|By Business Wire||
|November 9, 2012 02:13 AM EST||
SES S.A. (Paris:SESG) (LuxX:SESG) reports financial results for the nine months and three months ended 30 September 2012.
YTD Revenue of EUR 1,359.6 million
- An increase of 6.1% over the prior year, +1.6% at constant exchange rates (“constant FX”)
YTD EBITDA of EUR 1,012.0 million
- An increase of 6.4% over the prior year, +1.8% at constant FX
- EBITDA margin of 74.4% (2011: 74.2%)
YTD Profit of the group EUR 456.4 million (2011: EUR 446.7 million)
- An increase of 2.2% over the prior year
- Closing net debt / EBITDA of 3.02 times (2011: 3.13 times)
Contract backlog at an all-time high of EUR 7.2 billion
- An increase from EUR 6.8 billion at end of June 2012
- EUR 1.3 billion of renewals and new contracts signed YTD
- 24 transponder long-term contract renewal by Canal+
- Six transponder contract renewal by the BBC
- SES-4 and SES-5 successfully launched and brought into service
- ASTRA 2F successfully launched and will enter commercial service later this month
Romain Bausch, President and CEO, commented:
“The financial results for the first nine months of 2012 are in line with our expectations. Despite the impact of the end of analogue TV broadcasting in Germany at the end of April, strong underlying growth has resulted in revenue growth of 1.6%, at constant FX. Excluding the German analogue impact, revenue growth was 7.5%. In the period, SES has successfully launched three spacecraft (SES-4, SES-5, ASTRA 2F), two of which have already entered service. New business and renewals have further increased our backlog of future contracted revenue to an all-time high of EUR 7.2 billion, underlining the confidence and trust that our customers place in us. Full year 2012 revenue and EBITDA growth is expected to be in line with guidance. SES also reiterates the 2012-2014 revenue and EBITDA CAGR guidance (at constant FX) of approximately 4.5%. Once again, SES has demonstrated the resilience of the satellite sector in the economic downturn.”
YTD Q3 2012 Financial Review
In the year to date, reported revenue increased by 6.1%, to EUR 1,359.6 million. On a constant FX basis, revenue rose 1.6% despite the significant impact of the switch-off of analogue transmissions in Germany at the end of April. The resulting absence of five months’ revenue from this source in the year to date was more than offset by the contributions of the Quetzsat-1 satellite, which delivered a full nine months of revenue, other capacity sales, services rendered with the SES-3 Ka-band payload, and growth of the European services business (principally HD+). Excluding the adverse impact of the analogue switch-off, underlying revenue growth was 7.5% at constant FX.
As reported, operating expenses increased by EUR 17.5 million, or 5.3%, to EUR 347.6 million, reflecting the stronger U.S. dollar. On a constant FX basis the increase year-on-year was held at EUR 3.2 million, or 0.9%. Whilst costs of sales rose in connection with the strong performance from services activities, this increase was largely offset both by lower underlying cost levels achieved through cost management activities in the infrastructure business, and the positive impact in 2012 of some one time expenses incurred in 2011.
Reported EBITDA grew by 6.4% to EUR 1,012.0 million, a 1.8% increase on a constant FX basis reflecting a leverage impact from the strong infrastructure business and related cost containment activities as well as absorbing the unfavourable impact from the analogue switch-off in Germany. The total EBITDA margin was 74.4% for the nine months, slightly ahead of the prior year level of 74.2%, with infrastructure delivering a strong margin of 83.8% (2011: 82.9%) and services delivering a margin of 14.2% (2011: 14.9%). Excluding the adverse impact of the analogue switch-off, EBITDA growth was 10.0% at constant FX.
Depreciation and amortisation charges rose 13.1% to EUR 386.3 million, an increase at constant FX of 7.4%, driven mainly by fleet additions and a first quarter impairment charge of EUR 3 million.
Operating profit rose 2.6% to EUR 625.7 million, a decrease at constant FX of 1.4% reflecting the increased depreciation charges on the enlarged fleet.
Year to date net financing costs were EUR 18.4 million higher than the prior year period, due to lower net foreign exchange gains and reduced capitalisation of interest. At net profit level a lower tax charge and the absence of the negative impact of discontinued operations in the prior year period, contributed to an increase of 2.2% to EUR 456.4 million.
Net Debt/EBITDA was 3.02 times compared to 3.13 times at 30 September 2011.
