- Revenues of €697 million, down 5.7%
like-for-like1 and by 1.8% excluding Other
Revenues
- Discretionary Free Cash Flow of €339
million up 8.1% at constant currency
- High level of profitability: EBITDA
margin of 78.4% at constant currency, up 0.5 pts
- Effective capex containment
- LEAP cost-saving program ahead of
track;
- All elements of the Financial
Outlook confirmed for current and future years
This press release contains figures from the consolidated
half-year accounts, prepared under IFRS, and subject to a limited
review by the Auditors. They were reviewed by the Audit Committee
on 6 February 2018 and approved by the Board of Directors of
Eutelsat Communications on 15 February 2018. Furthermore, EBITDA,
EBITDA margin, Net debt / EBITDA ratio, Cash Capex and
Discretionary Free-Cash-Flow are considered as Alternative
Performance Indicators. Their definition and calculation can be
found in appendix 3 of this document.IFRS 15 will be adopted
in the Group's consolidated financial statements for the financial
year beginning 1 July 2018. IFRS 16 will be adopted at the earliest
in the Group's consolidated financial statements for the financial
year beginning 1 July 2018.
Regulatory News:
The Board of Directors of Eutelsat Communications (Paris:ETL)
(ISIN: FR0010221234 – NYSE Euronext Paris: ETL), chaired by
Dominique D’Hinnin, reviewed the financial results for the
half-year ended 31 December 2017.
Key Financial
Data 6 months to Dec. 2016
6 Months to Dec.
2017 Change Revenues - €m
755.1
696.6 -7.7% Revenues at constant
currency and perimeter 748.8
705.7
-5.7%
EBITDA2 - €m
588.0
544.6 -7.4% EBITDA margin
- % 77.9
78.2 +0.3 pts EBITDA
margin at constant currency - % 77.9
78.4
+0.5 pts Group share of net income - €m 192.2
156.5 -18.6% Financial structure
Discretionary Free-Cash-Flow3
324.8
338.8 +4.3% Discretionary
Free-Cash-Flow at constant currency 324.8
351.4 +8.1% Net debt - €m 3,885.0
3,630.3 -€255m Net debt/EBITDA - X
3.4x
3.3x -0.1 pts Backlog –
€bn 5.3
4.7 -11.4%
Commenting on the First Half, Rodolphe Belmer Chief Executive
Officer of Eutelsat Communications, said: “First half results were
in line with our expectations, with the decline in revenues mostly
reflecting, as in the First Quarter, an unfavourable comparison
basis in FY 2017. Profitability was robust, with the EBITDA margin
gaining 0.5 points at constant currency to stand at 78.4%,
reflecting stronger than expected delivery on the Leap cost savings
plan; and we generated an 8% rise in discretionary free cash flow
at constant currency, supported by highly effective capex
containment. The first half also saw a solid commercial
performance, notably in Video and Government services, as well as
the entry into service of EUTELSAT 172B, both of which will support
revenues in the Second Half. The integration of Noorsat, acquired
to optimise Video distribution in the MENA region, is progressing
smoothly. Looking ahead to the remainder of the year, all elements
of our financial objectives are confirmed.”
1 At constant currency and perimeter.2 Operating income before
depreciation and amortisation, impairments and other operating
income/(expenses).3 Net cash-flow from operating activities – Cash
Capex - Interest and Other fees paid net of interests received.
KEY EVENTS
- Solid commercial performance to support
revenues in the second half:
- Positive outcome of Video contract
renewals, notably with Cyfrowy Polsat at the HOTBIRD position
- Capacity contract at the 5° West
orbital position with SFR-Altice for the distribution of c. 20 HD
channels
- Favourable outcome of US Government
Autumn renewals with a rate of almost 95% in value (versus 85% in
Spring 2017 and 90% in Autumn 2016).
