ANNUAL
REPORT
2021
SES ANNUAL REPORT 20212
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
CONTENT
1 2 4 5
6
3
OPERATIONAL
& STRATEGIC
REPORT
4 Our company
5 Our equity story
6 Our business model & priorities
7 Business highlights
8 Financial highlights
9 Letter from the Chairman
10 Letter from the Chief Executive
12 Our markets & outlook
15 Our global network
20 SES | Video
23 SES | Networks
26 Financial review & outlook
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
30 Our Horizon Strategy
34 Sustainable Space
37 Climate Action
40 Diversity and Inclusion
46 Critical Human Needs
48 Operating our Business
57 Reporting Standards
Appendix
CONSOLIDATED
FINANCIAL
STATEMENTS
92 Audit report
96 Consolidated income
statement
97 Consolidated statement
of comprehensive income
98 Consolidated statement
of financial position
99 Consolidated statement
of cash flows
100 Consolidated statement
of changes in shareholders’
equity
102 Notes to the consolidated
financial statements
SES S.A.
ANNUAL
ACCOUNTS
160 Audit report
163 Balance sheet
164 Profit and loss account
165 Statement of changes
in shareholders’ equity
166 Notes to the annual
accounts
ADDITIONAL
INFORMATION
180 Financial Calendar
181 Imprint
CORPORATE
GOVERNANCE &
REMUNERATION
CORPORATE GOVERNANCE
60 Shareholder structure
61 Chairman’s report
on Corporate Governance
63 Board of Directors & Committees
70 Senior Leadership Team (SLT)
73 Internal control procedures
78 Principal risks
REMUNERATION REPORT
82 The Remuneration policy
86 Remuneration report
1
4 Our company
5 Our equity story
6 Our business model & priorities
7 Business highlights
8 Financial highlights
9 Letter from the Chairman
10 Letter from the Chief Executive
12 Our markets & outlook
15 Our global network
20 SES | Video
23 SES | Networks
26 Financial review & outlook
OPERATIONAL
& STRATEGIC
REPORT
SES ANNUAL REPORT 20214
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
OUR COMPANY
EMPOWERING BILLIONS OF STORIES
CREATING CHANGE WITH YOU
SES is more than a ‘satellite operator’. We are a leader in global content connectivity solutions
We deliver amazing experiences everywhere on Earth and solutions that matter
DOING THE EXTRAORDINARY IN SPACE
REAL INNOVATION FOR REAL PROGRESS
Our unique and seamlessly integrated multi-orbit network covers 99% of the world’s population
Our next-generation constellation and differentiated offerings will enable a truly connected world
SES ANNUAL REPORT 20215
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
INDUSTRY
LEADER
Over 35 years of success
serving the world’s major
businesses, governments,
and institutions
Track record of sustainable
innovation and being
‘the first’
Rapidly growing demand for
content and connectivity
everywhere
Intelligent multi-orbit global
network and profitable video
neighbourhoods
High EBITDA margins and focus
on managing discretionary costs
Strong, long-term cash flow
generation profile
We enable people to
access media and
entertainment anywhere
We help to connect the
unconnected everywhere
Disciplined growth investment
and low replacement CapEx
needs
Focus on maintaining strong
balance sheet metrics
Substantial monetisation from
US C-band in 2021 and 2023
STRONG GROWTH
OUTLOOK
PROFITABLE
EXECUTION
MAKING A
DIFFERENCE
ATTRACTIVE TOTAL
SHAREHOLDER RETURN
OUR EQUITY
STORY
€1.8B +10% ~60% >1B GROWTH
>355M >99% €5.2B 11 of 17 €0.50
2021 group
revenue
CAGR
1
expected industry growth,
2021–2030
Adjusted
EBITDA margin
people rely on SES
everyday
in EBITDA and
Free Cash Flow from 2023
TV homes
served by SES
of land, sea and air
covered by SES
2021 fully protected
contract backlog
UN SDGs supported
by what we do
2021 proposed
dividend per A-share
1 Source: Northern Sky Research (June 2021)
1 2 3 4 5
SES ANNUAL REPORT 20216
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
OUR BUSINESS
MODEL & PRIORITIES
BOLD PURPOSE COMPELLING CAPABILITIES CLEAR PRIORITIES STRONG VALUE CREATION
We do the EXTRAORDINARY in space
to deliver AMAZING experiences
EVERYWHERE on Earth.
We benefit from two market- leading
businesses and strong common
fundamental capabilities.
We aim to deliver a profitable and
growing business that makes a
positive contribution to all.
We aim to deliver compelling value
for all stakeholders and make a
difference on Earth.
WE SEE SIGNIFICANT DEMAND for content
connectivity solutions around the world, where
the satellite – and SES – will play amajor role.
WE WANT TO HARNESS THE POWER
OF SPACE to help connect more people in
more places with content that educates and
entertains, protects populations, drives business
forward, enriches lives, and empowers personal
stories.
WE AIM TO ENABLE OUR CUSTOMERS to
solve critical connectivity challenges and deliver
media experiences using our unique, global,
space-based infrastructure.
UNPARALLELED REACH underpinning large,
profitable, and resilient Video neighbourhoods.
UNIQUE MULTI-ORBIT NETWORK offering
compelling scale, flexibility, and performance.
ACCESS TO GLOBAL SPECTRUM with
priority access to equatorial MEO spectrum.
OPEN INNOVATION APPROACH with
partners to drive productivity, flexibility, and
reduce cost.
DISCIPLINED FINANCIAL POLICY built on
strong balance sheet metrics and cash flow
generation.
DIVERSE AND TALENTED ORGANISATION
with people who are experts in their fields.
LEVERAGE AND SCALE OUR UNIQUE
INFRASTRUCTURE to reinforce our prime
video neighbourhoods and profitably scale our
intelligent, multi-orbit network in high value
segments.
DELIVER SOLUTIONS THAT DRIVE OUR
CUSTOMERS’ SUCCESS with products and
services that enable them to grow sales, reduce
cost, and/or make a positive impact.
MAKE SATELLITE MAINSTREAM through
seamless integration of satellite within the
broader global network ecosystem, including
enabling cloud adoption on a global scale.
PURPOSE-DRIVEN ORGANISATION AND
CULTURE focused on profitable execution,
sustainable innovation, and leaving SES – and
the World – in a better place.
CUSTOMERS: our customers are part of our
family and their success is also our success.
EMPLOYEES: we want to unleash the full
potential and passion of the entire SES family,
making SES a great place to work.
SHAREHOLDERS: we strive to deliver an
attractive combination of sustained capital
growth and income return for shareholders.
SOCIETY: we want to raise up the human
experience, ensure that everyone is connected
to the world’s content, and use our business to
make a difference.
1 2 3 4
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES ANNUAL REPORT 20217
2021
BUSINESS
HIGHLIGHTS
ANOTHER YEAR OF
STRONG EXECUTION
FIRST $BILLION EARNED
FROM C-BAND IN THE US
$900M+ BACKLOG SIGNED
FOR SES-17/O3B MPOWER
€275M RETURNED TO
SHAREHOLDERS IN 2021
2021 revenue and adjusted EBITDA
were both delivered in line with our
financial outlook
In 2021, we completed the first
of two phases of clearing
US C-band spectrum to
facilitate 5G deployment
Underpinning our expectation
of growing Revenue, Adjusted
EBITDA, and Free Cash Flow
from 2023 onwards
Through maintaining our
dividend commitment and
completion of a share
buyback programme
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES ANNUAL REPORT 20218
2021
FINANCIAL
HIGHLIGHTS
€1,782M 2.9 TIMES€1,091M €323M
Group revenue
2020:
€1,876M
Ratio of Adjusted Net Debt
to Adjusted EBITDA
2020:
3.0 times
Adjusted EBITDA
2020:
€1,152M
Adjusted Net Profit
2020:
€191M
SES ANNUAL REPORT 20219
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
broadcasters, platform operators, and content owners – in the size-
able, long-term financial commitments they are making to SES.
Since 2017, our Networks business has grown by almost 30% and now
represents 41% of total revenue. Given the challenges that the global
pandemic continues to present to our customers and their businesses
in our main growth segments, SES’ ability to maintain revenue year-
on-year was a commendable outcome and reflective of our unique
value proposition for major commercial, government, and institutional
clients – a value that will ensure our Networks business returns to
growth in 2022 and beyond.
2021 marked a major landmark in our US C-band repurposing effort
with the completion of phase one and the receipt of almost $1 billion
in cash payments. These proceeds will be fully used to strengthen
the balance sheet given the important year of growth investment
ahead with SES-17 and the first O3b mPOWER satellites. Our fully
dedicated C-band team is now focused on phase two and is working
with our customers and partners to deliver on the timelines laid down
by the FCC. We are on track to complete this work towards the end
of 2023 and to receive the full $3 billion from the second phase of
incentive payments, which the Board intends to utilise in the most
optimal way for the benefit of shareholders.
In keeping with the Board’s commitment to shareholder return, the
company returned €275 million to shareholders in 2021, including a
share buyback programme of €94 million that underscores the Board’s
confidence in the long-term fundamentals of the business and the
view that our market valuation does not reflect the underlying value
of the company.
The Board is proposing a 2021 dividend of €0.50 per A-share to be
approved at our Annual General Meeting on 7 April 2022. This pro-
posed dividend would represent an increase of 25% in the minimum
base dividend reflecting the strong cash-generating profile of the
business and consistent with the policy of maintaining a stable to
progressive dividend policy.
In last year’s Annual Report, I discussed the Board’s firm commitment
to our Environmental, Social, and Governance (ESG) agenda, with SES
possessing both the tools and the conviction to help making the world
a better place for all. I am delighted to share our ambitious ESG strat-
egy, focused on four key pillars – ensuring the secure and sustainable
use of space; bold climate action, including a commitment to carbon
NetZero by no later than 2050; increasing diversity and inclusion in
the industry, starting with SES; and using our global content and con-
nectivity solutions to meet critical human needs.
Our purpose at SES – to do the extraordinary in space to deliver amaz-
ing experiences everywhere on Earth – is inspiring, compelling, and
a main reason to be with SES on this journey for myself and the rest
of the SES Board of Directors.
Looking forward, our company is incredibly well positioned to push
ahead as the industry leader, profitably grow the business, create
long-term shareholder value, and make a meaningful contribution to
the lives of people and communities all over the globe.
Finally, I would like to take this opportunity to welcome our new Board
member, Jacques Thill, and to also thank our out-going members –
Tsega Gebreyes, Serge Allegrezza, and Paul Konsbruck who step
down from the Board – for their immeasurable contribution to our
company.
Frank Esser
Chairman of the SES Board of Directors
Frank Esser
Chairman of the
SES Board of Directors
Against the backdrop of the exceptional circumstances caused by
the COVID-19 global pandemic, I am delighted to report that our com-
pany has delivered another strong commercial and financial perfor-
mance in 2021 and, on behalf of the entire SES Board of Directors,
would like to thank everyone at SES for their commitment, persever-
ance, and dedication.
Group revenue and Adjusted EBITDA were both firmly in line with our
objectives, Adjusted Net Profit substantially up from last year, while
leverage is at the lowest level for six years. In addition, SES recorded
almost $1 billion income from the successfully completed first phase
of accelerated C-band clearing, and increased the revenue backlog
associated with our future growth investments to over $900 million.
Every day, over a billion people across the world rely on SES for their
video programming and our video business, representing 59% of total
revenue, delivered an improving performance trajectory this year. The
unparalleled reach of our prime video neighbourhoods is consistently
recognised and appreciated by our customers – the world’s leading
LETTER FROM THE
CHAIRMAN
SES ANNUAL REPORT 202110
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
IMPORTANT PROGRESS TOWARDS DELIVERING
PROFITABLE, LONG-TERM GROWTH
Our business requires long-term investments necessitating substan-
tial upfront capital and relatively long lead times as satellites are man-
ufactured, launched and brought into service before revenues can be
generated, with returns then delivered through the operation of the
satellites over more than a decade.
Since our last satellite launch in the middle of 2018, we have been
investing in the ongoing growth in our networks business, specifically
in the development of SES-17, a state-of-the-art high throughput sat-
ellite (HTS) for the Americas, and O3b mPOWER, the follow-on to our
highly successful Medium Earth Orbit constellation, O3b. Together,
these assets will not only form the bedrock of our seamlessly inter-
operable, intelligent, and cloud-enabled network of the future, but will
be a key driver of revenue, EBITDA, and free cash flow growth start-
ing in 2023.
Following a successful launch in November 2021, SES-17 is already
well on its way to orbit and will start serving customers, including the
Thales Avionics as the anchor client, from the middle of 2022. SES-17
will be joined in space by the first six satellites for the O3b mPOWER
constellation from the middle of 2022 with start of commercial service
slated for the end of 2022.
We have signed agreements totalling over $900 million in gross back-
log, up by 60% from the end of 2020, underscoring the considerable
customer interest in the high throughput, high flexibility services that
these investments will deliver and I expect this backlog to continue
to growth as we approach the start of service.
STRONG PERFORMANCE IN 2021
After a year like no other in 2020, the challenges induced by the
COVID-19 global pandemic remained ever-present in 2021 for our
business, our customers, and our employees. I am tremendously proud
of the way the entire SES community stepped up to support our cus-
tomers, enhance our reputation for exceptional products and services,
and once again deliver a strong operational and financial performance.
For the year ended 31 December 2021, we generated €1.8 billion of
revenue and €1.1 billion of Adjusted EBITDA while our laser-focus on
all the cost lines resulted in a 69% year-on-year growth in Adjusted
Net Profit.
We signed more than €1.2 billion in customer deals during the year
from the combination of renewals and new business wins which
demonstrated the commercial appeal of our prime video neighbour-
hoods, unique multi-orbit network offering, and value-added products
and services.
After two years of expected higher-than-normal declines in our video
business, I am pleased to report that we now seeing the evidence
of the curve flattening with an excellent revenue outturn of over
€1.0 billion which exceeded our expectations for the year. The lasting
value of our video business lies in the reach of our core neighbour-
hoods, serving over 355 million TV households every day, borne out
by the important contract extensions that we secured with our key
customers throughout the year.
Satellite is by far the most reliable and cost-effective means of dis-
tributing quality content in High Definition and Ultra High Definition,
and this is reflected in the 6% year-on-year growth to more than 3,100
total HD TV channels carried across the SES network, more than any
other satellite operator.
2021 was also a successful year HD+, our consumer business in Ger-
many, where we grew revenue, implemented a price increase,
increased the average number of paying subscribers, and made the
platform truly hybrid by adding to the overall offering with the intro-
duction of HD+ ToGo and HD+ IP, products that will continue to grow
our B2C reach.
On the Networks side, the extended COVID environment continued to
impact our customers and dampen growth, notably in the commercial
aviation and cruise segments. Notwithstanding this, the strength of our
unique multi-orbit (MEO-GEO) capability ensured that we were able to
deliver €735 million in revenue for the year, the same level as a year
ago with some growth evident in the second half. In our high value gov-
ernment segment, we secured important commercial wins to support
communications and morale, welfare, and recreation missions aboard
large naval vessels, as well as other government agencies and institu-
tional clients. Meanwhile, our Fixed Data continued to secure new busi-
ness with major telcos, mobile network operators, and cloud partners.
Steve Collar
Chief Executive Officer
LETTER FROM THE
CHIEF EXECUTIVE
SES ANNUAL REPORT 202111
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
UNLOCKING SUBSTANTIAL VALUE FROM
CLEARING US C-BAND FOR 5G
After a considerable effort on the part of our dedicated C-band team,
as well as the supporting colleagues, partners, and providers, we were
delighted to receive confirmation from the FCC of our successful
clearing of the first 120 MHz of US C-band spectrum in advance of
the 5 December 2021 deadline, paving the way for the 5G deployment
in the US and the payment of our first accelerated relocation payment,
totalling almost $1 billion, which we received between late December
2021 and early January 2022.
The SES team is now fully focused on the clearing of the full 280 MHz
of spectrum for 5G ahead of the 5 December 2023 clearing deadline
and this phase two clearing remains fully on track. In doing so, we will
earn the second accelerated relocation payment of almost $3 billion
while also ensuring a smooth transition for our video customers, who
will continue to rely on the upper portion of the C-band spectrum for
the delivery of critical broadcast services to some 120 million house-
holds across the US.
DRIVING LONG-TERM SHAREHOLDER VALUE
Exponentially growing demand for global content and connectivity
solutions is set to propel our industry forward over the course of the
decade, and we are positioning SES to retain the leadership standing
that the company has enjoyed for over 35 years.
Having executed well in 2021 and delivered an excellent set of results,
in 2022 we will continue to leverage the strength of our video neigh-
bourhoods through an improving revenue trend while networks will
grow on the back of momentum in government and mobility, buoyed
by the activation of SES-17 and ahead of the introduction of O3b
mPOWER.
Beyond 2022 we will see top line and EBITDA expansion driven by
our growth investments while beyond our investment peak we will be
in a substantially lower CapEx environment, generating strong cash
flows on a sustaining basis and augmented by $3 billion dollars in
C-band proceeds in late 2023. All of this will drive substantial value
for SES and our shareholders.
The strategic importance of space has never been clearer, reflected
in the announcement by the European Commission of a secure and
sovereign multi-orbit space architecture for the benefit of Europe and
its citizens, an initiative that is consistent with our architecture, our
capabilities, and our vision as the world’s largest satellite operator.
Finally, we have laid out a bold ESG agenda focusing on four key areas
of upmost importance to SES – Sustainable Space, Climate Action,
Diversity & Inclusion, and the empowering of communities through
the focus on Critical Human Needs.
To sum up, we are executing strongly in the core of our business,
bringing highly innovative and differentiated assets to market at the
right time to drive growth, we have one of the strongest balance
sheets in the industry, and have laid out a bold and exciting vision for
the future of SES and for the industry.
Steve Collar
Chief Executive Officer
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES ANNUAL REPORT 202112
OUR
MARKETS &
OUTLOOK
$30B 4x GROWTH +10% ~$50B
expected annual satellite
industry revenue by 2030
1
expansion in annual satellite
industry networks revenue
between 2021 and 2030
1
CAGR expected growth in annual
satellite industry revenue
from 2021 to 2030
1
of cumulative satellite
industry video revenue
from 2021 to 2030
1
1 Source: Northern Sky Research (June 2021)
SES ANNUAL REPORT 202113
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
VIDEO BROADCASTING
MARKET TRENDS &
INDUSTRY OUTLOOK
Broadcast and video contribution services have been the bedrock of
satellite industry revenue for decades. Satellite represents the most
reliable and cost-effective platform for the delivery of linear TV con-
tent which represents a significant source of income for the world’s
broadcasters, free-to-air platforms, pay-TV platforms, and content
owners. By 2025, global linear TV revenue (public TV, pay TV, and
advertising) is expected to reach over $400 billion (source: OMDIA,
December 2021).
While the globalisation of content, direct-to-consumer offerings by
the major brands and the general uptake of on-demand video con-
sumption is shifting the industry’s focus from linear to Over-the-Top
(OTT), linear broadcast TV remains the most important and profita-
ble revenue source for broadcasters.
The strategic importance of satellite to broadcast stems from its abil
-
ity to overcome the lack of ubiquitous broadband coverage – or its
uneven distribution, deliver shared viewing experiences, and cater to
the need for public and independent programming.
Especially in emerging markets, the favourable economics of broad-
cast, combined with more efficient compression technologies, posi-
tion satellite well to capture content-hungry consumer markets with
increasing spending power where terrestrial network expansion is
lagging.
At the same time, increased penetration of High Definition (HD) and
Ultra HD (UHD) TV sets drives consumer demand for additional HD
and UHD content. From 2021 to 2026, the number of HD or UHD TV
sets installed will grow by 21% to over 1.8 billion (source: Dataxis,
December 2021).
Global TV channels
THOUSANDS OF CHANNELS
SD HD UHD Source: Euroconsult (October 2021)
To feed this demand, the number of HD TV channels broadcast via
satellite is forecast to grow by 72% to over 24,000 by 2030 while the
number of UHD TV channels is predicted to grow from 150 in 2021 to
over 800 UHD TV channels in 2030 (source: Euroconsult, October
2021), each more satellite bandwidth than Standard Definition (SD)
TV channels to broadcast reliably.
Overall, the number of satellite-delivered TV channels is forecast to
decline reflecting changing consumer behaviour that now expect any-
where, anytime, on-any-device reception of video content, leading to
fewer standard definition simulcast channels and/or niche content
which is migrated online.
To cater to these trends, broadcasters and content owners are chang-
ing their business models to hybrid (linear and on-demand) offerings,
as well as looking to source solutions, such as cloud playout, that
improve operational efficiency and reduce business costs.
Linear TV programming remains key
to customer success
Consumer demand for more HD and UHD
content is expanding
Globalisation of Video content and
growing demand for new TV content
across emerging markets
Changing media consumption patterns
will reduce total number of satellite TV channels
Terrestrial networks expanding
broadband coverage in urban areas
Broadcasters’ business models evolving
2029202820272026202520242023202220212020
45
30
15
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SES ANNUAL REPORT 202114
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NETWORK CONNECTIVITY
MARKET TRENDS &
INDUSTRY OUTLOOK
According to Northern Sky Research (NSR), annual networks indus-
try revenue will grow by 3-4 times to $22 billion by 2029 as satellite
plays a major role in supporting requirements for universal broadband
access, mobile connectivity (commercial and government), and Intel-
ligence, Reconnaissance and Surveillance (ISR) needs.
Global Networks Satellite Capacity Revenue
$ BILLION
Enterprise Mobility Government Broadband Access
Source: Northern Sky Research (June 2021)
Fulfilling the global ambition for universal broadband access repre-
sents a substantial opportunity for satellite. There are billions of people
today still not connected to the internet, many of whom live and work
beyond the reach of terrestrial networks.
At the same time, Telecom companies (telcos) and Mobile Network
Operators (MNOs) are looking to satellite to extend their network
reach through the rollout of 3G, 4G and 5G cellular backhaul as well
as community WiFi services. The number of cellular backhaul sites
served by satellite is projected to increase by 6% per annum to over
60,000 in 2029, mostly driven by 3G and 4G network expansion
(source: Euroconsult, July 2021).
In aviation and maritime segments, Euroconsult estimates that around
more than 200,000 vessels and airplanes are operating beyond the
reach of terrestrial networks and will require satellite links for contin-
uous broadband connectivity, ranging from small amounts of mega-
bits/second to hundreds of megabits/second … and even gigabits/
second in the future (source: Euroconsult, July 2021).
Demand for ISR solutions is also on the rise with governments around
the world seeking to deploy more unmanned vehicles with more capabil-
ities, and therefore requiring more bandwidth, for a range of defence-
and civilian-related applications. By 2030, each unmanned aerial
vehicle (UAV) will require an average of approximately 140 megabits/
second of connectivity (source: Euroconsult, July 2021).
For all these demand areas (universal broadband, mobility and ISR),
the adoption of cloud computing brings multiple commercial benefits
including improved productivity and efficiency, reducing operating
costs, as well as bringing new business opportunities. In June 2021,
NSR predicted that nearly 72 Exabytes (or 7.2 billion Gigabytes) in
cloud data traffic will be delivered via satellite by 2030.
High Throughput Satellite (HTS) systems are highly suitable for most
networks applications, offering higher data rates and lower cost of
capacity (relative to traditional wide-beam satellites), driving expan-
sion of the addressable market.
While lower latency capabilities offered by Non-Geostationary Satel-
lite Orbit (NGSO) systems are attractive for time-sensitive applica-
tions, like voice backhaul and live gaming, NGSO requires more sat-
ellites as well as more complex and expensive ground infrastructure
compared to GEO HTS.
In the coming years, new HTS capacity is expected to be brought to
the market to serve the substantial and growing demand for connec-
tivity. In addition to GEO HTS, new offerings are expected to come
from our own Medium Earth Orbit (MEO), O3b mPOWER, constella-
tion as well as from new entrants launching Low Earth Orbit (LEO)
systems to serve a variety of different target markets and applications.
Exponentially growing demand for
reliable, high-quality connectivity
anywhere and anytime
Increasing adoption of Cloud- and
Telecom-inspired applications and
approaches
High throughput satellite capabilities
expanding addressable market
while supporting economics
Competition new entrants is increasing
Customer and end-user requirements
and service expectations evolving
and expanding
Seamless integration between satellite and
terrestrial networks is becoming essential
20302029202820272026202520242023202220212020
0
5
10
15
20
25
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1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES ANNUAL REPORT 202115
OUR
GLOBAL
NETWORK
ONLY 70+ 9 $4B
Multi-orbit (MEO-GEO)
satellite network operator
satellites operating
across the SES global fleet
next-generation O3b mPOWER
satellites expected to be launched
in 2022
in payments which SES will be
eligible to receive by clearing
US C-band spectrum by end-2023
SES ANNUAL REPORT 202116
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES Fleet in Multiple Orbits as of December 2021
Geostationary Orbit (36,000 km from Earth) Medium Earth Orbit (8,000 km from Earth)
UNIQUE MULTI-ORBIT SATELLITE NETWORK
Satellite offers communication without limits. From space, satellite-
based services can provide connections almost immediately and
virtually anywhere – on land, at sea, and in the air – without the need
for substantial and highly costly infrastructure.
As the leader in global content connectivity solutions, we leverage a
vast and intelligent network that spans satellite and ground infra-
structure, connecting more people in more places.
Our space segment operates within Geostationary Earth Orbit (GEO)
and Medium Earth Orbit (MEO). This provides a unique combination
of truly global coverage and high throughput, low latency capabilities.
Today, our SES GEO fleet comprises over 50 satellites operating with
a combination of C , Ku , Ka , and X band frequencies. The majority have
‘wide beam’ payloads where a small number of beams are used to
cover a large geographic area.
Three of our satellites (SES-12, SES-14, and SES-15) have a hybrid
combination of wide beam and high throughput payloads which carry
many smaller beams capable of deploying more bandwidth and
throughput to a defined area.
In October 2021, SES-17 was successfully launched on board an Ari-
ane 5 launcher, operated by Arianespace. The satellite has a Ka-band
high throughput payload and is expected to begin delivering services
for customers in the Americas, the Caribbean and over the Atlantic
Ocean from the second half of 2022.
SES operates O3b, a constellation of 20 high throughput Ka band sat-
ellites in MEO equatorial orbit. The key advantages of O3b are the
capability to scale capacity globally by simply adding more satellites
into the MEO orbit, and the ability to serve applications that require
low latency which cannot be served by GEO.
Additionally, we have five satellites
flying secondary missions:
ASTRA 1G*, ASTRA 2A*,
ASTRA 2C*, ASTRA 2D*, ASTRA 3A*
177ºW
139ºW
135ºW
131ºW
129ºW
125ºW
105ºW
103ºW
101ºW
87ºW
83ºW
77ºW
72ºW
67ºW
47.5ºW
40.5ºW
37.5ºW
22ºW
20ºW
5ºE
19.2ºE
23.5ºE
28.2ºE
31.5ºE
52.5ºE
57ºE
95ºE
108.2ºE
176ºE
21.5ºE
169.5ºW
0°
ASTRA 3B
SES-5
ASTRA 4A
ASTRA 2E, 2F, 2G
ASTRA 5B
YahLive
NSS-12
SES-8, SES-12
SES-7, SES-9
GovSat-1
ASTRA
1KR, 1L
1M, 1N
AMC-21
SES-15, Ciel2
AMC-1*, AMC-11
AMC-4*, AMC-8*
AMC-6
NSS-9 NSS-11NSS-6*
AMC-15, SES-11
SES-1
SES-3
SES-2
QS-1
AMC-3*
(SES-17), SES-10
AMC-18
SES-14
SES-6
NSS-10*
SES-4
NSS-7*
SES-18, SES-19, SES-20, SES-21, SES-22,
SES-23, ASTRA 1P, ASTRA 1Q
mPower (F01 – F11)
In-Orbit MEO
In-Orbit GEO
Future Launch
orbit raising or drifting
to indicated slot
( )
Inclined GEO *
SES ANNUAL REPORT 202117
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
GLOBAL GROUND NETWORK FOOTPRINT
Our ground infrastructure ensures that customers can gain access to
our satellite fleet and capacity from anywhere in the world. To do this,
SES combines global network with local presence.
This is done by either 30 SES owned or partner teleports, a com-
prehensive fibre-based terrestrial network, and numerous points of
presence (POP).
We bring satellite connectivity to the customer by providing seamless
access to the satellite fleet and the extensive fibre-based network
transports content from any city in the world to any other place in the
world via one of SES owned or partner teleports and the six main
SES POPs.
Controlling satellites is not a fully automated effort. Our Satellite Oper-
ations Centres (SOCs) receive up to 25,000 telemetry parameters per
satellite in real time, including the necessary data to determine each
spacecraft’s position.
Our Network Operation Centres (NOCs) monitor and control all trans-
missions on the SES network, ensuring that they all perform within
tight specifications to maximise the quality and availability of our cus-
tomers’ services.
SES Ground Network
AS OF DECEMBER 2021
20x O3b satellites
11x O3b mP OWER satellites
Complete GEO Coverage
Complete GEO Coverage
50°N
50°S
MEO Standard Service
(
s
)
±50° Latitude
50°N
50°S
MEO Standard Service
(
s
)
±50° Latitude
NSS-6
169.5°W
AMC-8
135°W
AMC -11
131°W
AMC -1
SES -15
Ciel-2
129°W
AMC-21
125°W
AMC -15
SES-11
105°W
SES-3
103°W
NSS-11
176°E
NSS-9
177°W
SES -1
101°W
SES-2
87°W
AMC-2
AMC -16
85°W
QuetzSat-1
77°W
AMC-3
72°W
SES-10
67°W
SES -17
67.1 °W
SES -14
47. 5° W
SES-6
40.5°W
NSS-10
37.5°W
SES-4
22°W
NS S-7
20°W
ASTRA 4A
SES-5
5°E
ASTRA 1KR
ASTRA 1N
ASTRA 1M
ASTRA 1L
19.2°E
*GovS at-1
21.5°E
ASTRA 3B
23.5°E
ASTRA 5B
31.5°E
NSS-5
50.5°E
NSS-12
57°E
SES -12
SES-8
95°E
**SES-9
SE S-7
108.2°E
ASTRA 2E
ASTRA 2G
ASTRA 2F
28.2°E
28.5°E
MonacoSAT
YahSat 1A
52°E
52.5°E
AMC -18
83°W
AMC-6
139°W
In orbit
SES SATELLITE FLEET SES NETWORK
Future HTS satellite
(High-throughput satellite)
In orbit HTS satellite
(High-throughput satellite)
GEO gateway
Inclined
MEO gateway
Point of presence (POP)
Existing link
Future link
Abu Dhabi
Middle East
Hong Kong
Kowloon
Hong Kong
Stanley
Djibouti
Betzdorf
Bucharest
Munich
Madrid
Stockholm
Kiev
Riga
Brewster
LA
Steele Valley
WDC
Woodbine
WDC
Manassas
LA
South Mountain
Hawaii
Sunset Beach
Hawaii
Kapolei
AthensMilan
Paris
Perth
Miami
WDC
NYC
London
São Paulo
Hong Kong
Frankfurt
Dallas
LA
Adelaide
Sydney
Kuala Lumpur Singapore
Accra
Lurin
Lagos
Karachi
Nemea
Sintra
Vernon
Dubbo
Hortolândia
SES ANNUAL REPORT 202118
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
ACCELERATING PROFITABLE GROWTH
WITH THE NETWORK OF THE FUTURE
SES-17: DEPLOYING OUR MOST ADVANCED AND
FLEXIBLE GEOSTATIONARY SATELLITE
Built by Thales Alenia Space and successfully launched by Ariane-
space on 23 October 2021, SES-17 will deliver broadband connectivity
over the Americas, the Caribbean, and Atlantic Ocean.
Thales Avionics is SES-17’s anchor customer and will use the satellite
to deliver unrivalled connectivity for commercial aviation clients over
North America.
SES-17 is a Ka-band High Throughput System (HTS) Geostationary
Earth Orbit (GEO) satellite and the first of its kind, having been engi-
neered to give our customers high-speed broadband and more flex-
ibility, wherever they are located – at sea, in the air or on land.
The satellite features almost 200 spot beams, the power of which can
be dynamically adjusted in step with our customers’ changing require-
ments. It is also our first satellite to have a totally digital payload, pow-
ered by an advanced digital transparent processor (DTP), enabling
far greater flexibility and efficiency.
O3B MPOWER: SCALING OUR UNIQUE AND
PROVEN MEDIUM EARTH ORBIT CONSTELLATION
Starting in 2022, we will be launching the first satellites for our O3b
mPOWER network.
Building on the proven commercial success of our first-generation
MEO constellation, O3b mPOWER provides unprecedented flexibility,
performance, and scale to extend new, bandwidth-intensive network
services and applications – and exponentially more opportunities.
O3b mPOWER is a terabit-level system enabling high performance
services that scale to multiple gigabits per second per connection
virtually anywhere on the globe.
O3b mPOWER delivers flexible service models by dynamically con-
trolling power levels, throughput, and frequency allocation to reliably
meet robust service level agreements.
O3b mPOWER has been engineered with end-user performance
requirements as the leading driver and can support a wide range of
latency-sensitive services and cloud-based business applications.
In combination with SES-17, O3b mPOWER will form the bedrock of
our Network of Future – a vision of a seamless, intelligent, and
cloud-enabled satellite-based infrastructure.
This network will strengthen our unique capabilities to deliver flexible
and reliable, high performance connectivity solutions anywhere on
land, at sea, and in the air.
REALISING OUR VISION OF A SEAMLESS AND
INTEROPERABLE MULIT-ORBIT NETWORK
Both SES-17 and the O3b mPOWER constellation will leverage our
Adaptive Resource Controller (ARC), a software solution that serves
as the brain for the network, which will enable dynamic and automatic
traffic allocation in real-time, as well as orbit switching for complete
and seamless interoperability between MEO and GEO.
