annual report of activities Sonatel 2014
annual report
foreword
This report is a ref lection of our vision, ful l of
optimism and looking to the future. The Afr ican
hairstyle is a l iv ing art, constantly evolving.
As the continent itself , i t is incredibly r ich,
creative and varied. It feeds, inf luences and
reinvents itself every day to bui ld a perfect
bridge between tradit ion and modernity.
Today, Afr ican hairstyle has managed to cross
borders to meet international recognit ion. No
wonder, that the photographs in this report are
derived from a cosmopolitan col laboration.
Summaryletter from the Chairman p 06
message from the Managing Director p 08
1. good governance, pledge for transparency p 11
2. human Resources: transformation of human capital to meet Sonatel strategic challenges p 232.1 competency Development: more professional teams p 232.2 health: Welfare at Work :pledge of productivity p 24
3. Sonatel Citizen involvment p 293.1 Sonatel, operator engaged in the economic and social development in the countries of its presence p 293.2 philanthropy: 13 years of Sonatel Foundation’s commitment for the welfare of Senegalese population p 31
3.2.1 health: actions in six priority areas p 313.2.2 education: access and excellence for all p 323.2.3 promotion of culture in Senegal p 33
4. our activities p 35
the Senegalese market4.1 mobile: Orange has captured over 76% of growth market in 2014 p 354.2 fixed-lines and Internet: development of usages p 374.3 corporate service p 38
4.3.1 better focus on SMIs/ SMEs with the multiplying of the number of Pro spaces p 384.3.2 launch of B2B structuring offers p 38
4.4 pursuit of customer service transformation project, a key factor of differentiation and customer loyalty p 39
our subsidiaries abroad4.5 Orange Mali : Growth despite difficult economic and security conditions p 404.6 Orange Guinea : continued leadership and coverage of all sub-prefectures p 424.7 Orange Bissau consolidates its leadership through innovation p 42
4.7.1 significant investments to improve the service quality of the mobile voice network p 434.7.2 foundation for a strong CSR policy p 43
5. networks and information systems: Orange, leader on technical service quality p 455.1 mobile network modernization p 455.2 increase of 3G speeds p 455.3 4G test successfully managed in Senegal by Sonatel p 455.4 Evolution of IP core network, Voice, Mobile, national and international
transmission and service platforms p 46
6. Sonatel in the world p 49
7. finance p 537.1 key figures p 547.2 Sonatel traded share p 617.3 financial report p 63
8. annexes- financial statements p 84- general and special reports such as Auditors’ Reports p 117
5
Sonatel 2014 annual report of activities
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Marc RennardChairman of the Board
In 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.
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.
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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.
Chairman’s letter
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Alioune NdiayeManaging Director
Along 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.
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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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.
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
Message from the Managing Director
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.
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Sonatel 2014 rapport annuel
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1.1 Shareholders’ participation modalities at the General Meeting
The right to attend General Meetings is subject to registration of the shareholder’s name on the share register, five days before the meeting.
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 (or group of shareholders) representing at least one hundred (100) shares may attend or be represented at Annual General Meetings.
Regardless of the number of shares held, shareholders may participate in or be represented at the Extraordinary General Meetings.
Any shareholder may be represented by their spouse or by an agent of his choice, shareholder or not a shareholder himself.
Every shareholder has as many voting rights as shares he owns and represents.
The representative of a shareholder has the voting rights of its mandate under the same conditions and the same limit.
Few words on governance>
GOOD GOVERNANCE PLEDGE FOR TRANSPARENCY
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.
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Sonatel 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.
This example is replicated elsewhere today in many companies.
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.
On 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,• Mr. Abdoulaye Kamara, representing the Financial
Controller.
As of 31 December 2014, the mandates and functions are exercised by nine directors of Sonatel:
Mr. Marc Rennard• Actual mandates and functions within Sonatel:
Chairman of the Board,• Other mandates held in Senegal: none
Mr. Mamadou Aidara Diop• Mandates and functions within Sonatel: Director• Other offices held in Senegal: Director at the Social
Security Fund
Mr. Hugues Foulon• Mandates and functions within Sonatel: Director,
Member of Audit Committee• Other offices held in Senegal: none
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,
1.2 Update on the status of the employee participation in the capital as of 31 December 2014
1.3 Composition of the Board of Directors
1.4 Mandates and functions held by each Director
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GOOD GOVERNANCE PLEDGE FOR TRANSPARENCY1
The 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 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.
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.
Sonatel 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,
• rules 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.
1.5 Conditions of preparation and organization of the Board’s work
1.6 Applying governance codes of the ISA and the SCCP
Mr Fabrice Andre• 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
Mr. Birane Diouf• Mandates and functions within Sonatel: Director• Other offices held in Senegal: none
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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.
The 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 • remuneration, mobility of executives and the Sonatel
employee shareholding policy.
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.
1.7 Principles and rules for determining compensation and benefits granted to corporate officers
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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:
1.8 Total compensation and benefits of any kind paid to each Director
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 800,000 XOF 4,000,000 XOF
Mr. Bernard Ghillebaert *** 4,000,000 XOF 4,000,000 XOF
Mr. Hugues Foulon 3,200,000 XOF 800.000 XOF 4,000,000 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 1,600,000 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
No commitment has been made by Sonatel in favor of its corporate officers for the year 2014.
1.9 Commitments taken in favor of corporate officers
GOOD GOVERNANCE PLEDGE FOR TRANSPARENCY
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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).
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.
1.11 Internal control procedures and risk management in force
The 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.
1.10 Limitations of the Managing Director’s powers
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Mr. Marc RENNARDChairman of the SonatelBoard of Directors
>MEMBER OF THE BOARD OF SONATEL TO 31 DECEMBER 2013
Mr. Mamadou Aïdara DIOPSonatel Director
Colonel Birane DioufSonatel Director
Mr. Thierry BRETONSonatel Director
Mr. Fabrice AndréSonatel Director
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Mr. Hugues FOULONSonatel Director
Mr. El Hadji Abdoul Aziz MBAYESonatel Director
Mr. Abdoulaye KAMARARepresenting the financial
Controller
Mr. Mamadou SARRSonatel Director
Mr. Cheikh Tidiane MBAYESonatel Director
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>EXECUTIVE COMMITTEEGROUP
Mr.Alioune NDIAYEManaging Director Sonatel
Mr. Jean Luc BOHEManaging Director
Orange Mali
Mr. Alassane DIENEManaging Director
Orange Guinea
Mr. Birago Moctar BEYEInternational Operationsand Operators Director
Mr. Abdou Karim MBENGUECorporate Communications and
External Relations Director
Mr. Gana NDOYEHuman Resources Director
Mr. Seydi Ahmed Sy SARRManaging Director
Orange Bissau
Mr. Amadou DEMEDirector of Purchasing
and Logistics
Mrs. NogayeThérèse TOUNKARANetworks and Services
Platform Director
Mr. Aboubacar Sadikh DIOPFinancial and Accounting
Director
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Mrs. Gisèle Pouye GUEYECustomer Service Director
Mrs. Aminata NDIAYEConsumer Marketing DirectorManaging Director of Sonatel
Mobile
Mrs. Afissatou Sall GAYEAudit Risk and Quality
Director
Mr.Jerôme HENIQUEDeputy Managing Director
Mr. Sekou DRAMECorporate Director
Managing Director of SonatelBusiness Solutions
Mr. Omar Gueye NDIAYEStrategy and Development Director,
Managing Director of Sonatel Multimedia
Mrs. Racky Sada WANEInformation Systems
Director
Mr. MamadouIbrahima TRAORE
Executive Sales Director
Mrs. Rokhaya GUEYERegulatory and Legal Affairs
Director
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Sonatel 2014 rapport annuel
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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
Sonatel 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.
Professionalization certificate course was organized for the teams, to both technical, commercial, marketing and communication. This has significantly improved the service provided to customers.
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.
transformation of human capital to meet Sonatel strategic challenges >>
HUMAN RESOURCES
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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.
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 2
The Sonatel group launched in 2013 the co-construction 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.
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 :
• By our employees as the benchmark company attracting the best skills;
• By our customers as best than all our competitors by offering services of quality among the best international standards;
• By our shareholders as a successful player with a significant potential residual growth;
• By institutional as a global operator backed by a world-class operator whose processes are trouble-free in view of international standards: Quality, Safety and Environment;
• By 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.
Sonatel is already a long story, but it’s also a promise, it is a future.
Pursuit of the Enterprise Project sites «United toward 2016» to carry out the necessary Sonatel transformations
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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.
generalization Card O ‘: an innovation to facilitate access to care for employees
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.
Sonatel 2014 annual report of activities
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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
The 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.
