SES, the pre-eminent satellite operator worldwide (Paris:SESG)
(LuxX:SESG), reports on financial performance for the year to 31
December 2007.
FINANCIAL HIGHLIGHTS
-- Recurring(1) revenue of EUR 1,597.1 m was up 8.5% on the prior
year period
-- Reported revenue was EUR 1,610.7 m (2006: EUR 1,615.2 m)
-- Recurring(1) EBITDA of EUR 1,125.5 m was 12.2% ahead of the
prior year period
-- Reported EBITDA was EUR 1,090.3 m (2006: EUR 1,080.4 m)
-- Industry-leading infrastructure EBITDA margin of 81.5%
(2006: 78.8%)
-- Net operating cash flow improved to EUR 1,192.7 m (2006 EUR
1,060.1 m)
-- Return on average equity further improved to 17.4% (2006:
13.5%)
-- Average weighted Earnings per share rose 11% to EUR 0.91
(2006: EUR 0.82)
-- Dividend of EUR 0.60 per share proposed (2006: EUR 0.44)
-- EUR 1.4 billion applied to share buyback programme
BUSINESS HIGHLIGHTS
-- GE split-off transaction streamlined our asset portfolio and
removed major share overhang
-- Canal+ agreement secured future development of French DTH
market on ASTRA
-- Strong new business growth in SES NEW SKIES (+20% on a
like-for-like basis)
-- Fleet utilisation of 76.5% (802 of 1,048 commercially
available transponders)
-- Fully protected contract backlog of EUR 5,846.4 million
Romain Bausch, President and CEO of SES, commented:
"As foreseen, SES delivered a very good set of results in 2007,
with the positive financial developments reflecting the favourable
underlying operational performance. The conclusion, in the first
quarter of the year, of the EUR 1.2 billion split-off transaction with
GE streamlined our business and removed a major share overhang, while
the cancellation of the acquired shares delivered immediate
shareholder benefits. Elsewhere, all operations have been delivering
good progress. Our current gearing gives us flexibility to pursue
opportunities to further grow the company, whether through new
satellite investments or select acquisitions. In combination with the
execution of our growth strategy, the proposal of a 36% rise in the
dividend per share to EUR 0.60, and our continuing share buyback
activity, underline our commitment to deliver consistently improving
returns to shareholders, as demonstrated by the increase in return on
average equity to 17.4% from 13.5% in 2006."
BUSINESS REVIEW
SES continued its growth during 2007, with improved financial
performance. After transaction adjustments, recurring revenue, EBITDA,
operating profit and earnings per share all grew strongly. Net
operating cash flow continued to grow allowing SES not only to finance
an increased amount of capital expenditures but also providing
significant amounts of free cash flows, which were used to return cash
to shareholders in the form of dividends and share buy-backs.
SES continued its development path in 2007 with the conclusion of
a significant split-off transaction with major shareholder GE. This
transaction has focused our activities onto 100% owned operations and
enabled an exit from non-core activities, streamlining our operations
and, through the repurchase and cancellation of the GE shares in SES,
has removed a substantial share overhang. Organic growth across the
Group´s entire operational base was led by the strong performances at
SES ASTRA across all its European key markets and at SES NEW SKIES
which delivered particularly good results, demonstrating our ability
to deliver not only cost synergies, but also revenue synergies from
acquisitions.
SES, unlike many companies, has many features which confer
protection against the turmoil in today´s markets. SES has substantial
financial liquidity, a strong balance sheet, and limited direct or
indirect impact from the problems presently being experienced in the
credit markets. Furthermore, we have taken steps to protect the
balance sheet and profit and loss account against movements in the USD
exchange rate. This provides substantial operational and financial
stability, and it is against this background that we are able to
reiterate our strategy that has delivered so much shareholder value to
date. Our fully-protected contract backlog, of future contracted
revenues, was EUR 5.8 billion at 31 December 2007, based on long term
contracts with our customers. We continue to invest in our business to
capture the growth opportunities in the markets we serve. We are
proposing a 0.60 EUR dividend in respect of the 2007 financial result,
which will be raised by at least 10% per annum thereafter. In
parallel, we have been executing our share buyback programme. In
addition to the 103.1 million shares cancelled in March 2007, we
bought a further 7.7 million FDRs for cancellation during the rest of
the year.
Utilisation rates increased from 75.0% on 31 December 2006
(restated for GE transaction and intersegmental asset transfer) to
76.5% on 31 December 2007. The available capacity has been increased
by 44 transponders of which 20 in the SES ASTRA segment (28.2 degree E
+16, 23.5 degree E +1, 5.0E +3) and 24 in the SES AMERICOM segment
(AMC-18). The utilised capacity has been increased by 49 transponders.