We are also working with various technology partners to roll out
next-generation terminals to optimise bandwidth efficiently and
dynamically across the two orbits.
In November 2021, SES and Isotropic completed the first ever simul-
taneous multi-orbit antenna field tests. This industry breakthrough
enables satellite end-users to combine the best attributes of all avail-
able networks to achieve superior network uptime and application
performance.
The Isotropic solution will multiply the performance of single antenna
solutions to transform the global appeal of satellite connectivity,
ensuring critical defence communications infrastructure and deliver-
ing multiple broadband that are highly reliable.
TWO STATE-OF-THE-ART SATELLITES FOR
OUR PRIME TV NEIGHBOURHOOD
In November 2021, SES ordered two geostationary Ku-band satellites
from Thales Alenia Space for its prime orbital slot at 19.2 degrees East
to maintain the premium services it provides to its European video
customers and to capture new opportunities in the region.
These two replacement satellites (ASTRA 1P and ASTRA 1Q) are
expected to launch in 2024 to replace the four satellites (ASTRA 1KR,
ASTRA 1L, ASTRA 1M, and ASTRA 1N) that are currently serving cus-
tomers at this orbital location.
ASTRA 1P, a classic wide-beam satellite, will support our prime TV
neighbourhood and enable content owners, private and public broad-
casters across Germany, France, and Spain to broadcast TV channels
in the highest quality and most cost-efficient manner.
ASTRA 1Q, a next-generation digital satellite with both wide beams
and high throughput spot beams, will not only be able to support
direct-to-home operations but will also be customisable on orbit and
could be deployed easily to other orbital positions to serve the
dynamic needs of both video and data customers into the future.
SES ANNUAL REPORT 202119
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
CREATING VALUE FROM THE CLEARING OF
C-BAND SPECTRUM IN THE US
The U.S. Federal Communications Commission (FCC) has carefully
developed a plan to clear 280 MHz of C-band spectrum (plus a
20-MHz guard band) for 5G mobile services in the contiguous United
States (CONUS) as early as December 2023, with a portion of that
spectrum becoming available as early as December 2021.
The C-band is currently used by satellite operators serving U.S. broad-
casters and programmers to provide TV and radio to nearly 120 mil-
lion homes, as well as other critical data transmission services.
The FCC’s balanced approach will ensure that C-band spectrum is
available quickly without disrupting critical video and audio services.
To deliver on the clearing milestones set out in the FCC’s Order, we
have procured four satellites (plus two spares) and will be launching
them to provide necessary capacity for our existing customers and
begin filtering tens of thousands of earth station antennas through-
out the United States to prevent interference from new 5G services.
To execute the clearing will require an investment of approximately $1.6
billion, of which approximately $1.5 billion is expected to be reimbursed.
PHASE I CLEARING COMPLETED
With the help of trusted partners across the U.S., we completed all
necessary Phase I clearing and relocation activities in advance of the
5 December 2021 deadline.
These activities included relocating all its existing services that are
received by Incumbent Earth Stations (IES) out of the 3700-3820
MHz band exclusively in the contiguous United States and making
necessary equipment changes on all associated IESs. Accordingly, we
have now received the Phase I accelerated relocation payment of $977
million as set out in the FCC final Report and Order.
With the completion of Phase I, we are now fully focused on complet-
ing our Phase II transition activities in advance of the December 5,
2023 clearing deadline. Successfully completing the Phase II activities
by that deadline would allow us to become eligible for a further accel-
erated relocation payment of almost $3 billion.
PHASE II CLEARING ON TRACK
We have contracted with Boeing and Northrop Grumman to manu-
facture four satellites that will be launched during 2022. These four
satellites will carry services that must be transitioned to clear the
lower 300 MHz of C-band spectrum and mitigate the risk of an in-or-
bit failure. We also contracted with Thales Alenia Space to manufac-
ture two ground spares necessary to ensure we can meet our clearing
obligations in the event one or more of the first four satellites expe-
rience a launch or technical issue that makes them inoperable.
At this time, we have completed approximately 30% of the Phase II
satellite transitions, which include broadcast TV, cable network ser-
vices, and other services received in the 3820-4000 MHz range.
Our installers have completed the installation of blue bandpass filters
at approximately 30% of the incumbent earth station (IES) locations
associated with SES satellites and we have installed approximately
10% of the antennas associated with our Phase II transition schedule.
All SES-associated IESs designated to receive compression equip-
ment have received their equipment, including IESs receiving services
between 3820-4000 MHz. All compressed services were transitioned
by 31 October 2021.
Filter installation can only occur after all the services received by the
IES in the filter range (3700-3980 MHz for blue filters) have been fully
transitioned on the satellite. In some cases, we installed filters for IESs
subject to Phase II during our Phase I activities because they were
already operating above 4000 MHz or it would reduce the impact on
the IES operator.
The US C-Band transition is complex and well underway
SEAMLESS CONTINUATION
AND PROTECTION OF EXISTING
TV AND RADIO SERVICES
delivered via C-band to nearly
120 million homes
PREPARATION
P
LANNING
ONGOING ACTIVITY
S
ATELLITES
File plan with FCC
Partnering with industry groups to understand
their questions and share best practices
Outreach to ensure all Incumbent Earth Stations
accessing SES satellites have been accounted for
File updated Phase I plans with the FCC
Manufacture the satellites
Launch the satellites
Complete testing
SES will establish the platform
necessary to transition services –
including TV and radio distribution
and data network ecosystems –
safely and seamlessly.
Per the Report & Order and customer
discussions, SES will ensure the relevant
customers’ ground stations are correctly
pointed and tuned, have upgraded tech-
nology where required, and have filters
installed to protect customers against
interference from new 5G services.
SES will finalize the plans to
transition approximately 200 services
from 500 to 200 MHz of C-band
spectrum and work directly with
the clearinghouse and relocation
coordinator throughout the process.
SES will launch four new
satellites to guarantee suicient
capacity for current customers
and ensure the continuity and
quality of existing services.
ROLLOUT OF 5G in 46 top
U.S. markets as early
as December 2021 and to all
Americans in continental
U.S. by December 2023
Set up a database to ensure eicient
roll-out and accurate accounting
Hire U.S. companies to
launch satellites
Hire U.S. companies to build Gateway
and TT&C Systems
Hire U.S. companies to build satellites
necessary to transition customers
Hire U.S. companies to help
install/retune ground equipment
Install antennas and satellite ground control
equipment at TT&C locations to ensure
continued safe satellite operations
Consolidate Phase II gateway services to
allow ongoing receipt of international video
content and to support valuable data services
Consolidate Phase I gateway services to allow
ongoing receipt of international video content
and to support valuable data services
Establish a Help Desk for Earth station
concerns
Deploy teams to Phase II Incumbent
Earth Stations to install antenna
equipment and filters
Deploy teams to Phase I Incumbent
Earth Stations to install antenna
equipment and filters
Raise the satellites to their
testing orbital locations
Migrate services from old
satellites to new satellites
Outreach to Phase I Incumbent Earth
Station operators to schedule equipment
Outreach to Phase II Incumbent Earth
Station operators to schedule equipment
installation by SES-hired team
Move the satellites to their
final orbital locations and
initiate service on the satellites
Conduct Phase I customer migrations
Conduct Phase II customer migrations
ON-THE-GROUND
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES ANNUAL REPORT 202120
>355M
TV Homes served
~8,400 €1,046M €3.1B
TV channels Revenue
in 2021
Fully protected
contract backlog
SES | VIDEO:
MOVING
IMAGES
THAT MOVE
THE WORLD
SES ANNUAL REPORT 202121
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
UNPARRELLED AUDIENCE REACH
Video business has an unparalleled reach of more than 355 million
households, serving over 1 billion people worldwide with high quality
viewing experiences, and delivers managed media services for both
linear and non-linear content.
With over 30 years of broadcasting experience, we are experts in
designing systems to grow audiences, reduce costs, and maximise
operational efficiency.
Our managed services cover the entire media supply chain both on
premise and in the cloud. All with a single point of contact.
We are a trusted partner to the world’s leading broadcasters, platform
operators and content owners. We deliver:
• Linear video aggregation and distribution capabilities to hundreds
of millions of direct-to-home (DTH), direct-to-cable (DTC), and
Internet Protocol TV (IPTV) households around the world.
•
Hybrid video platform solutions which extend online video platform
capabilities by combining DTH and over-the-top (OTT) into one
seamless user experience and bringing targeted advertisement and
audience measurement capabilities to DTH platforms which were
so far only possible in the OTT area.
• Channel management solutions, including playout, which combine
several products to predefined end-to-end solutions capable of fit-
ting different use cases.
At 31 December 2021, the SES fleet distributed 8,386 total TV chan-
nels (up 1% year-on-year) to audiences around the globe. This
includes some 3,105 TV channels in High Definition which grew by
6% year-on-year.
Every day, we manage playout for over 525 channels and deliver over
8,400 hours of online video streaming (including more than 620 hours
of premium sports and live events).
2021 PERFORMANCE
For the year ended 31 December 2021, Video generated total revenue
of €1,046 million which represented 59% of group revenue.
On an underlying basis (excluding periodic revenue), Video revenue
was 4.6% lower (at constant FX) than the previous year, an improved
trajectory compared with an 8.0% year-on-year reduction in each of
2020 and 2019.
2021 Video Revenue by Segment
The impact from customers ‘right-sizing’ volumes in mature markets
(Western Europe and the US), lower US wholesale revenue, and the
decision to reduce exposure to low margin services activities led to
an overall year-on-year revenue reduction, albeit at a much slower
pace of decline as compared with the trends in 2020 and 2019.
The initial benefit of the increase in the cost to renew a 12-month
subscription implemented in March 2021 and continued growth in the
average number of paying subscribers led to year-on-year growth for
HD+ in Germany. Looking forward, the full annualised contribution
from the price increase and the introduction of new Internet Proto-
col-based solutions, such as HD+ ToGo (launched in October 2021)
and HD+ IP (launched in February 2022), into the market are expected
to support the future development of the business.
In addition, International market revenue was flat year-on-year, while
revenue from Sports & Events is continuing to recover, with improved
performance compared with 2020 which was impacted by cancella-
tions and delays caused by the COVID pandemic.
2%
Sports & Events
13%
HD+
59%
Europe
7%
North America
19%
International
SES ANNUAL REPORT 202122
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
AMAZING CUSTOMER EXPERIENCES
EXTENDS LONG-TERM PARTNERSHIP WITH SKY
WITH MULTI-YEAR AGREEMENT
In February 2021, Sky UK extended its contract with SES for satellite
capacity in a new multi-year, multi-transponder agreement which
added over €90 million in secured backlog.
This renewal is in addition to capacity already under contract that
extends through 2027 and means that, by the end of the renewed
contract, Sky UK will have been an SES customer continuously for
almost four decades, illustrating the strength and value of the part-
nership to Sky UK’s business in terms of the reliability, performance,
high-quality viewing experience and the reach of our satellite services.
As part of the contract, SES will deliver Sky UK’s channels in a mix of
standard definition (SD), high definition (HD) and ultra-high defini-
tion (UHD) from the 28.2/28.5 degrees East orbital slots to the oper-
ator’s subscribers across the United Kingdom and Republic of Ireland.
“
We’re pleased to continue working with SES, a world
leader in satellite provision. SES has been a valued part-
ner to Sky for decades and this agreement represents the
latest step in a long and successful relationship.”
Patrick Behar,
Chief Business Officer at Sky UK
CGTN CHANNELS TO SWITCH TO HD IN SES
AND GLOBECAST RENEWAL AGREEMENT
From September 2021, audiences across Europe are now able to watch
China Global Television Network (CGTN) channels in high-definition
(HD) due to a new capacity agreement.
Globecast, the global solutions provider for media, extended its
partnership with SES to deliver three CGTN channels in HD using
Globecast’s media services and SES’s satellites at 19.2 degrees
East.
Under the multi-year agreement, Globecast will lease additional
capacity at our prime neighbourhood to deliver CGTN News, CGTN
Documentary and CGTN French, and will manage the uplinking and
contribution services for these channels. After a simulcast period, all
three Chinese public broadcaster’s channels will broadcast exclusively
in HD by the end of the year.
“
As premium broadcast service provider in the European
region, when CGTN approached us with their plans to
move to HD, our obvious choice was to work with our
long-term partner, SES, to identify key positions. It’s a
pleasure to start a new transponder on Astra 19.2 location
with 24/7 channel monitoring services to reach large
audiences for key public broadcaster like CGTN.”
Shakunt Malhotra,
Managing Director-Asia of Globecast
DISH MEXICO TURNS TO SES’ ONE-STOP SHOP
FOR LINEAR AND ON-DEMAND CONTENT
In November 2021, we announced that long-term customer Dish
Mexico will be leveraging both our direct-to-home and over-the-top
offerings to deliver greater content choice and seamless function-
ality to their subscribers and new viewers nationwide. These new
multi-year agreements added $85 million in secured backlog.
Dish Mexico selected our Online Video Platform (OVP) solution
for its ability to seamlessly integrate linear channels, third-party
and on-demand content from multiple sources, eliminating the
need to switch between applications and enhancing the viewing
experience.
Additionally, Dish Mexico extended their decade long DTH partner-
ship with SES to continue leveraging the QuetzSat-1 satellite to deliver
affordable pay-TV services throughout the region.
“
Dish Mexico and SES first introduced an affordable DTH
service to the region nearly a decade ago, and today we’re
leveraging SES’s trusted technical expertise to offer a
powerful DTH-OTT combination bound to redefine the
viewing experience for our two-million-plus subscribers.”
Roger Quintin,
GM / Director at Dish Mexico
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES ANNUAL REPORT 202123
+27%
growth in underlying revenue
since 2017
ONLY €735M €2.1B
Multi-orbit, intelligent,
cloud-enabled satellite-based
global network
Revenue
in 2021
Fully protected
contract backlog
SES | NETWORKS:
CHANGING
LIVES BY
CONNECTING
PEOPLE
SES ANNUAL REPORT 202124
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
DIFFERENTIATED NETWORKS OFFER
Our Networks business operates the world’s only multi-orbit constel-
lation of satellites with the unique combination of global coverage
and high performance, low latency MEO system.
By leveraging a vast and intelligent, cloud-enabled network, we pro-
vide managed connectivity and data service solutions on a global
scale to support a wide range of fixed and mobile applications which
allow major Government, Fixed Data (Telco, MNO, and cloud) and
Mobility (Aeronautical and Maritime) customers to extend their net-
work reach across the entire world.
SES is the first, and only, satellite operator to have been certified with
the Metro Ethernet Forum (MEF) 2.0 industry standard, used to rate
the performance of terrestrial networks. By adopting telco- and
cloud-inspired practices, we are making it easier for customers to
integrate satellite-based networks into the global ecosystem.
Our Networks products and services are focused on delivering secure,
reliable, and high performing connectivity to customers across high
value Government, Fixed Data, and Mobility segments. We deliver:
• A range of Aero-ISR, Naval connectivity, fixed enterprise, and com-
munications on the move services, catering to a wide range of civil-
ian and defence-related Government connectivity needs.
• Trunking, mobile backhaul, and enterprise services for telecommuni-
cations companies (telcos), internet service providers (ISPs), satellite
service providers, mobile network operators (MNOs), and enterprises.
• Energy and mining solutions for service providers that support off-
shore exploration, offshore support vessels, and large production
facilities in developing countries.
•
Services to connect cruise lines, commercial aviation partners, busi-
ness jets, and telecom service providers with commercial maritime
operations.
In addition, we offer connectivity to major cloud service providers.
2021 PERFORMANCE
For the year ended 31 December 2021, Networks generated total rev-
enue of €735 million which represented 41% of group revenue.
On an underlying basis (excluding periodic revenue), Networks deliv-
ered a resilient performance (up 0.5% year-on-year at constant FX)
against the backdrop of an extended COVID-impacted environment.
2021 Networks Revenue by Segment
Our Government business is comprised approximately 60% for multiple
defence and civilian US Government agencies while approximately
40% of revenue is generated from a range of global government and
institutional clients.
In 2021, the positive contribution from new MEO- and GEO-enabled
network and institutional solutions for both the US and Global cus-
tomers led to year-on-year growth in government revenue compared
with 2020. This was partly offset by the cancellation of services dur-
ing Q3 2021 resulting from the US withdrawal from Afghanistan.
Our Fixed Data revenue is distributed across all key markets includ-
ing the Americas (nearly 40%), Asia-Pacific region (approximately
20%), Africa and the Middle East (approximately 20%), with the
balance from European, Energy, and Cloud customers.
Underlying Fixed Data revenue decreased in 2021 by a low-single digit
amount compared with the prior year as lower year-on-year revenue
in the Pacific region and wholesale business in Africa was not yet
being balanced with the ongoing growth in new business from tier
one mobile network operators, notably in the Americas and Asian
regions, as well as new revenue in the global cloud segment.
Approximately 55% of Mobility revenue comes from Aeronautical cus-
tomers (mainly global service providers) with around 45% of revenue
generated from the combination of major cruise lines and commercial
maritime customers.
In the Mobility segment in 2021, the effects of the COVID pandemic
on customers in the commercial aviation and cruise segments resulted
in lower revenue compared with 2020. This was partly offset by a pos
-
itive year-on-year performance in commercial shipping revenues. The
long-term fundamentals remain strong with sequential revenue
improvement during H2 2021 reflecting recovery in Cruise, as ships
return to service, and new business providing additional capacity to
commercial aviation customers.
40%
Government
28%
Mobility
32%
Fixed Data
SES ANNUAL REPORT 202125
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
AMAZING CUSTOMER EXPERIENCES
EXPANDING CRITICAL CONTENT CONNECTIVITY
SOLUTIONS FOR THE US GOVERNMENT
During 2021, SES Government Solutions (SES GS), a wholly owned
subsidiary of SES, delivered a range of solutions and commercial mile-
stones, enhancing our long-standing relationship as a key partner to
the US Government and its various civilian and defence agencies.
Starting in February 2021, SES GS announced the award of a new task
order against the single-award Blanket Purchase Agreement with the
U.S. Department of Defense to deliver a portable maritime MEO ser-
vice to support U.S. military personnel overseas which exceeded cus-
tomer expectations and was ultimately well received.
In May 2021, SES GS expanded its high-throughput, low-latency ser-
vices in support of mission-essential combatant command require-
ments. Using the unique combination of our O3b and GEO network,
U.S. Government customers can take advantage of the field-proven
capabilities to support the provisioning of enterprise-grade services,
leveraging our unique MEO constellation.
In July 2021, SES SG was awarded a new contract to support Thule
Air Base in Greenland with critical communications capabilities.
For over 20 years, SES GS has been the sole provider of satellite com-
munications to the base, overcoming the challenging conditions of
operating in an extreme cold weather environment and dealing with
unpredictable weather patterns to deliver critical data services and
enhanced reliability at the US Government’s northernmost base.
EXPANDING OUR PARTNERSHIP WITH ORANGE
TO ENHANCE MARITIME SERVICES
In August 2021, Orange agreed to integrate its own global infrastructure
with the global network coverage powered by our Skala Global Platform
which will enable Orange maritime customers to cost-effectively scale
up their bandwidth with seamless, ubiquitous, and global services.
This latest agreement further strengthened the partnership between
the Orange Group and SES. Orange has leveraged our innovative O3b
satellite constellation operating in medium earth orbit and geosta-
tionary satellites to deliver global fibre-like, low-latency services to
their mining customers, as well as deploying cellular services across
remote areas of Africa. Orange is also the first announced network
operator to adopt O3b mPOWER.
“
At Orange, we continue to believe that satellite is a
future-oriented technology and that the many recent
innovations in this industry will give it a growing place in
the telco area, whether in Africa, in more developed areas
such Europe or North America, or in specific industries
such as maritime. Therefore, we are glad to reinforce our
partnership with SES, as it will add a new component to
our overall mission at Orange, that of building intelligent,
open and innovative networks to support the digital
transformation of our business customers and provide
access to digital usage to the largest number of people.”
Jean-Luc Vuillemin, Executive Vice President,
Orange International Networks Infrastructures and Services
O3B MPOWER TAPPED BY MICROSOFT FOR
AZURE NETWORK CLOUD SERVICES
In August 2021, Microsoft became the first cloud provider customer
for our next-generation medium earth orbit system – O3b mPOWER.
Microsoft plans to leverage the MEO high-performance connectivity
services to showcase its Azure Orbital solutions that integrate satel-
lite connectivity with Azure services. Microsoft will use our current
MEO to provide connectivity now before migrating to O3b mPOWER.
Microsoft’s plans to deploy O3b mPOWER at Azure Network locations
is another step in the close collaboration between the two companies.
SES is co-locating four of its O3b mPOWER gateways at or near Azure
data centres; is the founding medium Earth Orbit satellite connectiv-
ity partner for Microsoft Azure Orbital; is an Azure ExpressRoute for
satellite partner; and is the first satellite operator to implement Open
Network Automation Platform (ONAP) on Azure.
“
Utilising SES’ medium earth orbit system enhances the
power of Azure Orbital and enables us to deliver greater
resiliency and comprehensive satellite connectivity solu-
tions for our customers. Our collaboration with SES is key
to delivering on our vision of multi-orbit, cloud-enabled
capability to meet critical industry needs.”
William Chappell,
Vice President of Azure Global, Microsoft
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES ANNUAL REPORT 202126
€1,782M
2.9
TIMES
€1,091M +€779M €0.50
2020:
€1,876M
Group
revenue
2020:
3.0 times
Adjusted Net Debt to
Adjusted EBITDA ratio
2020:
€1,152M
Adjusted
EBITDA
2020:
€33M net expense
US C-band contribution
to reported EBITDA
2020:
€0.40 per share
Proposed dividend
per A-share
FINANCIAL
REVIEW &
OUTLOOK
SES ANNUAL REPORT 202127
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SES regularly uses Alternative Performance Measures (APM) to pres-
ent the performance of the Group and believes that these APMs are
relevant to enhance understanding of the financial performance and
financial position. Further information regarding these APMs is pro-
vided in >> Note 35 of the Consolidated Financial Statements.
INCOME STATEMENT
Group revenue of €1,782 million was 5.0% lower than the prior year
including the negative impact of the weaker Euro to US Dollar foreign
exchange (FX) rate which accounted for €41 million of the year-on-
year variance. Group revenue included €2 million of periodic and other
revenue (2020: €9 million).
Underlying revenue of €1,780 million (excluding period and other
revenue) was 2.6%, or €47 million, lower than the prior year (at con-
stant FX) reflecting a reduction in underlying Video revenue (down
4.6% year-on-year), while Networks (up 0.5% year-on-year) delivered
an additional €4 million of revenue compared with 2020.
Adjusted EBITDA (excluding restructuring expenses and the financial
impact of US C-band repurposing) stood at €1,091 million (2020:
€1,152 million) and represented a margin of 61.2% (2020: 61.4%). This
included recurring operating expenses of €691 million which were
€17 million, or 2.4%, lower (at constant FX) than the prior year.
Adjusted EBITDA excludes restructuring expenses of €8 million,
compared with €40 million in 2020, and a pre-tax gain from US C-band
repurposing of €779 million (2020: €33 million net expense), includ-
ing an amount of €839 million from the recognition of the first accel-
erated relocation payment related to the successful completion of
Phase I clearing in advance of the 5 December 2021 deadline.
Depreciation and Amortisation (D&A) expense reduced by 7.0% year-
on-year to €670 million.
Successful refinancing of maturing debt at lower rates contributed to
a 21.1% year-on-year reduction in net interest expense to €120 million
(2020: €153 million), including capitalised interest of €7 million (2020:
€5 million). In addition, the group recognised an FX gain of €37 mil-
lion (2020: €32 million loss).
As a result, Adjusted Net Profit for the year ended 31 December 2021
was €323 million, up from €191 million in 2020, also including the
impact of lower recurring income tax expense of €34 million compared
with €66 million in 2020.
Adjusted Net Profit excluded (net of tax) the restructuring expenses
of €8 million, the US C-band items, and the recognition of €724 mil-
lion in non-cash impairment expenses, primarily relating to the write-
down of goodwill in our North American cash generating unit (CGU)
which was triggered largely by the recognition of the income from the
first US C-band accelerated relocation payment of €839 million.
CASH FLOW STATEMENT
Free cash flow before equity distributions and treasury activities
(FCF) was €876 million (2020: €665 million) as the higher net cash
absorbed by investing activities of €283 million (2020: €217 million)
was more than offset by the combination of higher net cash gener-
ated by operating activities of €1,294 million (2020: €1,049 million)
and lower cash interest paid on borrowings of €121 million (2020: €152
million). FCF also included lease payments of €14 million (2020: €15
million).
FINANCIAL POSITION
At 31 December 2021, Adjusted Net Debt (including 50% of the now
€1.175 billion of hybrid bonds as debt, per the rating agency method-
ology) stood at €3,120 million, compared with €3,418 million 12 months
ago, and represented an Adjusted Net Debt to Adjusted EBITDA ratio
of 2.9 times (2020: 3.0 times).
Total borrowings (excluding hybrid bonds) of €3,581 million were
8.9% lower year-on-year. Cash and cash equivalents of €1,049 million
at 31 December 2021 included €344 million received as part of the
C-band accelerated relocation payment, while the balance of the
payment (€518 million) was received in early January 2022.
In May 2021, the group launched and priced a hybrid bond offering
totalling €625 million with an annual coupon of 2.875%. The proceeds
from the offering were used to replace an outstanding hybrid bond
of €750 million which carried an annual coupon of 4.625%. As a result,
the total amount of hybrid bonds was reduced from €1.3 billion to
€1.175 billion, and the weighted average coupon was lowered from
5.05% to 4.16% realising an annualised cash cost saving of more than
€15 million.
Debt maturity profile
Revolving Credit Facility Other Debt
Cash & cash equivalents Senior Bonds
>203020292028202720262025202420232022
1,049
1,200
662
150
250
650 640
400
662
16
57
16
16
16
16
50
Weighted average senior debt maturity of 7.5 years
SES ANNUAL REPORT 202128
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
At 31 December 2021, the weighted average cost of debt (including
50% of the hybrids) was 2.9% (2020: 3.3%) and the weighted average
senior debt maturity was 7.5 years (2020: 7.2 years) with no significant
senior bond maturities before Q2 2023.
FINANCIAL POLICY
SES is focused on driving sustained, profitable growth and value cre-
ation. In tandem with clear strategic priorities, strong focus on exe-
cution, and financial discipline, we aim to maintain a disciplined finan-
cial policy which is based on four main priorities:
• Disciplined investment to sustain the profitable portfolio of busi-
ness and support value-accretive growth investment opportunities,
as reflected by our internal rate of return hurdle of more than 10%
(post-tax) over the investment horizon.
• Maintaining a strong balance sheet consistent with investment
grade ratios, allowing access to a wide range of funding sources
and keeping a low cost of funding.
• Delivering a cash return to shareholders by maintaining a min-
imum annual base dividend of €0.50 per A-share and €0.20 per
B-share with a stable to progressive policy.
• Utilising any excess cash in the most optimal way for the benefit
of shareholders.
In July 2021, SES completed a share buyback programme totalling
€94 million. 12 million A-shares were purchased at a weighted aver-
age price of €6.56 and 6 million B-shares at a weighted average price
of €2.62, maintaining the ratio of two A-shares to one B-share, as
required by the Articles of Association. The shares acquired under
the programme are intended to be cancelled, reducing the total num-
ber of voting and economic shares.
For the year ended 2021, the SES Board of Directors has proposed a
dividend of €0.50 per A-share and €0.20 per B-share, representing
an increase of 25% over the prior year dividend and is consistent with
the Board’s commitment to maintain a stable to progressive dividend
policy. The dividend, which is subject to shareholders’ approval at the
Annual General Meeting on 7 April 2022, will be paid to shareholders
on 21 April 2022.
FINANCIAL OUTLOOK
The financial outlook is based on an average €/$ FX rate of €1: $1.13,
nominal satellite health, and nominal launch schedule.
For the year ended 31 December 2022, revenue is expected to be
between €1,750 million and €1,810 million. This reflects an expecta-
tion of mid-single digit year-on-year percentage decline (at constant
FX) in Video and between low-single and mid-single digit year-on-
year percentage growth (at constant FX) in Networks.
Adjusted EBITDA for the same period is expected to be between
€1,030 million and €1.070 million with an implied year-on-year increase
(at constant FX) in recurring operating expenses due to anticipated
spend in Networks, associated with the entries into commercial
service of SES-17 (expected mid-2022) and O3b mPOWER (expected
service introduction by end-2022).
The future contributions from SES-17 and O3b mPOWER are expected
to be an important driver of low- to mid-single digit average growth
(at constant FX) in group revenue and Adjusted EBITDA from 2023
onwards. This outlook anticipates a ‘flattening of the curve’ in Video
to low-single digit average decline (at constant FX) being more than
offset by an acceleration to high-single/low-double digit average
growth (at constant FX) in Networks.
Capital expenditure (defined as net cash absorbed by investing activ-
ities excluding acquisitions, financial investments, and US C-band
repurposing) is expected to be €950 million in 2022 reflecting growth
investments in SES-17 and O3b mPOWER. Thereafter, capital expend-
iture is expected to reduce to €510 million in 2023, €570 million in
2024, €380 million in 2025, and €360 million in 2026.
SES Horizon Strategy
SES ANNUAL REPORT 202130
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
ENVIRONMENTAL, SOCIAL & GOVERNANCE (ESG) REPORT
We are proud to say that through extensive stakeholder outreach, SES
has developed a purpose led ESG strategy aligned with the Sustaina-
ble Development Goals and inextricably linked to our business success.
We are focused on 4 key pillars – Sustainable Space, Climate Action,
Diversity and Inclusion, and Critical Human Needs.
We know we can impact each of these areas as a business and in col-
laboration with our stakeholders and the industry. In addition to setting
the strategy and focus areas, we have endeavoured to put some account-
ability into our programme by making clear targets for the business to
achieve. In some areas, we have some work to do to know what aspect
we want to focus on or how to measure our success and we have tried
to be transparent in this report to signal where we are in the journey.
To signal our commitment to transparency and accountability, we
have incorporated new reporting standards into this report and joined
the UN Global Compact. This report has incorporated Global Report-
ing Initiative (GRI) and Sustainability Accounting Standards Board
(SASB) into our reporting as well as a detailed explanation of our
stakeholder outreach and materiality. We will be growing reporting
initiatives in the coming years and continue to evaluate where we can
be more transparent and inclusive of necessary disclosures. Joining
the UN Global Compact was the first step for SES committing to a
new approach to ESG. We are proud to join a membership of busi-
nesses with a strong commitment to driving sustainability and socially
responsible policies.
In addition, we have detailed applicable programmes and areas where
we have been active in making an impact this year. We are excited
to see the impact this strategy and our work has on the world and on
our business. We invite all our stakeholders along on the journey – to
learn, innovate and impact the world, together.
SUSTAINABLE
SPACE
CLIMATE
ACTION
DIVERSITY &
INCLUSION
CRITICAL
HUMAN NEEDS
Lead, collaborate, and innovate
for sustainable space.
Take bold climate action by
setting targets and innovating
for the planet.
Make the space industry more
diverse and inclusive, starting
with SES.
Empower communities with
services required for everyone
to thrive.
WHERE SUSTAINABLE SPACE MEETS SUSTAINABLE EARTH
For years, SES has been providing satellite services to improve the
lives of people on the planet. Whether it’s delivering content or con-
nectivity, we believe that “making a difference” matters and it is an
important motivation for us in the way we approach our business …
but this was not enough.
We wanted to raise the bar and make sure that we are extending our
philosophy of doing business to our communities, supply chain and
viewing them from the perspective of investors and government agen-
cies – to name a few.
In 2021, we embarked on a new journey to evaluate the ways SES
makes a difference through a different lens inclusive of our stake-
holders and challenging ourselves to ask not only what our respon-
sibility as a company is but what more can we do to impact the planet
and help us all collectively achieve the sustainable development
goals?
SES ANNUAL REPORT 202131
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
OUR HORIZON
STRATEGY
SUSTAINABLE SPACE
SUPPORTING 11 OF THE 17
CLIMATE ACTION DIVERSITY & INCLUSION CRITICAL HUMAN NEEDS
Lead, collaborate, and innovate
for sustainable space.
Take bold climate action
by setting targets and
innovating for the planet.
Make the space industry
more diverse and inclusive,
starting with SES.
Empower communities to
thrive with services to support
critical human needs.
OUR RESPONSIBILITY
Innovate to reduce our footprint from launch
todecommissioning.
OUR OPPORTUNITY
Advocate best practice approaches to ensuring
industry-wide responsible use of space.
OUR TARGETS
• By 2030, complete life cycle assessments
onall SES products and fully understand the
impact that our product and services have
onearth and in space
• Explore partnerships to develop innovative
solutions and new technologies for space
sustainability
• By 2024, become certified by the upcoming
Space Sustainability Rating of the World
Economic Forum
OUR RESPONSIBILITY
Build a more diverse and inclusive workforce
across all levels of our business.
OUR OPPORTUNITY
Increase diversity and inclusion in the
space industry through targeted actions
and investments.
OUR TARGETS
• Increase gender diversity of people managers
and executives in the business by 50% in
5years
• By 2025, develop and implement a supplier
and customer sustainability rating and
diversity program to empower a diverse
pool of sustainable suppliers
• In 2022, SES will develop a plan to build
on our STEM and ICT outreach in order to
expand our impact on students from under-
represented groups
OUR RESPONSIBILITY
Develop partnerships and innovate to increase
access to education, health, and information
services.
OUR OPPORTUNITY
Expand reliable access to content and
connectivity to build sustainable communities.
