TIDMETL
Eutelsat Communications (ISIN: FR0010221234 - Euronext Paris /
London Stock Exchange: ETL) (Paris:ETL) reports revenues for the
First Quarter ended 30 September 2023.
In EUR millions Q1 2022-23 Q1 2023-24 Change
Reported Like-for-like(2)
Video 183.5 163.5 -10.9% -9.5%
Government Services 34.7 33.5 -3.4% 1.1%
Mobile Connectivity 25.9 35.2 35.5% 44.1%
Fixed Connectivity 46.4 40.2 -13.2% -2.6%
Total Operating Verticals 290.5 272.5 -6.2% -2.4%
Other Revenues(3) -3.1 1.5 na na
Total 287.4 274.0 -4.7% -0.8%
EUR/USD exchange rate 1.02 1.09
HIGHLIGHTS
-- Operating Vertical revenues of EUR273m, down 2.4% like-for-like on a
year-on-year basis. They rose by 2.9% on a sequential basis
(quarter-on-quarter), excluding a one-off contract booked in Government
services in Q4 FY 2022-23.
-- Continued robust double-digit growth in Mobile Connectivity:
-- Commercialization of the final beam on EUTELSAT QUANTUM. All of
the satellite's capacity is now commercialized, just 18 months
following its entry into service.
-- Multi-year, multi-million euro contract with Marlink, for
capacity on EUTELSAT 10B for maritime Connectivity in EMEA.
-- Successful entry into service of the EUTELSAT KONNECT VHTS satellite,
driving connectivity growth with 500 Gbps of incremental capacity and
firm commitments totalling c.EUR450m.
-- Eutelsat/OneWeb combination project approved on 28 September 2023.
-- All financial objectives for Eutelsat Group are confirmed; they replace
Eutelsat standalone objectives.
-- Further strong commercial momentum at OneWeb; backlog close to $1.0bn4,
up 66% year-on-year.
FIRST QUARTER REVENUES(5)
Total revenues for the First Quarter stood at EUR274 million,
down 4.7% on a reported basis, and by 0.8% like-for-like.
Revenues of the four Operating Verticals (ie, excluding 'Other
Revenues') stood at EUR273 million. They were down by 2.4% on a
like-for-like basis excluding a negative currency effect of EUR8
million, as well as a negative perimeter effect of c. -1 point from
the disposal of the BigBlu retail broadband operations in late June
2023.
Quarter-on-quarter, revenues of the four Operating Verticals
were down by 2.3% like-for-like. Excluding a one-off contract
booked in Q4 FY 2022-23 in Government Services(6) , revenues of the
four Operating Verticals were up by 2.9% like-for-like.
Note: Unless otherwise stated, all variations indicated
hereunder are expressed on a like-for-like basis, ie, at constant
currency and perimeter.
Video (60% of revenues)
First Quarter Video revenues amounted to EUR164 million, down
9.5% year-on-year, reflecting the impact of the early non-renewal
of a capacity contract with Digitürk from mid-November 2022. They
were also impacted by the effect of sanctions against certain
Russian and Iranian channels.
Professional Video revenues, which account for under 10% of the
Video vertical, also decreased, reflecting lower occasional
use.
On a quarter-on-quarter basis, revenues were down by 3.4%,
reflecting lower revenues in Europe.
Looking ahead, Video revenues are expected broadly in line with
the wider market trend of a mid-single digit decline, excluding the
effect of Russian and Iranian sanctions which will be embarked for
a full 12 months versus six months in FY 2022-23.
Government Services (12% of revenues)
First Quarter Government Services revenues stood at EUR34
million, up 1.1% year-on-year. This rise reflected the contribution
of the EGNOS GEO-4 contract on HOTBIRD 13G.
On a quarter-on-quarter basis, revenues were down by 25.2%.
Excluding the abovementioned one-off DLR contract in Q4 FY 2022-23
(c. EUR14 million), First Quarter revenues were up 9.5% on a
quarter-on-quarter basis, on the back of increasing traction with
European customers.
The latest renewal campaign with the US Department of Defence
(Fall 2023) resulted in a slightly improved renewal rate of above
80%.
Over the Full Year, Government Services revenues will benefit
from the abovementioned EGNOS Geo-4 contract on HOTBIRD 13G, set to
generate EUR100m in revenues over 15 years, as well as the
contribution from OneWeb's LEO-enabled connectivity solutions,
offering global coverage and lower latency.
Mobile Connectivity (13% of revenues)
First Quarter Mobile Connectivity revenues stood at EUR35
million, up 44.1 % year-on-year. This reflected the
commercialization of the final beam on EUTELSAT QUANTUM for a
maritime mobility client. The eight beams of this satellite are now
fully commercialized, just 18 months after its entry into
service.
