REG-Eutelsat Group Eutelsat Communications: Second Quarter and First Half 2023-24 Results
16/02/2024 07:00
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Eutelsat Communications: Second Quarter and First Half 2023-24 Results
* First Half operating verticals revenues of €571m, confirming return to
topline growth, driven by Eutelsat GEO business and inclusion of OneWeb LEO
business in the Second Quarter
* Continued rise in secured backlog for LEO business despite delays in ground
segment roll-out
* Design of Next Generation LEO constellation securing continuity of customer
service with stepwise capacity and functionality improvements, leading to
reduction in capital expenditure for the period 2025-30
The Board of Directors of Eutelsat Communications (ISIN: FR0010221234 -
Euronext Paris / London Stock Exchange: ETL), chaired by Dominique D’Hinnin,
reviewed the financial results for the Half Year ended 31 December 2023.
Key Financial Data 6M to Dec. 6M to Dec. Change Change Pro Forma(2)
2022
2023(1)
P&L
Revenues - €m 573.8 572.6 -0.2% 1.0%
"Operating Verticals" revenues reported - €m 581.9 571.1 -1.9% 1.2%
Adjusted EBITDA - €m 419.0 365.6 -12.7% -
Adjusted EBITDA - % 73.0% 63.8% -9.2pt -
Operating income - €m 151.2 -134.4 n.a. -
Group share of net income - €m 51.9 -191.3 n.a. -
Financial structure
Net debt - €m 2,996.0 2,619.1 -376.7 M€ -
Net debt/ Adjusted EBITDA - X 3.55 4.13 +0.58 pt -
Backlog - €bn 3.7 3.9 6.1%
Note: This press release contains figures derived from the consolidated
half-year accounts prepared under IAS 34 and subject to a review by the
Auditors (ISRE 2410). They were reviewed by the Audit Committee on 14 February
2024 and approved by the Board of Directors on 15 February 2024. The
auditors’ review procedures have been carried out and the review report is
in the process of being issued. The consolidated half year accounts will be
available on the www.eutelsat.com/investors
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.eutelsat.com%2Finvestors&esheet=53897238&newsitemid=20240215269844&lan=en-US&anchor=www.eutelsat.com%2Finvestors&index=1&md5=401e789183d65909324c6ac2760125b5)
website early next week. Adjusted EBITDA, Adjusted EBITDA margin, net debt /
Adjusted EBITDA ratio and Cash Capex are considered Alternative Performance
Indicators. Their definition and calculation are in Appendix 3 of this
document.
Eva Berneke, Chief Executive Officer of Eutelsat Communications, said: “The
Eutelsat GEO business is performing in line with expectations, confirming the
return to top line growth for Eutelsat historic scope for FY 2023-24, driven
by the availability of EUTELSAT 10B and KONNECT VHTS. The LEO activities of
OneWeb are progressing well, with 100% of the constellation in place and a
secured and growing backlog. Delays in the availability of the ground network
have impacted revenues, with a mix more oriented towards the sale of user
terminals affecting margins, leading us to adjust our expectations for FY
2023-24. We nevertheless remain confident in the prospects of OneWeb, and the
potential of Eutelsat Group’s unique combined GEO-LEO offer and anticipate
an acceleration in revenues in the coming months as the constellation achieves
full global operational coverage of the ground network. We are progressing
well on the design of the next generation of the OneWeb constellation, based
on a stepwise increase in capacity and functionality with a progressive
extension which also fully utilizes the current in-orbit assets. This will
result in a reduction in expected capital expenditure for the period
2025-30.”
KEY EVENTS
* Eutelsat OneWeb combination effective since late September 2023.
* Operational successes including entry into service of KONNECT VHTS and
EUTELSAT 10B as well as completion of space-segment of OneWeb Constellation.
* First Half Operating Vertical revenues of €571.1 million up 1.2% on a
like-for-like basis.
* Second Quarter Operating Vertical revenues up +3.9% on like-for-like basis and
by 5.4% quarter-on-quarter.
* Eutelsat legacy businesses return to growth in FY 2024 thanks notably to
availability of EUTELSAT 10B and KONNECT VHTS incremental capacity.
