Evenements, mon cher

5 March 2003

New boss Thierry Breton has detailed his plans for generating E15bn of free cashflow between now and 2005. Will this be enough for investors to buy into a rights issue? Or will they want to see operating expenses fall first?

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France Telecom's new chief executive Thierry Breton detailed the TOP program that aims to generate E15bn of incremental free cash flow in the 20032005 period.

Among the most significant projects are:

• The centralising of purchasing at the group level and a reduction in the supplier base from 742 at the end of 2002 to 650 at the end of 2003

•A review of capital expenditure aimed at reducing it to below E7bn or 13% of sales. This will mean a more selective launch of 3G services by the wireless subsidiary Orange

•A coordination of marketing and communications expenses, expected to E600m of savings over the 20032005 period

•Squeezing at least E500m more out of working capital in 2003.

The group also published its fullyear results. Ebitda was bang in line with analysts' forecasts at E14.9bn. Breton said FT would have sufficient liquidity to cover its refinancing needs until the end of 2004.

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