Video declining yearly but stable quarterly at end of SES Q3
Details
Joseph O'Halloran
| 05 November 2020
Having for a prolonged period reported a sequential decline in its video business while reporting gains in networks, leading satellite operator SES has reported solid overall performance in its first nine months of the year with video declines continuing on a yearly basis but levelling off quarterly.
SES YTD 2020 5 Nov 2020

For the nine month period ended 30 September 2020, the Luxembourg satellite provider reported group revenue of €1.410 billion including €9 million of periodic and other revenue, half that generated by the same time in 2019. Underlying revenue, excluding periodic and other, declined by 2.3% year-on-year at constant FX to €1.401 billion.

Video business underlying revenue was €832 million for the nine-month period, down 8.1% at constant FX reflecting said the company the combination of lower distribution revenue, down 7.3% on an annual basis, which SES said was from the ‘right-sizing’ of capacity by customers in mature markets, and lower services revenue, down 10.3% year-on-year to €204 million, due to reduced exposure to low margin activities and the impact of Covid-19 on sports and events revenue.

Video distribution revenue for the nine months was €628 million, down 7.6% compared with the first nine months of 2019. SES did stress that Q3 2020 underlying
revenue of €273 million was in line with the previous quarter at constant FX.

By contrast to the challenges in the video line, networks underlying revenue grew, for the third consecutive year, by 7.5% at constant FX to €569 million with double-digit growth in mobility, up 17.9% annually, and a return to growth in fixed data, a 6.4% yearly increase, while overall networks revenue totalled €189 million in Q3 2020.

SES CEO Steve Collar said the solid third quarter performance occurred despite ongoing Covid-19 headwinds. Commenting on the highlights of the quarter he said: “We were delighted to announce a substantial extension of our relationship with Canal+ across three orbital locations and valued at over €230 million, as well as a meaningful extension of our strategic partnership with Microsoft as an Azure Orbital connectivity partner and satellite partner for Azure Modular Data Centres. We took measures early in the development of the Covid-19 pandemic to protect the bottom line and the benefits of these cost-saving measures are reflected in our resilient adjusted EBITDA performance. Execution remains the priority with the business well placed to deliver on our full year outlook.”