Eutelsat sees bigger than expected fall in revenues

Eutelsat missed its financial targets for its fiscal first quarter with a bigger than expected decline in revenues. CEO Rodolphe Belmer blamed the dip on “worsening trends in data and professional video and the unplanned return of a couple of transponders in Russia”.

The company posted revenues of €335.1 million, down 6% on a like -for-like basis. Revenues from the company’s operating verticals stood at €346.5 million, down 6.2% on a like-for-like basis.

Broadcast revenues were down a relatively modest 1.7% to €194.7 million, but data and professional video services declined by 19.6% to €43 million, with the company hit by priding pressure and competition, the loss of data sales in Latin America and lower occasional use sales.

Government services, fixed broadband and mobile connectivity were all down.

Eutelsat said that the decline in broadcast revenues reflected the termination of a contract in sub-Saharan Africa and the return of two transponders in Russia, with the company saying that “none of these elements alter our view of broadcast as a fundamentally resilient business”.

At 30 September 2019, the total number of channels broadcast by Eutelsat satellites stood at 6,976, down 0.3% year-on-year. The number of HD channels stood at 1,582 versus 1,419 a year earlier, up by 11.5% and represented 22.7% of channels compared to 20.3% a year earlier.

Eutelsat did sign two multi-year, multi-transponder contracts with Orby TV for capacity on Eutelsat 117 West A for the launch of a new DTH service across the United States, and with Ultra DTH for capacity on Eutelsat 65 West A to support the deployment of a white-label DTH platform across the Caribbean and Andean regions.

The company maintained its outlook for the full year, but with an increasing likelihood of landing in the bottom half of its range of operating verticals revenues of €1.28-.32 billion.