonatel 2014 annual report of activities
Senegal The social turnover in Senegal stands at 458.8 billion XOF. It is stable compared to 2013. In contribution, the turnover is 425 billion in 2014, a decrease of 1.4 percent and 6.1 billion in absolute value compared to 2013. The decrease in revenues recorded covers the three main components of wholesale: domestic interconnection (-3.6 billion), the international incoming traffic (-6.5 billion), leased lines and roaming for (-1.9 billion). The mobile generates 59.6 percent of Senegal’s turnover to grow by 2.5 percent, or 6.2 billion compared to 2013. mobile The mobile business represents 59.6 percent of Senegal’s turnover and amounted to 253.2 billion XOF, a slight growth of 2.5 percent compared to 2013 (6.2 billion XOF). This growth was driven by refills (+ 5.2 billion), turnover of equipment (+ 0.8 billion Makossa policy around low cost smartphones), Orange Money income due to increased transaction volumes around the bill payment and merchant payment (+ 1.1 billion). Postpaid revenues are down by 0.8 billion (effect of Government’s bill reduction, the flat-rate data, and corporate market offers). The growth of prepaid refills (+ 5.2 billion) is explained by the increase in subscribers’ base recharger of 490,000 subscribers compared to 2013, stabilized at 74 percent of the active subscribers’ base through actions on the inactive base, animations supported around promotions and campaigns targeted, and to a lesser extent on the tariff revision carried out in the second semester on tariffs for outgoing national calls. international wholesale Turnover from international activities amounted to 87.9 billion XOF down 6.9 percent, or 6.5 billion XOF compared to 2013. This decrease in revenue was due to the decline in incoming net traffics falling to 7 billion resulting in the
72
decline in volumes of 48 million minutes following the effects of SIM box fraud and the development of alternative channels (Voip). The decrease in incoming international turnover was slightly offset by the increase of 0.5 billion of hubbing revenues related to increased volumes received. fixed-lines Fixed-lines activities contribute for 8.7 percent to the turnover in Senegal, nearly 40 billion XOF, decreasing 0.5 billion or -1.3 percent compared to 2013, due to a hand moving of usage toward the mobile and also following the implementation of the beginning of the government’s bill reduction convention. internet and data Turnover in Senegal amounted to 26.3 billion XOF and contributes 6.2 percent of revenues. It is stable compared to 2013. The slight increase in revenues of the Internet (+ 0.2 billion) explained by migration on new formulas home and home plus, is offset by a decrease of 0.2 billion recorded on data and integration. domestic interconnection Revenues from domestic interconnection in Senegal are 8.83 billion in 2014, down 3.8 billion or - 30.4 percent compared to 2013 following the downward revision of call termination rates on mobile by the Regulator of - 36 percent ( from 23.4 XOF to 15 XOF). Other wholesale revenues (leased lines, roaming operators) Other income in the wholesale recorded a decrease of 1.7 billion compared to 2013. This decrease results from the decrease in revenues from leased lines of 1.9 billion explained by the reduction in demand (subscriptions terminations) and prices (abundant offer) of resale capacity with the commissioning of the ACE cable service.
annual report of activities Sonatel 2014
Senegal
300 000 200 000 100 000 fixed line
mobile
internet
domestic interconnection
international interconnection
other wholesale (internet & data)
Mali
international interconnection
The social turnover of Orange Mali amounted to 271.8 billion XOF. It grew by + 18.9 percent over 2013.
International interconnection activity represents 22.5 percent of contributory earnings Orange Mali (59 billion). She recorded an increase of 2.1 percent, or 1.2 billion XOF compared to 2013, related to an increase in rates.
For contribution, Mali’s turnover amounted to 261 billion in 2014, representing growth of 19 percent (+ 41.4 billion). The Mali increases its contribution of 2.7 points compared to 2013, mainly due to mobile business (+ 37.3 billion), internet and data (+ 2.3 billion) and wholesale (+ 1.7 billion). mobile Revenues for the Mobile division contribute to 70 percent to turnover (182 billion), up by 26 percent compared to 2013. This growth was driven by the significant evolution of the mobile subscribers’ base (+2 million registered subscribers), combined with the rapid pace of bonus promotions and activation, to the continued expansion and densification of the 3G network, particularly the development of Orange Money activity (increase in turnover of 5 billion compared to 2013)
domestic interconnection Revenues from domestic interconnection totaled 6.8 billion in December 2014, thus an increase of 0.6 billion compared to 2013, driven by higher volumes received from competitors + 27 million minutes. fixed-lines, internet and data Turnover rose by 2.4 billion, including 0.1 billion XOF thanks to the success of business deals and VPN services following the reopening of the banking agencies after the crisis.
200 000
Mali
150 000 100 000 50 000 0 fixed line
mobile
internet
domestic interconnection
international interconnection
other wholesale (internet & data)
73
Sonatel 2014 annual report of activities
Guinea The social turnover of Orange Guinea amounted to 122.3 billion, up 56.5 percent over 2013. In contribution, Guinea turnover totaled 115.6 billion XOF, an increase of 55.8 percent (+ 41.4 billion), or + 17 points compared to 2013. Growth was driven by the mobile business (+ 33 billion), internet and data (+ 5 billion) and international interconnection (+ 2 billion), the national interconnection (+ 0.6 billion XOF) and the roaming including leased lines (+ 0.5 billion). mobile With a turnover of 89 billion, the mobile business is contributing by 77 percent of Orange Guinea revenue. Activity revenue is up by 58 percent, or + 33 billion compared to 2013 due to the significant increase in the subscribers’ base (+ 39 percent or 1.3 million subscribers compared to 2013) in pursuit of the refill incentives actions with the expansion of network coverage (187 sites with 128 new locations) and the improvement of the quality of service.
internet and data This turnover amounted to 8 billion and represents 7 percent of Orange Guinea contributed turnover. Internet leased lines and VPN offers are experiencing a strong growth compared to 2013 (+ 5.2 billion) thanks to the launch of key dominoes and the redesign of business deals. international wholesale With a turnover of 12 billion in 2014, international interconnection recorded a growth of 24 percent or + 2.4 billion compared to 2013 due to higher termination rates for calls from $ 0.28 to $ 0.325. However, traffic was down by -1.2 percent or -2 million minutes impacted by the SIM box fraud. Other wholesale revenues (leased lines, operator roaming) Other wholesale revenue amounted to 1 billion and recorded a growth of 0.5 billion primarily on operator roaming. domestic interconnection Turnover from domestic interconnection totaled 5.1 billion in December 2014, an increase of 0.6 billion compared to 2013, in correlation with the increase in volumes received from competitors + 6 percent (+18.5 million minutes).
Guinea 100 000 80 000 60 000 40 000 0
74
fixed line
mobile
internet
domestic interconnection
international interconnection
other wholesale (internet & data)
annual report of activities Sonatel 2014
Guinea Bissau The social turnover of Orange Bissau amounted to 19.7 billion XOF, up + 13 percent compared to 2013. For contribution, Bissau’s turnover amounted to 15 billion, an increase of 9.4 percent (+ 1.3 billion), driven primarily by the mobile and domestic interconnection. mobile The turnover of the mobile business amounted to 12 billion, contributing to 86 percent of Orange Bissau’s turnover.
The activity grows by 10 percent (+ 1.2 billion) compared to 2013, thanks to increased refills supported by the increase in usage (network coverage expansion and improvement of quality of service), further animation efforts and refills incitements (promotion «Tico Tico») domestic interconnection Revenues from domestic interconnection amounted to 935 million and were up by 0.2 billion compared to 2013 due to the significant increase in volumes received from competitors + 47 percent (+ 7 million minutes) in 2014.
15 000
Guinea Bissau
10 000 50 000 0 fixed line
mobile
internet
domestic interconnection
international interconnection
other wholesale (internet & data)
3.2 Operating expenses 2014 operating expenses of the Sonatel Group amounted to 530.9 billion, up by 45.1 billion (+ 9.3 percent) compared to 2013. Most of this increase was driven by Mali to 47.3 percent (+ 21.3 billion), Guinea for 30 percent (+ 13.6 billion), Senegal for 21 percent (+ 9.4 billion) and Bissau for 1.8 percent (+ 0.8 billion). The cost structure remains dominated by network charges and depreciation amount with respective contributions of 36 percent and 21 percent. Network expenses amounted to 193 billion and were up by 12.3 billion. This growth is explained by higher expenses from Guinea to 5.4 billion, from Senegal for 4.1 billion and from Mali for 2.8 billion.
Evolution by type of expense is as follows: Network access charges and payments to operators fell by 4.1 billion driven by Senegal for 5.5 billion, by Mali for 0.3 billion and Bissau for 0.2 billion while they increase to 1.9 billion in Guinea. In Senegal, this decrease is justified by: • A declining of 4.3 billion on the national interconnection due to a decrease of interconnection rates (from 23 XOF to 15 XOF with Tigo and from 32 XOF to 15 XOF with Expresso) for 2 billion on repayments of value-added service with the limited success of SMS games, for 1.2 billion on rentals of circuits following the renegotiation of VSAT contracts (Very Small Aperture Terminal) and for 0.5 billion on roaming, mitigated by the increase • 2.5 billion in international payouts explained by the growth of volumes of incoming hubbing of 26 million minutes and diversion until May of the Orange Zone offer
75
Sonatel 2014 annual report of activities
In Mali, the decrease was explained by lower international payouts of 0.9 billion related to the decline in outgoing traffic volumes by 7.8 percent (impact of the initiation of the Mobile Termination Charge billing - Orange Zone), offset by increases respective of 0.4 and 0.2 billion of the roaming and the national payouts.
In Senegal, the increase is from mainly distributors’ commissions for 2 billion (of which + 1 billion of the Orange Money commissions, + 0.8 billion on media voice and game servers payoffs, 0.2 billion on sales force proxy, and costs of terminal and other equipment sold for 1.7 billion and advertising expenses to 0.9 billion.
In Bissau, the decrease of 0.2 billion was mainly driven by international payouts.
In Mali, the growth is mainly due to distributors’ commissions for 3.1 billion in correlation with the increase in refills and Orange Money turnover for 29.4 billion, including 4.7 billion on Orange Money, advertising expenses for 1.7 billion offset by the decrease of 0.5 billion on the costs of handsets and other equipment sold.
In Guinea, the increase is due to the growth of national termination charges of 1 billion resulting from the 59 percent increase in domestic traffic, rental of circuits for 0.6 billion with the establishment of two additional links and international terminals 0.3 billion due to the growth of international traffic to 17 percent. Rental expenses and network fees: increased by 10.5 billion of which 7.6 in Senegal, 1.4 in Mali, 1.3 in Guinea and 0.2 in Bissau. In Senegal, the Special Levy on the Telecommunications sector (PST), the recall on the accounting of the 3G license fee and the SU fee explain this growth. The developments in Mali, Guinea Conakry and Guinea Bissau are on the frequency fees and universal service in correlation with the growth of the business. The network energy expenses rise by 2.4 billion in Guinea and in Mali respectively by 1.3 and 1.1 billion due to the opening of new sites (+195 in Guinea and +126 in Mali). The increase in other network expenses and IT expenses of 3.6 billion is supported by: • Senegal for 2.1 billion primarily related to the outsourcing for 904 million, maintenance of service platforms for 0.7 billion, purchases of integration materials for 578 million and IT infrastructure and applications maintenance for 555 million; These increases were partially offset by the decrease of 346 million on submarine cables maintenance and 306 million on other networks maintenance • Guinea for 0.9 billion with the increase of switching and transmission equipment maintenance and that of submarine cables to support the growing business, • Mali for 0.6 billion on the lines and networks equipment maintenance (0.8 billion) and the IT system maintenance for 0.2 billion offset by the decrease of 0.4 billion on transmission supplies purchases. Commercial expenses : amounted to 45.6 billion, an increase of 9 billion compared to 2013. Senegal’s contribution to this increase was 4.7 billion, Mali 4.3 billion and 0.3 billion in Bissau; there was a decline of 0.3 billion for Guinea.
76
The growth of expenses in Bissau covers on the advertising expenses and the purchase of subscribers’ terminals for sale. The decrease in Guinea is mainly due to the economy recorded on mobile card purchases in connection with the development of virtual refills. External expenses (54.5 billion) increased by 9.6 billion, driven by Mali (+ 8.1 billion), Guinea (+ 1.1 billion) and Senegal (+ 0.3 billion). This evolution is mainly due to the increase: • 8.4 billion in taxes • 1.8 billion in fees including 1 billion in Mali and 0.8 billion in Guinea Conakry in correlation with the growth of turnover, • 0.3 billion on grants and donations including 0.2 billion in Senegal. This increase was offset by a decrease of 0.8 billion XOF in postage fees in Senegal through the invoice dematerialization project. Operating expenses 28 billion: increased by 3.6 billion mainly in Guinea Conakry (1.6 billion), Senegal (1.2 billion) and Mali (+0.7 billion). Related to the cost structure, evolution is as follows: Real estate and logistics costs have increased by 1.4 billion, for 1.1 billion for Guinea and for Mali 0.3 billion related to security costs and office rentals related to the opening of new commercial and technical sites.
annual report of activities Sonatel 2014
The fees are up by 0.8 billion, driven mainly by Senegal for 0.9 billion because of expert missions, studies and audits carried out this year and by Guinea for 0.1 billion on call centers royalties related on the subscribers’ base growth offset by the decrease in Mali of 0.2 billion on fees paid to other experts. The costs of missions and receptions evolve of 0.5 billion primarily in Mali and Senegal.
In social, the rate of EBITDA from Senegal was down 0.7 points, or 46.5 percent in 2014 against 47.2 percent in 2013. The EBITDA margin of Orange Mali is also experiencing a decrease of 1.4 points, 53.2 percent against 54.6 percent in 2013.
Training costs increased by 0.4 billion (0.3 billion in Senegal and 0.1 billion in Mali).
The margin of Orange Guinea rose 11.6 points, or 50.7 percent against 39.2 percent and that of Orange Guinea Bissau by 1.2 points, or 38 percent in 2014 against 36.8 percent in 2013.
Operating water and energy also increase to 0.4 billion driven by the 0.3 billion in Mali and 0.1 billion in Guinea.
The group EBITDA grew by 13.1 percent compared to last year (+ 49.7 billion).
Personnel expenses totaled 76.9 billion, up 8.8 billion of which 4.1 billion in Senegal, 2.7 billion in Mali and 2 billion in Guinea..
The growth seen in EBITDA is mainly explained by: • increased 78 billion in turnover driven mainly by Mali (+ 41.4 billion of 90 percent of the mobile business), by Guinea (+ 41.4 billion of 79 percent of the mobile business) and by Bissau (+ 1.3 billion, of which more than 93 percent on the mobile); these performances noted in the international subsidiaries helped offset the decline recorded in Senegal: - 6.1 billion focusing on international and domestic interconnection, leased lines. • Growth 9.6 billion of other products including: • 10.6 billion on Senegal mainly due to reversals of provisions for retirement of 2.9 billion, the compensation from Miga of the destruction in northern Mali for 2.6 billion, the rebilling expenses and reversals of expenses for 2.5 billion, the reversal of provisions for 2.3 billion, and on receivables and inventory for 0.3 billion. • 0.6 billion in Guinea mainly from the reversal of the provision for customs fines of 500 million made in February 2014, • to offset the increase in operating expenses of 37.9 billion of which 19 billion in Mali, 10 billion in Guinea, 8.4 billion in Senegal and 0.5 billion in Guinea Bissau.