* OneWeb LEO business behind schedule due to ground segment delays but expected
to accelerate in coming months as gateway installations increase, with 90%
coverage targeted by mid-2024.
* Design of Next Generation OneWeb constellation focused on progressive
extension of current in-orbit assets, leading to reduction in expected capital
expenditure for the period 2025-30.
ANALYSIS OF REVENUES(3)
In € millions 6M to Dec 6M to Dec Change
2022
2023 (1)
Reported Like-for-like(2)
Video 365.9 331.1 -9.5% -8.0%
Government Services 66.9 74.2 11.0% 10.5%
Mobile Connectivity 55.9 71.2 27.2% 35.6%
Fixed Connectivity 93.2 94.6 +1.5% 9.2%
Total Operating Verticals 581.9 571.1 -1.9% 1.2%
Other Revenues -8.1 1.6 n.a. n.a.
Total 573.8 572.6 -0.2% 1.0%
EUR/USD exchange rate 1.01 1.08
Total revenues for the First Half of FY 2023-24 stood at €572.6 million,
down by 0.2% on a reported basis and up by 1.0% like-for-like.
Revenues of the four Operating Verticals (i.e., excluding ‘Other
Revenues’) stood at €571.1 million. They were up 1.2% on a like-for-like
basis, excluding a negative currency impact of €18 million.
Second Quarter revenues stood at €298.7 million up 3.7% like-for-like.
Revenues of the four Operating Verticals stood at €298.6 million, up 3.9%
year-on-year on a like-for-like basis, and up 5.4%(4) quarter-on-quarter.
In € millions Q2 2022-23 Q2 2023-24(1) Change
Reported Like-for-like(2)
Video 182.4 167.6 -8.1% -6.4%
Government Services 32.2 40.7 26.6% 17.4%
Mobile Connectivity 30.0 36.0 20.1% 28.2%
Fixed Connectivity 46.8 54.3 16.1% 17.6%
Total Operating Verticals 291.4 298.6 2.5% 3.9%
Other Revenues -5.0 0.1 n.a. n.a.
Total 286.4 298.7 4.3% 3.7%
EUR/USD exchange rate 1.00 1.07
Note: Unless otherwise stated, all variations indicated below are on an
unaudited like-for-like basis, ie, at constant currency and perimeter. The
variation is calculated as follows: i) H1 2023-24 USD revenues are converted
at H1 2022-23 rates; ii) the contribution of the BigBlu retail broadband
operations from 1st July 2022 to 31 December 2022 is excluded from H1 2022-23
revenues iii) H1 2022-23 and H1 2023-24 revenues are restated include the
contribution of OneWeb as if the operation had been completed from July 1st,
2022; iv) Hedging revenues are excluded.
Video (58% of revenues)
First Half Video revenues were down by 8.0% to €331.1 million, reflecting
the impact of the early non-renewal of a capacity contract with Digitürk from
mid-November 2022 as well as lower revenues in Europe related to volume
reductions with certain resellers. They were also impacted by the effect of
sanctions against some Russian and Iranian channels.
Second Quarter revenues stood at €167.6 million down by 6.4% year-on-year,
and up 1.9% on a sequential basis. This increase was partly due to a one-off
contract of c. €3 million in Latin America related to technical assistance
for a customer.
Professional Video revenues, which account for less than 10% of the Video
vertical, also decreased, reflecting ongoing structural headwinds.
The Second Half basis of comparison will no longer reflect the impact of
sanctions against Russian and Iranian channels nor the Digitürk non-renewal,
and revenues are expected broadly in line with the wider market trend of a
mid-single digit decline.
Government Services (13% of revenues)
First Half Government Services revenues stood at €74.2 million, up by 10.5%
year-on-year, reflecting the slightly better renewal rate of the Fall US DoD
campaign (above 80%) as well as the contribution of the EGNOS GEO-4 contract
on HOTBIRD 13G. Revenues also included a contribution from OneWeb.
Second Quarter revenues stood at €40.7 million, up by 17.4% year-on-year and
by 4.2% quarter-on-quarter.