SONATEL’S CITIZEN ENGAGEMENT
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D4D: Orange big data competition open to the scientific communityDakar 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.
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.
Sonatel, with its Orange brand, Telecommunica-tions Partner of major events in Senegal contri-buted to the success of the fifteenth World Sum-mit 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 accompaniment is also done through sponsorship with four projects supported by Sonatel Foundation:• «Words, diversity, Art and Dialogue» of Ago-
ravia;• «Franco Phonons» of the GIE Goorgoorlou;• the preparatory forum of youth and women
of the United childhood in the heart of Sine-Saloum 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.
Fifteenth Summit of the Francophonie: Sonatel, the first partner for telecommunications services
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SONATEL’S CITIZEN ENGAGEMENT3
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.
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;
• The 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).
«a student - a computer» program to connect the students’ computers
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 li-ving conditions for a «better be» sustainable social.
Among the actions carried out this year by Sonatel Foun-dation included:
3.2.1- Health: actions in six priority areas
Having at heart the preservation of the health of popula-tion, 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.
Some major achievements in 2014:
Two buses for the Diamniadio Children’s Hospital: Sonatel Foundation used the occasion of the presenta-tion of his Annual Report to provide two buses with a
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 disabili-ties: 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 Sa-nitary District (Region of Louga), Birkilane Sanitary Dis-trict (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 im-prove their conditions of study.
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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. Ous-seynou 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.
state of the art equipment for the health district of MekheSonatel 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. education: 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 EditionTrue 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.
mobilization against Ebola
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digital education: 72,000 beneficiaries, 30 schools in SenegalLa 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.
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 PodorSonatel 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 com-munity. It aims to facilitate exchange between farmers,
producers, development agents and universities, ena-bling them to benefit from the scientific community to get a better return on their work.
encouragement of vocations in the mathematical and telecommunications sciencesSonatel 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 encou-rage vocations among students in the field of telecom-munications.
3.2.3 promotion of Culture in Senegal
Sonatel Foundation participates in the promotion and spread of culture in Senegal by supporting related ac-tions:• 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 Birki-lane department in Kaffrine region (245 km from Dakar).
The village of Thicate Wolof which polarizes other 14 vil-lages with a total population of about 3,000 inhabitants has been designed with the following components:
• 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.
SONATEL’S CITIZEN ENGAGEMENT3
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> the Senegalese market
4.1 mobile Orange has captured over 76% of market growth in 2014
The year 2014 was marked by growth in mobile cus-tomer base by 9%. At the end of the year, Orange subscribers’ base has more than 8,097,000 cus-
tomers.
Orange has captured over 76% of the growth of the mo-bile market in 2014, the rest is shared by its two compe-titors.
Thus, the mobile penetration rate of the population is at 106% at end-December 2014.
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 in-ternet 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 re-flects the many innovations to benefit customers noted during the year include:
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 cus-tomer earns points for each top (100 Xof = 1 point). He consults his points balance via the # 221 #.
OUR ACTIVITIES
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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 TonesDalal 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 .
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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4.2 fixed-lines and Internet: development of uses
home and Home +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 +.
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.
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.
OUR ACTIVITIES4
Mobile banking: Orange Money is pursuing its development and innovation
Sonatel continued his innovations in the field of mo-bile 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 pos-sibility of diversion.
• country benefit: increase of banking rate and re-ducing 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 possibi-
lity of diversion, better accounting, innovation.• country benefit: increased banking rate and re-
duction 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 ac-count to their account BICIS and vice versa.• customer benefit: fill its OM account or BICIS ac-
count 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 insu-
rance
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innovation• camp code: making co-innovation services, by en-
couraging 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 com-pany MLouma was awarded through its project de-signed to facilitate farmers’ selling their agricultural products ...
• mobile applications (Senmap, Senkiosk, etc.) pour permettre aux populat(Senmap, Senkiosk, etc.) to en-able people the geolocation of services (pharmacy,
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 better addressing SMI/SMEs with the doubling of the number of spaces Pro
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 sim-plify the customer experience in receptions with strong representation of clients or business prospects. Cus-tomers pro and consumers have different queues.
This strengthening of Pro spaces was accompanied by a field presence with shares of promotions and anima-tion 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 cus-tomers because it allows them to control their consump-tion 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 OrangeOrange Business Services has launched this year the first cloud computing offer to the Senegalese market and the sub-region. Orange Cloud Pro enables compa-nies to connect via a portal and access web services to a variety of applications: ERP with Sunu ERP, collabo-ration 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.
Orange day has become a familiar annual ap-pointment 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 cus-tomers, 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.
8th edition of Orange day: all mobilized for our customers
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OUR ACTIVITIES4
To save time spent searching for nearby pharmacies on duty and gi-ven the very high penetration rate of mobile phones in Senegal, Sona-tel 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 fa-cilitate their access to information on pharmacies on-duty via the mo-bile. 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 on-duty on their area.
Sen Health Pharmacy: an innovative solution for access by SMS to pharmacies on-duty
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 prio-rity project of Happy pro-gram.
Notable progress was noted this year with the level of implementation of the program Happy and the COPC Project reflecting encou-raging progress towards the achievement of high-per-formance target benchmarks referred by Sonatel’s Customer Service for Markets related to Consumer, Pro-fessional and Enterprise.
We can mention among the major and structuring ac-tions 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 imple-mentation of COPC communication plan, training and
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 high-tech tools: including WFM (forecast on call flows), Verint (transaction monitoring), Hot Survey (hot-satisfac-tion survey), Proactive Contact Voice (recall of clients), InfoMart (Reporting), Knowledge Base, Portal (Front Of-fice applications interface), Full SIP.
strengthening of prevention of the malfunc-tioning approach: with the Steering of 4 Groups for Quality Improvement on the impinging on malfunctions and / or recurring, entertainment prevention device (pi-lot 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.
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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 strengthe-ned to ensure that everywhere and all the time the availa-bility 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 impro-vement 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 vil-lages covered over the 18,000 Mali counts.
• 1,300 site radios built to date.• 3,000 km of optical fiber deployed to the improved ac-
cess 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 du-
ring the security crisis in the north of the country
investments in human resourcesOrange 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.
investments into the economy of MaliThere 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 inclusionLess than 7% of the Malian population has a bank ac-count. Orange Money has enabled many Malians to be-nefit 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, indivi-duals 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 so-lutions for professionals and businesses, SMEs, NGOs and institutional institutions.
mobile: nearly 19% increase in CA VoiceWith a country coverage rate of over 83%, we are wor-king 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 bu-
siness
> Our subsidiaries abroad
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fixed-lines: Call at lower costs• The Livebox and Flybox also allow the homes’ equip-
ment 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 li-vebox phones)
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 connec-ted to our network in 2014• Orange Mali has a wide range of tablets and smart-
phones: 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 vi-sitors 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 collec-
tors in two regions, which data back every day on the price of 12 agricultural products;
• Farmers can have the information in French and Bam-bara on all their queries daily: planting methods, seed sowing time, fertilizer ...
• Number: 37333, price: 50 XOF / min;• USSD menu: # 222 #, fee: 75 XOF / query.
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.
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 citizen actions: transform the lives of Malians
volunteering and demanding corporate social res-ponsibility policyThe Corporate Social Responsibility reflects our consciousness, our desire to ensure the most positive im-pact possible on the people, society and the environment.• More than 350 solar sites installed to prevent thou-
sands of tons of CO2 emissions each year;• 1,879 remote villages connected through community
phone Djamaa Phone;• Support of the development of ICT: GSM equipment
donations for the opening of 2 GSM laboratories in schools UFTI and ENI;
• Entrepreneurship Support: 62 Malian files were sub-mitted to the Orange Prize for Social Entrepreneurship in Africa, launching an incubator project;
• Dialogue with the people of the Diaspora «connected migrant « in Bamako, Kayes and Paris.
OUR ACTIVITIES4
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Orange Mali Foundation: 10 years of social needed actions to create more solidarity ...
... in the field of health300 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 di-
sadvantaged backgrounds;• Support for the literacy project of 540 women in Yeli-
mane;• 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 MaliFor 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, basket-ball 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).
This performance is based on the extension of coverage into new areas, densification in urban areas and bu-siness 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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These investments have mainly allowed:• To develop the network coverage by opening up seve-
ral 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;
The development of consecutive market to these invest-ments enabled Orange Bissau:• To strengthen its contribution to state revenue:• + 5.01 billion XOF were paid for taxes, taxes, fees, so-
cial security contributions and customs duties, repre-senting 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 (whole-salers, 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 ba-lance of Guinea Bissau.
4.7.2 The basis of a strong CSR policy
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 show-case the Carnival beyond the borders, in webcasting the highlights of the event.