31.12.2007
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*T
----------------------------------------------------------------------
Transponder utilisation Utilised % Available
----------------------------------------------------------------------
ASTRA segment 242 85.5% 283
AMERICOM segment 339 75.8% 447
NEW SKIES segment 221 69.5% 318
----------------------------------------------------------------------
SES Group 802 76.5% 1,048
----------------------------------------------------------------------
*T
31.12.2006 (after restating for the GE transaction and
intersegmental asset transfer)
-0-
*T
----------------------------------------------------------------------
Transponder utilisation Utilised % Available
----------------------------------------------------------------------
ASTRA segment 228 86.7% 263
AMERICOM segment 328 77.5% 423
NEW SKIES segment 197 61.9% 318
----------------------------------------------------------------------
SES Group 753 75.0% 1,004
----------------------------------------------------------------------
*T
General Corporate Developments
During the year, some major developments were concluded which
deliver continuing shareholder value and business security.
In the first quarter, the split-off transaction with GE was
concluded. This transaction, in which SES contributed assets and cash
in exchange for GE´s entire shareholding in SES, fulfilled a number of
important objectives, in particular the exit from minority
participations where we had overlapping assets in wholly-owned Group
companies, and the removal of the share overhang, which had been
perceived to represent a "cap" to the share price. Following the
completion of the transaction at the end of March, 103.1 million
shares were cancelled and the shares of Class C no longer exist,
simplifying our shareholder structure.
In the second quarter, a multi-launcher procurement initiative was
concluded at Group level. The long-term agreements with ILS and
Arianespace deliver substantially enhanced security of access to
space. The agreements extend the launch options available to us for
the launch of satellites, a significant commercial advantage while
launch vehicles are in high demand. The agreements have been signed in
respect of 10 forthcoming launches, and of options for further
launches.
In the third quarter, a new approach to the procurement of
in-orbit insurance for our satellites, on a Group basis, was
introduced, impacting favourably on the premiums to be paid. Combined
with our limited self-insurance undertakings, this has resulted in a
significant and continuing reduction in this important element of our
operating expenses.
As previously announced, we have set up a new division, SES
ENGINEERING, to consolidate all of the Group´s technical operations
and satellite management and procurement functions. This coordination
of all technical satellite expertise will enhance the future
development of SES´s spacecraft fleet and technical operations, and
contribute to our commitment to achieve greater operational synergies,
as well as enabling our operating companies to focus completely on
their commercial activities.
SES ASTRA
SES ASTRA once again showed solid development and robust growth in
all of its European key markets, driven by growth in Standard as well
as High Definition television broadcast services. SES ASTRA increased
its technical reach to 109 million satellite and cable households
across Europe and Northern Africa and grew the number of channels and
services delivered by the ASTRA and SIRIUS fleet to nearly 2,300
video, audio and interactive channels.
The agreement with French Canal+ Group to provide satellite
capacity on a single orbital position from SES ASTRA, following the
merger of Canal+ Group´s French operations with its competitor TPS, is
significantly enhancing SES ASTRA´s position in the French market and
confirmed SES´s attraction to broadcasters.
Other contract wins included:
- an agreement on additional capacity for the British broadcaster
ITV
- additional long-term agreements with the German public
broadcasters ARD and ZDF for further capacity especially to allow the
expansion of their digital services
- the dynamic expansion in the Dutch market through capacity
agreements with the Dutch satellite TV provider Canal Digitaal and the
Dutch regional broadcasters ROOS, strengthening the 23.5 degrees East
orbital slot as a new prime DTH position
- the contract for additional capacity for the Spanish pay-TV
operator Sogecable
- the creation of a new Ukrainian DTH platform on SES SIRIUS
The ASTRA 1L satellite was successfully launched in May 2007 and
brought into commercial service in September permitting the relocation
of the ASTRA 2C satellite to the 28.2 degrees East orbital position,
and delivering an additional 16 transponders for services to the UK
and Ireland.
The SIRIUS 4 satellite was successfully launched on 18 November
2007 and has become operational at 5 degrees East orbital position, as
of 30 December 2007, providing replacement capacities for SIRIUS 2 and
SIRIUS 3, adding seven transponders for the Nordic market, the Baltic
States, Central and Eastern Europe as well as six additional
transponders for the African market.