- Incremental business secured in
Government services at 174° East
- Entry into service and ramp-up of
EUTELSAT 172B with incremental capacity contracted for in-flight
Mobility;
- MoU with China Unicom to address
satellite communications market in the framework of the “Belt and
Road” initiative. In this context, China Unicom contracted the
totality of the remaining HTS capacity on the EUTELSAT 172B
satellite (60% sold to Panasonic);
- Smooth integration of Noorsat, acquired
in October 2017 to optimise Video distribution in the MENA
region;
- Improved profitability:
- LEAP cost-savings program ahead of
plan, helping 0.5 point rise in EBITDA margin at constant
currency
- Strong Discretionary Free Cash Flow
generation, up 8% at constant currency
- Effective capex containment in the
first half
- Capex for current fiscal year now
expected below the 3-year average objective
ANALYSIS OF REVENUES 4
In € millions
6 months to Dec 2016
6 months to Dec 2017
Change vs. reported revenues
Like-for-like change5
Video Applications 455.4
449.2 -1.4%
-1.2% Fixed Data 84.9
73.4
-13.5% -10.6% Government Services 86.1
80.7 -6.3% -0.1% Fixed Broadband 48.6
44.1 -9.3% -8.1% Mobile Connectivity
38.5
37.1 -3.6% +20.6%
Other revenues6
41.6
12.2 -70.7% -70.2%
Total 755.1
696.6 -7.7%
-5.7% EUR/USD exchange rate 1.11
1.17
Group first half revenues stood at €696.6 million, down
5.7% at constant currency and perimeter. On a reported basis, they
were down 7.7% reflecting a negative currency effect of 1.7 points
and a negative perimeter effect of -0.3 points (disposal of
Wins/DHI and DSAT Cinema, acquisition of Noorsat7). Excluding other
revenues, revenues were down 1.8% at constant currency and
perimeter.
Second quarter revenues stood at €347.4 million, down
4.8% like-for-like and by 6.2% on a reported basis.
Core businesses
Video Applications (66% of revenues)
Video Applications revenues in the first half were
down 1.2% like-for-like to €449.2 million. Broadcast
revenues were up 0.3% excluding the carry-forward impact of the
termination of the TV d’Orange contract last year, with growth
coming predominantly from MENA. Professional Video revenues
continued to experience a mid-single digit decline.
4 i) Unless otherwise stated, all growth rates are
like-for-like, i.e are at constant currency and perimeter ii) the
share of each application as a percentage of total revenues is
calculated excluding “other revenues”.5 At constant currency and
perimeter. The variation is calculated as follows: i) H1 2017-18
USD revenues are converted at H1 2016-17 rates; ii) H1 2016-17
revenues are restated from Wins/DHI and DSAT. H1 2017-18 revenues
are restated from the net contribution of Noorsat.6 Other revenues
include compensation paid on the settlement of business-related
litigations, financing of certain research programmes by the EU and
other organisations, the impact of EUR/USD currency hedging, the
provision of various services or consulting/engineering fees and
termination fees.7 Wins/DHI (Mobile Connectivity) deconsolidated
from end-August 2016 and DSAT Cinema (Video) from end-October 2016
and Noorsat (predominantly Video) consolidated from October
2017.
Second quarter revenues stood at €225.9 million, flat on
a quarter on quarter basis and down 1.6% year-on-year.
At 31 December 2017, the total number of channels broadcast by
Eutelsat satellites stood at 6,810 up 7.4% year-on-year. HD
penetration continued to increase, standing at 1,275 channels
versus 997 a year earlier (+28%), implying a penetration rate of
18.7% compared to 15.7% a year earlier.
On the commercial front a major contract was renewed with
Cyfrowy Polsat at the HOTBIRD position as well as with the
distributor, Globecast. A capacity contract was signed at the 5°
West orbital position with SFR-Altice for the distribution of some
20 channels. Multi-year agreements were signed for new DTH
platforms in several emerging broadcast markets, including Fiji on
EUTELSAT 172B and the Caribbean region on EUTELSAT 117 WEST B.
Elsewhere, the Group took steps to streamline Video distribution
in MENA with the absorption of Noorsat, its largest reseller in the
region. The integration of Noorsat is progressing smoothly.