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 ob-servers during the election campaign.
• social welfare activities for underprivileged child-ren: 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.
OUR ACTIVITIES4
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5.1 modernization of the mobile network 5.2 flow rates increase for 3G
Sonatel 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 sup-port the 4G. These new facilities have reduced the energy consumption to contribute to Sonatel’s environmental po-licy.
This project also allows the introduction of 3G technology 900 that favors the development of the mobile data network.
641 sites were able to be upgraded in 2014 mainly in the regions of Ziguinchor, Sédhiou, Kolda, Tambacounda, Ké-dougou, Kaolack, Louga, Saint Louis, Thies and Kaffrine. The program will continue until 2016 and will cover the en-tire Sonatel mobile network.
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.
5.3 4G test in Senegal succeeded in Sonatel
The pilot LTE (4G) was held in 2014 consolidating Sona-tel leading position in the Data Mobile and corporate on the cutting edge of telecommunications technology.
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).
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.
Orange, leader on technical service quality>
NETWORKS AND INFORMATION SYSTEMS
Sonatel 2014 annual report of activities
46
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 technologi-cal innovation. For example, we equipped all the Franco-phonie 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 expe-rience 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, com-
bining 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 compu-ting 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
HD for example videoconferences on your mobile, with excellent image quality and sound and the option pre-mium 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 pre-requisites: mobile TV, mobile Internet (browsing, strea-ming), E-mail on the move, Business Everywhere, Inter-net Everywhere BlackBerry , etc.
5.4 evolution of IP core network, mobile voice, national and inter-national transmission and service platforms
The network has experienced many other important de-velopments during this year:• Modernization of multiservice IP core network in all
areas with high traffic potential for migration or strate-gic «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 plat-form with advanced features and a full IP headend.
• Modernization of the transmission network with repla-cement 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 un-derway 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 ac-cess at lower cost to a range of rich Cloud ser-vices.
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
49
securing bandwidth
As part of its bandwidth Internet security policy, Sonatel has participated in the Upgrade 4 of SAT3 with an in-vestment 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 Ge-neral 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 Ran-cy (France) retain their posts respectively Director of the Office of Development of Telecommunications and Di-rector of the Office of Radio communication.
The 48 seats of the Council of the Union have been re-newed 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 Tele-communications, 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 recommen-dations 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 inter-national 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 confi-dence 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 re-maining 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 deploy-ment 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. Effec-tive 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.
SONATEL ABROAD
Sonatel 2014 annual report of activities
50
digital Passage TNT Project
Sonatel accompanies the Group Excaf in the implemen-tation of TNT with the provision of telecommunication of transmission links and national and international publi-city, 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.
pilgrimage to the holy places (Mecca and Christians).
Sonatel as every year accompanied the Senegalese pil-grims to the pilgrimages to holy places.
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 com-petitive.The same model was also deployed on all countries of the Christians Pilgrimage roadmap (France, Italy and Israel) in collaboration with our partners.
A powerful tool was acquired to test the level of real-time quality of service throughout the duration of these pilgri-mages.
Sonatel 2014 annual report of activities
annual report of activities Sonatel 2014
53
key figures and Sonatel share in the stock exchange>
FINANCES
54
Orange Bissau
mobile, Internet, data
Sonatel : integrated telecommunications operator
Orange Mali
89.37%
Orange Guinea
70.05%
90%
Sonatel SA (fixe, data, Internet)
8%
42%
23%
27%
employees
Orange
float
Republic of Senegal
annual report of activities Sonatel 2014
100%
Mobile
Sonatel Mobiles
Sonatel BusinessSolutions
Business Solutions
Sonatel Multimedia
Internet
GDP 4%inflation 1.6%penetration 105.7%position 1st/3 market share 58%
Sen
egal
GDP 2,9%inflation 11.8%penetration 73%position 2nd/6market share 51%
Gui
nea
GDP 4.8%inflation 1.8%penetration 122%position 1st/3 market share 54%
Mal
i
GDP 3.5%inflation 1.7%penetration 60%position 2nd/2market share 48%
Gui
nea
Bis
sau
strong and dynamic market positions: strengthened positions in all our markets
fixed line– mobile – internet – leased lines – TV adsl – Orange Money
56
Sonatel
Orange
strong and dynamic market positions : strengthened positions in all our markets (next)
subscribers 2012 2013 2014 r 2013/2012 r 2014/2013
fixed line 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%
strong growth still driven by the mobile business
annual report of activities Sonatel 2014
2012 2013 2014 r 2013/2012 r 2014/2013
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%
total 17 911 057 22 000 003 25 942 396 23% 18%
subscribers per country
Senegal
Bissau
Guinea
Mali
31.2%
2%17.4%
49.4%
sustained development of mobile subscriber base
base (thousands)
more than
26 million subscribers
2012 2013 2014
282
7 118
8 582
1 850
361 293 284
7 462
10 822
3 239
477
8 098
12 826
4 506
513
fixe mobile Senegal mobile Mali mobile Guinea mobile Bissau
58
turnover breakdown per activity
liaison louées et autres
-20%
-10%
-15%
-5%
-0%
30%
15%
25%
10%
20%
5%
66%
5%
mobile
fixe line 5%
domesticinterconnexion
3%
internationalinterconnexion
19%
other wholesale2%
internet
data & leased line internet 1%
evolution 2014/2013
contribution & evolution in 2014
2011 2013 2014
52%
39%
27%
53%
37%
24%
2012
52%
38%
26%
51%
37%
26%
net margin operating margin Ebitda margin
group margins remained at high levels
annual report of activities Sonatel 2014
120 118 116
135
sustained investment to
17% of turnover
2011 2012 2013 2014
expansion and densification in 2G and 3G network in Guinea (128 sites) and Guinea Bissau (57 websites)
development of mobile internet
improving the quality of technical service and innovation
capex
good cash generation and low leverage
2011 2012 2013 2014
equity 592 596 613 655
debt 40 26 15 3
debt ratio 6.8% 4.4% 2.4% 0.5%
(in Xof billion)
equity debt
2011
40
592
2012
26
596
2013
15
613
2014
655
3
60
free cash flow debt
2014
292
3
2013
15
263
2012
26
229
2011
40
215
2011 2012 2013 2014
free cash flow 215 229 263 292
debt 40 26 15 3
debt ratio 14.4% 9.5% 5.1% 0.9%
good cash generation and low leverage (next)
a key contributor to the economies of the countries of presence
more than 374 billion XoF paid for taxes, fees, royalties, payroll taxes, customs fees and dividends of which
more than 215 billion XoF from Senegal, 107 billion XoF from Mali, about 46 billion XoF from Guinea and near 6 billion XoF from Bissau
more than 218 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
more than 100 000 indirect jobs thanks to a wide commercial distribution network and dynamic partners,
more than 3,000 direct jobs
nearly 173 bil-lion XoF were generated in contribution to the states balance of payments trough our international activities with foreign operators of telecommunica-tions
net exports of more than 98 billion XoF from Senegal, 72 billion XoF from Mali,19 billion XoF from Guinea and 10 billion XoF from Bissau
Stat
es b
udge
t rev
enue
s
Priv
ate
sect
or co
ntrib
utio
n
Job
crea
tion
expo
rts
creation of wealth : driving force of economical development
annual report of activities Sonatel 2014
2011 2012 2013 2014 r 2013/2012 r 2014/2013
Senegal 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%
total 2 565 2 663 2 618 2 690 -1.7% 3%
staff
record value of Sonatel share : continuing performance
25 000
monthly average stock price
dividend 2013
interim results
+ 2 700 Fcfa
peak of the month
-2 300 Fcfa
+9 000 Fcfa
stock split25 000
24 000
22 500
21 000
15 000
23 000
20 000
20 000
12 500
22 000
17 500
19 000
10 000
Jul.-
12
dec.
-12
dec.
-13
dec.
-14
dec.
-14
aug-
12
jan.
-13
jan.
-14
sep.
-12
sep.
-13
sep.
-13
sep.
-13
feb.
-13
feb.
-14
feb.
-14
oct.-
12
oct.-
13
oct.-
14
oct.-
14
mar
.-13
jan.
-14
mar
.-14
mar
-14
nov.-
12
nov.-
13
nov.-
14
nov.-
14
apr.-
13
apr.-
14
apr.-
14
may
-13
may
-14
may
-14
jun.
-13
jun.
-14
jun-
14
jul..
-13
jul.-
14
jul.-
14
aug.
-13
aug.
-14
aug.
-14
Share price record in closing at 24,600 CfaF
25 000 during the 1st trimester
Fcfa
62
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(in billion cfaF)
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%
generous and reliable dividend policy
annual report of activities Sonatel 2014
63
chiffres clés
note to the readersThe 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.
