Eutelsat Communications

Welcome to the Eutelsat first quarter 2026-2027 revenues presentation. For the first part of the conference, the participants will be in listen-only mode. During the questions and answers session, participants will be able to ask questions by dialing pound key 5 on their telephone keypad. Now, I will hand the conference over to the speakers, Jean-François Fallacher, Chief Executive Officer, and Sébastien Rouge, Chief Financial Officer. Please go ahead.

Welcome and thank you for joining us today for Utelsat's first quarter 26-27 revenues presentation. I am Jean-François Fallacher, CEO of Utelsat, and I am joined by Sébastien Rouge, our Chief Financial Officer. Let us start with the highlights of the past quarter. Leo revenues continue their solid growth rate, up 30%, driving sustained growth across all our connectivity activities. Overall, our first quarter revenues were in line with expectations, enabling us to confirm our full-year 2026-2027 financial objectives, as well as our long-term targets. Finally, we reached this past quarter a major strategic milestone with the successful completion of the IRI Square first rendezvous. The programme has now entered its construction phase, making the transition from programme definition to industrial execution and enabling us to recognise 8.9 billion of associated backlog. These milestones further cement Eutelsat's role at the heart of Europe's future sovereign connectivity infrastructure. Let me now provide precisely an update on the IRI Square program and on the progress we have achieved over the past month. Last August, the European Commission and the Space Race Consortium officially confirmed the launch of the industrialization phase of the program, moving it from planning into full-scale deployment. At the heart of this ecosystem, Eutelsat will leverage its proven operational expertise, systems engineering capabilities, and unique experience in deploying and operating large-scale constellations to deliver one of Europe's most ambitious space programs. Our role encompasses the design, the deployment, and the operations of the IRE2 LEO constellation, integrated with a broader multi-orbit architecture spanning LEO, MIU, and of course, terrestrial infrastructure. The LEO constellation combines an inclined orbital architecture with beamforming antennas, 5G and TN, and it will dynamically direct capacity to where demand is the greatest, providing higher throughput, improved service quality, and a more efficient use of network resources. Optical inter-satellite links will further enhance resilience, extend service availability and reduce reliance on ground infrastructure, and this will benefit governments, enterprises, mobility and other mission-critical applications. The Constellation will also support a new generation of smaller, lighter and more affordable user terminals, making high-performance satellite connectivity accessible to a broader range of customers. As just said, Eutelsat, as the leader of the LEO segment within the SpaceRise consortium, will design, deploy and operate a constellation of 264 dual MILKA and KU satellites and 66 MILKA satellites providing access to over 2 terabit per second of sellable CLIO commercial capacity by mid-2032, which is more than twice the current one-way capacity. The total program funding stands at €15.6 billion, of which 74% is publicly funded. This is significantly reducing Zeutelsat's capital exposure. Our own capex in this project amounts to 3.4 billion euros and this is split into 2.23 billion euros in the shared infrastructure and a further 1.16 billion euros in the commercial infrastructure which is consisting of Utilsat's own payload. These investments will be deployed from full year 27 to full year 34 and are structured to complement rather than compete with our existing investment program. Importantly, with construction related activities now underway, our backlog will now include 8.9 billion of revenues. These revenues are associated, these future revenues are associated with the execution of the program expected to be recognized mostly between the year 27 and 2031 as construction activities will progress. Finally, ALG Square will effectively become Mutelsat's next-generation LEO infrastructure and will enable us to unlock an estimated €10 billion services revenues between 2032 and 2040. Here you have a look on the roadmap of IRI Square. So with IRI Square, Utelsat has established a clear and visible LEO roadmap until, as you can see here, until 2040. providing both continuity of service for existing customers while progressively delivering greater capacity. This path begins with the renewal in the expansion of the current OneWeb constellation for the deployment of 440 new satellites. That will be complemented by 229 additional satellites. Designed to ensure continuity of service and that progressively will replace satellites reaching the end of their operational life and enhance the network's capabilities that will bring the total constellation to approximately 1,300 satellites over the 2030 horizon. The commercial segment of Iris Square itself is expected to be fully operational by mid-2032 and will progressively take over from the current one-web constellation while providing access to more than twice the current existing capacity and supporting hotelsat's long-term value creation. And with that, let me now hand over to Sébastien Rouge, who will take you through our first quarter performance in more details.

