EUTELSAT COMMUNICATIONS S.A.
Société anonyme with a Board of Directors and a share capital of 230,544,995 euros Registered office: 32 boulevard Galliéni, F-92130 Issy les Moulineaux
481 043 040 R.C.S. NANTERRE
MANAGEMENT REPORT OF THE BOARD OF DIRECTORS
ON THE CONSOLIDATED AND COMPANY FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
Note: The English version of this Management Report is a free translation of the French version and is provided solely
for the benefit of English-speaking users.
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INTRODUCTION.................................................................................................................................. | 7 | |
1 - KEY HIGHLIGHTS IN THE FINANCIAL YEAR ........................................................................ | 8 | |
1.1 | MAIN HIGHLIGHTS OF FY 2021-22 ................................................................................ | 8 |
1.2 | REVENUES BY BUSINESS APPLICATION ................................................................... | 9 |
1.3 | FINANCIAL PERFORMANCE............................................................................................ | 9 |
1.4 | OTHER OPERATION INDICATORS ................................................................................ | 9 |
1.4.1 Operational and utilized transponders .......................................................................... | 9 | |
1.4.2 Backlog ............................................................................................................................ | 10 | |
1.5 | ALTERNATIVE PERFORMANCE INDICATORS ......................................................... | 10 |
1.6 | CHANGES IN PERIMETER ............................................................................................. | 12 |
1.7 | POST CLOSING EVENTS................................................................................................ | 12 |
1.7.1. Eutelsat and OneWeb to combine.................................................................................... | 12 | |
1.7.2. Exclusive commercial partnership with OneWeb ........................................................... | 13 | |
1.7.3. COMETE PROJECT........................................................................................................... | 13 | |
2 - PRESENTATION OF THE GROUP'S ACTIVITIES, MARKETS AND STRATEGY .......... | 14 | |
2.1 | A SUSTAINABLE BUSINESS MODEL........................................................................... | 14 |
2.2 | GROUP'S ACTIVITIES...................................................................................................... | 16 |
2.2.1. Broadcast ............................................................................................................................. | 16 | |
2.2.2. Connectivity.......................................................................................................................... | 18 | |
2.3 MAIN MARKETS AND COMPETITION ............................................................................... | 19 | |
2.3.1 The Fixed Satellite Services industry ................................................................................ | 20 | |
2.3.2 Broadcast businesses - market prospects ...................................................................... | 22 | |
2.3.3 Connectivity Applications - market prospects ................................................................. | 23 | |
2.4 | GROUP STRATEGY ......................................................................................................... | 25 |
2.4.1 Maximising Free Cash Flow generation ........................................................................... | 25 | |
2.4.2 Returning to growth by seizing long-term opportunities in Connectivity ...................... | 26 | |
2.4.3 Extra-FinancialGroup strategy .......................................................................................... | 28 | |
3 - CORPORATE ENVIRONMENTAL, SOCIAL AND SOCIETAL RESPONSIBILITY .......... | 29 | |
3.1 CHALLENGES AND CSR POLICY ...................................................................................... | 29 | |
3.1.1 CSR governance .................................................................................................................. | 29 | |
3.1.2 Relations with stakeholders ................................................................................................ | 29 | |
3.1.3 Main non-financialrisks....................................................................................................... | 32 | |
3.1.4 Opportunities for the Company .......................................................................................... | 34 | |
3.1.5 Awards for the CSR policy .................................................................................................. | 35 | |
3.1.6 Eutelsat's contribution to the United Nations sustainable development goals ........... | 35 | |
3.1.7 Dashboard for Eutelsat's non-financial performance statement ................................... | 37 | |
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3.2 INTEGRITY AND ETHICS ..................................................................................................... | 38 |
3.2.1 Commitment of the governing body .................................................................................. | 38 |
3.2.2 Compliance policy ................................................................................................................ | 38 |
3.2.3 Governance........................................................................................................................... | 40 |
3.2.4 Consumer health and safety measures ............................................................................ | 41 |
3.3 SOCIETAL INFORMATION ................................................................................................... | 41 |
3.3.1 Helping bridge the "digital divide" ...................................................................................... | 41 |
3.3.2 Eutelsat's commitment to humanitarian programmes .................................................... | 43 |
3.3.3 Territorial impact of the Group's activities on employment and regional development
..........................................................................................................................................................44