> financial report 2014
introductionThe 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,
Sonatel 2014 annual report of activities
64
• 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
663
4.4%
738
11.4%
816
10.5%
2012 2013 2014 r 14/13 r 13/12
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%
in xof billion
annual report of activities Sonatel 2014
65
Economically, a slight improvement in environment accompanied by a stabilization of the political si-tuation 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 re-
covery 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 com-pared 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 of-
fers (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 ca-pacity via the new submarine cable ACE,
• The willingness of the Government to intervene in the sector while demanding more contribution of opera-tors 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 resump-tion of cooperation with Mali,
• threat of the epidemic «Ebola» but with little effect on the economy.
The telecommunications sector was marked in the mo-bile 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 mar-ked 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 re-cruitment supported by a network deployment program (187 sites open in 2014 with 128 new locations) and ani-mations 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 pro-gressive resolution of the social crisis of the first semes-ter 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.
1. Economic and regulatory environment
Sonatel 2014 annual report of activities
66
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:
• budget 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,
• development of the private sector: more than 218 billion XOF of turnover generated for the benefit of local bu-sinesses, including more than 132 billion turnover for en-terprises 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 dy-namic commercial distribution partners and 3,000 direct jobs,
• exports: 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,
• Sponsorship 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 elements2.1 Subscribers’ base: 26.3 million customers,
representing 17.5 percent growth
In 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 mil-lion 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 mea-sures to identify subscribers. These same measures re-lating 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 fixed-lines deals (home and home plus).
2012 2013 2014 r 2013/2012 r 2014/2013
fixed line 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%
total 18 301 170 22 419 376 26 346 949 23% 18%
annual report of activities Sonatel 2014
67
The subscribers’ base by country is analyzed as follows:
Senegal
mobileCompared 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 re-corded 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 subscri-bers).
fixed-lines / InternetThe 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 of-fers on the 3 G amplified by the popularization of smart-phones 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
mobileThe mobile Subscribers’ base Orange Mali amounted to 12.8 million subscribers, up + 18.5 percent, an increase of recruitment (+ 2 million subscribers).
This strong growth, achieved in a very competitive en-vironment is due to the many promotions on sim activa-tions and the market animation for recharging with an acceleration of the frequency and levels of bonuses of-fered.
fixed-lines / InternetThe 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 Inter-net compared to 2013 thanks to new offerings «Flybox», «Sénékela», «mobile internet package for others» and reopening of bank branches for VPN offers.
Guinea
mobileOrange 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, consoli-dating its leading position in the Guinean market in both volume and value.
subscribers per country
Senegal
Bissau
Guinea
Mali
31.2%
2%17.4%
49.4%
2012 2013 2014
282
7 118
8 582
10 822
12 828
1 850
361 293 284
7 462
3 239
477
8 098
4 506
513
mobile Guinea Bissaufixed line mobile Senegal mobile Mali mobile Guinea
(thousands of subscribers)
Sonatel 2014 annual report of activities
68
2.2 traffic: evolution of in-coming and out-going national mobile traffic, international traffic by country.
Guinea Bissau
mobileOrange 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.
91284248
207243305
outgoing national mobile traffic
2012 2013 2014
1659 19982144
222 214 253
outgoing national mobile traffic
2012 2013 2014
961 1723 3110
377 372 369
outgoing national mobile traffic
2012 2013 2014
170266
396
19 16 15
outgoing national mobile traffic
2012 2013 2014
Orange other operators
incoming national mobile traffic
incoming national mobile traffic
590
2012
610
2013
589
2014
incoming national mobile traffic
365
2012
364
2013
399
2014
incoming national mobile traffic
299
2012
301
2013
319
2014
incoming national mobile traffic
13
2012
16
2013
24
2014
outgoing from Senegal incoming international traffic
international traffic
499206
535
241533
233
2012 2013 2014
international traffic
2012
332
859
2013
361
837
2014
344
791
international traffic
2012 2013 2014
85144
116174
136172
international traffic
2047313322 27
2012 2013 2014
4901
annual report of activities Sonatel 2014
69
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).
The exponential growth of outgoing traffic (+ 4,191 mil-lion minutes) confirms the de-correlation increasingly pro-nounced with mobile turnovers (+ 2.5 percent), or 32 times less than the increase in usage.
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, re-flecting the decline in value caused by the development of abundance.
fixe-line Senegal
The fixed-lines outgoing traffic totaled 267.7 million mi-nutes 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 conver-gence 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 mi-nutes. This decrease in international incoming traffic is
due to the residual effects of SIM box fraud and the de-velopment of alternative channels (VoIP).
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.
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 national incoming traffic (third party mobile opera-tors) 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 expe-rienced 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 mil-lion minutes, regularly linked with unlimited offers made to customers during weekends.
Sonatel 2014 annual report of activities
70
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.
average monthly arpu 2012 2013 2014 r 13/12 r 14/13croissance
du parc
Senegal (cfaF)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%
2011 2012 2013 2014 r 13/12 r 14/13
Senegal 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%
Sonatel 2 565 2 663 2 618 2690 -1.7% 3%
Furthermore, the positive development of refills (+ 10 percent growth in turnover for the mobile business) re-sults 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 mil-lion 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 mi-nutes of national traffic minutes which rose from 16.1 mil-lion to 23.6 million minutes.
2.3 Average revenue per user (ARPU)
A decline in prepaid ARPU was noted in all countries re-sulting induced effects of increased largest subscribers’ base that changes in income recorded over the period.
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 (mo-
bile 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 pre-servation 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.
annual report of activities Sonatel 2014
71
In 2014, Turnover by country divided as follows:
• Senegal 52%
• Mali 32%
• Guinea 14%
• Guinea Bissau 2%
Guinea Bissau15
Senegal425
Mali261
Guinea116
in xof billion
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.
Sonatel 2014 annual report of activities
72
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
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.
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73
Mali
The social turnover of Orange Mali amounted to 271.8 billion XOF. It grew by + 18.9 percent over 2013.
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)
international interconnection
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.
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.
Senegal300 000
200 000
100 000
fixed line
internet
international interconnection
mobile
domestic interconnection
other wholesale (internet & data)
Mali200 000
150 000
50 000
100 000
0
fixed line
internet
international interconnection
mobile
domestic interconnection
other wholesale (internet & data)
Sonatel 2014 annual report of activities
74
Guinea100 000
80 000
40 000
60 000
0
fixed line
internet
international interconnection
mobile
domestic interconnection
other wholesale (internet & data)
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 inter-connection (+ 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 subscri-bers 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 bu-siness deals.
international wholesale
With a turnover of 12 billion in 2014, international inter-connection recorded a growth of 24 percent or + 2.4 bil-lion 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 re-corded a growth of 0.5 billion primarily on operator roaming.
domestic interconnection
Turnover from domestic interconnection totaled 5.1 bil-lion in December 2014, an increase of 0.6 billion com-pared to 2013, in correlation with the increase in volumes received from competitors + 6 percent (+18.5 million mi-nutes).
annual report of activities Sonatel 2014
75
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.
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
Guinea Bissau15 000
10 000
50 000
0 fixed line
internet
international interconnection
mobile
domestic interconnection
other wholesale (internet & data)
Sonatel 2014 annual report of activities
76
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 Bissau, the decrease of 0.2 billion was mainly driven by international payouts.
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.
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 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.
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
77
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.
Training costs increased by 0.4 billion (0.3 billion in Senegal and 0.1 billion in Mali).
Operating water and energy also increase to 0.4 billion driven by the 0.3 billion in Mali and 0.1 billion in Guinea.
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..
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.
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.
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.
The group EBITDA grew by 13.1 percent compared to last year (+ 49.7 billion).
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.
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.
Sonatel 2014 annual report of activities
78
3.4 operating 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.
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.
3.5 financial income
Consolidated financial result of the Group is 3.6 billion, up by 3.8 billion from 2013.
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
79
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.
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).
