SES Q3: Still under pressure

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SES has released its 9-months trading update. Revenues (as reported) were down 6.5 per cent at €1.319 billion (€1.410 billion same period last year).

SES says that its underlying revenue (excluding periodic and other) was lower by 2.7 per cent year-on-year (at constant FX) at €1,318 million. SES says that in July it spent €94 million buying in its own shares for cancellation.

At September 30th 2021, SES delivers 8,555 total TV channels to 361 million TV homes around the world. This includes some 3,150 TV channels in HD which has grown by 8 per cent compared with September 30th 2020. At September 30th 2021, 71 per cent of total TV channels carried over the SES network are broadcast in MPEG-4 with an additional 5 per cent broadcast in HEVC.

The operator’s Video division’s underlying revenue of €785 million represents a reduction of 4.1 per cent year-on-year (at constant FX), compared with -8 per cent year-on-year in FY 2020, where lower revenue from mature markets was partially offset by the growth of HD+ in Germany, higher revenues generated across International markets, and a recovery in Sports & Events. Q3 2021 underlying revenue of €259 million was 4.6 per cent lower y-o-y (at constant FX) and 1.3 per cent lower compared with Q2 2021.

SES says that its growing Networks division’s underlying revenue of €533 million was flat compared with YTD 2020 (-0.6 per cent at constant FX) with strong ongoing growth in Government (+7.7 per cent) offsetting short-term Covid-related impacts on Mobility (-8.8 per cent) and near-term declines in Fixed Data (-2.9 per cent). Q3 2021 underlying revenue of €184 million (-1.3 per cent y-o-y at constant FX) was 4.8 per cent higher than Q2 2021 reflecting a recovery in Cruise, combined with new revenue from Aeronautical, Cloud, and Energy customers.

Adjusted Net Profit improved by 17.2 per cent y-o-y to €225 million including the positive combination of the lower recurring operating expenses highlighted above, lower depreciation and amortisation expenses (down 7.3 per cent y-o-y), and a 21 per cent reduction in the net interest expense. Adjusted Net Profit also included a net foreign exchange gain of €24 million (YTD 2020: loss of €19 million).

SES’s all-important Contract backlog at September 30th was €5.2 billion (€5.8 billion gross backlog including backlog with contractual break clauses).


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