Revenues also benefited from the entry into service of the
high-throughput satellite, EUTELSAT 10B, with significant
pre-commitments and recent deals, especially in Maritime, such as
the multi-year, multi-million contract with Marlink, a leading
provider of connectivity solutions.
On a quarter-on-quarter basis, revenues were up by 29.8%.
For the Full Year, Mobile Connectivity is expected to see
double-digit growth driven by strong demand for both GEO and
LEO-based connectivity solutions.
Fixed Connectivity (15% of revenues)
First Quarter Fixed Connectivity revenues stood at EUR40
million, down by 2.6% year-on-year. They include the contribution
from the wholesale agreements with Orange, TIM, Hispasat and
Swisscom, which is now fully embarked.
On a quarter-on-quarter basis, revenues were up 6.5%, notably on
the back of the resale of OneWeb capacity for data usages in
Alaska.
Over the Full Year, Fixed Connectivity is set to deliver
double-digit growth on the back of the entry into service of
KONNECT VHTS as well as the contribution from LEO connectivity
offers.
Other Revenues
'Other Revenues' amounted to EUR2 million in the First Quarter
versus minus EUR3 million a year earlier and minus EUR5 million in
the Fourth Quarter of FY 2022-23. They included a neutral impact
from hedging operations in the First Quarter versus negative
impacts of respectively EUR5m in the First Quarter, and EUR1
million in the Fourth Quarter of 2022-23.
BACKLOG
The backlog stood at EUR3.4 billion at 30 September 2023,
broadly stable versus end-June 2023. The consumption of the Video
backlog, in the absence of major renewals, was offset by strong
commercial momentum in Connectivity, reflecting the rebalancing of
the business towards growth verticals. The backlog was equivalent
to 3.0 times FY 2022-23 revenues, with Video representing 57% of
the total.
30 Sep 2022 30 Jun 2023 30 Sep 2023
Value of contracts (in billions of
euros) 3.9 3.4 3.4
In years of annual revenues 3.4 3.0 3.0
Share of Video 63% 59% 57%
Note: The backlog represents future revenues from capacity or
service agreements and can include contracts for satellites
under procurement. Managed services are not included in the
backlog.
OneWeb's backlog amounted to c. $1bn at end-September 2023. It
included the $275m Take-or-Pay Agreement signed with Eutelsat in
July 2022.
OUTLOOK AND FINANCIAL TARGETS
Following the approval in late September 2023 of the combination
with OneWeb, the financial objectives of Eutelsat Group replace the
previous financial objectives of Eutelsat standalone.
These financial objectives are confirmed as follows (at a EUR/$
rate of 1.00):
-- Revenues of Eutelsat Group are expected to grow at a double-digit
revenue CAGR over the medium to long-term, reaching EUR1.32-1.42bn in FY
2024, EUR1.55-1.75bn in FY 2025, and c. EUR2.0bn in FY 2027.
-- Adjusted EBITDA for Eutelsat Group is expected to grow at a double
digit CAGR over the same period, outpacing revenues growth, rising from a
range of EUR725m to EUR825m in FY 2024 to EUR900m to EUR1.1bn in FY 2025,
and c. EUR1.4bn in FY 2027.
-- After synergies, the cash capex of Eutelsat Group is estimated to be at
EUR725m to EUR875m per annum on average, over the period FY 2024 to FY
2030, with a front-end loaded profile.
-- Leverage, which stood at c. 4x net debt / adjusted EBITDA pro forma end
of June 2023, is expected to be reduced on the back of strong adjusted
EBITDA growth, backed by a disciplined financial policy, with an
objective of leverage of c. 3x in the medium term.
Note: This outlook is based on the revised nominal deployment
plan outlined in the Q1 2023-2024 revenue presentation. It assumes
no further material deterioration of revenues generated from
Russian customers.
CORPORATE GOVERNANCE
Upcoming Annual General Meeting
The Board of 10 October 2023 proposed, amongst others, the
following resolutions to be submitted to the vote of shareholders
at the Annual General Meeting to be held 23 November 2023:
-- Approval of the accounts.
-- Compensation of corporate officers and compensation policy.
-- Authorisation to the Board of Directors to purchase the Company's
shares and, if necessary, to cancel them.
*******
First Quarter 2023-24 revenues conference call & webcast
A conference call & webcast will be held on Thursday, 26
October at 09.00am CET.
Click here to attend the webcast presentation
If needed, please dial one of these numbers:
+33 (0)1 7037 7166 (from France)
+44 (0)33 0551 0200 (from the U.K)
Quote "Eutelsat" to the operator when connecting to the call
Replay will be available on same link
Financial calendar
Note: The financial calendar is provided for information
purposes only. It is subject to change and will be regularly
updated.
