SES told analysts that while it was looking forward to banking some $3 billion in cash from the FCC’s C-band compensation scheme (and likely to be banked early to mid-Q4/2023) there was more cash likely to be forthcoming. CFO Sandeep Jalan’s advice was to “stay tuned”.

Acting CEO Ruy Pinto and Jalan were briefing analysts after the company’s results announcement which reported a near-10 per cent rise in overall revenues for the half-year.

The prospects of more revenue, over and about the $3 billion, plus around $500 million in cost reimbursements from the refitting of filters and new reception equipment for its North American clients and their head-ends, the prospects of another slice of the C-band cake helped drive SES’ share price up more than 15 per cent on August 3rd to €6.68 and a welcome improvement on its lacklustre performance of late.

However, there was also bad news in the form of a sporadic malfunction of a fraction of the electronic components on board orbiting mPOWER satellites.

“Management suggested they are able to quickly recover function and suggested it was not worried on any short or long term impact. On mPOWER 5 and 6 craft management suggested the satellites were undergoing further tests in Boeing’s facility and would be launched in Q3 for a late 2023 entry into service date for mPower,” said equity analyst Sami Kassab from investment bank Exane/BNPP.

“Given the recurring postponement of mPOWER satellite launches and in the context of today’s disclosure of sporadic electronic malfunction, it is hard not see a causality link between these tech issues and the delayed entry into service of the constellation,” added Kassab.

mPOWER is the new fleet for SES’s O3b segment, and by any measure there has been slippage on the launch – and thus revenue-generating – satellites. However, on the more positive upside SES management argued that despite increased competition from Elon Musk’s Starlink in Mobility, its maritime revenues grew 30 percent and continued to perform well.

Kassab, commenting on the overall position at SES, stated: “SES H1 results were strong and marked by a return to positive group organic growth in Q223. It confirmed its FY guidance and while the C-band money is not yet in the bank, management announced a surprise share buyback programme (of €150m) and clearly suggested that more cash returns was on the agenda. Today’s share price spike is deserved but as long as mPower is not proving a commercial success, shares are likely to remain volatile. We reaffirm our Outperform rating.”

Other posts by Chris Forrester:

1. Ariane 6 launch campaign underway
2. Virgin Galactic in stock split
3. Thuraya-3 suffers major problem
4. AST SpaceMobile hit by Class Action
5. Optimism under threat at SES
6. Rivada visits Terran Orbital’s manufacturing HQ
7. Avanti wins spectrum debt obligation case
8. SpaceX breaks records for re-use launchers
9. IRIS2 already in trouble?

Categories: Blogs, Business, Inside Satellite, Satellite

Tags: cband, Sami Kassab, SES