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SES Q1 2024 ResultsSES S.A. announces financial results for the three months ended 31 March 2024 and a solid start to the 2024 financial year.
Adel Al-Saleh, CEO of SES, commented: "The first quarter results demonstrate our solid start to the year, and we continued to deliver commercial momentum across the business, underpinning our FY 2024 financial outlook which is on track and unchanged. Our Networks business now accounts for over 50% of revenue and delivered YOY growth including periodic revenue from a contract modification which allowed us to recontract capacity on our highly contended MEO fleet and generate incremental cash flows. In Video, our Sports & Events offering continued to be the standout performer, adding to its impressive line-up of customers with an exciting new agreement with a global tier one sports brand to distribute live content to audiences across the world. April 2024 delivered a landmark milestone for SES with the entry into commercial service of O3b mPOWER, our next generation MEO constellation, strengthening our capability to deliver competitive and differentiated customer solutions in valuable, high growth government, mobility, and fixed data markets. The next O3b mPOWER satellites (7-8) are on track be launched in late 2024 launch and bring improved resiliency to the network which will be further expanded with the launch of satellites 9-11 plus 12 & 13 in 2025 and late 2026 respectively." Key business and financial highlights (at constant FX unless explained otherwise) SES regularly uses Alternative Performance Measures (APM) to present the performance of the group and believes that these APMs are relevant to enhance understanding of the financial performance and financial position.
Networks (54% of total revenues) revenue of €268 million increased 9.6% year on year driven by growth in Mobility (+24.5% including periodic revenue) and Government (+6.1%). Fixed Data revenue (-0.5% year on year) was in line with Q1 2023 as new revenue added was offset by the impact of periodic revenue recognised in the prior period. Video (46% of total revenues) revenue of €228 million represented a reduction of 5.2% compared with Q1 2023, mainly driven by lower revenue in mature markets which were partially offset by expansion in Sports & Events revenue. Adjusted EBITDA of €275 million represented an Adjusted EBITDA margin of 55% (Q1 2023: 54%). Adjusted EBITDA excludes significant special items of €6 million (Q1 2023: €13 million), comprising net U.S. C-band expenses of €1 million (Q1 2023: net expenses of €4 million) and expense of other significant special items of €5 million (Q1 2023: €9 million). Adjusted Net Profit of €77 million was €13 million, or 20.0%, higher than Q1 2023 mainly reflecting the higher year on year Adjusted EBITDA and net interest income of €6 million (Q1 2023: net interest expense of €23 million) which included the benefit of earning interest income on the group's balance of cash & cash equivalents. Adjusted Net Debt to Adjusted EBITDA ratio (including 50% of €625 million of hybrid bond as debt) on 31 March 2024 was 1.5 times, (31 March 2023: 3.6 times, 31 December 2023: 1.5 times) including cash & cash equivalents of €2,403 million. In January 2024, SES called and repaid the €550 million hybrid bond and expects to repay approximately €450 million of additional upcoming debt maturities. The total amount of remaining U.S. C-band clearing cost reimbursements expected to be received in future is now approximately $480 million and SES is continuing to engage with insurers regarding the claim of $472 million relating to O3b mPOWER satellites 1-4. Contract backlog on 31 March 2024 was €4.0 billion (€5.0 billion gross backlog including backlog with contractual break clauses). The Full Year 2023 dividend of €0.50 per A-share and €0.20 per B-share was paid to shareholders on 18 April 2024. For Full Year 2024, SES will move to a semi-annual distribution with an interim dividend of €0.25 per A-share (€0.10 per B-share) to be paid in October 2024 and final dividend, subject to shareholder approval, of at least €0.25 per A-share (€0.10 per B-share) to be paid in April 2025. The share buyback programme of up to €150 million was started in November 2023 and is being executed under the authorisation given by the Annual General Meeting of shareholders held on 6 April 2023. On 31 March 2024, 9 million A-shares had been purchased at an average price of approximately €5.70 per A-share. The aggregate value of the programme shall not exceed €150 million, and the shares acquired are intended to be cancelled, reducing the total number of voting and economic shares in issue. For Full Year 2024, group revenue and Adjusted EBITDA (assuming an FX rate of €1=$1.09, nominal satellite health, and nominal launch schedule) are expected to be in the range of €1,940-2,000 million and €950-1,000 million respectively, with growth in Networks revenue expected to mostly offset lower year-on-year Video revenue. Capital expenditure (net cash absorbed by investing activities excluding acquisitions, financial investments, U.S. C-band repurposing, and assuming an FX rate of €1=$1.09) is expected to be in the range of €500-550 million in 2024 with an average annual capital expenditure of approximately €350 million for the period 2025-2028. Operational performance
SUPPLEMENTARY INFORMATION
ALTERNATIVE PERFORMANCE MEASURES SES regularly uses Alternative Performance Measures ('APM') to present the performance of the group and believes that these APMs are relevant to enhance understanding of the financial performance and financial position. These measures may not be comparable to similarly titled measures used by other companies and are not measurements under IFRS or any other body of generally accepted accounting principles, and thus should not be considered substitutes for the information contained in the group's financial statements.
Presentation of Results: A presentation of the results for investors and analysts will be hosted at 9.30 CET on 30 April 2024 and will be broadcast via webcast and conference call. The details for the conference call and webcast are as follows:
The presentation is available for download from https://www.ses.com/investors/financial-results and a replay will be available shortly after the conclusion of the presentation.
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About SES SES has a bold vision to deliver amazing experiences everywhere on earth by distributing the highest quality video content and providing seamless data connectivity services around the world. As a leader in global content connectivity solutions, SES owns and operates the world's only geosynchronous orbit and medium earth orbit (GEO-MEO) constellation of satellites with the unique combination of global coverage and high performance. By leveraging its vast and intelligent, cloud-enabled network, SES delivers high-quality connectivity solutions anywhere on land, at sea or in the air, and is a trusted partner to the world's leading telecommunications companies, mobile network operators, governments, connectivity and cloud service providers, broadcasters, video platform operators and content owners. SES's video network carries over 6,400 channels, reaching 363 million households, delivering managed media services for both linear and non-linear content. The company is headquartered in Luxembourg and listed on Paris and Luxembourg stock exchanges (Ticker: SESG). Further information is available at: www.ses.com. Disclaimer This presentation does not, in any jurisdiction, including without limitation 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's 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 occur or 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.
1) At constant FX (comparative figures restated to neutralise currency variations)
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