-- 23 November 2023: Annual General Shareholders' Meeting
-- 16 February 2024: First Half 2023-24 results
About Eutelsat Communications
Eutelsat Group is a global leader in satellite communications,
delivering connectivity and broadcast services worldwide. The Group
was formed through the combination of Eutelsat and OneWeb in 2023,
becoming the first fully integrated GEO-LEO satellite operator with
a fleet of 36 Geostationary satellites and a Low Orbit earth
constellation of more than 600 satellites.
The Group addresses the needs of customers in four key verticals
of Video, where it distributes more than 6,500 television channels,
and the high-growth connectivity markets of Mobile Connectivity,
Fixed Connectivity, and Government Services.
Eutelsat Group's unique suite of in-orbit and on-ground assets
enables it to deliver integrated solutions to meet the needs of
global customers. The Company is headquartered in Paris and
Eutelsat Group employs more than 1,700 from 50 different
nationalities. The Group is committed to delivering safe,
resilient, and environmentally sustainable connectivity to help
bridge the digital divide. The Company is listed on the Euronext
Paris Stock Exchange and the London Stock Exchange (ticker:
ETL).
Disclaimer
The forward-looking statements included herein are for
illustrative purposes only and are based on management's views and
assumptions as of the date of this document.
Such forward-looking statements involve known and unknown risks.
For illustrative purposes only, such risks include but are not
limited to: risks related to the health crisis; operational risks
related to satellite failures or impaired satellite performance, or
failure to roll out the deployment plan as planned and within the
expected timeframe; risks related to the trend in the satellite
telecommunications market resulting from increased competition or
technological changes affecting the market; risks related to the
international dimension of the Group's customers and activities;
risks related to the adoption of international rules on frequency
coordination and financial risks related, inter alia, to the
financial guarantee granted to the Intergovernmental Organization's
closed pension fund, and foreign exchange risk.
Eutelsat Communications expressly disclaims any obligation or
undertaking to update or revise any projections, forecasts or
estimates contained in this document to reflect any change in
events, conditions, assumptions, or circumstances on which any such
statements are based, unless so required by applicable law.
The information contained in this document is not based on
historical fact and should not be construed as a guarantee that the
facts or data mentioned will occur. This information is based on
data, assumptions and estimates that the Group considers as
reasonable.
APPENDIX
Quarterly Reported revenues
The table below shows quarterly reported revenues.
In EUR millions Q1 Q2 Q3 Q4 FY Q1
2022-23 2022-23 2022-23 2022-23 2022-23 2023-24
Video 183.5 182.4 169.3 169.5 704.8 163.5
Government Services 34.7 32.2 31.4 45.1 143.4 33.5
Mobile Connectivity 25.9 30.0 26.9 27.3 110.1 35.2
Fixed Connectivity 46.4 46.8 44.0 40.6 177.8 40.2
Total Operating
Verticals 290.5 291.4 271.6 282.6 1,136.1 272.5
Other Revenues -3.1 -5.0 0.4 3.0 -4.8 1.5
Total 287.4 286.4 272.0 285.5 1,131.3 274.0
----------------------------
(1) Like-for-like change at constant currency and perimeter.
(2) Change at constant currency and perimeter. The variation is
calculated as follows: i) Q1 2023-24 USD revenues are converted at
Q1 2022-23 rates; ii) the contribution of the BigBlu retail
broadband operations from 1st July 2022 to 30 September 2022 is
excluded from Q1 2022-23 revenues; iii) Hedging revenues are
excluded.
(3) Other Revenues include mainly the impact of EUR/USD revenue
currency hedging, the provision of various services or
consulting/engineering fees and termination fees.
(4) Of which $275m is with Eutelsat.
(5) The share of each application as a percentage of total
revenues is calculated excluding "Other Revenues".
(6) One-off contract of EUR14m with the German space agency,
DLR, whereby EUTELSAT HOTBIRD 13F provided a service from April at
the 0.5degE orbital position, prior to its commissioning at 13degE,
expected in Q3 2023 (calendar).
Eutelsat Group Media Enquiries
Presse - Eutelsat Group
Media
Katie Dowd
kdowd@oneweb.net
Alastair Elwen
+44 20 7251 3801
eutelsatgroup@fgsglobal.com
Armand Noury
+33 6 60 07 16 97
eutelsat@agenceproches.com
Investor
Thomas Cardiel
+33 6 99 07 86 47
tcardiel@eutelsat.com
Hugo Laurens-Berge
hlaurensberge@eutelsat.com
Christine Lopez
clopez@eutelsat.com
View source version on businesswire.com:
https://www.businesswire.com/news/home/20231025201898/en/
CONTACT:
Eutelsat Group
SOURCE: Eutelsat Group
Copyright Business Wire 2023
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