Fixed Data (11% of revenues)
In the first half, Fixed Data revenues stood at €73.4
million, down 10.6% like-for-like. Second quarter revenues
stood at €36.3 million, down 9.4% on a year-on-year basis, and by
2.9% quarter-on-quarter.
The performance of this vertical continues to reflect ongoing
pricing pressure in all geographies.
Government Services (12% of revenues)
In the first half, Government Services revenues
stood at €80.7 million, stable like-for-like, reflecting solid
levels of renewals with the US Department of Defence in the last 12
months.
Second quarter revenues stood at €39.6 million, down 1.2%
on a year-on-year basis, but up by 0.4% quarter-on-quarter.
Following the entry into service of EUTELSAT 172B, EUTELSAT 172A
was relocated to the 174° East position enabling it to secure
incremental business in coverage of Asia-Pacific and to pursue
other potential opportunities. Elsewhere, Eutelsat signed a
multi-transponder agreement with the Colombian Ministry of Defence
for capacity on the EUTELSAT 115 West B satellite.
Connectivity
Fixed Broadband (6% of revenues)
In the first half, Fixed Broadband revenues stood
at €44.1 million, down 8.1% like-for-like, partly reflecting the
absence of a positive one-off booked in the first quarter last year
related to the phasing of payments by a specific customer as well
as a slight underlying decline in European consumer Broadband.
Second quarter revenues stood at €21.8 million, down 6.5
% year-on-year and down by 1.7% quarter-on-quarter.
Revenue trends are expected to improve in the second half now
that the retail joint-venture with ViaSat is up and running. The
first offers have been launched in Norway and Poland in December,
and in Sweden and Finland in January.
Mobile Connectivity (5% of revenues)
In the first half, Mobile Connectivity revenues
stood at €37.1 million, up 20.6% like-for-like, reflecting the
effect of the Taqnia contract signed last year as well as continued
growth on wide-beam capacity notably over the Americas and at 172°
East.
Second quarter revenues stood at €18.5 million, up 10.1%
on a year-on-year basis, and 0.8% quarter-on-quarter.
EUTELSAT 172B started to operate end-November with the HTS
payload now fully sold to Panasonic and China Unicom as well as
incremental wide-beam capacity sold for in-flight Mobility.
Other Revenues
Other revenues amounted to €12.2 million in the first
half, of which €5.4 million in the second quarter.
This compares with the exceptionally high level of €41.6 million
in H1 2016-17 which included fees in respect of technical and
engineering services, termination fees related to the
rationalisation of the distribution at HOTBIRD as well as revenues
related to the agreements with SES at 28.5° East which ended on 31
December 2016.
OPERATIONAL AND LEASED TRANSPONDERS
The number of operational transponders at 31 December 2017 rose
by 90 to 1,416 year-on-year, mainly due to the entry into service
of EUTELSAT 117 West B and EUTELSAT 172B.
The fill rate stood at 67.0% compared to 70.9% a year earlier,
reflecting mainly the impact of this new capacity. An incremental
18 transponders have been leased since end-June ‘17 reflecting
notably new business in Government Services at 174° East and in
Mobile Connectivity.
31
Dec 2016 30 Jun 2017
31 Dec 2017
Operational transponders8
1,326 1,372
1,416
Leased transponders9
940 931
949 Fill rate 70.9% 67.9%
67.0%
Note: Based on 36 MHz-equivalent transponders excluding high
throughput capacity (KA-SAT satellite, Ka-band HTS payloads on
EUTELSAT 3B, EUTELSAT 65 West A, EUTELSAT 36C and leased on Al-Yah
2, Ku-band HTS payload on EUTELSAT 172B).
ORDER BACKLOG
The order backlog10 stood at €4.7 billion at 31 December 2017
versus 5.2 billion at end June, mainly reflecting the impact of the
integration of Noorsat (-€0.4 billion).11
The backlog was equivalent to 3.2 times 2016-17 revenues. Video
Applications represented 85% of the backlog.