Q3 2012 Financial Review
Third quarter reported revenue increased by 8.7% to EUR 467.7 million, also benefiting from a stronger U.S. dollar. On a constant FX basis, revenue rose by 1.8% in comparison with the third quarter of prior year, reflecting the favourable development of both infrastructure and services activities, which more than compensated for the significant impact of the German analogue switch-off. The full contribution of QuetzSat-1 in the period was complemented by other infrastructure sales and services rendered with the SES-3 Ka-band payload. In addition, European services activities increased their contribution, principally driven by the strong growth of HD+ in Germany. Excluding the adverse impact of the analogue switch-off, underlying total revenue growth was 10.9%, at constant FX. Reported EBITDA increased by 8.4% to EUR 346.9 million, a 1.1% increase on a constant FX basis. The total EBITDA margin for the third quarter was 74.2% and remains robust.
Increased depreciation and tax expense in the quarter largely absorbed the favourable development of EBITDA, resulting in a moderate increase in the third quarter profit of the group to EUR 157.7 million.
The first nine months of 2012 have witnessed the successful launch of three satellites, two of which, SES-4 and SES-5, have now been brought into service.
SES’ 52nd satellite, ASTRA 2F, was successfully launched on an Ariane 5 rocket on 29 September and is presently undergoing in-orbit testing. The satellite carries Ku- and Ka-band payloads for the delivery of high-performance Direct-to-Home (DTH) and next generation broadband services. It is the first of a three-satellite investment programme (ASTRA 2E, 2F and 2G), that provides replacement and growth capacity for the UK and Ireland at the 28.2/28.5 degrees East neighbourhood. The new satellites in this neighbourhood will, as of October 2013, use additional frequency spectrum granted to SES by Media Broadcast. The new ASTRA 2F spacecraft provides Ku-band capacity for UK / Ireland DTH as well as for pan-European services and for Sub-Saharan Africa. Its Ka-band payload will allow SES Broadband Services to support download speeds of up to 20 Mbps. The spacecraft is expected to enter commercial service later this month. In a subsequent event occurring in October 2012, Eutelsat commenced arbitral proceedings against SES, seeking a declaration that SES cannot use such additional frequency bands granted by Media Broadcast without breaching an intersystem coordination agreement signed in 1999 between Eutelsat and SES. SES strongly disagrees with Eutelsat’s position and will vigorously defend its right to use these frequencies from October 4, 2013.
The Group transponder utilisation rate at the end of September was 72.6%, representing 1,045 of the 1,440 transponders commercially available. The reduction of the utilisation rate from 81.0% in the prior year period and from 77.0% in Q2, 2012, respectively, is largely related to the onset of new capacity mainly from QuetzSat-1, the YahLive payload on YahSat-1A, SES-4, SES-5 and NSS-7 and unfavourably impacted by the analogue switch-off in Germany and the end of cable contracts at 23.5°E.
European revenue, on a constant FX basis, was down 3.3% compared to the prior year period. Available satellite capacity increased by 44 transponders compared to the prior year period, with the new capacity on the Nordic beam of SES-5 complementing that added by two relocated satellites (ASTRA 1F and ASTRA 1N). Utilisation decreased by a net 12 transponders, as the end of analogue transmissions in Germany (32 transponders) and of cable contracts at 23.5°E (15 transponders) were largely compensated by new transponder contracts for DTH and other applications. A long term contract renewal extended the duration of Canal+’s entire capacity of 24 transponders at 19.2°E. SES also renewed a multiple transponder contract with the BBC. The capacity, a total of six transponders, has been contracted on a long term basis and will be used for services in both standard and high definition. The capacity will be hosted on the SES satellites positioned at the orbital position 28.2 degrees East. The overall utilisation rate in the region stood at 78.3% at the end of September, with transponder pricing remaining stable.
HD+, the platform for HD broadcast of German commercial TV channels, has continued to develop strongly. At the end of September 2012, there were 2,800,631 active HD+ households. Of these, 761,456 were paying customers of HD+. The balance are HD+ users in the initial 12-month free trial period. The company expects the number of paying households to exceed one million by the end of the year.
North American revenues, on a constant FX basis, increased by 4.7% compared to the prior year period. The increase against the prior year period principally relates to services rendered with the SES-3 Ka-band payload and Government contracts on third party capacity. Available satellite capacity reduced by 27 transponders due to satellite movements and payload adjustments. Utilised capacity reduced by 10 transponders compared to the prior year period as new business partially offset the reduction of capacity on the AMC-15 and AMC-16 spacecraft, resulting in a utilisation rate of 76.5%. As in Europe, pricing in the North America region remained stable.
International revenues increased by 9.4% over the comparable period in 2011 on a constant FX basis. At the end of September, an additional 173 transponders were available compared to last year. The increased figure resulted from new capacity on QuetzSat-1, SES-4 and SES-5, the relocation of NSS-7 to 340 degrees East, the activation of the YahLive payload on YahSat 1A and the relocation of AMC-3 to 67°W, as well as other fleet movements. Utilisation increased by 55 transponders compared to the prior year period, resulting in an overall utilisation rate of 67.6%. Average revenue per utilised transponder was stable.