In Senegal, higher expenses are mainly from the exceptional bonus of 4.3 billion, the special premium for retirement of 2.1 billion with sliding retirements of December 2013 for 2014, the yield premium for 0.8 billion and the remuneration of agency staff and catering for 0.6 billion. These increases were offset by the decrease of 3.7 billion over the function ending allowances. In Mali, the increase was due to 1.2 billion for the exceptional bonus provision, the wages for 0.8 billion due to the growth of the workforce (+ 43 agents) and 0.3 billion in payroll taxes. In Guinea Conakry, the increase was due to 1.2 billion on teams building expenses for better activity management, annual salary increases and 0.8 billion for the exceptional bonus provision. The increase in depreciation (+ 7.208 million) was mainly due to accelerated depreciation of equipment replaced in Guinea and in Senegal with the renewal project of the mobile access network and for the further expansion of 2G and 3G densification in Mali. The decrease in depreciation and provisions of 4.487 million is explained by the revision of the pension provision in 2013 and the constitution of provisions for litigation.
3.3 EBITDA maintained above 50 percent Consolidated EBITDA amounted to 427. 8 billion XOF in 2014, representing an EBITDA rate of 52.4 percent, up 1.2 points compared to 2013.
Senegal, with an EBITDA of 200.3 billion sees its contribution to the group EBITDA declining by 7.2 points from 54 percent to 46.8 percent. This decline in the Senegal contribution benefits Mali and Guinea whom reinforce their contributions with respective EBITDA of 151.9 billion and 68.7 billion corresponding to the respective contributions of 35.5 percent and 16.1 percent against 34.7 percent and 9.7 percent in 2013. Guinea Bissau with an EBITDA of 6.9 billion maintains its contribution at 1.6 percent.
77
Sonatel 2014 annual report of activities
3.4 operating income
3.5 financial income
Consolidated operating income amounted to 315. 95 billion, up by 42.5 billion (+ 15.5 percent) compared to 2013 due to the increase of 49.7 billion in EBITDA partially offset by higher expenses on depreciation of 7.2 billion.
Consolidated financial result of the Group is 3.6 billion, up by 3.8 billion from 2013.
For contribution, the results are as follows: • The Senegal has an operating profit of 144 billion, down by 5 billion (- 3.3 percent) mainly from the decrease of 3.9 billion of the combined EBITDA, to the increase of 1.1 billion in depreciation; the operating margin was down 1 point compared to 2013 (34 percent against 35 percent), • The Orange Mali Operating income amounted to 118 billion, an increase of 18.7 percent (+ 18.6 billion) compared to 2013, following a growth of 16 percent (+ 20.9 billion) of EBITDA offset by increased depreciation of 2.3 billion. • Orange Conakry recorded an operating profit of 50.3 billion, up by 28.5 billion (+ 130.1 percent) due to the increase in EBITDA (+ 32 billion), while depreciation increased by 3.5 billion; Orange Guinea multiplies its operating income by 2.3 times compared to 2013. • Orange Bissau operating income is 3.5 billion, it increased by 0.4 billion compared to 2013.
78
The decrease in financial expenses of 2.5 billion at the end of the medium-term loan contracted in 2009 combined with the growth of financial products (+ 0.6 billion mainly on the reversals of provisions, foreign exchange difference and other payables + 0.3 billion on investment income) allows the achievement of this outcome.
3.6 income excluding ordinary activities It stood at 226 million XOF.
3.7 net income Consolidated net profit amounted to 218.2 billion, up by 15.1 percent, or + 28.6 billion compared to 2013, thanks to the results of Orange Guinea (+ 20 billion), Orange Mali (+ 10.1 billion) and Orange Guinea Bissau (+ 0.2 billion). The rate of net profit margin increased from 25.7 percent to 26.7 percent.
annual report of activities Sonatel 2014
4. Investments Investments made in 2014 by the Sonatel Group amounted to 135.3 billion, or 17 percent of realized turnover. They increased by 19.8 billion, up 17.1 percent over 2013. Investments made by Senegal represent 37.1 percent of the total, or 50.2 billion, Mali 32.2 percent, or 43.5 billion, Guinea 26.5 percent, or 35.9 billion and Bissau 4.2 percent, or 5.7 billion. (in xof billion)
total capex rate
Senegal’s investment level remained stable compared to 2013. However, the subsidiaries recorded a strong growth (+ 54 percent in Guinea, + 46.8 percent in Bissau and + 15.9 percent in Mali).
2012
2013
2014
2014-2013
r 14/13
r 13/12
Senegal network others
48 35 13
51 36 15
50 41 9
-1 +5 -6
-1% 14% -38%
6% 2% 15%
Mali network others
44 39 6
38 33 5
44 40 4
+6 +7 -1
16% 22% -24%
-16% -16% -15%
Guinea network others
21 20 1
23 22 2
36 34 2
+13 +12 -
54% 58% 5%
8% 7% 30%
Bissau network others
4 3 1
4 3 1
6 5 1
+2 +2 -
47% 56% -12%
-2% 11% -43%
118 18%
116 16%
135 17%
+19
17% +1pt
-2% -2pts
Senegal Senegal network investments representing 82 percent of total budget, increased by 5 billion (+ 13.9 percent) compared to 2013. The mobile network polarizes almost half (49 percent) of the amounts invested in 2014, with the remainder split between the fixed-lines network (29.3 percent), network data and internet (13.7 percent) and energy (8.1 percent). The various projects have helped to further our primary objectives: • Ran the Renewal projects, LTE and Service Quality Plan Energy and Environment helped accelerate the deployment of 3G radio sites, improving the quality of service, including the densification of the 2G network with the modernization with equipment of latest generation and the deployment of 4G pilot sites. • Rural extension and regulatory compliance (covering main roads axes following the regulator campaign in 2013).
• The broadband projects and the data center with the aim of stabilizing the quality of data and voice network services, • Improving the Backhauling capacity (transmission network and links between the core of the network) and the collection rate of the Node B (base station).
fixed-lines network The various fixed-lines network projects have been allocated in the following areas: Access Network: the accomplishments of an amount of 1.8 billion largely concerning the expansion, the rehabilitation of wired access network and the serving of new subdivisions. The achievements have focused on: • Moving wire works to address the risk of network downtime caused by cable cuts due to the execution of road works, • Wired rehabilitation focused on the resumption of transmission and distribution cables, replacement of broken heads, renewal of dilapidated booths and underground development of long overhead cables,
79
Sonatel 2014 annual report of activities
• The satisfaction of demand for broadband and IPTV customers by serving new subdivisions in Dakar and the regional capitals. transmission: these projects implemented at the level of 2.4 billion were mainly concerning the interconnection with Orange Mali, transmission securing, obsolescence management and FH extension (microwave link, transmission extension). The achievements have permitted, inter alia, the implementation of the new transmission network, thus avoiding saturation loops SDH (synchronous digital hierarchy north, center and south). collection: these projects executed in the amount of 6 billion concern the project FH Ran Renewal (2.6 billion XOF), the fiber collection (2.2 billion XOF), obsolescence management and secure broadband (818 million XOF) and VSAT hub extension (139 million XOF). other projects: the achievements amounting to 1.5 billion are related to the data center and the acquisition of land for the site sharing. switching: the projects implemented at a level of 168 million relate to the following of the program in 2014 CSN with the refloating of spares CSN MA lots.
mobile networks The investments devoted to mobile amounted to 24.2 billion, down slightly from 589 million (- 2.4 percent). They concern: the access network (58 percent) or 14 billion including: • 11.7 billion for the ran renewal, • 333 million for the 3G program • 2.1 billion for the improvement of quality of service and rural extension in 2014. core network (25.9 percent) or 6.3 billion including: • 3.195 billion realized on the security of transmission (national backbone and submarine cables), through densification of 2G in 2014 • 397 million XOF to the mobile switching, • 652 million on services platforms, 1.5 billion on tools and 461 million for TTM projects; other network projects (10.5 percent) or 2.5 billion including: • 1.1 billion for LTE project • 1.4 billion for the core network in 2014. • Energy: 6 percent or 1.141 billion
data and Internet
80
Achievements of 3 billion in the following areas: • IP network: 421 million for the extension and securing of the IP network. • Service platforms, OSS, TTM: 2.5 billion on fixed-lines concerning the new IPTV platform and the expansion of IPTV network head. Energy and environment The achievements in this area amounted to 2 billion and were down by 465 million compared to 2013. They have permitted to ensure continuous and permanent supply of primary energy on strategic sites, to reduce by half the risk of service disruption and contribute to the NUR improvement by reducing the proportion related to energy and the environment. They focused on the upgrade of batteries life, the renewal of generators’ park, AES, inverters, obsolete and out-of-service inverters, the extension and securing of the energetic environment, to optimize the multiservice collection and support migration toward the transmission over IP (desaturation of SDH loops). investments outside networks in Senegal have reached 9 billion XOF, of which 4.1 billion XOF for land acquisition and construction of buildings (following up of the new headquarters project), 3.1 billion XOF for IT projects and nearly 2 billion XOF on other investments outside networks. Compared to 2013, the projects carried out in the field outside networks are down by 5.6 billion XOF.
Mali Mali has spent 39.7 billion XOF to its investments in the network domain, or 91 percent of the amount of its investments. They focused again mainly on the 3G program with the densification of 3G in Bamako to strengthen leadership in mobile data, core network, transmission and energy. They were used to finance network expansion in all its components: • Core network: 9 billion XOF for the extension of switching equipment, intelligent network and Gprs services and value added • Network access: 5.4 billion XOF for the acquisition of BSC, BTS and sites construction; • Transmission: 8.4 billion XOF for the acquisition of FH for rural program, Vsat stations and optical fiber, • Energy: 7 billion XOF for solar sites, batteries and generators. • Information system: 1.4 billion XOF invested in the purchase of servers and office equipment, • Other investments include the purchase of vehicles, office furniture and layout of commercial spaces.
annual report of activities Sonatel 2014
Guinea
Guinea Bissau
In its dynamic development of new locations, Orange Guinea has invested 34 billion XOF in 2014 in the network domain, which is 12.5 billion more than in 2013. These investments are mainly devoted to energy for 6 billion XOF (12.4 percent of increase compared to 2013), the building of sites for 6.2 billion XOF (13.9 percent increase compared to 2013) and core network for 4.7 billion XOF.
Bissau network investments amounted to 5.3 billion XOF and focused on:
The mobile access network also occupies an important part with 11 billion of achievements or 8 billion XOF more compared to 2013. The following achievements were made in the following areas: • mobile access network: BTS acquisition (launch of 195 new sites for full coverage of the 303 sub-prefectures in 2G), a new BSC, an MGW, • 3G devices: whom have covered 33 prefectures and make the necessary densification to meet the strong growth in data traffic, • Core network: IN extension and PCRF project being finalized, the acquisition of MSC) as well as various services on the core network, the upgrade of the core packet and integration to MSC3, the MVAS and extension of HLR subscribers’ licenses • Transmission: securing the loop and the purchase of 10 routers, • site construction: acquisition of 98 pylons and dismantling of some pylons in urban areas for their redeployment in the regions, • Energy: acquisition of 98 generators, solar energy workshops and tanks for deployment, purchase of 20 generators to replace old and compliance and strategic sites and QoWiso project.
transmission and site construction pour 3.8 milliards Fcfa : for 3.8 billion XOF: • Acquisition of 45 3G + sites, deployed in Bissau and in the regional capitals, • BTS acquisitions, pylons, FH-PDH bonds for the densification program and networks extension in 12 new 2G sites in Bissau and the regions, • 15 upgrades and 11 swaps bonds in Bissau and regions, • FH installations in 10 clients in 12 BTS. Energy for 1.3 billion XOF invested in: • Supplies, battery installations and generators for the 2014 program (12 sites) • Solar system in 33 sites in Bissau and regions, • The acquisition of two mobile generators, • Swap of two electricity generators in Bissau and in Gabu. Outside network investments of 473 million XOF were used to: • purchase of four plots in the regions and completion of the building for the call center and restaurant staff, • the acquisition of furniture, office equipment and computer, • the purchase of three vehicles primarily for technical and business needs.
Off-network projects were: • the development of new agencies, including that of Kaloum, new receptions and works in new buildings, • Projects Information Systems (Project backup and virtualization).