OUR TARGETS
• In 2022, conduct intense stakeholder
outreach to understand where our
products and services can intentionally
and meaningfully impact human needs
aligned with and in collaboration with
stakeholder and the UN SDGs
OUR RESPONSIBILITY
Reduce Green House Gas emissions across
operations and our supply chain.
OUR OPPORTUNITY
Provide solutions to combat environmental
challenges through satellite connectivity.
OUR TARGETS
• By no later than 2050, SES will reach
NetZeroemissions
• In 2022, SES will begin developing targets
aligned with the SBTi for submission and
validation by no later than 2024
SES ANNUAL REPORT 202132
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
ADVANCING SUSTAINABLE DEVELOPMENT
ON EARTH AND IN SPACE
SES does the extraordinary in space to deliver amazing experiences
everywhere on earth. We believe that those amazing experiences on
earth must include our ability to advance sustainable development
aligned with the goals of the UN. SES can uniquely harness the power
of space to address the most pressing challenges on earth. Along with
our customers, partners, and governments, we can accelerate pro-
gress towards a more sustainable, secure, and equitable future.
SES ESG strategy focuses on 4 pillars where the company can
uniquely lead and contribute to the UN Sustainable Development
Goals (SDGs) with issues material to our business strategy and
approach.
SES recognises and believes we can positively contribute to the world
in the way we operate, our collaborations in the industry and in how
we deliver our products and services.
SUSTAINABLE SPACE
SES has been operating in space for over 35 years and has been lead-
ing the satellite communications industry with innovative technolo-
gies to meet the needs of consumers on the ground. Since our found-
ing, many new space players have entered the market and the use of
space technologies has and continues to grow Space companies, old
and new are providing critical infrastructure to the planet. If this
resource is not protected and space actors are not held to a high
standard of responsibility, these critical services are endangered. We
believe it is critical to lead, collaborate and innovate to ensure the
sustainable use of space for decades to come. SES has a responsibil-
ity to innovate the ways to reduce our own footprint across the life-
cycle of our services- from launch to decommissioning of the satellite.
Nevertheless, this should not be the limit to SES’ sustainable space
ambitions. As a leader in the industry, we must advance the respon-
sible use of space by advocating and collaborating for best practice
approaches and innovative solutions so that space continues to be a
resource for delivering solutions to address the challenges on earth.
CLIMATE ACTION
Every company has a responsibility to our planet by making commit-
ments to reduce emissions. At SES we are committing to climate
action in line with the Paris Climate Accord. SES is initiating its Net-
Zero journey, by reformulating its corporate strategy to include cli
-
mate change at its core. As such, we have committed to setting a
NetZero target in line with the SBTi Criteria and Recommendations.
We are dedicated to reaching NetZero by no later than 2050. We
know that this commitment will require a reduction in operational
emissions as well as a close examination of our emissions up and down
our value chain. We are early in this journey but committed to this as
a core piece of our ESG strategy. Additionally, SES knows that satel-
lite connectivity is a powerful tool for customers to deliver critical
services on earth. We think there is great opportunity to innovate and
provide solutions to help our customers solve their climate and envi-
ronmental challenges and collaborate to provide solutions for climate
action. Starting in 2022, we will be examining ways that we can lev-
erage our technology in this way.
DIVERSITY AND INCLUSION
Providing for a more equitable future on earth begins with our own
diversity within SES and the space industry at large. We know that a
diverse workforce and industry not only helps us to achieve our finan-
cial goals as a business but also provides a better and more repre-
sentative work environment to our employees and contributes to the
future of sustainable communities. SES is proud of the steps it has
taken in this area in the past 2 years through our established D&I pro-
gramme, however, when developing our ESG strategy we knew we
wanted to commit to advancing our work with clear priorities and tar-
gets for going forward, not only to build a more diverse and inclusive
workforce across all areas of our business, but also by making tar-
geted changes to increase the diversity within the space industry.
CRITICAL HUMAN NEEDS
At its core, SES provides products and services that connect people
to the content of the world. SES provides over 1 billion people with
access to news, information and entertainment and bring connec-
tivity to remote populations. Reliable, connectivity is key to driving
digitisation and boosting economies and producing positive out-
comes for individuals. Our products and services deliver this aligned
with the sustainable development goals and we believe that we can
continue to align our business goals to direct innovation and part-
nerships to expand access to educational, health and informational
services. Together with industry partners, customers and govern-
ments we know we can expand reliable access to content in isolated
places.
MATERIALITY
SES is committed to the creation of a more robust, resilient, inclu-
sive, sustainable, and well-connected society and created its ESG
strategy with this awareness. We believe that companies operate as
a key member of society and therefore have a responsibility to all
stakeholders to acknowledge and report on their impact to society
and the environment. In 2021, SES engaged, with outside consultancy,
in multistakeholder dialogues to better understand external and
internal stakeholder needs and expectations. We were able to define
the most pressing issues to our stakeholders which resulted in an
in-depth materiality analysis on these issues. SES identified 25 mate-
rial issues.
STAKEHOLDER OUTREACH
SES outsourced material issue identification process to Globescan (a
public opinion research consultancy) which identified and prioritised
material issues through external interviews with industry experts, cus-
tomers, non-governmental organisation partners, civil society, and
government representatives. Additional internal input was collected
through workshops, surveys, and ESG investor rating analysis. While
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TARGETS
To bring our strategy to life, SES colleagues collaborated across the
business as we developed ambitious targets for each pillar area. The
details of our targets and how we plan to execute on them is further
explained in the corresponding sections of this report.
Space Sustainability
• By 2030, complete life cycle assessments on all SES products and
services together with technology partners to fully understand the
impact our product and services have on the planet
•
Explore partnerships to develop innovative solutions and new tech-
nologies for space sustainability.
•
By 2024, become certified by the Space Sustainability Rating being
developed by the World Economic Forum.
Climate Action
• SES commits to NetZero emissions by no later than 2050
• In 2022, SES will commit to science based targets and begin vali-
dation of these targets with SBTi
Diversity and Inclusion
•
Increase gender diversity of people managers and executives in
the business by 50% in 5 years.
• By 2025, develop and implement a supplier and customer sustain-
ability rating and diversity programme to empower a diverse pool
of sustainable suppliers.
• In 2022, SES will develop a plan to build on our STEM and ICT out-
reach in order to expand our impact on students from underrepre-
sented groups
Critical Human Needs
•
In 2022, conduct intense stakeholder outreach to understand where
our products and services can intentionally and meaningfully
impact human needs aligned with and in collaboration with stake-
holders and international goals.
sion, operational carbon footprint, energy use, and interaction with
the space and waste minimisation.
For a full analysis of our material issues, including definitions of material
issues and how these fit into the strategic themes of our strategy,
please reference the materiality document on the reporting section
of our website.
SES intends to continuously monitor the developments in its material
topics and work on ways to improve its data provision on the Tier 2
and 3 material issues.
prioritising material issues, Globescan focused on what is being
emphasised in established ESG frameworks (e.g., Global Reporting
Initiative, Sustainable Development Goals) to standardise SES mate-
riality.
MATERIAL ISSUES
SES groups material issues under three different tiers based on the
issue’s impact to the business and to the society. Most critical, thus
priority material issues are listed under Tier 1 category. These issues
include SES’ engagement with the digital society, Diversity and Inclu-
Materiality Matrix
Tier 1 Tier 2 Tier 3
• Emergency response / disaster manage-
ment
• Satellite / ground infrastructure end of life
• Climate adaptation and resilience
• Employee and worker rights, wellbeing and
safety
• Space policy and advocacy
• Use and recovery of toxics, precious
materials and conflict minerals
• Biodiversity and Land Use
• Water footprint
• Cybersecurity and data privacy
• Anti-bribery & corruption
• Environmental impact of satellite launches
• Responsible use of technology
• Customer environmental benefits
• Diversity in STEM education
• Employee recruitment, development &
engagement
• Operational waste
• Transparent supply chain management
• Digital access to basic services
• Employee diversity, equity & inclusion
• Space waste & congestion
• Digital reach & inclusion
• Ethical & transparent business practices
• GHG emissions (Scope 1, 2, 3)
• Renewables & energy use
• Local community impact
IMPORTANCE TO SOCIETY
BUSINESS IMPACT
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SUSTAINABLE SPACE
SES has been operating in space for over 35 years and is a leader in
responsible space use. Our ESG strategy focuses on sustainable
space and asks us to assume our leadership position to further col-
laborate and innovate to address the challenges of this unique oper-
ational environment.
TARGETS
As part of the targets associated with Space Sustainability, SES com-
mits to:
By 2030, complete life cycle assessments on all SES prod-
ucts and services together with technology partners to
fully understand the impact our product and services
have on the planet.
Completing life cycle assessments across our products and ser-
vices is a necessary step to evaluating and managing our foot-
print across our fleet. The life cycle assessment will evaluate the
environmental impacts of consumption and emissions associated
with all stages of the product throughout its life, the resources
consumed and pressures on human health. As recommended by
the European Space Agency, life cycle assessments for the space
industry will include design of the satellite from the raw materi-
als, manufacturing, distribution, utilisation verification and testing
and disposal of both the space and ground segments. Given the
number of assets and ground infrastructure we have and the spe-
cialised nature of space operations, we have given a 2030 time-
line. This is a critical step for us to minimise our impact across
our lifecycle and we will report on progress of these assessments
yearly.
Explore partnerships to develop innovative solutions and
new technologies for space sustainability.
Space Sustainability is a growing and quickly changing landscape.
We believe that we should explore new partnerships in this space to
ensure that we continue to lead and innovate for the maximum ben-
efit of our space environment.
By 2024, become certified by the Space Sustainability
Rating being developed by the World Economic Forum.
To encourage collective action and endorsement of best practices in
space, SES intends to undergo the Space Sustainability Rating pro-
cess being developed by the World Economic Forum. We feel confi-
dent in our current operations and management of our fleet and
believe that pursuing this rating can ensure that confidence to all our
stakeholders. The Space Sustainability Rating (SSR) is an ongoing
process to create transparency in participating organizations’ space
debris mitigation policies. Upon establishment, SSR will provide a sus-
tainability score for companies on their debris mitigation strategies
and their alignment with the international guidelines. In addition to
pursuing this rating, SES wants to continue to push the industry to
evaluate and define metrics for additional successful space sustain-
ability and intends to spend time in 2022 defining those metrics with
the stakeholder community.
REDUCING OUR SPACE FOOTPRINT
SES is an influential actor in the space domain and has a fleet large
enough to promote reduce, reuse, recycle mentality to minimise space
waste and congestion. We understand that addressing risks related
to satellites that are already in the orbit is an important part of mini-
mizing company related negative externalities as well as acknowledg-
ing the importance of preventing the growth of future debris. Our tar-
gets build on this understanding and focus on the work we can do to
better understand the effects of our satellites across their lifecycle
with the goal of developing concrete actions to reduce our footprint
Lead, collaborate, and innovate with the industry
to ensure secure and sustainable use of space.
Innovate ways to repurpose equipment and reduce
footprint from launch to decommissioning.
Lead the way as an advocate and collaborator to
develop best practice approaches for the responsi-
ble use of space.
SUSTAINABLE SPACE
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from launch to decommissioning. We know we are a responsible actor
in the management of our fleet and lead the industry in setting and
implementing best practice approaches. We look forward to contin-
uing to share as we discover more areas where we can lean forward
in reducing our footprint.
Fleet management
SES applies a responsible fleet management approach together with
its satellite manufacturers to mitigate the environmental impact and
to minimise space debris.
SES satellites receive their operating power from the sun, through
solar panels, outside the Earth’s atmosphere. They therefore create
no carbon emissions during their operating lifetimes. Nevertheless,
there are emissions associated with the satellite launches and their
maintenance. Since 2017, SES and SpaceX have pioneered reusable
rockets for satellite launches. This reduces space debris, allows the
reuse of materials that would otherwise go to waste, increases the
cadence of launches, and reduces launch cost.
SES satellites operate in either Geostationary Earth Orbit (36,000
kilometres from the Earth’s equator) or Medium Earth Orbit (8,000
kilometres from the Earth’s equator). At the end of the satellite’s oper-
ational life, it is re-orbited using remaining on-board propellant into
a graveyard orbit, approximately 200 kilometres beyond the Geosta-
tionary Earth Orbit. In general, our satellites do not re-enter the Earth’s
atmosphere and we follow the most stringent international standards
for re-orbiting and passivating space assets. We have one of the best
records in the industry terms of achieving a safe disposal of our sat-
ellites.
INDUSTRY COLLABORATION FOR
RESPONSIBLE SPACE USE
SES recognises the importance of industry collaboration as we
address new challenges associated with the exciting resurgence of
companies operating in space. Without industry level commitment
and collaboration, no company can safely or sustainably operate.
The space industry is growing and is expected to reach $1 trillion by
2030 according to the World Economic Forum (WEF). Rising space
activity in the recent years demonstrate that there is an urgent need
for action to minimise space debris and collisions and to ensure sus-
tainable space operation that is inclusive and progressive.
In 2021, SES has participated in collective action platforms and has
contributed to the formulation of policy documents on the importance
of Space sustainability together with the Satellite Industry Associa-
tion (SIA) and EMEA Satellite Operators Association (ESOA).
As a member of SIA, SES is committed to multistakeholder collabo-
ration in the space domain (including national space agencies and
regulatory entities) and acknowledges the principles of the UN Com-
mittee on the Peaceful Uses of Outer Space Guidelines for the Long-
Term Sustainability of Space Activities. SES puts a special emphasis
on designing, constructing, and launching commercial Geostationary
(GEO) and Non-Geostationary (NGSO) satellites that the company
can easily track by active or passive means.
SES makes its policies in line with the guidelines of the European
Commission on Defence Industry and Space and has been participat-
ing to the Space Traffic Management (STM) platform launched by
DEFIS (DG Defence Industry and Space). SES prioritises strong and
innovative space policy that is sustainable and inclusive. Taking part
in SpaceWays Operators Workshop to create a standardised STM con-
cept for the European space actors demonstrates the efforts of SES
to create a multistakeholder platform to advance sustainable and
robust space policies.
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SES is a signatory of the WEF Space Industry Debris Statement and
endorses the Space Safety Coalition as a prominent actor in the space
industry who continuously works towards reducing space debris and
safeguarding the Earth orbits. SES pledges its commitment to reduce
and prevent space debris and emissions caused by space activities
through these endorsements. SES works with governments, civil soci-
ety, commercial partners, and competitors to substantially reduce its
footprint and upscale innovative spacecraft and other means of tech-
nologies for this aim.
SES supports ESOA and interactively participates in increasing oper-
ational responsibility in the space and satellite connectivity domains.
In November 2021, SES has participated in ESOA Satellite Connectiv-
ity Summit in Bremen, Germany that explored areas of 5G integration
in satellite connectivity, driving down operational costs through stand-
ardizing network structures and innovating the satellite data services.
The event carried the characteristic of being the only event that
explored operational sustainability through deep dive into satellite
connectivity within Europe.
This topic is continually evolving and new players enter the field, we
feel a deeper commitment to lead the conversation and help others
as we navigate new solutions and technologies to ensure that space
is a fair and sustainable environment in which to operate.
OPERATIONAL RESPONSIBILITY
In 2021, SES continued to act as a responsible space actor by designing,
re-orbiting, and passivating reliable satellites in line with the International
Telecommunication Union (ITU) guidelines, the Federal Communica-
tions Commission (FCC) orbital debris mitigation practices and the
strictest national regulations on space sustainability and orbital debris
mitigation. SES has successfully re-orbited four satellites in 2021 above
the required Inter-Agency Space Debris Coordination Committee (IADC)
altitude, and successfully removed any stored energy and risk of future
explosion after disposal. SES continues to have one of the best records
in the industry in terms of achieving a safe disposal of its satellites.
Space Situational Awareness
This year, SES continued to monitor, alert, and avoid any predicted
conjunction or close approach between its satellites and other objects,
satellites or space debris keeping any predicted probability of colli-
sion near zero.
SES has extended its monitoring and warning systems by contribut-
ing data and subscribing to the conjunction assessment service of
the European Space Surveillance and Tracking (EUSST) network, for
all its satellites. This is in addition to the US warning system operated
by the Combined Space Operations Center (CSpOC) and the Space
Data Center warning system of the Space Data Association (SDA).
The Space Data Association (SDA) is a critical step towards bringing
satellite operators together to support the controlled, reliable, and effi-
cient sharing of data that is fundamental to ensure safety and integrity
in the space domain. SES has the Chairmanship of the Space Data Asso-
ciation since November 2019. In 2021, together with the other executive
members, SES organised the annual SDA members meeting to promote
best practices in space sustainability and present developments in the
Space Data Center and other developments in space safety to build
capacity amongst all the member on responsible use of space. SDA
plays a crucial role in achieving the Space traffic management (STM)
in the space industry.
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CLIMATE ACTION
SES’ business activities have a low environmental impact, yet SES
understands its responsibility to support the urgent action to prevent
climate change and to limit the increase in global temperatures. SES
environmental policy is structured around the company’s impact both
in space and on Earth. SES continuously works towards minimising
its environmental footprint, innovating technologies and exploring the
areas in which the technology can help solve problems.
TARGETS
SES is proud to commit to a NetZero emissions target by no later than
2050. SES has been reporting our emissions through the Carbon Dis-
closure Project for over 10 years, but we had previously not commit-
ted to a defined and validated target for reduction. We are happy to
be initiating our NetZero journey by evaluating our total footprint and
developing a target in line with the SBTi criteria and recommenda-
tions. Once we have concluded our evaluation, we will be updating
our progress with a roadmap for achieving our targets.
We know that our solutions are powerful for our customers in the ways
they interact with the world. In 2022, we want to additionally inves-
tigate the ways we can help our customers in meeting their climate
objectives and providing solutions for climate action. This will involve
customer and stakeholder outreach to understand how we can best
contribute to this global challenge.
OPERATIONAL FOOTPRINT
EMISSIONS- CDP REPORT RESULTS
GRI 305
This report is inclusive of our CDP report results from the 2020 oper-
ating year, given our CDP reporting cycle.
SES is aware of its role of spearheading emissions reduction in the
telecommunication and space industries. The company does not
operate any manufacturing sites which minimises the company’s total
environmental impact. To further minimise risks across the business
and to better align with the company’s objectives to reduce CO
2
emis-
sions, SES uses its Risk and Internal Control System. Upon identifying
risks through COSO and ISO31000 principles, SES collects emissions
data on its direct, energy indirect, and other indirect operations
(Scope 1, 2, and 3). The company constructs its methodology in line
with the Greenhouse Gas Protocol (GHG): A Corporate Accounting
and Reporting Standard (Revised Edition); Defra Environmental
Reporting Guidelines: Including streamlined energy and carbon
reporting guidance, 2021; the International Energy Agency’s (IEA) CO
2
Emissions from Fuel Combustion; and The Greenhouse Gas Protocol:
Scope 2 Guidance.
Each year, SES reports the CO
2
emissions of its operations through
participation in the Carbon Disclosure Project (CDP), which collects
the data of all SES’ business activities and locations. The data collec-
tion for CDP covers three scopes:
• Scope 1: Direct Combustibles (gas and fuel consumption, refriger-
ant leakage, car fleet)
•
Scope 2: Indirect Energy consumption (purchased electricity, heat,
and steam)
•
Scope 3: Other Emissions (business travel, commuting, waste,
water consumption)
In 2020, the company’s activities related to operating and commer-
cialising SES’ satellite fleet, as well as general administration, finance
and marketing generated 32,606 metric tons of CO
2
emissions world-
wide, a decrease of 32% compared to 2019. Lower Scope 2 emissions
(down 13% year-on-year) and Scope 3 emissions (down 74% year-on-
year) have contributed to the highest decrease in SES emissions since
Take bold climate action by setting targets and
innovating for the planet.
Reduce our carbon footprint across operations
and our supply chain.
Provide solutions to overcome climate and
environmental challenges through satellite
connectivitiy.
CLIMATE ACTION
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the company started reporting to the CDP. Even employee commut-
ing and business travel excluded (due to COVID), increased energy
efficiency and waste treatment among other areas of improvement
contributed to a Covid-19 adjusted 12% reduction in overall emissions.
Given SES operates in space, our emissions from Scope 1 are small
(approximately 8%) and while modestly lower than 2019, our 2020
level was comparable with that of 2018.
Emissions from Scope 2, electricity consumption, represented the
largest component of SES’ total emissions (approximately 79%). SES
has diversified away from non-renewable energy sources and achieved
remarkable decreases in fuel (27%), natural gas (40%), and propane
(24%) consumptions.
To better interpret Scope 2 emissions data, it is important to note that
Scope 2 location-based emissions factors were chosen in line with
the GHG Protocol recommendations. For low occupancy sites,
assumptions were made based on average electricity, gas, and travel
data at the main office sites. A data collection questionnaire was cir-
culated to all 38 main SES global sites and to collect activity data. A
large sample of low occupancy and unmanned SES sites were included
in the data collection exercise. In order to calculate GHG emissions,
when electrical power consumption was not precisely measured, it
was estimated. In the context of the legal framework in Europe with
the goal to save energy, SES started to analyse the energy efficiency
of the main facilities in accordance with EN 16247. This exercise has
been performed at SES’ sites in Munich, Germany, and Betzdorf, Lux-
embourg. Through these and other initiatives, we have implemented
a substantial and ongoing carbon reduction plan in our sites across
the world.
WASTE MANAGEMENT
GRI 306
SES intends to systematically reduce waste across its direct footprint.
The company ensures that it has a comprehensive waste strategy in
place that targets avoiding and reducing waste as well as increasing
disposal and recycling in the areas of “Batteries, hydraulic fluids and
electrical/electronic devices, building-site waste, glass, plastics, met-
als, organic waste (food residues, garden refuse, wood), paper/card-
board, and problematic items (e.g. chemicals/environmentally haz-
ardous substances, oil/grease, flammable products, etc)” in line with
international standards (ISO 140 42). SES currently collects informa-
tion for the SES Headquarters in Luxembourg and annually reports
to the Luxembourgish government. For its remarkable environmen-
tally friendly waste handling, SES has been awarded with the Luxem-
bourg SuperDrecksKescht (SDK) ecolabel 20 years in a row. Our goal
over the last 20 years was to manage waste efficiently, environment
SES Group CO
2
emissions
T CO2E
Scope 1 Scope 2 Scope 3
0
10
20
30
40
50
60
20102011201220132014201520162017201820192020 201820192020
30.80
4.25
2.51
32.84
MBM
16.05
2.18
33.97
17.18
2.52
25.85
4.25
2.51
29.60
16.05
2.18
30.82
17.18
2.52
26.98
17.39
2.52
24.70
13.74
LBM
2.42
24.40
12.49
5.46
17.08
11.46
6.55
17.39
14.76
6.62
20.48
5.87
6.96
27.76
4.94
6.46
26.85
2.31
12.40
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friendly and in line with our SDK certification. In 2020, SES generated
164,776 kgs of waste and 52% (85,436 kg) were diverted from dis-
posal and the remaining 48% (79,340 kgs) were directed to disposal
through landfills indicating a progressive improvement in SES’ waste
strategy.
Supply chain waste minimisation
Contractors, sub-contractors, and suppliers are required to support
SES waste reduction by implementing policies and procedures regard-
ing waste management. SES currently works on strengthening its sup-
ply chain compliance to ensure its suppliers implement ambitious
waste reduction policies in line with SES objectives.
ENERGY
GRI 302
SES is aware of its responsibility to improve and transform the man-
agement of sustainable energy as an industry leader and is commit-
ted to gradually increase the share of renewables in its energy mix.
The company has already achieved 7% improvement in energy effi-
ciency between 2015–2020 in its Luxembourg headquarters and plans
to achieve more aggressive reduction within the next 5 years. SES is
transparent in data collection and data sharing and annually reports
to the Carbon Disclosure Project. The company pledges to comply
with the international regulatory standards, align with energy saving
programmes, and co-operate with the intra- and inter-industry actors
to generate positive value throughout its value chain on energy pro-
duction, consumption, supply and distribution.
SES works closely with the Luxembourgish institution ENOPRIMES
on the implementation of ISO50001 energy management system to
achieve energy efficiency in buildings through more efficient heating,
ventilating, and air conditioning systems. As a result of this initiative,
in 2020, SES has achieved annual reduction of 16.6 metric tonnes of
CO2e savings.
LOOKING AHEAD
As part of our strategy development, SES embarked on a GHG gap
analysis, in coordination with environmental consulting company, Eco-
Act, to determine any areas where we needed to improve our report-
ing and to develop a roadmap for meeting our NetZero and SBTI tar-
gets. In this engagement we discovered a few key takeaways. The
first underscores the importance of life cycle assessments on our
products and services to accurately understand our impact on the
environment given the speciality of the space industry. We also have
found that we need to expand the boundary of our Scope 3 emissions
in the future to include the manufacturing of our satellites. This is
critical as we embark on our SBTi validation is also important to rec-
ognise as we work with our suppliers in the future.
SES has a mission of increasing its ties with its suppliers and custom-
ers to achieve more efficient production and consumption lines. While
doing these, SES places a special emphasis on obtaining a more sus-
tainable way of doing business. SES is aware that sustainable supply
chains and consumption lines will be crucial for the success of its
long-term NetZero targets. To achieve more robust sustainable pro-
duction and consumption targets, SES will be focused on the ways to
implement more robust assessment processes and monitoring tools
for its medium to long term targets.
As specified in our strategy, we will be looking at how we can addi-
tionally work with our customers on their environmental challenges
and how we can innovate in our products and services to better meet
the challenges of climate change. We believe that to do this we should
spend time in 2022 to conduct outreach to our customers and part-
ners to better understand their challenges, their areas of focus and
define ways where we can collectively make a difference.
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DIVERSITY AND INCLUSION (D&I)
GRI 405
managers and executives, starting with gender. We currently have 18% of
the roles at that level filled by women and would like to increase that by
50% over 5 years. As we develop our data for other dimensions of diver-
sity, we will create targets reflective of the diversity we are striving for in
the organization.
As SES, we believe that we can also help ensure access to our indus-
try for marginalised groups by encouraging change in the industry
through our supply chain, with our customers and by supporting
STEM and ICT education initiatives. In 2022, we will begin to develop
a sustainability rating and diversity programme to be used in our rela-
tionships with our suppliers and customers. This rating will help us
assess and acknowledge partners who share our values with regards
to a diverse workforce and overall sustainability initiatives. SES works
extensively with programmes to encourage STEM and ICT education.
Going forwards, we will expand our existing efforts with institutions
with which we can work to grow a diverse future workforce. In line
with previous years, we will be further developing ways to reach
under-represented groups in partnership with educational institutions
and through our own scholarship and internal programmes.
In 2022, we will continue our work to enhance the way we measure
diversity in SES, to better capture other dimensions such as ethnicity,
as well as introducing an inclusion metric.
A few of our aspirational targets are:
Increase gender diversity of people managers and
executives in the business by 50% in 5 years.
By 2025, We aim to develop and implement a supplier and
customer sustainability rating and diversity programme
to empower a diverse pool of sustainable suppliers.
Make the space industry more diverse, equitable,
and inclusive, starting with SES.
Build a more diverse, equitable, and inclusive work-
force across all levels of our business.
Increase the diversity, equity, and inclusion of
the space industry through targeted actions and
investments.
As a company dedicated to connecting more people with more con-
tent across the globe, we believe our story should reflect those of the
millions we serve. We are committed to increasing the number of
employees from underrepresented groups and nurturing an inclusive
company culture to create a fair, innovative, and supportive working
environment where people can flourish – empowering all employees,
or “SESers”, to write their stories and to contribute to the collective
success of a truly global team. It’s not about quota, it’s about forging
a future that is equitable. In SES, we have placed a greater focus on
D&I over the last two years and we are seeing a positive difference in
our organization through engagement with our employees. Through
engaging with both internal and external stakeholders, it also became
clear that more ambitious targets in this area must be set to drive
change and transparency, not only in our workforce, but also as a
leader in our industry when it comes to a more inclusive and diverse
work environment. At SES, Diversity & Inclusion is about creating an
environment where any person is welcome to work with SES regard-
less of gender, gender identity, age, background, ethnicity, ability,
stage in life, sexual orientation, etc. We recognise that, at this moment,
we are limited in measuring diversity at a global level mainly through
the gender dimension.
TARGETS
SES recognises that within our workforce, we need to strive for more diver-
sity & inclusion across the business. We have put in place several pro-
grammes to increase awareness around Diversity and Inclusion such as
trainings and education initiatives (we have several D&I sessions through-
out the year), a Mentorship Programme, Diversity calendar, Equality and
Inclusion working groups and we are looking into creating an Allyship Pro-
gramme for the gender minority in 2022. We also want to help increase
the advancement of underrepresented groups across multiple diverse
criteria and will be developing additional metrics capturing other dimen-
sions of diversity. We want to tackle the diversity at the level of our people
DIVERSITY & INCLUSION
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ANNUAL
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ADDITIONAL
INFORMATION
In 2022, SES will develop a plan to build on our STEM and
ICT outreach in order to expand our impact on students
from underrepresented groups.
BUILDING A DIVERSE AND INCLUSIVE
WORKFORCE
SES is committed to increasing the number of employees from under-
represented groups and nurturing an inclusive company culture to
create a fair, innovative and supporting working environment. SES
puts diversity and equal opportunity at the centre of its employment
strategy and is a signatory of the Diversity charter in Luxembourg.
Supportive practices, such as implementing a D&I dashboard to mon-
itor their progression and our mentorship programme are systemat-
ically applied to support female talent and we are fully focused on
increasing the percentage of women within the SES workforce, both
overall and at managerial / executive levels. We believe that the meas-
ures we continue to take to support women help not only women but
lead to creating an environment in which all SESers feel included,
regardless of gender, gender identity, sexual orientation, ethnicity,
religion, etc.
DRIVING DIVERSITY
At SES, we greatly value employee ideas and we believe that increas-
ing employee engagement and representation of the workforce are
crucial elements to drive Diversity and Inclusion and boost innovation.
Across our operations, we implement different sets of programmatic
initiatives, from training and development programmes to a more
diverse and inclusive employment policy.
DIVERSITY AND INCLUSION TRAININGS
With Diversity and Inclusion strongly embedded as one of the 4 key
pillars of SES’ ESG strategy we are supporting everyone in making
steps towards a more inclusive future for SES. This future begins with
greater awareness within the company, which is why SES strongly
SES employees by function
SES employees by gender
SES employees by region
SES employees by age
686
Technology
(2020: 655)
491
Global Services
(2020: 448)
436
Corporate
Functions
(2020: 401)
318
SES Network
(2020: 308)
203
SES Video
(2020: 206)
1,570
Male
(2020: 1,598)
489
Female
(2020: 515)
23
1% Africa
1,152
56%
Europe
612
30%
North America
173
Middle East 8%
69
APAC, India 3%
30
Latin America 1%
632
41 to 50
462
51 to 60
657
31 to 40
234
30 and below
73
Over 60
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INFORMATION
encourages all employees to complete a short online Unconscious
Bias course, designed by Microsoft.
In order to move the needle on Diversity & Inclusion, the Unconscious
Bias training course is open to all employees and mandatory for all
people managers within the company – without exception. At the time
of publication of this report, more than 850 employees have com-
pleted the Unconscious Bias training and, in so doing, have demon-
strated their commitment towards a more inclusive SES.
THE POWER OF COMMUNITY STORYTELLING
Vibrant and respectful discussion across our international community,
whether on a 1-to-1 basis or via the intranet or other collaboration
platforms, is very much welcomed. As a company, we’re focused on
providing the connectivity to enable everyone, worldwide, to share
their story. Within our own community, sharing personal stories has
been a powerful way for employees to gain greater insights and aware-
ness of one another’s culture, experiences, and challenges. We are
convinced that the positive effects of collective knowledge, diverse
viewpoints and constructive co-creation will help us at SES to lever-
age our existing diversity to build an even more inclusive and diverse
company and create value for the company.
#IAMREMARKABLE
Feedback from SES employees has clearly shown the value of #IamRe-
markable, the global Google initiative that strives to empower everyone,
particularly women but also other underrepresented groups, to celebrate
their achievements in the workplace and beyond. At the heart of the
#IamRemarkable initiative is a 90-minute workshop that helps partici-
pants learn the importance of self-promotion in their personal and pro-
fessional life, equipping them with tools to develop this skill set, and invite
them to challenge the social perceptions surrounding self-promotion.
In 2021, 14 workshops, with 111 participants, took place and we are
proud to have 7 active facilitators from across our global locations.
In the recent Impact Report (54 responses at the time of publication
of this report), and as a direct result of the workshops, 52% of SES
employees are now more vocal about their achievements and 83% are
openly encouraging others to speak up more. In addition, for 65% of
the participants, the training has contributed to how they intend to
approach their Annual Appraisal.
EQUALITY AND INCLUSION WORKING GROUPS
For the past two years, members of the SES E&I groups have been
sharing experiences, exchanging ideas and developing policy and
strategic proposals for the organization to adopt real change in order
to drive greater workforce diversity.
In 2020, we launched our award-winning Equality & Inclusion working
groups. These groups, open to all employees and consisting of vol-
unteers, meet to develop proposals focused on Diversity and Inclu-
sion. The final proposals are later presented to senior management.
The E&I groups comprise one of the most important and valuable
Diversity and Inclusion initiatives for SES, with stakeholders ranging
from all internal employee groups, Senior Leadership Members,
Human Capital Team (Learning and Development, Recruitment, Tal-
ent Management, Compensation and Benefits), to Internal and Exter-
nal Communications, Brand and Marketing.
All departments are involved in the facilitation and implementation of
the proposals, aimed at enhancing impact for all employees.
