SES SA FDR (Class A) · EURONEXT:SESG
SES SA FDR (Class A) — SES — Investor Presentation (September 2018)
33 slides from SES SA FDR (Class A)'s investor presentation, September 2018
Slide 1: Investor presentation
Investor presentation September 2018 SES investor presentation I September 2018
Slide 2: Table of Contents
Table of Contents Understanding the business Performance review and detailed dynamics Overview Industry Structure and Changes Business Overview Business Transformation and Differentiation Financial Outlook Video Distribution and Services Strategic Priorities Fixed Data, Mobility and
Slide 3: Overview
Overview Overview and Business Description Structure and Financials Outlook and Equity Market ▲ World’s leading satellite-enabled solutions provider EUR 2 billion Financial outlook assumes a EUR/USD rate of 1.15 and nominal satellite health/launch status SES Video Covering 99% of the globe and world
Slide 4: Business Overview
Business Overview SES Video (68% of revenue) SES Networks (32% of revenue) Resilient high margin business delivering strong cash flows for Growth engine focused on fast expanding data segments: reinvestment in future growth and return to shareholders Fixed Data, Mobility and Government Video Distrib
Slide 5: Financial Outlook
Financial Outlook Revenue and EBITDA margin(1) EUR million 2,110 – 2,210 2,011 >40% of revenue | Networks 32% of revenue ▲ Strong growth engine for the SES business ▲ Satellite becoming more mainstream in data networks 68% of revenue <60% of revenue | Video ▲ Large, profitable and stable video neigh
Slide 6: Strategic Priorities
Strategic Priorities | Video Develop and reinforce our core video neighbourhoods Develop differentiated global value-added services capabilities MOVING IMAGES THAT MOVE THE WORLD Build hybrid satellite and terrestrial network capabilities | Networks Optimising services across our unique GEO-
Slide 7: SES Video
SES Video Resilient high margin business delivering strong cash flows for reinvestment in future growth and return to shareholders ▲ Stable business Revenue development (EUR Million) ▲ High visibility with: % of contracted future revenue Status at FY 2017 end and in EUR million 1,336 1,392 1,383 210
Slide 8: SES Video - Market Dynamics
SES Video - Market Dynamics Linear TV remains the leading mass market medium SES Opportunities Market size Advertising spending ▲ Content rights owners focus their ▲ Better quality HD and UHD with USD billion(1) USD billion(2) enhanced compression 283 243 efforts on building OTT, but linear 228 191
Slide 9: SES Networks
SES Networks Growth engine focused on fast expanding data segments where SES has clear competitive advantages ▲ Positioned to grow Revenue development (EUR Million) ▲ Improved business mix with: % of contracted future revenue Status at FY 2017 end and in EUR million 616 627 646 Fixed Data GEO-MEO co
Slide 10: SES Networks - Market Dynamics
SES Networks - Market Dynamics Connectivity needs are booming and satellite has a role to play SES Opportunities Global IP traffic(1) ▲ People and organisations expect to be connected everywhere, all the ▲ ‘Big Data’ and ‘Internet of things’: Exabytes(2) per month 278 time, creating exponential rate
Slide 11: Innovation and Technology
Innovation and Technology Doing the same for less: Normalised CapEx and cost reduction 1/ Improved space technologies x 2/ SES scale advantage SES’s Normalised CapEx development EUR million Electrical propulsion Economies of scale 100 Improved mass efficiency Improved satellite efficiency enab
Slide 12: Financial Potential
Financial Potential P&L: 2017 a transition year enabling business transformation and business mix improvement EUR Million 2016 2017 Comment SES Financial Framework: Secures focus on value creation ~50% of revenues USD denominated with natural Average EUR/USD 1.106 1.125 hedge down the P&L and Cash F
Slide 13: Conclusion
Conclusion SES’s Financial Framework Strategy in place ▲ SES Video highly profitable and resilient ▲ Revenue growth driven by SES Networks ▲ Delivering EBITDA and operating CF growth Transformation to new Operating model ▲ Increasing capital efficiency / productivity • Supporting improved EBIT a
Slide 14: SES IN DETAIL
SES IN DETAIL
Slide 15: Industry Structure going through Disruptive Changes
Industry Structure going through Disruptive Changes Video Networks Content Backend Infrastructure Experience Satellite Network / Data Service End user production provider provider provider infrastructure Platform Provider Before: Satellite core to TV distribution Before: Satellite last resort connec
Slide 16: Business Transformation and Value of Differentiation
Business Transformation and Value of Differentiation SES is undergoing a significant business transformation, leveraging its leadership position in Video to accelerate the development of Networks businesses to benefit from growing connectivity needs and by investing in new capabilities to improve Vi
Slide 17: Video Distribution - 52% of group revenue
Video Distribution - 52% of group revenue Robust high margin business delivering strong cash flows for reinvestment in future growth and return to shareholder ▲ Market forecast (NSR 2017) ▲ Stable delivery, with robust underlying and high visibility ▲ Recent performance Video satellite capacity (USD