SES operates a number of spacecraft which are susceptible to solar array circuit failures. During the quarter to 30 September, there were no events impacting the commercial capacity availability on those spacecraft.
Outlook and Guidance
The business outlook is for continued growth, in particular in the Western European TV markets and for a range of applications in the emerging markets that are the focus of SES’ capacity expansion. SES is well positioned to serve the demand in these regions.
SES’ year-to-date revenue and EBITDA growth of 1.6% and 1.8% respectively (at constant FX) meets company expectations. Full year 2012 revenue and EBITDA growth is expected to be in line with guidance. SES also reiterates the 2012-2014 revenue and EBITDA CAGR guidance (at constant FX) of approximately 4.5%.
SES’ results for the 2012 financial year will be announced on Friday, 22nd February 2013.
Condensed consolidated income statement
In euro millions
|Average US dollar exchange rate||1.2495||1.4388||1.2890||1.4167|
|Depreciation and amortisation expense||(132.7||)||(112.0||)||(386.3||)||(341.5||)|
|Net financing charges||(43.4||)||(44.2||)||(123.4||)||(105.0||)|
|Profit before tax||170.8||163.7||502.3||504.9|
|Income tax expense||(10.7||)||(4.4||)||(38.6||)||(41.3||)|
|Profit after tax||160.1||159.3||463.7||463.6|
|Share of associate’s results||(2.3||)||(4.3||)||(7.4||)||(7.9||)|
|Profit attributable to equity holders of the parent||157.7||154.6||456.4||446.7|
Quarterly development of operating results
|In euro millions||
|Average U.S. dollar exchange rate||1.4388||1.3641||1.3185||1.2991||1.2495|
Transponder utilisation by Regional Coverage
|In 36 MHz-equivalent||
|North America Utilised||307||302||296||301||297|
|North America Available||415||392||390||388||388|
|North America %||74.0%||77.0%||75.9%||77.6%||76.5%|
Revenue by Regional Coverage
(In euro millions)
|Q3 2012||Q3 2011||
At constant FX
(In euro millions)
|Q3 2012||Q3 2011||Change (%)||YTD Q3 2012||YTD Q3 2011||Change (%)|
Analysis by Business Segment
|In euro millions||
|YTD Q3 2012|
|YTD Q3 2011|
1 Unallocated Corporate charges
Additional information is available on our website www.ses.com
A call for investors and analysts will be hosted at 14.00 CET today, 9 November 2012. Participants are invited to call the following numbers five minutes prior to this time.
|Belgium||+32 (0)2 620 0137|
|France||+33 (0)1 70 48 01 63|
|Germany||+49 (0)69 2999 3285|
|Luxembourg||+352 2088 1429|
+44 (0)20 3450 9571
|USA||+1 646 254 3373|
A presentation, which will be referred to during the calls, will be available for download from the Investor Relations section of our website www.ses.com
A replay will be available for one week on our website: www.ses.com
Disclaimer / “Safe Harbor” Statement
This presentation does not, in any jurisdiction, and in particular not in the U.S., constitute or form part of, and should not be construed as, any offer for sale of, or solicitation of any offer to buy, or any investment advice in connection with, any securities of SES nor should it or any part of it form the basis of, or be relied on in connection with, any contract or commitment whatsoever.
No representation or warranty, express or implied, is or will be made by SES, its directors, officers or advisors or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this presentation, and any reliance you place on them will be at your sole risk. Without prejudice to the foregoing, none of SES or its directors, officers or advisors accept any liability whatsoever for any loss however arising, directly or indirectly, from use of this presentation or its contents or otherwise arising in connection therewith.
This presentation includes “forward-looking statements”. All statements other than statements of historical fact included in this presentation, including, without limitation, those regarding SES’ financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to SES products and services) are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of SES to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding SES and its subsidiaries and affiliates, present and future business strategies and the environment in which SES will operate in the future and such assumptions may or may not prove to be correct. These forward-looking statements speak only as at the date of this presentation. Forward-looking statements contained in this presentation regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. SES and its directors, officers and advisors do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
In a recent research, analyst firm IDC found that the average cost of a critical application failure is $500,000 to $1 million per hour and the average total cost of unplanned application downtime is $1.25 billion to $2.5 billion per year for Fortune 1000 companies. In addition to the findings on the cost of the downtime, the research also highlighted best practices for development, testing, application support, infrastructure, and operations teams.
Jul. 29, 2015 05:30 PM EDT
"We specialize in testing. DevOps is all about continuous delivery and accelerating the delivery pipeline and there is no continuous delivery without testing," noted Marc Hornbeek, Sr. Solutions Architect at Spirent Communications, in this SYS-CON.tv interview at @DevOpsSummit, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 29, 2015 05:15 PM EDT Reads: 360
How do you securely enable access to your applications in AWS without exposing any attack surfaces? The answer is usually very complicated because application environments morph over time in response to growing requirements from your employee base, your partners and your customers. In his session at @DevOpsSummit, Haseeb Budhani, CEO and Co-founder of Soha, shared five common approaches that DevOps teams follow to secure access to applications deployed in AWS, Azure, etc., and the friction an...
