Eutelsat Communications Sa · EURONEXT:ETL
Eutelsat Communications Sa — FY2012-13 Earnings Presentation
44 slides from Eutelsat Communications Sa's earnings presentation, Jul 31, 2013
Slide 1: Full Year 2012-2013 Results and Acquisition of SATMEX
July 31, 2013 Eutelsat Communications Full Year 2012-2013 Results and Acquisition of SATMEX
Slide 2: Agenda
Agenda KEY 2012-2013 ACHIEVEMENTS OPERATIONAL PERFORMANCE FINANCIAL OVERVIEW OUTLOOK SCALING UP IN LATIN AMERICA 2
Slide 3: Full Year 2012-2013: Key Figures
Full Year 2012-2013: Key Figures Revenues of €1,284 M, up 5.1% Revenue + 3.7% at constant currency Strong profitability: EBITDA at €995 M EBITDA 77.5% margin Group share of net income at €355 M Net result 27.6% net margin Financial Robust financial position, with Net Debt / EBITDA at 2.66x position
Slide 4: 2012-2013 Highlights: Preparing Future Growth
2012-2013 Highlights: Preparing Future Growth Three new satellites successfully launched: EUTELSAT 21B, EUTELSAT 70B and EUTELSAT 3D EUTELSAT 172A: acquisition finalised and delivering Procurement of EUTELSAT 8 West B to reinforce the 7/8°West video neighbourhood Strategic partnership signed with RS
Slide 5: Scaling up in Latin America
Scaling up in Latin America Acquisition of Satmex Procurement of EUTELSAT 65 West A 5
Slide 6: Agenda
Agenda KEY 2012-2013 ACHIEVEMENTS OPERATIONAL PERFORMANCE FINANCIAL OVERVIEW OUTLOOK SCALING UP IN LATIN AMERICA 6
Slide 7: Long-Term Visibility on Revenues and Cash Flows
Long-Term Visibility on Revenues and Cash Flows Record backlog, representing 4.2 Backlog (€bn) years of revenues Strong performance by most dynamic video neighbourhoods covering MENA 5.4 5.2 Integration of EUTELSAT 172A 5.0 as of September 2012 Video 91% 92% 92% Video remains the largest FY 2010-11
Slide 8: New Capacity for Data, Multi-Usage and Professional Video
New Capacity for Data, Multi-Usage and Professional Video Operational transponders1 Number of operational (in txp) transponders boosted by EUTELSAT 172A, EUTELSAT +7% +8% 21B, EUTELSAT 70B 858 Fill rate at 74.0%, providing 801 room for expansion and fleet 742 flexibility Fill rate2 79.2% 75.6% 74.0%
Slide 9: 2012-2013 Growth: Video and Value Added Services
2012-2013 Growth : Video and Value Added Services +4.0% Video 68.5% 832 866 Revenues (€M) FY 2011-12 FY 2012-13 +5.1%1 1,284 Data & VAS 20.0% 1,222 +7.6% 253 235 FY 2011-12 FY 2012-13 FY 2011-12 FY 2012-13 Multi-Usage 11.5% 1 +3.7% at constant currency -0.7% 147 145 FY 2011-12 FY 2012-13 Expressed a
Slide 10: Video: Strong Exposure to Growing Markets
Video : Strong Exposure to Growing Markets Growth driven by capacity added in previous fiscal year Exceptional dynamism at 7/8°West neighbourhood with long-term contracts signed with anchor customers in MENA c. 4,660 (+400 channels year-on-year), up 9.4% c. 420 HD channels, up 21% Driven by 7/8°West
Slide 11: Data and VAS Driven by Broadband
Data and VAS Driven by Broadband Data Services Stable with the inclusion of Revenues for Data & VAS (€M) EUTELSAT 172A Competition from terrestrial networks and additional satellite supply, notably +0.8% +7.6% 253 in Africa 234 235 Actions on-going to address the 65 challenge 46 50 VAS Value-Added S
Slide 12: Addressing the Data Services Challenge