81
Sonatel 2014 annual report of activities
annual report of activities Sonatel 2014
LES ANNEXES
>
financial statements
83
Sonatel 2014 annual report of activities
audit of financial statements: asset (in millions Xof) asset
gross
amort/prov
31/12/14
31/12/13
17
7
fixed assets fixed charges intangible assets
17 159 924
131 406
28 519
33 979
0
0
0
0
159 924
131 406
28 519
33 979
1 378 369
848 009
530 360
495 764
0
0
0
0
financial assets
131 864
899
130 966
123 928
differed taxes
13 529
0
13 529
13 206
equity affiliates
0
0
0
0
7 436
583
6 853
6 468
110 900
316
110 584
104 254
1 670 176
980 314
689 862
653 678
inventory
16 847
520
16 327
18 460
receivables and assimilated functions
214 227
26 594
187 634
188 966
receivables
131 931
26 342
105 589
103 036
other receivables
82 296
252
82 044
85 930
total (II)
231 074
27 114
203 960
207 426
assets-cashflow
224 073
0
224 073
180 521
total fixed assets
2 125 323
1 007 428
1 117 894
1 041 625
goodwill other intangible assets tangible assets advances and installments paid on fixed assets
participations and linked debts loans and other financials assets total (I) current assets
84
annual report of activities Sonatel 2014
audit of financial statements: liability (in millions Xof)
liability
31/12/14
31/12/13
equity
50 000
50 000
additionnal paid-in capital and consolidated reserves
347 742
337 010
2 249
-832
191 991
168 329
0
0
part of consolidated company
591 982
554 506
minorities share
63 038
58 902
equity of total consolidated (A)
655 020
613 408
239
239
loans and financials debts
2 922
15 426
financial provisions for contingencies and charges
42 346
40 661
total (B)
45 508
56 326
total stable equity flows
700 528
669 734
accounts payables and related accounts
182 606
151 355
other debts
207 489
166 534
total (II)
390 095
317 889
27 271
54 002
1 117 894
1 041 625
equity
conversion variance net result (part of consolidated company ) other equity
financial debts and assimilated resources differed taxes
current liabilities
liabilities-cash flow total liabilities
total (III)
85
Sonatel 2014 annual report of activities
audit of financial statements: consolidated income statement (in millions Xof)
consolidated income statement
31-dec-14
31-dec-13
816 019
738 314
0
0
immobilized production
2 288
2 361
other operating income
17 400
9 578
I - production of the year
835 707
750 253
consumed purchases
52 444
50 242
external services and other consumptions
280 122
248 753
II - consumption of the year
332 566
298 995
value added of the activities
503 142
451 258
staff costs
76 908
68 084
gross operating profit (gop)
426 234
383 174
depreciation and provisions
121 466
118 742
reversals of provisions
11 182
9 036
operating profit
315 949
273 468
financial revenues
8 900
7 290
financial expenses
5 308
7 514
319 541
273 244
226
-3 913
result before tax
319 768
269 331
tax due on result
103 408
89 331
1 855
9 635
218 215
189 635
0
0
net result of the consolidated companies
218 215
189 635
minorities share
26 224
21 306
part of consolidated company
191 991
168 329
turnover stocked production
ordinary activities result o.o.a. result
differed tax net result of integrated company share in net income of equity affiliates iequity-accounted investments companies
86
annual report of activities Sonatel 2014
financial table of resources and funds : tafire 1
(in millions Xof)
1st part: determination of financial balances for fiscal year 2014 global cash-flow (GCF) amount (Xof million)
amount (Xof million) EBE
(SA) financial fees
2 309
(SC) exchange rate loss
2 207
(SL) expenses outside ordinary activities
1
426 234
(TT) operating expenses transfer
3 342
(UA) Financial income
5 534
(UE) Financial expenses transfer (SQ) participation (SR) income tax
total (I) GCF: Total(II) - Total(I)
0 103 408
107 925
1
(UC) Exchange rate profit
2 096
(UL) Outside regular activities products
0
(UN) Outside regular activities expense transfer
0
total (II)
437 207
329 282
financing from cash flow (a.f.) dividends distributed during the fiscal year
177 681
AF= GCF – dividends distribution during the fiscal year
151 601
working capital need changes (n.w.c.) change N.W.C.= inventory change + debt changes + notes payable changes uses (increase +)
resources (decrease -)
(BC) goods
0
0
(BD) raw materiel and other stocks
0
2 250
(BE) in-progress
0
0
(BF) manufactured products
0
0
(A) global net change in stock
0
2 250
stock change n -(n-1)
87
Sonatel 2014 annual report of activities
financial table of resources and funds : tafire 1 (next) (in millions Xof)
1st part: determination of financial balances for fiscal year 2013 (next) changes in receivables
uses (increase +)
resources (decrease -)
suppliers, paid advances
0
362
17 171
0
other receivables
0
11 723
conversion variance - Asset
0
2 084
total
17 171
14 169
(B) global net change in receivables
3 003
0
uses (increase +)
resources (decrease -)
customers, received advances
0
1 218
operating suppliers
0
35 020
tax liabilities
0
28 055
social liabilities
0
1 680
other liabilities
910
0
0
1 533
137
0
1 047
67 506
(C) global net change in debt
0
66 459
change in NWC=A+B- C
0
65 706
2014
2013
E.B.E.
426 234
383 174
- changes in NWC
65 706
38 586
- self constructed assets
-2 288
-2 361
489 652
419 399
customers
changes in debt
conversion variance - liabilities contingency provisioned total
operating cash surplus (OCS) OCS = GOP – NWC CHANGES – Self constructed assets
O.C.S
88
annual report of activities Sonatel 2014
financial table of resources and funds : tafire 2
(in millions Xof)
2nd part: determination of financial balances for fiscal year 2013 fiscal year 2014 use
resources
fiscal year 2013 U-;R+
I- investments and disinvestments fixed charges (increase during the period)
0
0
internal growth purchases/transfers of intangible assets
3 991
0
-5 263
purchases/Transfers of tangible assets
131 506
187
-105 934
purchases/transfers of financial assets
25 280
19 413
-47 558
investissement total
141 178
0
-158 756
0
65 706
38 586
75 472
0
-120 170
0
9 535
6 769
external growth
II- changes in operation working capital need A- economic uses to be financed FF+FG III- uses/resources (B.F.; H.A.O.) IV - restrained financial uses
22 670
-14 919
reimbursement (based on payment schedule) of loans and nancial debt and financial debt B- total uses to be financed
88 608
0
-128 319
177 681
329 282
125 277
increase in equity by new contribution
0
0
investments from grants
0
0
V- internal financing dividends (uses) / CAFG (resources) VI- equity financing
equity withdrawals
0
0
89
Sonatel 2014 annual report of activities
financial table of resources and funds : tafire 2 (next) (in millions Xof)
2nd part: determination of financial balances for fiscal year 2013 (next) fiscal year 2014
fiscal year 2013
use
resources
U-;R+
loans
0
297
1 523
other financial liabilities
0
6 992
4 237
C - net financing ressources
0
158 890
131 038
D - excess or shortage of resourcesfunding (C-B)
0
70 282
2 719
at the end of the period + or -
196 802
0
-126 519
at the beginning of the period + or -
126 519
0
-123 800
cash changes ( + use ; - resources )
70 282
0
-2 719
VII- financing by new loans
VIII - cash variation net cash
use 12/31/2014
resources 12/31/2013
4 958
0
0
75 241
cash change (T) T(N)-T(N-1)
70 282
0
total
75 241
75 241
control (based on N and N-1 balance sheet volumes) working capital change (WC): WC(N) - WC(N-1) NWC change: NWC(N) -NWC(N-1)
90
annual report of activities Sonatel 2014
audit of financial statements: table of changes in equity (in millions Xof)
capital social initial balance before distribution
other
emission d’actions distribution in kind
cash contribution
incorporated reserves
decrease
increase
decrease
conversion variance
account to account Transfer
final balance after distribution
equity
50 000
issuance, merger, contribution premium
3 577
re-evaluation variance
-832
legal reserve
18 162
18 162
statutory and contractual reserves
0
0
other reserves carried over balance previous year result not yet allocated
50 000
244
3 822
3 082
354 540
903
-1 673
0 0
-70
2 249
6 247
361 689
2 626
884
0
0
result of the year
189 635
investment grants
0
0
regulated provisions
0
0
0
0
total
613 408
218 215
0
0
0
0
219 118
-177 681
-177 681
-11 955
175
0
218 215
655 020
91
Sonatel 2014 annual report of activities
audit of financial statements: table of changes and consolidated debts details (in million Xof)
balance beginning of year (1)
incurred debt (2)
loans and debts credit institutions
10 018
123
9 005
10
various financial loans and debts
5 408
7 166
13 609
2 812
0
1 777
total
15 426
7 289
22 614
2 822
0
2 922
payments incorporated (3) to equity (4)
net conversion variance (5)
other movments (6)
balance end of year (7)
convertible bonds debts other bonds debts
0
1 145
off-balance sheet financial commitments commitments given
received
(1)
(1)
secured commitment with real collaterals other security commitments mutual commitments in terms of Leasing definite orders
92
1 211 4 055
3 864
collateral of secured debts
annual report of activities Sonatel 2014
consolidated financial statements: turnover breakdown table (in million Xof)
2014 fiscal year
2013 fiscal year
total sales
% of turnover
total sales
% of turnover
fixed lines
36 048
4,42%
35 754
4,84%
mobile lines
535 349
65,60%
460 631
62,39%
publi-phony
639
0,08%
774
0,10%
interntaional interconnexion
161 636
19,81%
166 501
22,55%
ADSL
13 493
1,65%
13 254
1,80%
specialized links
15 280
1,87%
14 838
2,01%
806
0,10%
535
0,07%
internet
17 925
2,20%
10 464
1,42%
national Interconnexion
32 533
3,99%
31 985
4,33%
various products
0
0,00%
0
0,00%
other accessories
2 310
0,28%
3 578
0,48%
816 019
100%
738 314
100%
Africa ( ECOWAS)
543 417
66,59%
496 659
67,27%
Africa ( outside ECOWAS)
115 742
14,18%
83 109
11,26%
Asia
1 486
0,18%
1 345
0,18%
America
14 119
1,73%
14 529
1,97%
Europe
141 254
17,31%
142 671
19,32%
816 019
100%
738 314
100%
A) sales allocation by activity
fixed terminal sales / Peri-telephony
total
B) sales allocations by geographic areas
total
93
Sonatel 2014 annual report of activities
audit of financial statements: Workforce Analysis by key categories as of 31 december (in XOF millions)
fiscal year 2014
94
fiscal year 2013
workforce
payroll
workforce
payroll
staff under payroll
2 690
69 950
2 676
61 934
managers and seniors executives
1 083
32 227
1 014
26 861
middle managers
1 042
26 379
1 072
24 293
foremen
506
9 915
515
9 116
employees and workers
59
1 429
75
1 664
staff available for the company
41
2 344
46
2 455
temporary staff
1 073
4 614
1 033
3 696
total
3 804
76 908
3 755
68 084
annual report of activities Sonatel 2014
Sonatel SA balance sheet : summarized assets (in XOF millions)
fiscal year 2014 asset
gross
depreciation/ provisions
fiscal year 2013 net
net
0 0 0
0 0 0
fixed assets (1) fixed charges set-up costs and deferred charges bond redemption premium
0 0 0
intangible assets research and development charges
33 837 13
30 205 13
3 632 1
4 151 1
patents, licences and software goodwill other intangible assets
33 823 0 0
30 192 0 0
3 632 0 0
4 151 0 0
tangible assets land buildings
496 277 3 636 36 564
390 068 0 16 504
106 209 3 636 20 060
101 614 3 611 17 124
installations and fittings equipment transportation equipment
14 940 430 320 10 817
11 055 355 382 7 128
3 884 74 938 3 689
3 859 73 701 3 318
0
0
0
0
182 388 68 175 114 212
878 583 295
181 510 67 593 113 917
190 561 67 593 122 969
291 351
296 326
advances and installements paid on fixed assets financial assets equity securities other financial assets total fixed assets (I)
712 501
421 151
current asset o.o.a. current assets inventories goods raw materials and other supplies in progress made products receivables and assimilated receivables suppliers, advances paid accounts recievables other receivables total current assets (II) assets - cash flow marketable securities checks, bills awaiting collection bank, postal checks, cash on hand total assets- cash flow (III) conversion variance - assets (IV) (probable exchange loss) general total (I + II + III + IV)
0
0
0
0
3 329 0 3 329 0 0
96 0 96 0 0
3 233 0 3 233 0 0
5 416 0 5 416 0 0
235 926 5 391 135 586 94 949
10 522 0 10 296 225
225 404 5 391 125 289 94 723
230 821 5 570 114 540 110 711
228 637
236 237
9 361 98 123 453
3 711 94 94 334
132 912
98 139
242
93
653 141
630 795
239 254 9 361 98 123 453 132 912
10 618 0 0 0 0
242 1 084 910
431 769
95
Sonatel 2014 annual report of activities
Sonatel SA balance sheet : summarized liabilities (in XOF millions)
LIABILITIES (Before allocation)
fiscal year 2014
fiscal year 2013
capital shareholders, uncalledd capital
50 000 0
50 000 0
premium and reserves share, issuance, merger premium re-evaluation variance unavailable reserves free reserves carried forward balance net income for the period (gain +, loss -_)
163 558 0 0 10 000 153 558 0 173 666
171 045 0 0 10 000 161 045 0 147 513
other equity investment grants regulated provisions and assimilated funds
2 038 1 241 798
2 188 1 390 798
389 262
370 746
1 146 0 60 38 832
9 909 0 39 37 345
total financial debts (II)
40 038
47 292
total secured resources (I + II)
429 300
418 038
6 217 877 59 200 72 216 9 423 61 048 242
7 848 1 368 48 661 54 712 9 742 60 291 93
209 224
182 715
0 0 14 440
0 25 134 4 907
14 440
30 041
177
1
653 141
630 795
capital and assimilated resources
total equity (I) financial debts and assimilated resources loans lease liabilities and assimilated contracts various financial debts risk and expenses provisions
cuurent liabilities o.o.a. debts and assimilated resources clients, received advances trade suppliers tax debts social debts other debts provisioned risks total current liabilities (III) liabilities - cash flow bank, discount credit bank, cash credit bank, overdraft total liabilities - cash flow (IV) conversion variance - liabilities (V) (probable exchange gain) general total (I + II + III +IV+ V)
96
annual report of activities Sonatel 2014
Sonatel SA income statement summary (in XOF millions)
works, sold services self-constructed assets accessory products turnover operating grants
fiscal year 2014
fiscal year 2013
325 532
316 086
1 450
1 500
30 110
30 306
355 643
346 392
0
0
other revenues
7 896
4 120
other purchases
9 160
9 684
inventory change
1 651
253
857
1 528
external services
121 804
119 788
tax and duties
11 290
10 482
other expenses
4 697
6 225
value added
215 530
204 053
staff costs
56 501
52 434
ebitda
159 029
151 619
provision recovery
7 286
3 759
expenses transfers
3 648
2 809
total operating revenues
375 924
358 580
provision and depreciation
29 301
33 188
operating result
140 662
124 999
financial expenses
1 377
1 714
exchange rate loss
443
308
provision and depreciation
275
713
total financial expenses
2 095
2 736
financial revenues
78 676
65 882
exchange rate gain
967
94
provision recovery
692
212
expenses transfers
0
0
total financial revenues
80 336
66 188
financial result
78 241
63 453
total ordinary activities revenues
456 260
424 768
transportation
97
Sonatel 2014 annual report of activities
Sonatel SA income statement summary (next) (in XOF millions)
fiscal year 2014 result from ordinary activities
2013
218 903
188 452
accounting values of fixed assets transfer
81
238
o.o.a. expenses
1
114
o.o.a. provisions
0
0
total o.o.a. expenses
83
352
revenues from fixed assets
165
230
o.o.a. revenues
0
0
o.o.a. transfers
149
166
expenses transfer
0
0
total o.o.a. revenues
315
396
o.o.a. result
232
44
0
0
45 470
40 982
general total of revenues
456 575
425 164
net result
173 666
147 513
workers’ participation income tax
98
fiscal year
annual report of activities Sonatel 2014
Sonatel SA supply and use table (tafire) (in XOF millions)
part 1: determination of financial balances for fiscal year 2014 GLOBAL CASH FLOW (G.C.F.) G.C.F. = GOP - Remaining disbursable expenses + Remaining collectable revenues GOP (SA) financial fees
1 377
(SC) exchange rate loss
159 029
TT) operating expenses transfer
3 648
(UA) financial income
78 676
443
(SL) expenses outside ordinary activities
1
(SQ) participation
0
(UE) financial expenses transfer
0
(UC) exchange rate profit (SR) income tax
45 470
total ( I )
47 291
G.C.F. = Total (II) - Total (I) =
967
(UL) outside regular activities products
0
(UN) outside regular activities expense transfer
0
Total ( II )
242 320
195 029
financing from cash flow (A.F.) dividends distributed during the fiscal year
155 000
AF= CAFG – dividends distribution during the fiscal year (1)
40 029
working capital need changes (W.C.N) Change in WCN
= Inventory change + debt changes + notes payable changes
inventory changes : N-(N-1)
Uses Increases (+)
Ressources Decreases ( - )
(BC) goods
0
0
(BD) raw materials
0
2 183
(BE) in-process
0
0
(BF) made products
0
0
(A) global net changes in inventory
0
2 183
(1) dividends paid during the fiscal year including dividends’ advances. (2) excluding O.O.A. elements.