The Second Half will benefit from the full period contribution from OneWeb’s
LEO-enabled connectivity solutions, as well as the contribution from the
abovementioned EGNOS GEO-4 contract on HOTBIRD 13G (generating €100m in
revenues over 15 years).
Mobile Connectivity (12% of revenues)
First Half Mobile Connectivity revenues stood at €71.2 million, up 35.6%
year-on-year, underpinned by the entry into service of the high-throughput
satellite, EUTELSAT 10B, with significant pre-commitments and the
commercialization of the final beam on EUTELSAT QUANTUM for a maritime
mobility client.
Second Quarter revenues stood at €36.0 million, up 28.2% year-on-year and up
by 0.2% quarter-on-quarter, reflecting the tougher basis of comparison due to
the above-mentioned entry into service of incremental capacity during the
First Quarter.
Over the Full Year, Mobile Connectivity is expected to see double-digit growth
driven by strong demand for both GEO and LEO-based connectivity solutions.
Fixed Connectivity (17% of revenues)
First Half Fixed Connectivity revenues stood at €94.6 million, up 9.2%
year-on-year, mainly reflecting the entry into service of KONNECT VHTS, as
well as a contribution from LEO connectivity.
Second Quarter revenues stood at €54.3 million, up 17.6% year-on-year and by
23.7% on a sequential basis, mainly reflecting contracts that started from
mid-October following the entry into service of KONNECT VHTS.
This positive dynamic is expected to translate into double digit-growth for
the Full Year on the back of KONNECT VHTS as well as the contribution from the
LEO connectivity offer.
Other Revenues
In the First Half, Other Revenues amounted to €1.6 million versus -€8.1
million a year earlier. They included a €2 million negative impact from
hedging operations versus a negative impact of €12 million a year earlier.
BACKLOG
The backlog stood at €3.9 billion on 31 December 2023 versus €3.7 billion
a year earlier. This increase reflects the contribution of OneWeb’s backlog,
now standing at €700(5) million, up 23% over the last quarter, partly offset
by natural erosion of the backlog, especially in the Video segment, in the
absence of major renewals.
The backlog was equivalent to 3.5 times FY 2022-23 revenues, with Video
representing 46% of the total. This reflects the increasing momentum of the
telecom pivot.
31 Dec. 30 June 31 Dec.
2022
2023
2023
Value of contracts (in billions of euros) 3.7 3.4 3.9
In years of annual revenues based on prior fiscal year 3.2 3.0 3.5
Share of Video application 59% 59% 46%
Note: The backlog represents future revenues from capacity or service
agreements and can include contracts for satellites under procurement. Managed
services are not included in the backlog.
PROFITABILITY
Adjusted EBITDA stood at €365.6 million on 31 December 2023 compared with
€419.0 million a year earlier, down by 12.7%. The Adjusted EBITDA margin
stood at 64.1% at constant currency (63.8% reported) versus 73.0% a year
earlier. This Adjusted EBITDA margin is reflective of the progressive
rebalancing of our business towards connectivity applications.
Operating costs were €52.2 million higher than last fiscal year reflecting
the impact of the consolidation of OneWeb. This was partially offset by a
positive perimeter effect from the disposal of the BigBlu retail broadband
operations, as well as lower Bad Debt especially in Video.
Group share of net income stood at -€191.3 million versus +€51.9 million a
year earlier. This reflected:
* Other operating expenses of -€183.9 million, compared to -€34.0 million
last year, mainly due to fair value adjustment of shares owned by Eutelsat
before the combination.
* Higher depreciation of -€316.1 million versus -€233.8 million a year
earlier, reflecting the perimeter effect from OneWeb as well as higher
in-orbit and on-ground depreciation. (Four satellites, HOTBIRD 13F, HOTBIRD
13G, EUTELSAT 10B and KONNECT VHTS entered service between April and October
2023).
* A net financial result of -€60.7 million versus -€56.0 million a year
earlier, reflecting the higher interest rates, partly offset by favourable
evolution of foreign exchange gains and losses.
* Corporate Income Tax: gain of €28.5 million versus tax cost of €0.8
million last year reflective the recognition of positive deferred tax on the
C-band payment as well as a reduction of the French corporate tax rate.