31
Dec 2016 30 Jun 2017
31 Dec 2017 Value of
contracts (in billions of euros) 5.3 5.2
4.7 In years of annual revenues based on previous fiscal
year 3.5 3.5
3.2 Share of Video Applications 84%
85%
85%
PROFITABILITY
EBITDA amounted to €545 million at 31 December 2017
compared with €588 million a year earlier, down 7.4%. The EBITDA
margin stood at 78.2% (78.4% at constant currency), an improvement
compared to last year (77.9%) thanks to the impact of the “LEAP”
cost saving plan and in spite of the much lower level of ‘Other
revenues’ which no associated costs.
As usual the H1 margin is not representative of the full-year
due the favourable phasing of certain operating costs.
Group share of net income stood at €157 million versus
€192 million a year earlier, a 18.6% decrease, and represented a
margin of 22.5%. This reflected:
- Lower depreciation and
amortisation, down €20 million year-on-year, principally due to
lower depreciation of satellites ending their operational life in
the past 18 months (EUTELSAT 70D and EUTELSAT 48A) or already fully
depreciated;
- ‘Other operating income’ of -€10
million reflecting mainly the one-off accounting impact of the
integration of Noorsat compared with +€23 million a year ago, an
amount which included the capital gain on Wins/DHI;
- A net financial result of -€56
million (versus -€60 million a year earlier), reflecting a
lower cost of debt (-€48 million versus -€66 million a year
earlier) thanks mainly to the reimbursement of a €850 million bond
in March 2017 and the evolution of Other financial income (-€8
million versus +€6 million a year earlier) reflecting predominantly
the negative variation in foreign exchange gains and losses.
- A tax rate of 27.0% (versus
28.2% last year) which included notably the recognition of a
positive non-cash one-off related to deferred tax liabilities to
take into account the future evolution of the French corporate tax
rate as well as the full impact of the refund regarding the 3%
dividend tax for previous years. As a reminder last year’s tax rate
also reflected the partial tax-exemption of the capital gain in
respect of the disposal of Wins/DHI.
8 Number of transponders on satellites in stable orbit, back-up
capacity excluded.9 Number of transponders leased on satellites in
stable orbit.10 The backlog represents future revenues from
capacity lease agreements and can include contracts for satellites
under procurement.11 Long-term capacity contracts with Noorsat
replaced by shorter-term contracts with end-customers
CASH FLOW
Net cash flow from operating activities amounted to €412
million versus €482 million in H1 2016-17. This reflected mainly
the lower EBITDA, and to a lesser extent slightly more unfavourable
impact from working capital requirement and higher tax paid,
reflecting the timing of tax payments.
Cash Capex amounted to €53 million, down from €130
million a year earlier, reflecting the phasing of various satellite
programmes. This amount is not representative of the anticipated
full year level.
Interest and other fees paid net of interest received
amounted to €21 million compared to €27 million last year,
reflecting lower interest related to financial leases.
As a result, Discretionary Cash-Flow amounted to €339
million, up 4.3% on a reported basis and by 8.1% at constant
currency.
FINANCIAL STRUCTURE
At 31 December 2017, net debt was broadly unchanged at
€3,630 million, versus €3,641 million at 30 June 2017.
Discretionary free cash-flow largely covered the dividend payment
(€295 million including dividends paid to minority interests).
Equity investments (acquisition of Noorsat and of minority
interests in Broadband for Africa) generated a cash outflow of €89
million, while the foreign exchange portion of the cross-currency
swap - which is included in Net Debt - decreased by €32 million.
Other items mainly related to repayments of export credit
financings and financial leases contributed to the reduction of net
debt for an amount of €24 million.
The net debt to EBITDA ratio stood at 3.3 times, a slight
improvement on end-December 2016 (3.4 times).
The weighted average maturity of the Group’s debt stood at 2.5
years, compared to 2.9 years at end-December 2016. The average cost
of debt after hedging was 2.9% (3.1% in H1 2016-17).
Liquidity remained strong, with undrawn credit lines of
€650 million and cash of €360 million.
