SES: Reasons to be cheerful

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The SES end of year ‘report card’ is in, and in general the results went down well with the market. As investment bank Jefferies’ Giles Thorne was typical and said in a note to clients that SES had a strong finish to the year.

“SES outperformed 4Q/2018 expectations (+4.4 per cent ahead on revenue, +1.1 per cent ahead on EBITDA) and its own FY18 guidance. Within the mix, the Networks performance was impressive (+12.2 per cent ahead of consensus), the Video performance more muted (-0.4 per cent behind). Group revenue growth accelerated to +5.2 per cent from +2.4 per cent/+4 per cent in 3Q18/2Q18,” said Thorne

“The strong finish to 2018, and the Networks contribution therein has undoubtedly given management a spring in their step,” added Thorne, but worryingly stated “Video refuses to toe the line”.

The analysts were, by any measure, extremely interested in what CEO Steve Collar had to say on the prospects for C-band reallocation over the US. SES (with Intelsat) controls over 90 per cent of the C-band spectrum. Seemingly the FCC will adjudicate on whether the C-band Alliance can sell off 180 MHz of bandwidth in the next few months.

FCC Commissioner Michael O’Rielly told an NAB-organised audience of broadcasters on February 26th that they should not get “greedy or seek unfair enrichment for the reallocation” of C-band spectrum and, even if that were the case, the FCC (and the Alliance) would provide full reimbursement and re-tuning for any broadcaster affected. But he also made clear that it was a “near certainty” that a “good portion” of the C-band spectrum was going to be reallocated.

Currently AT&T and Verizon are generally supportive of the C-band Alliance’s plan, while Charter, T-Mobile and Google are fighting the move.


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