Integrated Report 2017 Orange Polska 2 Orange Polska Integrated Report 2017 CONTENT Orange Polska Integrated Report 2017 3

Integrated Report 2017 Orange Polska 2 Orange Polska Integrated Report 2017 CONTENT Orange Polska Integrated Report 2017 3 Content 04 Introduction 08 Company and our stakeholders 14 Business model and value creation 38 Strategy 50 Results 76 Risk management 84 Corporate governance 130 Selected financial data 140 Appendix Introduction 6 Orange Polska Integrated Report 2017 INTRODUCTION Message from CEO Dear All, Welcome to our annual report, the second in which Orange Polska’s results are presented on an integrated basis. This represents a new way of communicating with our shareholders and other stakeholders, one that combines the financial and non-financial aspects of our business. Our in- tention is to show you the wider context of our activities, and in particular how our business responds to the external and internal environment in which we operate. In this report we discuss how we create value over time for our stakeholders, how we build sustainability, and we demonstrate that we can create value not only in financial terms, but also in other forms like trust, reputation, job satisfaction, customer loyalty or good relations with local communities. Orange Polska has for the past few years been run in a more integrated way for the benefit of customers and other stakeholders, so integrated reporting felt like a better way to tell our story. Integrated thinking is more and more a part of ‘business as usual’, and is reflected in: • our strategy, in which we take into account the needs and expectations of our stakeholders, • our thinking and the way we manage the company, • understanding and measuring our impact on economy and societies, • our communication with stakeholders. For us integrated reporting is also the way we show financial data in a broader social context, as well as non-financial data as an important factor in our company development. This gives us a new standard for management and increa- ses our transparency. I hope that our story will meet with your attention and inte- rest. Jean-François Fallacher President and CEO of Orange Polska INTRODUCTION Orange Polska Integrated Report 2017 7 About the report Our new approach to reporting Orange Polska is pleased to present its second integrated annual report. The previous integrated report was published in 2017. In it, we continue our commitment to communicating with our shareholders and other stakeholders in a way that combines the financial and non-financial aspects of our business. It presents our business model, our value creation story, the economic and social context of our operations, how we implement our strategy, how we are governed and how we influence the environment. We hope that by reporting in this way we can demonstrate to our investors as well as other stakeholders the wider context of our business activities, and explain our responsible approach to doing business. We create value not only in financial terms, but in other forms such as trust, reputation, job satisfaction, customer loyalty and good relations with local communities. We encourage you to read the report and share your opinions by sending us your feedback to [email protected]. Scope and boundaries The content of this report addresses key developments and material matters for the period 1 January to 31 December 2017. It provides insight into our business model, our strategic priorities, and the external and internal environment in which we operate: all factors which determine our strategy. It provides both qualitative commentary and quantitative performance measures. The report content is driven by ma- teriality, and it sets out to address the most important to- pics for different groups of our stakeholders. The report also includes information on the indirect impact of Orange Pol- ska in the value chain-building relationships with suppliers, public administration, business and social partners. We re- fer to our impact on the economy, local communities and the environment. For the purposes of this report we have included our full consolidated financial statements and our most material social and environmental information. The content and the layout of this report are based on the International Integrated Reporting Council (IIRC) and Global Reporting Initiative (Standard) guidelines, ISO 26000 and the Global Compact Principles. The report also reflects the directions in EU legislation on disclosures of non-financial and diversity information. Company and our stakeholders 10 Orange Polska Integrated Report 2017 COMPANY AND OUR STAKEHOLDERS Orange Polska vision Loved by customers. Preferred by employees. Valued by shareholders. We aim to provide best in class connectivity and convergent digital services to the people of Poland thanks to