April 26, 2019 / 6:26 AM / 6 months ago

Satellite company SES Q1 profit drops, maintains FY outlook

April 26 (Reuters) - Luxembourg-based satellite operator SES said on Friday its first-quarter core profit dropped 5 percent year-on-year, but was in line with expectations, boosted by the company’s Networks division.

Earnings before interest, taxation, depreciation and amortisation (EBITDA) came in at 290.1 million euros ($322.94 million) on a like-for-like basis, slightly above 288 million euros expected by analysts in a consensus compiled for the company.

“A solid start to 2019 with our Q1 results fully in line with our expectations,” Chief Executive Steve Collar said.

SES, a Wi-Fi service provider for planes and ships, expects its 2019 EBITDA to come within the range of 1.22 billion euros to 1.27 billion euros, and revenue between 1.98 billion euros and 2.04 billion euros.

“We look forward to the entry into service in early Q3 of the four additional O3b satellites recently launched, completing the original constellation and paving the way for O3b mPOWER in 2021,” Collar added.

The company’s total revenue rose 0.6 percent to 480.6 million euros, driven by its Networks division. Solid growth in Networks’ segments - Fixed Data, Mobility and Government - offset the drop in revenue in the company’s Video division.

Underlying revenue in SES’s core Video business dropped 7.3 percent at constant exchange rates, a bigger-than-expected decline due to lower video distribution revenue, including in the North American wholesale business.

SES said its financial outlook remained unchanged, but it might face challenges in its Video division, which managed to generate 63 percent of revenue in the first quarter.

Earlier in February, the satellite company lowered its 2020 outlook to reflect a more prudent view of its core division. Under the current guidance, SES Video revenue exposure is expected to fall to below 60 percent by the end of next year. reut.rs/2vkC80b

$1 = 0.8983 euros Reporting by Pawel Goraj, Editing by Sherry Jacob-Phillips ;

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