99
Sonatel 2014 annual report of activities
Sonatel SA supply and use table (tafire) (in XOF millions)
part 1: determination of financial balances for fiscal year 2014 (next) Changes in receivables: N - (N - 1) (BH) suppliers, paid advances (BI) clients (BJ) other receivables (BU) conversion variance – assets (B) net global changes in receivables
Uses Increases (+)
Ressources Decreases (-)
0
178
10 749
0
0
15 987
149
0
-5 268
Uses Decrease (-)
Ressources Increase (+)
491
0
(DJ) operating suppliers
0
10 539
(DK) tax liabilities
0
17 504
(DL) social liabilities
319
0
(DM) other Liabilities
0
758
(DN) provisioned risks
0
149
(DV) conversion variance - Liabilities
0
175
changes in current liabilities: N - (N-1) (DI) clients, received advances
(C) net global change in current liabilities
change in W.C.N.= (A)+(B)+(C)
0
0
28 316
35 766
operating cash surplus (O.C.S.) fiscal year 2014
100
fiscal year 2013
operating margin surplus
159 029
151 619
- change in W.C.N.(- if uses ; + if resources) (- or +)
35 766
30 678
- self constructed assets
-1 450
-1 500
operating cash surplus
193 344
180 798
annual report of activities Sonatel 2014
Sonatel SA supply and use table (tafire 2) (in XOF millions)
part 2: supply and use table (tafire) fiscal year 2014
uses
fiscal year 2013
ressources
(U - ; R +)
I. investments and disinvestments fixed costs (increase during the year)
0
0
internal growth purchases/transfers of intangible asset
967
0
-2 249
purchases/ transfers of tangible assets
23 717
165
-20 112
purchases / transfers of financial assets
19 427
28 897
-28 205
total investments
15 050
0
-50 565
II. change in operating financial need (cf. supra: Var. B.F.E.)
0
35 766
30 678
A - economic uses to be financed (FF + FG)
0
20 717
-19 887
III. used/resources (B.F. , H.A.O.)
1 631
0
384
IV. restrained (1) financial uses
8 933
external growth
-14 718
loans and financial liabailities repayment (according to timetable) (1) except for anticipated repayments done in VII B - total uses to be financed
0
10 153
-34 222
101
Sonatel 2014 annual report of activities
part 2: Sonatel SA supply and use table (tafire) (in XOF millions)
fiscal year 2014
fiscal year 2013
uses
ressources
(U -; R +)
155 000
195 029
27 286
capital increase with new contributions
0
0
investment grants
0
39
V. internal financing dividends (uses)/ C.A.F.G.(resources) VI. equity capital financing
deduction on capital (Including operator’s withdraws)
0
0
VII. new loans financing loans (2)
0
191
340
other financial debts (2)
0
0
0
C - net financing resources
0
40 220
27 665
D - surplus or insufficiency of financial resources (c-b)
0
50 373
-6 557
50 373
0
-6 557
other financial debts (2)
VIII. changes in cash position net cash position at the end of year + ou -
118 472
at the beginning of year + ou -
68 098
changes in cash position: + if uses; -if resources
control: D = VIII with opposite sign I, IV, V, VI, VII: n terms of flow; II,III,VIII: balance sheet differences control (based on N and N-1 balance sheets volumes)
uses
ressources
change in working capital (W.C.) : WC(N) – WC(N-1)
0
16 238
change in global W.C.N. (G.W.C.N) : GWCN(N) - GWCN(N-1)
0
34 135
50 373
0
50 373
50 373
change in cash position (T): T(N) - T(N-1) total
102
annual report of activities Sonatel 2014
Sonatel SA financial statements (in XOF millions)
table n° 1 : fixed assets change as of 31/ 12/2014 balance as of 31/12/13
purchases
reclassification
retirement
balance as of 31/12/14
stock exchange entry expenses
0
0
0
0
0
fixed expenses
0
0
0
0
0
fixed assets purchases expenses
0
0
0
0
0
fixed costs
0
0
0
0
0
studies and research
13
0
0
0
13
patents and licences
1 551
0
162
0
1 713
computer software
18 115
0
1 298
0
19 413
switching software
3 154
0
0
0
3 154
transmission software
4 070
0
443
0
4 513
network and data software
2 890
0
933
0
3 823
1
0
0
0
1
456
12
-68
0
399
1 315
955
-1 461
0
809
0
0
0
0
0
intangible assets
31 562
967
1 307
0
33 836
vacant lands
2 728
0
30
0
2 758
lands
763
0
0
0
763
buildings allocated to technical sites
108
0
0
0
108
land development
0
0
0
0
0
land planning in process
11
21
-26
0
6
lands
3 611
21
4
0
3 636
industrial buildings
6 377
0
0
0
6 377
administrative and commercial buildings
5 679
0
37
0
5 716
buildings, administrative fixed assets
6 883
0
0
0
6 883
buildings assigned to technical sites
1 844
0
0
0
1 844
buildings allocated to housing
1 111
0
0
0
1 111
trails & routes
133
0
0
0
133
other infrastructure works
439
0
0
0
439
3 556
0
0
0
3 556
42
0
0
0
42
other adjustments, arrangements and installations
10 428
0
723
31
11 119
buildings in process
10 398
4 240
-580
0
14 059
arrangements, office installation in process
0
0
0
0
0
infrastructure works in process
0
0
0
0
0
177
46
0
0
222
47 068
4 286
181
32
51 502
labels
research and development expenses patents & licenses in process software in process other rights and intangible values in process
general office facilities office equipment
adjustments, installations in process technical facilities, buildings and arrangements
103
Sonatel 2014 annual report of activities
table n° 1: Sonatel SA fixed assets change (next) (in XOF millions)
fixed assets change as of 31/ 12/2014 balance as of 31/12/13
purchases
reclassification
retirement
balance as of 31/12/14
sonatel switching equipment
36 474
0
114
0
36 589
public switching equipment
0
0
0
0
0
transmission equipment
133 184
0
1 206
9
134 382
network access equipment
34 275
0
1 969
15
36 229
lines & public network equipment
127 893
0
405
0
128 298
394
0
0
0
394
energy equipment
40 785
0
825
29
41 581
devises
3 166
0
37
0
3 204
access network equipment
0
0
0
0
0
other operating equipment
36
0
0
0
36
376 207
0
4 557
52
380 713
office equipment
2 246
0
18
19
2 245
technical computer equipment
10 195
0
326
0
10 521
office computer equipment
4 450
0
391
109
4 732
office equipment
2 361
0
35
5
2 390
housing equipment
6
0
0
0
6
housing furniture
5
0
0
0
5
equipment and furniture
19 263
0
769
133
19 899
light vehicles
9 966
0
1 482
1 561
9 887
heavy vehicles
159
0
27
0
186
motocyles
164
0
6
3
167
transportation materiel
10 288
0
1 515
1 563
10 240
other fixed assets
2 955
0
99
1
3 053
other fixed assets
2 956
0
99
1
3 053
labels
sonatel lines and network equipment
operating equipment
104
annual report of activities Sonatel 2014
table n° 1: Sonatel SA fixed assets change (end) (in XOF millions)
fixed assets change as of 31/ 12/2014 balance as of 31/12/13
purchases
reclassification
retirement
balance as of 31/12/14
operating equipment in process
82
-4
0
0
79
public switching equipment in process
313
172
-115
0
371
1
0
0
0
1
2 846
5 057
-1 604
0
6 298
4
-4
0
0
0
lines & public network equipment in process
577
0
-404
0
173
lines & public network equipment in proces
0
0
0
0
0
giga switch and ip routers in process
0
0
0
0
0
energy equipment in process
2 870
2 685
-883
0
4 673
service plateform materials in process
1 108
1 191
-215
0
2 084
118
644
-35
0
727
network equipment in process
1 577
1 651
-30
0
3 198
network material in process
4 222
4 200
-2 674
0
5 748
other fixed assets in process
0
0
0
0
0
technical computer equipment in process
489
1 664
-292
0
1 861
office computer equipment in process
365
227
-391
0
200
office and housing furniture in process
58
70
-72
0
57
office and housing equipment in process
0
0
0
0
0
transportation materiel in process
561
1 484
-1 467
0
578
arrangements and installation in process
24
0
0
0
24
other fixed assets in proces
615
351
-249
0
717
customs on fixed assets in process
0
0
0
0
0
other exploitation materiel in process
0
0
0
0
0
425
20
0
0
445
16 255
19 410
-8 432
0
27 234
advances, deposits on software
0
0
0
0
0
advances on buildings
0
0
0
0
0
advances on transportation equipment
0
0
0
0
0
advances & deposits on other fixed assets
0
0
0
0
0
advances and deposits on fixed asset
0
0
0
0
0
507 210
24 684
0
1 781
530 115
labels
Sonatel equipment in process transmission equipment in process mobile 2g / 3g network access equipment in process
measurement equipment in process
fixed assets lettering material in process
general total
105
Sonatel 2014 annual report of activities
Sonatel SA financial statements (in millions Xof)
table n° 2 : depreciation changes 31/12/2014 Balance as of 31/12/13
Increases
Reclassification
Retirement Disposal
Balance on 31/12/14
13
0
0
0
13
depreciation patents, licences
1 535
177
0
0
1 712
depreciation software
25 862
2 617
0
0
28 479
total 281
27 410
2 794
0
0
30 205
depreciation development works
0
0
0
0
0
total 282
0
0
0
0
0
14 368
713
0
0
15 081
depreciation staff housing
965
27
0
0
992
depreciation office installation and organization
34
2
0
0
36
depreciation tracks and roads
130
0
0
0
131
depreciation other infrastructures works
279
22
0
0
301
depreciation other installations and organizations
10 307
742
0
32
11 018
total 283
26 085
1 506
0
32
27 559
depreciation sonatel switching equipment
33 432
836
0
0
34 268
depreciation public switching equipment
0
0
0
0
0
depreciation transmission equipment
106 368
4 778
0
9
111 137
depreciation public lines and networks
116 181
2 470
0
0
118 651
depreciation sonatel lines and network
228
39
0
0
267
31 371
3 395
0
28
34 737
0
0
0
0
0
29 739
2 459
0
15
32 184
32
3
0
0
35
317 352
13 981
0
52
331 279
labels depreciation research development
depreciation admin. and commercial buildings
depreciation energy equipment depreciation access network and equipment depreciation network and data equipment depreciation other operating equipment total 2841
106
annual report of activities Sonatel 2014
Sonatel SA financial statements (in millions Xof)
table n° 2 : depreciation changes 31/12/2014 Balance as of 31/12/13
Increases
Reclassification
Retirement Disposal
Balance on 31/12/14
1 939
121
0
5
2 054
depreciation housing furniture
2
0
0
0
2
depreciation office equipment
2 051
78
0
19
2 110
depreciation housing equipment
4
1
0
0
5
depreciation technical computer equipment
10 068
328
0
0
10 396
depreciation computer office equipment
3 972
364
0
105
4 231
total 2844
18 035
892
0
129
18 798
depreciation light vehicles
7 242
1 071
0
1 484
6 829
depreciation heavy vehicles
139
7
0
0
146
depreciation motorcycles
152
6
0
3
154
7 530
1 084
0
1 487
7 130
depreciation design, fixtures and installations
0
0
0
0
0
total 2847
0
0
0
0
0
depreciation devices
3 045
97
0
0
3 142
depreciation other fixed assets
1 989
173
0
1
2 161
total 2848
5 033
270
0
1
5 303
401 446
20 527
0
1 700
420 273
labels depreciation office furniture
total 2845
general total
Sonatel SA financial statements (in XOF millions)
table n° 3 : gains and losses disposal Gross Amount A
Depreciation done B
Valeur Net book value C=A-B
0
0
tangible assets
1 781
financial assets
intangible assets
total
Disposal price
+ Gain - loss
D
E=D-C
0
0
0
1 700
81
165
84
0
0
0
0
0
1 781
1 700
81
165
84
107
Sonatel 2014 annual report of activities
Sonatel SA financial statements (in millions Xof)
tableau n°4 : provisions written in the balance sheet a
b
c
provision at the beginning of the year
increases: expenses
decreases : reprises
operating
798
2. financial Provisions for liabilities and expenses
nature
d = a+b+c
operating
0
0
0
0
798
37 344
9 124
0
7 636
0
38 832
3. provisions for fixed assets depreciation
1 295
275
0
692
0
877
total i
39 437
9 398
0
8 328
0
40 507
254
96
0
254
0
95
1. regulated Provisions
4. inventory depreciation 5. depreciation and provisioned risks (third party) 6. depreciation and provisionned risks (cash)
financials
0
financials
0
outside ordinary activities
provision at the end of the year
outside ordinary activities
0 11 418
0 1 357
0
2 011
0
0
10 763 0
1
0
0
total ii
11 673
1 452
0
total ( i ) + ( ii )
51 110
10 851
0
0
0
1
0
2 266
0
0
10 860
0
10 594
0
0
51 366
Sonatel SA financial statements
(in millions Xof)
tableau n°5 : assets acquired through capital lease and related contracts none
108
annual report of activities Sonatel 2014
Sonatel SA financial statements (in millions Xof)
tableau n°6 : debts maturities at the end of the fiscal year analysis by maturities gross amount
at least one year of which are due
between 1 and 2 years
other analysis at more amounts than 2 in foreign years currency
amounts to affiliated companies
amounts represented by promissory notes
receivables of fixed assets (I)
114 212
30 404
0
13 972
69 836
0
0
0
loans (1)
80 328
11 972
0
11 972
56 384
0
0
0
0
0
0
0
0
0
0
0
other financial assets
33 884
18 432
0
2 000
13 452
0
0
0
assets receivables (II)
236 168
236 168
0
0
0
0
0
0
account receivables
5 391
5 391
0
0
0
0
0
0
135 586
135 586
0
0
0
0
0
0
994
994
0
0
0
0
0
0
0
0
0
0
0
0
0
0
18 676
18 676
0
0
0
0
0
0
0
0
0
0
0
0
0
0
shareholders and group
10 031
10 031
0
0
0
0
0
0
various Debtors
65 489
65 489
0
0
0
0
0
0
O.O.A. RECEIVABLES
0
0
0
0
0
0
0
0
prepaid expenses
1
1
0
0
0
0
0
0
350 380
266 572
0
13 972
69 836
0
0
0
receivables from participations
clients and associated accounts staff social Security and other socal agencies state international organizations
total (I) + (II)
(1) loans granted during the fiscal year : : Reimbursements obtained during the fiscal year :
14 156 11 590
109
Sonatel 2014 annual report of activities
Sonatel SA financial statements (in millions Xof)
tableau n°7 : debts maturities at the end of the fiscal year analysis by maturty at least 1 year gross amount
which are due
between 1 and 2 years
other analysis amount at more amount to affiated than in foreign compa2 years currency nies
amounts represented by promissory notes
financial liabilities and assimilated resources convertible bond debts (1)
0
0
0
0
0
0
0
0
other bond debts (1)
0
0
0
0
0
0
0
0
loans and debts from credit institutions (1)
1 146
436
0
237
473
0
0
0
other financial debts (1) (2)
60
0
0
0
60
0
0
0
1 206
436
0
237
533
0
0
0
property leasing debts
0
0
0
0
0
0
0
0
equipment Leasing debts
0
0
0
0
0
0
0
0
assimilated contracts debts
0
0
0
0
0
0
0
0
total (II)
0
0
0
0
0
0
0
0
59 200
59 200
0
0
0
0
0
0
877
877
0
0
0
0
0
0
9 010
9 010
0
0
0
0
0
0
413
413
0
0
0
0
0
0
72 216
72 216
0
0
0
0
0
0
0
0
0
0
0
0
0
0
associated and group
52 854
52 854
0
0
0
0
0
0
various debtors
8 371
8 371
0
0
0
0
0
0
O.O.A. DEBTS
6 217
6 217
0
0
0
0
0
0
0
0
0
0
0
0
0
0
total (III)
209 158
209 158
0
0
0
0
0
0
total (I + II + III)
210 364
209 594
0
237
533
0
0
0
total (I)
current assets - liabilities suppliers and related accounts clients staff social security and social agencies state international organizations
unearned income
(1) loans subscribed during the fiscal year : 191 / (2) total debts owned to shareholders (indivudual persons)
110
loans reimbursed during the fiscal year
: 8 933
annual report of activities Sonatel 2014
Sonatel SA financial statements (in millions Xof)
tableau n°8 : intermediary consumptions of the fiscal year nature
account number
amount
Water
6051
97
Electricity
6052
3 796
Other Energies
6053
0
None stockable maintenance supplies
6054
2
None Stockable office supplies
6055
0
Small Equipment
6056
168
Transportation on behalf of third party
613
0
Staff transportation
614
396
Real estate maintenance and repair
6241
663
Equipment maintenance and repair
6242
138
Publicity, publication, public relations
627
1 563
Telecommunication expenses
628
73 460
Payments of intermediaries and consultants
632
9 604
111
Sonatel 2014 annual report of activities
Sonatel SA financial statements (in millions Xof)
tableau n°9 : income allocation and other particular elements of the last five years concerned exercices (1) nature of indication
2014
2013
2012
2011
2010
50 000
50 000
50 000
50 000
50 000
100
10
10
10
10
preferred dividend shares (a.d.p.) with no voting right
0
0
0
0
0
new shares to be issued
0
0
0
0
0
through bond conversions
0
0
0
0
0
through exercice of subscription rights
0
0
0
0
0
sales turnover net of taxes
355 643
346 392
318 238
282 711
286 930
income from ordinary activities (i.a.o.) out of provision and reversals (operating and financial)
240 500
218 382
240 484
190 918
231 085
0
0
0
0
0
income tax
45 470
40 982
39 434
18 404
26 153
net income (4)
173 666
147 513
172 132
127 236
170 987
160 000
155 000
150 000
145 000
140 000
1 600
15 500
14 500
14 500
14 000
1 752
1 821
1 850
1 815
1 824
capital structure at the end of the year (2) authorized capital common shares
operationel income of the year (3)
workers’ contribution to profits
income per share distributed income 5) dividend allocated to each share (in xof) staff and wages policy average number of workers in the period (6) average number of external staff
3
5
3
3
3
distributed payroll during the period (7)
50 051
46 501
42 318
42 453
40 858
benefits packages paid during the period (8) {social security, charity works}
4 429
3 980
3 940
3 906
3 671
external staff billed to the company (9)
2 021
1 953
1 724
1 726
1 364
(1) included the period of which the financial statements are submitted to the assembly (2) indication in case of partial release of the capital of the none called capital (3) the elements of this item are in the income statement (4) when the result is negative, it should be put into brackets (5) the n period corresponds to the suggested dividend of the last period (6) the company’s own staff (7) all the 661, 662, 663 accounts (8) all the 664, 668 accounts. (9) 667 account.