Jul. 29, 2015 04:30 PM EDT Reads: 497
"Alert Logic is a managed security service provider that basically deploys technologies, but we support those technologies with the people and process behind it," stated Stephen Coty, Chief Security Evangelist at Alert Logic, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 29, 2015 04:15 PM EDT Reads: 323
Digital Transformation is the ultimate goal of cloud computing and related initiatives. The phrase is certainly not a precise one, and as subject to hand-waving and distortion as any high-falutin' terminology in the world of information technology. Yet it is an excellent choice of words to describe what enterprise IT—and by extension, organizations in general—should be working to achieve. Digital Transformation means: handling all the data types being found and created in the organizat...
Jul. 29, 2015 04:00 PM EDT Reads: 1,066
The essence of cloud computing is that all consumable IT resources are delivered as services. In his session at 15th Cloud Expo, Yung Chou, Technology Evangelist at Microsoft, demonstrated the concepts and implementations of two important cloud computing deliveries: Infrastructure as a Service (IaaS) and Platform as a Service (PaaS). He discussed from business and technical viewpoints what exactly they are, why we care, how they are different and in what ways, and the strategies for IT to tran...
Jul. 29, 2015 03:15 PM EDT Reads: 396
The Internet of Everything (IoE) brings together people, process, data and things to make networked connections more relevant and valuable than ever before – transforming information into knowledge and knowledge into wisdom. IoE creates new capabilities, richer experiences, and unprecedented opportunities to improve business and government operations, decision making and mission support capabilities.
Jul. 29, 2015 03:15 PM EDT Reads: 237
The Software Defined Data Center (SDDC), which enables organizations to seamlessly run in a hybrid cloud model (public + private cloud), is here to stay. IDC estimates that the software-defined networking market will be valued at $3.7 billion by 2016. Security is a key component and benefit of the SDDC, and offers an opportunity to build security 'from the ground up' and weave it into the environment from day one. In his session at 16th Cloud Expo, Reuven Harrison, CTO and Co-Founder of Tufin,...
Jul. 29, 2015 03:00 PM EDT Reads: 466
The Internet of Things is not only adding billions of sensors and billions of terabytes to the Internet. It is also forcing a fundamental change in the way we envision Information Technology. For the first time, more data is being created by devices at the edge of the Internet rather than from centralized systems. What does this mean for today's IT professional? In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists addressed this very serious issue of pro...
Jul. 29, 2015 03:00 PM EDT Reads: 1,256
With SaaS use rampant across organizations, how can IT departments track company data and maintain security? More and more departments are commissioning their own solutions and bypassing IT. A cloud environment is amorphous and powerful, allowing you to set up solutions for all of your user needs: document sharing and collaboration, mobile access, e-mail, even industry-specific applications. In his session at 16th Cloud Expo, Shawn Mills, President and a founder of Green House Data, discussed h...
Jul. 29, 2015 02:30 PM EDT Reads: 322
Container technology is sending shock waves through the world of cloud computing. Heralded as the 'next big thing,' containers provide software owners a consistent way to package their software and dependencies while infrastructure operators benefit from a standard way to deploy and run them. Containers present new challenges for tracking usage due to their dynamic nature. They can also be deployed to bare metal, virtual machines and various cloud platforms. How do software owners track the usag...
Jul. 29, 2015 02:30 PM EDT
Discussions about cloud computing are evolving into discussions about enterprise IT in general. As enterprises increasingly migrate toward their own unique clouds, new issues such as the use of containers and microservices emerge to keep things interesting. In this Power Panel at 16th Cloud Expo, moderated by Conference Chair Roger Strukhoff, panelists addressed the state of cloud computing today, and what enterprise IT professionals need to know about how the latest topics and trends affect t...
Jul. 29, 2015 02:00 PM EDT Reads: 1,169
"Our biggest growth area has been the security services, the managed services - the things that differentiate us in the market that there is no client that's too small and there's no client that's too big," explained Paul Mazzucco, Chief Security Officer at TierPoint, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 29, 2015 02:00 PM EDT Reads: 372
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Jul. 29, 2015 01:45 PM EDT Reads: 423
Containers are changing the security landscape for software development and deployment. As with any security solutions, security approaches that work for developers, operations personnel and security professionals is a requirement. In his session at DevOps Summit, Kevin Gilpin, CTO and Co-Founder of Conjur, will discuss various security considerations for container-based infrastructure and related DevOps workflows.
Jul. 29, 2015 01:00 PM EDT Reads: 1,060