SES - comment

Results came in close to target, which was well guided for. Overall, the disclosure of pro forma financials (as if Intelsat had been consolidated from the start of the year) is poorer than we had hoped. We’ll still have to be creative in the modelling. While Video and Fixed Networks continue to fall at double-digit rates (Video to fall organically only by mid single-digit rates, but there will always be one-offs), the rising tide in Government spending should float all boats. Management reported that Space had been elevated to a “War Fighting Domain” alongside Ground, Sea, Air and Cyber, which would elevate the demand for its underlying architecture beyond the ons and offs of any single conflict. For 2026, management therefore foresees flat Revenue and EBITDA YoY, while Further Opex reduction and, in particular, CapEx containment to €700m (€50m lower than we thought) should slightly reduce leverage. Proceeds from Round 2 C-Band compensation are not expected before 2027, but will be used to reduce debt until achieving 3x Net Leverage. The bonds seem accurately priced for now.