DIVIDEND
The Annual General Meeting of Shareholders held on 8 November
2017 approved the payment of a dividend of €1.21 per share in
respect of the financial year ended 30 June 2017, up from €1.10 the
previous year.
The dividend, totaling €281 million, was fully paid in cash on
23 November 2017.
FINANCIAL OUTLOOK
Based on the performance of the First Half, the group confirms
the financial objectives communicated on 28 October 2017.
- Revenues (at constant currency
and perimeter) for FY 2017-18 are expected at between -1 and -2%12.
They are expected to return to slight growth from FY 2018-19
onwards;The absorption of Noorsat (consolidated from October 2017)
will add some USD15 million on a full-year basis.
- The EBITDA margin (at constant
currency) is expected above 76% for FY 2017-18. From FY 2018-19
onwards it is expected at above 77%;
- Cash Capex will be maintained at
an average of €420 million13 per annum for the period July 2017 to
June 2020. For the current year it is expected below this
level;
- Discretionary Free Cash Flow14
is expected to deliver mid-single digit CAGR in the period July
201715 to June 2020 (at constant currency);
- The Group is committed to maintaining a
sound financial structure to support its investment grade credit
rating and aims at a net debt / EBITDA ratio below
3.0x;
- It also retains its commitment to
serving a stable to progressive dividend.
12 For fiscal year 2016-17, revenues on the basis of perimeter
as of 30 June 2017 stood at €1,472 million (excluding revenues from
Wins/DHI and DSAT Cinema which were sold during fiscal year
2016-17).13 Including capital expenditure and payments under
existing export credit facilities and long-term lease agreements on
third party capacity.14 Net cash-flow from operating activities –
Cash Capex - Interest and Other fees paid net of interest
received15 Discretionary Free-Cash-Flow of €407.8 million in FY
2016-17.
This outlook is based on the nominal deployment plan
hereunder.
FLEET DEPLOYMENT
Nominal deployment programme
Satellite1
Orbital
position
Estimated launch(calendar year)
Main
applications
Main geographic coverage Physical
transponders
36 MHz-equivalent transponders / Spotbeams
Of which expansion
36 MHz-equivalent transponders
EUTELSAT 7C 7° East H2 2018 Video
Turkey, Middle-East, Africa 44 Ku 49 Ku 19 Ku
EUTELSAT 5 WEST B 5° West H2 2018 Video
Europe, MENA 35 Ku 35 Ku None EUTELSAT QUANTUM
To be
confirmed
2019 Government Services Flexible 8
beams“QUANTUM” Not applicable Not applicable African
Broadband satellite To be
confirmed
2019 Broadband Africa 65 spotbeams
75 Gbps 75 Gbps
1 Chemical propulsion satellites (EUTELSAT
QUANTUM, EUTELSAT 5 West B) generally enter into service 1 to 2
months after launch. Electric propulsion satellites (EUTELSAT 7C
and the African Broadband satellite) between 4 and 6 months.
Al Yah 3 satellite, on which Eutelsat is leasing capacity for
its Konnect Africa project, was launched on 25 January 2018. The
mission experienced some challenges during the launch stages which
resulted in the Al Yah 3 satellite being inserted into an orbit
that differed from the flight plan. Thereafter, the satellite was
successfully acquired by Yahsat and the satellite is healthy and
operating nominally. A revised flight plan will be executed in
order to achieve the operational orbit and fulfil the original
mission.
Changes in the fleet
- EUTELSAT 172B which was launched in
June 2017 started to operate end-November. Subsequently, EUTELSAT
172A was relocated at 174° East and renamed EUTELSAT 174A.
- EUTELSAT 31A reached the end of its
operational life and was de-orbited in January 2018.
- EUTELSAT 16C reached the end of its
operational life and was de-orbited in February 2018.
CORPORATE GOVERNANCE
The Ordinary and Extraordinary Shareholders’ Meeting of Eutelsat
Communications of 8 November 2017 approved the appointment of four
new directors: Dominique D'Hinnin, Paul-François Fournier, Esther
Gaide and Didier Leroy.
