The 37th meeting of the EUTELSAT IGO Advisory Committee (AC) took place last 18 March in Paris, chaired by Poland (Piotr Dmochowski-Lipski).
Representatives of all seven states on the AC attended the meeting, i.e. France, Italy, Luxembourg, Poland, Portugal (which took part simultaneously as chair of the Assembly of Parties (AP)), Spain and Switzerland. Montenegro and Azerbaijan participated as observers.
The Parties were informed by the Executive Secretary (ES), Christian Roisse of France, about changes in the Board of Directors, composed of ten directors, of whom five are women. The new chief executive officer (CEO), Rodolph Belmer, took office on 1 March 2016, replacing Michel de Rosen, who remains in the company as non-executive president. Jean-Paul Brillaud, who was formerly deputy CEO, has left the Board, with Michel Azibert occupying that post.
The EUTELSAT IGO ES reported on activities conducted since the last Committee meeting in October up to the present, especially regarding supervision of the company Eutelsat S.A., which is monitored by the IGO and whose financial situation continues to ensure conditions enabling compliance with the Basic Principles.
The ES informed the committee about the Eutelsat group’s current shareholder structure. The investment firm Fonds Stratégique de Participations, in which the six biggest French insurers hold stakes, became the second largest shareholder by acquiring new shares. It now holds a 7 percent stake and aims to join the holding’s Board of Directors, subject to endorsement by the shareholders, who gather in General Assembly this coming November.
BPI France Participations (ex-FSI), a public investment bank formed by the French state and Caisse des Dépôts, is still the main shareholder, holding 26 percent of the company. The Chinese sovereign wealth fund (China Investment Corporation) is now the third-ranking shareholder, with a 6.8 percent stake. Approximately 60 percent, or nearly two-thirds of Eutelsat’s shares, float freely on the stock exchange.
The Committee noted the financial results for the first half of financial year 2015-2016, which ended last 31 December, in line with though below the forecasted growth of between 2 and 3 percent: growth of the company’s income was actually around 1.5 percent, but is holding firm and expected to recover during this half-year to achieve the set targets, probably around 2 percent.
During the current period Eutelsat S.A. posted income of 774 million euros, maintaining the company’s margin of earnings before interest, taxes, depreciation and amortisation (EBITDA) stable at 77.5 percent, reflecting gains on the order of 600 million euros, with a backlog of 5.8 billion euros, representing nearly four years of contracted revenue. The company’s debt/EBITDA ratio rose slightly to stand at 3.2:1 at end 2015, below the 3.75:1 limit set in the letter-agreement signed on 2 September 2005 by the operator and the IGO. Note that 3.3:1 is the level that must be attained for shares to be classified as 'to invest'. Video applications continue to originate two-thirds of the group’s revenue, versus the one third originated by data.
The company was represented at the meeting by deputy CEO Michel Azibert, in charge of the commercial area and development at Eutelsat S.A., who gave a presentation on its future prospects and financial results. He admitted that the results are below what was predicted and recommended to financial investors, but stressed that the satellite operators that directly compete with Eutelsat (Intelsat and SES) reported negative growth during the same period. Improved coverage of Asia is one of the group’s commitments. The company has successfully launched four new satellites since the last AC meeting and expanded the Africa Broadband Initiative. In February it agreed on a new joint venture with the ViaSat operator, with the main aim of increasing the European broadband offering. The fleet of Eutelsat S.A. comprises 40 geostationary satellites covering two-thirds of the world’s population; it is now the world’s third-ranking satellite operator.
Regarding interference affecting Eutelsat satellites which originates in the Middle East, the ES reported that the situation since the last report sent to the Parties in October has significantly improved, with only sporadic interference cases registered. Due to the limited number of incidents, the ES noted that agreement was reached with Eutelsat S.A. that the company’s reports in that regard would henceforth be half-yearly, with the next one to be sent to the parties in the spring.
As AP chair, Portugal informed the Committee that the letter with the request for candidates for the ES post would be sent to the Parties on 4 April 2016 and that the deadline to present candidacies was 15 November. Information about the Parties put forward as candidates will be sent to the Parties by 29 November. The new ES will be elected at the next AP, to be held on 15-16 March 2017.
Following a proposal by Poland and Luxembourg, the AC once again debated the future format, detail level and manner of approval of its report. Basically, the Committee opted to keep its current format. It was agreed that the meetings' agenda would henceforth include a point summarising the key points of the report from the Committee’s previous meeting.
The next AC meetings have been scheduled for 9 December 2016 and 26-27 January 2017.
