SES Reports 13.5% Jump in First Half 2008 Net Profit Earnings Per Share Boosted By 40%

Business Wire, August 4, 2008

BETZDORF, Luxembourg -- SES S.A., the pre-eminent satellite operator worldwide (Paris:SESG) (LuxX:SESG), reports financial results for the six months ended 30 June 2008.

FINANCIAL HIGHLIGHTS

* Reported revenue stable at EUR 788.5 million (2007: EUR 789.1 million)

* Despite the effect of the weaker U.S. dollar

* Recurring1 revenue was up 8.7% on the prior year period

* Reported EBITDA also stable at EUR 550.2 million (2007: EUR 548.2 million)

* Recurring1 EBITDA was 7.7% ahead of the prior year period

* Infrastructure EBITDA margin of 82.5% (2007: 82.2%)

* Operating profit was up 10.3% at EUR 329.5 million (2007: EUR 298.8 million)

* Net profit grew by 13.5% to EUR 235.8 million (2007: EUR 207.8 million)

* Weighted earnings per share rose over 40% to EUR 0.59 (2007: EUR 0.42)

* Group backlog (contracted future revenues) of EUR 5.7 billion at 30 June

* Group transponder utilisation rate at 30 June 2008 was 77% (2007: 75%)

Romain Bausch, President and CEO of SES, commented:

"SES has delivered excellent results so far this year, and we expect this to continue in the second half. Recurring revenue, EBITDA and profit have all grown strongly. SES NEW SKIES has continued to outperform, while performance at SES ASTRA and SES AMERICOM has also been solid. Our competitive positioning is as good as it has ever been, and the outlook remains very positive as demand is projected to outpace supply. We also secured additional funding for the business on favourable terms, and continued our share buyback programme, cancelling 33.9 million, or 6.4%, of our shares in June. In addition, we updated our financial guidance, with the raised range demonstrating our confidence in the business outlook. As always, our focus remains squarely on delivering outstanding shareholder value. "

BUSINESS REVIEW

The first six months of 2008 have seen growth across all our business segments, with SES NEW SKIES delivering new business ahead of expectations and SES ASTRA remaining a key growth driver. Growth is coming from all areas of our activities, led by video broadcasting and the continued rise in the number of TV channels, augmented by growth of High-Definition (HD) channel offerings in all main markets. Services revenues also grew in the period.

The financial results presented today confirm this progress with recurring revenue and EBITDA showing high single digit growth and net profit rising by 13.5%. The combination of the strong operating results, the share buyback and cancellation programme, and the GE split-off transaction in 2007, has delivered a 40% rise in earnings per share compared to the same period of 2007.

In the period, the SIRIUS-4 satellite was brought into operation at the 5 degrees East orbital position, with beams serving the Nordic region, Central and Eastern Europe and the SES ASTRA-owned beam named ASTRA 4A serving sub-Saharan Africa. The SIRIUS-2 satellite has been renamed ASTRA 5A and has started operations at the new European orbital position of 31.5 degrees East.

The launch failure of AMC-14 in March led to the satellite being declared a total loss. The insurance proceeds were received before 30 June. It is not expected that SES will procure a follow-on satellite for EchoStar, the intended customer for the failed satellite.

Utilisation rate of the fleet remains stable at 77% compared to 31 March 2008. The available capacity on 30 June 2008 increased by 26 transponders from 1,038 to 1,064 transponders following the activation of the new orbital position 31.5 degrees East in the SES ASTRA segment. Total utilised transponders increased from 803 transponders at 31 March 2008 to 820 transponders at 30 June 2008.

Transponder data (physical units) at 30 June 2008

Transponder utilisation  >            >  Util-  >             >
%

Available







ASTRA segment            >            >    252  >             >
79.5%

317







AMERICOM segment         >            >    334  >             >
77.9%

429







NEW SKIES segment        >            >    234  >             >
73.6%

318







SES Group                >            >    820  >             >
77.1%

1,064

Within the SES fleet we operate nine Lockheed Martin A2100 satellites which have experienced varying degrees of power loss in some of their solar array circuits. To date, the power loss has caused a minor reduction in available commercial capacity in two of these nine satellites (AMC-4 and AMC-16). AMC-4 C-band customers have been transferred to AMC-2, which has been co-located with AMC-4 at the 101 degrees West orbital position. The AMC-16 satellite capacity reduction resulted in an adjustment to the monthly revenue payments by the customer.

Together with Lockheed Martin, we have undertaken an extensive assessment of the potential impact of solar array circuit anomalies across the fleet. There is some potential for future additional degradation, although the likelihood of this is difficult to estimate. SES has in-orbit backup capacity for certain of these satellites. If the observed solar array circuit degradation continues at historical rates, over time we may need to switch off additional payload on affected satellites or advance the procurement of replacement satellites. Contingency plans are in place such that the impact on SES group revenues and replacement capital expenditure requirements is anticipated to be marginal. Our existing in-orbit insurance policy provides coverage based on the net book value of our satellites. The policy includes a deductible that may limit any proceeds from future insurance claims related to such anomalies. Current and future financial guidance will incorporate any development relating to the SES fleet health.