Dominique D'Hinnin was subsequently appointed as chairman
succeeding Michel de Rosen.
The Board is now made up of twelve members, 42% of whom are
women (five out of twelve) and 67% of whom are independent
directors (eight out of twelve).
The Combined General Meeting also approved all the other
resolutions, including the approval of the accounts, the dividend
for the 2016-17 Financial Year, (€1.21 per share, paid on 23
November 2017), executive compensation and financial
resolutions.
BUSINESS PORTFOLIO
On 14 July 2017, Eutelsat repurchased the minority interests
held by Inframed in Broadband for Africa.
On 12 October, Eutelsat acquired Noorsat, one of the leading
satellite service providers in the Middle East, from Bahrain’s
Orbit Holding Group.
*******
First Half 2017-18 results conference call and
webcast
A conference call will be held on Friday, 16 February
2018 at 9:00am CET
To connect to the call, please use the following numbers:
- + 33 (0) 1 76 77 22 74 (France)
- + 44 (0) 330 336 9105 (UK)
- + 1 323 994 2083 (USA)
Access code: 3857717#
The presentation will also be available via webcast on our
website at http://www.eutelsat.com/en/investors.html
Recording available from 16 February 1:00pm to 23 February,
1.00pm CET
- + 33 (0) 1 70 48 00 94 (France)
- + 44 (0) 207 660 0134 (UK)
- + 1 719 457 0820 (USA)
Access code: 3857717#
Documentation
Consolidated accounts are available at
www.eutelsat.com/investors/index.html
Financial calendar
The financial calendar below is provided for information
purposes only. It is subject to change and will be regularly
updated.
- 14 May 2018: Third quarter 2017-18
revenues
- 1 August 2018: Full year 2017-18
results
About Eutelsat Communications:
Founded in 1977, Eutelsat Communications
is one of the world's leading satellite operators. With a global
fleet of satellites and associated ground infrastructure, Eutelsat
enables clients across Video, Data, Government, Fixed and Mobile
Broadband markets to communicate effectively to their customers,
irrespective of their location. Over 6,700 television channels
operated by leading media groups are broadcast by Eutelsat to one
billion viewers equipped for DTH reception or connected to
terrestrial networks. Headquartered in Paris, with offices and
teleports around the globe, Eutelsat assembles 1,000 men and women
from 44 countries who are dedicated to delivering the highest
quality of service
Eutelsat Communications is listed on the
Euronext Paris Stock Exchange (ticker: ETL).
For more about Eutelsat go to
www.eutelsat.com
Disclaimer
The forward-looking statements included herein are for
illustrative purposes only and are based on management’s current
views and assumptions. Such forward-looking statements involve
known and unknown risks. For illustrative purposes only, such risks
include but are not limited to: postponement of any ground or
in-orbit investments and launches including but not limited to
delays of future launches of satellites; impact of financial crisis
on customers and suppliers; trends in Fixed Satellite Services
markets; development of Digital Terrestrial Television and High
Definition television; development of satellite broadband services;
Eutelsat Communications’ ability to develop and market value-added
services and meet market demand; the effects of competing
technologies developed and expected intense competition generally
in its main markets; profitability of its expansion strategy;
partial or total loss of a satellite at launch or in-orbit; supply
conditions of satellites and launch systems; satellite or
third-party launch failures affecting launch schedules of future
satellites; litigation; ability to establish and maintain strategic
relationships in its major businesses; and the effect of future
acquisitions and investments.
Eutelsat Communications expressly disclaims any obligation or
undertaking to update or revise any projections, forecasts or
estimates contained in this presentation to reflect any change in
events, conditions, assumptions or circumstances on which any such
statements are based, unless so required by applicable law.
