SES “weak quarter expected”

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On July 26th SES will unveil its latest quarter of numbers (Q2) and a forecast from analysts at investment bank Exane/BNPP is not exactly rosy.

The analysts say they expect the quarter’s revenues to be “weak” adding: “In Video, we expect underlying revenue growth to reach -10 per cent in Q2/19 (vs. -7.8 per cent in Q1/19) with underlying operational trends largely unchanged (ie c-8 per cent down) and an IFRS15-related impact which we estimate at about 2 percentage points.”

“In Networks, we expect Q2/19 underlying revenue growth of 4 per cent (5 per cent in Q1) on the back of the absence of incremental capacity entering into service in Q2/19. With the SES 12 contract with TeleGlobal and the four new O3B satellites entering into service in Q3/19, we expect SES Networks growth to accelerate in H2/19. We believe management will maintain its double-digit CAGR 17-20 percent revenue growth guidance and have not changed forecasts.”

“Given the pre-announced restructuring charges, we expect Q2/19 EBITDA of €292 million of 60.9 per cent on our €479 million of Q2/19 revenues. No consensus available at this stage.”

The bank also updates its opinion on the C-Band Alliance’s prospects, saying: “With no talks planned on C-band at the July meeting of the FCC, we believe that the C-band story is unlikely to offset the weak Q2/19 trends in Video. While we remain Outperform on C-band, we believe the shares could be weak in the short term.”


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