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France Telecom gets Orange boost

Strong growth in subscriptions to mobile phone network Orange has helped boost profits at owner France Telecom.

Orange added more than five million new customers in 2004, leading to a 10% increase in its revenues. Increased take-up of broadband telecoms services also boosted France Telecom's profits, which showed a 5.5% rise to 18.3bn euros ($23.4bn; £12.5bn). France Telecom is to spend 578m euros on buying out minority shareholders in data services provider Equant.

France Telecom, one of the world's largest telecoms and internet service providers, saw its full-year sales rise 2.2% to 47.2bn euros in 2004.

Orange enjoyed strong growth outside France and the United Kingdom - its core markets - swelling its subscriber base to 5.4 million. France Telecom's broadband customers also increased, rising to 5.1 million across Europe by the end of the year. The firm said it had met its main strategic objectives of growing its individual businesses and further reducing its large debt. An ill-fated expansion drive in the late 1990s saw France Telecom's debt soar to 72bn euros by 2002. However, this has now been reduced to 43.9bn euros. "Our results for 2004 allow us to improve our financial structure while focusing on the innovation that drives our strategy," said chief executive Thierry Breton.

Looking ahead, the company forecast like-for-like sales growth of between 3% and 5% over the next three years. France Telecom is consolidating its interest in Equant, which provides telecoms and data services to businesses. Subject to approval by shareholders of the two firms, it will buy the shares in Equant it does not already own. France Telecom said it would fund the deal by selling an 8% stake in telephone directory company PagesJaunes.