* Losses from associates of -€23.0 million, reflecting the contribution of the
stake in OneWeb in the First Quarter, which in FY 2022-23 was from July 2022
onwards.
CASH CAPEX
Cash Capex amounted to €224 million, versus €194 last year; this increase
reflects the perimeter effect from the consolidation of OneWeb, and is not
representative of the decrease in Capex, for both Eutelsat and OneWeb, due to
the phasing of satellite program delivery and launch last year during the
first semester.
FINANCIAL STRUCTURE
On 31 December 2023, net debt stood at €2,619.1 million, down €146.6
million versus end of June 2023. It reflected: i) receipt of phase II C-Band
proceeds net of tax of €330.4 million; ii) a negative impact from our
financing activities mostly related to structured debt combined with iii) a
decrease in cash flow from operating activities due to the consolidation with
OneWeb.
The net debt to Adjusted EBITDA ratio stood at 4.13 times, compared to 3.55
times at end-December 2022 and 3.35 times at end-June 2023.
The average cost of debt after hedging stood at 3.16% (2.7% in H1 2022-23).
The weighted average maturity of the Group’s debt stood at 3.0 years,
compared to 4.1 years at end-December 2022.
Undrawn credit lines and cash stood at around €1.8 billion.
UPDATE ON ONEWEB INTEGRATION
The combination between Eutelsat and OneWeb has been effective since end
September 2023. Since then, we have been fully focused on the integration of
the two companies, as well as driving the operational and commercial momentum
of OneWeb:
The space segment of the constellation is fully up and running and delivering
proven performance.
OneWeb’s order backlog continues to grow, now standing at €700m(5), up by
23% over one quarter, while we are seeing strong commercial traction with
several deals activated with major customers. We are making progress on the
ground roll-out following recently reported delays and we are on track for 90%
network coverage by mid-2024.
The progress of the integration enables us to confirm the synergies expected
from the operation. In particular, cost synergies(6) are fully on track, and
we have scope to exceed our original plan.
Capex synergies also confirmed. Eutelsat Group is progressing as planned in
its evaluation of the requirements for the Next Generation OneWeb
constellation, with potential solutions focused on service continuity and a
stepwise enhancement of the OneWeb services. This focus is informed by
operational and commercial in-market experience now that the constellation is
in service.
The Next Gen will progressively embark additional capacity and enhanced
performances compared to Gen 1, with the scope to upgrade both constellation
services and performances progressively.
The cost of this approach is lower than previous estimates for the build-out
of the OneWeb Next Generation.
Thus, we are adjusting our mid-term capex estimates: Cash capex for FY 2024
remains expected in a range between €600m and €650m. For the period FY
2025 to FY 2030, cash capex(7) after synergies is now expected in a range of
€600m to €700m on average per annum (versus €725m to €875m per annum
previously).
OUTLOOK AND FINANCIAL OBJECTIVES
The legacy Eutelsat business remains on track with expected performance and
confirms a return to top line growth for FY 2023-24, mainly driven by the
entry into service of satellites EUTELSAT 10B and KONNECT VHTS.
The results of the LEO activities of OneWeb, while progressing well, with 100%
of the satellites in place and a growing backlog at the end of the last
quarter. As reported in our Trading Update of 29(th) January 2024, they are
running behind schedule relative to the original roadmap. This reflects delays
in the availability of the ground network, impacting revenues, especially in
mobility and in certain geographies where market access is still outstanding,
as well as a revenue mix more oriented than expected towards the sale of user
terminals, which impacts margins.
The deployment of the ground network is progressing well, towards a 90%
completion rate in Q2 2024. We continue to see strong momentum in the take-up
of pre-signed commitments with major customers, and we believe we are on track
towards our longer-term targets.
Nevertheless, this dynamic will not suffice to close the gap relative to our
near-term expectations, and in consequence we are adjusting our financial
objectives for FY 2023-24 as follows (at a €/$ rate of 1.00)(8):
* Revenues are now expected in a range of €1.25bn to €1.3bn (versus
€1.32bn to €1.42bn previously).
* Adjusted EBITDA is expected in a range of €650m to €680m (versus €725m
to €825m previously).
