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Eutelsat’s Q3 overall revenues were €364.3 million, down 4.2 per cent (at constant currency) and 4.9 per cent as reported. Eutelsat said that its channel count was up 3.2 per cent (same period last year) at 6,356, and with HD penetration also rising at 1,057 channels and now represented 16.6 per cent of the operator’s channel count, and up an impressive 31 per cent on the same period last year (807 channels).
Eutelsat’s all-important forward contracted backlog stood at €5.2 billion (down about €100 million on December 2016, and well down on the €5.9 billion a year ago). Eutelsat’s fill rate is down marginally, from 7.9 per cent at December 31st 2016 to 68.2 per cent at the end of March.
One surprise was that CEO Rodolphe Belmer did not present the results to the market analysts, but the call was competently handled by CFO Sandrine Teran and deputy CEO Michel Azibert.
But the revenue that flowed from the increase in broadcast video channels was down 4.1 per cent (y-o-y) at €228.1 million, and for Professional Video was 9.1 per cent down (y-o-y) “reflecting continued pressure on contribution services during this period”. Eutelsat stressed that its Broadcast revenues were “broadly stable” despite the loss of a major contract with Orange TV back in January.
“On the commercial front, a multi-year, multi-transponder contract was signed with NTV-PLUS covering the Express-AT2 satellite at 140° East to reach homes in Far East Russia and incremental capacity on the Express-AT1 satellite at 56° East to consolidate coverage of Siberia. Elsewhere, a multi-year contract with Ethiopia’s INSA agency was also finalised for a new TV platform at 7/8° West neighbourhood, while SRG SSR, Switzerland’s public broadcaster renewed a HOTBIRD transponder on a multi-year basis,” stated Eutelsat.
Eutelsat’s ‘Fixed Data’ segment also fell back, by 12.6 per cent (y-o-y) at €42.1 million. “[These] continued to reflect ongoing pricing pressure in all geographies, albeit at a slightly slowing pace,” said the company. Quarter on quarter revenues were down 1.4 per cent.
Its Government Services division (12 per cent of revenues overall) saw falls of 3 per cent (y-o-y) and were “broadly unchanged” q-o-q.
Analysts at Exane/BNP-Paribas, in an early note to investors, said that Eutelsat’s short- and mid-term guidance had been confirmed, with management expecting to reach the middle of the -3 per cent to -1 per cent organic revenue guidance for the year, in line with consensus expectations, and broadly flat revenues for the upcoming year and a return to modest growth in 2019.
Investment bank Jefferies described Eutelsat’s results as “solid” and praised the operator’s Video-based revenue strategy, saying it was “articulated with notable confidence”.