APPENDICES
Appendix 1: Additional financial
data
Extract from the consolidated income statement (in €
millions)
Six months ended
December 31 2016
2017 Change (%)
Revenues 755.1
696.6 -7.7%
Operating expenses (167.1)
(152.0)
-9.0% EBITDA 588.0
544.6
-7.4% Depreciation and amortisation (274.3)
(254.2)
-7.3% Other operating income (expenses) 23.3
(10.4) na Operating income 336.9
280.0 -16.9% Financial result (59.6)
(55.8) -6.4% Income tax expense (78.2)
(60.6)
-22.5% Income from associates -
(1.0) na
Portion of net income attributable to non-controlling interests
(7.0)
(6.2) -11.4% Group share
of net income 192.2
156.5 -18.6%
Net debt to EBITDA ratio
31 Dec. 2016
31 Dec. 2017 Net debt at
the beginning of the period €m 4,007
3,641 Net debt at the end of the period €m
3,885
3,630 Net debt / EBITDA (Last twelve
months) X 3.4
3.3
Change in net debt (€ millions)
Half-year ending
31/12/2016 31/12/2017 Net cash flows from
operating activities 481.6 412.1
Cash Capex (130.2) (52.8) Interest and Other fees
paid net of interests received (26.6) (20.5)
Discretionary Free Cash Flow 324.8
338.8 (Acquisition) / disposal of equity investments and
subsidiaries 54.0 (89.0) Distributions to shareholders (including
non-controlling interests) (266.3) (295.5) Change in foreign
exchange portion of the cross-currency swap (28.7)
32.4 Other 37.9 23.7
Decrease (increase) in net
debt 121.7 10.4
Appendix 2: quarterly revenues by
application
Reported revenues
The table below shows quarterly reported revenues. Q1 2016-17
revenues are restated under the new classifications used since H1
2016-17 results.
In € millions
Q1 2016-17
Q2 2016-17 Q3 2016-17 Q4
2016-17 Q1 2017-18 Q2 2017-18 Video
226.5 228.9 228.1 224.3 223.3
225.9 Fixed Data 43.4 41.4 42.1
41.1 37.1 36.3 Government Services 42.3
43.8 45.2 44.8 41.1 39.6 Fixed
Broadband 24.9 23.7 24.2 23.4
22.3 21.8 Mobile Connectivity 20.6 17.9
17.2 18.9 18.6 18.5 Other revenues 27.1
14.5 7.5 6.0 6.8 5,4
Total 384.8 370.2
364.3 358.5 349.1
347.4
Proforma revenues
The table below shows quarterly proforma revenues for FY 2016-17
excluding revenues from Wins / DHI and DSAT Cinema:
In € millions
Q1 2016-17 Q2
2016-17 Q3 2016-17 Q4 2016-17
FY 2016-17 Video 226.5 228.7
228.1 224.3 907.7 Fixed Data 43.4 41.4
42.1 41.1 168.1 Government Services
42.3 43.8 45.2 44.8 176.1 Fixed
Broadband 24.9 23.7 24.2 23.4
96.2 Mobile Connectivity 14.5 17.9 17.2
18.9 68.5 Other revenues 27.1 14.5 7.5
6.0 55.0
Total 378.7
370.0 364.3 358.5
1,471.6
Appendix 3: Alternative performance
indicators
In addition to the data published in its accounts, the Group
communicates on three alternative performance indicators which it
deems relevant for measuring its financial performance: EBITDA,
cash capex and Discretionary free cash flow (DFCF). These
indicators are the object of reconciliation with the consolidated
accounts.
EBITDA, EBITDA margin and Net debt / EBITDA ratio
EBITDA reflects the profitability of the Group before
Interest, Tax, Depreciation and Amortization. It is a key indicator
in the Fixed Satellite Services Sector. The table below shows the
calculation of EBITDA based on the consolidated P&L accounts
for H1 2016-17 and H1 2017-18:
Six months ended December 31
(€ millions) 2016 2017 Operating
result 336.9 280.0 +Depreciation and Amortization
274.3 254.2 - Other operating income and expenses (23.3)
10.4
EBITDA 588.0 544.6
The EBITDA margin is the ratio of EBITDA to revenues. It is
computed as follows:
Six months ended December 31
(€ millions) 2016 2017 EBITDA
588.0 544.6 Revenues 755.1 696.6
EBITDA margin (as a % of revenues) 77.9
78.2
At constant currency, the EBITDA margin stood at 78.4% as of 31
December 2017.