Senegal
Senegal network investments representing 82 percent of total budget, increased by 5 billion (+ 13.9 percent) com-pared 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 deploy-ment 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 allo-cated in the following areas:
Access Network: the accomplishments of an amount of 1.8 billion largely concerning the expansion, the rehabi-litation of wired access network and the serving of new subdivisions. The achievements have focused on:• Moving wire works to address the risk of network down-
time 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 un-derground development of long overhead cables,
(in xof billion) 2012 2013 2014 2014-2013 r 14/13 r 13/12
Senegalnetworkothers
483513
513615
50419
-1+5-6
-1%14%-38%
6%2%
15%
Malinetworkothers
44396
38335
44404
+6+7-1
16%22%-24%
-16%-16%-15%
Guineanetworkothers
21201
23222
36342
+13+12
-
54%58%5%
8%7%
30%
Bissaunetworkothers
431
431
651
+2+2-
47%56%-12%
-2%11%-43%
totalcapex rate
11818%
11616%
13517%
+1917%+1pt
-2%-2pts
Sonatel 2014 annual report of activities
80
• 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 mana-gement 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 hierar-chy north, center and south).
collection: these projects executed in the amount of 6 bil-lion concern the project FH Ran Renewal (2.6 billion XOF), the fiber collection (2.2 billion XOF), obsolescence ma-nagement and secure broadband (818 million XOF) and VSAT hub extension (139 million XOF).
other projects: the achievements amounting to 1.5 bil-lion 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 bil-lion, 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 inclu-ding:• 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
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 environmentThe 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 im-provement by reducing the proportion related to energy and the environment. They focused on the upgrade of batteries life, the renewal of generators’ park, AES, inver-ters, 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 invest-ments. They focused again mainly on the 3G program with the densification of 3G in Bamako to strengthen lea-dership 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 swit-
ching equipment, intelligent network and Gprs ser-vices 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 ge-nerators.
• Information system: 1.4 billion XOF invested in the pur-chase 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
81
Guinea
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 in-vestments are mainly devoted to energy for 6 billion XOF (12.4 percent of increase compared to 2013), the buil-ding of sites for 6.2 billion XOF (13.9 percent increase compared to 2013) and core network for 4.7 billion XOF.
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 exten-sion of HLR subscribers’ licenses
• Transmission: securing the loop and the purchase of 10 routers,
• site construction: acquisition of 98 pylons and dismant-ling of some pylons in urban areas for their redeploy-ment 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 strate-gic sites and QoWiso project.
Off-network projects were:• the development of new agencies, including that of Ka-
loum, new receptions and works in new buildings,• Projects Information Systems (Project backup and vir-
tualization).
Guinea Bissau
Bissau network investments amounted to 5.3 billion XOF and focused on:
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 densi-
fication program and networks extension in 12 new 2G sites in Bissau and the regions,
• 15 upgrades and 11 swaps bonds in Bissau and re-gions,
• 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 com-
puter,• the purchase of three vehicles primarily for technical
and business needs.
Sonatel 2014 annual report of activities
annual report of activities Sonatel 2014
83
financial statements>LESANNEXES
Sonatel 2014 annual report of activities
84
asset gross amort/prov 31/12/14 31/12/13
fixed assets
fixed charges 17 17 7
intangible assets 159 924 131 406 28 519 33 979
goodwill 0 0 0 0
other intangible assets 159 924 131 406 28 519 33 979
tangible assets 1 378 369 848 009 530 360 495 764
advances and installments paid on fixed assets 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
participations and linked debts 7 436 583 6 853 6 468
loans and other financials assets 110 900 316 110 584 104 254
total (I) 1 670 176 980 314 689 862 653 678
current assets
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
audit of financial statements: asset(in millions Xof)
annual report of activities Sonatel 2014
85
audit of financial statements: liability
(in millions Xof)
liability 31/12/14 31/12/13
equity
equity 50 000 50 000
additionnal paid-in capital and consolidated reserves 347 742 337 010
conversion variance 2 249 -832
net result (part of consolidated company ) 191 991 168 329
other equity 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
financial debts and assimilated resources
differed taxes 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
current liabilities
accounts payables and related accounts 182 606 151 355
other debts 207 489 166 534
total (II) 390 095 317 889
liabilities-cash flow total (III) 27 271 54 002
total liabilities 1 117 894 1 041 625
Sonatel 2014 annual report of activities
86
consolidated income statement 31-dec-14 31-dec-13
turnover 816 019 738 314
stocked production 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
ordinary activities result 319 541 273 244
o.o.a. result 226 -3 913
result before tax 319 768 269 331
tax due on result 103 408 89 331
differed tax 1 855 9 635
net result of integrated company 218 215 189 635
share in net income of equity affiliatesiequity-accounted investments companies
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
audit of financial statements: consolidated income statement(in millions Xof)
annual report of activities Sonatel 2014
87
financial table of resources and funds : tafire 1
(in millions Xof)
1st part: determination of financial balances for fiscal year 2014
working capital need changes (n.w.c.)
global cash-flow (GCF)
amount (Xof million)
amount (Xof million)
EBE 426 234
(SA) financial fees 2 309(TT) operating expenses transfer
3 342
(SC) exchange rate loss 2 207
(SL) expenses outside ordinary activities 1 (UA) Financial income 5 534
(UE) Financial expenses transfer
1
(SQ) participation 0 (UC) Exchange rate profit 2 096
(SR) income tax 103 408(UL) Outside regular activities products
0
(UN) Outside regular activities expense transfer
0
total (I) 107 925 total (II) 437 207
change N.W.C.= inventory change + debt changes + notes payable changes
stock change n -(n-1)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
financing from cash flow (a.f.)
dividends distributed during the fiscal year 177 681
AF= GCF – dividends distribution during the fiscal year 151 601
GCF: Total(II) - Total(I) 329 282
Sonatel 2014 annual report of activities
88
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 receivablesuses
(increase +)resources
(decrease -)
suppliers, paid advances 0 362
customers 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
operating cash surplus (OCS)
OCS = GOP – NWC CHANGES – Self constructed assets 2014 2013
E.B.E. 426 234 383 174
- changes in NWC 65 706 38 586
- self constructed assets -2 288 -2 361
O.C.S 489 652 419 399
changes in debtuses
(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
conversion variance - liabilities 0 1 533
contingency provisioned 137 0
total 1 047 67 506
(C) global net change in debt 0 66 459
change in NWC=A+B- C 0 65 706
annual report of activities Sonatel 2014
89
financial table of resources and funds : tafire 2
(in millions Xof)
2nd part: determination of financial balances for fiscal year 2013
fiscal year 2014 fiscal year 2013
use resources 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
external growth
purchases/transfers of financial assets 25 280 19 413 -47 558
investissement total 141 178 0 -158 756
II- changes in operation working capital need 0 65 706 38 586
A- economic uses to be financed FF+FG 75 472 0 -120 170
III- uses/resources (B.F.; H.A.O.) 0 9 535 6 769
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
V- internal financing
dividends (uses) / CAFG (resources) 177 681 329 282 125 277
VI- equity financing
increase in equity by new contribution 0 0
investments from grants 0 0
equity withdrawals 0 0
Sonatel 2014 annual report of activities
90
