Global satellite communications operator SES its financial results for the first half of 2024, showing revenue of €978m, which is a 0.6% decline year-on-year. Adjusted Ebitda for the period was €525m, down by 0.9% year-on-year. These results are consistent with the company’s full-year financial outlook for 2024, said , CEO of SES, in a press statement on Thursday 1 August 2024.
Networks segment
The Networks segment, which now accounts for 54% of total revenue, grew by 5.0% year-on-year, reaching €523m. This increase was driven by a significant 8.4% growth in the government sector and an 11.1% rise in mobility, including €22m of periodic revenue in Q1 2024. Fixed data revenue declined by 8.1%, impacted by the recognition of €7m of periodic revenue in Q1 2023. The networks business secured over €310m in renewals and new contracts during H1 2024, reported SES.
Video segment
In contrast, the video segment, making up 46% of total revenue, saw a 6.7% decline year-on-year, dropping to €453m. This decrease was primarily due to lower revenue in mature markets, partially offset by double-digit growth in sports and events revenue. The video business secured over €120m in renewals and new contracts in H1 2024. A restructuring plan for a media customer in Brazil, approved by a bankruptcy court in Q2 2024, is expected to reduce revenue in 2025 by approximately 5% of the annual media revenue, noted SES.
Cash flow and debt management
SES’s adjusted free cash flow for H1 2024 was €146m, an increase of 69.8% year-on-year. This was driven by lower investing activities (€200m compared to €307m in H1 2023) and higher interest received (€61m compared to €10m in H1 2023). These gains were partly offset by higher cash tax payments and changes in working capital. Adjusted net debt to adjusted Ebitda ratio stood at 1.7 times as of 30 June 2024, down from 3.6 times on 30 June 2023 and 1.5 times on 31 December 2023, including cash and cash equivalents of €2.1bn.
Al-Saleh highlighted that H1 2024 results met expectations and reaffirmed the company’s progress towards its full-year financial goals. The introduction of O3b mPOWER into commercial service in April marked a significant milestone, with customer deployments ongoing. The next satellites in the constellation are scheduled for launch later this year, continuing into 2025 and 2026. The launch of Astra 1P in June 2024 is set to sustain SES’s cash-generative media neighbourhood while enhancing capex efficiencies.
Intelsat acquisition
SES’s strategic initiatives also include the planned acquisition of Intelsat, expected to close in the second half of 2025, subject to regulatory approvals. This acquisition, at €2.8bn, is anticipated to double revenue from growing networks segments and unlock €370m in run-rate synergies within three years. The integration planning and regulatory approval process are progressing as planned, affirmed SES on Thursday.
Contract backlog
The contract backlog as of 30 June 2024 was €3.8bn, equally divided between media and networks segments. The remaining US C-band clearing cost reimbursements are expected to total approximately $420m, and SES continues to pursue a $472m insurance claim related to O3b mPOWER satellites 1 to 4.
Dividend
SES has paid a full-year 2023 dividend of €0.50 per A-share and €0.20 per B-share. An interim dividend of €0.25 per A-share (€0.10 per B-share) will be paid in October 2024, followed by a final dividend of at least €0.25 per A-share (€0.10 per B-share) in April 2025, subject to shareholder approval.