Thank you, Jean-François. Good evening, everyone. Total revenues for the first quarter stood at 286 million euros, down 0.9% on a like-for-like basis. They reflected, and that's a good news, a slight positive currency effect. Revenues of the four operating verticals down 2.1% on a like-for-like basis. And finally, in the context of IRIS Square, 5 million of revenue were recognized during the first quarter from the commencement of construction related activities. This amount represents an initial contribution that is expected to increase materially over the remainder of the fiscal year as execution of the program advances. Let's have a look at the segmental reporting. Video, representing 40% of revenue, stood at 110 million euros, a decline of 17.8%. Fixed connectivity revenues, representing 21% of the group total, decreased by 4.7% to 60 million euros. Government services, 22% of revenues, stood at 60 million euros, a rise of 14.3%. and Mobile Connectivity Revenues representing 17% of the group total stood at 48 million euros, an increase of 38%. Let's start with the details of video. As said above, video revenues amounted to 110 million, down 17.8% year-on-year, reflecting the carry-forward impact of recent contract renewals and capacity optimization initiatives of certain customers. compounded by the termination of capacity contracts on the Express 81 and 82 Russian satellites. On a quarter-on-quarter basis, revenues were down by 12%, notably reflecting the above-mentioned capacity optimization from certain customer impacts. On the commercial front, Utelsat renewed several long-standing partnerships across its video business, including agreements with Record in Brazil, A1 Group in Central and Eastern Europe, and Télédiffusion d'Algérie, supporting the continued distribution of broadcast services across key video neighborhoods. Looking ahead, the pace of decline is expected to moderate as most of the recent headwinds are absorbed and performance progressively realigns with underlying market trends. Let's now take a closer look at connectivity, which now accounts for 60% of Operating Vertical's revenue. First quarter revenues stood at 168 million euros, up 11.9%. They reflected a 30.1% rise in LEO revenues to 70.9 million, underpinned by sustained growth in higher quality service revenues across all three verticals, despite a lower contribution from terminal sales, as well as a 1.6% increase in geo-connectivity revenues to 97.4 million euros. Quarter on quarter, revenues were down by 22.4%. The quarter on quarter decline in connectivity mainly reflects a higher comparison base in Q4-25-26, notably across government services and fixed connectivity, which included catch-up revenues as we announced in the last Q4 release. Let's look at each connectivity vertical in more detail. Q1 fixed connectivity revenues stood at 59.6 million euros, down 4.6% year on year. The decline primarily reflected more challenging market conditions for geo-enabled solutions, as well as a lower contribution from LEO terminal sales. This was partially offset by continued growth in LEO service revenues. On the commercial front, Utelsat continued to expand its connectivity footprint through new agreements across Europe. In Portugal, Utelsat and the country's leading telecommunication operator, Mayo, announced a new partnership to expand the delivery of one-web Leo connectivity services. In Germany, Eutelsat also expanded its geocapacity agreement with Eurosky Park, extending secure satellite connectivity to critical offshore energy infrastructure in the North Sea through the flexible and scalable geocapacity of Eutelsat 10B. These agreements illustrate the growing demand for secure, resilient and diversified connectivity solutions across both enterprise and critical infrastructure markets. Government services revenues stood at 60.3 million, up 14.3% year-on-year. Growth was driven by both GEO and LEO applications, reflecting notably the contribution from the Centaur Call of Contract under the 1 billion Nexus Framework Agreement with the French Ministry of the Armed Forces and Veterans. Services delivered in Ukraine and growing demand for sovereign connectivity service amid a rapidly evolving geopolitical landscape. UTELSAT has announced its participation in the Enhanced Satellite Connectivity Project for Greenland, a new initiative supported by the European Union, the Government of Greenland and the Government of Denmark to extend reliable connectivity to rural and remote communities across the country. Elsewhere, Utelsat and Germany's Aurora Tech, a leader in space-based thermal intelligence, announced a new partnership where Aurora Tech will reserve space aboard Utelsat's future one-web LEO satellite to host 48 thermal infrared payloads with the options for an additional 48. Mobile connectivity revenues stood at 48.3 million, up 38.1% year-on-year. The aerial segment remained the main growth driver, benefiting from the continued expansion of both GEO and LEO connectivity solutions. In maritime, growth was primarily driven by the continued adoption of LEO solutions. Utelsat successfully completed its first rail connectivity trial in Poland aboard a long-distance train conducted on PKP Intercity's live rail network, demonstrating its OneWebLEO capabilities on a live rail network. The trial assessed seamless switching between satellites and terrestrial technologies and highlighted the potential of utelsat's rail connectivity solution to support passenger connectivity, operational communications and data service for both passenger and freight rail operators. Let's go to the backlog now. The backlog stood at 12.1 billion euros as of September 30th, 2026. As Iris Square program entered its construction phase, the backlog now includes revenues associated with the execution of construction-related activities under the program amounting to 8.9 billion euros. Excluding this contribution, the connectivity and video backlogs, now respectively standing at 1.9 and 1.2 billion euros, were slightly lower compared to June 26, reflecting their natural consumption. On this note, let me now hand back to Jean-François, who will conclude with our outlook and perspectives.