In 2021, we began implementing company changes based on the out-
come of the 2020 E&I groups. Each group’s proposal was presented
and assessed by the Senior Leadership Team and implementation
was discussed with Human Capital.
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The approved proposals from the Equality and Inclusion Working
groups were implemented as follows:
• Aspirational Gender targets incorporated
• Diversity and Inclusion Dashboard implemented
• Implementation of the Diversity and Inclusion Dashboard
•
Maternity/Paternity/Partner/Adoption/Foster care leave harmo-
nised globally (12 weeks for mothers; 2 weeks for partners)
• More inclusive job descriptions implemented
• KPIs and metrics for female progression within SES implemented,
with a focus on People Manager and Executive positions; increased
focus on women candidates for internal hires
•
Focus on applications from women candidates for external job post-
ings (with emphasis on jobs of higher grades); internal reporting of
KPIs and metrics for women recruited in Job Grade 14
• “Walk in my shoes” communications initiative implemented in col-
laboration with Internal communications
Our 2021 groups focused on the following:
The Gender working group focused on achieving increased oppor-
tunities for all women or any person identifying as a woman inside
and outside SES. They developed an allyship for the gender minority
programme to implement in 2022.
The Ethnicity working group focused on stiving for better rep-
resentation and opportunities of ethnical minorities at all levels within
and outside SES. For their 2021 proposal, they tackled mitigating bias
in recruitment and in 2022 are challenging the organization to imple-
ment KPIs, apply blind screening and carry out interviewer surveys.
The “general” working group has flexibility to tackle other topics
and can choose a focus area. In 2021 the group focused on creating
an inclusive LGBTQIA+ culture within SES. They asked the business
to adopt the UN Standards of Conduct as our guidance and pushed
for increased visibility of support, training for employees, changes to
recruitment processes and advocacy through the addition of match-
ing donations in our company match programme.
In 2022, the work done by the E&I groups will move to the next stage,
namely, to implement all approved changes. Employees will be invited
to join the third rotation of E&I groups.
In 2021, SES was awarded the Luxembourg Diversity Award in the
category of Communication and Values for our employee-driven
Equality and Inclusion groups.
In addition to those initiatives, we have more D&I programmes in place
like a Diversity calendar, a Mentorship programme and a D&I dash-
board to monitor the progression of females especially in higher job
levels.
TALENT ACQUISITION
Diversity by the numbers
Currently 24% of SES’ workforce are women, a figure that has been
stable over the last years, but SES aims to increase this number as
part of its diversity strategy. Women are most present in Corporate
Functions (57%), specifically in Marketing and Communication (73%),
but considerably less in Technology & Global Services (13% & 15%).
Furthermore, 27% of SES employees below the age of 30 are female.
With a focus on increasing the representation of women in manage-
rial and executive roles in 2021. SES has observed a slight increase of
women representation at executive level (15% representation com-
pared to 13% in 2019 and 2020).
As of end-December 2021, SES employees from 68 nationalities across
24 offices which is a strong indication of the company’s diverse work-
force target. The most represented nationalities are: United States,
Germany, Israel, France, Great Britain, The Netherlands, Luxembourg,
Belgium, and Italy.
We have an overall healthy age distribution with an average age of
44 years old. 44% of our employees are aged 40 and below and
10% are aged 30 and below.
Below are presented new employee hires by SES by age group, gen-
der, and region in 2021.
New Hires by Gender
Total Female Male
Under 30 93 26 67
30–50 133 33 100
Over 50 29 4 25
Total 255 63 192
New Hires by Region (YTD)
5
Middle East 21%
157
63%
Europe
77
30%
North
America
6
Latin America 2%
5
Africa 2%
5
APAC, India 2%
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SES understands that valued employees are more likely to be satis-
fied with their career prospects, be productive and achieve their long-
term career goals. Engaged employees lead to a reduced chance of
employee turnover for companies. To achieve high skilled workforce
and increase productivity, SES puts a special emphasis on its secur-
ing and retaining talent policies.
When it comes to the retention, engagement, and development of
women, we are tracking the participation of women in key programmes
and initiatives, such as SES’ Leadership Development Programme,
where in 2021 29% of participants were women. When it comes to pro-
motions which took place in 2021, 28% of these were for women.
While our annualised turnover rate (15%) has remained stable in 2021
compared to 2020 and 2019, we have noticed a higher female turno-
ver (18%) than in 2020 (15%) and compared to male turnover (14%).
We acknowledge that this is a global trend reported by many, such as
in the 2021 McKinsey report titled “Women in the Workplace”:
“
One in three women says they have considered down-
shifting their careers or leaving the workforce this year,
compared to 1 in 4 who said this a few months into the
pandemic. Additionally, 4 in 10 women have considered
leaving their company or switching jobs – and high
employee turnover in recent months suggests that many
of them are following through.”
At SES we are closely monitoring the evolution of this phenomenon
through our D&I Dashboard while reviewing main reasons which drive
women’s departure based on data from exit interviews which helps to
guide and focus our future actions.
As a company, we adapt to the new way of working by creating a
hybrid model that provides more flexibility than before. We are also
in constant collaboration with our people managers to create safe
spaces and team charters that take every team member’s needs into
consideration.
In-house talent acquisition programme
In 2018, SES has created a new global in-house Talent Acquisition
function with dedicated personnel and developed a new Strategic
Plan aligned to business imperatives. In 2021, we filled 382 positions
(2020: 302) of which 70% were filled externally (2020: 66%). 59%
of the positions were filled in Europe (2020: 47%), and 35% in
North America (2020: 34%). 24% of positions were filled by women
(2020: 23%).
Our Talent Acquisition team focused on Diversity and Inclusion during
career and job fairs. SES joins events such as Jobinars for Top Women
Tech to attract more women from STEM. Additionally, we attended
the Aerospace Diversity Day (DELFT), all to attract more females and
showcase our commitment to D&I..
SES associate programme
To maintain our position as the leader in global content connectivity
solutions, we have established a special development programme for
graduates to provide us with a pipeline of young talent.
The SES Associate Programme has two tracks, a Sales Associate
programme and a Technical Associate programme. The Technical
Associate programme gives exposure to corporate functions in the
business over a 2-year period. We have active participants in this
programme that contribute to company projects, learn from business
leaders and gain deep insight into the satellite industry. The Sales
Associate programme, new in 2020, exposes the participant to
elements of sales (Solutions engineering, Asset management, and
Sales) over a 1.5-year time frame. The application process for this
programme launched in Q4 2020 and we had 5 new associates joining
us in Spring 2021.
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INDUSTRY COLLABORATION COMMITMENTS
Industry collaboration on enhanced Diversity and Inclusion policies
are keys to achieve more representative, inclusive, and dynamic work-
forces. More diverse and inclusive industries not only push underper-
forming companies to take more ambitious steps on their policies but
also create collective action platforms to better align intra-industry
targets to achieve enhanced Diversity and Inclusion. SES intends to
spearhead their policies in the space and telecommunication indus-
tries through its industry collaboration commitments.
WOMEN IN AEROSPACE
Women in Aerospace (WIA) is an international organisation founded
in 1985 dedicated to increasing the leadership capabilities and visi-
bility of women in the aerospace and STEM community. WIA acknowl-
edges and promotes innovative individuals who strive to advance the
aerospace industry. WIA-Europe currently has 14 Local Groups across
Europe and has also become partner of an important project in col-
laboration with the United Nations Office for Outer Space Affair
(UNOOSA), “Space for Women”.
SES is a corporate member and sponsor of WIA Europe, and 2 employ-
ees currently run the Luxembourg local group. The idea behind SES
participating in the WIA is to create a community in Luxembourg for
Women within the aerospace/STEM sector through regular meetings
(fun networking sessions, webinars, feedback sessions). SES aims to
enable women in the aerospace industry to have their voices heard
and have a great network of women in STEM that they can always
rely on. SES encourages having a platform for women in STEM to
share their ideas, discuss issues and eventually implement change
within the industry and promote women in STEM for the future gen-
erations.
STEM EDUCATION INITIATIVES
To secure best in class employees and to sustain innovative capabil-
ities, SES believes that it must inspire the new generation towards
Science, Technology, Engineering and Mathematics (STEM). There-
fore, we engage in global activities in this field also using it as oppor-
tunity to support and increase diversity.
MASSACHUSETTS INSTITUTE OF TECHNOLOGY
(MIT)
With MIT we have had some engagement over the past years for
STEM initiatives, we started in 2018, specially prior to COVID-19.
Before COVID one of our female colleagues organised two events in
MIT with our CTO at the time, and afterwards with other SES col-
leagues who participated in an event and explained how it is to be
working at SES.
SPACE & SATELLITE PROFESSIONALS INTERNA-
TIONAL (SSPI)
We collaborate with SSPI in Mid-Atlantic with one female employee
on the board. This employee participated in an event in George Wash-
ington University in DC, providing young women engineers her per-
spective on working on a male dominated industry, explaining her
experience at SES.
AEROSPACE DIVERSITY DAY AT TU DELFT
Over the past 2 years we have participated as speakers at the event.
The topic of 2021 was “Belonging as a basis” and we participated in
a panel discussion that was live for all TU Delft students.
SCHOLARSHIPS
Launched in 2018, The SES Space Scholarship offers a unique oppor-
tunity for 17–18-year-old students who have completed their General
Certificate of Secondary Education (GCSEs) and are interested in the
space industry and astronomy to be involved in a wide range of career
opportunities in the space industry. SES encourages people from all
background to apply and particularly welcomes applications from
underrepresented groups.
INTERNATIONAL SPACE UNIVERSITY
SES is a proud partner of the International Space University (ISU) in
developing future leaders of the world space community. We work
with the University in developing talent through guest lectures or
workshops from SES subject matter experts, professional visits,
internship opportunities and even scholarships to cover partial or full
tuition fees. Our scholarship this year benefitted a female student
from Algeria with 50% of her required tuition fees. We are tremen-
dously proud to be able to create possibilities for more accessible
space industry education and help young talents achieve their
dreams.
ENGINEERING TRAINEE DAYS
Engineering Trainee Days project aims to promote engineering and
scientific professions to secondary students, age 16+ years, by offer-
ing them valuable insights into the daily work environment of a STEM
professional. This experience differs from a simple company visit, as
the students follow and assist engineers and scientists in their daily
tasks and duties for two days. This allows students to gain an under-
standing of professional, linguistic, and interpersonal industry require-
ments. This project is an initiative of the Association of Engineers,
Architects, Scientists Industrials Luxembourg (da Vinci) and Jonk
Entrepreneuren Luxembourg with the support of the Ministry of
Education.
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CRITICAL HUMAN NEEDS
Reliable, high-speed connectivity and access to content is key to har-
ness the potential of digitisation, to boost countries’ economies, and
to present opportunities for people. SES’ superpower is reach bring
access to information and learning, improving digital inclusion through
reliable and flexible bandwidth anywhere on earth. SES progresses its
initiatives across geographical barriers, brings infrastructure to frag-
ile economies and isolated communities, and aids humanitarian efforts
in disaster-hit areas. Each country has unique challenges and oppor-
tunities around the move towards digital and SES is at the forefront
of this transformation.
TARGETS
SES is proud of the areas where we advance the Sustainable Devel-
opment Goals and know that access to content and connectivity is a
powerful tool to meet the needs of people for a sustainable, equitable
and inclusive world. Everyday our services connect communities with
content and critical connectivity for human needs. While we have sev-
eral programmes that we work on that advance these goals, the prob-
lems remain- billions of people are unconnected leading to worse
outcomes on a variety of metrics including access to education and
health. We believe our products and services are making a difference,
but we lack the metrics on the impact of these services for people on
the ground. We additionally want to make a meaningful impact with
connectivity and content but want to do this in close collaboration
with all the stakeholders- governments, global institutions, NGOs, con-
tent providers, our customers, and partners. For our targets and focus
for 2022, we are committing to doing the work to develop a long-term
goal for addressing critical human needs. To do that, we are going to
reach out to stakeholders and have meaningful conversations to know
what we can uniquely contribute that could help. In the meantime,
we will continue to do what we can through our existing programmes
of connecting unconnected areas, assisting in disaster response pro-
grammes, and providing telemedicine solutions.
ADDRESSING THE DIGITAL DIVIDE
Access to broadband services is a well-known indicator of a thriving
community as it provides for critical human needs of a population
including emergency aide, health, financial and educational access.
SES works alongside governments, telecommunications providers,
and non-governmental organisations in communities around the
globe to close the digital divide and build out infrastructure to con-
nect the unconnected. This is a core part of our fixed networks and
government business units and provides maximum impact in our
product and services portfolio. As part of our service portfolio, we
offer a Managed backhaul solution to our customers, providing sat-
ellite capacity for mobile base stations to connect additional subscrib-
ers in remote and isolated places. We work closely with our telecom-
munications customers to expand their networks to expand
connectivity to more people and close the digital divide.
Our services reach remote and isolated places to provide connectiv-
ity in Colombia (in collaboration with our partner INRED), Alaska (in
collaboration with Optimera), Greenland (with Tusass), and in 2021,
we worked with customers in Central African Republic on solutions
that reach remote and isolated places.
CENTRAL AFRICAN REPUBLIC
Utilizing SES’ MEO O3b service and working with Orange, this next
gen system will open the door to ultra-high capacity and flexibility to
provide tailored connectivity solutions to even the smallest and most
isolated towns in the Central African Republic.
While we know that we are connecting communities with broadband
service every day, SES wants to do more to innovate solutions and
expand access to these services. Addressing innovation and partner-
ship impact will be included in our stakeholder outreach in 2022.
Empower communities to thrive with services that
help meet critical needs, save lives, & create inclusive
and equitable opportunities.
Direct our innovation & partnerships to expand access
to educational, health, & informational services.
Expand reliable access to content & connectivity in
remote & isolated places by leading partnerships in
our industry and beyond.
CRITICAL HUMAN NEEDS
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INNOVATING FOR CRITICAL NEEDS
HUMANITARIAN RESPONSE
The COVID-19 pandemic has drastically increased the need for global
humanitarian assistance. The number of people requiring humanitar-
ian assistance has increased approximately 40% in 2021. Crises, con-
flicts, natural disasters, and the climate change impacts further
threaten the future of humanitarian response and increase the com-
plexity of the problems faced. To obtain a more robust humanitarian
policy adapting to constantly evolving humanitarian problems and to
contribute to a greater humanitarian good, SES continuously improves
its humanitarian response putting a special emphasis on innovation.
EMERGENCY.LU UPDATE
In 2021, we continued our public private partnerships related to dis-
aster and humanitarian response as we know that during disasters
communications becomes a critical need to response and recovery
of a community. In 2021, SES focused heavily on innovating for
humanitarian response and our public/private partnership between
the Luxembourg’s Ministry of Foreign Affairs, SES, HITEC Luxembourg
and the Luxembourg Air Ambulance, and is supported by several
operational and technical partners. We supported several deploy-
ments and announced our continued support of this programme for
another 6 years. SES Supporting disaster and humanitarian crisis sit-
uations remains a top priority of our ESG strategy.
There are two vital requirements in emergency situations: rapid
deployment on site to cover the communications needs in the imme-
diate aftermath of a disaster, and control and management capability
allowing quick and efficient sharing of information about the situation
on site. The emergency.lu platform was designed in 2012 to quickly
re-establish communications in remote areas isolated by natural dis-
asters or other emergency situations. The platform is based on a pub-
lic-private partnership between Luxembourg’s Ministry of Foreign
Affairs, SES, HITEC Luxembourg and the Luxembourg Air Ambulance,
and is supported by several operational and technical partners. The
emergency.lu platform is based on a global hub infrastructure and
satellite capacity, both provided by SES. Hubs are deployed in Betzdorf
(Luxembourg), Manassas (USA) and Hong Kong (PRC).
In 2021, emergency.lu project was renewed with SES for a period of
6 years. SES has moved the programme to a flexible service catalogue
approach, offering additional services and enhancements as options
for deployments and to better serve the needs of the customers on
the ground. Changes to satellite capacity, equipment, networking
options and enhanced options for voice services to affected commu-
nities has been developed or implemented.
The emergency.lu team were proud to support emergency missions
in 2021 including deployments to Haiti and Germany with additional
longer-term deployments continuing in Niger, Nigeria, Venezuela,
Syria, Chad, and Central African Republic in support of WFP, UNHCR
and UNICEF.
SATMED
SES has been managing the Luxembourg Government’s satellite-
enabled SATMED e-health platform, working in close partnership with
non-governmental organizations. The solution enables real-time sit-
uational assessment and data exchange for healthcare professional
sin locations like Bangladesh, Sierra Leone and others.
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OPERATING OUR BUSINESS
Along with setting a clear strategy and targets related to ESG for our
business, we also know that the foundation of our business needs to
be set on strong operating procedures and business ethics. Atten-
tion to our customer feedback, employee matters, social matters, IT
security process, Human rights considerations and Anti-bribery and
corruption are all additional areas where SES considers our impact.
Our commitment to excellence as a company has earned us recogni-
tion as a leader.
CUSTOMER CENTRICITY
SES emphasises doing the extraordinary in space to deliver amazing
experiences everywhere on earth. Delivering amazing experiences
everywhere on earth requires focusing on our engagement with cus-
tomers, on the people we impact as a top priority on SES’ business
agenda. To make sure SES understands the customer challenges,
expectations and improvement potential for SES, the company con-
ducts a ‘voice of the customer’ survey once a year. The survey is based
on quantitative methods and aims to measure the following:
• CSAT (Customer Satisfaction)
• CES (Customer Effort Score)
• NPS (Net Promotor Score)
Our customer experience team analyses the results from a quantita-
tive perspective and cross references the results with qualitative stud-
ies run throughout the year to get a holistic picture on the perception
of SES, customer challenges, expectations and improvement potential
for SES.
In 2021, SES received additional recognition for our work with our
customers from the European Customer Centricity Awards and the
International Customer Centricity Awards.
Networks KPIs
Video KPIs
EUROPEAN CUSTOMER CENTRICITY AWARDS
Business Change or Transformation: where we presented how we
apply customer experience to support business transformation, start-
ing with HEARTBEAT and later linking it into Simplify & Amplify and
all other transformational initiatives and programmes.
Customer Centricity in B2B: where we showed how we expanded
our CX capabilities with human centric design and we use design
thinking workshops to ideate CX improvements in a highly inclusive
cross-functional structure.
Winning these 2 awards reinforces the fact that our strategy for cus-
tomer centricity is the right one, it is impactful and driving change.
INTERNATIONAL CUSTOMER CENTRICITY
AWARDS
• Gold in Business Change and Transformation – Telecoms
• Silver in CX Leader of the Year recognizing our VP of Global
Customer Experience
• Bronze in Customer Centric Culture – Telecoms and Utilities
These 3 awards confirm that we are in a continuous cycle, an infinite
loop, where we build on our strategy to ensure that it keeps on deliv-
ering value and staying relevant to our customers and organization.
In 2022, SES is hoping to further align with our customers on ESG
topics with a dedicated portion of our Customer Advisory Board dis-
cussing these topics and how we can collectively create impact.
24.9 4.25.5
NPS CSAT
CES
1.0 5.01.0 7.0-100 100
44.5 4.45.9
-100
NPS CSATCES
100 1.0 5.01.0 7.0
SES ANNUAL REPORT 202149
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
EMPLOYEE MATTERS
We are passionate about employee experience and employee success.
We aim to treat employees as we want them to treat our customers;
empower them to take ownership of their careers; and create a com-
munity where it is fun to work.
We strive to be future proof, powered by a strong, healthy culture.
This depends on learning and teaching, a diverse workplace where
everyone feels included and having a growth mindset.
We drive business success within SES by anticipating and meeting
the needs of the business through world-class human capital
practices.
COVID-19
The pandemic continues to be a driving force in how we think about
work and our workforce. In 2021, SES continued relying on our COVID-
19 task force to ensure the health and safety of our staff and provide
regular updates to the changes in the regions where we work. Like
many businesses, the pandemic has allowed us to reflect on the ways
in which we work, how we collaborate with each other and how we
work might look in the future. SES has since instituted a work from
home option, allowing staff to work 2 days a week from their home
office. We believe that having a combination of in person and remote
working is the right balance for our workforce to allow for maximum
collaboration in our offices and the flexibility and productivity of work-
ing from home.
ATTRACTIVE AND FAIR COMPENSATION AND
BENEFITS
Our compensation philosophy aims to stay ahead of the market and
to contribute to the company’s organisational goal to attract, develop
and retain talent and to treat all employees in a fair and equitable
manner.
Key Principles
We benchmark our total compensation against local practices of other
global organisations with the ICT industry as a reference point.
Our total rewards include annual base pay, bonus linked to individual,
departmental and group financial targets, benefits aligned with local
practices as well as long-term incentives in order to position the
Company as a global employer of choice.
Being fair and consistent is at the heart of all our compensation &
benefits related decisions, whether it is on job grading, salary
increases, promotions or benefits. We undergo a global gender pay
gap analysis on an annual basis.
Our Employee Rewards & Recognition Programme celebrates achieve-
ments through either:
•
CEO Award- recognition on a company level for special efforts
related to key projects.
• Management spot awards- monetary bonuses as recognition for
great work.
• Peer recognition through “Thank You letters” and “Dinner on us”
Modern working conditions
Working conditions are being increasingly influenced by working
hours, workplaces, the work environment, the level of employee
empowerment and a state-of-the-art, growth driven management
culture.
The length of our employees’ workweek is generally regulated by the
company or by a collective bargaining agreement.
Today’s living and working conditions require working times to be
flexibly organised in accordance with individual needs. We help
employees reconcile their professional and personal responsibilities
and boost their flexibility and self-determination by giving them the
opportunity for mobile working. With COVID-19 forcing most of us to
work from home, we adapted conditions and flexible working to
accommodate the safety and needs of our employees. We success-
fully deployed IT solutions to accommodate the increased work from
home demand and gave regular updates to our employee offices on
the local COVID-19 situation and company regulations.
Further options for flexible working today include job sharing, part-
time work, phased return from leave and reduction in work time.
SES ANNUAL REPORT 202150
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
HEALTH AND SAFETY
GRI 403
SES commits its support to its employees’ well-being and safety in
and outside of the workplace. SES ensures health and safety through
risk identification, assessment, and monitoring; health and safety
trainings; on-site and off-site regulation and supervision; and health
and well-being initiatives. In 2021, SES instituted a role dedicated to
ensuring a fully coordinated and structured approach across the
organization. The Global Health and Safety officer is responsible for
devising a global Occupational Health and Safety strategy based on
international standards and for managing its consistent implementa-
tion worldwide.
The company complies with the ISO45001 principles and in 2022, will
continue to develop this system to disclose additional metrics asso-
ciated with our Health and safety policies. The company has put in
place different risk assessments based on the local regulations of its
sites. Regulatory watch and legal compliance are monitored and
defined based on the different sites. All personnel working at SES is
covered by this framework. SES proudly reports that the company did
not report any work-related injury or ill-health thanks to its compre-
hensive and preventive health and safety policies.
TRAINING AND EDUCATION
GRI 404
We are convinced that work can and should provide a great opportu-
nity to learn and grow, as well as to contribute to our societies at large.
SES offers relevant training and development to all its employees and
aims to provide learning that is easily accessible as a natural part of
an employee’s job. The mission of the Learning & Development func-
tion in any organisation could be described as ensuring the availabil-
ity of relevant learning solutions to all its members. Our vision for
Learning & Development goes much further and is currently defined
as follows: to create an environment where fully remote state-of-the-
art learning is easily accessible to all employees, where learning any-
time/anywhere is a natural part of everyone’s job, and where develop-
ing skills is recognised as a shared responsibility. Already before the
pandemic our slogan was to promote “Learning anytime, anywhere”
since our employee population is spread out across over 25 locations
globally. Concretely this translated into having either an e-learning
solution or a remote-delivery videoconference version available as an
alternative to any training offered in a classroom. This allowed us to
create more of a level-playing field between employees located in the
major offices and those in smaller locations. When the first lockdowns
started in March 2020 we were able to build on these efforts and
quickly moved our complete active training offering to remote deliv-
ery formats, so that during both 2020 and 2021 the time and effort
spent on learning actually increased versus previous years, rather
than suffering from the pandemic.
The following graph shows the official numbers for all trainings
for 2018 through 2021
(Disclosure 404-1 Average hours of training per year per employee)
All trainings 2021 by the numbers
Total Participations Total Hours
For 2021, we had defined the following priorities in Learning and
Development:
• Organise tailored learning journeys for teams to fight isolation and
impact of lockdowns: topic-based or pure teambuilding, sponsored
by people manager
• Continue company-wide Business Priority Sessions to create visi-
bility on key topics such as Working from Home, Artificial Intelli-
gence, Cloud
2021202020192018
8.160
16.849
9.177
14.738
14.260
28.887
13.400
29.451
SES ANNUAL REPORT 202151
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
•
Make the “4 Essential Roles” the accepted and lived SES leadership
model: partner with top management to ensure relevance and
impact, start at the top
•
Develop SES leadership pool to increase employee engagement:
leverage Leadership Development Programme, Associate Pro-
gramme and Practical Manager Toolbox
• Provide weekly 90-minute career skills / well-being sessions: wide
range of topics, internal delivery, “come as you are”
•
Reinvent Induction Days: offer an engaging induction experience to
SES new joiners “with a buzz around it” in spite of remote conditions
•
Enterprise Skills Initiative (ESI) in partnership with Microsoft to
enable employees to systematically upskill in key areas
•
Improve consistency regarding training compliance on a number
of mandatory topics in Legal/Regulatory as well as IT
Specifically related to ESG topics, SES has designed an SDG-ESG
training workshop in 2021 for roll-out in 2022 to increase employee
awareness of the UN SDGs and ESG principles. The workshop covers
the why and the how SES is incorporating ESG in the organization
with the aim to increase employee engagement in this area.
Traditionally trainings at SES are managed through a Learning Man-
agement System (LMS) which enables employees to search and sign
up for relevant courses, and to complete all hosted e-learnings. The
LMS also serves for tracking attendance and maintaining training
records. Over the past few years and especially since March 2020,
SES has used a number of new formats for delivering learning expe-
riences to employees in an easily accessible way, including some that
do not allow easy integration with our LMS (e.g. videoconference ses-
sions in TEAMS and company-wide videoconferences on our internal
platform). The result of our decision to favor ease-of-access over
detailed reporting capability has been that a large part of the learn-
ing now happens outside the LMS, and while we are able to track and
trace the participant numbers as well as the learning hours, this puts
a limit on our ability to produce a full detailed report on the learning
activities for different employee categories. The following numbers
therefore only capture the part of the learning tracked in the LMS.
Learning activity by gender and age groups:
(GRI Disclosure 404-1 Average hours of training per year per
employee category)
Learning activity by Gender
By
Hours
By
Participations
% of employee
population
Women 28% 25% 25%
Male 72% 75% 75%
According to the data we have, participation in trainings is perfectly
in line with the gender composition of our workforce. In terms of train-
ing hours, women are slightly ahead of men.
Learning activity by Age groups
By
Hours
By
Participations
% of employee
population
Under 30 15% 15% 12%
30–50 64% 64% 62%
Over 50 21% 21% 26%
According to the data we have, the percentage distribution across
the three age groups by hours is identical to that by participations.
The under 30 group consumes slightly more on average, the over 50
a bit less, compared to their % of the employee population.
Functional and technical training
(GRI Disclosure 404-2 Programmes for upgrading employee skills and
transition)
Learning activities regarding employee skills at SES can be triggered
either top-down (launched by management) or bottom-up (requested
or initiated by the employee). Our key principles for managing these
efforts and allocating the budget are as follows:
•
Everyone in the company has access to the SES&Me Learning page,
as we are running L&D as a shared service.
• Everyone in the company can in principle sign up for course in the
SES learning calendar – classroom, remote, internal e-learning, or
MOOC (external e-learnings).
•
Everything in the Learning calendar is paid for from the central L&D
budget, no back-charging is done to the participants department
or cost centre.
• Any manager can assign any training in the catalogue to someone
in their team via the SES&Me Learning page.
• Before attending external trainings, employees submit an “external
request” in the SES&Me Learning page, approval is required from
line manager and from L&D to allocate the budget.
• External trainings and events organised for a specific department
or team are charged to that areas functional training budget.
• Tuition assistance for graduate or post-graduate studies is availa-
ble under certain conditions, but NOT a pre-approved entitlement.
SES ANNUAL REPORT 202152
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
ENTERPRISE SKILLS INITIATIVE
CHALLENGE (ESI)
In 2021, SES has partnered with Microsoft to launch Enterprise Skills
Initiative (ESI) to equip SES employees with necessary IT skills
through provision of training courses on Microsoft Cloud Solutions.
The courses are guided, interactive and allow employees to learn the
material in-depth at their own pace. Microsoft certifications allow SES
employees to advance in their careers through enhanced skillsets at
SES or elsewhere.
MANDATORY TRAININGS REGARDING LEGAL,
REGULATORY AND IT
SES employees are required to complete seven mandatory trainings:
General Data Protection Regulation (GDPR), Code of Conduct, Har-
assment Prevention, IT Security Awareness Foundations, Sanctions,
Anti-Bribery, and Export Compliance. Because of the relevance of
these topics for ESG, we are providing a brief description of each of
them here.
GDPR
In light of the General Data Protection Regulation (GDPR) across
Europe, all SES employees are required to take an internal GDPR
e-learning course to ensure colleagues are aware of, and compliant
with, this important new data protection legislation.
CODE OF CONDUCT
The Code of Conduct e-learning is designed to create a thorough
understanding of the key principles of our Code and also outline the
process for reporting and potential violation of it. Adherence to our
Code of Conduct and Ethics is vital for preserving the good reputa-
tion of our company, which is one of SES’s most valuable assets. A
major effort has been made to “translate” the code into language that
resonates with our employees.
HARASSMENT PREVENTION
Our organisation’s commitment to Diversity & Inclusion means that
every employee must understand the policies, procedures, and guide-
lines as outlined in the Fair Employment Practices of the SES Code
of Conduct. To deliver on this, The Harassment Prevention e-Learn-
ing course is mandatory. The two-hour course reflects the standards
of conduct that SES expects from all its staff everywhere.
IT SECURITY AWARENESS FOUNDATIONS
For the effective protection of the company and its assets, it is imper-
ative that all SES employees are aware of existing IT Security Aware-
ness risks and threats, allowing them to sustain the highest level of
vigilance at all times.
SANCTIONS
SES complies with all applicable sanction regulations. The SES Legal
Department maintains an internal chart of sanctioned countries and
employees need to be familiar with the relevant sanctions for every
country, reaching out for advice from the Legal Department before
engaging in any business that touches a sanctioned country, entity
or person. In order to familiarise the employees with these respective
rules, the Sanctions e-learning are mandatory for all SES employees.
ANTI-BRIBERY
To ensure that all SES employees comply with anti-bribery laws, it is
mandatory for all employees to complete the Anti-Bribery e-learning.
EXPORT COMPLIANCE
Employees at SES must be able to recognise when they are dealing
with hardware, software, technology/technical data or services sub-
ject to export controls. Understanding what obligations they have
when receiving, storing or transferring export-controlled hardware,
software or technology/technical data is mandatory for all employees
and covered in the Export Compliance training.
PERFORMANCE MANAGEMENT
GRI DISCLOSURE 404-3
SES uses an Annual Performance Review (APR) process to manage
and support employee performance, enabling managers to make more
accurate decisions on promotion, succession, compensation, and
employee evaluation. SES aims to drive employee development and
engagement, align employee’s work with business objectives and hold
employees accountable through continuous monitoring and feedback
loops. Upon employee performance evaluation, SES sets critical areas
of improvement and structures its learning and development initia-
tives accordingly, targeting both hard skills that are required by ICT
and space and telecommunications industries as well as soft skills
that enhance employee personal development.
SES ANNUAL REPORT 202153
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SOCIAL MATTERS
GIVING BACK TO OUR COMMUNITIES
GRI 413
SES know that “making a difference” includes not only the work our
company does through our products and services but also includes
all the ways the company and our employees give back to our com-
munities. From fundraising through the Global Giving Initiative to
increasing employee engagement through the Giving Back Days, SES
ensures that local community engagement and giving are embedded
in its company culture.
SES provides multiple routes for giving, some of which are corporate
led initiatives and others are led and organised by our employees.
CORPORATE LED INITIATIVES
GLOBAL GIVING
SES helps local communities by leveraging its Global community of
giving. SES’ individual offices can nominate organisations or commu-
nity opportunities that the entire SES population can support through
fundraising. The aim is to mobilise the SES community to give dona-
tions or time for a local charity rather than to define projects for giv-
ing “in kind” or other corporate initiatives. SES choses the target
organizations based on feasibility, overall impact, geographical dis-
persion, and levels of involvement offered (donations, volunteering,
fundraising, skills based virtual event, etc). Starting in Q2 of 2021, we
held quarterly projects to benefit a wide range of initiatives and
engage our employee base.
Singapore Red Cross
Benefitting the Singapore Red Cross, and mobilizing our entire
employee base, SES raised over 14,000 Singapore Dollars with an
additional 10,000 Singapore Dollars matched by the Singapore Gov-
ernment. Employees used remote fundraising opportunities, such as
offering yoga classes on Microsoft Teams, a tiny desk concert with
SES musicians, to virtual walks with their team to raise awareness and
make an impact together.
Clean up the World Day
In 2021, SES joined a global movement in September to “Clean up the
World”. Offices in 7 countries participated to clean up trash in our
communities and those who could not get out of the office that day
were encouraged to participate in a “digital clean up” of their devices
to reduce the impact of our digital footprint on the environment.
Giving Tuesday donation drive
In November, SESers took inspiration from the international Giving
Tuesday movement and 15 offices participated in a donation drive. In
total we donated over 200 clothing items benefiting 7 different char-
ities
EMPLOYEE MATCHING
SES matches every donation of its employees on dollar-for-dollar
basis (up to €1,000 per employee per year) and for the charities
approved in the beginning of each year.