112
annual report of activities Sonatel 2014
Sonatel SA financial statements (in millions Xof)
tableau n° 10 : 2012 fiscal year income allocation project allocations
amount (1)
origins
amount (1)
legal reserve
0
previous balance bought forward (loss)
0
stratutory or contractual reserves
0
balance carried forward ( recipient)
0
other (available) reserves
13 666
net income of the period
173 666
dividends (2)
160 000
deduction on reserves (3)
0
control :total A = total B
173 666
other allocations
0
balance carried forward
0
total (A)
173 666
1) the negative amounts must be put into brackets or preceded by a (-) sign. 2) in case of several beneficiaries to dividends, indicate the amount of each of them. 3) indicate reserve accounts from which deductions are made
113
Sonatel 2014 annual report of activities
Sonatel SA financial statements (in millions Xof)
tableau n°11 : workfoce, wages and external staff 1) local staff
wages (in million XoF) other countries of ECOWAS
locals
outside ECOWAS
M
F
M
F
M
F
609
316
0
0
4
0
335
262
0
0
0
150
40
0
0
38
1
0
1 132
619
0
total
locals
other countries of ECOWAS
outside ECOWAS
total
M
F
M
F
M
F
929
18 450
9 574
0
0
1 987
0
30 011
0
597
10 149
7 938
0
0
0
0
18 087
0
0
190
4 544
1 212
0
0
0
0
5 756
0
0
0
39
1 151
30
0
0
0
0
1 182
0
4
0
1 755
34 295
18 753
0
0
1 987
0
55 036
qualifications employed staff 1. Senior Executives 2. Senior Technicians and middle managers 3. Technicians, Supervisors and skilled workers 4. Employees, laborers, workers and apprentices total ( 1 ) permanent seasonal
114
annual report of activities Sonatel 2014
Sonatel SA financial statements (in millions Xof)
2) external staff
local staff
other countries of ECOWAS
outside ECOWAS
M
F
M
F
M
F
1. senior executives
0
0
0
0
0
0
2. senior technicians
0
0
0
0
0
and middle managers
0
0
0
0
3. technicians, supervisors
0
0
0
and skilled workers
632
0
0
4. employees, laborers, workers and apprentices total ( 2 )
total
invoiced to the company (in million XoF) M
F
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
632
1 466
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
632
0
0
0
0
0
632
1 466
0
1 764
619
0
0
4
0
2 387
37 748
18 753
permanent seasonal total ( 1 + 2 ) M = Male F = Female
115
>
Sonatel 2014 annual report of activities
auditors’ general and special report
financial statements – for the fiscal year ending 31 December 2014 Dear Shareholders, In compliance with the terms of our appointment entrusted to us by your General Assembly, we hereby present our report for the year ended December 31st, 2014, on: • the audit of consolidated financial statements of Sonatel (National Telecommunications Company of Senegal), Sonatel Mobiles, Orange Mali, Sonatel Multimedia, Sonatel Business Solutions, Orange Guinea and Orange Bissau; • the specific verifications and information required by law.
1. o pinion on the financial statements We have audited the consolidated financial statements attached of the Sonatel Group comprising the balance sheet, income statement, the financial table of resources and uses, as well as the annex notes to the consolidated financial statements of Sonatel for the period from 1st January to 31st December 2014.
Management’s responsibility for financial reporting Management is responsible for the preparation and fair presentation of financial statements in accordance with OHADA accounting system and internal control as management deems necessary for the preparation of financial statements that are free of material misstatement, whether due to fraud, or error.
Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. Our audit was conducted in accordance with auditing standards applicable in Senegal. Those standards require that, we
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comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The choice of procedures performed, including the risk assessment that the financial statements contain material misstatements, whether due to fraud, or error, depend on the judgment of the auditor. In making those risk assessments, the auditor considers internal control relevant to the entity in the preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, and not in the purpose of expressing an opinion on the effectiveness of internal control of the entity. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management and the overall presentation of the financial statements. We believe that the audit evidence obtained is sufficient and appropriate to provide a basis for our opinion.
annual report of activities Sonatel 2014
opinion In our opinion, the consolidated financial statements attached to this report are true and fair and present fairly the financial position, wealth and the results of the assembly constituted by the entities included in the consolidation, in accordance with rules and procedures accountants issued by the accounting System of OHADA.
2. specific verifications and information We have also performed the specific verifications required by the OHADA Uniform Act relating to Commercial Companies and Economic Interest Grouping. We have no matters to report regarding the fair presentation and consistency with the financial statements of the information given in the report of the Board of Directors and in the documents addressed to the shareholders on the financial position and consolidated accounts of the Sonatel Group.
The Auditors GARECGO JPA INTERNATIONAL NETWORK MEMBER
RACINE
ERNST & YOUNG MEMBER
16th February 2015
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Sonatel 2014 annual report of activities
Auditors’ general report
financial statements – for the year ending 31 December 2014
Dear Shareholders, In compliance with the terms of our appointment entrusted to us by your General Assembly, we hereby present our report for the year ended December 31, 2014, on: • The audit of financial statements of the National Telecommunications Company of Senegal (Sonatel) • The specific procedures and disclosures required by law.
1. opinion on the financial statements We have audited the financial statements, that is to say the balance sheet, income statement, financial table of resources and uses, as well as the annex notes to the financial statements of your company for the period from 1 January to 31 December 2014.
management’s responsibility for financial reporting Management is responsible for the preparation and fair presentation of financial statements in accordance with OHADA accounting system and internal control as management deems necessary for the preparation of financial statements that are free of material misstatement, whether due to fraud, or error.
auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. Our audit was conducted in accordance with auditing standards applicable in Senegal. Those standards require that, we comply with ethical requirements, to plan and perform the audit in order to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
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the financial statements. The choice of procedures performed, including the risk assessment that the financial statements contain material misstatements, whether due to fraud, or error, depend on the judgment of the auditor. In making those risk assessments, the auditor considers internal control relevant to the entity in the preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, and not in the purpose of expressing an opinion on the effectiveness of internal control of the entity. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management and the overall presentation of the financial statements. We believe that the audit evidence obtained is sufficient and appropriate to provide a basis for our opinion.
opinion In our opinion, the financial statements attached to pages 4 to 47 to this report are true and fair and present a true image of the compalny’ financial position as of 31 December 2014, its results, its wealth and the changes in financial position for the year that ended in accordance with accounting policies issued by the Accounting System of OHADA..
annual report of activities Sonatel 2014
2. specific verifications and information We have also performed the specific verifications required by the OHADA Uniform Act relating to Commercial Companies and Economic Interest Grouping. We have no issue to report regarding the fair presentation and consistency with the financial statements of the
information given in the report of the Board of Directors and in the documents addressed to the shareholders on the financial position and the consolidated accounts of the Sonatel Group.
The Auditors GARECGO JPA INTERNATIONAL NETWORK MEMBER
RACINE
ERNST & YOUNG MEMBER
16th February 2015
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Sonatel 2014 annual report of activities
accounting methods and policies basis of preparation of financial statements
immobilized charges and intangible assets
The financial statements are prepared on the basis of generally accepted accounting principles admissible and retained in the OHADA accounting system: prudence, consistency of methods, specialized exercises, historical costs, business continuity, transparency and material significance.
Expenses relating to loans granted for the financing of major investment projects and supported during the completion of these works until the end are capitalized.
The annual financial statements are presented in accordance with the requirements of OHADA accounting system and the main accounting policies and methodologies used are as follows:
They are depreciated over a period of five (5) years. «Unbundled» software (which are subject to a separate invoicing of computer equipment) are capitalized and depreciated over the estimated life of three (3) years. Foreign exchange differences to share are assessed according to the principles of currency transactions.
tangible assets They are valued at their acquisition cost, which includes the purchase price and the related costs and depreciated on a straight-line method based on the estimated useful lives as follows: Buildings Land enhancement work Equipment, office and home furniture Fixtures, fittings and installations Transportation equipment
20 years 40 years 5 years 8 years 3 et 5 years
Operating equipment: • Switching • Transmission • Lines and Networks • Energy • Measuring Equipment • Other assets
10 years 10 years 10 years 7 years 3 years 5 et 10 years
Assets in progress are recorded at their acquisition cost and are reclassified as tangible assets at their entry into service.
other current assets They concern advances and down payments for the purchase of tangible assets, the housing and vehicle loans to employees, the government loans to staff to
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acquire shares in the company (10 percent), security deposits and guarantees paid on water and electricity subscriptions, but also prepaid rent, government PBE securities (levy for the budget of equipment) and equity investments. These assets are valued and recorded at historical cost. On securities, provisions for depreciation are recognized when the closing value is less than the historic cost.
annual report of activities Sonatel 2014
The closing value is either the market price for quoted securities or the value of net assets for unquoted securities.
inventories Inventories are valued at the weighted average cost of purchases. The values used for local purchases represent the real exact cost and final listed on the annex on the procurement contracts. The purchase cost of imported products is the market value plus custom tariffs and transit fees. Inventories that have not registered any movement for more than a year are depreciated at 100 percent.
receivables accounting services to local customers The services to local customers are invoiced in local XOF at the date of issuance of the invoice and recorded in the accounts 41. Services not yet invoiced at the balance sheet date are recorded in accounts 418 «Accrued income». Doubtful loans to private clients who have more than six months old are depreciated at 100 percent.
accounting of revenue from international traffic Traffic balances are established monthly, bimonthly or quarterly on the basis of statements recorded and, after acceptance by the concerned foreign correspondent in a debit or credit account depending on the month, bimonthly or quarterly balance. At the end of the year, a provision is calculated for all traffic balances not yet accepted. It is recorded in account 418300 «Customers, international operators invoices not received» when the balance is in favor of SONATEL and account 408400 account «Suppliers international operators, invoices not received» in the opposite case.
Foreign currencies traffic balances are re-calculated at the prevailing rate at the balance sheet date if they are not settled and the exchange differences are dealt with as follows: • potential loss of exchange are recognized as expensed for the year; • Unrealized exchange gains are not recognized as income. Foreign exchanges losses and gains are recognized in the balance sheet in accounts 478 or 479 «conversion variance». Claims on foreign operations are depreciated on a case-by-case basis, depending on the operator’s creditworthiness.
foreign currencies transactions Foreign currency accounts are converted at exchange rates prevailing at the date of exercise and the resulting amounts are thus reconciled with the values recorded on the basis of exchange rates on the date of the transaction. The differences observed are treated as follows:
the balance sheet: • Potential foreign exchange gains are not recognized as revenue but recorded in account 479 «conversion variance liabilities» on the balance sheet.
in the income statement: • The unrealized exchange rate losses on transactions of more than one year are recorded as liabilities in the account «Provision for exchange rate losses» and the counterparty is recorded in the balance sheet in the account 478 «Exchange rate differences». • The unrealized exchange rate losses on transactions within one year are recorded in the account 679 «Expenses accrued on financial risks», by the credit of account 499 «Provisioned risks on operating transactions. • Losses on cash accounts are recorded in the income statement through the cash account.