our uni- que combination of high-speed broadband fixed and mobile networks, our wide geographic presence, our skilled and customer-focused employees and the values of our Orange brand. We want to be the efficient, socially responsible and “human inside” Polish operator of choice, allowing everyone to connect to what is essential in their life. Orange Polska mission Provide Polish consumers and businesses with the best high-speed connectivity and an unmatched customer expe- rience. We will achieve this by designing simple, digitally-enabled services on mobile and fibre, allowing our customers to be always in touch and connect to what is essential in their lives. Orange brand values About our company Friendly We treat everyone as an individual and dedicate time for listening. We look forward to working together and sharing Orange Polska is Poland’s leading telecommu- successes. nication provider, operating in all segments of the Polish telecoms market. The Group owns Honest the largest telecom infrastructure in Poland, We talk about what we intend to do and we do what we have providing voice and data services on fixed and promised. We have nothing to hide, we take responsibility mobile networks. Orange Polska is 50.67% for our actions. We are always transparent and honest. owned by Orange S.A., one of Europe’s leading Direct telecom operators. Orange Polska’s success is founded on a portfolio of competitive products, We always try to speak in a manner understandable to eve- a powerful, proactive sales force and outstand- ryone. We are clear in our statements. ing customer care, supported by a robust in- Inspiring frastructure and highly motivated employees. Co-ordinating our efforts around a lean, agile We always try to view the world from a different perspective, operating model will ensure that we deliver to choose the best course of action. We see things in full healthy and sustainable returns to our share- colour. We are ready to go beyond the boundaries and take holders. risks. Dynamic We are passionate about what we do and what we believe. We want to actively change people’s lives. Our optimism is contagious. COMPANY AND OUR STAKEHOLDERS Orange Polska Integrated Report 2017 11 Orange Polska in 2017 in numbers Shareholder structure 50.67% 49.33% 11.4 bn PLN revenues Orange S.A. Other shareholders 3.0 bn PLN 26.5% 14,587* adjusted EBITDA adjusted EBITDA margin employees at year end 1.9 bn PLN 3,258 volunteers among employees capital expenditures 403,488 100 7.6 bn PLN children learned digital Orange market cap at year end to use the internet Studios for local safely communities Convergent Mobile Fixed TV customers Fixed customers accesses broadband voice lines (SIM cards) accesses (retail) (retail) 1,306,000 14,424,000 2,438,000 848,000 3,684,000 (+56.4% yoy) (-8.7% yoy) (+10.5% yoy) (+10.7% yoy) (-6.3% yoy) post-paid 9,726,000 Fibre 214,000 (+5.0% yoy) (+143.2% yoy) pre-paid 4,698,000 VDSL 467,000 (-28.1% yoy) (+15.6% yoy) *full time equivalents 12 Orange Polska Integrated Report 2017 COMPANY AND OUR STAKEHOLDERS Our stakeholders Why it is important to engage As a listed company we take care of our investors and the financial community. Investors Our customers are vital for the success of our business and we put them at the heart of everything we do. Customers Engagement of adequately skilled and motivated employees plays a critical role in delivering excellent Employees customer service and increasing long-term value generation. Building strategic alliances can help to ensure the quality of our network and broaden Business our portfolio of customer offers. Partners Suppliers and contractors impact on our ability to provide products and deliver services. Suppliers As our industry is regulated, it is essential for us to establish and maintain constructive relationship Government with the regulator. and regulators Empowering local economies strengthens the socioeconomic context in which we operate. Communities COMPANY AND OUR STAKEHOLDERS Orange Polska Integrated Report 2017 13 Through dialogue with our stakeholders, we learn to respond to their expectations more effectively. This chart identifies our key stakeholders, their concerns and how we engage with them. In the course of our business activities, we come into contact with members of each of these groups, every day. How often Ways we engage we engage What matters most to them Providing detailed and transparent Quarterly and an- Transparent financial information; turnaround in communication of financial and nual results publica- revenue, EBITDA and cash flow. Monetisation operational results; engaging in tion and meetings; from network investment. Dividend prospects. direct dialogue with investors through surveys; continuous participation in roadshows, conferences direct contact

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