SOCIAL FUND
The Social Fund is intended to provide financial support to staff mem-
bers and direct members of their families in case of unexpected social
emergency situations, for which staff members or members of their
families cannot be held responsible, which result in incommensurate
financial costs not covered by social security or third-party coverage,
and which lead to an unstable work or family situation. The purpose
of the Social Fund is to provide a financial security net. SES has pro-
vided an initial contribution of €50,000 to the fund in 2021.
SES ANNUAL REPORT 202154
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
EMPLOYEE LED INITIATIVES
GIVING BACK DAYS
SES grants its employees two days per year paid leave to ‘give back’
to a cause that is important to them. In 2021, our employees gave back
to volunteer to clean up in Germany after the damaging floods of the
summer, to cycle hundreds of kilometres to benefit a charity in the
Philippines, to help senior citizens in Singapore, or to lecture to a
group of space students at a marketing workshop. Additionally, our
employees used days to participate in our global giving initiatives to
fundraise for the Singapore Red Cross or Clean up the World.
SHARITY
SHARITY is an employee led charity designed to support small scale
local development projects globally, (examples include but not limited
to funding a local village school or medical centre). Employees fund
projects by donations and SES matches up to $1,000 per project. SES
chooses the projects to support based on projects’ ties to SES
employees or locations in which SES has offices; charities favouring
education & health, protection of children, protection of minorities,
women’s rights; environmental and sustainable development causes;
strict political and religious independence; traceability of the donated
funds; geographical diversity (local and global); and minimum man-
agement fees of the elected charities and projects.
In 2021, Sharity’s projects included supporting:
• Music Education for children in disadvantaged areas around Cape
Town
• COVID-19 impact in India
• Benefitting children and WWII veterans Ukraine
• Starvation in Madagascar
• Scholarship in Burkino Faso
• Support of Germany after flooding
Sharity collected a total of €7,600 excluding the SES match to donate
to the projects above.
ETHICS
Integrity, compliance, and legal responsibility are the cornerstones of
our sustainable governance and serve as the basis for all our actions.
Our governance objectives and their management are part of our cor-
porate governance system and are represented in the targets and
remuneration of our Directors and Executives. SES is committed to
conducting its business in compliance with all applicable laws and
regulations observing the highest standards of business ethics.
CODE OF CONDUCT
GRI 103-204
We define compliance as trust-based, reliable, and sustainable cor-
porate governance derived from ethical values. The Board of Direc-
tors is responsible for compliance with the law and the company’s
policies and seeks the same level of compliance from all SES subsid-
iaries and employees.
To manage and address compliance risk, we have implemented a
Compliance Committee and a Code of Conduct which defines our
everyday business conduct, offers employees advice, and helps them
make the right decisions even in difficult business situations. SES’
Code of Conduct explains that unethical behaviours are not accept-
able at SES and the potential sanctions for such behaviours. It
includes our stance on: Information and Cyber Security policies, Brib-
ery and Facilitation, Political Activities, Sanctions, Export Controls,
Competition/Antitrust, Anti-Money Laundering, Intellectual Privacy,
Antiboycott, Insider Trading, Conflicts of Interest, Fair Employment,
Harassment, Contractors and Agents, Data Protection, Fundamental
Rights, Environment, Health and Safety, Social Media, it is binding and
applies to all employees without discrimination.
Our Compliance Committee, composed of designated Compliance
Officers in each main corporate location, is tasked with raising the
staff’s awareness of the Code of Conduct. The Committee meets reg-
ularly to discuss important topics or issues. Reflecting the company’s
expansion into developing markets, the composition of the Commit-
SES ANNUAL REPORT 202155
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
tee includes representatives from SES’ offices in Asia, the Middle East,
and Latin America.
SES has implemented a mandatory compliance training programme
for staff as detailed in the training section of this report.
WHISTLE BLOWING SYSTEM
SES has implemented a whistleblowing hotline, managed by a third-
party provider, which allows our staff to file any compliance complaints
in full confidence. In addition to its internal ethical mechanism, SES
demands high ethical standards from its business partners and sup-
pliers to ensure trust with the external stakeholders including cus-
tomers, governments, and investors.
HUMAN RIGHTS
Respect for human rights is a natural prerequisite for responsible
business management at SES and we are committed to acting in
accordance with international initiatives and standards such as the
Fundamental Conventions of the International Labour Organisation,
the UN Universal Declaration of Human Rights and the UN Guiding
Principles on Business and Human Rights. We expect all employees
to be proactive in protecting human rights so that violations can be
ruled out entirely when it comes to our company’s business activities.
All forms of modern slavery, forced child labour, exploitation and dis-
crimination are explicitly prohibited by SES. SES will not do business
with any person or entity that engages in any form of modern slavery.
This is a value that is highlighted in our Code of Conduct and inserted
into legal documents with suppliers, partners, and customers. We do
not see any elevated risk of child or forced labour at any of our SES
locations or in our activities. SES was also not aware of any cases of
human rights violations within the scope of its own business activities
during the reporting period.
STATEMENT ON SLAVERY AND
HUMAN TRAFFICKING
SES is committed to ensuring that there is no modern slavery or
human trafficking in its supply chains or in any part of its business
and that it adheres to international initiatives and standards such as
the Fundamental Conventions of the International Labour Organisa-
tion, the UN Universal Declaration of Human Rights, and the UN Guid-
ing Principles on Business and Human Rights. SES will not support or
deal with any business knowingly involved in slavery or human traf-
ficking.
The nature of SES’ business means that the majority of SES’ suppli-
ers are large international companies providing complex technical
services relating to the space industry through highly skilled profes-
sional employees. Our 50 largest suppliers account for approximately
80% of procurement spending.
SES does not procure a material amount of goods or services in sec-
tors that are considered high risk for human trafficking or slavery
(such as agriculture or horticulture, construction, textiles, catering
and restaurants, domestic work, and entertainment).
SES Code of Conduct for Suppliers clearly outlines SES’ stance
towards slavery and human trafficking. SES also includes in its con-
tracts with suppliers a clause requiring the supplier to comply with
all laws applicable to the provision of the goods or service. SES’ con-
tracts with its suppliers also contain a provision stating its suppliers
cannot novate or subcontract any right or obligations to any third
party without the written consent of SES.
This statement is made pursuant to Section 54 of the Modern Slavery
Act 2015 of the UK and sets out the steps SES has taken to ensure
that slavery and human trafficking is not taking place in our supply
chains or in any part of our business.
SES ANNUAL REPORT 202156
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
ANTI-CORRUPTION/BRIBERY
GRI 204
SES is committed to respecting the highest ethical and legal stand-
ards, set out in our Code of Conduct, on which all our employees are
trained. We have identified bribery and corruption as one of the risks
that SES is facing by doing business in most countries around the
world, including with governments.
In addition to our Code of Conduct training, we require most employ-
ees to complete anti-bribery training on a regular basis. If initial ques-
tionnaires uncover concerns, SES will also conduct external due dili-
gence on our third-party agents. The level of this due diligence
depends on the risk assessment, which itself is based on several ele-
ments, including the country of operation and the type of business.
We also reduce the risk of bribery through a clear standard for pro-
viding or accepting gifts and entertainment and an approval process
for any gifts that exceed that standard. The relevant policy, which like
all compliance policies is available on a dedicated intranet page, con-
tains a dedicated e-mail address that can be used to obtain guidance
prior to providing or accepting a gift or entertainment.
CYBERSECURITY
GRI 418
The robust management of data protection and data security is
essential, in our opinion, to secure the long-term confidence of our
stakeholders.
To ensure compliance with data protection laws and regulations, SES
appointed a Data Protection Officer. SES has implemented a variety
of measures, has reviewed, updated, and enacted relevant procedures
and processes, and continuously strives to comply with the General
Data Protection Regulation (GDPR).
SES has implemented technical and organisational security measures
to protect networks and systems from cyber-attacks. As part of con-
tinual organisational improvement and in line with its commitment to
strengthening cyber security, management has introduced a security
framework in accordance with the leading industry standard ISO
27001 in key areas. This framework is continually adapted to new
threats considering global organizational changes, security controls
and practices within the group to reduce the risks of cyber-attacks.
Employee training and education is an important piece to maintain
security on our networks. SES has nearly 90% staff completion rate
of information security training.
As Covid-19 brought new ways of working, our operations team
evolved to ensure that our customers can continue to rely on us for
critical content delivery and connectivity services, we have imple-
mented and maintained a business continuity management system
in accordance with the ISO 22301-2019 international standard as well
as best practice guidelines from the International Organisation for
Standardisation and approved by the European Committee for Stand-
ardisation. While most staff have been working from home since mid-
March 2020, our operations teams have adopted a split team approach.
Our operations teams are continuing their work on rotating shifts
either using remote secure connections from home or operating reg-
ular services onsite. This ensures the delivery of uninterrupted broad-
casting services and seamless networks services 24/7.
We operate fully redundant and geographically agnostic Satellite
Operations and Networks Operations Centre systems to ensure the
seamless operations of our customer services and satellite fleets. Our
fully tested operational continuity plans ensure we have 100% confi-
dence that our teams can operate the satellites and support opera-
tions remotely should the need arise.
We have also set up a cross-functional COVID-19 team in 2020 that
continues to ensure the governance and proper execution of Pandemic
Emergency Readiness and Business Continuity plans. The team meets
with a clear remit to protect our staff and to ensure continuity of our
operations and delivery to customers.
SUPPLY CHAIN MANAGEMENT
The purchasing functions within SES are carefully managed by a ded-
icated Vendor Management and Procurement team. SES places great
emphasis on the design of its procurement processes, keeping in mind
the obligations to applicable laws as well as our responsibility for sus-
tainable practices. Our suppliers adhere to a Supplier Code of Con-
duct and Supplier General Terms and Conditions (GTCs) which out-
lines SES’ expectations with regards to insider trading, conflicts of
interest, bribery, sanctions, export compliance, competition, money
laundering, child labour and slavery and human trafficking.
In 2022, SES will be undergoing additional considerations for our sup-
ply chain to align to the ambitions of our ESG strategy in driving Diver-
sity and Inclusion, climate action and overall due diligence for sus-
tainable practices.
SES ANNUAL REPORT 202157
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
REPORTING STANDARDS APPENDIX
EU TAXONOMY
SES has undertaken an initial evaluation of its associated economic
activities against those identified by the EU Taxonomy as required by
the Delegated Act of Article 8 of the Taxonomy Regulation. Given the
nature of SES’ operations as a satellite operator, our GHG emission is
small, totalling not less than 37,000 tons of CO2e. Accordingly, SES
does not consider its activities to fall under the scope of those iden-
tified by the EU Taxonomy and/or are considered to be de minimis in
nature as it relates to the year ended 31 December 2021. SES will con-
tinue to review reporting of EU Taxonomy activities on an annual basis
in line with the requirements.
UN GLOBAL COMMUNICATIONS ON PROGRESS
SES endorsed the UN Global Compact (UNGC) in April 2021 and con-
tinues its support for the ten principles under human rights, labor,
environment and anti-corruption areas. This Communication of Pro-
gress renews our commitment to the initiative for the upcoming year
as we continue to advance our ESG strategy aligned with the UN
Global Compact and the UN SDGs.
This Communication on Progress (COP) is supplementary to our
Annual report that describes the company’s efforts to implement the
Ten Principles. SES supports public accountability and transparency,
and therefore commits to report on progress annually to the UN Global
Compact COP policy.
The table presented in the next part of the COP letter provides:
• A description of practical actions (i.e., disclosures of any relevant
policies, procedures, activities that the company has taken (or plans
to undertake) to implement the UN Global Compact principles in
each of the four issue areas (human rights, labour, environment,
anti-corruption.
• A measurement of outcomes (i.e., the degree to which targets/per-
formance indicators were met, or other qualitative or quantitative
measurement of results.
Steve Collar
CEO, SES S.A.
SES provides details on its ESG performance and impact through
quantitative and qualitative data provision to different sustainability
reporting initiatives. These reporting initiatives include Global Report-
ing Initiative, Sustainability Accounting Standards Board, United
Nations Global Compact – Communication on Progress, and Non-
Financial Reporting Directive. Through these initiatives, SES can pro-
vide an in-depth and transparent data to external stakeholders and
breakdown several aspects of its ESG policies that the Annual ESG
Report does not fully capture.
GRI INDEX
SES has structured this report in line with the GRI reporting stand-
ard. For a full index of disclosures, please follow this link to the
reporting section of our website. We are continuously improving
our reporting and are looking forward to expanding our disclosures
in future years.
SASB DISCLOSURES
SES has provided SASB disclosures on the reporting section of
our website. We have disclosed according to the “telecommunications
sector” and are evaluating if additional disclosures should be considered
in the following years.
SES ANNUAL REPORT 202158
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NON-FINANCIAL STATEMENT
The following information is provided in compliance with the Non-
Financial Reporting Directive requirements. The table below sets out
where the relevant information can be found in this Annual Report.
Non-financial Statement Disclosures in the relevant Chapters of the Report
Reporting Requirement Policies/Information Relevant Information GRI Index cross reference
Business Model
• Business Model ›› page 6
• Strategic Priorities ›› page 28
GRI 101, 102, 103 401, 405,
Environmental Matters • Environmental Policy
• Fleet Management and Lifecycle Management
• Carbon Disclosure Project
• Waste Management Policy
• Corporate Responsibility ›› page 73
• Ambitions and Purpose ›› page 5
• Climate Action ›› page 37
• Space Sustainability ›› page 34
GRI 102, 103, 302, 305, 306
Social Matters • Procurement Policy
• Giving Back Initiatives
• Disaster Relief Programmes
• Customer Heartbeat (satisfaction, voice) and Perception Studies
• Critical Human Needs ›› page 46
• Ambitions and Purpose ›› page 5
• Governance section ›› page 60
• Social Matters ›› page 53
GRI 102, 103, 413
Employee Matters • Health and Safety Policy
• Flexible Working Policy
• Social Fund Policy
• Training and Development
• Diversity
• Diversity and Inclusion ›› page 40
• Ambitions and Purpose ›› page 5
• Employee Matters ›› page 49
GRI 102, 103, 401, 403, 404, 405,
Human Rights • Vendor Policy / Supply Chain Policy
• Code of Conduct
• Human Rights Policy
• Ambitions and Purpose ›› page 5
• Governance section ›› page 60
• Corporate Governance / Chairman Report ›› page 61
• Ethics ›› page 54
GRI 102, 103
Anti-corruption and Bribery • Supplier Code of Conduct
• Group Wide Code of Conduct
• Whistleblowing Hotline
• Compliance Guidelines
• Ambitions and Purpose ›› page 5
• Corporate Governance ›› page 60
• Ethics ›› page 54
GRI 102, 103, 205
Principal Risks and impact from Business Operations • Shift in Consumer Trends
• Customer Dissatisfaction
• Liquidity Risks
• Regulatory Risks
• Principal Risks and Uncertainties ›› pages 78–81
• Governance section on Managing Risks ›› page 78
• Corporate Responsibility ›› page 73
• ESG ›› pages 30–58
Non-financial Key Performance Indicators • Employee Turnover, Diversity Ratio
• Employee Training
• Technical Reach and TV Channel Count
• Net Promotor Score
• CO
2
emissions
• Employee Matters ›› pages 30–58
• Operational and Strategic report >> page 20
• Operating our Business >> page 48
• Climate Action >>page 38
Corporate Governance
60 Shareholder structure
61 Chairman’s report
on Corporate Governance
63 Board of Directors & Committees
70 Senior Leadership Team (SLT)
73 Internal control procedures
78 Principal risks
Remuneration Report
82 The Remuneration policy
86 Remuneration report
CORPORATE
GOVERNANCE &
REMUNERATION
3
SES ANNUAL REPORT 202160
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
CORPORATE GOVERNANCE
SHAREHOLDER STRUCTURE
SES has been listed on the Luxembourg Stock Exchange since 1998
and on the Euronext Paris Stock Exchange since 2004.
Shareholder Structure as of 31 December 2021
SES Shareholders
Number of
Shares
Voting
participation
Economic
Participation
Registered shares 4,616,730 0.81% 1.00%
FDRs (free float) 359,092,441 65.86% 78.04%
FDRs held by SES 7,748,429 0.00% 1.68%
1
FDRs held by SES Astra for SES 12,000,000 0.00% 2.61%
2
Total A Shares 383,457,600 66.67% 83.33%
BCEE 60,614,724 10.88% 5.27%
SNCI 60,607,161 10.88% 5.27%
Etat du Luxembourg 64,506,915 11.58% 5.61%
B Shares held by SES Astra for SES 6,000,000 0.00% 0.52%
3
Total B Shares 191,728,800 33.33% 16.67%
Total shares (actual)
4
575,186,400 100.00% 100.00%
Total shares (economic)
4
460,149,120
1 At 31 December 2021, SES held 7,748,429 FDRs for the purpose of its employee option program. SES does not exercise voting rights.
2 At 31 December 2021, SES Astra on the basis of article 415-23 of the Luxembourg companies’ law, held 12,000,000 FDRs, to be cancelled in accordance with the programme of
6 May 2021. SES Astra does not exercise voting rights.
3 At 31 December 2021, SES Astra on the basis of article 415-23 of the Luxembourg companies’ law, held 6,000,000 B Shares, to be cancelled in accordance with the programme of
6 May 2021. SES Astra does not exercise voting rights.
4 Pro forma number of total shares (actual) will be 557,186,400 and total shares (economic) will be 445,749,120 post cancellation of shares held by SES Astra in accordance with the
programme of 6 May 2021.
The Company has issued two classes of shares: A-shares and
B-shares. Each share is entitled to one vote. One B-share carries 40%
of the economic rights of an A-share.
The ratio of A-shares to B-shares must be maintained at 2:1 as
required by the Articles of Incorporation.
A-SHARES
A-shares are held by private and institutional investors.
The listed security is the Fiduciary Depositary Receipt (“FDR”), listed
on the Luxembourg and Euronext Paris Stock Exchanges. Each of
these is backed by one A-share and has all the rights attached to that
share, except the right of attending the general meetings of share-
holders.
In order to attend a general meeting, at least one registered share must
be held. Voting rights may be exercised by notifying the Fiduciary
(Banque et Caisse d’Epargne de l’Etat) of the voting intention.
B-SHARES
The State of Luxembourg holds a direct 11.58% voting interest in the
company. Banque et Caisse d’Epargne de l’Etat and Société Nationale
de Crédit et d’Investissement each hold a direct 10.88% voting inter-
est in the Company. These shares constitute the Company’s B-shares.
A B-share has 40% of the economic rights of an A-share or, in case
the Company is dissolved, is entitled to 40% of the net liquidation
proceeds paid to A-shareholders. The B-shares are not listed on any
exchange and do not back a tradable security.
SES ANNUAL REPORT 202161
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
CHAIRMAN’S REPORT ON
CORPORATE GOVERNANCE
The Company follows the ‘Ten Principles of Corporate Governance’
adopted by the
Luxembourg Stock Exchange (its home market),
as last revised in December 2017. SES meets all the recommendations
made by the ‘Ten Principles’.
SES also complies with the governance rules for companies listed in
Paris, where the majority of the trading in SES FDRs takes place. In
the instance of conflicting compliance requirements, SES follows the
rules of the home market.
ORGANISATION PRINCIPLES
Created on 16 March 2001 under the name of SES GLOBAL, SES was
incorporated in Luxembourg. On 9 November 2001, SES became the
parent company of SES ASTRA, originally created in 1985. A copy of
SES’ articles of incorporation, in its latest version, is available in the
corporate governance section of the Company’s website.
THE ANNUAL GENERAL MEETING OF SHARE-
HOLDERS
Under Luxembourg company law, the Company’s annual and / or
extraordinary general meetings represent the entire body of share-
holders of the Company. They have the widest powers, and resolutions
passed at such meetings are binding upon all shareholders, whether
absent, abstaining from voting or voting against the resolutions.
The meetings are presided over by the Chairperson of the Board or,
in his absence, by one of the Vice Chairpersons of the Board or, in
their absence, by any other person appointed by the meeting. Any
RESTRICTIONS ON OWNERSHIP
No A-shareholder may hold, directly or indirectly, more than 20%,
33% or 50% of the Company’s shares unless he has obtained prior
approval from the meeting of shareholders in accordance with the
procedure described here below. Such limit shall be calculated by
taking into account all the shares held by the A-shareholder.
A shareholder or a potential shareholder who envisages to acquire by
whatever means, directly or indirectly, more than 20%, 33% or 50% of
the shares of the Company (a ‘demanding party’) must inform the
Chairperson of the Board of the Company of such intention.
The Chairperson of the Board will inform the government of Luxem-
bourg of the envisaged acquisition. The government may oppose the
acquisition within three months from such information if it deter-
mines that such acquisition would be against the general public inter-
est.
In case of no opposition from the government of Luxembourg, the
Board shall convene an extraordinary meeting of shareholders which
may decide at a majority provided for in article 450-3 of the law of
10 August 1915, as amended, regarding commercial companies, to
authorise the demanding party to acquire more than 20%, 33% or 50%
of the shares. If the demanding party is a shareholder of the Company,
it may attend the general meeting and will be included in the count
for the quorum but may not take part in the vote.
INFORMATION EXCHANGE IN REGARD TO
CORPORATE GOVERNANCE
The Company communicates transparently with its shareholders via
the
corporate governance section of its website and through the
dedicated e-mail address [email protected]. In line with Luxem-
bourg law, the Company allows shareholders to receive all corporate
documentation, including the documents for shareholder meetings,
in electronic format.
In this context, the SES website contains a regularly updated stream of
information, such as the latest version of the Company’s main governance
documents, including the articles of incorporation, the corporate govern-
ance charter (including the charters of the various committees set up by
the Board) and the separate sections on the composition and the mission
of the Board, the Board’s committees and the Executive Committee
1
.
The SES website also contains the SES Code of Conduct and Ethics,
the SES Dealing Code, the financial calendar and any other informa-
tion that may be of interest to the company’s shareholders.
INVESTOR RELATIONS
SES’ dedicated Investor Relations function reports to the Chief Finan-
cial Officer and works closely with the CEO. Its purpose is to develop
and coordinate the group’s external financial communications and
interactions with equity and debt investors, investment analysts,
credit rating agencies, financial journalists and other external audi-
ences, to monitor stock market developments, and to provide feed-
back and recommendations to the SES SLT.
The Head of Investor Relations is responsible for the definition and
execution of SES’ active Investor Relations programme and partici-
pation in investor conferences and similar events. Investor Relations
also works closely with the Chief Legal Officer to ensure that the
group’s external communications are compliant with all applicable
legal and regulatory requirements.
The SES Investor Relations team will be pleased to assist existing or
potential shareholders with any questions they may have in relation
to SES. Further, the SES IR Website contains information on all
recent financials, analyst coverage, financial calendar and Company
news, and is updated on a regular basis.
1 The Executive Committee is internally called the Senior Leadership Team (SLT).
Therefore, going forward the term SLT will be used instead of Executive Committee.
SES ANNUAL REPORT 202162
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
shareholder who is recorded in the company’s shareholder register
14 days before the meeting is authorised to attend and to vote at the
meeting. An A-shareholder may act at any meeting by appointing a
proxy (who does not need to be an A-shareholder).
The annual general meeting (‘AGM’) is held on the first Thursday in
April at 10:30 am CET. Each registered shareholder will receive written
notice of the AGM, including the time of the meeting and the agenda,
at least 30 days prior to the meeting. Holders of the company’s FDRs
will be represented at the meeting by Banque et Caisse d’Epargne de
l’Etat acting as fiduciary. Each FDR will represent one A-share. If a
holder of FDRs wishes to attend the AGM of shareholders in person,
that shareholder will need to convert at least one FDR into an A-share.
Notice of the meeting and of the proposed agenda will also be pub-
lished in the international press. The fiduciary will circulate the draft
resolutions to both international clearing systems, Clearstream and
Euroclear, allowing FDR holders to give their voting instructions to
the fiduciary in time for the meeting. At the same time, the draft res-
olutions will be made available on the Company’s and on the fiduci-
ary’s website. Unless the fiduciary has received specific instructions
from the FDR holder, the fiduciary will vote in favour of the proposals
submitted by the Board. One or more shareholders owning together
at least 5% of the shares of SES have the right to add items on the
agenda of the AGM and may deposit draft resolutions regarding items
listed in the agenda or proposed to be added to the agenda. This
request will need to be made in writing (via mail or e-mail) and
received no later than the twenty-second day preceding the AGM and
will need to include a justification or draft resolution to be adopted
at the AGM. The written request must include a contact address to
which the Company can confirm receipt within 48 hours from the
receipt of the request.
No later than fifteen days preceding the AGM, the Company will then
publish a revised agenda.
The meeting may deliberate validly only if at least half of the A-shares
and at least half of the B-shares are represented. In the event that
the required quorum is not reached, the meeting will be reconvened
in accordance with the form prescribed by the articles of incorpora-
tion. It may then validly deliberate without consideration of the num-
ber of represented shares.
The proceedings are mostly held in French, but an English translation
is provided by the Company. Interventions in English will be translated
into French. A French version of the AGM minutes and the results of
the shareholders’ votes will be published on the SES website within
15 days after the AGM.
With the exception of the procedure described above regarding when-
ever an A-shareholder intends to hold more than 20%, 33% or 50%,
all the resolutions of the meeting are adopted by a simple majority
vote except if otherwise provided for by Luxembourg company law.
In 2021, the AGM was held on 1st April. Following the recommenda-
tions from the government in the context of the Covid-19 pandemic,
shareholders who had expressed an interest to attend the meeting
were asked to give a proxy to the Chairperson of the Board and/or
the Company’s outside legal counsel, and to vote on the resolutions
ahead of the meeting. The AGM itself was transmitted via Webex.
Shareholders were further invited to send their questions ahead of
the meeting, although additional questions were asked during the
meeting. The AGM was attended by 98.21% of the Company’s
shareholders, excluding the 5,459,979 FDRs held by the Company. All
resolutions submitted to the shareholders were approved by comfort-
able majority votes. The detailed results of the shareholders’ votes
are available on the company’s website.
SES ANNUAL REPORT 202163
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
BOARD OF DIRECTORS &
COMMITTEES
FRANK ESSER
Chairman of the Board
SERGE ALLEGREZZA
Director
PAUL KONSBRUCK
Director
(until 1st December 2021)
JACQUES THILL
Director
TSEGA GEBREYES
Vice-Chairperson of the Board
PETER VAN BOMMEL
Chairman of the
Audit and Risk Committee
RAMU POTARAZU
Director
FRANÇOISE THOMA
Chairperson of the Remuneration
Committee
ANNECATHERINE RIES
Chairperson of the Nomination
Committee & Vice-Chairperson
of the Board
BÉATRICE DE CLERMONT-
TONNERRE
Director
KAJERIK RELANDER
Director
KATRIN WEHRSEITER
Director
SES ANNUAL REPORT 202164
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
BOARD OF DIRECTORS & COMMITTEES
The Board of Directors is responsible for:
• Defining the Company’s strategic objectives as well as its overall
corporate plan;
• Approval, upon proposal from the Senior Leadership Team of the
annual consolidated accounts of the Company and the appropriation
of results, the group’s medium-term business plan, the consolidated
annual budget of the Company and the management report to be
submitted to the meeting of shareholders; approval of major invest-
ments and responsible vis-à-vis shareholders approval third parties
for the management of the Company, management which it delegates
to the SLT in accordance with the company’s internal regulations.
• As of 31 December 2021, the Board was comprised of 11 members
of which 7 were considered independent.
MEMBERS OF THE BOARD
AS OF 31 DECEMBER 2021
Frank Esser
Chairman of the Board
Chairperson of the Strategic Committee
• Frank Esser became a director on 11 February 2020.
•
He is the former Chairman and CEO of SFR, the leading private
French Telecom Operator. In this function he also served as Board
Member of Vivendi Group. Prior to joining SFR, Mr Esser held
several managerial positions with Mannesmann group. He also
serves as Vice Chair of Swisscom.
• He was re-elected as Chairman of the Board on 1 April 2021. He is
the Chairperson of the Strategic Committee and a member of the
Nomination Committee and of the Remuneration Committee of SES.
•
Mr Esser holds a PhD in Managerial Economics and an MS in
Economics both from the University of Cologne.
• Mr Esser is a German national. He is an independent director.
Tsega Gebreyes
Vice-Chairperson of the Board
• Mrs Tsega Gebreyes became a director on 4 April 2013.
• She is the Founding Director of Satya Capital Limited. She served as
Chief Business Development and Strategy Officer of Celtel Inter-
national BV and Senior Advisor to Zain.
• She was also Founding Partner of the NAOF, LLP and has worked with
McKinsey and Citicorp.
• Mrs Gebreyes is a director of Satya Capital Limited, LSEG and Airtel
Plc and was a director of Sonae. She is a Senior Advisor to TPG Growth.
•
She is Vice-Chairperson of the Board and a member of the Nomination
Committee of SES.
• She has a double major in Economics and International Studies from
Rhodes College and holds an M.B.A. from Harvard Business School.
• Mrs Gebreyes is an Ethiopian national. She is an independent director.
Anne-Catherine Ries
Vice-Chairperson of the Board
Chairperson of the Nomination Committee
• Mrs Ries became a director on 1 January 2015.
• Mrs Ries is currently First Government Advisor to the Prime Minis-
ter and Minister for Media and Telecommunications in Luxembourg,
in charge of media, telecom and digital policy. Prior to this appoint-
ment in 2019, her focus over the last two decades has consistently
been on developing the tech and digital innovation ecosystem in
Luxembourg, i.a. through the launch of the “Digital Luxembourg”
initiative in 2014. She joined the Luxembourg civil service after
starting her professional career at an American law firm in Paris.
• Mrs Ries holds a law degree from the University of Paris II and the
University of Oxford, and a postgraduate LL.M degree from the
London School of Economics.
• Mrs Ries is the Chairperson of the Nomination Committee of SES.
•
Mrs Ries is a Luxembourg and French national. She is not an
independent director because she represents an important share-
holder.
Serge Allegrezza
• Mr Allegrezza became a director on 11 February 2010.
•
He is currently the Director General of Statec, the Luxembourg
Institute for Statistics and Economic Studies, a post he has held
since April 2003. He is a certified IDP (INSEAD).
• He was Conseiller de Gouvernement 1ère classe at the Ministry of
Economics, responsible for internal market policy, and is the Chairman
of the Observatory for Competitiveness. He is also the Chairman
of the Board of Directors of POST Luxembourg and of the Board of
LuxTrust i.n.c and former president of the Conseil Economique et
Social.
•
Mr Allegrezza, was a part-time lecturer at the IAE/University of Nancy 2,
has a Master in economics and a PhD. in applied economics.
• Mr Allegrezza is a member of the Audit and Risk Committee and of
the Remuneration Committee of SES.
• Mr Allegrezza is a Luxembourg national. He is not an independent
director because he represents an important shareholder.
Peter van Bommel
Chairman of the Audit and Risk Committee since 2 August 2021
• Mr van Bommel became a director on 2 April 2020.
•
Mr van Bommel was Chief Financial Officer and member of the
Board of Management of ASM International from August 2010 until
May 2021.
•
He has more than twenty years of experience in the electronics and
semiconductor industry. He spent most of his career at Philips,
which he joined in 1979.
•
He sits on the Board of Aalberts, Nedap, Bernhoven Foundation
and the Amsterdam Business School, where he is the Chair of the
EMFC Curatorium. In the past he was also a Director of several other
listed companies a.o. KPN.
• Mr van Bommel holds an MSc in Economics from Erasmus Univer-
sity in Rotterdam.
•
Mr van Bommel is the Chairperson of the Audit and Risk Committee,
a member of the Remuneration Committee and of the Strategic
Committee of SES.
• Mr van Bommel is a Dutch national. He is an independent director.
SES ANNUAL REPORT 202165
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Béatrice de Clermont-Tonnerre
•
Mrs Béatrice de Clermont-Tonnerre has held several executive posi-
tions at Google including Director AI Partnerships EMEA and
Southern Europe Monetisation Director for six years until Q3 2019.
• Before that, Mrs de Clermont-Tonnerre worked 15 years for Groupe
Lagardère in different Executive roles including Senior VP for Cor-
porate Development. She previously worked at Groupe Canal Plus,
having started her career with Matra Marconi Space. She is the
Lead Director of Grupo Prisa (Spain) and a member of the Board
of Directors of Klépierre (France). She is an Investor and Executive
Committee Member of Kayrros, a climatetech company pioneering
pollutant emissions quantification along the energy supply chain.
• Mrs de Clermont-Tonnerre holds a Master’s degree in Politics and
Economics from the Institut d’Etudes Politiques in Paris and an
MBA from ESSEC Business School, France.
•
Mrs de Clermont-Tonnerre is a member of the Nomination Commit-
tee and of the Strategic Committee of SES.
•
Mrs de Clermont-Tonnerre is a French national. She is an independ-
ent director.
Paul Konsbruck
(director until 1 December 2021)
• Mr. Konsbruck became a director on 13th June 2019. He resigned on
1st December 2021. He was First Government Councillor at the
Ministry of State and Chief of Staff to the Prime Minister and Minister
for Media and Communications in Luxembourg as of 1 January 2016.
He now is CEO of LuxConnect S.A.. Paul Konsbruck holds a Master
degree in Literature and Linguistics from the University of Heidel-
berg, and participated in the Senior Executive Fellow Programme at
the Harvard Kennedy School. He was a Director of ENCEVO SA and
is the government commissioner to CLT-UFA/RTL Luxembourg.
• He was a member of the Nomination Committee and of the Strategic
Committee of SES.