The Net debt / EBITDA ratio is the ratio of net debt to
last-twelve months EBITDA. It is computed as follows:
Six months ended December 31
(€ millions) 2016 2017 Last twelve
months EBITDA 1,152.3 1,090.2
Closing net debt16
3,885.0 3,630.3
Net debt / EBITDA
3.4x 3.3
Cash Capex
The Group on occasion operates capacity within the framework of
financial leases, or finances all or part of certain satellite
programs under export credit agreements, leading to outflows which
are not reflected in the item “acquisition of satellites and other
tangible or intangible assets”. Cash Capex including these two
elements is published in order to reflect the totality of Capital
Expenditures undertaken in any financial year.
Cash Capex therefore covers the acquisition of satellites and
other tangible or intangible assets as well as payments in
respect of export credit facilities and long term financial leases
on third party capacity.
Cash Capex for H1 2016-17 was restated from the value of the
payment owed in 2015-16 to RSCC in respect of lease of EUTELSAT 36C
but paid effectively in H1 2016-1717 (€87.2m) which was already
accounted for in 2015-16 cash capex.
16 Net debt includes all bank debt, bonds and all liabilities
from long-term lease agreements and Export Credit Agencies as well
as Forex portion of the cross-currency swap, less cash and cash
equivalents (net of bank overdraft). Net Debt calculation is
available in the Note 14 of the appendices to the financial
accounts.
The table below shows the calculation of Cash Capex for H1
2016-17 and 2017-18:
Six months ended December 31
(€ millions) 2016 2017 Acquisitions
of satellites, other property and equipment and intangible assets
100.7 26.7
Repayments of ECA loans and long-term
capital leases18
116.7 26.2 Payment owed to RSCC in respect of lease of EUTELSAT 36C
blocked in H1 2015-16 due to Yukos legal proceeding (87.2)
-
Cash Capex per financial outlook definition
130.2 52.8
Discretionary free cash flow (DFCF)
The Group communicates on Discretionary free cash flow which
reflects its ability to generate cash after the payment of interest
and taxes. DFCF generally and principally serves the dividend
payment and debt reduction.
Discretionary free cash flow is defined as Net cash flow from
operating activities less Cash Capex as well as interest and other
financial costs, net of interest income.
The table below shows the calculation of Discretionary free cash
flow for H1 2016-17 and 2017-18 and its reconciliation with the
cash flow statement:
Six months ended December 31
(€ millions) 2016 2017 Net cash
flows from operating activities 481.6 412.1
Acquisitions of satellites, other property and equipment and
intangible assets (100.7) (26.7)
Repayment of Export credit
facilities19
(15.5) (11.9)
Repayment in respect of long-term
leases20
(101.2) (14.3) Interest and other fees paid net of interest
received (26.6) (20.5) Payment to RSCC in respect of lease of
EUTELSAT 36C included in 2015-16 Discretionary Free-Cash Flow
87.2 -
Discretionary Free-Cash Flow
324.8 338.8
At constant currency, the Discretionary Free-Cash Flow would
have amounted to €351.4m as of 31 December 2017.
17 In FY 2015-16 the payment was frozen in the context of the
legal action brought against the Russian State by former Yukos
shareholders.18 Included in lines “Repayment of borrowings” and of
“Repayment of finance lease liabilities” of cash-flow statement19
Included in the line “Repayment of borrowings” of cash-flow
statement20 Included in the line “ Repayment in respect of finance
lease liabilities” of cash-flow statement
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version on businesswire.com: http://www.businesswire.com/news/home/20180215006269/en/
Eutelsat CommunicationsPress
RelationsMarie-Sophie Ecuer, + 33 1 53 98 37
91mecuer@eutelsat.comorInvestor
RelationsJoanna Darlington, + 33 1 53 98 31
07jdarlington@eutelsat.comorCédric Pugni, + 33 1 53 98 31
54cpugni@eutelsat.com
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