Foreign currencies traffic balances are recorded at the prevailing rate at the accounting date. Exchange rate differences arising during the settlement of past due invoices are recorded as exchange gain or loss.
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Sonatel 2014 annual report of activities
provisions for liabilities and charges
investment grants
disputes
The amortized share for the fiscal year is recognized in the income statement.
All potential risks in litigation with third parties are provisioned according to information provided by the company’s legal services. Unjustified Provisions are reported in the income statement.
retirement Benefits Allowances due to staff at the retirement or on a contractual basis are subject to a provision for losses and expenses.
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annual report of activities Sonatel 2014
auditors’ special report on regulated agreements for the fiscal year
ending 31 December 2014 Dear Shareholders, In our capacity of Auditors of your Company, we hereby present our report on regulated agreements. It is our duty to inform you, on the basis of the information we were provided, the essential characteristics and conditions of those agreements brought to our attention, without expressing an opinion on their usefulness and appropriateness. It is your responsibility, pursuant to Articles 440 and followings of the OHADA Uniform Act relating to Commercial Companies and Economic Interest Group, to assess the interest involved in the conclusion of these conventions for their approval. We were informed of the execution of the following agreements, concluded during the year and previously authorized by the Board of Directors. We have conducted our audit in accordance with professional auditing standards; Those standards require that we perform due deligence to verify the consistency of the information we have been provided with the basis documents from which they are derived.
1. loan Agreement with Orange Mali concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique • Mr. Cheikh Tidiane Mbaye • Sonatel Company, represented by Mr. Birago Diene Moctar Beye • Mr. Fabrice Andre
nature and purpose It is a loan agreement between the Company Orange Mali and Sonatel signed on 21 April 2014. It provides to Orange Mali a loan of 15 billion XOF in the form of shortterm credit for a period of six (6) months and shall begin to run from 21 April 2014. This loan is intended solely to fund the payment by Orange Mali of the dividends for the year 2013.
terms and effects The loan given by Sonatel will bear an interest rate of 5 percent per annum. Interest begins to accrue from 21 April 2014 and is paid quarterly. The loan then granted is not subject to disbursement in a bank account of Orange Mali. It will be directly deducted from dividends payable by Orange Mali to Sonatel. On 31 December 2014, the loan was fully repaid and interest recognized for the period totaled 271 million XOF.
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Sonatel 2014 annual report of activities
2. a ssistance agreement with Orange Services Group concerned Directors • Sonatel company represented by Mr. Alioune Ndiaye • Mr. Cheikh Tidiane Mbaye
nature and purpose This is an assistance agreement for the management through the provision of permanent experts to the group Sonatel with the Orange Services Group (GOS). This agreement was validated during the 155th meeting of the Board of Sonatel on 18 September 2014 and at the 14th meeting of the GOS SA Board of Directors. This agreement was concluded for an indefinite period. it is retroactive and begins to run from 1 January 2014.
terms and effects In the case of a seconded expert, the invoicing will be 7 million FCFA / month man (employee) and 9 million FCFA / month man if the employee is in a position of Managing Director or Deputy Managing Director. In the case of a temporary expert, the invoicing will be 350,000 FCFA / day man. This bill does not include travel and subsistence expenses. In the case of other assistance services, the billing must be agreed between the two parties before the actual startup of the execution of the requested service. On 31 December 2014, the effects produced by the agreement are only applied to assistance services for permanent experts and amounted of a total of 195 million FCFA.
3. a ssistance agreement with the Sonatel Mobiles concerned Directors • Mr. Jerome Henique • Mr. Alioune Ndiaye • Mr. Fabrice Andre • Mr. Hugues Foulon • Sonatel Mobiles Company represented by Mrs. Aminata Ndiaye
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nature and purpose This is an amendment to the assistance agreement with Sonatel Mobiles, signed on 21 December 2012 and mentionned on article 4 of the present report. This amendment was previously authorized at the 153th meeting of Sonatel Board of Directors on 19 April 2014 and at the 61st meeting of Sonatel Mobiles Board of Directors on 10 April 2014. The object of this amendment is to complete the billing terms of an expected service under the assistance agreement.
4. assistance agreement with the Sonatel mobiles concerned Directors • Mr. Jerome Henique • Mr. Alioune Ndiaye • Mr. Fabrice Andre • Mr. Hugues Foulon
nature and purpose It is an agreement signed on 21 December 2012 (with retroactive effect from 1 September 2012) between Sonatel and Sonatel Mobiles. This agreement replaces the agreement signed on 23 September 2008 and its amendments 1 and 2 of 11 February 2010 and 20 July 2010. This agreement provides in particular: • transfer of know-how of Sonatel in the field strategic planning, technical, commercial and control • the transfer of staff from Sonatel Mobiles to Sonatel • technical assistance on the management provided by Sonatel to Sonatel Mobiles by providing experts on permanent basis; • occasional technical assistance at the request of Sonatel Mobiles. These include assistance in the following areas: • legal, regulatory and bill recovery • marketing, • technical and information technology, • use of Sonatel management tools and software, • Sonatel expertise through the establishment of hightech equipment,
annual report of activities Sonatel 2014
• Marketing management and communication, • Management of “One Card” (prepaid cards), • Management and cash management of Sonatel Mobiles by Sonatel, • Management of accounting activities and taxation, • Management of procurement and logistics activities, • Management of roaming and interconnection activities, • Miscellaneous services (sites usage, materials, energy ...)
Mobiles will rebill communication costs (including advertising taxes) paid on behalf of Sonatel. The advertising tax will be invoiced in proportion to the turnover of the year N (excluding wholesale turnover).
This agreement was the subject of an addendum mentioned in paragraph 3 of this report
Under the management of “One Card” (prepaid cards), the expenses for the costs of purchasing these cards will be billed based on the following method: number of cards used on services in the fixed-lines services X average unit cost of management (WAC) of the previous year.
terms and effects In return for the transfer of know-how and personnel, Sonatel Mobiles pays to Sonatel a flat annual fee calculated on the basis of 5 percent of annual turnover. The cost of staff seconded permanently involved in the governance and management of Sonatel Mobiles will be borne by Sonatel Mobiles. Experts seconded on a permanent basis will be billed up to 7 million XOF/month/man. Temporary experts are invoiced at 350.000 XOF/day/ man.
The parties agree that Sonatel Mobiles will pay the activities of outsourced technical hotline. It will invoice to Sonatel its share.
Sonatel Mobiles will repay to Sonatel his part of the turnover due to this latter. Under management and centralization by Sonatel of Sonatel Mobiles’ cash management: • for cash receipts done at Sonatel’s counters and their accounting, Sonatel Mobiles will be invoiced by Sonatel up to 2 percent of the total amount collected;
Legal, regulatory and bill collection technical assistance will be billed by Sonatel for a lump sum of 250 million XOF.
• loans and borrowings granted to each other will be paid at a rate defined by the nature of the loan. Costs generated by the transactions on bank accounts on behalf of Sonatel Mobiles by Sonatel will be billed at the prorate of transactions done;
The distributions of refill cards and SIM cards will be billed respectively up to 4 percent and 10 percent of turnover with retailers.
• remuneration of current accounts will be paid by Sonatel Mobiles depending on the amount of surplus and overdraft of Sonatel Mobiles.
The network management and computer technology will be billed in proportion to the resources allocated by Sonatel.
The management of accounting and taxation activities will be billed for an annual lump sum of 623 million XOF.
The use of Sonatel’s software and management tools (Oracle and Business Intelligence ...) be billed in proportion to the resources used. Under the management of its marketing and communication activities, Sonatel will invoice to Sonatel Mobiles an annual fee equal to 1 percent of annual turnover of Sonatel Mobiles outside group. Sonatel
The management of procurement and logistics activities will be billed for an annual lump sum of 300 million XOF. The management of roaming and interconnection activities will be billed for an annual lump sum of 50 million XOF.
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Sonatel 2014 annual report of activities
Over the year, this agreement generated a total of 40,927 million XOF, which break down as follows:
in millions of XOF management fees
14,352
experts on secondment
0
temporary experts
0
payments done at windows
574
marketing and Communication: • annual fee
2,680
• communication costs
(75)
• advertising tax
-
“one Card” Management: • cost of cards management
(26)
• part of SONATEL turnover
802
legal, regulatory, bill collection assistance
250
distribution of refill and SIM cards
12,863
technical management and Information Technology network management
6,750
software usage
941
hotline management ACL
843
roaming and Interconnection
50
accounting and taxation
623
purchasing and Logistics
300
total
5. cooperation agreement with Sonatel Multimedia concerned directors • Mr. Jerome Henique. • Sonatel Company, represented by Mr. Birago Diene Moctar Beye
nature and purpose This is a technical assistance agreement signed on 21 December 2012 (with retroactive effect from 1 September 2012) between Sonatel and Sonatel Multimedia. This agreement replaces the agreement signed on 17 December 2007 and its amendments 1, 2 and 3 dated
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40,927 on 3 March 2009, 15 October 2009 and 11 February 2010. This agreement shall include • transfer of know-how of Sonatel in the fields strategic planning, technical, commercial and management control. • occasional technical assistance (legal advice, dispute assistance, receivable collection, marketing services, use of management tools, vehicles and Sonatel expertise, building rentals, hosting in technical premises, services delivery, telephone hotline management, marketing and communication activity, technical and information technology, cash management and cash pooling, purchasing management, accounting and taxation, single billing management.)
annual report of activities Sonatel 2014
terms and effects In consideration for the transfer of know-how, Sonatel Multimedia will pay to Sonatel an annual fee (management fees) amounting to 1 percent of annual turnover excluding taxes. Under the assistance of legal advice, Sonatel charges a fixed annual amount of 5 million XOF excluding taxes. Under assistance in the field of litigation, Sonatel charges a flat annual amount of 5 million XOF excluding taxes. Under the management of accounting, treasury, purchasing, inventory and taxation, Sonatel charges a flat annual amount of 200 million XOF excluding taxes. Sonatel Multimedia also pays: • 2 percent of invoices cashed by Sonatel, • a commission of 20 percent of the costs of ADSL access and 15 percent for business solutions, • an annual lump sum of 260 million XOF in respect of technical activity and information technology
• in respect of marketing and communication activities, an annual lump sum equal to 1 percent of annual sales outside the group, • 350,000 XOF per expert per day • under the unique invoicing system, an amount equal to the proportion of resources used, and 3 percent of the amount billed for the activities, • in respect of the use of management tools (Oracle, ...), an amount equal to the proportion of resources committed, • under the management of the telephone hotline, an amount equal to the proportion of resources used, • in respect of Internet communication costs, an amount equal to the portion of the Sonatel Multimedia’s subscribers base on the total subscribers base, Depreciation of Sonatel vehicles used by Sonatel Multimedia is invoiced in proportion to the use of each entity. For the 2014 fiscal year, this agreement has generated royalties amounting to 1.431 million XOF broken down as follows:
in millions of XOF management fees
83
legal counsel and studies
5
accounting, treasury, purchasing, inventory, taxation
200
marketing of products
89
management tools (oracle ...)
119
expert
-
hotline management
143
engineering and information technology
260
marketing and communication
67
communication costs on the internet
40
use of vehicles single billing litigation collection of receivables
total
179 5 241
1,431
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Sonatel 2014 annual report of activities
6. participation Agreement concerned Directors • Mr. Marc Rennard • Mr. Thierry Breton • Mr. Hugues Foulon • Mr. Fabrice Andre • Mr. Jerome Henique • Sonatel Company, represented by Mr. Birago Diene Moctar Beye
nature and purpose This is a contract signed on 31 March 2012, between the JV (the company Buyin SA), the NATCO (Sonatel, Sonatel Multimedia, Sonatel Mobiles and Sonatel Business Solutions) and France Telecom. This contract is intended to lay the terms of the collaboration between the JV and Natco regarding procurement activities included in the scope of the JV. The scope of procurement activities of the JV concerns: • network technology, • customer equipment, • service platforms...
terms and effects This collaboration is without financial consideration.
7. cooperation Agreement between Sonatel and France Telecom concerned Directors • Mr. Marc Rennard • Mr. Thierry Breton • Mr. Hugues Foulon • Mr. Fabrice Andre
nature and purpose It is a cooperation agreement signed on 1 November 2011 (with retroactive effect from 1 January 2011) between France Telecom and Sonatel for a period of three (3) years. This agreement supersedes the previous agreement signed on 16 December 2004 and all its amendments. Through this agreement, France Telecom provides the know-how to Sonatel and its Senegalese subsidiaries
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and provides the following benefits to Sonatel and all its subsidiaries: • transfer of know-how in all areas of operation and the development of a telecommunications company (strategic planning, technical, regulatory, financial, information systems, purchasing, ...); •p ermanent technical assistance with the provision of permanent experts participating in the leadership and management of the company and its subsidiaries; •a d hoc technical assistance with the completion of timely and specific studies, problem solving related to the organization or operation.
terms and effects In consideration for the transfer of know-how and services rendered, Sonatel will pay France Telecom a yearly fee equivalent to 0.31 percent of turnover of the Senegal perimeter (Sonatel SA, Sonatel Mobiles, Sonatel Multimedia, Sonatel Business Solutions) net of intra-group activities. This fee has a ceiling of 1.43 percent of the Group Sonatel consolidated turnover for year 2010 and shall not be less than 0.20 percent of the annual turnover of the perimeter Senegal net of intra-group activities. For the 2014 fiscal year, recognized fees totaled 1.395 million XOF. For the cost of disposition of staff, Sonatel rebilled at France Telecom, expenses related to expatriates supported by Sonatel and are outside of the lump sum set by France Telecom. The amount of charges billed by Sonatel amounted to 214 million XOF on 31 December 2014.
8. memorandum of Understanding between France Telecom and Sonatel concerned Directors • Mr. Marc Rennard • Mr. Thierry Breton • Mr. Hugues Foulon • Mr. Fabrice Andre
annual report of activities Sonatel 2014
nature and purpose
terms and effects
A memorandum of understanding was signed on 1 November 2011 (with retroactive effect from 1 January 2011) between France Telecom and Sonatel. This protocol is valid until 31 October 2014. It supersedes the previous agreement signed 9 April 2008 and all its amendments.
The loan given by Sonatel will bear an interest rate of 9.5 percent per annum.
France Telecom and Sonatel agreed that the fee payable each year to France Telecom by Sonatel and its Senegalese subsidiaries under the cooperation agreement (the rate is set at 0.31 percent of the annual turnover of the companies inside Senegal perimeter) is limited to the amount to 1.43 percent of the 2010 consolidated turnover of the Sonatel Group.
On 31 December 2014, the outstanding loan amounts to 1,000 million XOF.