Slide 18: Video Services - 16% of group revenue
Video Services - 16% of group revenue Enhancing Video offering and improving end viewer experience to support video resilience and business stickiness ▲ Market forecast (IHS 2017) ▲ Services development ▲ Recent performance Backend / OTT service (EUR Million) Revenue development (EUR Million) • New
Slide 19: Fixed Data - 13% of group revenue
Fixed Data - 13% of group revenue Leveraging unique GEO-MEO network and solution expertise to tackle connectivity growth ▲ Strong market opportunity ▲ Transforming business model to capture growth Capacity and services (USD Million Revenue development (EUR Million) ▲ Recent performance SES estimates
Slide 20: Mobility - 7% of group revenue
Mobility - 7% of group revenue Providing ‘home connectivity’ to passenger and crew of Aeronautics and Maritime or Energy segments ▲ Significant growth expected ▲ Transforming business model to capture growth Capacity and services (USD Million Revenue development (EUR Million) ▲ Recent performance NS
Slide 21: Government - 12% of group revenue
Government - 12% of group revenue Addressing government needs and constraints and providing unique capabilities ▲ New applications driving demand ▲ Transforming business model to capture growth Capacity and services (USD Million Revenue development (EUR Million) ▲ Recent performance NSR - SES estima
Slide 22: Satellite Fleet: Leveraging over 70 satellites in two orbits
Satellite Fleet: Leveraging over 70 satellites in two orbits World’s biggest satellite fleet Current fleet Geostationary Orbit From earth satellite appears fixed Fleet configuration is based on current (36,000 km from Earth) 600 milliseconds latency planning and is subject to change Medium Earth Orb
Slide 23: Technology and Launch Schedule
Technology and Launch Schedule Optimising technology model to leverage satellite strength and expand its role beyond traditional scope Relying on Industry-leading network Service resilience from agile fleet Bold to integrate latest innovations performance with: management with a calculated risk appr
Slide 24: Financials (1/4)
Financials (1/4) Historical reported P&L Revenue and OpEx EUR Million 2013 2014 2015 2016 2017 ▲ Revenue and OpEx in 2017 included full year contribution from O3b and RR Media (which were consolidated by SES during H2 2016) Average EUR/USD 1.326 1.335 1.115 1.106 1.125 Group operating expenses Total
Slide 25: Financials (2/4)
Financials (2/4) Free Cash flow efficiencies Optimised CapEx schedule Free cash flow and CapEx development GEO-MEO Capital Expenditure (growth and replacement) As a % of group revenue EUR million 1,130 40% 39% 180 37% 100 588 550 492 460 20% 22% 64 430 22% 380 83 80 850 90 310 90 110 524 100 409 100
Slide 26: Financials (3/4)
Financials (3/4) Historical reported Balance Sheet EUR Million 2013 2014 2015 2016 2017 Comments Closing rate EUR/USD 1.379 1.214 1.089 1.054 1.199 Property, Plant & Equipment 3,747.7 4,341.6 4,464.8 5,156.3 4,591.4 Of which over 90% representing Space segment (satellite fleet) Assets Under Construc
Slide 27: Financials (4/4)
Financials (4/4) Total Debt and Loan repayment schedule Senior debt repayment schedule Debt Currency Mix Fixed / Floating Mix EUR million(1) 5% 1,352 42% 58% 95% 691 708 669 541 476 516 EUR USD ▲ Average cost of debt of 3.7% and average 156 56 16 16 0 maturity of 7.0 years 2018 2019 2020 2021 2022 2
Slide 28: Governance
Governance Shareholding structure as of 17 July 2018 The Board of Directors ▲ A and B Shares, each share is entitled to one vote and a B-share carries 40% of the economic rights of an A-share Defines company’s strategic objectives and overall corporate plan. Is also Number of % Voting % Economic A s
Slide 29: SES Management
SES Management The Senior Leadership Team A collegial body, in charge of the daily management of the group; is mandated to plan/execute the overall strategy, approved by the Board 8 Members, nominated by the board of directors, Including President and CEO, CEO Video, CEO Networks, CFO, CSDO, CTO, CL
Slide 30: Compliance and Corporate Social Responsibility
Compliance and Corporate Social Responsibility Compliance ▲ SES is committed to conduct its business in compliance with all laws and regulations as well as to observe the highest standards of business ethics, more information on: www.ses.com/about-us/corporate-governance ▲ We support and develop ini
Slide 31: Financial Calendar & Stock Market Information
Financial Calendar & Stock Market Information Stock market info Financial calendar ▲ Listed on Euronext Paris Luxembourg Stock Event Date Exchange ▲ Bloomberg: SESG FP equity FY 2017 results 23 February 2018 ▲ Reuters: SESFd.PA Q1 2018 results 27 April 2018 ▲ ISIN: LU0088087324 Consensus(1) as at 17
Slide 32: IR Contacts
IR Contacts SES Investor Relations team Richard Whiteing Antoine De Brosses Vice President Manager Head of Investor Relations Investor Relations [email protected] [email protected] +352 710725 261 +352 710725 413 +352 691 898956 Ralph Rauschenberger Michelle Suc Vice President Investo
Slide 33: Disclaimer
Disclaimer This presentation does not, in any jurisdiction, including without limitation in the U.S., 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