The headline news from the latest SES results is that its ‘Networks’ business now represents more than 40 per cent of its business overall, and that the division has enjoyed a 29 per cent growth year-on-year. SES is contemplating spinning off the division into a separate business.
Steve Collar, CEO, says that the satellite operator has made a strong start to the year. “We have a strong, resilient business with predominantly fixed, long-term contracts and 85 per cent of our expected revenue for 2020 already secured. To date our results have been largely unaffected by Covid-19. Nevertheless, the impact of the pandemic on the global economy and on several of the business verticals that we serve is profound and it is inevitable that we will be impacted as we support our most affected customers.”
“Looking beyond Covid-19, Simplify & Amplify, our strategic transformation programme, is well underway. We are executing on initiatives that will generate €40-50 million annualised EBITDA optimisation in 2021 and beyond and we are making progress on the potential separation of our Video and Networks business within SES,” added Collar.
Collar also addressed the upcoming C-band strategy over the US, saying: “We have set up a dedicated team to execute on the objectives of the US FCC’s C-Band final Report and Order, including the ability for SES to earn up to $3.97 billion in acceleration payments for efficiently and effectively repurposing C-Band spectrum while protecting our broadcast neighbourhoods.”
Group revenue was €478.9 million for Q1 2020 (-1.9 per cent at constant FX compared with the prior period). Underlying revenue (excluding periodic and other) reduced by 2.2 per cent (y-o-y) at constant FX to €470.8 million.
Backlog stands at €6.2 billion. At March 31st 2020, SES carried a total of 8,330 TV channels to viewers around the world including 2,923 channels in High Definition (up 3.4 per cent year-on-year) and 53 commercial UHD channels (Q1 2019: 52). More than 68 per cent of the total TV channels carried on the SES fleet are now broadcast in MPEG-4 with an additional 4 per cent in HEVC.