The number of commercially available transponders in the SES ASTRA
fleet increased by 20 during 2007. The successful deployment of ASTRA
1L allowed ASTRA 2C to be moved from 19.2 degrees East to 28.2 degrees
East thereby adding 16 commercially available transponders at this
position. ASTRA 1E replaced ASTRA 1D at 23.5 degrees East thereby
adding one commercially available transponder at this position. The
technical management of the Sirius 2 solar panels enabled three
transponders to be returned to commercial availability at 5 degrees
East.
Of the 283 transponders commercially available, 242 or 85% were
commercially utilised at 31 December, 2007, representing a net
increase of 14 transponders compared to the previous year-end (being
228 of 263 transponders at 31 December, 2006 excluding the satellite
capacity transferred to SES NEW SKIES on 1 January, 2007).
The Service businesses in the ASTRA segment continued to grow and
were an important part of the Group´s revenue growth. Key drivers
included the continued execution by ND Satcom of the Satcom Bundeswehr
project and the further expansion of Astra Platform Services in the
German market.
Other developments of SES ASTRA included the launch of the entavio
digital platform in Germany. A first framework contract to use entavio
was signed in the first half 2007 with the German pay-TV operator
Premiere. The platform was launched on 1st September on time and
within the expected budget. Following a modest take-up in the market
during the initial launch phase entavio continues to work with its
customers to optimise the offering.
SES AMERICOM
The entry of AMC-18 into service in February 2007 brought
additional capacity to service the growing requirements of America´s
leading HD neighbourhood, HD PRIME. An anchor customer on the
satellite, Comcast, signed a long term contract for HD broadcasting
capacity (HITS network) which broadcasts have begun. Following the end
of the year, an agreement was signed with Comcast for the extension of
their HD offering and the provision of future capacity requirements.
Consequently, the AMC-18 satellite capacity is now fully committed.
Other contracts included:
- capacity to support HNS´s two-way residential broadband offering
- AMC-6 capacity for Argentinian operator AR-Sat
- Turner Broadcasting System´s Satellite News Gathering (SNG)
requirements
The AMC-14 satellite is scheduled to be launched in March from
Baikonur in Kazakhstan. Our customer EchoStar is contracting the
entire payload of this satellite to support the development of its
pay-TV operations and services in North America. EchoStar will
discontinue its interim use of the AMC-2 satellite in late February.
The AMC-2 satellite will then be co-located with the AMC-4 satellite
at 101 degrees West, strengthening the service offering within the
North American footprint and enabling the activation and
commercialisation of transponders into South America.
SES AMERICOM´s utilisation rate at the period end was 76%, or 339
of 447 commercially available transponders (As reported at 31 December
2006: 78%, or 328 of 423 commercially available transponders, 2006
excluding the satellite capacity transferred to SES NEW SKIES on 1
January, 2007 and the capacity related to the sale of AMC-23 to GE).
The innovative IP-PRIME service, offering IPTV feeds (both TV and
radio) for telco and other local networks, was brought into commercial
operation in July 2007 and is being rolled out across the U.S. It is
now installed and operational in a number of telcos, and several
additional new customers are in the process of installing equipment
and will start services in the coming months.
SES NEW SKIES
SES NEW SKIES enjoyed very favourable development during 2007,
with new business levels well ahead of plan. Despite the setback of
the NSS-8 launch failure, which was destined to provide replacement
and expansion capacity at the 57 degrees East orbital position in
January 2007, NSS-703 continues to commercialise its remaining
capacity and to grow revenues in the Indian Ocean region. The NSS-12
satellite has been procured and will fill the role of NSS-8 in
replacing NSS-703 and delivering additional capacity at 57 degrees
East. It is scheduled for launch in the second quarter of 2009. At 57
degrees East and elsewhere, growth was achieved across the range of
activities served by the company, from DTH TV to GSM trunking.
Contract wins in the period included:
-- Satellite Internet trunking services to French Polynesia
-- DTH capacity for STV Cameroon
-- Impsat capacity for South American services
-- PNG Telikom for GSM backhaul services
-- Afsat for satellite broadband services in sub-Saharan Africa
SES NEW SKIES´ utilisation rate at the period end was 70%, or 221
of 318 commercially available transponders (As reported at 31 December
2006: 62%, or 197 of 318 commercially available transponders, 2006
including the satellite capacity transferred from SES ASTRA and SES
AMERICOM on 1 January, 2007).
Outlook and financial guidance
The outlook for SES remains highly robust and the strength of the
business model is clear. Our high level of contracted revenues is a
secure foundation for our future revenue growth. Our strong balance
sheet provides the capability to take advantage of future development
opportunities. We are actively managing our Treasury to maintain
adequate liquidity for scheduled bond redemptions as well as financing
of our investment programme and any potential acquisitions. Our
investment programme will deliver an increase in available capacity,
supporting future growth.