* Cash capex for FY 2024 remains expected in a range between €600m and €650m
after synergies; for the period FY 2025 to FY 2030, the integration of the
revised capex budget for OneWeb NextGen means cash capex (7 )is now expected
between €600m to €700m on average per annum (versus €725m to €875m per
annum previously).
* We also continue to target leverage of c.3x in the medium term.
To allow for a more accurate assessment of prospects in the context of the
rapid development of OneWeb’s business, financial objectives for FY 2024-25
will be reviewed and shared at Eutelsat Group’s FY 2023-24 Results on August
2(nd), 2024; previously communicated objectives for FY 2024-25 are meanwhile
suspended.
Management remains confident in the prospects of OneWeb and the potential of
Eutelsat Group’s unique combined GEO-LEO offer. As the constellation
achieves full global operational coverage, we anticipate an acceleration in
revenues and continue to target double-digit CAGR in revenues and Adjusted
EBITDA between FY 2024 and FY 2028.
Note: This outlook is based on the revised deployment plan outlined in the
Half-Year 2023-2024 results presentation. It assumes no further material
deterioration of revenues generated from Russian customers.
UPDATE ON THE GEOSTATIONARY FLEET
Since 1(st) July 2023, the following changes have occurred in the
Geostationary fleet:
* EUTELSAT 10B entered service in July 2023
* EUTELSAT 33F, formerly HOTBIRD 13Bc started operation at 33°E in September
2023 replacing EUTELSAT 33E, which is being relocated to the American arc.
* KONNECT VHTS entered operational service in October 2023.
* HOTBIRD 13F entered service at 13°E in September 2023
* EUTELSAT 12WE was deorbited in July 2023
* EUTELSAT 10A was deorbited in November 2023
* EUTELSAT 113 West A ceased operation in January 2024
Following these operations, the geostationary fleet stands at 35 satellites.
CORPORATE GOVERNANCE AND SOCIAL RESPONSIBILITY
Governance
The Annual General Meeting of Shareholders of Eutelsat Communications was held
on 23 November, in Paris. All the resolutions were approved. They included
notably:
* Approval of the accounts.
* Compensation report and policy of corporate officers.
* Authorization to the Board of Directors to purchase the Company’s shares.
Changes to Eutelsat Group Executive Committee:
David Bertolotti, Secretary General & Company Secretary, will leave
Eutelsat Group at the end of February 2024 to return to French Ministry of
Europe and Foreign Affairs. Following David’s departure, the teams he
currently leads will be joining new departments: Institutional affairs will
join the Strategy and Resources Department (Jean-Hubert Lenotte), CISO,
Security, Legal, Compliance will be regrouped with HR, Transformation, and
Internal Coms to form a new General Secretary Department (Anne Carron).
Joanna Darlington was appointed as Chief Communications and Investor Relations
Officer on 2(nd) January 2024, replacing Vanessa Mahoney.
Corporate Social Responsibility
On 12(th) September 2023, Eutelsat publicly released its Extra-Financial
Performance Statement for the fiscal year 2022, integrated into the Universal
Registration Document. This statement highlights the environmental, social,
and governance issues, providing details on the Group’s CSR policy, its
carbon footprint, and a report on its ESG (Environmental, Social, and
Governance) indicators.
On 19(th) October, the Group announced its environmental roadmap with
ambitious objectives to reduce its carbon impact and combat climate change, in
line with the requirements of the Paris Agreement. By 2030, Eutelsat commits
to a 50% reduction in its greenhouse gas emissions related to energy
consumption (Scopes 1+2) compared to the 2021 reference year. The Group will
submit these objectives to the Science Based Targets initiative (SBTi) this
year to obtain an independent assessment and validation of these goals.
Following the integration of OneWeb into its activities, Eutelsat Group will
expand the scope of its Scope 3 emissions calculation to include the Low Earth
Orbit (LEO) satellite constellation and associated ground infrastructure.
Half year results presentation
Eutelsat Group will present its results on Friday, February 16, 2024, by
conference call and webcast at 9:00 CET.
Click here
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to attend the webcast presentation.
