SES H1 2021 Results

Solid H1 performance delivering revenue of €875 million and Adjusted EBITDA⁽¹⁾ of €544 million

• Improving trajectory in Video to -3.9% YOY^(2,3) in H1 2021 from -8.0% YOY^(2,3) in FY 2020
• Resilient Networks performance, flat YOY^(2,3), in a COVID impacted environment with strong prospects for future growth
• 5% YOY⁽³⁾ reduction in recurring Operating Expenses supporting higher YOY Adjusted EBITDA margin (of 62%)
• 19% YOY net interest expense reduction contributing to 35% YOY growth in Adjusted Net Profit of €152 million
• Solid cash flow generation and financial discipline supporting leverage ratio⁽⁴⁾ of 3.3 times at 30 June 2021

2021 Revenue and improved EBITDA outlook on track

• Over 90% of 2021 revenue outlook (€1,760-1,820 million⁽⁵⁾) already under contract
• Adjusted EBITDA outlook for full year 2021 improved to €1,080-1,100 million (from €1,060-1,100 million)⁽⁵⁾

Growth investments and C-band proceeds supporting future growth and value creation

• SES-17 and O3b mPOWER (on track to launch in Q4 2021) backlog now $770 million⁽⁶⁾;up $210 million in YTD 2021
• US C-band clearing on track to meet end-2021 and end-2023 milestones, triggering $1 billion and $3 billion payments respectively

€275 million of shareholder returns delivered since the start of 2021

• 2020 dividend (€181 million) paid in April 2021, consistent with commitment to maintain minimum base dividend of €0.40 per A-share
• Completed €94 million share buyback programme reflecting confidence in the long-term fundamentals of the business 

Steve Collar, CEO of SES, commented: “Our strong start to 2021 continued into the second quarter providing confidence to improve the low end of our Adjusted EBITDA outlook on the back of solid execution and laser focus on reducing cost.

The lasting value of our Video business is reflected in the improved trajectory, the important long-term renewals at our core neighbourhoods, increased penetration of HD TV channels, and new paying subscribers for HD+ in Germany. Excitingly, in H2 2021, we will be expanding and enhancing our HD+ portfolio with the extension onto mobile devices and IP-enabled non-satellite homes.

Networks continues to perform well notwithstanding the COVID-impacted environment, notably in Government, reflecting the strong demand for our unique multi-orbit resilient solutions. With O3b mPOWER still over a year away from commercial launch, we have secured over $300 million in backlog from major cruise brands which underscores the compelling combination of high throughput and high flexibility of the constellation.

C-band clearance remains fully on track. The recent issuing of C-band licences by the FCC is a notable milestone towards initiation of the reimbursement process. Meanwhile, we have returned €275 million of cash to shareholders this year underscoring our commitment to delivering sustained and attractive returns for our shareholders.”

¹ Excluding restructuring charge and operating expenses recognised in relation to US C-band repurposing (disclosed separately)
² Underlying revenue, excluding periodic and other revenue (disclosed separately) that are not directly related to or otherwise distort the underlying business trends
³ At constant FX which refers to comparative figures restated at the current period FX to neutralise currency variations
⁴ Ratio of Adjusted Net Debt (which includes 50% of hybrid bonds as debt, per the rating agency methodology) to Adjusted EBITDA
⁵ Financial outlook assumes a €/$ FX rate of €1 = $1.20, nominal satellite health and launch schedule
⁶ Gross backlog $770 million (fully protected: $610 million)