We have today published an update to our guidance on Revenue and
EBITDA ranges for 2008. Notwithstanding the negative influence of the
weaker U.S. dollar, we maintain the (euro) target ranges published in
October 2007, thus effectively upgrading our 2008 guidance.
Even after the strong performance in 2007, we reiterate our
revenue growth guidance of more than 6% in 2008 and expect compound
annual growth of over 6% for the three years to 2010, with an
infrastructure EBITDA margin of over 81%.
-0-
*T
Analyst guidance
---------------------------------------------
EUR million 29 October 07 18 February 08
---------------------------------------------------------------------
New
1 EUR = 1 EUR = Upgrade guidance
1.40 USD 1.44 USD 1 EUR =
1.44 USD
---------------------------------------------
Total
- Revenues 1623 - 1663 1603 - 1643 20 1623 - 1663
- EBITDA 1100 - 1140 1087 - 1127 13 1100 - 1140
Infrastructure
- Revenues 1355 - 1395 1340 - 1380 15 1355 - 1395
- EBITDA 1097 - 1137 1085 - 1125 12 1097 - 1137
Services
- Revenues *) 345 - 375 340 - 370 5 345 - 375
- EBITDA *) 43 - 53 42 - 52 1 43 - 53
---------------------------------------------------------------------
*) Services revenue and EBITDA exclude start-up activities
---------------------------------------------------------------------
*T
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*T
FINANCIAL REVIEW BY MANAGEMENT
In Euro millions unless otherwise stated
Summary Financial Information
----------------------------------------------------------------------
2007 2006 Variance Variance %
Revenues 1,610.7 1,615.2 -4.5 -0.3%
Operating expenses (520.4) (534.8) +14.4 +2.7%
--------------- ------------------------
EBITDA 1,090.3 1,080.4 +9.9 +0.9%
Depreciation (435.7) (438.6) +2.9 --
Amortisation (41.5) (36.5) -5.0 -13.7%
--------------- ------------------------
Operating profit 613.1 605.3 +7.8 +1.3%
Net financing charges (130.0) (80.8) -49.2 -60.9%
--------------- ------------------------
Profit before tax 483.1 524.5 -41.4 -7.9%
Income tax expense (78.3) (99.4) +21.1 +21.2%
Share of associates´ result 0.3 10.5 -10.2 -97.1%
Minority interests (1.1) 0.2 -1.3 --
--------------- ------------------------
Net profit 404.0 435.8 (31.8) -7.3%
--------------- ------------------------
Earnings per A-share (Euro) 0.91 0.82 0.09 11.0%
EBITDA margin 67.7% 66.9% +0.8 % pts. --
Net income margin 25.1% 27.0% -1.9% % pts. --
Net operating cash flow 1,192.7 1,060.1 +132.6 +12.5%
Free cash flow 672.8 (17.5) +690.3 --
Net debt 3,217.9 2,903.2 +314.7 +10.8%
Net debt / EBITDA 2.95 2.68 +0.27 +10.1%
+ 104.4 %
Net debt / Total equity 199.7% 95.3% pts --
*T
-0-
*T
Operating profit development
---------------------------------------------------------------------
2007 Q1 Q2 Q3 Q4 YTD
Revenue 399.5 389.6 406.9 414.7 1,610.7
Operating expenses (124.3) (116.6) (123.7) (155.8) (520.4)
---------------------------------------
EBITDA 275.2 273.0 283.2 258.9 1,090.3
Depreciation (127.5) (102.4) (97.4) (108.4) (435.7)
Amortisation (9.8) (9.7) (9.9) (12.1) (41.5)
---------------------------------------
Operating profit 137.9 160.9 175.9 138.4 613.1
---------------------------------------
*T
Revenue
-0-
*T
2007 2006 Variance %
Revenue 1,610.7 1,615.2 -4.5 -0.3%
*T
As reported SES Group revenues remain stable versus prior year
despite the absence of major non-recurring items, the impact of the
weakening U.S. dollar and the assets sold as part of the GE
transaction. This favourable development is driven by organic growth
and the full year contribution from SES NEW SKIES and ND Satcom. The
components of the one-off items, the U.S. dollar / scope change impact
in 2006 as well as the strong recurring growth in revenues in 2007 are
illustrated below.
(Graphic omitted)
The recurring growth of EUR 125 million or 8.5% is driven by SES
NEW SKIES and SES ASTRA. SES NEW SKIES was able to take advantage of
the growing market demand for both its original satellites and those
transferred from SES AMERICOM and SES ASTRA resulting in an overall
increase of its utilisation rates. SES ASTRA saw a strong growth for
transponder capacity in all of its key European markets, with services
businesses also growing as planned.
