Eutelsat reports good channel growth

February 14, 2014 08.13 Europe/London By Robert Briel

Eutelsat -RThe impact of the suspension of operations on certain frequencies at the 28.5 degrees East orbital position since October 4, 2013 was offset by good dynamic at video neighbourhoods serving broadcasters in fast-growing markets.

Reporting on the first six months of its 2013-2014 year, Eutelsat said that it experienced growth notably at 16 degrees East (addressing Central Europe, Indian Ocean Islands, sub-Saharan Africa) and 36 degrees East (addressing Russia and sub-Saharan Africa).

Capacity sales at the 7 degrees/8 degrees West neighbourhood (addressing the Middle East and North Africa) also benefited from resources added with the redeployment in mid-September of Eutelsat 8 West C (formerly Hot Bird 13A) to this position.

A number of contracts announced during first half reflect sustained demand in video markets:

At 7/8 degrees West: one 72 MHz transponder signed with Telediffusion d’Algerie on the Eutelsat 7 West A satellite;

At 7 degrees East: a long-term contract concluded with Azam Media for 108 MHz of capacity on the Eutelsat 7A satellite, to broadcast a new pan-African pay-TV platform;

At the Hot Bird neighbourhood: a new contract for additional capacity with Cyfrowy Polsat and the extension of its existing lease of capacity. A total of six Hot Bird transponders are now leased by Cyfrowy Polsat and its wholly-owned broadcasting company, Telewizja Polsat;

At 16 degrees East: a contract was concluded with Telekom Austria Group on the Eutelsat 16A satellite to support its new white label DTH platform for Central and Eastern Europe telecom operators and broadcasters.

Good channel growth at Eutelsat’s main video neighbourhoods demonstrates the positive underlying trend in the Group’s main application. At December 31, 2013, the total number of channels broadcast by Eutelsat satellites stood at 4,807, up 7% (+322 channels) year-on-year despite the impact of the suspension of operations on the previously disputed frequencies at 28.5 degrees East (-170 channels). Growth was particularly dynamic at 7/8 degrees West (+17%, or +107 channels), 16 degrees East (+26%, or +153 channels), 7 degrees East (+42%, or +91 channels) and 36 degrees East (+14%, or +103 channels).

HDTV take-up across the fleet continued to accelerate. At end-December 2013, 508 of the channels broadcast by Eutelsat satellites were in HD, up from 398, implying an HD penetration rate of 10.6% compared to 8.9% at 31 December 2012.

As of 31 December 2013, some 240 channels were broadcasting through Satmex’s satellites. Including Satmex, the Group’s fleet now broadcasts more than 5,000 channels.

“In Video Applications, our main neighbourhoods saw good channel growth demonstrating a positive underlying trend. The performance of this activity in the first half reflects a lack of available capacity, which will be addressed with future fleet deployments, and the impact of the suspension of operations on certain frequencies at 28.5 degrees East.

“The performance of Data was more than offset by the growing contribution from Value-Added Services which is benefiting from our new commercial impetus. Multi-usage revenues held up well thanks to the integration of Eutelsat 172 A and new contracts,” said Michel de Rosen, Chairman and CEO of Eutelsat Communications, in a statement.

“The acquisition of Satmex was closed on January 1, 2014, its financing secured with a successful €930 million 6-year bond issue in December. With Satmex, we are significantly upscaling in Latin America to add to our strong presence in other fast-growing markets.

“Our deployment plan for the remainder of the current and coming two years will bring additional capacity that will principally serve video markets in the fastest growing regions, notably Latin America, Russia, the Middle East and Africa.”