The consolidated turnover is defined as the consolidated turnover of the Sonatel Group net of intra-group Sonatel activities. Sonatel Group means Sonatel and its Senegalese subsidiary companies as well as Orange Mali, Orange Guinea and Orange Guinea-Bissau, as well as any other company by the SYSCOA standards will be consolidated in the accounts of Sonatel.
terms and effects In case the fee would exceed 1.43 percent of the consolidated turnover of the Sonatel Group, it will be adjusted so as not to exceed the amount corresponding to 1.43 percent of the consolidated turnover of the Sonatel Group. This fee cannot be less than 0.20 percent of the annual turnover of the companies inside the Senegal perimeter. As of 31 December 2014, the agreement has no effect in the accounts of Sonatel.
9. loan Agreement with Orange Bissau concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique
Interest shall begin to accrue from the date of disbursement of funds to the account of Orange Bissau.
Interest recorded for 2014 fiscal year amounted to 95 million XOF.
10. loan Agreement with Orange Bissau concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique
nature and purpose It is a loan agreement between the Company Orange Bissau and Sonatel signed on 29 October 2010 and provides to Orange Bissau a 5 years medium-term loan of 800 million XOF with a grace period of one year from the date of disbursement.
terms and effects The loan given by Sonatel will bear an interest rate of 9.5 percent per annum. Interest shall begin to accrue from the date of disbursement of funds to the account of Orange Bissau. At 31 December 2014, the outstanding loan amounts to 800 million XOF. Interest recorded for 2014 fiscal year totaled 76 million XOF.
nature and purpose It is a loan agreement between the Company Orange Bissau and Sonatel signed on 26 April 2010 and which provides to Orange Bissau a 5 years medium-term loan of 1,000 million XOF with a grace period of one year from the date of disbursement.
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Sonatel 2014 annual report of activities
11. loan Agreement with Orange Bissau concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique
nature and purpose It is a loan agreement between the Company Orange Bissau and Sonatel signed on 3 March 2009 and which provides to Orange Bissau a 5 years medium-term loan of 3,000 million XOF with a grace period of one year from the date of disbursement.
terms and effects The loan given by Sonatel will bear an interest rate of 10 percent per annum. Interest shall begin to accrue from the date of disbursement of funds to the account of Orange Bissau. On 31 December 2014, the outstanding loan amounts to 3,000 million XOF. Interest recorded for 2014 fiscal year amounted to 300 million XOF.
12. long term loan agreement with Orange Bissau concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique
nature and purpose It is a loan agreement between the Company Orange Bissau and Sonatel. The agreement provides to Orange Bissau loan a medium-term credit of three (3) years for 1 billion XOF, which begins from the date of disbursement of funds.
terms and effects The loan given by Sonatel will bear an interest rate of 10 percent per annum.
Interest shall begin to accrue from the date of disbursement of funds to the account of Orange Bissau. The loan must be repaid by Orange Bissau in three (3) years with a grace period of one year from the date of disbursement of funds in accordance with the amortization schedule. The disbursement of this loan was done on 2 January 2009. On 31 December 2014, the loan balance is null. Interest recorded under this loan for the 2014 fiscal year amounted to 32 million XOF.
13. loan agreement with Orange Bissau concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique
nature and purpose It is a loan agreement between the Company Orange Bissau and Sonatel signed on 1 August 2007 and provides to Orange Bissau a five (5) years medium-term loan of 4,700 million XOF, which begins from the date of disbursement of funds. Following the share increase in 2011 by incorporation of debts, the outstanding loan has decreased 3.105 million XOF and totaled 1.595 million XOF.
terms and effects The loan given by Sonatel will bear an interest rate of 10 percent per annum. Interest shall begin to accrue from the date of disbursement of funds to the account of Orange Bissau. The loan must be repaid by Orange Bissau within five (5) years from the date of disbursement of funds in accordance with the amortization schedule. As of 31 December 2014, the outstanding loan is null. Interest recorded for the year 2014 amounted to 13 million XOF.
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annual report of activities Sonatel 2014
14. loan Agreement with Orange Guinea concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique
nature and purpose It is a loan agreement between the Company Orange Guinea and Sonatel signed on 27 December 2010. This agreement supersedes all loan agreements signed between Sonatel and Orange Guinea from 2008 to 2010. These grouped loans totaled to 26.573 million XOF and have a term of 5 years with a grace period of 5 years for principal and interest.
terms and effects The loan given by Sonatel will bear an interest rate of 9 percent per annum. At 31 December 2014, the outstanding loan amounts to 17.432 million XOF.
• occasional assistance for solving problems related to the organization (legal advice and studies, assistance in litigation, collection of receivables, finance and accounting, use of Sonatel’s management tools, use of vehicles, use of Sonatel’s expertise, rental of buildings, provision of services, accommodations in technical premises). This agreement was concluded for a period of 10 years. An amendment to this agreement was signed on 21 June 2007. This amendment takes into effect from the 2007 fiscal year the full benefits under the assistance agreement signed between the parties in 2005. Indeed, in addition to the services already provided in the original contract, it provides the billing of permanent assistance, as well as additional services. Amendment No. 2 was signed on 11 February 2010 and provides: • management and cash pooling, • management of accounting and taxation.
terms and effects
15. cooperation agreement with Sonatel Business Solutions concerned Directors • Sonatel company represented by Mr. Omar Gueye Ndiaye • Mr. Jerome Henique
nature and purpose This is a technical assistance agreement between Sonatel and Sonatel Business Solutions signed on 7 June 2005, and which includes: • transfer of know-how between Sonatel and Sonatel Business Solutions; • the management of permanent assistance with the availability of experts to participate in the management of the company;
In return for the services received, Sonatel Business Solutions agrees to pay to Sonatel an annual flat fee equal to 2 percent of its turnover excluding tax from the second year of operation, a lump sum of 5 million XOF for counsel and legal advice, reimbursement of attorneys, notaries and bailiffs fees on presentation of bills, 350,000 XOF per temporary expert per day. For experts, billing is done at actual cost plus a 15 percent margin. Rental equipment from Sonatel to Sonatel Business Solutions is billed according to following conditions: [(acquisition cost HT / depreciation period in days) x number of days of the loan] x 1.15. Management tools are billed on prorated licenses used. Sonatel charges to Sonatel Business Solutions for the accounting and tax management activities an annual lump sum of 38 million XOF. Assistance in litigation will be billed for an annual lump sum of XOF 5 million excluding tax.
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Sonatel 2014 annual report of activities
The amounts accounted by Sonatel on 2014 fiscal year under this agreement amounted to 581 million XOF and are detailed as follows:
in million XOF accounting assistance
38
management fees
75
seconded staff
440
vehicles rental
13
legal assistance
5
information technology management
10
total
581
16. assistance agreement with Orange Bissau concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique
nature and purpose This is an assistance agreement between the company Orange Bissau and Sonatel signed on 6 August 2007 and which includes a convention: • transfer of Sonatel’s know-how for the benefit of Orange Bissau in the areas of strategic planning in the area of procurement, human resources, financial management control, technical and commercial, • permanent assistance services by Sonatel with the availability of highly qualified personnel to perform executive functions, • occasional assistance at the request of Orange Bissau for specific studies • availability of Sonatel’s management tools to Orange Bissau. This agreement was subject to amendment No. 1 signed on 9 July 2008 in order to amend and delete the terms of the Convention of 6 August 2007 relating to the costs of Sonatel permanent staff available to Orange Bissau. Article 2 of the Addendum No. 1 to the agreement states that Sonatel will invoice to Orange Bissau the actual
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gross cost of staff available on a permanent basis, without applying EBITDA margin as long as it is negative An amendment was signed on 23 December 2011 with retroactive effect from 1 January 2011 to amend Article 2.2 of the agreement signed on 6 August 2007 relating to the payment of «management fees».
terms and effects In return of the services provided, Orange Bissau pays to Sonatel a fee of 3 percent of corporate turnover net of the amount of «management fees» paid directly to France Telecom under the contract signed between France Telecom and Orange Bissau. Under the permanent assistance services provided, Orange Bissau will bear the full costs of expatriate staff made available by Sonatel. Sonatel will charge to Orange Bissau the actual gross costs of staff available on a permanent basis, without applying an EBITDA margin as long as it is negative. Occasional assistance will be billed by Sonatel to Orange Bissau at 350.000 XOF/day/man Software Sonatel usage will be billed at a prorated amount of licenses used by Orange Bissau based on a base (depreciation amount+ maintenance costs) x 1.15.
annual report of activities Sonatel 2014
The amount accounted for the 2014 fiscal year under this agreement amounted to 645 million XOF and is as follows:
in million XOF management fees
442
seconded staff
175
occasional assistance
-
network management
28
information technology
-
total
645
17. license Agreement for the use of the Orange brand concerned Directors • Mr. Marc Rennard • Mr. Thierry Breton • Mr. Hugues Foulon • Mr. Fabrice Andre
nature and purpose These are license agreements for the Orange brand from Orange Brand Services Limited, France Telecom and Sonatel. These agreements apply from the 2007 conventions were the subject of an addendum signed on 9 April 2008, and include: • the granting by Orange Brand Services Limited, a non-exclusive license to use the brand «Orange» • the authorization to manage and operate the Orange brand internationally, including the right to grant sub-license the use of the Orange brand in their territory, • the support services for pre-launch and re-brand naming of the Orange Brand Services Limited, • the support services in terms of marketing and communication in the form of know-how, training, assistance, expertise, brand and other information and / or advice to help Sonatel and its subsidiaries. This agreement was concluded for a period of 10 years.
terms and effects Sonatel agrees to pay to Orange Brand Services Limited, or any other entity designated by the latter, an annual fee equal to 1.6 percent of turnover excluding taxes of activities under the brand name «Orange» activities.
The effect of this agreement on the 2014 fiscal year is 12 million XOF.
18. cooperation agreement with Orange Mali concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique • Mr. Cheikh Tidiane Mbaye
nature and purpose This is a technical cooperation agreement signed in August 2002 between Sonatel and Orange Mali in the following areas: • Transfer of Sonatel’s know-how for the benefit of Orange Mali, • Permanent assistance services by Sonatel in the areas of operational management, technical assistance, engineering and training, • Specific assistance to the request of Orange Mali for specific and occasional services • Assistance at the request of Orange Mali by Sonatel’ technical and business management tools • use by Orange Mali of Sonatel’s new software. This agreement was subject to three amendments signed on 18 November 2005, 23 December 2008 and 23 December 2011. The second amendment completes the services provided in the cooperation agreement and amendment No. 1 signed between the parties in 2002 and 2005.
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Sonatel 2014 annual report of activities
The third amendment was signed on 23 December 2011 with retroactive effect from 1 January 2011 and to amend Article 2.2 of the Agreement signed in August 2002 on the payment of «Management fees». In addition to the services already provided in these two initial contracts, the parties mutually agree to extend loans and borrowings.
terms and effects In return of the services provided, Orange Mali pays to Sonatel a fee of 3 percent of turnover net of «management fees» paid directly to France Telecom under the contract signed between France Telecom and Orange Mali. The services provided by the seconded permanent staff are invoiced at 7.5 million XOF per month per agent for the positions of Managing Director and Director and to a maximum up to 5.9 million XOF per month per agent for other positions.
Temporary expert missions are billed at the rate of 350,000 XOF per man / day. The use of Sonatel software will be billed on a prorated use of license by Orange Mali on the basis of (depreciation amount + maintenance costs) x 15 percent. Under amendment No. 2, the amount of loans made by a party will not exceed the amount of loans more than 60 percent of the average of 6 months monthly cash. The interest rate is the average rate over the last three DAT given to the lender plus 0.25 percentage points. If, because of the loan agreement, the lender incurs a debt, the applicable rate used is the output rate of said debt increased by 0.25 points. The amounts charges by Sonatel in the 2014 fiscal year amounted to 5.947 million XOF globally and are as follows:
in million XOF annual fee
5.464
seconded staff
283
information technology
196
ad hoc assistance
total
4
5 947
19. assistance agreement with Orange Guinea concerned Directors • Mr. Alioune Ndiaye • Mr. Jerome Henique
nature and purpose This is an assistance agreement between the company Orange Guinea and Sonatel signed on 21 June 2007 and which includes: • Transfer of Sonatel’s know-how for the benefit of Orange Guinea in the areas of strategic planning in procurement, human resources, financial management control, technical, marketing,
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• Permanent assistance services by Sonatel with the availability of highly qualified personnel to perform such executive functions, • Specific assistance to the request of Orange Guinea for specialized and specific activities • Availability of Sonatel’s management tools to Orange Guinea. An amendment was signed on 23 December 2011 with retroactive effect from 1 January 2011 and aims to amend Article 2.2 of the Agreement signed on 21 June 2007 on the payment of «management fees».
annual report of activities Sonatel 2014
terms and effects In return of the services provided, Orange Guinea pays Sonatel a fee of 3 percent of net turnover in the amount of «management fees» paid directly to France Telecom under the contract signed between France Telecom and Orange Guinea. Under permanent assistance services, Orange Guinea will bear the full costs of expatriate staff made available by Sonatel and pay an amount of 7 million XOF/ month man.
Benefit from specialized assistance will be billed by Sonatel Orange Guinea at a rate of 350.000 XOF /day/man. Using software Sonatel will be billed on a prorated use of licenses by Orange Guinea on the basis of (depreciation amount + maintenance costs) x 1.15. The amount recognized in 2014 fiscal year under this agreement amounted to 3.213 million XOF and is as follows:
in million XOF seconded staff management fees
638 2,478
occasional assistance
14
computer technology
83
total
3,213
20. memorandum of Understanding with Canal concerned director • Sonatel company represented by Ms. Marie Sow Diop.
nature and purpose There is a Memorandum of Understanding between Sonatel, Multi TV Africa and Canal Horizons Senegal. The MoU was signed on 5 May 2006 for a period of two years renewable by tacit agreement for 12 months. It provides for: • a carriage contract by Sonatel of the CanalSat Horizons bouquet ADSL TV via the Multiplay offer through its wired network ADSL, • a commercial distribution contract whose purpose for Sonatel and channel is to commercialize through their sales force, network subscriptions for CanalSat Horizons TV bouquet via ADSL, • a contract for the subscribers’ management by Sonatel.
terms and effects
Financial terms of the protocol are: Under the transportation and signal management Canal will pay to Sonatel a monthly fee 3.05 euros wi-
thout tax per subscriber. As such, a minimum amount guarantee (MG) determined by the following shall be settled by Canal to Sonatel: • Operation year 1: MG is 73,200 euros, • Operation year 2: MG for the second year of operation correspond to a carriage charge € 3.05 per subscriber, multiplied by ‘x’ multiplied by 12 months. «X» corresponds to twice the actual average number of subscription in Year 1 «x» is also equal to the minimum of 2,000 subscribers and maximum to 4,000 subscribers. Under the services related to the management of CanalSat Horizons bouquet TV ADSL subscribers. Canal will pay to Sonatel a monthly fee per subscriber established on the basis of a monthly average subscriber based on the following thresholds: • 4 euros per subscriber per month, if the average monthly number of subscribers is between 1 and 3000, • 3.5 euros per subscriber per month, if the average monthly number of subscribers is between 3.001 and 5.000, • 3 euros per subscriber per month, if the average monthly number of subscribers exceeds 5000.