Operating expenses and EBITDA
-0-
*T
2007 2006 Variance %
Operating expenses (520.4) (534.8) +14.4 +2.7%
---------------- ---------------
EBITDA 1,090.3 1,080.4 +9.9 +0.9%
*T
Operating expenses declined EUR 14.4 million, or 2.7%, with the
increase from the change in consolidation scope (full year impact of
SES NEW SKIES and ND Satcom) and an increase in cost of sales based on
the higher revenue contribution from the services businesses, being
more than offset by lower transponder rental and in-orbit insurance
costs and synergies linked to the integration of NEW SKIES. This
favourable development was augmented by a weaker U.S. dollar and
continued effective cost management.
EBITDA slightly improves versus 2006 driven by the reduction of
operating expenses. The EBITDA margin of 67.7% is well ahead of prior
year (66.9%) driven by a step-up in profitability of the
infrastructure segment from 78.8% to 81.5% supported by a continued
improvement of the services businesses (excluding start-up
activities). In the following analysis the financial performance of
start-up initiatives, and one-off items, have been separately
disclosed to provide better transparency over the revenues and
profitability of on-going operations.
-0-
*T
Start-up Elimination/
Infrastructure Services initiatives Unallocated Total
2007
------------
Revenue 1,378.2 314.1 6.1 (87.7) 1,610.7
EBITDA 1,123.4 36.5 (35.1) (34.5) 1,090.3
EBITDA
margin % 81.5% 11.6% -- -- 67.7%
2006
------------
Revenue 1,416.7 271.7 -- (73.2) 1,615.2
EBITDA 1,116.6 28.5 (13.4) (51.3) 1,080.4
EBITDA
margin % 78.8% 10.5% -- -- 66.9%
*T
Operating profit
-0-
*T
2007 2006 Variance %
Depreciation (435.7) (438.6) +2.9 +0.7%
Amortisation (41.5) (36.5) -5.0 -13.7%
-----------------------------------
Operating profit 613.1 605.3 +7.8 +1.3%
*T
The charge for depreciation in 2007 was in line with the 2006
charge with the impact of the weakening U.S. dollar on SES AMERICOM
and SES NEW SKIES depreciation more than offsetting the net increase
in the Group´s depreciable fleet and the impact of the EUR 15.9
million charge taken in the first quarter due to the launch failure of
the NSS-8 satellite. The changes in the depreciable fleet were: the
sale of the AMC-23 satellite to GE in March 2007; the taking into
service of ASTRA 1KR (June 2006), AMC-18 (February 2007), and ASTRA 1L
(July 2007). The Sirius 4 satellite, launched on November 18, 2007,
entered operational service, and started being depreciated, on
December 30, 2007. The satellite entered commercial service after the
year end on January 29, 2008.
Operating profit was ahead of 2006 levels despite the lower
non-recurring revenue contributions outlined above.
Net financing charges
The charges can be analysed as follows:
-0-
*T
2007 2006 Variance %
Net interest expense (181.7) (129.9) -51.8 -39.9%
Capitalised interest 27.7 22.7 +5.0 +22.0%
Net foreign exchange gains 21.3 14.7 +6.6 +44.9%
Dividend income -- 1.5 -1.5 -100.0%
Gains on disposals 2.7 15.0 -12.3 -82.0%
Value adjustments -- (4.8) +4.8 +100.0%
------------------------------------
Net financing charges (130.0) (80.8) -49.2 -60.9%
------------------------------------
*T
Net financing charges rose by 60.9% year-on-year driven by the
increased net interest charge. This was a result of higher average net
debt levels (see below) prevailing in 2007 due to the substantial
capital expenditure spend in combination with the EUR 638.8 million
paid to GE capital in the framework of the GE split-off transaction.
Furthermore, the average weighted interest rate prevailing on the
Group´s borrowings increased from 4.58% in 2006 to 4.90% in 2007.
The interest charge also includes certain one-off items including
an amount of EUR 11.1 million representing the financing element of
upfront payments made by certain customers and EUR 3.0 million
interest provided in connection with a provision for the settlement of
potential withholding tax liabilities.
Income tax expense
-0-
*T
2007 2006 Variance %
Income tax expense (78.3) (99.4) +21.1 +21.2%
*T
The tax charge for the year stood at EUR 78.3 million,
representing a reported tax rate of 16.2% compared to 19.0% for 2006.
The rate was favourably impacted by the releasing of tax provisions
made in previous periods but no longer required - excluding these
one-time impacts the effective tax rate was 19.2%.