(The webcast link will remain available for replay)
It is not necessary to dial into the conference call, unless you are unable to
join the webcast URL
If needed, please dial one of these numbers:
+33 (0)1 7037 7166 (from France)
+44 (0)33 0551 0200 (from the U.K)
Quote “Eutelsat” to the operator when connecting to the call.
Documentation
The consolidated half year accounts will be available on the
www.eutelsat.com/investors
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website early next week.
Financial calendar
The financial calendar below is provided for information purposes only. It is
subject to change and will be regularly updated.
* 14 May 2024: Third quarter and nine month 2023-24 revenues
* 2 August 2024: Full Year 2023-24 results
About Eutelsat Group
Eutelsat Group is a global leader in satellite communications, delivering
connectivity and broadcast services worldwide. The Group was formed through
the combination of Eutelsat and OneWeb in 2023, becoming the first fully
integrated GEO-LEO satellite operator with a fleet of 35 geostationary (GEO)
satellites and a Low Earth Orbit (LEO) constellation of more than 600
satellites.
The Group addresses the needs of customers in four key verticals of Video,
where it distributes more than 6,500 television channels, and the high-growth
connectivity markets of Mobile Connectivity, Fixed Connectivity, and
Government Services. Eutelsat Group’s unique suite of in-orbit assets and
on-ground infrastructure enables it to deliver integrated solutions to meet
the needs of global customers. The Company is headquartered in Paris and
Eutelsat Group employs more than 1,700 people from more than 50 countries.
The Group is committed to delivering safe, resilient, and environmentally
sustainable connectivity to help bridge the digital divide. The Company is
listed on the Euronext Paris Stock Exchange (ticker: ETL) and the London Stock
Exchange (ticker: ETL).
Find out more at www.eutelsat.com
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Disclaimer
The forward-looking statements included herein are for illustrative purposes
only and are based on management’s views and assumptions as of the date of
this document.
Such forward-looking statements involve known and unknown risks. For
illustrative purposes only, such risks include but are not limited to: risks
related to the health crisis; operational risks related to satellite failures
or impaired satellite performance, or failure to roll out the deployment plan
as planned and within the expected timeframe; risks related to the trend in
the satellite telecommunications market resulting from increased competition
or technological changes affecting the market; risks related to the
international dimension of the Group’s customers and activities; risks
related to the adoption of international rules on frequency coordination and
financial risks related, inter alia, to the financial guarantee granted to the
Intergovernmental Organization's closed pension ’und, and foreign exchange
risk.
Eutelsat Communications expressly disclaims any obligation or undertaking to
update or revise any projections, forecasts or estimates contained in this
document to reflect any change in events, conditions, assumptions or
circumstances on which any such statements are based, unless so required by
applicable law.
The information contained in this document is not based on historical fact and
should not be construed as a guarantee that the facts or data mentioned will
occur. This information is based on data, assumptions and estimates that the
Group considers as reasonable.
APPENDICES
Appendix 1: Additional financial data
Extract from the consolidated income statement (€ millions)
Six months ended December 31 2022 2023(1) Change (%)
Revenues 573.8 572.6 -0.2%
Operating expenses (154.8) (207.0) 33.7%
Adjusted EBITDA 419.0 365.6 -12.7%
Depreciation and amortisation (233.8) (316.1) 35.2%
Other operating income (expenses) (34.0) (183.9) n.a.
Operating income 151.2 (134.4) n.a.
Financial result (56.0) (60.7) -8.4%
Income tax expense (0.8) 28.5 n.a.
Income / (loss) from associates (39.1) (23.0) -41.2%
Portion of net income attributable to non-controlling interests (3.4) (1.8) n.a.
Group share of net income 51.9 (191.3) n.a.