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 +
VII- financing by new loans
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
VIII - cash variation
net cash
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
control (based on N and N-1 balance sheet volumes)use
12/31/2014resources
12/31/2013
working capital change (WC): WC(N) - WC(N-1) 4 958 0
NWC change: NWC(N) -NWC(N-1) 0 75 241
cash change (T) T(N)-T(N-1) 70 282 0
total 75 241 75 241
annual report of activities Sonatel 2014
91
audit of financial statements: table of changes in equity
(in millions Xof)
initial balance before
distribution
capital social other
account to
account Transfer
final ba-lance after distribu-
tion
emission d’actions
distri-bution in kind
cash contribu-
tion
incor-porated reserves
de-crease
increase decreaseconver-
sion variance
equity 50 000 50 000
issuance, merger, contribution premium
3 577 244 3 822
re-evaluation variance
-832 3 082 2 249
legal reserve 18 162 18 162
statutory and contractual reserves
0 0
other reserves
354 540 903 0 6 247 361 689
carried over balance
-1 673 0 -70 2 626 884
previous year result not yet allocated
0 0
result of the year
189 635 218 215 -177 681 -11 955 218 215
investment grants
0 0
regulated provisions
0 0
0 0
total 613 408 0 0 0 0 219 118 -177 681 175 0 655 020
Sonatel 2014 annual report of activities
92
audit of financial statements: table of changes and consolidated debts details (in million Xof)
balancebeginningof year (1)
incurred debt (2)
payments (3)
incorporatedto equity (4)
netconversionvariance (5)
other movments
(6)
balance end of year (7)
collateralof secured
debts
convertible bonds debts
other bonds debts
loans and debts credit institutions
10 018 123 9 005 10 1 145
various financial loans and debts
5 408 7 166 13 609 2 812 0 1 777
total 15 426 7 289 22 614 0 2 822 0 2 922
off-balance sheet financial commitments
commitments
given received
(1) (1)
secured commitment
with real collaterals 1 211
other security commitments 4 055 3 864
mutual commitments
in terms of Leasing
definite orders
annual report of activities Sonatel 2014
93
consolidated financial statements:
turnover breakdown table(in million Xof)
2014 fiscal year 2013 fiscal year
total sales% of
turnovertotal sales
% of turnover
A) sales allocation by activity
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%
fixed terminal sales / Peri-telephony 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%
total 816 019 100% 738 314 100%
B) sales allocations by geographic areas
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%
total 816 019 100% 738 314 100%
Sonatel 2014 annual report of activities
94
audit of financial statements: Workforce Analysis by key categories as of 31 december (in XOF millions)
fiscal year 2014 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
95
Sonatel SA balance sheet : summarized assets
(in XOF millions)
asset
fiscal year 2014 fiscal year 2013
grossdepreciation/
provisionsnet net
fixed assets (1)
fixed chargesset-up costs and deferred charges bond redemption premium
intangible assets research and development charges
patents, licences and softwaregoodwillother intangible assets
tangible assetslandbuildings
installations and fittingsequipmenttransportation equipment
advances and installements paid on fixed assets
financial assetsequity securitiesother financial assets
000
33 83713
33 82300
496 2773 636
36 564
14 940430 32010 817
0
182 38868 175
114 212
30 20513
30 19200
390 0680
16 504
11 055355 3827 128
0
878583295
000
3 6321
3 63200
106 2093 636
20 060
3 88474 9383 689
0
181 51067 593
113 917
000
4 1511
4 15100
101 6143 611
17 124
3 85973 7013 318
0
190 56167 593
122 969
total fixed assets (I) 712 501 421 151 291 351 296 326
current asset
o.o.a. current assets
inventoriesgoodsraw materials and other supplies in progressmade products
receivables and assimilated receivables suppliers, advances paid accounts recievables other receivables
0
3 3290
3 32900
235 9265 391
135 58694 949
0
960
9600
10 5220
10 296225
0
3 2330
3 23300
225 4045 391
125 28994 723
0
5 4160
5 41600
230 8215 570
114 540110 711
total current assets (II) 239 254 10 618 228 637 236 237
assets - cash flow marketable securitieschecks, bills awaiting collectionbank, postal checks, cash on hand
9 36198
123 453
000
9 36198
123 453
3 71194
94 334
total assets- cash flow (III) 132 912 0 132 912 98 139
conversion variance - assets (IV) (probable exchange loss) 242 242 93
general total (I + II + III + IV) 1 084 910 431 769 653 141 630 795
Sonatel 2014 annual report of activities
96
Sonatel SA balance sheet : summarized liabilities (in XOF millions)
LIABILITIES (Before allocation) fiscal year 2014 fiscal year 2013
capital and assimilated resources
capitalshareholders, uncalledd capital
premium and reservesshare, issuance, merger premium re-evaluation variance unavailable reserves free reserves carried forward balancenet income for the period (gain +, loss -_)
other equityinvestment grantsregulated provisions and assimilated funds
50 0000
163 55800
10 000153 558
0173 666
2 0381 241798
50 0000
171 04500
10 000161 045
0147 513
2 1881 390798
total equity (I) 389 262 370 746
financial debts and assimilated resources
loanslease liabilities and assimilated contractsvarious financial debtsrisk and expenses provisions
1 1460
6038 832
9 9090
3937 345
total financial debts (II) 40 038 47 292
total secured resources (I + II) 429 300 418 038
cuurent liabilities
o.o.a. debts and assimilated resourcesclients, received advancestrade supplierstax debtssocial debtsother debtsprovisioned risks
6 217877
59 20072 2169 423
61 048242
7 8481 368
48 66154 7129 742
60 29193
total current liabilities (III) 209 224 182 715
liabilities - cash flow
bank, discount creditbank, cash creditbank, overdraft
00
14 440
025 1344 907
total liabilities - cash flow (IV) 14 440 30 041
conversion variance - liabilities (V)(probable exchange gain)
177 1
general total (I + II + III +IV+ V) 653 141 630 795
annual report of activities Sonatel 2014
97
Sonatel SA income statement summary
(in XOF millions)
fiscal year 2014 fiscal year 2013works, sold services 325 532 316 086
self-constructed assets 1 450 1 500
accessory products 30 110 30 306
turnover 355 643 346 392
operating grants 0 0
other revenues 7 896 4 120
other purchases 9 160 9 684
inventory change 1 651 253
transportation 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
Sonatel 2014 annual report of activities
98
Sonatel SA income statement summary (next)(in XOF millions)
fiscal year 2014 fiscal year 2013
result from ordinary activities 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
workers’ participation 0 0
income tax 45 470 40 982
general total of revenues 456 575 425 164
net result 173 666 147 513
annual report of activities Sonatel 2014
99
Sonatel SA supply and use table (tafire)
(in XOF millions)
GLOBAL CASH FLOW (G.C.F.)G.C.F. =
GOP - Remaining disbursable expenses + Remaining collectable revenues
Change in WCN = Inventory change + debt changes + notes payable changes
G.C.F. = Total (II) - Total (I) = 195 029
financing from cash flow (A.F.)
working capital need changes (W.C.N)
(1) dividends paid during the fiscal year including dividends’ advances.(2) excluding O.O.A. elements.
GOP 159 029
(SA) financial fees 1 377 TT) operating expenses transfer 3 648
(SC) exchange rate loss 443
(UA) financial income 78 676
(SL) expenses outside ordinary activities 1 (UE) financial expenses transfer 0
(SQ) participation 0
(UC) exchange rate profit 967
(SR) income tax 45 470 (UL) outside regular activities products 0
(UN) outside regular activities expense transfer 0
total ( I ) 47 291 Total ( II ) 242 320
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
dividends distributed during the fiscal year 155 000
AF= CAFG – dividends distribution during the fiscal year (1) 40 029
part 1: determination of financial balances for fiscal year 2014
Sonatel 2014 annual report of activities
100
Sonatel SA supply and use table (tafire)(in XOF millions)
Changes in receivables: N - (N - 1)Uses
Increases (+)Ressources
Decreases (-)
(BH) suppliers, paid advances 0 178
(BI) clients 10 749 0
(BJ) other receivables 0 15 987
(BU) conversion variance – assets 149 0
(B) net global changes in receivables -5 268
changes in current liabilities: N - (N-1)Uses
Decrease (-)RessourcesIncrease (+)
(DI) clients, received advances 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
(C) net global change in current liabilities 0 28 316
change in W.C.N.= (A)+(B)+(C) 0 35 766
operating cash surplus (O.C.S.)
