Eutelsat forced to delay Konnect VHTS

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Eutelsat enjoyed a near-spectacular market trading day on February 12th when its share price rocketed more than 6 per cent to end the day at €10.31. The rise reflected a sense of buoyancy from CE Rodolphe Belmer despite his alerting the market that its much-needed super-satellite Konnect Very High Throughput Satellite (VHTS) would be around one year late coming into use.

The Konnect VHTS is being built now but Covid has slowed down production. The broadband-focussed craft will have 230 Ka-band spot beams and had been expected to launch this year. Its launch has been delayed until 2022 and will enter service in “early 2023”.

Konnect CHTS is not the only craft to be delayed by Covid production challenges. Eutelsat’s Quantum craft is now expected to launch in Q2/2021, pushed back from this current quarter. Eutelsat’s Hotbird 13G is now expected to launch in H1/2022, pushed back from H2/2021.

But the market did not seem too alarmed by the bad news and instead listened to a presentation that more or less said that the period of austerity was over, that Eutelsat was “resilient” to Covid and that Eutelsat could look forward to more reliable revenues with effect from July 1st this year with the start of its new financial year. Belmer also told analysts that its Occasional Use market had largely recovered.

“In Broadcast, activity remained dynamic in Sub-Saharan Africa, with the expansion of our contract with MultiChoice, one of our on-core African customers, which committed to additional capacity on a multi-year basis. And with the extension of our multi-transponder contract with ZAP TV another on-core customer at 36° East and the leading pay-TV provider in Portuguese-speaking countries,” Belmer said.

Meanwhile, Eutelsat still has its ‘basic’ Konnect Bigblu/broadband service up and running and doing business. While the satellite carries only 65 spot beams it is earning its keep from the likes of Orange of France and TIM of Italy which have contracted for a combined €350 million-worth of capacity over the next 12 years. Add in a contract from Thales Alenia for its government mobility business and that revenue commitment grows to around €450 million over the next 12 years, and discussions with other “major European” distribution players are ongoing

Belmer said that even by 2030 there will still be some 4 million homes in Europe and 5 million in Africa which will still be beyond terrestrial connectivity.

Michel Azibert, deputy CEO, told analysts that Broadcast, at 62 per cent of group total recorded revenues of €379 million, down 1.8 per cent versus last year. Data and Professional Video 13 per cent of group total saw revenues of €81 million, down 4.5 per cent. Government Services 13 percent of group total saw revenues of €77 million, up 2.5 per cent. Fixed Broadband 7 per cent of revenues stood at €42 million, a progression of 2.3 per cent. And Mobility 5 per cent of revenues saw revenues of €34 million, down by 13.9 per cent.


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