•
Mr. Konsbruck is a Luxembourg national. He was not an independent
director because he represented an important shareholder.
Ramu Potarazu
• Mr Potarazu became a director on 20 February 2014.
• He was the CEO of Binary Fountain. He is the Founder and former
CEO of Vubiquity.
• Prior to founding Vubiquity, Mr Potarazu spent 15 years in various
positions at Intelsat (1991–2006). He became Intelsat’s Vice
President of Operations and CIO in 1996 and its Vice President,
Commercial Restructuring in 2000. In 2001 Mr Potarazu became
President of Intelsat Global Service Corporation and from 2002 to
2006 he was President and Chief Operating Officer of Intelsat Ltd.
Prior to joining Intelsat, Mr Potarazu held several engineering
positions.
•
Mr Potarazu graduated with a BS in Computer Science and in
Mathematics from the Oklahoma Christian University. He also holds
an MSc in Electrical Engineering from the John Hopkins University
and was a member of the Stanford Executive Program.
•
He is a member of the Remuneration Committee and of the
Strategic Committee of SES.
• Mr Potarazu is a US national. He is an independent director.
Kaj-Erik Relander
• Mr Relander became a director on 6 April 2017.
•
Mr Relander worked for the Finnish National Fund for Research and
Development prior to joining Sonera Corporation where he held
several management positions, including the position of CEO. He
left Sonera in 2001 to join Accel Partners, a private equity and venture
capital group before joining the Emirates Investment Authority in
2009 where he was a member of its Investment and Management
Committee.
•
Mr Relander graduated from the Helsinki School of Economics with
an MSC in Economics. He also holds an MBA from the Helsinki
School of Economics having completed part of it at the Wharton
School, University of Pennsylvania (USA), and studied also for a
PhD at the Wharton School and the Aalto University, Helsinki.
•
Mr Relander is a board member of the sovereign wealth fund of
ADQ and ADGM, Abu Dhabi Global Markets. He is Chairman of the
Investment Committee at the private equity fund Apis.pe and a
board director of Starzplay Arabia.
•
He is a member of the Audit and Risk Committee and of the
Nomination Committee of SES.
• Mr Relander is a Finnish national. He is an independent director.
Jacques Thill
• Mr Thill was co-opted as director of SES on 2 December 2021 as
replacement for Mr Paul Konsbruck.
• Mr Thill currently serves as First Government Advisor to the Prime
Minister and Coordinator at the Luxembourg Prime Minister’s
Office. Since 2018 he is also the Government Delegate to the State
Intelligence Service. Mr Thill joined the Luxembourg diplomatic
service in 2004 and has represented Luxembourg in numerous bi- and
multilateral negotiations. His diplomatic career includes postings
to the Luxembourg Permanent Representation to the United
Nations in New York and to the Luxembourg Embassy in Moscow,
as well as to the EU High Representative for the Common Foreign
and Security Policy at the Council of the European Union in Brus-
sels. From 2009 to 2013, Mr Thill served as diplomatic advisor to
the Prime Minister. In 2013, he was appointed Deputy Secretary
General of the Luxembourg Government, before becoming Secretary
General of the Luxembourg Government until June 2020.
• Mr Thill holds a Master in European and International Law from the
Paris 1 Panthéon-Sorbonne University and an MA in European Political
and Administrative Studies from the College of Europe in Bruges
where he specialized in European Competition Law and European
Foreign Policy.
• From 2015 until 2021, Mr. Thill has been a member of the Board of
Directors of LUXGOVSAT S.A.
•
Mr Thill is a member of the Nomination Committee and of the
Strategic Committee.
• Mr Thill is a Luxembourg national. He is not an independent director
because he represents an important shareholder.
SES ANNUAL REPORT 202166
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Françoise Thoma
Chairperson of the Remuneration Committee
• Ms Thoma became a director on 16 June 2016.
• Ms Thoma is President and Chief Executive Officer of Banque et
Caisse d’Epargne de l’Etat, and a member of the Boards of Directors
of Cargolux International Airlines S.A., Luxair S.A., the Luxembourg
Stock Exchange and of Enovos Luxembourg S.A.
•
She was a member of the Luxembourg Council of State from 2000–
2015 and holds a PhD in Law from the Université de Paris II
Panthéon-Assas and an LL.M. from Harvard Law School.
• Ms Thoma is the Chairperson of the Remuneration Committee and
a member of the Audit and Risk Committee of SES.
•
Ms Thoma is a Luxembourg national. She is not an independent
director because she represents an important shareholder.
Katrin Wehr-Seiter
Chairperson of the Audit and Risk Committee until 2 August 2021
• Mrs Wehr-Seiter became a director on 1 January 2015.
•
She is a Managing Director of BIP Investment Partners SA and a
Managing Director/Partner of BIP Capital Partners.
• Prior to joining BIP, she served as a Principal at global investment firm
Permira and worked also as an independent strategy consultant as
well as a Senior Advisor to international private equity group Bridge-
point. She started her professional career at Siemens AG where she
held various positions in strategy consulting and engineering. She
serves as a director of Bellevue Group and several non-listed corpo-
rations.
• Mrs Wehr-Seiter holds an MBA from INSEAD and an MSc in Mechanical
Engineering from the Technical University of Chemnitz.
• Mrs Wehr-Seiter is a member of the Audit and Risk Committee and
of the Remuneration Committee of SES.
• Mrs Wehr-Seiter is a German national. She is an independent director.
MISSION AND COMPOSITION
The Board of SES is composed of 11 non-executive directors, five of
them female.
In accordance with the Company’s articles of association, two-thirds of
the board members represent the holders of A-shares and one-third
of the board members represent the holders of B-shares.
The mandates of the current directors will expire at the AGM of share-
holders in April 2022, 2023 and 2024, respectively.
In the event of a vacancy on the Board, the remaining directors may,
upon a proposal from the Nomination Committee and on a temporary
basis, fill such a vacancy by a majority vote. In this case, the next AGM
of shareholders will definitively elect the new director, who will com-
plete the term of the director whose seat became vacant. Mr Paul
Konsbruck having resigned with effect from 1st December 2021, the
Board of SES co-opted Mr Jacques Thill with effect from 2 December
2021.
In accordance with internal regulations adopted by the Board, at least
one-third of the board members must be independent directors.
A board member is considered independent if he or she has no
relationship of any kind with the company or management that may
impact his or her judgment.
Independence for these purposes is defined as:
1. not having been an employee or officer of the company over the
previous five years;
2. not having had a material business relationship with the company
over the last three years; and
3. not representing a significant shareholder holding more than 5%
of the voting shares directly or indirectly.
As of 31 December 2021, seven of the board members are considered
independent: Béatrice de Clermont-Tonnerre, Tsega Gebreyes,
Katrin Wehr-Seiter, Frank Esser, Ramu Potarazu, Kaj-Erik Relander
and Peter van Bommel.
The four current directors proposed by the B-shareholders are not
considered independent as they represent a significant shareholder
owning more than 5% of the company’s shares.
Thai Rubin, Chief Legal Officer, is the Board Secretary. He is supported
by Mathis Prost, Senior Manager, Legal Services Corporate and
Finance, as Assistant Secretary to the Board of Directors.
In the context of the Board composition, the SES Nomination Com-
mittee will consider a diverse Board as adding value to the Company,
not limiting diversity to gender diversity, but also considering, as far
as possible, professional background, experience and age diversity.
RULES OF GOVERNANCE
The Board of Directors meets when required by the Company’s busi-
ness, and at least once per quarter. It can only validly deliberate if a
majority of the directors are present or represented. The resolutions
of the Board are passed by a simple majority of the votes of the vot-
ing directors present or represented, not considering abstentions. The
Chairman does not have a casting vote.
Any material contract that is proposed to be signed by the Company
or any of its wholly controlled operating subsidiaries with a share-
holder owning at least 5% of the shares of the Company, directly or
indirectly, is subject to a prior authorisation by the Board.
In 2021, there were no transactions between the Company and a
shareholder owning at least 5% of the company’s shares, nor were
there any other transactions involving a conflict of interest for any of
the directors.
SES ANNUAL REPORT 202167
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
ACTIVITIES OF THE BOARD OF DIRECTORS
IN 2021
The Board of Directors held three physical meetings and seven Board
calls in 2021, with an attendance rate of more than 95%. In accordance
with the sanitary measures related to the COVID-19 pandemic,
imposed on the company as of March 2020, a number of board
meetings were held via video conference calls. The three physical
meetings were held under strict sanitary control measures, allowing
virtual attendance for Board members unable to attend in person.
After endorsement by the Audit and Risk Committee, the Board
approved the 2020 audited accounts, the dividend and the financial
results for the first half of 2021.
The Board approved the final version of the 2022 Budget and the
2022–2026 Business Plan. It also reviewed the Strategic Plan and held
a detailed Strategic Session in June 2021. On that occasion and
throughout the year, Management briefed the Board on the latest
industry trends and the resulting strategic implications for SES.
The Board approved the investment in a replacement fleet of two
satellites for 19.2°E thus ensuring continuity of service on an impor-
tant position for SES.
With regard to the Company’s corporate governance, the Board
reviewed the decision powers of the Committees and resolved that
all decision powers should revert from those Committees to the Board.
The Board approved the charter of the Strategic Committee.
During 2021, the Board also decided to launch a new share buyback
programme, implemented through the filing of a ‘notice d’information’
on 6 May 2021 a decision taken by the shareholders during the AGM
of 1 April 2021. The 2021 programme executed on Euronext Paris is
limited to the objective of purchasing FDRs and shares of SES, through
its subsidiary SES Astra, for cancellation by 2023.
The Board was regularly updated on the development of the major
projects and it noted updates on the company’s risk management
report. The Senior Leadership Team (SLT) regularly informed the
Board about the group’s activities and financial situation. The Board
noted updates on: (i) the execution of the Strategic Plan; (ii) the 2021
Business Objectives; (iii) the impact of COVID-19 on the Company’s
business as well as its staff; and (iv) the Company’s continued corpo-
rate simplification program which resulted in an important further
reduction of the number of entities of the group in 2021.
At each meeting, directors receive a report on ongoing matters and
the Chairpersons of the committees set up by the Board present a
report on the latest developments discussed in these respective com-
mittees. In addition, a business report is distributed to the members
of the Board on a monthly basis.
As a result of the last Board evaluation exercise and in-keeping with
best practice, each Board meeting concludes with a restricted ses-
sion, without the presence of Management.
BOARD GOVERNANCE STRUCTURE
& COMMITTEES
The Board agenda is prepared in close cooperation between the
Chairman, the Vice-Chairpersons and the CEO. The committees con-
sist of five to six members, at least a third of whom are independent
board members in line with SES’ internal regulations.
The Audit and Risk Committee assists the Board in carrying out its
oversight responsibilities in relation to corporate policies, risk manage-
ment, internal control, internal and external audit and financial and
regulatory reporting practices. It has an oversight function and pro-
vides a link between the internal and external auditors and the Board.
The Remuneration Committee assists the Board on the determination
of the remuneration of the members of the Senior Leadership Team
(SLT) and advises on the overall remuneration policies applied
throughout the Company. It acts as administrator of the Company’s
long-term equity plans.
The Nomination Committee identifies and proposes suitable candi-
dates for the Board of Directors, for election by the AGM of sharehold-
ers. Proposals are based on submissions from shareholders for a num-
ber of candidates at least equal to the number of posts to be filled for
each class of shareholders. It also identifies and proposes suitable
candidates for the SLT.
The Strategic Committee reviews, analyses and discusses market
trends, market opportunities, risks and the competitive landscape.
The Committee prepares Board discussions on strategic matters and
supports Management in planning and preparing the annual Strate-
gic Plan for approval by the Board as well as in the preparation of any
investment or divestment decision for approval by the Board. The
Strategic Committee discusses and reviews important industry and
company developments as presented by Management and reviews
with Management the implementation of strategic and investment
decisions approved by the Board.
SES ANNUAL REPORT 202168
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SECRETARY OF THE
BOARD OF DIRECTORS
STRATEGIC
COMMITTEE
NOMINATION
COMMITTEE
REMUNERATION
COMMITTEE
AUDIT AND RISK
COMMITTEE
• Chair:
Peter van Bommel
• Serge Allegrezza
• Kaj-Erik Relander
• Françoise Thoma
• Katrin Wehr-Seiter
• Chair:
Françoise Thoma
• Serge Allegrezza
• Peter van Bommel
• Frank Esser
• Ramu Potarazu
• Katrin Wehr-Seiter
• Chair:
Anne-Catherine Ries
• Béatrice de Clermont- Tonnerre
• Frank Esser
• Tsega Gebreyes
• Paul Konsbruck
(until 1st December 2021)
• Kaj-Erik Relander
• Jacques Thill
(as of 2nd December 2021)
• Chair:
Frank Esser
• Peter van Bommel
• Béatrice de Clermont- Tonnerre
• Ramu Potarazu
• Paul Konsbruck
(until 1st December 2021)
• Jacques Thill
(as of 2nd December 2021)
• Thai Rubin
CHAIRMAN OF THE BOARD: FRANK ESSER
VICECHAIRPERSONS OF THE BOARD: TSEGA GEBREYES, ANNECATHERINE RIES
MEETINGS AND ATTENDANCE RATE IN %
2 Hybrid meetings
and 3 calls
100%
2 Hybrid meetings
and 4 calls
100%
2 Hybrid meetings
and 2 calls
100%
9 Calls
98%
COMMITTEES OF THE BOARD
as of 31 December 2021
SES ANNUAL REPORT 202169
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
THE
AUDIT AND RISK
COMMITTEE
• Reviewed the 2020 financial results before their sub-
mission to the Board and their subsequent approval
by the shareholders at the statutory AGM.
• Reviewed the H1 2021 financial results of the Com-
pany. Members had the opportunity to communicate
any comments they had on the Company’s quarterly
results prior to the publication of these results.
• Reviewed the Company’s statement on internal con-
trol systems prior to its inclusion in the annual report,
approved the Internal Audit plan, and received bi-an-
nual updates on the Internal Audit activities and on
the follow-up of the major recommendations. It also
reviewed the 2020 PwC Management letter.
• Proposed to the Board and to the shareholders to
appoint PwC as external auditor for 2021 including its
proposed compensation.
• Received quarterly updates on risk management from
the SES risk management committee and was briefed
on ongoing compliance matters.
• Reviewed WACC parameters for remuneration pur-
poses, customer credit risk and collection and of the
Treasury Roadmap.
• PwC briefed the Audit and Risk Committee on upcom-
ing regulatory changes. After each meeting, the Board
is briefed in writing about the work of the Audit and
Risk Committee.
• Received updates on ESG targets and implementation
plan.
• Reviewed the Company’s Budget and Business Plan.
THE
REMUNERATION
COMMITTEE
• Matters addressed related to the determination of
the bonuses and the vesting of performance shares
allocated to the members of the SLT for their per-
formance in 2020.
• Adoption of the 2021 corporate business objectives,
which are used as one element in the determination
of 2021 bonuses for SLT members.
• Review and proposal of the remuneration packages
for new SLT members.
• Review and proposal of the 2021 long term equity
grants for SLT members.
• Proposed to review and adjust the Remuneration
Policy. The proposal has been approved by the
Board and by the Ordinary Shareholder Meeting.
• After each meeting, the Board is briefed in writing
about the work of the Remuneration Committee.
THE
NOMINATION
COMMITTEE
THE
STRATEGIC
COMMITEE
• Discussed the size and the composition of the
Board.
• It also discussed the renewal of existing directors,
conducted interviews and proposed to the Board a
list of candidates for election by the shareholders
in April 2021.
• Discussed the future structure of the Executive
Committee and was involved in its implementation
in close cooperation with the CEO.
• Instigated a deep dive on Talent Management and
reviewed Executive Committee Succession Plan-
ning.
• After each meeting, the Board is briefed in writing
about the work of the Nomination Committee.
• Discussed strategic industry trends, market oppor-
tunities, risks and competition and the disruption
underway in satellite industry.
• Included input from outside consultants.
•
Regularly reviewed progress on various strategic
opportunities.
•
Reviewed and discussed the company strategy and
strategic options.
• After each meeting, the Board is briefed in writing
about the work of the Strategic Committee.
ACTIVITIES OF THE
COMMITTEES IN 2021
SES ANNUAL REPORT 202170
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SENIOR LEADERSHIP
TEAM (SLT)
STEVE COLLAR
CEO, SES Group,
Chairman of the SLT
JOHN BAUGHN
Chief Services Officer
JOHNPAUL HEMINGWAY
Chief Strategy and Product Officer
SANDEEP JALAN
Chief Financial Officer
CHRISTOPHE DE HAUWER
Chief Development Officer
RUY PINTO
Chief Technology Officer
THAI RUBIN
Chief Legal Officer
EVIE ROOS
Chief Human Resources Officer
SES ANNUAL REPORT 202171
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
SENIOR LEADERSHIP TEAM (SLT)
The SES Executive Committee is known as the Senior Leadership
Team (SLT):
• It is in charge of the daily management of the group.
• It functions as a collegial body.
• It is mandated to prepare and plan the overall policies and strate-
gies of the company for approval by the Board.
•
It may approve intra-group transactions, irrespective of the amount,
provided that they are consistent with the consolidated annual
budget of the company, as well as specific transactions with third
parties provided that the cost to SES does not exceed €10 million
per transaction.
• It informs the Board at its next meeting of each such transaction,
it being understood that the aggregate amount for all such trans-
actions can at no time be higher than €30 million. Members of
the SLT are appointed by the Board of Directors upon a proposal
from the Nomination Committee.
Steve Collar
CEO, SES Group, Chairman of the SLT
• Appointed in April 2018.
• From 2017 to 2018 he was CEO of SES Networks.
•
Prior to SES, he was CEO of O3b Networks, and has profound expe-
rience in a variety of commercial, business development and tech-
nical roles at SES WORLD SKIES, New Skies Satellites, Astrium and
Matra Marconi Space (now Airbus).
• Holds a degree in Mechanical Engineering from Brunel University
in London.
• Mr Collar is a British national.
Sandeep Jalan
Chief Financial Officer
• Appointed in May 2020.
• He has 30 years of experience in financial and operational leader-
ship roles across Asia and Europe. He was until most recently the
CFO of Aperam, a global leader in the stainless, electrical and spe-
cialty steel industry, a role he held since 2014. Previously, he worked
for the ArcelorMittal Group since 1999 where he held various roles
including the CFO of ArcelorMittal Long Carbon Europe and was
part of the M&A team responsible for numerous acquisitions in both
steel and mining. He was also the CFO & Company Secretary for
Ispat Alloys Ltd from 1993 to 1999.
• He is a Commerce Graduate from Banaras Hindu University (BHU),
Chartered Accountant (equivalent to CPA) and Company Secretary
from the respective Institutes in India. He has also completed an
Executive Education Programme on Leadership at the London Busi-
ness School and an Executive Education program on Strategic
Finance at IMD, Lausanne.
• Mr Jalan is an Indian national.
Evie Roos
Chief Human Capital Officer
• Appointed in February 2017.
•
Prior she held the position of Executive Vice-President Human
Resources of SES and is a member of the Board of SES ASTRA,
as well as an elected member of the Luxembourg Chamber of
Commerce.
•
Before joining SES, she held various management positions at
ArcelorMittal.
• She holds two degrees in Law and European Studies from the Uni-
versity of Leuven in Belgium and the Europa Institut in Saarbrücken
in Germany.
• Mrs Roos is a Belgian, Luxembourg and US national.
John-Paul Hemingway
Chief Strategy and Product Officer
• Appointed in April 2018 as CEO of SES Networks.
• Prior to that, he served as the Executive Vice President, Product,
Marketing and Strategy of SES Networks where he led Product
Management, Marketing, Business Development and Corporate
Strategy.
• Before SES acquired O3b and formed SES Networks, he was Chief
Marketing Officer for O3b Networks.
• Prior to that, he held a variety of senior management roles in the
networking industry within Ciena, Corning Cables, and Netscient.
•
Holds a PhD in Optical Communications and a BSc (Hons) from
Manchester Metropolitan University, UK.
• Mr Hemingway is a British national.
SES ANNUAL REPORT 202172
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Christophe De Hauwer
Chief Development Officer
•
Appointed in August 2015 as Chief Strategy and Development
Officer.
• Member of the Board of SES ASTRA.
• Having joined SES in 2003, he held several positions of responsi-
bility in the areas of Strategic Marketing, Strategic and Business
Planning and Corporate Development, as well as Fleet Development
and Yield Management.
• Prior to joining SES, he worked in the Strategy Consulting practice
of the European Telecommunication and Media Industry with
Arthur Andersen.
• Holds an Engineering and a PhD Degree from the Université Libre
de Bruxelles.
• Mr De Hauwer is a Belgian national.
Ruy Pinto
Chief Technology Officer
• Appointed in January 2019.
• Since 2017, he had been the Deputy Technology Officer and took
on the additional role of Chief Information Officer (CIO) at SES in
2018.
•
Between 1990 to 2016 he was working for Inmarsat where he
covered various technical and managerial roles, such as CTO and
Group Chief Operations Officer (COO).
• Prior to that he was Chairman of UKSpace, and Director and VP of
Space for the Association of Defence, Security and Aerospace
Companies (ADS) and Non-Executive Director of the Space Appli-
cation Catapult.
•
Holds a degree in Electronics Engineering and completed
post-graduate studies in Digital Telecommunications Systems, both
from the Rio de Janeiro Catholic University (PUC-RJ).
• Mr Pinto is a dual British and Brazilian national.
John Baughn
Chief Services Officer
• Appointed in January 2019.
• Since 2017, he had been Executive Vice President, Global Services
at SES Networks.
•
He joined SES Networks from O3b Networks, where he led the
Global Services team, driving service strategy.
• Between 2008 and 2015, he was VP Global Services at Ciena, and
has a vast Telco experience included leadership roles in Motorola.
• Holds an MBA from the University of Warwick.
• Mr Baughn is a British national.
Thai Rubin
Chief Legal Officer
• Appointed in July 2020.
• Prior to that, he was the General Counsel of O3b Networks where
he was as a key member of the leadership team, guiding the com-
pany to its successful commercialisation before it was acquired by
SES in 2016.
• In addition to holding multiple senior leadership roles within SES,
he served as General Counsel at New Skies Satellites, guiding it to
a public listing on the NYSE in 2005 and its acquisition by SES in
2006.
• Before joining SES, Mr Rubin worked at PanAmSat Corporation.
• Holds a Bachelor of Science degree from the University of Wiscon-
sin, Madison and a Juris Doctor from Howard University School of
Law in Washington, D.C.
• Mr Rubin is a US national.
RESPONSIBILITIES OF THE SENIOR LEADERSHIP TEAM
•
The SLT may approve any external credit facilities or external guar-
antees, pledges, mortgages and any other encumbrances of the
Company, or any wholly-owned affiliate, for as long as the Company
will not lose its investment grade rating as a result of such facility
or guarantee.
•
It may approve increases of up to 5% in the capital expenditure
budget for a satellite procurement already approved by the Board,
it being understood that the Internal Rate of Return will need to
comply with certain specific thresholds defined by the Board. The
SLT informs the Board at its next meeting of each such increase.
• The SLT submits those measures to the Board that it deems nec-
essary to be taken in order to meet the purposes of the Company.
Prior to the beginning of each fiscal year, the SLT submits to the
Board a consolidated budget for approval.
•
The SLT is in charge of implementing all decisions taken by the
Board and by the committees specially mandated by the Board.
The SLT may, in the interests of the Company, sub-delegate part
of its powers and duties to its members acting individually or jointly.
• The CEO organises the work of the SLT and coordinates the activ-
ities of its members, who report directly to him. In order to facilitate
the implementation by the Board of its overall duty to supervise
the affairs of the Company, the CEO informs the Chairman of the
Board on a regular basis of the Company’s activities. The latter
receives the minutes of all meetings of the SLT in due time.
SES ANNUAL REPORT 202173
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
INTERNAL CONTROL PROCEDURES
OBJECTIVES AND PRINCIPLES
The Board of Directors has the overall responsibility for ensuring that
SES maintains a sound system of internal controls, including financial,
operational and compliance controls. Such a system is an integral part
of the corporate governance strategy of SES S.A. (‘the Company’)
together with its subsidiaries and affiliates (‘the Group’).
Internal control procedures help to ensure the proper management
of risks and provide reasonable assurance that the business objec-
tives of the Company can be achieved.
The internal control procedures are defined and implemented by the
Company to ensure the following objectives in the table below:
Internal Control Objectives
Compliance of actions and decisions with applicable laws,
regulations, standards, internal rules, and contracts
Safeguarding efficiency and effectiveness of operations
and the optimal use of the company’s resources
Correct implementation of the Company’s internal processes,
notably those to ensure the safeguarding of assets
Integrity and reliability of financial and operational
information, both for internal and external use
Ensuring that management’s instructions and directions
are properly applied
Ensuring that material risks are properly identified,
assessed, mitigated, and reported
OBJECTIVES
Like all control systems, internal controls cannot provide an absolute
guarantee that all risks have been totally mitigated or eliminated.
CONTROL ENVIRONMENT
SES has adopted a robust internal control framework based on a set
of guidelines prepared by the Committee of Sponsoring Organisations
of the Treadway Commission (‘COSO’). This framework applies to both
the Group’s regular satellite business activities as well as to the
specific and dedicated C-band spectrum clearing activities taking
place in connection with the FCC Order dated 3rd March 2020. The
framework provides reasonable assurance that the internal control
objectives are being achieved; it is also consistent with the reference
framework proposed by the French securities regulator, the Autorité
des Marchés Financiers (‘AMF’).
The Board has delegated the design, implementation, and mainte-
nance of a rigorous and effective system of internal controls to the
Company’s Senior Leadership Team, which in turn works closely with
the other levels of management in establishing control policies and
procedures.
Policies and procedures are regularly reviewed and are updated when
required. The policies and procedures apply to all employees and
officers of the Group, and where appropriate, to its directors as well
as to other groups.
A Delegation of Authority Policy is in place, and is regularly updated,
providing the rules for the Internal Approval and External Execution that
are required to authorise any external commitment of the Company.
A Group-wide ‘Code of Conduct and Ethics’ (‘Code of Conduct’) was
implemented to enable all employees, officers and directors as well
as other groups to take a consistent approach to integrity issues and
to make sure that the Group conducts its business in compliance with
all applicable laws and regulations and observes the highest stand-
ards of business ethics.
A Compliance Committee composed of designated Compliance
Officers in each main corporate location, is tasked with raising the
employees’ awareness of the Code and ensures a consistent roll-out
and training programme for the Code. The Compliance Committee
meets regularly to discuss important topics or issues.
SES has a whistleblowing hotline, managed by a third-party provider,
which allows its employees to file any compliance complaints in full
confidence.
SES has implemented a comprehensive compliance training pro-
gramme with mandatory trainings related to cybersecurity, GDPR,
anti-bribery, sanctions & export controls, the Code of Conduct, and
harassment.
To ensure better compliance with data protection laws and regula-
tions, SES has a Data Protection Officer. SES has implemented a vari-
ety of measures, has reviewed and updated relevant procedures and
processes, and continuously strives to comply with the General Data
Protection Regulation (‘GDPR’).
The main SES functions and processes are electronically documented
using a centralised Business Process Management software to ensure
information is designed collaboratively and shared across the company.
To improve operations, SES is standardising its process mapping
using an end-to-end business process framework. This framework is
designed to ensure control and strategic alignment across the busi-
ness, while capitalising on the standards of the telecom industry.
SES ANNUAL REPORT 202174
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OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
RISK MANAGEMENT
SES adopted a risk management framework based on principles pro-
posed by COSO and ISO31000. A Risk Management Group is in place
representing SES key functions and being responsible for the ade-
quate reporting of the Company’s risks and the implementation of the
risk management policy and procedures.
Risk Management Structure
Delegation / Monitoring Risk Report Designated Risk Representatives of key SES functions
A dedicated Risk Management Team facilitates and coordinates the
reporting process and assists with the assessment of risks. The Risk
Management Group reports to the Senior Leadership Team which in
turn reports to the Board, which has the ultimate responsibility for
oversight of the Company’s risks and for ensuring that an effective
risk management system is in place. The risk management policy is
being reviewed and updated by the Risk Management Team.
Each reported risk is categorised, assessed by the risk owners, and
reviewed by the Risk Management Group. Key risk developments are
periodically reported to the Senior Leadership Team, the Audit and
Risk Committee and the Board.
INTERNAL CONTROL ACTIVITIES
Accounting, Consolidation and Reporting
In the area of accounting, consolidation and reporting, the following
should be noted:
• Staff involved in the Group’s accounting, consolidation and report-
ing are appropriately qualified, trained and are kept up to date with
relevant changes in International Financial Reporting Standards
(‘IFRS’).
•
Appropriate accounting and financial reporting policies and proce
-
dures are in place, regularly reviewed and updated for business
developments and regulatory changes.
•
Controls have been established in the processing of accounting
transactions to ensure appropriate authorisations, an effective seg-
regation of duties, and the complete and accurate recording of
financial information. This control framework continues to be
enhanced through the implementation of additional workflow-based
controls and validations.
•
A Business Process Management function within the Finance team
reviews key financial operations and identifies areas for further
enhancement of the efficiency of the processes and for reinforcing
the segregation of duties and internal controls.
•
Adequate procedures and controls are in place, such as monthly
reviews and data validation procedures, to ensure the correct and
timely recognition of revenues.
• The Group is currently replacing different legacy systems used for
processing order-to-cash transactions, and associated accounting
activities such as revenue recognition, with a common platform
covering nearly all the group’s operations. This implementation is
expected to be completed in 2022.
RISK MANAGEMENT GROUP
OVERALL IMPLEMENTATION OF THE RM POLICY & PROCEDURES
BOARD OF DIRECTORS (BOD)
OVERALL RESPONSIBILITY FOR RM
SENIOR LEADERSHIP TEAM (SLT)
RESPONSIBLE FOR THE RM AT THE MANAGEMENT LEVEL
AUDIT AND RISK COMMITTEE (ARC)
OVERSIGHT OF RM PROCESS
STRATEGY &
DEVELOPMENT
GLOBAL
SERVICES
SES
NETWORKS
SES
VIDEO
FINANCE
TECHNOLOGY
HUMAN
CAPITAL
LEGAL &
REGULATORY
RISK MANAGEMENT TEAM
INCL. RISK MANAGEMENT COORDINATOR
SES ANNUAL REPORT 202175
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OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
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CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
• Risk-based monitoring controls are implemented for key SAP con-
trol configurations and transactions
• The completeness and timely recording of financial information is
ensured through regular reviews, the monitoring of specific key
performance indicators, validation procedures by functional lead-
ers and, as an additional check, the process of internal and external
audit.
•
In accordance with IFRS requirements, SES discloses detailed
information on the market, credit, and foreign exchange risks to
which it is exposed, as well as its strategy for managing those
risks.
• The Company relies on a comprehensive system of financial infor-
mation and oversight. Strategic plans, business plans, budgets and
the interim and full-year consolidated accounts of the Group are
drawn up and brought to the Board for approval.
•
The Board also approves all significant investments. The Board
receives monthly financial reports setting out the Company’s finan-
cial performance in comparison to the approved budget and prior
year figures.
• Any material weaknesses in the system of internal controls identi-
fied by either internal or external auditors are promptly and fully
addressed.
•
The external auditors perform a limited review of the Group’s
interim condensed consolidated financial statements and a full
audit of the annual consolidated financial statements.
Space Related insurance
In the area of space-related insurance, the following should be noted:
•
Most of the launch and in-orbit insurance activities of the group
are managed through SES’ insurance and reinsurance captive com-
panies based in Luxembourg. Both companies are regulated and
managed in accordance with the European Solvency II directive
and are therefore subject to strict supervision and governance rules
detailed in the companies’ governance manuals. The governance
structure of the companies is comprised of both companies’ Boards
of Directors, two committees (Investment and Underwriting) and
four key functions (Risk Management, Compliance, Actuarial and
Internal Audit).
•
A Satellite Insurance Policy is in place and regularly updated reflect-
ing the SES Board-approved insurance structure and approval
framework.
• ‘In-orbit Third Party Liability’ insurance is placed directly to the
market, i.e., not using the Captives. Such insurance covers all
SES in-orbit satellites in compliance with licensing and other
regulatory requirements in the various jurisdictions where SES
operates.
Treasury Management
In the area of treasury management, the following should be noted:
• Treasury activities take place within a framework approved by the
Board. This framework reflects the Group’s Treasury Policy which
is being regularly reviewed and updated.
• A clear segregation of duties, and assignment of bank mandates,
between members of SES management, Treasury and accounting
departments has been implemented.
• The Treasury function uses specific software that helps to ensure
the efficiency and control of foreign exchange (‘FX’) matters, inter-
est and liquidity management, and the implementation of SES’
hedging strategy for interest rate and foreign currency fluctuations.
To ensure enhanced security and efficiency of the bank payments
process, the Company uses a banking payments system allowing
for secured authorisation and transfer of payments from SAP
directly to the bank.
• Treasury activities are monitored with the monthly Group Finance
Report. The report is issued to the SES Board and highlights key
performance indicators such as cash balance, leverage, and debt
maturity profile.
• A Treasury Roadmap, based on SES’ strategic and business plans,
is prepared, and presented to the CFO on an annual basis.
Tax Management
Regarding the internal controls in tax management, the following
should be noted:
•
The tax arrangements of the group are driven by its operational
requirements and the geographical location of its business activities.
The Tax department works closely with the business to provide
clear, timely and relevant advice, as well as to mitigate tax risks.
• Tax positions are analysed based on the most appropriate authori-
tative interpretations and reported in internal tax technical memos
or tax opinions from external tax consultancy firms.
•
Tax positions are recorded in the Group’s financial statements
applying a key control hierarchy to ensure that all the relevant infor-
mation and data is properly understood and reconciled.