3.4 ENVIRONMENTAL INFORMATION .................................................................................... | 45 |
3.4.1 Global environmental policy ............................................................................................... | 45 |
3.4.2 Impacts of our operations on Space's environment........................................................ | 46 |
3.4.3 Pollution on Earth ................................................................................................................. | 48 |
3.4.4 European Green Taxonomy ............................................................................................... | 51 |
3.5 SOCIAL INFORMATION ........................................................................................................ | 51 |
3.5.1 Employment .......................................................................................................................... | 51 |
3.5.2 Quality of life at work ........................................................................................................... | 52 |
3.5.3 Labour relations.................................................................................................................... | 54 |
3.5.4 Health, safety, and well-beingin the workplace .............................................................. | 55 |
3.5.5 Training and career management...................................................................................... | 57 |
3.5.6 Diversity and equal opportunities....................................................................................... | 58 |
3.5.7 Respect for the fundamental conventions of the International Labour Organization | |
(ILO) ................................................................................................................................................. | 59 |
3.6 OUTSOURCING AND RELATIONSHIPS WITH SUPPLIERS......................................... | 59 |
3.7 HUMAN RIGHTS ACTIONS .................................................................................................. | 60 |
3.7.1 Human rights......................................................................................................................... | 60 |
3.7.2 Media freedom...................................................................................................................... | 60 |
3.7.3 Combatting intentional interference................................................................................... | 61 |
3.8 INDICATORS ........................................................................................................................... | 61 |
3.8.1 Social Information................................................................................................................. | 61 |
3.8.2 Environmental information .................................................................................................. | 62 |
3.8.3 Societal information ............................................................................................................. | 63 |
3.9 NOTE ON THE METHODOLOGY ........................................................................................ | 64 |
3.9.1 Methodology.......................................................................................................................... | 64 |
3.9.2 Scope ..................................................................................................................................... | 64 |
3.9.3 Verification of the report ...................................................................................................... | 64 |
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4 - GROUP RISK FACTORS, INTERNAL CONTROL PROCEDURES AND RISK | |
MANAGEMENT.................................................................................................................................. | 66 |
4.1 OPERATIONAL RISKS ..................................................................................................... | 66 |
4.2 RISKS RELATING TO CHANGES IN THE SATELLITE TELECOMMUNICATIONS
MARKET.......................................................................................................................................... | 69 | |
4.3 | RISKS RELATING TO CLIENTS ..................................................................................... | 71 |
4.4 | REGULATORY RISKS ...................................................................................................... | 72 |
4.5 | FINANCIAL RISKS............................................................................................................. | 74 |
4.6 | INTERNAL CONTROL PROCEDURES AND RISK MANAGEMENT POLICY........ | 77 |
4.6.1 Procedures relating to the satellite fleet and its operation ....................................... | 77 | |
4.6.2 Procedures for preventing and managing the Group's other operating risks ....... | 80 | |
4.6.3 Prevention and management of the Group's commercial risks .............................. | 82 | |
4.6.4 Management of financial risks...................................................................................... | 83 | |
5 - A YOUNG FLEET WITH COVERAGE OF MOST OF THE GLOBE .................................... | 84 | |
5.1 | SATELLITE FLEET ............................................................................................................ | 84 |
5.2 | FLEET PERFORMANCE .................................................................................................. | 86 |
5.3 | AN ACTIVE INVESTMENT POLICY ............................................................................... | 86 |
5.4 LAUNCH SERVICES ASSOCIATED WITH SATELLITES UNDER
PROCUREMENT ........................................................................................................................... | 87 | ||
6 | - ACTIVITIES OF SUBSIDIARIES AND EQUITY INTERESTS ............................................. | 88 | |
6.1 | GROUP SIMPLIFIED ORGANISATIONAL CHART ..................................................... | 88 | |
6.2 | MAIN SUBSIDIARIES AND EQUITY INTERESTS....................................................... | 89 | |
6.2.1 | Eutelsat S.A. ................................................................................................................... | 89 | |
