SES, the leader in global content connectivity solutions, announces its financial results for 2021.
Stable return with revenue of € 1,782 million and adjusted EBITDA of € 1,091 million, reaching the financial prospect ceiling
– Improvement of the course of Video (-4.6% on an annual basis in 2021 compared to -8.0% on an annual basis in 2020) in view of the financial prospects of the Group.
– Durable Network performance, with + 0.5% on an annual basis within an environment affected by COVID.
– Adjusted Net Profit amounts to 323 million euros, while at the same time an increase of 69% is recorded, including the benefit of lower recurring operating expenses, depreciation and interest.
– Proposed dividend 2021 (paid in 2022) was € 0.50 per domestic share, representing a 25% increase on an annual basis.
On the trajectory of raising increased revenues and EBITDA for 2022 and increasing the long-term value of diversified development investments
– About 85% of the Group’s prospective revenues for 2022 (1,750-1,810 million euros) has already been achieved and is under contract.
– The adjusted EBITDA outlook for 2022 (€ 1,030-1,070 million) reflects strong profitability despite the additional cost of promoting Network development.
– Over $ 900 million outstanding volume for SES-17 (in service in mid-2022) & O3b mPOWER (service introduction in late 2022).
Steve Collar, CEO of SES, commented: “2021 was a strong year for SES with revenue and adjusted EBITDA in line with our objectives, securing over € 1.2 billion in commercial renewals, while at the same time recording new business as well as an increase in our Adjusted Net Profit, which highlights the importance we attach to all cost lines.At the same time, our net debt on EBITDA has reached a low of 6 years.
The video service marked an improved course, while at the same time we proceeded with renewals with the long-term broadcasting partners. We also increased the number of HD TV channels while expanding the HD + service in Germany. Our Networks activities have also performed well, taking into account the fluid conditions due to COVID, with the return to normal conditions for mobility services contributing to the positive growth from year to year in the second half of 2021, which we expect to accelerate in 2022.
2021 was also a pivotal year for our C-band initiative in the US, as we completed the first phase of clearing ahead of the FCC deadline and received $ 977 million (before tax) in fast relocation payments. The second phase is in full swing with 2022 being a busy year for us, with many satellite launches paving the way for an additional $ 3 billion incentive by the end of 2023.
We look to the future with optimism as in 2022 we will introduce the network of the future, with SES-17 entering commercial service in July and the first services at O3b mPOWER being delivered before the end of the year. Customer engagement is steadily rising, with nearly $ 1 billion in outstanding debt already signed, including five of the top six cruise companies, Microsoft, Marlink and a landmark joint venture with Reliance Jio. We also welcome the progress made by the European Commission in defining a secure and sovereign European multi-track space architecture that aligns well with both our infrastructure and our vision.
Finally, in 2021 we returned 275 million euros in cash to shareholders, highlighting our commitment to stable and attractive returns to shareholders. The increase of the basic dividend for 2021 by 25% reflects our confidence in the fundamental figures of long-term growth and value creation “.
Video: 59% of the group’s revenue
As of December 31, 2021, SES provided a total of 8,386 TV channels (1% year-on-year increase) to more than 355 million households worldwide. These include 3,105 high definition TV channels, which is an increase of 6% compared to 31 December 2020. 71% of the total TV channels transmitted via the SES network are broadcast in MPEG-4 with an additional 5% for transmission in HEVC.
The impact of customer adjustment on mature markets (Western Europe and the US), lower wholesale wholesale revenue in the US and the decision to reduce exposure to low margin services has led to an overall decline in revenue from year to year, albeit by slower rate of decline compared to trends in 2020 and 2019.
The initial benefit from the cost increase for renewing a 12-month subscription implemented in March 2021 and the continued increase in the average number of subscribers led to an annual increase for HD + service in Germany. Looking ahead, the full annual contribution from the price increase and the introduction of new Internet Protocol-based solutions, such as HD + ToGo (released in October 2021) and HD + IP (released in February 2022), are expected to support future development of the business.
In addition, international market revenues were stable from year to year, while revenues from the “Sports & Events” category continue to recover, with improved performance compared to 2020 affected by the cancellations and delays caused by the pandemic COVID.
Networks: 41% of the Group’s revenues
In governance, the positive contribution from new networks and MEO and GEO-enabled institutional solutions for both US and worldwide customers has led to an annual increase in revenue compared to 2020. This was partially offset by the cancellation of services in the third quarter of 2021 as a result of the US withdrawal from Afghanistan.
For fixed data, underlying revenues fell by a single-digit low compared to the previous year, as lower annual revenues in the Pacific and wholesale companies in Africa had not yet balanced with the continued growth of start-ups from the first mobile network providers, especially in the Americas and Asia, as well as new revenue in the global cloud sector.
In the field of Mobility, the prolonged impact of the COVID pandemic on customers operating in the commercial aviation and cruise sectors has helped to reduce revenue compared to 2020. This has been partially offset by the positive annual return on merchant shipping revenue. . Long-term fundamentals remain strong with revenue streak improving in the second half of 2021, reflecting the cruise recovery as ships reopen and new businesses provide additional capacity to commercial aviation customers.
Future satellite launches
In October 2021, the SES-17 was successfully launched by Arianespace. This high-bandwidth Ka band satellite is expected to enter commercial service by mid-2022 and will offer broadband connectivity in the Americas, the Caribbean and the Atlantic Ocean. Thales Avionics is a key customer and will use SES-17 to provide connectivity solutions for commercial airline customers in North America.
In November 2021, SES ordered two Ku-band geostationary satellites for its main orbital socket at 19.2 degrees East to maintain the premium services it provides to European video customers and capture new opportunities in the region. These two replacement satellites (ASTRA 1P and ASTRA 1Q) are expected to replace the four satellites (ASTRA 1KR, ASTRA 1L, ASTRA 1M and ASTRA 1N) that are currently serving customers at this orbital location, achieving significant performance reduction and capital expenditures at 19.2 degrees East by more than 50%.
Source: Capital
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