fiscal year 2014 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
part 1: determination of financial balances for fiscal year 2014 (next)
annual report of activities Sonatel 2014
101
Sonatel SA supply and use table (tafire 2)
(in XOF millions)
fiscal year 2014
fiscal year2013
uses 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
external growth
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 -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
part 2: supply and use table (tafire)
Sonatel 2014 annual report of activities
102
part 2: Sonatel SA supply and use table (tafire)(in XOF millions)
fiscal year 2014
fiscal year2013
uses ressources (U -; R +)
V. internal financing
dividends (uses)/ C.A.F.G.(resources) 155 000 195 029 27 286
VI. equity capital financing
capital increase with new contributions 0 0
investment grants 0 39
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
other financial debts (2)
C - net financing resources 0 40 220 27 665
D - surplus or insufficiency of financial resources (c-b) 0 50 373 -6 557
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 50 373 0 -6 557
control: D = VIII with opposite signI, 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
change in cash position (T): T(N) - T(N-1) 50 373 0
total 50 373 50 373
annual report of activities Sonatel 2014
103
Sonatel SA financial statements
(in XOF millions)
labelsbalance as of 31/12/13
purchases reclassification retirementbalance 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
research and development expenses 1 0 0 0 1
patents & licenses in process 456 12 -68 0 399
software in process 1 315 955 -1 461 0 809
other rights and intangible values in process 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
general office facilities 3 556 0 0 0 3 556
office equipment 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
adjustments, installations in process 177 46 0 0 222
technical facilities, buildings and arrangements 47 068 4 286 181 32 51 502
table n° 1 : fixed assets change as of 31/ 12/2014
Sonatel 2014 annual report of activities
104
table n° 1: Sonatel SA fixed assets change (next)(in XOF millions)
labelsbalance as of
31/12/13purchases 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
sonatel lines and network equipment 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
operating equipment 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
fixed assets change as of 31/ 12/2014
annual report of activities Sonatel 2014
105
table n° 1: Sonatel SA fixed assets change (end)
(in XOF millions)
labelsbalance as of 31/12/13
purchases reclassification retirementbalance as of 31/12/14
operating equipment in process 82 -4 0 0 79
public switching equipment in process 313 172 -115 0 371
Sonatel equipment in process 1 0 0 0 1
transmission equipment in process 2 846 5 057 -1 604 0 6 298
mobile 2g / 3g network access equipment in process
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
measurement equipment in process 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
fixed assets lettering 425 20 0 0 445
material in process 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
general total 507 210 24 684 0 1 781 530 115
fixed assets change as of 31/ 12/2014
Sonatel 2014 annual report of activities
106
labelsBalance as of
31/12/13Increases Reclassification
Retirement Disposal
Balance on31/12/14
depreciation research development 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
depreciation admin. and commercial buildings
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
depreciation energy equipment 31 371 3 395 0 28 34 737
depreciation access network and equipment
0 0 0 0 0
depreciation network and data equipment 29 739 2 459 0 15 32 184
depreciation other operating equipment 32 3 0 0 35
total 2841 317 352 13 981 0 52 331 279
table n° 2 : depreciation changes 31/12/2014
Sonatel SA financial statements(in millions Xof)
annual report of activities Sonatel 2014
107
Sonatel SA financial statements(in XOF millions)
labelsBalance as of
31/12/13Increases Reclassification
Retirement Disposal
Balance on31/12/14
depreciation office furniture 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
total 2845 7 530 1 084 0 1 487 7 130
depreciation design, fixtures and instal-lations
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
general total 401 446 20 527 0 1 700 420 273
table n° 2 : depreciation changes 31/12/2014
Gross Amount
A
Deprecia-tion
doneB
ValeurNet book value
C = A - B
Disposal price
D
+ Gain- loss
E = D - C
intangible assets 0 0 0 0 0
tangible assets 1 781 1 700 81 165 84
financial assets 0 0 0 0 0
total 1 781 1 700 81 165 84
table n° 3 : gains and losses disposal
Sonatel SA financial statements(in millions Xof)
Sonatel 2014 annual report of activities
108
Sonatel SA financial statements(in millions Xof)
none
tableau n°5 : assets acquired through capital lease and related contracts
nature
a b c d = a+b+c
provision at the
beginning of the year
increases: expenses decreases : reprisesprovision at the end of the yearopera-
tingfinan-cials
outsideordinaryactivities
opera-ting
finan-cials
outsideordinaryactivities
1. regulated Provisions 798 0 0 0 0 798
2. financial Provisions for liabilities and expenses
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 0 8 328 0 0 40 507
4. inventory depreciation 254 96 0 254 0 95
5. depreciation and provisioned
0 0
risks (third party) 11 418 1 357 0 2 011 0 10 763
6. depreciation and provisionned
0 0
risks (cash) 1 0 0 0 0 1
total ii 11 673 1 452 0 0 2 266 0 0 10 860
total ( i ) + ( ii ) 51 110 10 851 0 0 10 594 0 0 51 366
tableau n°4 : provisions written in the balance sheet
Sonatel SA financial statements(in millions Xof)
annual report of activities Sonatel 2014
109
grossamount
analysis by maturities other analysis
at least one year ofbetween 1 and 2 years
at more than 2 years
amounts in foreign currency
amounts to affi-liated
compa-nies
amounts repre-
sented by promissory
notes
which are due
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
receivables from participations 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
clients and associated accounts
135 586 135 586 0 0 0 0 0 0
staff 994 994 0 0 0 0 0 0
social Security and other socal agencies
0 0 0 0 0 0 0 0
state 18 676 18 676 0 0 0 0 0 0
international organizations 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
total (I) + (II) 350 380 266 572 0 13 972 69 836 0 0 0
(1) loans granted during the fiscal year : : 14 156 Reimbursements obtained during the fiscal year : 11 590
tableau n°6 : debts maturities at the end of the fiscal year
Sonatel SA financial statements(in millions Xof)
Sonatel 2014 annual report of activities
110
(1) loans subscribed during the fiscal year : 191 / loans reimbursed during the fiscal year : 8 933(2) total debts owned to shareholders (indivudual persons)
grossamount
analysis by maturty other analysis
at least 1 year
between1 and 2years
at morethan
2 years
amountin foreigncurrency
amountto affiatedcompa-
nies
amountsrepre-sented
by promis-sory
notes
which aredue
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
total (I) 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
current assets - liabilities
suppliers and related accounts
59 200 59 200 0 0 0 0 0 0
clients 877 877 0 0 0 0 0 0
staff 9 010 9 010 0 0 0 0 0 0
social security and social agencies
413 413 0 0 0 0 0 0
state 72 216 72 216 0 0 0 0 0 0
international organizations 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
unearned income 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
tableau n°7 : debts maturities at the end of the fiscal year
Sonatel SA financial statements(in millions Xof)
annual report of activities Sonatel 2014
111
Sonatel SA financial statements(in millions Xof)
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
tableau n°8 : intermediary consumptions of the fiscal year
Sonatel 2014 annual report of activities
112
concerned exercices (1) nature of indication
2014 2013 2012 2011 2010
capital structure at the end of the year (2)
authorized capital 50 000 50 000 50 000 50 000 50 000
common shares 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
operationel income of the year (3)
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
workers’ contribution to profits 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
income per share
distributed income 5) 160 000 155 000 150 000 145 000 140 000
dividend allocated to each share (in xof) 1 600 15 500 14 500 14 500 14 000
staff and wages policy
average number of workers in the period (6) 1 752 1 821 1 850 1 815 1 824
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.
tableau n°9 : income allocation and other particular elements of the last five years
Sonatel SA financial statements(in millions Xof)
annual report of activities Sonatel 2014
113
allocations amount (1) origins amount (1)
legal reserve 0previous 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
other allocations 0
balance carried forward 0
total (A) 173 666 control :total A = total B 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
tableau n° 10 : 2012 fiscal year income allocation project
Sonatel SA financial statements(in millions Xof)
Sonatel 2014 annual report of activities
114
wages (in million XoF)
localsother
countries of ECOWAS
outside ECOWAS
total locals
other coun-tries of
ECOWAS
outside ECOWAS
total
M F M F M F M F M F M F
qualifications
employed staff
1. Senior Executives
609 316 0 0 4 0 929 18 450 9 574 0 0 1 987 0 30 011
2. Senior Technicians and middle managers
335 262 0 0 0 0 597 10 149 7 938 0 0 0 0 18 087
3. Technicians, Supervisors and skilled workers
150 40 0 0 0 0 190 4 544 1 212 0 0 0 0 5 756
4. Employees, laborers, workers and apprentices
38 1 0 0 0 0 39 1 151 30 0 0 0 0 1 182
total ( 1 ) 1 132 619 0 0 4 0 1 755 34 295 18 753 0 0 1 987 0 55 036
permanent
seasonal
tableau n°11 : workfoce, wages and external staff
1) local staff
Sonatel SA financial statements(in millions Xof)
annual report of activities Sonatel 2014
115
local staffother countries
of ECOWASoutside
ECOWAStotal
invoiced to the company
(in million XoF)
M F M F M F M F
1. senior executives 0 0 0 0 0 0 0 0 0
2. senior technicians 0 0 0 0 0 0 0 0 0
and middle managers 0 0 0 0 0 0 0 0 0
3. technicians, supervisors 0 0 0 0 0 0 0 0 0
and skilled workers 632 0 0 0 0 0 632 1 466 0
4. employees, laborers, 0 0 0 0 0 0 0 0 0
workers and apprentices 0 0 0 0 0 0 0 0 0
total ( 2 ) 632 0 0 0 0 0 632 1 466 0
permanent
seasonal
total ( 1 + 2 ) 1 764 619 0 0 4 0 2 387 37 748 18 753
M = MaleF = Female
2) external staff
Sonatel SA financial statements(in millions Xof)
116
>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.
auditors’ general and special report
1. opinion 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
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.
Sonatel 2014 annual report of activities
117
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.
16th February 2015
The Auditors
GARECGOJPA INTERNATIONAL NETWORK MEMBER
RACINEERNST & YOUNG MEMBER
annual report of activities Sonatel 2014
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
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..
>
118
Sonatel 2014 annual report of activities
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.
Auditors’ general report
2. specific verifications and information
We have also performed the specific verifications re-quired by the OHADA Uniform Act relating to Commer-cial Companies and Economic Interest Grouping.
We have no issue to report regarding the fair presenta-tion 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.
16th February 2015
The Auditors
GARECGOJPA INTERNATIONAL NETWORK MEMBER
RACINEERNST & YOUNG MEMBER
119
annual report of activities Sonatel 2014
accounting methods and policies basis of preparation of financial statements The financial statements are prepared on the basis of generally accepted accounting principles admissible and retained in the OHADA accounting system: pru-dence, consistency of methods, specialized exercises, historical costs, business continuity, transparency and material significance. The annual financial statements are presented in ac-cordance with the requirements of OHADA accounting system and the main accounting policies and methodo-logies used are as follows:
immobilized charges and intangible assets
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.