Net profit
-0-
*T
2007 2006 Variance %
Net profit of the Group 404.0 435.8 -31.8 -7.3%
Earnings per share (Euro) 0.91 0.82 +0.09 +11.0%
*T
Net profit attributable to equity holders of the parent is lower
than in 2006 reflecting the impact of the higher net interest charges.
Earnings per share however, at EUR 0.91, increases 11.0% compared to
prior year levels reflecting the favourable impact of the cancellation
of the Class C shares and the weighted impact of the Group´s share
buyback programme in 2006 and 2007.
Cash flow
-0-
*T
2007 2006 Variance %
Net operating cash flow 1,192.7 1,060.1 +132.6 +12.5%
Free cash flow 672.8 (17.5) +690.3 --
*T
Net operating cash flow rose strongly in 2007 with the increase of
EUR 132.6 million being generated both directly from business
operations, (EUR 77.3 million), and through the effective management
of working capital which released a further EUR 55.3 million. The
positive working capital reflects the receipt of substantial customer
upfront payments during the year.
Free cash flow, defined as net operating cash flow less cash
applied to investing activities, stood at EUR 672.8 million in 2007.
This was despite net cash outflows of EUR 628.3 million relating to
the acquisition and disposal of tangible assets, and cash balances of
EUR 69.6 million leaving the Group as a consequence of the GE
split-off transaction. Of this free cash flow, EUR 638.8 million was
applied to the repurchase of the Class-C shares acquired from GE also
in the framework of the split-off transaction.
Net debt
-0-
*T
2007 2006 Variance %
Cash and cash equivalents -197.1 -393.4 196.3 +49.9%
Loans and borrowings 3,415.0 3,296.6 118.4 +3.6%
---------------- ----------------
Net debt 3,217.9 2,903.2 314.7 +10.8%
Net debt / EBITDA 2.95 2.68 0.27 +10.1%
*T
The average level of net debt in 2007 was significantly higher
than in 2006 and this contributed to the increase in the Group´s net
interest charge noted above. In 2006 net debt rose from EUR 2,107.1
million at the start of the year to EUR 2,903.2 million at the close.
In 2007 net debt was raised to EUR 3,217.9 million in line with the
guidance on leveraging issued by management.
Contract backlog
-0-
*T
2007 2006 Variance %
Fully protected contract backlog 5,846.4 6,497.3 -650.9 -10.0%
*T
The reduction in backlog is due in part to the impact of the
strengthening of the euro on non-euro denominated contracts, and to
the Group´s disposal of its interests in AsiaSat and Satlynx during
the year. Together these impacts account for more than half of the
reduction in the reported backlog. The balance is reflecting the
normal business development in a phase where no major long-term
contracts await their renewal.
-0-
*T
SES, S.A.
CONSOLIDATED INCOME STATEMENT
For the year ended December 31
(in EURO millions)
2007 2006
Revenue 1,610.7 1,615.2
Cost of sales (164.9) (159.2)
Staff costs (187.9) (181.7)
Other operating expenses (167.6) (193.9)
Depreciation (435.7) (438.6)
Amortisation (41.5) (36.5)
----------------------
Operating profit 613.1 605.3
Finance revenue 51.7 92.0
Finance costs (181.7) (172.8)
----------------------
Profit for the period before tax 483.1 524.5
Income tax expense (78.3) (99.4)
----------------------
Profit for the period after tax 404.8 425.1
Share of associates´ result 0.3 10.5
----------------------
Profit for the year 405.1 435.6
----------------------
Attributable to Equity holders of parent 404.0 435.8
Minority interest 1.1 (0.2)
----------------------
Net profit of the Group 405.1 435.6
----------------------
*T
-0-
*T
SES, S.A.