Addressing the Data Services Challenge Actions taken will pay off in the medium term Terrestrial networks rollout and more satellite capacity create a situation of competitive pressure for Point-to-Point services (trunking, in particular) Indirectly impacts balance of supply and demand in applicatio
Slide 13: KA-SAT Showing Traction
KA-SAT Showing Traction c. 91,0001 activated terminals at 30 June 2013 Consumer broadband B2B solutions New consumer broadband offering Good ramp up in Professional Data launched Feb. 1st, better aligned with Networks for Business, Corporate and consumer behaviour and needs Institutions. 20Mbps/6Mbp
Slide 14: Multi-usage Stable Despite Sequestration
Multi-usage Stable Despite Sequestration Carry forward effect of February Revenues from Multi-usage (€M) / March 2012 renewal campaign February / March 2013 renewal campaign impacted by US +16.7% -0.7% federal budget sequestration 147 145 Integration of EUTELSAT 172A 126 FY 2010-11 FY 2011-12 FY 201
Slide 15: Agenda
Agenda KEY 2012-2013 ACHIEVEMENTS OPERATIONAL PERFORMANCE FINANCIAL OVERVIEW OUTLOOK SCALING UP IN LATIN AMERICA 15
Slide 16: Net Income up 8.8%, Net Margin at 27.6%
Net Income up 8.8%, Net Margin at 27.6% Extracts from the consolidated income FY 2011-12 FY 2012-13 Change statement in €M1 Revenues 1,222 1,284 +5.1% +3.7% a constant exchange rate EBITDA2 957 995 +4.0% EBITDA margin 78.3% 77.5% Strong EBITDA margin despite higher Opex Higher depreciation with full
Slide 17: High Level of EBITDA Margin Maintained
High Level of EBITDA Margin Maintained EBITDA (€M) Rise in operating expenses +4.0% linked to reinforcement of overall commercial activity, +3.3% notably for consumer and professional offers on KA-SAT 995 and regional sales offices 957 926 EUTELSAT 172A accretive to EBITDA margin EBITDA margin 79.3
Slide 18: Strong Cash Flow From Operations
Strong Cash Flow From Operations €M 816 817 6502 697 488 4861 % of revenues 70 % 42 % 57 % 40 % 64 % 51 % FY 2010-11 FY 2011-12 FY 2012-13 Cash flow from operations Investments 1 Amount net of the €60M received from the capital reduction of the Solaris joint-venture 2 Including 18 acquisition of EUT
Slide 19: Continuous Strengthening of Financial Structure
Continuous Strengthening of Financial Structure Net debt1 (€M) 2,647 M€ Net debt / EBITDA at 2.66x 2 374 M€ (from 2.48x at June 30, 2012) 800 Term Loan2 800 Term Average weighted maturity slightly Loan2 decreased to 5.0 years Average cost of debt after hedging: 4.89% 1,950 Bonds 1,650 Bonds Diversif
Slide 20: Dividend up 8%, in Line With Increase in Net Result
Dividend up 8%, in Line With Increase in Net Result Net income (€M) Dividend per share (€) +8.0% +8.8% +11.1% -3.7% 355 1.08 339 1.00 326 0.90 FY 2010-11 FY 2011-12 FY 2012-13 FY 2010-11 FY 2011-12 FY 2012-13 Shareholders Annual General Meeting 7 November 2013 20
Slide 21: Agenda
Agenda KEY 2012-2013 ACHIEVEMENTS OPERATIONAL PERFORMANCE FINANCIAL OVERVIEW OUTLOOK SCALING UP IN LATIN AMERICA 21
Slide 22: Well Positioned to Take Advantage of Industry Trends
Well Positioned to Take Advantage of Industry Trends Industry trends Fixed Satellite Services sector Already a key player in some of the growing, but at a slower pace markets where growth is and will be Growth to be driven by Video and the highest: Russia, Central Asia Broadband and Africa Data Serv
Slide 23: Growth Drivers in Our Applications