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Sonatel 2014 annual report of activities
Under distribution of services In exchange for the distribution of CanalSat Horizons TV bouquet via ADSL, Canal Horizons Senegal to Sonatel pay a commission of 5 percent on the price excluding VAT of the total amount of the annual subscription CanalSat Horizons TV bouquet via ADSL subscribed via Sonatel by a new subscriber regardless of the rate structure chosen by the customer. For the 2014 fiscal year, the effects of this Memorandum of Understanding in the books of Sonatel are: •a n amount of 34 million XOF for the services of transportation and signal management, •a n amount of 224 million XOF for the services of subscriber management, •a n amount of 12 million XOF under the distribution services.
ting to the establishment and operation of networks and the services of telecommunications throughout the entire Senegalese territory for period of twenty (20) years.
22. reimbursement of directors In accordance to the Article 432 of the Uniform Act of OHADA on the law of commercial corporations and economic interest group, the Sonatel Board of Directors, at its meetings of 9 April 2008 and 13 October 2009 authorized the reimbursement of hotel and travel expenses of the directors between their normal place of work and place of meetings of the Boards or the Board Committees meetings. In the 2014 fiscal year, there was no reimbursement of expenses.
21. franchise Agreement 23. reimbursment of administrative fees
concerned Directors • Mr. Mamadou Sarr • Mr. Birane Diouf • Mr. El Haji Abdou Aziz Mbaye
nature and purpose A franchise agreement between the Government of Senegal and Sonatel was signed on 1 October 1985 and updated July 21, 1997.
terms Under this agreement, the Government of Senegal grants to Sonatel the Government franchise rights rela-
Following the article 432 of the OHADA Uniform Act relating to Commercial Companies and Economic Interest Group, the Sonatel Board of Directors, at its meetings of 9 April 2008 and 13 October 2009, authorise the reimbursement for hotel expenses and transport costs of the directors between their normal place of work and the Directors Board meetings or Committees Board meetings places. Under the 2014 fiscal year, there is no reimbursement of fees.
The Auditors GARECGO JPA INTERNATIONAL NETWORK MEMBER
16 February 2015
136
RACINE
ERNST & YOUNG MEMBER
>
annual report of activities Sonatel 2014
agenda of the general meeting of shareholders of Sonatel thursday, april 9th, 2015.
a. resolutions of the competence of the annual general assembly :
draft resolution 2 : allocation of 2014 year income.
1. review and approval of the financial statements for the year ended on december 31st 2014. 2. allocation of 2014 year income, 3. ratification of the appointment of Mr. Birane Diouf, 4. ratification of the appointment of Mr. Fabrice Andre and renewal of his administrator’s mandate, 5. renewal of Mr. Marc Rennard administrator’s mandate, 6. renewal of Mr. Hugues Foulon administrator’s mandate, 7. renewal of Mr. Thierry Breton administrator’s mandate, 8. approval of regulated agreements.
The General Shareholders’ Assembly approved the proposal of the Board of Directors decided to allocate dividends and reserves the profit for the year ended on 31st December 2014 up to the amount of 173.665.631.924 F cfa.
b. resolutions of the competence of the Extraordinary General Assembly : 9. approval of an regulated agreement. transfer of head office, 10. harmonisation of the statutes with the new provisions of the act of ohada uniform on commercial companies and economic interest group (AUSCGIE), 11. Consequential amendments to Articles 4, 6, 11, 13a, 16, 17, 19, and 23 of the statutes, 12. Powers of completion of formalities.
draft resolution 1 : review and approval of the financial statements for the year ended on december 31st 2014. The General Assembly, having heard the reading: 1. Of the Board of Directors’ Report on the activities of the company during the year ended on December 31st 2014 and the statements of that year,, 2. The General Report of the Statutory Auditors on the financial statements of that year. Approve Sonatel financial statements for the year ended on 31st December 2014 as they were presented as well as the transactions reflected in these financial statements and summarized in these reports.
The General Shareholders’ Assembly decides to allocate the result as follows: First dividend 3.000.000.000 Fcfa Additional dividend 157.000.000.000 Fcfa Other reserves 13.665.631.924 Fcfa __________________________
TOTAL
173.665.631.924 Fcfa
Accordingly, the Ordinary General Shareholders’ Assembly fixed at the first 30 Xof gross dividend and 1.570 Xof the final gross complementary dividend per share, bringing the total gross dividends to said 1.600 Xof per share. After deduction of withholding tax of 10 percent under IRVM, the net dividend of 1.440 Xof per share will be paid on or after 5th May 2014 in Dakar.
draft resolution 3 : ratification of the appointment of Mr. Birane Diouf. On the proposal of the Board of Directors and after deliberation, the General Shareholders’ Assembly decided to ratify the appointment of Mr. Birane DIOUF co-opted at the meeting of the Board of Directors on April 10th 2014 replacing Mr. Thierno FALL, who resigned. Mr. Birane DIOUF nominated will retain his mandate for the unexpired term of his predecessor until the Ordinary General Meeting called to approve the 2016 financial statements for the year ended on 31st December 2015.
Accordingly, taking note of the Auditors’ special report, the Annual Shareholders’ Assembly gives full and unreserved discharge the Directors and the Auditors on the performance of their duties for the year ended on 31st December 2014.
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Sonatel 2014 annual report of activities
draft resolution 4 : ratification of the appointment of Mr. Fabrice Andre and renewal of his administrator’s mandate. On the proposal of the Board of Directors and after deliberation, the General Shareholders’ Assembly decided to ratify the appointment of Mr. Fabrice ANDRE co-opted at the meeting of the Board of Directors on December 23th 2014 replacing Mr. Bernard GHILLEBAERT, who resigned. Mr. Fabrice ANDRE nominated will retain his mandate for the unexpired term of his predecessor until the Ordinary General Meeting called to approve the 2015 financial statements for the year ended on 31st December 2014. Following this appointment, the General Meeting notes that the mandate of Mr. Fabrice ANDRE expires at the close of this Ordinary General Meeting. It decides to reappoint Mr. Fabrice ANDRE for a period of three (3) years expiring at the close of the Ordinary General Meeting called to approve the 2018 financial statements for the year ended on December 31st, 2017. Mr. Fabrice ANDRE whose mandate was renewed hereby accepts the renewal and states that it is subject to any incompatibility or prohibition may prevent him from performing the duties of Administrator.
draft resolution 5 : renewal of Mr. Marc Rennard administrator’s mandate. The General Meeting notes that the mandate of Mr. Marc RENNARD expires at the close of this Ordinary General Meeting. It decides to reappoint Mr. Marc RENNARD for a period of three (3) years expiring at the close of the Ordinary General Meeting called to approve the 2018 financial statements for the year ended on December 31st, 2017. Mr. Marc RENNARD whose mandate was renewed hereby accepts the renewal and states that it is subject to any incompatibility or prohibition may prevent him from performing the duties of Administrator.
draft resolution 6 : renewal of Mr. Hugues Foulon administrator’s mandate. The General Meeting notes that the mandate of Mr. Hugues FOULON expires at the close of this Ordinary General Meeting. It decides to reappoint Mr. Marc RENNARD for a period of three (3) years expiring at the close of the Ordinary
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General Meeting called to approve the 2018 financial statements for the year ended on December 31st, 2017. Mr. Hugues FOULON whose mandate was renewed hereby accepts the renewal and states that it is subject to any incompatibility or prohibition may prevent him from performing the duties of Administrator.
draft resolution 7 : renewal of Mr. Thierry Breton administrator’s mandate. The General Meeting notes that the mandate of Mr. Thierry BRETON expires at the close of this Ordinary General Meeting. It decides to reappoint Mr. Thierry BRETON for a period of three (3) years expiring at the close of the Ordinary General Meeting called to approve the 2018 financial statements for the year ended on December 31st, 2017. Mr. Thierry BRETON whose mandate was renewed hereby accepts the renewal and states that it is subject to any incompatibility or prohibition may prevent him from performing the duties of Administrator.
draft resolution 8 : approval of an regulated agreement. After having heard the Auditors’ Special Report on the agreements referred to in Articles 438 and following of the OHADA Uniform Act relating to Commercial Companies and Economic Interest Grouping, the Ordinary General Shareholders’ Assembly approves: • The Amendment No. 1 to the initial cooperation agreement signed between Sonatel and Sonatel Mobiles, • Cooperation agreement signed between Sonatel and Grouping ORANGE Services, • the loan Agreement signed between Sonatel and Orange Mali.
draft resolution 9 : transfer of head office. The Shareholders’ Meeting resolves to transfer the head office of Sonatel to the following location: n°64 Voie de Dégagement Nord (VDN) in Dakar (Senegal).
draft resolution 10 : harmonisation of the statutes with the new provisions of the act of ohada uniform on commercial companies and economic interest group (auscgie). In accordance with Articles 907 and following of the AUSCGIE revised and entered into force on May 5th, 2014, the General Assembly decided to harmonize its Constitution with the new provisions.
annual report of activities Sonatel 2014
Are affected by this development in harmony the following items: • Article 6 of the Articles: Increase, • Article 11 of the Statutes: Board of Directors • Article 13a of the Articles: Proceedings of the Board, • Article 16 of the Statutes: The Audit Committee, • Article 17 of the Statutes: Regulated agreements, • Article 19 of the Statutes: the General Rules, • Article 23 of the Statutes: Expert minority.
draft resolution 11 : amendments to articles 4, 6, 11, 13 a, 16, 17, 19 and 23 of the statutes. As a result of resolutions 9, 10 above, the General Meeting of Shareholders changes as follow the Articles 4, 6, 11, 13a, 16, 17, 19 and 23 of the Articles:
1. Article 4 of the Statutes is amended as follows :
warranty actions, merely because of the approval by the General Assembly of accounts for the last year on its management. »
4. Article 13 of the Statutes is amended as follows :
« A director may, by letter or e-mail or telegram, mandate another director to represent him at a meeting of the Board of Directors (...) The Council shall be effective only if at least half of its members are present. The board of directors may be held by videoconference or other means of telecommunication. In this case, the Board of Directors may validly deliberate unless at least one third of directors is physically present. (...) In case of participation in the Board by videoconference or other means of telecommunication, it is mentioned in the minutes of technical problems possibly arising during the session and that disrupted its progress.
The registered office is at 64, Voie de Dégagement Nord (VDN) in Dakar (Senegal)…» (The rest remains unchanged)
(...) The minutes of the Board must be notified by any means in writing to each director as soon as possible and no later than at the convening of the next Board. »
2. Article 6 of the Statutes is amended as follows :
5. Article 16 of the Statutes is amended as follows :
« The share capital can be increased, either by the issuance of ordinary shares or preferred shares, or by increasing the par value of existing shares by a decision of the Extraordinary General Meeting of shareholders. However, after the general meeting authorized the capital increase, it may delegate to the Board of Directors the authority to decide on the capital increase. In this case, the General Meeting sets the period, not exceeding twenty-four (24) months, during which this delegation may be used and the overall limit of the increase. The board then has the necessary powers to set the terms of issue, record the completion of capital increases that result and proceed to amend the statutes (...) » (rest unchanged)
3. Article 11 of the Statutes is amended as follows :
« (…). The entity that will be represented on the Board of Directors shall be free to replace a representative with another natural person during the course of his director. Administrators cannot be shareholders at the time of their appointment, but shall, before entering upon his duties, hold a number of shares at least equal to that required for access to Annual General Meetings. (...) A retiring director is eligible for reappointment. Each director must own at least one hundred shares. These shares are allocated entirely to the guarantee of all management actions, even those that would be exclusively personal to one of the administrators. They are personal, inalienable; they cannot be pledged. If the day of his appointment, a director does not own the number of shares determined above, or if while in office he ceases to be the owner, he is deemed to have resigned if he has not rectified the situation within three months. To be eligible, an administrator must be under the age of 65. The former director or his beneficiaries freely dispose of
« The Board of Directors is mandatory with an audit committee .The committee is composed exclusively of non-employee directors of the company or exercising no mandate CEO, general manager or director deputy general society. The Board of Directors ensures the competence of directors appointed members of the Audit Committee. The Audit Committee’s core missions: • To examine the accounts and ensure the relevance and consistency of accounting methods adopted to prepare the consolidated and individual financial statements of the company, • Monitoring the preparation of financial information, • Monitor the effectiveness of internal control systems and risk management, • Issue an opinion on the statutory auditors proposed for appointment by the general meeting. It reports regularly to the Board of Directors of the performance of its duties and informs it promptly of any difficulties encountered. (...) «(The rest remains unchanged).
6. Article 17 of the Statutes is amended as follows :
« Article 17: Agreements between the Company and any of its Directors or Chief Executive or Deputy Chief Executive Officer or shareholder with a participation greater than or equal to 10% of the share capital of the company.»
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Sonatel 2014 annual report of activities
Any agreement, except those relating to current operations concluded under normal conditions, intervening between the company and one of its directors managing director or Deputy managing director or shareholder holding more than or equal to 10 % of share capital or company in which such persons are concerned, should be subject to the prior approval of the Board. It is the same for the conventions: • which a director or managing director or Deputy managing director or shareholder holding more than or equal to 10% of the share capital or company in which such persons are concerned, is indirectly interested or in which he deals with the company through an intermediary; • intervening between the company and a company in which the director or the managing director or Deputy managing director or shareholder with a participation greater than or equal to 10% of the share capital or company in which such persons are concerned is the owner, partner with unlimited , manager, director, managing director or managing Director, or CEO of the company. (…) Any approval by the Ordinary General Meeting of regulated agreements without presentation of the special report of the auditor is void.» (the rest remains unchanged)
7. Article 19 of the Statutes is amended as follows:
«The General Shareholders’ Meetings of any kind are held at the registered office or any other place.. (…) The shareholders will vote on resolutions wich will be proposed to them by any means established by the Company (show of hands, vote with secret ballots, electronic voting ... etc.).
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It is held an attendance sheet (...) If the Company decides, Shareholders may attend the Meeting remotely via videoconference or other telecommunication means permitting their identification and guaranteeing their effective participation and are deemed present for the calculating quorum and majority. To ensure the identification and effective participation in the meetings of shareholders who are participating remotely, these means transmit at least the voice of participants and meet the technical characteristics that allow continuous and simultaneous retransmission of deliberations. Shareholders participating in the Assembly vote remotely orally or by any other means established by the company. Are also considered present for the quorum and majority, the shareholders who voted by mail under the conditions of Article 133-1 of the Uniform Act.
8. Article 23 of the Statutes is amended as follows : « One or more shareholders representing (…)and the amount of the provision that the applicant(s) the Company will have to pay. » (the rest remains unchanged)
draft resolution 12 : Powers of completion of formalities. The General Shareholders’ Assembly grants full powers to the bearers of originals, copies or extracts of these resolutions to carry out all the formalities prescribed by law.