CONSOLIDATED BALANCE SHEET
As at December 31
(in EURO millions)
2007 2006
NON-CURRENT ASSETS
Property, plant and equipment 2,723.6 3,067.7
Assets in the course of construction 765.4 695.0
----------------------
Total property, plant and equipment 3,489.0 3,762.7
Intangible assets 2,774.8 3,382.6
Investments in associates 1.6 88.6
Other financial assets 15.6 19.7
Deferred income tax assets 20.6 37.6
----------------------
Total non-current assets 6,301.6 7,291.2
CURRENT ASSETS
Inventories 15.6 23.3
Trade and other receivables 289.6 288.5
Prepayments 25.2 42.3
Valuation of financial instruments 20.6 2.6
Short-term investments -- 24.8
Cash and cash equivalents 197.1 393.4
----------------------
Total current assets 548.1 774.9
----------------------
TOTAL ASSETS 6,849.7 8,066.1
----------------------
EQUITY
Attributable to equity holders of the parent 1,578.2 3,012.2
Minority interest 33.6 32.9
----------------------
Total equity 1,611.8 3,045.1
NON-CURRENT LIABILITIES
Interest-bearing loans and borrowings 2,766.0 2,947.3
Provisions and deferred income 335.2 210.4
Deferred tax liabilities 779.7 806.0
----------------------
Total non-current liabilities 3,880.9 3,963.7
CURRENT LIABILITIES
Interest-bearing loans and borrowings 649.0 349.3
Trade and other payables 315.4 310.1
Valuation of financial instruments 15.8 22.1
Income tax payable 158.0 144.1
Deferred income 218.8 231.7
----------------------
Total current liabilities 1,357.0 1,057.3
----------------------
TOTAL LIABILITIES 5,237.9 5,021.0
----------------------
TOTAL LIABILITIES AND EQUITY 6,849.7 8,066.1
----------------------
*T
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SES, S.A.
CONSOLIDATED STATEMENT OF CASH FLOW
For the year ended December 31
(in EURO millions)
2007 2006
Profit before taxes 483.1 524.5
Taxes paid during the year (36.8) (69.8)
Net financing charges paid on non-operating
activities 75.1 43.4
Depreciation and amortisation 477.2 475.1
Amortisation of client upfront payments (27.7) (65.1)
Other non-cash items in consolidated income
statement 25.1 10.6
Consolidated operating profit before working
capital changes 996.0 918.7
Changes in operating assets and liabilities
(Increase) / Decrease in inventories 8.1 (1.7)
(Increase) / Decrease in trade and other debtors (0.4) (19.2)
(Increase) / Decrease in prepayments and deferred
charges 0.5 (7.6)
Increase / (Decrease) in trade and other creditors (3.8) 3.4
Increase / (Decrease) in payments received on
account 17.7 (7.4)
Increase / (Decrease) in upfront payments and
deferred income 174.6 173.9
Net cash (absorbed) / generated by operations 196.7 141.4
Net operating cash flow 1,192.7 1,060.1
Cash flow from investing activities
Purchase of intangible assets (20.6) (7.0)
Purchase of tangible assets (638.0) (456.5)
Disposal of tangible assets 9.7 29.7
Acquisition of New Skies Satellites (net of cash
acquired) -- (579.2)
Acquisition of ND SatCom shareholdings (net of
cash acquired) -- (40.8)
Disposal SES Re -- (15.6)
Disposal of subsidiaries sold in GE transaction,
net of cash (69.6) --
Acquisition of Glocom net of cash acquired (3.4) --
Realised proceeds on settlement of swap
transactions 205.7 (2.1)
Other investing activities (3.7) (6.0)
Net cash (absorbed) / generated by investing
activities (519.9) (1,077.5)
Cash flow from financing activities
Net increase (decrease) in borrowings 161.9 735.0
Dividends paid on ordinary shares, net of
dividends received (184.5) (215.3)
Net financing paid on non-operating activities (75.1) (43.4)
Treasury shares acquired in GE transaction (638.8) --
Net proceeds of other Treasury shares (acquired)
sold (145.3) (266.1)
Dividends from equity investments 10.2 17.4
Other financing activities 0.7 (1.5)
Net cash absorbed by financing activities (870.9) 226.1
Net foreign exchange movements 1.8 (12.1)
Net (decrease) / increase in cash (196.3) 196.6
Net cash at beginning of the year 393.4 196.8
Net cash at end of the year 197.1 393.4
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SES, S.A.
