Bank: European satellite-based video eroding

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Satellite operator’s video-based revenues are under pressure as broadcasters continue to go digital. The trend has generated comment from investment bank Exane/BNPP on January 13th, and which said it expected that video revenues would continue to deteriorate during 2021 for SES and Eutelsat.

“In 2019 & 2020, Eutelsat had been able to report better quarterly revenue trends than SES with Eutelsat Broadcast revenues down 1 per cent on average over the last 3 quarters and SES Video Distribution down c7-8 per cent. In 2021, we expect the gap to narrow, with both a deterioration at Eutelsat and some moderate improvement at SES,” says the bank.

”Within the Networks side of the industry, we expect Eutelsat to see growth accelerate in its Fixed Broadband division but pressure to continue in Mobility, Fixed Data and Government. For SES Networks, we expect positive organic revenue growth but at a lower pace (6 per cent), driven by weaker new business in Mobility. We believe the shares are likely to be sensitive to news headlines from new entrants (Starlink and OneWeb in particular),” Exane/BNPP adds.

The bank also drops a pebble into the consolidation pond (again) saying: “Consolidation theme, post C-Band more likely but remains an acutely political decision. Both stocks at best seem like avoids.”


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