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 ac-cording to the principles of currency transactions.
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
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.
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 20 yearsLand enhancement work 40 yearsEquipment, office and home furniture 5 yearsFixtures, fittings and installations 8 yearsTransportation equipment 3 et 5 years
Operating equipment:• Switching 10 years• Transmission 10 years• Lines and Networks 10 years• Energy 7 years• Measuring Equipment 3 years• Other assets 5 et 10 years
120
Sonatel 2014 annual report of activities
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 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.
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.
121
annual report of activities Sonatel 2014
provisions for liabilities and charges
disputes
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.
investment grants
The amortized share for the fiscal year is recognized in the income statement.
122
Sonatel 2014 annual report of activities
>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.
auditors’ special report on regulated agreements for the fiscal year
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 short-term 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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2. assistance 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. assistance 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
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 high-
tech equipment,
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• 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 ...)
This agreement was the subject of an addendum mentioned in paragraph 3 of this report
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.
Legal, regulatory and bill collection technical assistance will be billed by Sonatel for a lump sum of 250 million XOF.
The distributions of refill cards and SIM cards will be billed respectively up to 4 percent and 10 percent of turnover with retailers.
The network management and computer technology will be billed in proportion to the resources allocated by Sonatel.
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
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). The parties agree that Sonatel Mobiles will pay the activities of outsourced technical hotline. It will invoice to Sonatel its share.
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. 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;
• 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;
• remuneration of current accounts will be paid by Sonatel Mobiles depending on the amount of surplus and overdraft of Sonatel Mobiles.
The management of accounting and taxation activities will be billed for an annual lump sum of 623 million XOF.
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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annual report of activities Sonatel 2014
Over the year, this agreement generated a total of 40,927 million XOF, which break down as follows:
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 Sep-tember 2012) between Sonatel and Sonatel Multimedia. This agreement replaces the agreement signed on 17 December 2007 and its amendments 1, 2 and 3 dated
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 exper-tise, 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.)
in millions of XOF
management fees 14,352
experts on secondment 0temporary experts 0payments done at windows 574marketing 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 40,927
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Sonatel 2014 annual report of activities
terms and effects
In consideration for the transfer of know-how, Sonatel Multi-media 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, purcha-sing, 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 tech-
nical activity and information technology
• in respect of marketing and communication activities, an annual lump sum equal to 1 percent of annual sales out-side 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 subscri-bers base on the total subscribers base,
Depreciation of Sonatel vehicles used by Sonatel Multime-dia 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 179
litigation 5
collection of receivables 241
total 1,431
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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 collabo-ration 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
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, in-formation systems, purchasing, ...);
• permanent technical assistance with the provision of permanent experts participating in the leadership and management of the company and its subsidiaries;
• ad hoc technical assistance with the completion of ti-mely and specific studies, problem solving related to the organization or operation.
terms and effects
In consideration for the transfer of know-how and ser-vices 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 Mul-timedia, Sonatel Business Solutions) net of intra-group activities.
This fee has a ceiling of 1.43 percent of the Group So-natel 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 sup-ported by Sonatel and are outside of the lump sum set by France Telecom. The amount of charges billed by Sona-tel 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
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nature and purpose
A memorandum of understanding was signed on 1 No-vember 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. France Telecom and Sonatel agreed that the fee payable each year to France Telecom by Sonatel and its Sene-galese 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 turno-ver of the Sonatel Group.
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 Sene-galese 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 conso-lidated 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
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.
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 disburse-ment of funds to the account of Orange Bissau. On 31 December 2014, the outstanding loan amounts to 1,000 million XOF.
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 pro-vides 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 disburse-ment 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.
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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 disburse-ment 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 disburse-ment 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 amortiza-tion 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 provi-des to Orange Bissau a five (5) years medium-term loan of 4,700 million XOF, which begins from the date of dis-bursement 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 disburse-ment 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 accor-dance with the amortization schedule.
As of 31 December 2014, the outstanding loan is null.
Interest recorded for the year 2014 amounted to 13 mil-lion XOF.
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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.
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 So-natel and Sonatel Business Solutions signed on 7 June 2005, and which includes:
• transfer of know-how between Sonatel and Sonatel Bu-siness Solutions;
• the management of permanent assistance with the availability of experts to participate in the management of the company;
• occasional assistance for solving problems related to the organization (legal advice and studies, assistance in litigation, collection of receivables, finance and ac-counting, 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 agree-ment 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
In return for the services received, Sonatel Business So-lutions agrees to pay to Sonatel an annual flat fee equal to 2 percent of its turnover excluding tax from the se-cond 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 Solu-tions is billed according to following conditions: [(acqui-sition 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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annual report of activities Sonatel 2014
The amounts accounted by Sonatel on 2014 fiscal year under this agreement amounted to 581 million XOF and are detailed as follows:
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 Bis-sau 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
gross cost of staff available on a permanent basis, wi-thout 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.
in million XOF
accounting assistance 38
management fees 75seconded staff 440vehicles rental 13legal assistance 5information technology management 10
total 581
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Sonatel 2014 annual report of activities
The amount accounted for the 2014 fiscal year under this agreement amounted to 645 million XOF and is as follows:
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-li-cense the use of the Orange brand in their territory,
• the support services for pre-launch and re-brand na-ming of the Orange Brand Services Limited,
• the support services in terms of marketing and commu-nication 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 activi-ties 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 Au-gust 2002 between Sonatel and Orange Mali in the fol-lowing 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, en-gineering 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.
in million XOF
management fees 442
seconded staff 175occasional assistance -network management 28information technology -
total 645
17. license Agreement for the use of the Orange brand
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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 «manage-ment 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 (deprecia-tion 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 fol-lows:
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 manage-ment control, technical, marketing,
• 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».
in million XOF
annual fee 5.464
seconded staff 283
information technology 196
ad hoc assistance 4
total 5 947
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Sonatel 2014 annual report of activities
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 So-natel 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 fol-lows:
20. memorandum of Understan-ding with Canal
concerned director• Sonatel company represented by Ms. Marie Sow Diop.
nature and purpose
There is a Memorandum of Understanding between So-natel, 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 Hori-
zons 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 Hori-zons TV bouquet via ADSL,
• a contract for the subscribers’ management by Sona-tel.
terms and effectsFinancial terms of the protocol are:
Under the transportation and signal managementCanal 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 Canal-Sat Horizons bouquet TV ADSL subscribers.
Canal will pay to Sonatel a monthly fee per subscriber established on the basis of a monthly average subscri-ber based on the following thresholds:• 4 euros per subscriber per month, if the average mon-
thly 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 mon-thly number of subscribers exceeds 5000.
in million XOF
seconded staff 638
management fees 2,478occasional assistance 14computer technology 83
total 3,213
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The Auditors
16 February 2015
Under distribution of servicesIn 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 Canal-Sat Horizons TV bouquet via ADSL subscribed via Sona-tel 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:• an amount of 34 million XOF for the services of trans-
portation and signal management,• an amount of 224 million XOF for the services of
subscriber management,• an amount of 12 million XOF under the distribution ser-
vices.
21. franchise Agreementconcerned Directors• Mr. Mamadou Sarr • Mr. Birane Diouf• Mr. El Haji Abdou Aziz Mbaye
nature and purpose
A franchise agreement between the Government of Se-negal 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-
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 directorsIn accordance to the Article 432 of the Uniform Act of OHADA on the law of commercial corporations and eco-nomic interest group, the Sonatel Board of Directors, at its meetings of 9 April 2008 and 13 October 2009 au-thorized 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 Com-mittees meetings.
In the 2014 fiscal year, there was no reimbursement of expenses.
23. reimbursment of administra-tive fees
Following the article 432 of the OHADA Uniform Act re-lating 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 reim-bursement for hotel expenses and transport costs of the directors between their normal place of work and the Di-rectors Board meetings or Committees Board meetings places.
Under the 2014 fiscal year, there is no reimbursement of fees.
GARECGOJPA INTERNATIONAL NETWORK MEMBER
RACINEERNST & YOUNG MEMBER
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>a. resolutions of the competence of the
annual general assembly :
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.
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.
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.
draft resolution 2 : allocation of 2014 year income.
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.
The General Shareholders’ Assembly decides to allocate the result as follows:
First dividend 3.000.000.000 FcfaAdditional dividend 157.000.000.000 FcfaOther 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.
agenda of the general meeting of shareholders of Sonatel thursday, april 9th, 2015.
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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
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.
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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 :The registered office is at 64, Voie de Dégagement Nord (VDN) in Dakar (Senegal)…» (The rest remains unchanged)
2. Article 6 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
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 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. »
5. Article 16 of the Statutes is amended as follows :« 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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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.).
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.
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