6.2.2 Main subsidiaries of Eutelsat S.A. ..................................................................................... | 89 | ||
7 | - CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 - | ||
FINANCIAL INFORMATION............................................................................................................. | 91 | ||
7.1 | FINANCIAL AND ACCOUNTING POLICY - IFRS STANDARDS ............................. | 91 |
7.2 CONSOLIDATED SIMPLIFIED BALANCE SHEET OF EUTELSAT
COMMUNICATIONS ..................................................................................................................... | 91 |
7.3 SIMPLIFIED CONSOLIDATED INCOME STATEMENT OF EUTELSAT
COMMUNICATIONS ..................................................................................................................... | 92 | |
7.3.1 | Analysis of the activity during the year........................................................................ | 92 |
7.3.2 | Operating charges at 30 June 2022 ............................................................................ | 94 |
7.3.3 | Depreciation and amortisation and other operating costs........................................ | 94 |
7.3.4 | Operating income ........................................................................................................... | 95 |
7.3.5 | Financial result................................................................................................................ | 95 |
7.3.6 | Corporate tax .................................................................................................................. | 95 |
7.3.7 | Income from associates ................................................................................................ | 95 |
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7.3.8 | Consolidated net income............................................................................................... | 95 |
7.3.9 Net income attributable to the Group .......................................................................... | 95 | |
7.4 GROUP LIQUIDITY AND FINANCIAL RESOURCES ................................................. | 95 | |
7.4.1 | Status of the Group's net indebtedness...................................................................... | 95 |
7.4.2 Description of the financial instruments in place during the financial year ended
30 June 2022 .................................................................................................................................. | 97 | |
7.5 | FINANCIAL INSTRUMENTS............................................................................................ | 99 |
7.6 | LITIGATION ........................................................................................................................ | 99 |
8 - COMPANY FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 - | ||
FINANCIAL INFORMATION........................................................................................................... | 100 | |
8.1 | ACCOUNTING AND FINANCIAL PRINCIPLES ......................................................... | 100 |
8.2 | COMPANY ACTIVITIES AND KEY HIGHLIGHTS DURING THE YEAR................ | 100 |
8.3 EXTRACTS FROM THE COMPANY'S BALANCE SHEET AND INCOME
STATEMENT AT 30 JUNE 2022 ............................................................................................... | 100 |
8.3.1 Balance sheet at 30 June 2022 - Company financial statements........................ | 100 |
8.3.2 Income statement at 30 June 2022 - Company financial statements ................. | 100 |
9 - FINANCIAL OUTLOOK ............................................................................................................ | 101 |
10 - CORPORATE GOVERNANCE ............................................................................................. | 103 |
10.1 COMPOSITION OF THE BOARD OF DIRECTORS ..................................................... | 103 |
10.1.1 Gender and diversity policy ............................................................................................ | 103 |
10.1.2 Changes in the composition of the Board of Directors............................................... | 103 |
10.2 TOP MANAGEMENT.......................................................................................................... | 115 |
10.2.1 Top management personnel .......................................................................................... | 115 |
10.2.2 Executive Committee....................................................................................................... | 117 |
10.3 CORPORATE GOVERNANCE ......................................................................................... | 117 |
10.3.1 Reference Code used to establish a corporate governance policy.......................... | 117 |
10.3.2 Separation of the functions of Chairman and Chief Executive Officer..................... | 118 |
10.3.3 Organisation of the Board............................................................................................... | 118 |
10.3.4 Independence of the Board of Directors....................................................................... | 118 |
10.3.5 Representation on the Board ......................................................................................... | 119 |
10.3.6 Mission of the Board of Directors .................................................................................. | 120 |
10.3.7 Attendance of the Board Meetings ................................................................................ | 122 |
10.3.8 Committees of the Board of Directors........................................................................... | 123 |
10.3.9 Other Legal Information .................................................................................................. | 126 |
10.4 INFORMATION ON COMPENSATION PAID TO CORPORATE OFFICERS ....... | 127 |
10.4.1 Compensation policy (ex-antevote).............................................................................. | 127 |
10.4.2 Information concerning remuneration in compliance with the Article L. 22-10-34-II | |
of the French Commercial Code (ex-postvote) ...................................................................... | 135 |
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Eutelsat Communications SA published this content on 04 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 October 2022 11:01:05 UTC.