SEGMENTAL INFORMATION
For the year ended December 31, 2007
(in EURO millions)
PRIMARY GEOGRAPHICAL SEGMENTS
For the year ended December 31, 2007
----------------------------------------------------------------------
NEW
ASTRA AMERICOM SKIES OTHER ELIM. Total
External revenues 970.5 394.7 245.5 -- -- 1,610.7
Inter-segment revenues 0.9 6.5 15.8 -- (23.2) --
---------------------------------------------
Total 971.4 401.2 261.3 -- (23.2) 1,610.7
Operating expenses (293.6) (148.9) (67.3) (33.8) 23.2 (520.4)
---------------------------------------------
EBITDA 677.8 252.3 194.0 (33.8) -- 1,090.3
Depreciation (186.4) (150.2) (98.6) (0.5) -- (435.7)
Amortisation (38.6) (2.9) -- -- -- (41.5)
---------------------------------------------
Operating profit 452.8 99.2 95.4 (34.3) -- 613.1
---------------------------------------------
For the year ended December 31, 2006
----------------------------------------------------------------------
NEW
ASTRA AMERICOM SKIES OTHER ELIM. Total
External revenues 886.7 544.9 183.4 0.2 -- 1,615.2
Inter-segment revenues 8.9 1.5 7.0 14.2 (31.6) --
---------------------------------------------
Total 895.6 546.4 190.4 14.4 (31.6) 1,615.2
Operating expenses (234.6) (223.5) (71.6) (36.8) 31.7 (534.8)
---------------------------------------------
EBITDA 661.0 322.9 118.8 (22.4) 0.1 1,080.4
Depreciation (188.1) (178.9) (71.3) (0.3) -- (438.6)
Amortisation (33.3) (3.2) -- -- -- (36.5)
---------------------------------------------
Operating profit 439.6 140.8 47.5 (22.7) 0.1 605.3
---------------------------------------------
*T
Following the acquisition of SES NEW SKIES in 2006, management
responsibilities for certain operations were re-allocated resulting in
a change in the definition of these primary segments with effect from
January 1, 2007. These changes were mainly the following:
1. Responsibility for the management of the former "Asia"
operations, primarily the operations of SES ASIA S.A. and the
Group´s interest in AsiaSat, was assigned to the SES NEW SKIES
management team; and
2. The responsibility for the commercial management of certain
satellite assets in the ASTRA and AMERICOM fleets, whose
footprints were outside Europe and North America respectively,
was also re-assigned to the management team of SES NEW SKIES.
The Group accounts for inter-segment sales and transfers as if the
sales or transfers were to third parties at current market prices.
Prior year figures have been restated to reflect the changes above.
Additional information is available on our website www.ses.com
PRESS / ANALYST TELECONFERENCES
A press call in English will be hosted at 11.00 CET today, 18
February 2008. Journalists are invited to call the following numbers
five minutes prior to this time.
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Belgium +32 (0)2 789 8726
France +33 (0)1 70 99 43 04
Germany +49 (0)69 5007 1316
Luxembourg +352 342 080 8656
UK +44 (0)20 7806 1966
Confirmation Code: 1408398
*T
A call for investors and analysts will be hosted at 14.00 CET
today, 18 February 2008. Participants are invited to call the
following numbers five minutes prior to this time.
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*T
Belgium +32 (0)2 789 8726
France +33 (0)1 70 99 43 01
Germany +49 (0)69 5007 1317
Luxembourg +352 342 080 8656
UK +44 (0)20 7806 1967
USA +1 718 354 1389
Confirmation Code: 4892884
*T
A presentation, which will be referred to in each call, will be
available for download from the Investor Relations section of our
website www.ses.com.
A replay will be available on our website: www.ses.com.
Disclaimer / Safe Harbor Statement
This presentation does not, in any jurisdiction, and in particular
not in the US, constitute or form part of, and should not be construed
as, any offer for sale of, or solicitation of any offer to buy, or any
investment advice in connection with, any securities of SES nor should
it or any part of it form the basis of, or be relied on in connection
with, any contract or commitment whatsoever.
No representation or warranty, express or implied, is or will be
made by SES, its directors, officers or advisors or any other person
as to the accuracy, completeness or fairness of the information or
opinions contained in this presentation, and any reliance you place on
them will be at your sole risk. Without prejudice to the foregoing,
none of SES, its directors, officers or advisors accept any liability
whatsoever for any loss however arising, directly or indirectly, from
use of this presentation or its contents or otherwise arising in
connection therewith.
This presentation includes "forward-looking statements". All
statements other than statements of historical fact included in this
presentation, including, without limitation, those regarding SES´s
financial position, business strategy, plans and objectives of
management for future operations (including development plans and
objectives relating to SES products and services) are forward-looking
statements. Such forward-looking statements involve known and unknown
risks, uncertainties and other important factors that could cause the
actual results, performance or achievements of SES to be materially
different from future results, performance or achievements expressed
or implied by such forward-looking statements. Such forward-looking
statements are based on numerous assumptions regarding SES and its
subsidiaries and affiliates, present and future business strategies
and the environment in which SES will operate in the future and such
assumptions may or may not prove to be correct. These forward-looking
statements speak only as at the date of this presentation.
Forward-looking statements contained in this presentation regarding
past trends or activities should not be taken as a representation that
such trends or activities will continue in the future. SES, its
directors, officers or advisors do not undertake any obligation to
update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise
(1) "Recurring" is a measure designed to represent underlying
revenue / EBITDA performance by removing currency exchange effects,
eliminating one-time items, considering changes in consolidation scope
and excluding revenue / EBITDA from new business initiatives that are
still in the start-up phase.