Growth Drivers in Our Applications Video Ever-growing need for more and better quality images > Growing number of TV channels: c. 22,000 in 2022 in EMEA & Latin America1 > HD penetration: 32% in EMEA & Latin America in 20221 > UHD around the corner > Specific momentum in emerging markets, with conti
Slide 24: Innovation at The Heart of Eutelsat's Future
Innovation at The Heart of Eutelsat’s Future In Space On the Ground • New encoding schemes for • New multi-spot HTS Cost of higher compression architectures developed for fast bandwidth • Enhanced access protocols for growing markets Interactive TV satellite services Increased • Signal prevention /
Slide 25: Recently Announced Satellites: Focus on Broadcast / Fast Growing Regions
Recently Announced Satellites: Focus on Broadcast / Fast Growing Regions Eutelsat focuses its future capacity on geographies & applications of highest potential AT1 / AT2 / EUTELSAT 36C 19 Ku / 8 Ku / Up to 52 Ku & 18 Ka EUTELSAT 8 West B 40 Ku, 10 C EUTELSAT 65 West A Up to 58 Ku, C, Ka Television
Slide 26: In Summary – Growth and Profitability
In Summary – Growth and Profitability Continuing focus on organic investments to consolidate our existing neighbourhoods, and build new ones Complemented where appropriate by value-enhancing external growth opportunities Enriching customer offer via innovation and service 26
Slide 27: Outlook
Outlook Revenues1 Above 2.5% growth for 2013-14 (At constant Currency, Above 5% average revenue growth in 2014-15 and 2015-16 Excl. non recurring revenues) EBITDA1 EBITDA margin at around 77% to June 2016 Capex1 €550 M per annum to June 2016 Note: this includes cash outflows related to ECA loan repa
Slide 28: Agenda
Agenda KEY 2012-2013 ACHIEVEMENTS OPERATIONAL PERFORMANCE FINANCIAL OVERVIEW OUTLOOK SCALING UP IN LATIN AMERICA 28
Slide 29: Latin America: A Highly Attractive Growth Market
Latin America: A Highly Attractive Growth Market High growth forecast in Latin America Among the fastest growing markets (# of transponders leased) (Leased capacity CAGR 2011-2016) 1,134 +7.3% CAGR +7.3% 798 592 +6.5% Video +5.8% 408 +3.6% +2.9% Data 542 390 2011 2016 LATAM Russia & Sub-Saharan Asia
Slide 30: Satmex: A Major FSS Operator in Latin America
Satmex: A Major FSS Operator in Latin America FSS OPERATIONS: 81% of revenues 3 established orbital positions FSS revenue by application (2012A)1 9% $112 M FSS Revenue 22% C, Ku and Ka-band frequency rights 69% 3 satellites in orbit, 2 satellites being procured Network Services Video Government Prim
Slide 31: Satmex: Strong Market Position
Satmex: Strong Market Position Latin America market share (2011)1 Venesat Telesat Others 2% 6% 1% #4 player in Latin America Hispasat 11% Intelsat 40% 11% market share Satmex 11% Coverage of 90% of the Americas SES 12% Star One 17% Source: Euroconsult 2012 Notes: (1) Number of transponders leased ov
Slide 32: A High Quality And Expanding Satellite Fleet
A High Quality And Expanding Satellite Fleet Number of Launch Date Orbital Satellites transponders Frequencies Manufacturer (Calendar year) Position (36 MHz TPEs) Inclined Orbit Satmex 5 December 1998 48 C, Ku 114.9°W Boeing Space Satmex 6 May 2006 60 C, Ku 113.0°W Systems / Loral Currently active S
Slide 33: Ambitious Fleet Plan to Capture Growth
Ambitious Fleet Plan to Capture Growth Capacity in transponders1 (equivalent 36MHz) +22% 2012 A-2016E: 238 CAGR 190 48 65 65 126 126 108 48 66 66 66 66 60 60 60 60 60 2012A 2013E 2014E 2015E 2016E Satmex 6 Satmex 5 Satmex 8 Satmex 7 Satmex 9 High historical fill rate in excess of 95% 12 incremental