Extract from the consolidate statement of cash flows (€millions)
Six months ended December 31 2022 2023(1)
Net income 55.3 -189.5
Result from associates 39.1 23.0
Tax and interest expenses, other operating items(9) 57.8 111.7
Depreciation, amortisation and provisions 246.8 413.3
Deferred taxes -15.8 -30.2
Changes in accounts receivable 6.3 -9.1
Changes in assets held under customer contracts and other assets 8.1 -36.3
Changes in accounts payable 5.1 -15.1
Changes in liabilities associated with customer contracts and other -37.0 3.5
liabilities
Taxes paid -12.4 15.3
Net cash flows from operating activities 353.3 286.5
Acquisitions of satellites, other property and equipment, and intangible -166.5 -294.7
assets
Acquisitions of equity investments and other movements(10) -29.2 298.0
Net cash flows from investing activities -195.7 3.3
Distributions -80.6 0.0
Repayment of borrowings(11) -300.0 -164.0
Repayment of lease liabilities -27.8 -19.0
Loan set-up fees - -2.4
Interest and other fees paid -77.4 -85.6
Transactions with non-controlling interests(12) -15.5 -26.0
Premiums and termination indemnities on derivatives settled -31.0 -
Proceeds on asset disposals(13) - 330.4
Increase in debt and others - 90.0
Net cash flow from financing activities -532.2 123.4
Impact of exchange rate on cash and cash equivalents 1.7 1.7
Increase/(Decrease) in cash and cash equivalents -373.0 415.0
Cash and cash equivalents, beginning of period 680.5 482.2
Cash and cash equivalents, end of period 307.4 897.2
Appendix 2: Quarterly revenues by application
Quarterly Reported revenues FY 2022-23 and H1 2023-24
The table below shows quarterly reported revenues FY 2022-23 and H1 2023-24.
In € millions Q1 Q2 Q3 Q4 FY Q1 Q2(1)
2022-23 2022-23 2022-23 2022-23 2022-23 2023-24 2023-24
Video 183.5 182.4 169.3 169.5 704.8 163.5 167.6
Government Services 34.7 32.2 31.4 45.1 143.4 33.5 40.7
Mobile Connectivity 25.9 30.0 26.9 27.3 110.1 35.2 36.0
Fixed Connectivity 46.4 46.8 44.0 40.6 177.8 40.2 54.3
Total Operating Verticals 290.5 291.4 271.6 282.6 1,136.1 272.5 298.6
Other Revenues -3.1 -5.0 0.4 3.0 -4.8 1.5 0.1
Total 287.4 286.4 272.0 285.5 1,131.3 274.0 298.7
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: Adjusted EBITDA, Cash Capex and Discretionary free
cash flow (DFCF). These indicators are the object of reconciliation with the
consolidated accounts.
Adjusted EBITDA, Adjusted EBITDA margin and Net debt / Adjusted EBITDA ratio
In compliance with ESMA recommendations, as of 30 June 2023, Eutelsat’s
“EBITDA” will evolve to “Adjusted EBITDA”. This change of terminology
does not affect the calculation of this indicator.
Adjusted EBITDA reflects the profitability of the Group before Interest, Tax,
Depreciation and Amortisation. It is a frequently used indicator in the Fixed
Satellite Services Sector and more generally the Telecom industry. The table
below shows the calculation of Adjusted EBITDA based on the consolidated
P&L accounts for H1 2022-23 and H1 2023-24:
Six months ended December 31 (€ millions) 2022 2023(1)
Operating income 151.2 (134.4)
+ Depreciation and Amortisation 233.8 316.1
- Other operating income and expenses 34.0 183.9
Adjusted EBITDA 419.0 365.6
The Adjusted EBITDA margin is the ratio of Adjusted EBITDA to revenues. It is
calculated as follows:
Six months ended December 31 (€ millions) 2022 2023(1)
Adjusted EBITDA 419.0 365.6
Revenues 573.8 572.6
Adjusted EBITDA margin (as a % of revenues) 73.0 63.8
At constant currency, the adjusted EBITDA margin stood at 64.1% as of 31
December 2023.
The Net debt / adjusted EBITDA ratio is the ratio of net debt to last-twelve
months adjusted EBITDA. It is calculated as follows:
Six months ended December 31 (€ millions) 2022 2023(1)
Last twelve months adjusted EBITDA 844.9 634.2
Closing net debt(14) 2,996.0 2,619.1
Net debt / adjusted EBITDA 3.55x 4.13x
Cash Capex
The Group on occasion operates capacity within the framework of leases, or
finances all or part of certain satellite programs under export credit
agreements or through other bank facilities, leading to outflows which are not
reflected in the item “acquisition of satellites and other tangible or
intangible assets”. Cash Capex including the outflows related to these
elements is published in order to reflect the totality of Capital Expenditures
undertaken in any financial year.
