SES still under pressure; C-band a “win-win”

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Half-yearly results from satellite operator SES showed video revenues – worth 67 per cent of group revenues – remain under pressure, with the company booking €650 million in H1 2018, but this was 2.3 per cent lower than H1 2017.

At H1 2018, SES distributed 7,941 total TV channels globally, up 3 per cent compared with H1 2017 reflecting positive development across all major regions. 65 per cent of total TV channels are now broadcast in MPEG-4 (H1 2017: 63.5 per cent).

Acceleration of HDTV in Europe, North America and International markets led to a year-on-year increase of 7 per cent in the global number of HDTV channels, now totalling 2,765, while the total number of commercial UHD channels also increased from 20 to 38 compared with H1 2017, mainly driven by new UHD TV channels launched in Europe.

SES’s contracted backlog also fell. At 30 June 2018 backlog stood at €7.1 billion (30 June 2017: €7.4 billion at constant FX). Over 90% of the 2018 expected group revenue is already contractually committed, said the company.

On the question of the prospects for a favourable FCC decision on the re-use of C-band spectrum for 5G service over the USA, CEO Steve Collar said: “I am pleased with the FCC’s emphasis on the protection of incumbent users from harmful interference and the positioning of our market-based solution as a lead proposal in its recent meeting. Our solution will be able to deliver a landmark win-win, freeing up important spectrum quickly to support mid-band 5G roll-out across the US while protecting and enhancing our video distribution neighbourhoods for the tens of millions of households that they serve.”

As to forward guidance, SES says its 2018 revenue outlook is unchanged. “Group revenue is expected to grow between 2018 and 2020, fuelled by the strong growth outlook for SES Networks which is re-affirmed. The outlook for SES Video revenue in 2020 is updated to reflect a more prudent expectation for the business.”

Those expectations for 2020 are:

Video: €1.25 billion-€1.3 billion (down from €1.35bn)

Networks: €850 million-€900 million (from over €850m)

 


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