Eutelsat Communications Sa · EURONEXT:ETL
Eutelsat Communications Sa — Q3 2018-19 Earnings Presentation
23 slides from Eutelsat Communications Sa's earnings presentation, May 14, 2019
Slide 1: Third Quarter 2018-19 Revenues
THIRD QUARTER 2018-19 REVENUES 14 May 2019
Slide 2: Agenda
Agenda 1 Highlights 2 Q3 2018-19 Performance 3 Outlook 2
Slide 3: Highlights
Highlights Positive impact of change in tax treatment of circa €70m1 in FY 19 Total Video stable q-o-q with slight growth in pure Broadcast Commercial wins in Maritime Mobility Konnect Africa: confirmation of strong demand; ramp-up delayed by temporary operational issues FY19 revenue objective adjus
Slide 4: Agenda: Q3 2018-19 performance
Agenda 1 Highlights 2 Q3 2018-19 performance 3 Outlook 4
Slide 5: Q3 Revenues
Q3 Revenues Q3 REVENUE BRIDGE (€M) ► Third Quarter revenues of €337m, up 0.7% ► Negative perimeter effect • Deconsolidation of Eutelsat 25B 12 -4.0% ► Positive currency effect • €/$ rate of 1.14 versus 1.21 last 8 year (4) (13) ► Positive swing of €12m in ‘Other Revenues’ 334 337 • Net of negative h
Slide 6: Q3 2018-19 revenues by application
Q3 2018-19 revenues by application REVENUE REVENUES LIKE-FOR-LIKE2 CHANGE CONTRIBUTION1 (€m) YoY QoQ CORE BUSINESSES Video 67% 215 -2.5% +0.0% Government 12% 10% 40 -1.0% +0.2% Services Fixed Data 9% 30 -17.8% -7.3% CONNECTIVITY Fixed 6% 19 -9.7% -5.3% Broadband Mobile Connectivity 6% 20 +4.7% +1.3%
Slide 7: Video
Video REVENUES (€M) ► Revenues of €215m, down 2.5% like-for-like1 on a y-o-y basis ► Accelerated decline in Professional Video • Double-digit decline • Intensifying competitive pressure Q4 216 • Now less than 8% of Video revenues ► Core broadcast stable Q3 218 Q3 215 ► Stable revenues Q-o-Q • Slight
Slide 8: Continued rise in channel count
Continued rise in channel count 6,880 +3% 7,021 (89) 6,791 Progressing channel count March 2018 25B March 2018 ex. 25B March 2019 1,358 (54) 1,304 +16% 1,509 Sustained HD ramp-up Penetration 20% 19% 22% March 2018 25B March 2018 ex. 25B March 2019 4,550 (55) 4,495 +7% 4,818 MPEG-4 more advanced Pene
Slide 9: Focus on HOTBIRD KPIs
Focus on HOTBIRD KPIs CHANNEL COUNT HD PENETRATION MPEG 4 +14% 357 567 +4% 592 312 1009 -39 970 31% 37% 56% 61% Penetration Penetration March 2018 March 2019 March 2018 March 2019 March 2018 March 2019 ► Unique channels broadly stable ► HD ramp-up ► MPEG-4 considerably outpacing MPEG-4 more advanced
Slide 10: Government Services
Government Services REVENUES (€M) ► Revenues of €40m, down 1.0% y- o-y like-for-like1 • Carry-forward effect of incremental business over APAC Q4 40 at 174°East • Low outturn of the Fall 2018 Q3 38 Q3 40 renewal campaign with USG ► Revenues stable Q-o-Q Q2 39 Q2 39 ► USG renewal rate of c.85% in Q1
Slide 11: Fixed Data
Fixed Data REVENUES (€M) ► Revenues of €30m, down 17.8% y-o-y like-for-like1 ► Environment remains highly Q4 34 competitive ► Ongoing pricing pressure Q3 35 Q3 30 ► Softer volumes in Latin America Q2 36 in Q3 Q2 33 Q1 37 Q1 33 FY 2017-18 2 FY 2018-19 1 At constant currency and perimeter 2 Proforma r
Slide 12: Fixed Broadband
Fixed Broadband REVENUES (€M) ► Revenues of €19m, down 9.7% y-o-y like-for-like1 ► Contract expiry for a spotbeam on ETL3B, re-contracted in Mobility • Accounting for c.2 points of decline Q4 21 ► Lower European Broadband revenues Q3 21 • Scarcity of capacity in certain Q3 19 countries • Transition