•
Transfer pricing documentation is continuously updated and
improved underpinning all significant cross-border intercompany
transactions through functional and economic analyses including
benchmarking studies.
•
A policy is in place concerning the mandatory automatic disclosure
in the field of taxation on reportable cross-border arrangements as
part of the SES Tax Control Framework.
Satellite Operations
Regarding the internal controls in satellite operations, the following
should be noted:
• SES’ Technology department is responsible for the procurement of
satellites and launch vehicles, the procurement and maintenance
of satellite-related ground infrastructure and the administration,
control, and operations of the satellite fleet.
• The operational procedures for satellite control and payload man-
agement cover manoeuvres and configuration changes required in
nominal situations as well as in the case of technical emergencies.
The controllers are trained and certified in the execution of such
procedures which are periodically reviewed and updated. Satellite
control software is being used and fully validated electronic proce-
SES ANNUAL REPORT 202176
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ENVIRONMENTAL,
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CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
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SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
dures for station-keeping and other regular operations are being
applied across the entire SES fleet.
• SES has designed satellite contingency and emergency response
process, crisis management systems, supporting infrastructure and
tools to address satellite in-orbit anomaly situations at an appro-
priate management level. SES applies industry-standard incident
management, escalation, and reporting processes to provide effec-
tive and timely support to customers.
• SES has adequate satellite control primary and backup capabilities
utilising the European and US-based Satellite Operations Centres
(‘SOCs’). SOCs can take over the operations of the other in an emer-
gency with the fail-over procedure being tested regularly. SOCs
can also be controlled remotely from any other dedicated location
via secure internet connection if the situation would require it.
• For SES Infrastructure Redundancy, adequate backup capabilities
are implemented.
•
The COVID-19 situation did not require changes to the existing
satellite operations, procedures and preventive measures that have
been implemented to ensure continuous and safe satellite opera-
tions continued to be applied during 2021.
Global Services
Regarding the internal controls in the area of Global Services, the
following should be noted:
• SES’ Global Services is responsible for the operation and manage-
ment of the customer-facing network, video services and content
operations including the maintenance and oversight of systems
and network components supporting SES customer traffic and
video services.
• The monitoring and operational procedures address static state as
well as anomalous states of network operations. All engineers are
trained in the execution of such procedures which are periodically
reviewed and updated. SES uses multiple tools and software to
manage and monitor the network and these tools have redundancy
enabled in the event of a systemic anomaly.
•
Network operations and payload management is performed in
Network Operations Centres (‘NOCs’) mainly located in US and
Europe. Video operations centres are in Israel and Europe. SES has
instituted disaster recovery procedures and handover to other sites
is possible and regularly tested.
•
SES applies industry-standard incident management, escalation,
and reporting processes to provide effective and timely support to
customers.
• Under COVID-19 restrictions, NOCs can be completely controlled
remotely, accessing the relevant monitoring systems via secure
internet connections.
•
The Vendor Management & Procurement (‘VMP’) function supports
the business for the non-satellite procurement, governed by a
dedicated policy that sets the frame for a sound level of internal
control when purchasing. The supply chain function within VMP
optimises and streamlines the exchange of goods or services
covering demand planning, logistics and warehouse management.
Controls are in place to ensure effective workflows, efficient use of
resources and safeguard legal constraints (e.g., inventory tracking,
shipment and custom documentation, US export controls).
Information Technology
Regarding the internal controls in the area of information technology,
the following should be noted:
•
Management is committed to ensuring that SES’ data, infrastructure,
and information technology systems are as secure as is reasonably
practicable. Security controls, policies and procedures are in place
to prevent unauthorised access to premises, computer systems,
networks, and data. Policies and procedures are continuously being
reviewed and updated.
• SES applies an Information Security Management System (‘ISMS’)
in line with the ISO 27001 standard which is subject to regular
ISO 27001:2013 certification for the scope of data services delivered
through high throughput GEO satellites.
• The SES Azure Cloud Platform has been put in place and, most of
its features have been added to the SES environment. The Cloud
Centre of Excellence program with Microsoft has been completed
and is fully operational.
•
All SES’ main trading operations operate on a common SAP ERP
platform, applying consistent processes and controls. In 2021 the
SAP platform was moved into the Cloud. The process further con-
tinues to mature in various areas including data privacy, data
encryption and intrusion detection. The Cloud solution provides
state-of-the-art backup facilities to ensure enhanced continuity of
the SAP system. A comprehensive SAP security policy has been
defined and implemented. Appropriate SAP access management
is in place and is continually monitored and enhanced.
• SES has disaster recovery plans for its business applications. The
regular testing of these activities confirms that SES is in a good
position to recover all mission critical back-office applications
within its recovery time objectives. Electronic information is regu-
larly backed up and regularly tested.
•
A digital workflow process for managing information technology
development projects is in place on a ServiceNow platform further
enhancing the level of automation. Relevant key performance indi-
cators are regularly reviewed.
•
SES ensures adequate and secure VPN connectivity and redundancy
to cater for users to work remotely. More applications continue to
be progressively added onto our Multi-Factor authentication to
protect against unauthorised access due to password theft or pass-
word guessing attacks.
•
A dedicated cybersecurity team is in place to provide SES manage-
ment and customers with the assurance that our services are
adequately secured. We follow a holistic approach towards cyber-
security by implementing a wide range of security control mecha-
nisms and practices based on industry-leading standards, as well
as cultivating a culture of awareness and caution throughout our
organisation.
SES ANNUAL REPORT 202177
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
INFORMATION AND COMMUNICATION
Internal communication ensures the effective circulation of informa-
tion across the organisation and supports the implementation of inter-
nal control and risk management by communicating business and
functional objectives, instructions and information across all levels
and functions of SES via a wide array of communications channels.
To effectively manage the COVID-19 pandemic, multi-stage pandemic
plans with procedures and measures have been implemented to
ensure health and safety of all SES employees worldwide as well as
to protect our operations and to ensure continuity of services for our
customers and partners.
A dedicated and cross-functional internal taskforce coordinates the
Company’s response to the varying COVID-19 needs. The taskforce
ensures comprehensive communications to the SES community on
Company’s guidelines, decisions and safety measures taken in line
with guidance received from national governments, public health
agencies and the World Health Organisation.
With focus still on emergency preparedness and response, safeguard-
ing Company’s employees (e.g., working from home, limited travel),
business continuity and other implications (e.g., tax, cross-border
workers, testing) to best manage the ongoing pandemic, the team
started in 2021 to develop and implement a safe exit strategy with an
iterative back to office plan that has been implemented in line with
relevant local regulations.
MONITORING ACTIVITIES
Monitoring of business policies and procedures is done through
continuous assessments or through a specific analysis.
Continuous assessments are performed by management as routine
operations, built into business processes, and are performed on a
real-time basis, reacting to changing conditions.
The SES Internal Audit function performs specific analyses of the
relevance of, and compliance with, Company policies and internal
control procedures.
The objectives, authority, and responsibilities of the Internal Audit
function are set out in the Internal Audit Policy which is regularly
reviewed and updated.
To ensure an appropriate level of independence and communication,
the Internal Audit function has a direct reporting line into the Audit
and Risk Committee (‘ARC’) while reporting functionally to the
President and CEO of SES.
The activities of the Internal Audit function are executed in accordance
with an annual audit plan, which is reviewed and approved by the ARC.
This plan is prepared in close cooperation with the company’s Risk
Management Team to dynamically link it to risks and exposures that
may affect the organisation and its operations.
Internal Audit reports its observations and mitigation proposals to
management and monitors the implementation of the recommenda-
tions. Regular reports are provided to the Senior Leadership Team
and to the ARC summarising Internal Audit’s conclusions regarding
internal control effectiveness and compliance.
Internal Audit also regularly coordinates audit planning, and exchanges
relevant information with, the Company’s external auditor PwC.
The proxy structure of the SES Government Solutions Inc. entity, a
wholly-owned indirect subsidiary of SES S.A., in line with common
practice for businesses serving certain segments of the US Govern-
ment, imposes various restrictions on the Board and executive
management in directly supervising the maintenance of an internal
control system and imposing an internal audit structure. Hence the
Group’s own Internal Audit function does not perform direct internal
control reviews of this subsidiary. An agreement about required risk
management and internal control framework for that entity is in place
which is subject to evaluation and testing by a third-party audit
function.
The Group’s external auditor is also engaged for the audit of the
financial statements of SES Government Solutions.
SES ANNUAL REPORT 202178
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
PRINCIPAL RISKS
SES identified the following potential risks, which could have a material
and adverse effect on its business, financial condition and results of
operation. This section does not purport to be exhaustive, but rather
contains a summary of the main risks that SES may face during the
normal course of its business. Where mitigations are mentioned in
this section, there is no guarantee that such mitigations will be effec-
tive (in whole or in part) to remove or reduce the effect of a risk.
Risks relating to procurement
Dependency on key supplier(s) Dependency on a small number of satellite manufacturers may reduce SES’ negotiating power and access to advanced technologies and result in
increased satellite procurement risk (e.g., due to technical difficulties and design problems with a particular model of satellite). SES mitigates these risks
by maintaining a full level physical presence and oversight at manufacturer facilities throughout the spacecraft design, construction and acceptance.
SES monitors manufacturers’ supplier base and procurement sources and develops relationships with new suppliers where possible.
SES is dependent on a limited number of launch service providers. As such, delays may be incurred in launching satellites in the event of a prolonged
unavailability of service from a launch service provider.
Launch delay(s) and / or launch failure(s) Launch delays are a possibility. Satellite launch and in-orbit insurance policies do not compensate for lost revenues and other consequential losses.
SES attempts to mitigate the risk of delays by ensuring adequate margins in satellite procurement schedules.
There is always a small but inherent risk of launch or early-orbit failure, resulting in a reduced satellite lifetime and/or functionality or the total loss of
a satellite. SES mitigates such risks in several ways, including by technical risk management of each launch vehicle programme and asset insurance for
each launch.
Risks relating to satellites
In-orbit failure(s) A satellite may suffer in-orbit failures ranging from a partial impairment of its commercial capabilities to a total loss of the asset. Such failure may result
in SES not being able to continue to provide service to some of its customers.
SES attempts to mitigate this risk by careful vendor selection and high quality in-orbit operations. For some services, SES is able to offer an in-orbit
backup strategy in which customers using an impaired satellite may be transferred to another satellite.
In addition, in respect of its geostationary (‘GEO’) satellites, SES has restoration agreements with other satellite operators whereby customers on an
impaired GEO satellite may be transferred to a GEO satellite of another operator in order to protect continuity of service.
Risks relating to space insurance
Insurance coverage and availability SES maintains pre-launch, launch and initial in-orbit insurances, in-orbit insurance, and third-party liability insurance. These policies generally contain
customary market exclusions and are subject to limitations.
The insurance market has been seeing a reduced availability and significantly increased rates. This results in increased insurance premiums for SES.
In order to mitigate these risks and optimise the coverage and premiums, SES maintains a policy of limited self-insurance through its captive entities.
SES ANNUAL REPORT 202179
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ANNUAL
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6
ADDITIONAL
INFORMATION
Risks relating to customers
Key customer loss Bankruptcy and customer consolidation, amongst other reasons, can potentially result in loss of customers, non-renewals or reduction in the demand
for services. SES aims for long contract terms with key customers based on strong relationships.
Customer credit
Failure by customers to fulfil payment obligations is a possibility. Credit risk may increase as SES and / or its customers increase dependency on
revenues in emerging markets where credit risk may be higher. This risk is mitigated through a customer credit policy including credit checks, deposits
or other forms of security, payment monitoring and credit insurance where possible. Further details are provided in >> Note 18 to the consolidated
financial statements.
Risks relating to the satellite communications market
Competition The satellite communications business is increasingly competitive. SES competes with national, regional and international GEO, non-geostationary
(NGSO) and fixed and wireless terrestrial operators. The competition from NGSO systems is potentially the most disruptive trend facing SES. With
strong financial backing, vertical integration and technological advancements, such competitors are planning to enter multiple markets targeted by SES.
In addition, the trend towards horizontal and vertical consolidation poses the risk of leaving SES behind with a smaller, less powerful relative market
position towards customers as well as suppliers.
SES regularly evaluates potential partner or merger targets that fit with its strategy.
Technology The satellite communications industry is subject to rapid technological change. As a result, the technology used by SES could become less suitable for
customer requirements leading to a reduced service demand and a negative revenue impact.
Risks relating to strategic development
Emerging market SES targets new geographical areas and emerging markets and is developing commercial arrangements with local communications, media and other
businesses in these areas. SES may be exposed to political and other risks associated with such business.
Investment SES’ desired strategic investments may not yield expected benefits due to a number of factors including uncertain or changing market conditions,
financing costs and legal and regulatory issues.
SES ANNUAL REPORT 202180
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ANNUAL
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INFORMATION
Risks relating to legal, regulatory, spectrum, and corporate
Legal & Regulatory SES’ operations and business are subject to compliance with the laws, regulations (e.g., communications, export control, sanctions, competition) and
political will of the governmental authorities of the countries in which SES operates, uses radio spectrum, offers satellite capacity and services.
Violations of any of the applicable laws and regulations could expose SES to penalties and other enforcement actions and may negatively affect
commercial operations.
SES may need to obtain and maintain approvals from authorities or other entities to operate its satellites and to offer satellite capacity and services.
Failure to obtain the necessary approvals could lead to loss of revenues and compliance actions against SES.
Spectrum The International Telecommunication Union (‘ITU’) and national administrations may reallocate satellite spectrum to other uses. In addition, national
administrations are increasingly charging for access to spectrum through the use of fees and auctions. This may affect SES’ access to orbital locations
and frequencies required for it to develop and maintain its satellite fleet and services.
In addition, SES must coordinate the operation of its satellites with other satellite operators so as to prevent or reduce interference. As a result of such
coordination, SES may be required to modify the proposed coverage areas or satellite design or transmission plans which may materially restrict satellite
use. Similarly, the performance of SES’ satellites in some areas could be adversely affected by harmful interference caused by other operators to SES’
satellites.
Operational issues such as satellite launch failure, launch delay or in-orbit failure might compromise access to the spectrum or orbital locations.
SES’ large fleet may enable the relocation of in-orbit satellites to satisfy regulatory and spectrum requirements.
Cybersecurity SES’ operations may be subject to hacking, malware and other forms of cyber-attack. Due to the high sophistication of certain attackers and an
increasing number of cyber-attacks, it may not always be possible to prevent every such event.
SES has protections in place to help protect its systems and networks and continues to work to implement additional protective measures intended
to limit the risks associated with such attacks.
Personnel SES is competing for talent with satellite operators as well as large and well-known companies. In the context of low unemployment rates and a shortage
of qualified candidates, SES may have difficulties in hiring competent talent. If SES is unable to source and retain key talent this could have a negative
impact on SES’ ability to deliver its business objectives.
To mitigate this risk SES uses a dedicated Talent Acquisition function to source high-quality candidates.
Global pandemic or other health emergency SES is subject to the risk of a global pandemic or other health emergency such as COVID-19. Worsening of COVID-19 or appearance of another material
health emergency could affect availability of our employees and impact various areas of SES’ business including procurement and launch of satellites,
entry into service of new satellites, procurement of ground infrastructure and provision of services to customers. SES has procedures and measures to
respond to health risks and to secure business continuity during such situations.
SES ANNUAL REPORT 202181
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Risks relating to finance
Credit rating SES’ credit rating can be affected by a number of factors, including a change in its financial policy, a deterioration of its financial credit metrics,
a downgrade in the rating agencies’ assessment of the business risk profile or a change in rating methodology. A change in SES’ credit rating could
affect the cost and terms of its newly issued debt, as well as its ability to raise financing. SES’ policy is to attain and retain a stable investment grade
rating with two of the international reputed Credit Rating Agencies (currently Standard & Poor’s and Moody’s).
Tax SES is subject to taxation in multiple jurisdictions and may become subject to unforeseen material tax claims, including late payment interest and / or
penalties, and in some cases retroactive tax assessments.
SES has implemented a tax risk mitigation charter based on, among other things, a framework of tax opinions for the financially material positions taken,
transfer pricing policies, and procedures for accurate tax compliance in all jurisdictions.
Asset impairment
SES’ intangible assets, satellites and ground segment assets are valued at historic cost less amortisation, depreciation and accumulated impairment
charges. The resulting carrying values are validated each year through impairment testing procedures where they are compared to the discounted
present value of the future cash flows expected to be derived from the asset. Where future assumptions for a specific asset, as set out in the approved
Business Plan, become less favourable, or the discount rates applied to the future cash flows increase, then this may result in the need for material asset
impairment charges.
Foreign exchange
SES’ reported financial performance can be impacted by movements in the Euro / U.S. dollar exchange rate, as SES has significant operations, cash flows,
assets and liabilities that are denominated in the U.S. dollar, whereby the Group’s reporting currency is the Euro.
To mitigate this exposure, SES may enter into forward foreign exchange or similar derivative contracts to hedge underlying foreign exchange exposures.
Further details are provided in >> Note 18 to the consolidated financial statements.
Interest rate
SES’ exposure to the risk of changes in market interest rates relates primarily to SES’ floating rate borrowings as well as the renewal of its fixed rate
borrowings.
SES carefully monitors and adjusts the mix between fixed and floating rate debt from time to time, responding to market conditions. Interest rate
derivatives may be used to manage the interest rate risk. Further details are provided in >> Note 18 to the consolidated financial statements.
RESPONSIBILITY STATEMENT
The Board of Directors and the Executive Committee of the company
reaffirm their responsibility to ensure the maintenance of proper
accounting records disclosing the financial position of the group with
reasonable accuracy at all times and ensure that an appropriate sys-
tem of internal controls is in place to ensure the group’s business
operations are carried out efficiently and transparently.
In accordance with Article 3 of the Luxembourg law of 11 January
2008, as subsequently amended, on transparency requirements in
relation to information about issuers whose securities are admitted
to trading on a regulated market, we declare that, to the best of our
knowledge, the annual statutory accounts as of and for the year ended
31 December 2021, prepared in accordance with Luxembourg legal
and regulatory requirements, and the consolidated financial state-
ments as of and for the year ended 31 December 2021, prepared in
accordance with the International Financial Reporting Standards as
adopted by the European Union, give a true and fair view of the assets,
liabilities, financial position and profit of the year of SES taken indi-
vidually, and of SES and its consolidated subsidiaries taken as a whole,
respectively. In addition, the management report includes a fair review
of the development and performance of the business and the position
of SES taken individually, and of SES and its consolidated subsidiar-
ies taken as a whole, together with a description of the principal risks
and uncertainties that they face.
23 February 2022
Frank Esser Steve Collar
Chairman of the Board of Directors CEO
SES ANNUAL REPORT 202182
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
REMUNERATION REPORT
PURPOSE AND SCOPE OF THE
REMUNERATION POLICY
The purpose of the present Policy is to describe the remuneration
paid by the Company to the Directors and to the members of its Exec-
utive Committee (SLT members). It describes:
• How it contributes to the Company’s objectives relating to its busi-
ness strategy and long-term interests and sustainability;
• The different components of remuneration, including all bonuses
and other benefits in whatever form, if any, awarded to Directors
and SLT members and indicates their relative proportion;
• The duration of the contracts or arrangements with the Directors
and SLT members, the applicable notice periods, the main charac-
teristics of supplementary pension or early retirement schemes and
the terms of, and payments linked to, termination;
•
The decision-making process followed for the determination, review
and implementation of the Policy, including measures to avoid or
manage conflicts of interests and, where applicable, the role of the
Remuneration Committee and the Board;
•
The procedural conditions under which any derogation from the
Policy can be applied as well as the elements of the Policy from
which a derogation is possible.
THE REMUNERATION POLICY
The Company must attract suitable Directors and SLT members to
continue its success and remuneration is one of the enablers to fulfil
this goal.
Remuneration must reflect the degree of required qualifications and
experience of the Directors and SLT members, the risks that they take
personally, and honour the dedication and efforts that the Directors
and SLT members put into the Company. The Remuneration must
also be consistent when compared to remunerations for similar roles
in other companies and be relative to the pay and employment con-
ditions of the employees of the Company.
REMUNERATION OF THE DIRECTORS
The remuneration granted to Directors consists of a fixed annual fee,
and a fee per Board or committee meeting attended as described
below.
All these fees are net of any Luxembourgish withholding taxes on
directors’ fees. Board members do not receive any stock options, nor
do they receive any bonus.
Fixed remuneration per year
The fixed component of the remuneration amounts to €40,000 per
year whereas the Vice Chairpersons each receive an annual fixed fee
of €48,000 and the Chairperson receives a fee of €100,000 per year.
Any Director chairing one of the committees set up by the Board (if
not the Chairperson of the Board) receives an annual fee of €8,000.
The Chair of the Audit and Risk Committee (if not the Chairperson of
the Board) receives an annual fee of €9,600.
Remuneration per meeting
Directors receive €1,600 for each Board meeting or Board committee
meeting they attend, except for the Audit and Risk Committee for
which a fee of €1,920 per meeting is paid.
It is important to note that a Director participating in more than one
committee meeting on the same day will receive the attendance fee
for one meeting only. Half of the attendance fee is paid if the Direc-
tor participates in the meeting via telephone or videoconference.
However, as an exceptional measure during the application of the
COVID-19 restrictions, directors participating in meetings via Video-
conference are paid full attendance fees.
The terms of the Directors
In general, the Company’s directors are elected for terms of three
years. If a Director leaves the Board during his/her term, the Company
may co-opt a Director to finish that mandate.
A Director can be revoked at any moment by the shareholders. There
is no notice period for a Director.
The maximum tenure on the Board is limited to 12 years (generally
four terms of 3 years each).
The age limit of the Directors is set at 72 years. Any Director who
reaches this age during his/her mandate will resign at the Annual
General Assembly (AGM) following this date.
REMUNERATION OF SLT MEMBERS
The remuneration of SLT members comprises the following two major
components:
• The compensation package which consists of a Yearly base salary
(“YBS”), Annual bonus (“AB”), and Long-term equity (“LTE”);
•
The benefits including, but not limited to, company car or car allow-
ance, pension and health care plans, and death and disability insur-
ance.
In line with the Charter of the Remuneration Committee of the Com-
pany, remuneration matters of the SLT members are decided by the
Board after review and recommendations from the Remuneration
Committee.
SES ANNUAL REPORT 202183
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Yearly Base Salary (“YBS”)
The base salary of the CEO as well as of other SLT members is
reviewed by the Remuneration Committee in its first ordinary meet-
ing of the year. The Board has the sole authority, besides the legally
required cost of living adjustments (i.e. Luxemburg index), to adjust
the YBS of the CEO and other SLT members.
For all new nominations as SLT member, remunerations are validated
by the SES Board, on recommendations from the Remuneration Com-
mittee. They are made on the basis of external benchmarks provided
by compensation consultants while also considering degree of qual-
ification and experience required as well as employment conditions
of employees at the time of the offer.
Annual Bonus (“AB”)
The main objective of the bonus plan for the CEO and other SLT mem-
bers is to create a performance reward scheme, that links annual
variable compensation to the Company’s financial results and its per-
formance against specific business objectives which include sustain-
ability targets. Through this plan, the Company ensures alignment
and focus on the company’s core objectives.
The AB of SLT members is based on the annual performance during
the relevant calendar year, is assessed by the Remuneration Commit-
tee and validated by the Board in February and paid in March of the
following year.
AB achievements (financial results and performance against business
objectives) are reported in the annual Remuneration Report.
The AB target for SLT members ranges from 50% of the YBS to 100%
of the YBS for the CEO.
The minimum pay-out can be as low as 0% of the AB (in other words
no bonus payment), with a maximum pay-out capped at 150% of the
bonus target.
The AB of each SLT member is composed of two parts:
• Financial performance (70% of the AB); and
• Business objectives (30% of the AB).
The financial performance measures the actual achievement com-
pared with budget for the following set of metrics with their respec-
tive weights: Revenue (40%), EBITDA (40%) and net operating cash
flow (20%). The budget targets for those measures are set during the
annual budget process and finally approved by the Board.
The financial performance pay-out is capped at 150% of the bonus
target (for a 107% target achievement and for each of the three met-
rics separately) and with a performance threshold, below which no
compensation is paid, set at 88% achievement and as shown below:
Finance performance pay-out table
The business objectives are set annually by the SES Board at the
beginning of each year. They are related to the strategic roadmap of
the company and include ESG goals.
Achievement is measured at the end of each performance year by the
Board, based on recommendations provided by the Remuneration
Committee.
The pay-out for business objectives can be as low as 0% and is capped
at 150% of the bonus target.
Only in very rare circumstances, the Board can apply a multiplier
between 0.5x and 1.5x on the overall achievement against objectives
either (i) to mitigate the impact of extraordinary circumstances, such
as COVID-19 when a 0.5x multiplier was applied on the 2020 bonus
payment or (ii) to recognise successful achievement of transforma-
tional projects expected to generate significant shareholder value
such as the release of the first C-band clearing milestone, leading to
a multiplier of 1.5x on the 2021 bonus payment.
Long-Term Equity (“LTE”)
The LTE is regulated by the Equity Based Compensation Plan (EBCP).
The objective of the EBCP is to enhance the competitiveness of the
Company and its affiliates in attracting and retaining the best global
leadership talent, and to position the Company as a global employer
of choice. Moreover, the EBCP is designed to ensure that SLT mem-
bers become shareholders of the Company, feel a sense of ownership,
and benefit from their contribution to increasing shareholder value.
To this end, the EBCP provides a framework for the grant or award of
equity-based incentive compensation in the form of:
• Restricted shares, representing one sixth of the LTE grant,
•
Performance shares, representing one half of the LTE grant and
with a vesting which is subject to financial criteria and
• Stock options, representing one third of the total LTE grant.
The annual grant is approved by the Board in its April meeting based
on a recommendation from the Remuneration Committee.
0%
40%
80% 90% 100% 110%
120%
20%
60%
80%
100%
120%
140%
160%
Payout factor
Target achievement
SES ANNUAL REPORT 202184
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
For SLT members, the annual LTE grant value ranges from 58% of
their YBS to 105% of the YBS for the CEO.
Restricted Shares
The restricted shares are FDRs granted with the sole condition that
at the day the restricted shares vest, the SLT member is employed
by the Company. The restricted shares vest on 1 June of the third
year following the year of the grant.
The number of restricted shares granted is determined by multiply-
ing the relevant YBS with the applicable percentage and divided by
an average of 15 days closing prices of the Company’s FDRs at the
Paris stock exchange, which is reviewed by the Remuneration Com-
mittee for each grant year.
Performance Shares
Performance shares are FDRs granted to SLT members with vesting
subject to achievement of financial criteria. The performance shares
vest on 1 June of the third year following the year of the grant.
The number of performance shares granted is determined by multi-
plying the relevant YBS with the applicable percentage and divided
by the average 15 days measured share price.
Starting with 2021 grant, Total Shareholder Return (“TSR”) is the met-
ric retained to assess financial performance. It is measured on a rel-
ative basis to the median TSR performance of a panel of comparable
companies during the vesting period with:
• Share price at the end to be based on the average share price in
the 3-month period February – April preceding the vesting date i.e.,
from 1 February 2024 to 30 April 2024 for 2021 grant, and retaining
dealing days only
•
With share price at the beginning to be based on the average share
price during a 3-month period February – April of the grant year
i.e., from 1 February 2021 to 30 April 2021 for 2021 grant and retain-
ing dealing days only
• Measurement is based on Volume Weighted Average Price
• Outcome will be reviewed by the Remuneration Committee prior to
the Share Vesting Date
The comparator group is reviewed on a regular basis by the Remu-
neration Committee and is determined based on multiple factors such
as company size, business mix, geographic mix and TSR correlation.
Unless otherwise specified by the Remuneration Committee, the Per-
formance Shares will vest on the Share Vesting Date, subject to the
Participant’s continued employment with the Company or an Affiliate
and to the following ratchet table which will apply to determine the
proportion of Performance Shares that will vest:
Performance Shares ratchet table
Stock Options
The stock option is a standard call option with a maturity of 10 years
from the date of the option grant.
The final strike price corresponds to the average of 15 days closing
prices of the Company’s FDRs at the Paris stock exchange after the
allocation of options by the Board.
The grant value is determined by the multiplication of the YBS with
the applicable percentage.
The number of stock option units is derived directly by dividing the
grant value by the value of the stock option which is computed by an
external and independent valuation firm and using a Binomial or
Black-Scholes valuation. The final stock option valuation of each grant
is then approved by the Board.
The stock options must vest before they can be exercised. Starting
with 2021 grant, the vesting period of stock options is a three-year
cliff vesting schedule for closer alignment with best market practices.
As an example, if 100 stock options are granted in 2021, all units vest
and can be exercised as of 1 June 2024.
The SLT members must, when exercising their vested stock options
and their vested shares, do this in accordance with the regulations of
the French stock market authorities AMF and the SES Code of deal-
ing securities (i.e. require the prior authorization from the Deputy
Corporate Secretary and/or Chief Financial Officer, outside closed
periods). As for the members of the Board, the exercises by the SLT
members are reported on the Company’s website under Company
> About Us > ESG > Corporate Governance > Management Disclosures.
0%
25%
[0-75%]
75% 100% 125% 150%
50%
75%
100%
125%
150%
175%
Proportion of performance shares that vest (in %)
Achievement – TSR performance vs. panel (in %)
Threshold
Maximum
SES ANNUAL REPORT 202185
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Benefits
The following key benefits are provided to SLT members, the amount
of which is aligned with local practices:
• Pensions and health care plans: in Luxembourg, pension contribu-
tions of 7% up to the Social Security Ceiling (SSC) and 19% for the
portion of salary above the SSC. The complementary pension
scheme is a defined contribution scheme. In the US, restoration
plans are in place to provide retirement benefits that supplement
the tax-qualified, defined-contribution pension account defined in
subsection 401(k) of the United States Internal Revenue Code; in
the Netherlands, pension contributions are age-related and
employer contribution is capped at 20.2% of the maximum pension-
able salary;
• Health check-up;
• Death and disability insurances; and
• Company car or car allowances.
In addition to the above, several SLT members benefit from tax sup-
port and reimbursement of education fees for dependent children.
Employment, Resignation and Termination
SLT members are hired on a permanent basis and employment con-
tracts are drafted according to local regulations:
• One SLT member has an employment contract with an American
subsidiary of the Company.
• One SLT member has an employment contract with a Dutch sub-
sidiary of the Company.
• All other SLT members have employment contracts with the Com-
pany or a Luxembourg subsidiary of the Company.
In case of resignation or termination, any unvested portion of out-
standing stock options, restricted and performance shares is imme-
diately forfeited. This excludes members leaving the Company due to
disability or for retirement, benefitting from an immediate vesting of
all unvested equity.
The Company and the SLT member can terminate the employment
contract respecting the legal notice period. For the SLT member with
an employment contract with an American subsidiary of the Company
the employment contract stipulates a notice period of 30 days in case
of termination or resignation.
With exception of one member, all members of the SLT are entitled
to two years of YBS in case of termination without cause. The indem-
nity includes statutory severance payment, if any.
SLT SHARE OWNERSHIP PROGRAM
This program aims at assuring that SLT members become sharehold-
ers of the Company, feel a sense of ownership, and focus on creating
shareholder value.
The SLT members have an obligation to invest in the Company’s
equity under the form of registered shares and/or FDR’s. Over a period
of five years (with equal yearly investment), the SLT members have
to hold in total one time their YBS and the CEO two times his YBS.
SHAREHOLDER VOTE
The present Policy will be submitted to a shareholder vote at the next
Annual General Meeting. The policy will be submitted to the share-
holders at a minimum every three years or sooner in case of material
changes.
While the vote by the shareholders at the general meeting is advisory
only, the Company will pay its Directors and SLT members only in
accordance with a remuneration policy that has been submitted to a
vote at the general meeting. If the general meeting rejects the pro-
posed remuneration policy, the Company will submit a revised policy
to a vote at the following general meeting.
DISCLOSURE
After the vote of the shareholders this Policy together with the date
and the results of the vote shall be made available on the website of
the Company where it will remain publicly available, free of charge, as
long as it will be applicable.
PERIODIC REVIEW
This Policy shall be reviewed on a regular basis, but at least every
three years.
The Remuneration Committee shall be responsible for advising the
Board on any concrete amendment suggestions to this Policy. The
final version that will be submitted to the shareholders will be
approved by the Board.
In line with the Shareholder Rights Law of 1 August 2019, the SES
Board adopted a Remuneration Policy that was formally submitted to
the shareholders at the annual general meeting on 1 April 2021. An
updated Remuneration Policy will be submitted to the Board on
23 February 2022 prior to its submission to the shareholders at the
annual general meeting on 7 April 2022.
The remuneration report here below describes the remuneration of
the Board of Directors, the CEO and of the other SLT members. It has
been drafted in accordance with the above-mentioned Remuneration
Policy and will also be submitted to the shareholders at the same
meeting.
SES ANNUAL REPORT 202186
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
REMUNERATION REPORT
DIRECTORS REMUNERATION
In 2021, the Annual General Meeting of shareholders has approved
the remuneration of the Members of the Board of Directors through
approving a resolution that has been submitted by the Board of Direc-
tors.
The shareholders decided to maintain the fees paid to the directors
at the previous year’s level with a majority of 99.31%. The fees paid to
the Board have not been increased since 2008, except for the fees
paid to the Chair and the members of the Audit and Risk Committee
which have been increased in 2015 in line with best practices.
Directors each received a fixed fee of €40,000 per year, whereas each
of the Vice Chairs received an annual fixed fee of €48,000 and the
Chair received a fee of €100,000 per year.
The directors chairing one of the committees set up by the Board, if
not the Chair of the Board of Directors, received an additional remu-
neration of €8,000 per year. The director chairing the Audit and Risk
Committee received an additional remuneration of €9,600 per year.
