French incumbent and its Spanish counterpart both predict underlying earnings growth in 2017.

Orange and Telefonica this week reported broadly similar fourth quarter financial performances in terms of revenue and earnings, and both predicted modest growth in 2017.

The French incumbent generated revenue of €10.52 billion in the three months to 31 December, up by 1% year-on-year on a comparable basis. Revenues in Europe grew 4.5% to €2.74 billion, driven by Spain and Central Europe, which offset declines in Poland, and Belgium and Luxembourg. Revenue in France inched down 0.8% to €4.83 billion. Orange’s Africa and Middle East business generated revenue of €1.36 billion, up from €1.32 billion in Q4 2015.

Adjusted EBITDA increased to €3.17 billion in the fourth quarter from €3.03 billion last year.

For the full year, Orange’s revenue was broadly flat at €40.92 billion, compared to €40.67 billion in 2015. Adjusted EBITDA edged up to €12.68 billion from €12.52 billion.

"Our investments are driving our commercial performance, led by very high speed fixed and mobile broadband and despite a level of competition that is intense and unprecedented, particularly in France," said Orange CEO Stephane Richard, in a statement.

In 2017, Orange expects adjusted EBITDA to grow compared to 2016, driven by strong commercial momentum supported by cost reduction and capital expenditure.

Group fourth quarter revenue at Telefonica inched down 1% year-on-year on a reported basis to €13.72 billion, as strong growth in Brazil was offset by declines at its other operating units, particularly its U.K., Germany and Hispanoamerica divisions. Revenue in Spain fell 0.1% to €3.22 billion.

Operating income before depreciation and amortisation (OIBDA) increased to €4.46 billion from €4.21 billion. The Spanish incumbent’s closely-watched net debt fell by €998 million during the quarter to €48.60 billion.

Telefonica’s full-year revenue fell to €52.04 billion from €54.92 billion in 2015, while OIBDA declined to €16.52 billion from €16.85 billion.

In 2017, Telefonica said it expects flat revenues compared to 2016, and one percentage point increase in OIBDA margin.