Slide 13: European Broadband: transition to new distribution model
European Broadband: transition to new distribution model LIMITATIONS OF EXISTING MULTIPLE ADVANTAGES OF NEW …DELIVERING PROMISING EARLY WHOLESALE DISTRIBUTION MODEL PPP SCHEME…. RESULTS ► Fragmented base ► Focus on few a ► Acceleration in gross selected partners adds for PPP ► Many small distributor
Slide 14: Konnect Africa: Temporary operational issues not reflective of strong market demand
Konnect Africa: Temporary operational issues not reflective of strong market demand TEMPORARY OPERATIONAL EVIDENCE OF STRONG REVENUES SET TO RAMP-UP ISSUES UNDERLYING DEMAND IN DRC FROM FY 20 ► Political ► Rapid acceleration in ► DRC: go-direct model • Internet shut down in kit orders once validated
Slide 15: Mobile Connectivity
Mobile Connectivity REVENUES (€M) ► Revenues of €20m, up 4.7% y-o-y like-for-like1 ► Start of UnicomAirNet contract on EUTELSAT 172B ► Carry-forward of contract with Q4 20 Taqnia at 3°East and 70°East Q3 18 Q3 20 ► Ongoing ramp up of capacity contracts on KA-SAT Q2 19 Q2 19 ► Two commercial wins in
Slide 16: Backlog and Fill Rate
Backlog and Fill Rate BACKLOG (€BN) OPERATIONAL AND UTILIZED TRANSPONDERS 1424 1419 1418 4.6 4.6 4.4 951 970 960 Video 83% 77% 76% 31 March 2018 31 Dec. 2018 31 March 2019 31 March 2018 31 Dec. 2018 31 March 2019 Fill 66.8% 68.3% 67.7% rate ► 3.1 years of revenues Operational transponders Utilized t
Slide 17: Agenda: Outlook
Agenda 1 Key Highlights 2 Q3 2018-19 performance 3 Outlook 17
Slide 18: Financial outlook
Financial outlook OPERATING VERTICALS ► c. -3% in FY 2018-191 VERSUS BROADLY STABLE PREVIOUSLY REVENUES (At constant currency, perimeter and ► Returning to slight growth in FY 2019-20 accounting standards) CONFIRMED EBITDA MARGIN ► Above 78% from FY 2018-19 (At constant currency) CONFIRMED CAPEX ► F
Slide 19: Several elements underpinning revenues in FY 20
Several elements underpinning revenues in FY 20 ► New capacity on EUTELSAT 7C adressing SSA VIDEO ► Materialization of Video pipeline ► Initial revenues from Cirrus ► Contribution from EGNOS GOVERNMENT ► Entry into service of EUTELSAT QUANTUM FIXED ► Ramp-up of Konnect Africa BROADBAND ► Benefits of
Slide 20: To Sum Up
To Sum Up Core Broadcast business showing strong resilience Current year topline adjustment reflects delays in Fixed Broadband and Video and tougher conditions in Fixed Data and Professional Video All our other objectives are confirmed with next year revenues supported by new capacity and other tail
Slide 21: Appendix
APPENDIX
Slide 22: Future launches
Future launches EUTELSAT EUTELSAT KONNECT EUTELSAT EUTELSAT Name 7C 5 WEST B KONNECT VHTS HOTBIRD HOTBIRD 13F 13G Orbital 7° East 5° West TBD TBD TBD 13° East 13° East Position Launch date1 June 2019 Q3 2019 H2 2019 Q4 2019 H2 2021 H2 2021 H2 2021 Manufacturer Launcher TBD TBD TBD MENA Europe Flexib
Slide 23: Disclaimer
Disclaimer This presentation does not constitute or form part of and should not be construed as any offer for sale of or solicitation of any offer to buy any securities of Eutelsat Communications, nor should it, or any part of it, form the basis of or be relied on in connection with any contract or
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