(AOF) – AVS, a leading Brazilian player in the provision and integration of services for the public and private sectors, has just signed several contracts with Eutelsat Communications for capacity on board the Eutelsat 65 West A satellite. to this partnership, AVS is able to distribute public channels such as TV ALEPR, TV ALESC, TV ALEPE and TV ALBA on the Eutelsat 65 West A satellite, without suffering the interference generated by the activation of 5G which is in progress deployment on Brazilian territory.
Indeed, Brazil has undertaken to deploy 5G in the 3.5 GHz band, which currently hosts satellite television services in the C band.
Eutelsat 65 West A’s planned C-band is a specific frequency band covering a range between 4.5 GHz and 4.8 GHz, and operating at 800 MHz above 5G operating frequencies in Brazil.
Therefore, Eutelsat 65 West A allows broadcasters to expand their geographical coverage under economically advantageous conditions, since it is not necessary to install filters to avoid interference with 5G.
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Key points
– Second world operator of telecom satellites created in 1977, with a market share of 16%;
– Turnover of €1.51 billion generated by 36 satellites in operation, split between video for 61%, professional data and video for 14%, government services for 12%, mobile connectivity for 7% and fixed broadband for 6%;
– International diversity between Europe (26%), North Africa-Middle East (22%), Americas (10%), Sub-Saharan Africa (10%), Central Europe (9 %);
– Business model based on the generation of free cash flow via contracts of 10 to 15 years – the lifespan of a satellite – and a return to growth via video and connectivity;
– Capital held 19.8% by BPIFrance, 7.5% by the Strategic Investment Fund and 6.7% by China Investment Capital, Dominique d’Hinnin chairing the 11-member board of directors and Eva Berneke new director general;
– Financial position under control with net debt of €2.8 billion (debt leverage of 3.27) with €1.9 billion in cash.
Challenges
– Strategy between now and 2025: acceleration of growth in video (scaling up of Broadband with ViaSat, and High Definition) and in connectivity: launch of the managed services solution Eutelsat Advance / Comète project back to the growth / entry into service of substantial capacities from the 2023-24 financial year with significant firm commitments secured;
– Innovation strategy integrated into the business model;
– Structured environmental strategy between the management of the space fleet within the framework of the Net Zero Space initiative – avoiding congestion, managing space debris and reducing the end-of-life impact of satellites – and the optimization of the impact ground operations;
– Release, for the benefit of the American FCC, of the C-band spectrum by the beginning of 2022, for a total amount of 507 MS;
– Execution of the IoT strategy with ELO and IoT First, turnkey service operating on the geostationary fleet;
– Visibility of the activity with an order book of €4 billion: 4 entry into service of satellites in 2023 (Eutelsat 10B, Eutelsat Hotbird 13G and 13F, Konnect VHTS) and 1 in 2024 (Eutelsat 36 D).
Challenges
– Exposure to connected TV projects from Google/Qualcomm and competition from Tesla, SES, etc.;
– Impact of the Russian-Ukrainian conflict (6.3% of revenues due to Russian customers, rental of the capacity of 4 satellites from the Russian RSCC, for a net value of €322 million): 6 launches planned for Oneweb from Baikonur distributed to SpaceX and New Space India and suspension of broadcasts;
– Towards a merger by exchange of shares with the British OneWeb, already 22.9% owned and valued at 3.4 billion: payment by issuing 50% of new Eutelsat shares, at a unit price of €12 / complementarity of offers ( geostationary or low-orbit satellites) in connectivity / value creation potential estimated at €1.5 billion / forecasts for 2022-2023: €1.2 billion in revenue and operating profit of €700 million;
– 2022-2023 objectives (excluding OneWeb), revenue of €1.15 to €1.18 billion, free cash flow of €420 million and cost savings of €20 to €25 million, with the return to revenue growth being reiterated for 2023-24, with the entry into service of Konnect VHTS and Eutelsat 10B, with investments maintained at €400 million until 2024.
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