SES announced full year 2015 results

Orbital satellite operator  SES, who’s one of teleports operates in Riga, Latvia reports year 2015 revenue and profit up 5% over prior year. SES’s differentiated strategy focuses on three key elements: Globalisation (building scale to serve rapidly increasing demand for global solutions), Verticalisation (focused development of differentiated capabilities in the four market verticals), Dematuring (shaping the future user experience, entrenching satellite’s key role in the digital ecosystem).

Karim Michel Sabbagh, President and CEO, commented:  “SES’s on-going globalisation contributed to 5.0% growth in reported revenue. Focus on delivering differentiated solutions generated revenue growth in three of the four market verticals now defining SES’s global business.  We also strengthened our Enterprise business. Video  grew  in  developed  and  emerging  markets,  supported  by  SES’s  superior  growth  in  HD  and  being  first  to  add  commercial  Ultra  HD  channels.  SES  expanded  long-term commercial  relationships  across  Enterprise  and  Mobility  with major global customers including  Global Eagle Entertainment  and Airbus Defence and Space,  and  notably signing two major inflight connectivity agreements early in 2016 with Panasonic and Gogo for new HTS  capacity on SES- 14 and SES- 15. SES  is  committed  to  maintaining  a  progressive  dividend,  and  has proposed an increase of  10% for the 2015 dividend.”

By delivering differentiated and global satellite-enabled solutions, SES serve four key market verticals – Video, Enterprise, Mobility and Government.

Video – 67% of group revenue (2014: 66%)

• Reported revenue grew 7.5% to EUR 1,354.9 million
• HDTV channels grew 18.3% to 2,230, strengthening HD penetration from 28.9% to

30.7%

• HDTV market share up from 24.9% to 25.8% (the largest of any satellite operator)
• Over 380 new TV channels (170 in HD) added across fast-growing emerging markets
• First in commercial Ultra HD, with eight channels now broadcast globally over SES satellites

SES’s substantial technical reach in prime video neighborhoods contributed to an 11.3% increase in total TV channels broadcast over SES satellites to 7,268 channels.  This was well ahead of the rest of the satellite industry (up 2.3%) and further reinforced SES’s industry-leading position.  SES is also number one in HDTV  channels, which  grew  by 18.3% to 2,230 channels  as SES captured  growth across  all  regions. In total, nearly 60% of all channels are now broadcast in the MPEG-4 compression standard.

European TV channels grew 9% to nearly 2,600, while HDTV channels increased 26% to 675. During the period,  SES  secured  a  long-term  contract  to  broadcast  BBC  World  News,  the  free-to-air  (FTA)  international  news  channel,  in  HD.  In  August  2015,  Deutsche  Welle  signed  long-term  capacity  agreements  on  three  satellites  (ASTRA  4A, ASTRA 5B and SES-5) to broadcast German and English-language channels in Eastern Europe  and Africa.  In December 2015, Viasat, a DTH  broadcaster and pay TV operator  owned by Swedish media and  entertainment  group  Modern  Times  Group,  extended  its  capacity  contract  to  broadcast  230  channels  in  the  Nordic and Baltic countries via ASTRA 4A and SES-5.  In addition, continued demand for high-quality content  drove an  11% increase in HD+’s paying subscriber base to over 1.8 million.

In Ultra HD (UHD), SES was the first satellite operator to secure commercial agreements to broadcast this next generation video experience. SES now broadcasts eight commercial Ultra HD channels –  pearl.tv (Europe’s first  commercial  UHD channel) and Fashion One 4K (the world’s first global UHD channel), as well as Airtel 4K, Dish  UHD Promo, High 4K TV, INSIGHT, NASA TV UHD and UHD-1  –  and  also signed  (in July 2015)  a commercial agreement to provide Sky Deutschland with additional capacity for Ultra HD broadcasts.

Mobility – 3% of group revenue (2014: 2%)

• Reported revenue grew 47.4% to EUR 52.9 million
• Expanded relationship with Global Eagle Entertainment on current fleet and future HTS capacity
• Major long-term agreements recently signed with Panasonic and Gogo for additional capacity
• SES now serves the three major global aeronautical connectivity providers
• Developing SES’s maritime business with KVH Industries and SkyStream

SES  has  continued  to  scale  up  its  investments  and  capabilities  to  support  major  global  service  providers  in  delivering  a  superior  user  experience  and  meeting  rapidly  growing  passenger  demand  for  connectivity.  In  aeronautical  connectivity,  SES  has  built  on  its  strong  commercial  relationships  with  the  world-leading  service  integrators – Global Eagle  Entertainment, Gogo and Panasonic. Today, the SES fleet serves up to 2,000 aircraft  per year, carrying up to 300,000 airline passengers, with inflight connectivity.

Enterprise – 15% of group revenue (2014: 17%)
Government – 13% of group revenue (2014: 11%)

Forthcoming launches    
SES will launch seven new satellites between 2016 and end-2017. These seven satellites will increase available  capacity  by  180 net  (36  MHz)  transponders,  or  12%  of  current  total  available  capacity,  while  capacity  in  the  International segment will grow by 21%.

Three of these satellites (SES-12, SES-14 and SES-15) will also carry a total of 36 GHz of HTS capacity, which is equivalent to around 250 (36 MHz) transponder equivalents.

Financial guidance 
SES’s  FY  2016  revenue  is  expected  to  be  between  EUR  2,010  million  and  EUR  2,050  million.