(BFM Bourse) – The French satellite operator is adjusting its revenue target for the 2021-2022 financial year downwards after a first half marked by “delayed availability of incremental capacities”, in particular transponders (or amplifiers). Eutelsat also does not expect a return to growth before 2023-2024. The title falls heavily.
The downward revision of the outlook for the current financial year and the next weighs on Eutelsat’s share price on Thursday morning. The title indeed drops 5.3% to 10.77 euros around 11:40 a.m., among the most pronounced declines in stocks eligible for the SRD.
In question, a first half (ended December 31) thwarted by the delayed availability of certain assets, postponing the entry into service of several satellites and forcing the French operator – in competition with the Luxembourgers SES and Intelsat – to adjust to the lower his ambitions.
Between July and December, revenue from the group’s operating activities fell by 4.2% on a like-for-like basis, to 563.5 million euros. Ebitda for its part fell by 10% to 435.7 million euros, reflecting an Ebidta margin of 76.1% (compared to 77.0% a year earlier). Adjusted free cash flow came to 203.4 million, down 23.5% compared to the first half of 2020-2021. “The first half performance was satisfactory from a financial standpoint, with strong cash flow generation and profitability which remains among the highest in our sector despite the drop in turnover, testifying to our business model. strength and our rigorous financial discipline,” comments Group Chief Executive Eva Berneke, who took up her post on 1 January.
Return to growth from 2023
“Although we have mechanically adjusted downward our medium-term revenue expectations given the delayed availability of incremental capacity, I am confident that we have the elements in place to return to growth from the 2023-24 financial year and continue to create long-term value for our shareholders” she tries to reassure.
Because Eutelsat Communications now expects its turnover for the current financial year to fall “in the lower half of the target range of between 1.11 and 1.15 billion euros. “previously announced. A slight downward revision attributed in particular to the geopolitical situation in the Middle East, which “had a negative effect on government services activities”, as well as to the delay in the resale of capacity available at orbital position 7 /8° West, covering the Middle East and North Africa.
The delays in the entry into service of the Konnect VHTS and Eutelsat 10B satellites also have “a mechanical effect on our expectations for the following years” indicates the group, which warns that “the return to growth in turnover on the 2022-2023 financial year is no longer an achievable goal”. This return to growth is therefore now expected for the 2023-2024 financial year, “thanks to the availability of incremental resources”.
Manufacturing delays
Although still expected during the first half of 2023, the entry into service of the Eutelsat 10B satellite (intended to offer connectivity services in aircraft and on ships) is notably delayed due to “manufacturing delays and their effect domino, including the difficulties of pairing satellites, linked to the rescheduling of launches” in the context of the health crisis. As for Konnect VHTS, the “most powerful telecommunications satellite ever made in Europe” according to its manufacturer Thales Alenia Space, entry into service has been postponed from the first to the second half of the calendar year 2023. With a mass of 6 .3 tons (for more than 8 meters high) and with a capacity of 500 gigabits per second, this satellite system dedicated to very high speed will carry on board the most powerful digital processor ever put into orbit.
These entries into service will enable Eutelsat to make available the famous “incremental” or additional capacities. These also concern additional capacity commitments on several satellites in the fleet, including 48 transponders – a device combining a receiver and a transmitter and allowing a signal to be amplified – for Eutelsat 70B.
Finally, the group recalls having successfully launched, on July 30, Eutelsat Quantum, a European telecommunications satellite developed within the framework of a public-private partnership between the European Space Agency, Eutelsat and Airbus Defense and Space, entered in service in November. According to the operator, this provides “unprecedented flexibility to meet the needs of government and mobility markets”, and underlines that “four out of eight beams are at an advanced stage of marketing after a few months of operations”.
Quentin Soubranne – ©2022 BFM Bourse
Are you following this action?
Receive all the information about EUTELSAT COMMUNIC. in real time :