In addition, in the event of a partial or total loss of satellite, as
previously reported cash Capex included investment in assets which are
inoperable or partially inoperable, the amount of insurance proceeds is
deducted from Cash Capex.
Cash Capex therefore covers the acquisition of satellites and other tangible
or intangible assets, payments in respect of export credit facilities or other
bank facilities financing investments as well as payments related to lease
liabilities. If applicable it is net from the amount of insurance proceeds.
The table below shows the calculation of Cash Capex for H1 2022-23 and H1
2023-24:
Six months ended December 31 (€ millions) 2022 2023(1)
Acquisitions of satellites, other property and equipment and intangible assets (166.5) (139.8)
Insurance proceeds - -
Repayments of ECA loans, lease liabilities and other bank facilities (15) (27.8) (84.1)
Cash Capex (194.3) (223.9)
_____________________
(1) Including OneWeb participation from October 1st, 2023
(2) Unaudited change at constant currency and constant perimeter. The
variation is calculated as follows: i) H1 2023-24 USD revenues are converted
at H1 2022-23 rates; ii) the contribution of the BigBlu retail broadband
operations from 1st July 2022 to 30 December 2022 is excluded from H1 2022-23
revenues iii) H1 2022-23 and H1 2023-24 revenues are restated to include the
contribution of OneWeb as if the operation had been completed from July 1st,
2022; iv) Hedging revenues are excluded.
(3) The share of each application as a percentage of total revenues is
calculated excluding “Other Revenues”.
(4) Unaudited change at constant currency and constant perimeter. The
variation is calculated as follows: i) H1 2023-24 USD revenues are converted
at H1 2022-23 rates; ii) the contribution of the BigBlu retail broadband
operations from 1st July 2022 to 30 December 2022 is excluded from H1 2022-23
revenues iii) H1 2022-23 and H1 2023-24 revenues are restated to take into
account the contribution of OneWeb as if the operation had been completed from
July 1st 2022; iv) Hedging revenues are excluded.
(5) Converted into Euros and excluding intercompany agreements.
(6) annual expected run-rate in pre-tax cost synergies of over €80m by Year
5 of the merger.
(7) Based on nominal deployment plan for the GEO fleet and LEO constellation;
excluding uncommitted projects.
(8) Pro-forma figures with 12 months’ OW figures (actual consolidation as of
1st October 2023).
(9) Includes the impact of the fair value adjustment of OneWeb investment for
€78m.
(10) Includes a credit facility drawdown of €155.0m and cash from OneWeb for
€138.2m.
(11) Includes the redemption of the Eutelsat SA and OneWeb Holding Ltd
facilities in July and November 2023 for €65.1m and €93.0m respectively.
(12) Include earn-out payments for €26m.
(13) Include the proceeds from the release of the C band for an after-tax
amount of €330m.
(14) Net debt includes all bank debt, bonds and all liabilities from lease
agreements and structured debt as well as Forex portion of the cross-currency
swap, less cash and cash equivalents (net of bank overdraft). Net Debt
calculation will be available in the Note 6.4.3 of the appendices to the
financial accounts.
(15) Included in lines “Repayment of borrowings” and of “Repayment of
lease liabilities” of cash-flow statement.
Media enquiries
Joanna Darlington
Tel. +33 674 521 531
jdarlington@eutelsat.com (mailto:jdarlington@eutelsat.com)
Anita Baltagi
Tel. +33 643 930 178
abaltagi@eutelsat.com (mailto:abaltagi@eutelsat.com)
Katie Dowd
Tel. +1 202 271 2209
kdowd@oneweb.net (mailto:kdowd@oneweb.net)
Investors
Joanna Darlington
Tel. +33 674 521 531
jdarlington@eutelsat.com (mailto:jdarlington@eutelsat.com)
Hugo Laurens-Berge
Tel. +33 670 80 95 58
hlaurensberge@eutelsat.com (mailto:hlaurensberge@eutelsat.com)
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