Slide 34: Strong Customer Franchise With High Retention Rates
Strong Customer Franchise With High Retention Rates Strong Customer Relationships Blue Chip Customer Base 10-year relationships for top 10 clients Broadcasting Grupo Televisa Top 10 clients representing 56% of FSS Productora y Comercializadora de Televisión (PCTV) revenues in 2012 >95% customer rete
Slide 35: Scope For Value Creation
Scope For Value Creation High FSS operational profitability 2 0 8 5 % 1 8 0 80% Top-line growth will lead to margin 1 6 0 78% 8 0 % expansion 1 4 0 1 2 0 7 5 % 1 0 84 89 8 0 7 0 % 2012 FSS EBITDA margin of c. 80% 6 0 4 0 6 5 % 2 0 0 6 0 % 2011A 2012A FSS Ebitda ($m) FSS Ebitda margin (%) Competitive
Slide 36: Satmex Transaction Terms
Satmex Transaction Terms Acquisition of 100% of Satmex capital for $831 M Implied Enterprise Value of $1,142 M including net debt of $311 M1 Tax losses carried forward of over $450 M, valued at c.$100 M 9.7x2 EV/EBITDA based on LTM PF EBITDA3 2-year forward multiple in line with global FSS operators
Slide 37: Contributing to Eutelsat's Future Growth
Contributing to Eutelsat’s Future Growth Revenues to benefit from Satmex high single-digit growth rate Contribution Slightly dilutive to Eutelsat’s high EBITDA margin to Eutelsat’s performance Accretive to EPS in first full year after closing Pro forma June 2013 net debt / EBITDA at 3.3x (2.7x repor
Slide 38: EUTELSAT 65 West A: Multi-mission Satellite For Video and Broadband
EUTELSAT 65 West A: Multi-mission Satellite For Video and Broadband EUTELSAT 65 West A to launch early 2016 10 C-band transponders (54 MHz) 24 Ku-band transponders (36 MHz) Up to 24 Ka-band spotbeams Exposure to high growth video and broadband markets in Brazil and Latin America DTH platforms, video
Slide 39: Satmex and EUTELSAT 65 West A: Complementary Coverage in Latin America
Satmex and EUTELSAT 65 West A: Complementary Coverage in Latin America Satmex EUTELSAT 65 West A leading markets MEXICO key target market Satmex 5 and 7 114.9°W Eutelsat 65 West A COLOMBIA 65°W ECUADOR BRAZIL PERU Satmex 8 and 9 Satmex 6 116.8°W 113.0°W CHILE 39
Slide 40: Eutelsat's Expanded Global Network
Eutelsat’s Expanded Global Network 40
Slide 41: Appendix
41 Appendix a1 @&° eutelsat
Slide 42: Satmex's Orbital Locations
Satmex’s Orbital Locations Satmex 5 footprint Satmex 6 footprint Satmex 8 footprint Orbital position: 114.9°W Orbital position: 113.0°W O rbital position: 116.8°W C1 Band C2 Band C Band C Band C3 Band Ku1 Band Ku1 Band Ku1 Band Ku2 Band Ku2 Band Ku2 Band Ku3 Band Source: Satmex Information 42
Slide 43: Disclaimer
Disclaimer This presentation does not constitute or form part of and should not be construed as any offer for sale of or solicitation of any offer to buy any securities of Eutelsat Communications, nor should it, or any part of it, form the basis of or be relied on in connection with any contract or
Slide 44: Disclaimer
Disclaimer This presentation does not constitute or form part of and should not be construed as any offer for sale of or solicitation of any offer to buy any securities of Eutelsat Communications or Satélites Mexicanos, SA de CV (“Satmex”), nor should it, or any part of it, form the basis of or be r
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