Attendance fees for each Board or Board Committee meeting
amounted to €1,600, except for the meetings of the Audit and Risk
Committee for which directors received €1,920 per meeting. A direc-
tor participating in more than one committee meeting on the same
day received the attendance fee for one meeting only.
As an exceptional measure during the application of the COVID-19
restrictions, directors participating in meetings via Videoconference
were paid full attendance fees instead of half.
All fees are net of any Luxembourg withholding taxes.
The total net remuneration fees expensed for the year 2021 to the
members of the Board of Directors (net of the Luxembourg withhold-
ing tax) amounted to €904,853 of which €550,933 represented the
fixed part of the Board fees, with the remaining €353,920 being vari-
able fees. The gross overall figure (including withholding taxes) for
the year 2021 was €1,131,067. This compares to a gross remuneration
of €993,633 in 2020. This increase is exclusively driven by a higher
number of meetings.
The 2021 remunerations cover the fees paid for ten Board meetings
as well as for the meetings of the Board Committees described in the
table below. The amounts relate to the Board fees expensed during
the year 2021.
During 2021, the Board and the Committees of the Board were com-
posed as follows:
• Frank Esser, Chair
• Tsega Gebreyes, Vice-Chair
• Anne-Catherine Ries, Vice-Chair
• Serge Allegrezza
• Peter van Bommel
• Béatrice de Clermont Tonnerre
• Paul Konsbruck (until December ‘21)
• Ramu Potarazu
• Kaj-Erik Relander
• Françoise Thoma
• Katrin Wehr-Seiter
• Jacques Thill (from December ‘21)
The composition of the committees, chairs and members is provided
as follows:
Committee Membership and Meetings
Audit and
Risk Committee
Nomination
Committee
Remuneration
Committee
Strategy
Committee
Chair
Katrin Wehr-Seiter
(until August)
Peter van Bommel
(as of August)
Anne-Catherine
Ries
Françoise Thoma Frank Esser
Members
Serge Allegrezza Béatrice de
Clermont Tonnerre
Serge Allegrezza Peter van Bommel
Françoise Thoma Frank Esser Peter van Bommel Béatrice de
Clermont-Tonnerre
Kaj-Erik Relander Tsega Gebreyes Frank Esser Ramu Potarazu
Paul Konsbruck
(until December)
Ramu Potarazu Paul Konsbruck
(until December)
Kaj-Erik Relander Katrin Wehr-Seiter Jacques Thill
(as of December)
Jacques Thill
(as of December)
Number of Meetings and attendance rate in %
2 Hybrid
Meetings and
3 Calls
100%
2 Hybrid
Meetings and
2 Calls
100%
2 Hybrid
Meetings and
4 Calls
100%
9 Calls
98%
SES ANNUAL REPORT 202187
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
The detailed overview of the individual remunerations expensed in
2021 and 2020 to each Director is provided as follows.
Directors Remuneration
2021 (for Meetings Q1 2021 to Q4 2021)
1
2020 (for Meetings Q1 2020 to Q4 2020)
1
IN €
Directors
Remu -
ner ation
Attendance
Fees Taxes Total
Directors
Remu-
ne ration
Attendance
Fees Taxes Total
Serge Allegrezza 40.000 31.680 17.920 89.600 40.000 22.560 15.640 78.200
Romain Bausch – – – – 35.000 14.400 12.350 61.750
Peter van Bommel 47.200 44.480 22.920 114.600 30.000 10.880 10.220 51.100
Victor Casier – – – – 10.000 2.560 3.140 15.700
Beatrice de Clermont-Tonnerre 40.000 33.600 18.400 92.000 30.000 9.600 9.900 49.500
Frank Esser
100.000 36.800 34.200 171.000 81.667 15.200 24.217 121.083
Tsega Gebreyes 54.000 27.520 20.380 101.900 48.000 15.200 15.800 79.000
Paul Konsbruck 40.000 32.000 18.000 90.000 40.000 16.000 14.000 70.000
Hadelin de Liederkerke Beaufort – – – – 10.000 800 2.700 13.500
Ramu Potarazu 40.000 35.200 18.800 94.000 40.000 17.920 14.480 72.400
Kaj-Erik Relander 40.000 30.080 17.520 87.600 40.000 18.400 14.600 73.000
Anne-Catherine Ries 56.000 20.800 19.200 96.000 56.000 19.200 18.800 94.000
Marc Serres – – – – 10.000 4.000 3.500 17.500
François Tesch – – – – 10.000 5.600 3.900 19.500
Françoise Thoma 48.000 28.480 19.120 95.600 48.000 24.160 18.040 90.200
Katrin Wehr-Seiter 42.400 31.680 18.520 92.600 49.600 20.160 17.440 87.200
Jacques Thill 3.333 1.600 1.233 6.167 – – – –
Total
550.933 353.920 226.213 1.131.067 578.267 216.640 198.727 993.633
1 Board and Board Committee meetings held during the COVID-19 pandemic are considered as held physically.
REMUNERATION OF THE MEMBERS OF THE SLT
The remuneration of the members of the SLT is determined by the
Board and is based on recommendations from the Remuneration
Committee.
The remuneration of the SLT members comprises two major compo-
nents:
•
Compensation package composed of the yearly base salary; an
annual bonus; and long-term equity (LTE); and
• Benefits package which is aligned with local and market practices
The average to highest compensation ratio (comprising annual base
salary, bonus and equity at target) for all employees at the level of
SES S.A. is at 1 to 14 which remains below market benchmarks and
ratios which can be observed in CAC 40 or FTSE 100 companies.
Eight members were active in the SLT for the full year 2021:
• Chief Executive Officer (CEO), Steve Collar
• Chief Development Officer, Christophe De Hauwer
•
Chief Executive Officer of SES Networks, John-Paul Hemingway
(Chief Strategy and Product Officer as from 1 January 2022)
• Chief Human Resources Officer, Evie Roos
• Chief Technology Officer, Ruy Pinto
• Chief Services Officer, John Baughn
• Chief Legal Officer, Thai Rubin
• Chief Financial Officer, Sandeep Jalan
SES ANNUAL REPORT 202188
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
The total remuneration of the CEO and other SLT members follows
the principles set out in the Remuneration policy and is provided in
the tables below.
2021 Remunerations
IN €
Annual
Base Salary
Annual
Bonus
1
Long Term
Equity
2
Pension
Expenses
Other Benefits
and Payments
3
Total
Average
to highest
compensation
ratio at the level
of SES SA
4
Chief Executive Officer 735.438 1.038.732 655.129 125.428 53.114 2.607.840 14x
Other SLT Members 2.520.613 2.591.530 1.467.869 286.416 367.373 7.233.802 6x
Total 2021
3.256.051 3.630.262 2.122.998 411.844 420.488 9.841.642 –
2020 Remunerations
IN €
Annual
Base Salary
Annual
Bonus
1
Long Term
Equity
2
Pension
Expenses
Other Benefits
and Payments
3
Total
Chief Executive Officer 735.438 367.719 718.844 125.865 53.112 2.000.977
Other SLT Members 2.584.984 934.957 1.407.047 376.857 737.247 6.041.091
Total 2020
3.320.421 1.302.675 2.125.891 502.721 790.359 8.042.068
1 2021 bonuses are calculated with a 1.5x multiplier to recognize the successful collection of the first tranche of accelerated payments from the C-Band trans-
action. 2020 bonuses include a 50% reduction in bonuses for SLT members, as part of a series of cost savings measures implemented to mitigate the impact
of the pandemic crisis.
2 Amortization of Long Term Equity grants.
3 Other benefits and payments include health care plans, death and disability insurance, company cars or car allowances and other payments.
4 Average to highest compensation ratio (comprising annual base salary, bonus and equity at target) for all employees at the level of SES S.A.
Yearly Base Salary
The yearly base salary is reviewed annually by the Remuneration
Committee.
For new nominations, base salaries are set based on external bench-
marks while also considering the degree of qualification and experi-
ence required as well as the employment conditions at the time of the
offer.
Except for the Chief Executive Officer, yearly base salaries of SLT
members based in Luxembourg were adjusted in October 2021
following the legally required cost of living adjustment (Luxembourg
Index).
Annual Bonus
The main objective of the annual bonus plan is to create a perfor
-
mance reward scheme that links annual variable compensation to the
company’s financial results and the performance of the SLT against
specific business objectives.
The annual bonus of SLT members is composed of two parts: (i) the
financial performance of the company; and (ii) the performance
against business objectives, accounting for 70% and 30% of the bonus
respectively.
The financial performance measures group actual achievement vs.
budget for three elements, revenue (accounting for 40%), EBITDA
(accounting for 40%), complemented by net operating cash flow
(accounting for 20%). The Board of Directors sets annual targets dur-
ing the annual budget process and confirms annual achievement level.
In 2021, the Group financial performance payout was confirmed at
95.6% based on the weighted results for the three metrics.
The business objectives are set annually by the Board at the start of
each performance year and relate to the strategic roadmap of the
Company. For confidentiality reasons, budget targets as well as con-
tent of strategic business objectives will not be disclosed publicly.
Two of the important business objectives for 2021 were to (i) execute
on C-Band clearing and (ii) establish strong ESG practices. The SES
Board confirmed an achievement for 2021 of 90.8% which applies
equally to each SLT member including the CEO.
As an exception for 2021, bonus payout of each employee including
SLT members was multiplied by a factor 1.5x as part of a special incen-
tive to meet C-Band clearing deadline ahead of schedule and for the
collection of the first tranche of accelerated payments.
The 2021 annual bonus relates to the 2021 performance year and will
be paid in March 2022.
SES ANNUAL REPORT 202189
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
The overview of the 2021 annual bonus of the CEO and other SLT
members is provided in the table below:
Bonus SLT expense
IN €
Bonus
at target
(Abs.)
Bonus at target
(% of Base
Salary)
Maximum
award limit
(150%)
Percentage
achievement
Bonus
Amount
Bonus Amount
after 1.5x
multiplier
1
Chief Executive Officer – Annual Bonus 2021
performance year 735.438 100% 1.103.156 94,2% 692.488 1.038.732
- Financial Performance (70%) 514.806 772.209 95,6% 492.155 738.232
- Busines Objectives (30%) 220.631 330.947 90,8% 200.333 300.500
Other SLT Members – Annual Bonus 2021
performance year 1.843.263 50-80% 2.764.894 93,7% 1.727.687 2.591.530
- Financial Performance (70%)
2
1.290.284 1.935.426 95,0% 1.225.582 1.838.373
- Busines Objectives (30%) 552.979 829.468 90,8% 502.105 753.157
1 As an exception for 2021, bonus payouts of all employees including SLT members were multiplied by a factor of 1.5x as an incentive measure for meeting C-band clearing deadline
ahead of schedule and the collection of the first tranche of accelerated payments.
2 Financial performance of SLT members determined by outcome of group financial performance vs. Budget as well as the financial performance vs. Budget of business units (CEO
Networks).
Long Term Equity Incentives
The third element of the compensation package relates to the long-
term equity granted by the Company. The plan, administered by the
Remuneration Committee, permits the grant of three equity types: (i)
stock options; (ii) restricted shares; and (iii) performance shares. The
2021 total grant value was divided into one-third of stock options,
one-sixth of restricted shares, and one half of performance shares.
The stock option is a standard call option with a maturity of 10 years.
The final strike price is determined as the fair market value with an
average of 15 days closing prices at the Paris stock exchange after
the numbers of options have been determined by the Board. Stock
option grants prior to year 2021 have a vesting period of four years
with a yearly vesting of 25% on 1 January of each year following the
grant. For closer alignment with market practices, stock option grants
from year 2021 on have a three-year cliff vesting of 100% on 1 June
of the third year following the grant year.
The Restricted Shares are FDRs granted with the sole condition that,
at vesting, the SLT member must be employed by SES. The Restricted
Shares vest on 1 June of the third year following the year of their grant.
Performance Shares are FDRs granted to SLT members and vest on
1 June of the third year following the year of their grant. Performance
shares granted prior to year 2021 are subject to the outcome of the
compounded three years adjusted Economic Value Added (adjusted
EVA). From grant 2021 onwards, vesting is subject to outcome of Total
Shareholder Return (TSR), measured on a relative basis to the median
TSR performance of a panel of comparable companies during a three-
year period and with a maximum vesting of 150%. In 2021, the com-
parator group determined by the Remuneration Committee comprises
11 companies including satellite operators and European telcos,
selected based on multiple factors such as company size, business
mix, geographic mix and TSR correlation.
During 2021, the members of the SLT were awarded a combined total
of 953,598 options to acquire company FDRs at an exercise price of
€6.395 as well as 60,372 restricted shares as part of the company’s
long-term incentive plan and 181,116 performance shares. The CEO
was awarded 269,375 stock options, 17,054 restricted shares and
51,162 performance shares.
The detailed overview of the 2021 equity grant and vesting for the
CEO and other SLT members is provided as follows:
SES ANNUAL REPORT 202190
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Long Term Equity 2021
Long Term Equity Plan – 2021 Grant Equity Vesting in 2021
IN € Components Grant Year Vesting Year
1
Units granted Grant Year Units vested
Chief Executive Officer Stock Options 2021 2024 269.375 2017 to 2020 294.454
Performance Shares 2021 2024 51.162 2018 13.788
Restricted Shares 2021 2024 17.054 2018 9.192
Other SLT Members Stock Options 2021 2024 684.223 2017 to 2020 472.640
Performance Shares 2021 2024 129.954 2018 40.335
Restricted Shares 2021 2024 43.318 2018 26.890
1 Stock Options: for grants prior to 2021, vesting period over four years with a yearly vesting of 25% on 1 January of each year following the grant.
Cliff vesting of three years from 2021 grant year onward
Performance and Restricted Shares: vesting on 1 June of the third year following the year of the grant
Long Term Equity 2020
Long Term Equity Plan – 2020 Grant Equity Vesting in 2020
IN € Components Grant Year Vesting Year
1
Units granted Grant Year Units vested
Chief Executive Officer Stock Options 2020 2021 to 2024 302.827 2017 to 2019 218.747
Performance Shares 2020 2023 48.528 2017 8.719
Restricted Shares 2020 2023 16.176 2017 2.990
Other SLT Members Stock Options 2020 2021 to 2024 867.616 2016 to 2019 319.873
Performance Shares 2020 2023 145.164 2017 26.247
Restricted Shares 2020 2023 48.388 2017 9.001
1 Stock Options: for grants prior to 2021, vesting period over four years with a yearly vesting of 25% on 1 January of each year following the grant.
Cliff vesting of three years from 2021 grant year onward
Performance and Restricted Shares: vesting on 1 June of the third year following the year of the grant
When exercising their vested stock options and their vested shares,
the SLT members must do this in accordance with the SES Dealing
Code (including requiring the prior authorization from the Deputy
Corporate Secretary and/or Chief Financial Officer and provide selling
orders outside of a closed period).
During 2021, Christophe De Hauwer had sold all performance and
restricted shares that vested on 1 June 2021. Evie Roos and Thai Rubin
sold some of the restricted and performance shares that vested on
1 June 2021. Steve Collar, Ruy Pinto, John Baughn and John-Paul
Hemingway kept all their restricted and performance shares that
vested on 1 June 2021. Sandeep Jalan has purchased 15,000 stock
options from 2020 Stock option grant at the price of 5,973 per share.
John Baughn bought additional 3,500 shares during year 2021.
As for the members of the Board, all transactions are reported on the
SES website:
Company > About Us > ESG > Corporate Governance
> Management Disclosures
Benefits package
As for the benefits provided to members of the SLT, they are aligned
with local and market practices and include pensions, health care
plans, death and disability insurances, company cars or car allowances
and other payments.
92 Audit report
96 Consolidated income statement
97 Consolidated statement
of comprehensive income
98 Consolidated statement
of financial position
99 Consolidated statement
of cash flows
100 Consolidated statement
of changes in shareholders’ equity
102 Notes to the consolidated
financial statements
CONSOLIDATED
FINANCIAL
STATEMENTS
4
SES ANNUAL REPORT 202192
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
AUDIT REPORT
To the Shareholders of SES S.A.
REPORT ON THE AUDIT OF THE
CONSOLIDATED FINANCIAL STATEMENTS
OUR OPINION
In our opinion, the accompanying consolidated financial statements
give a true and fair view of the consolidated financial position of
SES S.A. (the “Company”) and its subsidiaries (the “Group”) as at
31 December 2021, and of its consolidated financial performance and
its consolidated cash flows for the year then ended in accordance
with International Financial Reporting Standards (IFRSs) as adopted
by the European Union.
Our opinion is consistent with our additional report to the Audit and
Risk Committee.
What we have audited
The Group’s consolidated financial statements comprise:
• the consolidated statement of financial position as at 31 Decem-
ber 2021;
• the consolidated income statement for the year then ended;
• the consolidated statement of comprehensive income for the year
then ended;
• the consolidated statement of cash flows for the year then ended;
• the consolidated statement of changes in shareholders’ equity for
the year then ended; and
• the notes to the consolidated financial statements, which include
a summary of significant accounting policies.
BASIS FOR OPINION
We conducted our audit in accordance with the EU Regulation
No 537/2014, the Law of 23 July 2016 on the audit profession (Law of
23 July 2016) and with International Standards on Auditing (ISAs)
as adopted for Luxembourg by the “Commission de Surveillance du
Secteur Financier” (CSSF). Our responsibilities under the EU Regula-
tion No 537/2014, the Law of 23 July 2016 and ISAs as adopted for
Luxembourg by the CSSF are further described in the “Responsibilities
of the “Réviseur d’entreprises agréé” for the audit of the consolidated
financial statements” section of our report.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
We are independent of the Group in accordance with the International
Code of Ethics for Professional Accountants, including International
Independence Standards, issued by the International Ethics Standards
Board for Accountants (IESBA Code) as adopted for Luxembourg by
the CSSF together with the ethical requirements that are relevant to
our audit of the consolidated financial statements. We have fulfilled
our other ethical responsibilities under those ethical requirements.
To the best of our knowledge and belief, we declare that we have not
provided non-audit services that are prohibited under Article 5(1) of
the EU Regulation No 537/2014.
The non-audit services that we have provided to the Company and
its controlled undertakings, if applicable, for the year then ended, are
disclosed in Note 5 to the consolidated financial statements.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judg-
ment, were of most significance in our audit of the consolidated financial
statements of the current period. These matters were addressed in
the context of our audit of the consolidated financial statements as
a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
Revenue recognition
The application of revenue recognition accounting standards is
complex and involves a number of key judgements and estimates in
the determination of the appropriate accounting treatment (lease vs.
service arrangements, identification of the performance obligations
and timing of revenue recognition, barter transactions, principle
versus agent considerations, etc.).
We focused on this area due to the inherent complexity and judge-
ment in applying the revenue recognition accounting standards and
to the significant focus on the revenue amount (1,782 million EUR for
the year ended 31 December 2021) by the users of the consolidated
financial statements (see >> Note 3).
How our audit addressed the key audit matter
•
We obtained an understanding of the main revenue streams and
evaluated the accounting policy for revenue recognition thereof;
PricewaterhouseCoopers, Société coopérative, 2 rue Gerhard Mercator, B.P. 1443, L-1014 Luxembourg, T : +352 494848 1, F : +352 494848 2900, www.pwc.lu
Cabinet de révision agréé. Expert-comptable (autorisation gouvernementale n°10028256) R.C.S. Luxembourg B 65 477 - TVA LU25482518
SES ANNUAL REPORT 202193
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
•
We held discussions with Management on IFRS accounting analysis
of any non-standard revenue contracts, performed testing of sig-
nificant new revenue contracts and verified that the underlying rev-
enue transactions were accounted in accordance with the substance
of the commercial agreement and the relevant IFRS standards;
•
We performed substantive analytical procedures at year-end on
revenue and revenue-related accounting in order to identify any
unusual variances;
•
We tested any unusual and/or significant manual journal entries
made to the revenue accounts, both at local and group level;
•
We evaluated the deferred revenue schedules and their reconciliation
with the accounting;
• We performed substantive testing on a sample of revenue trans-
actions;
•
We considered the disclosures in >> Note 3 the consolidated
financial statements and assessed their appropriateness.
Impairment of goodwill and orbital slot license rights
(indefinite life)
Management revised the grouping of the cash-generating units of
the Group, effectively disaggregating the GEO CGU into Europe, North
America and International CGUs. The MX1 operations, formerly under
the MX1 CGU, were simultaneously integrated into the GEO Europe
CGU. The MEO CGU remains unchanged.
Management performed the annual impairment test based on the
value in use determined on the basis of a discounted cash flows model
for each of the cash-generating units.
The Group has goodwill of 1,520 million EUR and orbital rights with
indefinite useful lives of 2,065 million EUR. An impairment expense
of 673 million EUR was recognised for the year ended 31 Decem-
ber 2021 in relation to the goodwill at the level of the GEO North
America CGU (see >> Note 14).
We focused on this area due to the high level of judgement in relation
with the assumptions used in the calculation of the recoverable
amounts (forecasted cash flows, long-term growth rates, discount
rates, etc.).
How our audit addressed the key audit matter
•
We tested the design and implementation of relevant internal
controls;
• We evaluated Management’s determination of the cash generating
units as well as the method and model used for the determination
of the value in use, considering the requirements of IAS 36;
• We involved valuation specialists and independently recalculated
the weighted average cost of capital based on the use of market
data and verified the long-term growth rate to market data;
•
We agreed the forecasted cash flows used for the calculation of the
value in use to the 2022 Business Plan as approved by the Board
of Directors;
•
We evaluated the forecasted revenue and costs assumptions,
considering our expectations in terms of significant developments
during the forecast period (significant new contracts or loss
thereof) and corroborated these with market data in respect of
demand for satellite capacity and pricing;
•
We evaluated the capital expenditure assumptions, considering
our expectations in terms of significant developments during the
forecast period (capital expenditure programs, replacement of
satellites) and the expected capital expenditure level in terminal
period in order to maintain the current assets base;
• We performed sensitivity analysis of the models to changes in the
key assumptions;
•
We considered the appropriateness of the disclosures in >> Note 14
to the consolidated financial statements.
Impairment of satellites
The Group has a space segment assets balance, representing primarily
satellites, of 3,377 million EUR as at 31 December 2021. An impairment
expense of 73 million EUR and a reversal of impairment expense pre-
viously recorded of 22 million EUR were recognised for the year ended
31 December 2021 in relation to several satellites, due to the change
in their forecasted future revenue (see >> Note 12).
The valuation of the satellites might be impacted by events that may
or may not be under Management’s control (e.g. solar array issues)
or by a decrease in revenue due to unfavorable market developments.
Moreover, there is a risk of impairment of the satellites due to ob -
solescence in the context of rapid evolution of technology.
How our audit addressed the key audit matter
•
We tested the design and implementation of relevant internal
controls;
• We discussed with Management, and in particular the engineering
team about any satellite health issues and evaluated their impact
on the satellites’ capability to generate future cash inflows, and
implicitly on the recoverable amount of the satellites;
•
We evaluated the forecasted revenue and cost assumptions,
considering our expectations in terms of significant developments
during the forecast period (significant new contracts or loss
thereof) and corroborated these with market data in respect of
demand for satellite capacity and pricing;
• We involved valuation specialists and validated the method used
to derive the value in use of satellites presenting a risk of impair-
ment. We independently recalculated the weighted average cost
of capital based on the use of market data;
• We performed sensitivity analysis of the models to changes in the
key assumptions;
•
We considered the disclosures in >> Note 12 to the consolidated
financial statements.
SES ANNUAL REPORT 202194
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Taxation
The Group operates across a large number of jurisdictions and is sub-
ject to various tax legislations and periodic reviews by local tax
authorities of a range of tax matters, including transfer pricing, during
the normal course of business. Moreover, the current tax structure of
the Group is evolving to reflect recent developments in international
taxation.
We focused on two specific tax matters relating to the provisions for
tax risks, and the recognition and recoverability of the deferred tax
assets, due to the high level of judgment in the determination of the
current and deferred income tax balances and the determination of
the level of the tax provisions.
How our audit addressed the key audit matter
• We tested the design and implementation of controls in respect of
tax accounting, including the determination of the provisions for
tax risks;
•
We involved tax specialists in Luxembourg, the Netherlands and
the USA, representing the main tax jurisdictions where the Group
has an exposure, to gain an understanding of the current tax risks
and evaluated the current and deferred tax income and expense
and related balances;
•
We held discussions with the Group Tax Management to under-
stand and evaluate positions taken on uncertain tax risks and
assessed the Group tax provision;
• We discussed with Management the status of the open tax audits
and evaluated their impact on the consolidated financial state-
ments;
• We analysed the recognition and recoverability of the deferred tax
assets and determined that it is supported by forecast future tax
profits;
• We considered the appropriateness of the disclosures in >> Note 7
and >> Note 8 to the consolidated financial statements.
OTHER INFORMATION
The Board of Directors is responsible for the other information. The
other information comprises the information stated in the consolidated
management report and the Corporate Governance Statement but
does not include the consolidated financial statements and our audit
report thereon.
Our opinion on the consolidated financial statements does not cover
the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the consolidated financial state-
ments, our responsibility is to read the other information identified
above and, in doing so, consider whether the other information is
materially inconsistent with the consolidated financial statements
or our knowledge obtained in the audit, or otherwise appears to be
materially misstated. If, based on the work we have performed, we
conclude that there is a material misstatement of this other infor-
mation, we are required to report that fact. We have nothing to report
in this regard.
RESPONSIBILITIES OF THE BOARD OF DIRECTORS
AND THOSE CHARGED WITH GOVERNANCE FOR
THE CONSOLIDATED FINANCIAL STATEMENTS
The Board of Directors is responsible for the preparation and fair pres-
entation of the consolidated financial statements in accordance with
IFRSs as adopted by the European Union, and for such internal con-
trol as the Board of Directors determines is necessary to enable the
preparation of consolidated financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the Board of
Directors is responsible for assessing the Group’s ability to continue
as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
Board of Directors either intends to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the
Group’s financial reporting process.
The Board of Directors is responsible for presenting and marking up
the consolidated financial statements in compliance with the require-
ments set out in the Delegated Regulation 2019/815 on European
Single Electronic Format (“ESEF Regulation”).
RESPONSIBILITIES OF THE “RÉVISEUR D’ENTRE-
PRISES AGRÉÉ” FOR THE AUDIT OF THE CONSOLI-
DATED FINANCIAL STATEMENTS
The objectives of our audit are to obtain reasonable assurance about
whether the consolidated financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue
an audit report that includes our opinion. Reasonable assurance is
a high level of assurance, but is not a guarantee that an audit con-
ducted in accordance with the EU Regulation No 537/2014, the Law
of 23 July 2016 and with ISAs as adopted for Luxembourg by the CSSF
will always detect a material misstatement when it exists. Misstate-
ments can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected
to influence the economic decisions of users taken on the basis of
these consolidated financial statements.
As part of an audit in accordance with the EU Regulation No 537/2014,
the Law of 23 July 2016 and with ISAs as adopted for Luxembourg by
the CSSF, we exercise professional judgment and maintain profes-
sional scepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the con-
solidated financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis
SES ANNUAL REPORT 202195
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions, mis-
representations, or the override of internal control;
• obtain an understanding of internal control relevant to the audit
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Group’s internal control;
• evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures
made by the Board of Directors;
• conclude on the appropriateness of the Board of Directors’ use of
the going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s
ability to continue as a going concern. If we conclude that a mate-
rial uncertainty exists, we are required to draw attention in our audit
report to the related disclosures in the consolidated financial state-
ments or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on the audit evidence obtained up to
the date of our audit report. However, future events or conditions
may cause the Group to cease to continue as a going concern;
•
evaluate the overall presentation, structure and content of the
consolidated financial statements, including the disclosures, and
whether the consolidated financial statements represent the
underlying transactions and events in a manner that achieves fair
presentation;
•
obtain sufficient appropriate audit evidence regarding the financial
information of the entities and business activities within the Group
to express an opinion on the consolidated financial statements. We
are responsible for the direction, supervision and performance of
the Group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that
we have complied with relevant ethical requirements regarding inde-
pendence, and communicate to them all relationships and other mat-
ters that may reasonably be thought to bear on our independence,
and where applicable, actions taken to eliminate threats or safeguards
applied.
From the matters communicated with those charged with governance,
we determine those matters that were of most significance in the audit
of the consolidated financial statements of the current period and are
therefore the key audit matters. We describe these matters in our
audit report unless law or regulation precludes public disclosure about
the matter.
We assess whether the consolidated financial statements have been
prepared, in all material respects, in compliance with the requirements
laid down in the ESEF Regulation.
REPORT ON OTHER LEGAL AND
REGULATORY REQUIREMENTS
The consolidated management report is consistent with the con-
solidated financial statements and has been prepared in accordance
with applicable legal requirements.
The Corporate Governance Statement is included in the consolidated
management report. The information required by Article 68ter Para-
graph (1) Letters c) and d) of the Law of 19 December 2002 on the
commercial and companies register and on the accounting records
and annual accounts of undertakings, as amended, is consistent with
the consolidated financial statements and has been prepared in
accordance with applicable legal requirements.
We have been appointed as “Réviseur d’Entreprises Agréé” by the
General Meeting of the Shareholders on 1 April 2021 and the duration
of our uninterrupted engagement, including previous renewals and
reappointments, is 9 years.
We have checked the compliance of the consolidated financial state-
ments of the Group as at 31 December 2021 with relevant statutory
requirements set out in the ESEF Regulation that are applicable to
consolidated financial statements.
For the Group it relates to the requirement that:
•
the consolidated financial statements are prepared in a valid
XHTML format;
•
the XBRL markup of the consolidated financial statements uses
the core taxonomy and the common rules on markups specified in
the ESEF Regulation.
In our opinion, the consolidated financial statements of the Group as
at 31 December 2021, identified as “SES Annual report -2021-12-31-en”,
have been prepared, in all material respects, in compliance with the
requirements laid down in the ESEF Regulation.
PricewaterhouseCoopers, Société coopérative
Represented by
François Mousel Luxembourg, 2 March 2022
SES ANNUAL REPORT 202196
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Consolidated Income Statement
€ MILLION 2021 2020
Revenue
>> Note 3 1,782 1,876
C-band repurposing income
>> Note 33 901 10
Cost of sales
>> Note 4 (319 ) (291 )
Staff costs
>> Note 4 (304 ) (330 )
Other operating expenses
>> Note 4 (198 ) (186 )
Operating expenses
>> Note 4 (821 ) (807 )
EBITDA
>> Note 35 1,862 1,079
Depreciation expense
>> Note 12 (575 ) (625 )
Property, plant and equipment impairment
>> Note 12 (51 ) (183 )
Amortisation expense
>> Note 14 (95 ) (95 )
Intangible assets impairment
>> Note 14 (673 ) (94 )
Operating profit
>> Note 3 468 82
Net financing costs
>> Note 6 (71 ) (184 )
Profit/(loss) before tax 397 (102 )
Consolidated Income Statement
€ MILLION 2021 2020
Income tax benefit
>> Note 7 49 7
Profit/(loss) after tax 446 (95 )
Profit/(loss) for the year 446 (95 )
Attributable to:
Owners of the parent 453 (86 )
Non-controlling interests (7 ) (9 )
Basic and diluted earnings/(loss) per share (in euro)
Class A shares
>> Note 10 0.92 (0.30 )
Class B shares
>> Note 10 0.37 (0.12 )
Adjusted EBITDA (Note 35) 1,091 1,152
C-band repurposing income
>> Note 33 901 10
C-band operating expenses
>> Note 33 (122 ) (43 )
Restructuring expenses
>> Note 24 (8 ) (40 )
EBITDA 1,862 1,079
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED
INCOME STATEMENT
For the year ended 31 December 2021
SES ANNUAL REPORT 202197
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Consolidated Statement of Comprehensive Income
€ MILLION 2021 2020
Profit/(loss) for the year 446 (95 )
Other comprehensive income
Items that will not be reclassified to profit or loss
Remeasurements of post-employment benefit obligation 3 (3 )
Income tax effect (1 ) 1
Remeasurements of post-employment benefit obligation, net of tax 2 (2 )
Income tax relating to treasury shares impairment expense or reversal 1 6
Total items that will not be reclassified to profit or loss 3 4
Items that may be reclassified subsequently to profit or loss
Impact of currency translation
>> Note 9 471 (624 )
Income tax effect
>> Note 9 (36 ) 35
Total impact of currency translation, net of tax 435 (589 )
Consolidated Statement of Comprehensive Income
€ MILLION 2021 2020
Net investment hedge
>> Note 18 (102 ) 113
Income tax effect
>> Note 18 26 (29 )
Total net investment hedge, net of tax (76 ) 84
Total items that may be reclassified subsequently to profit or loss 359 (505 )
Total other comprehensive income/(loss) for the year, net of tax 362 (501 )
Total comprehensive income/(loss) for the year, net of tax 808 (596 )
Attributable to:
Owners of the parent 815 (585 )
Non-controlling interests (7 ) (11 )
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME
For the year ended 31 December 2021
SES ANNUAL REPORT 202198
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Consolidated Statement of Financial Position
€ MILLION 2021 2020
Non-current assets
Property, plant and equipment
>> Note 12 3,773 4,170
Assets in the course of construction
>> Note 13 1,788 1,651
Total property, plant and equipment 5,561 5,821
Intangible assets
>> Note 14 3,790 4,192
Other financial assets 26 14
Trade and other receivables
>> Note 16 245 268
Deferred customer contract costs 9 9
Deferred tax assets
>> Note 8 568 313
Total non-current assets 10,199 10,617
Current assets
Inventories 23 27
Trade and other receivables
>> Note 16 1,746 488
Deferred customer contract costs 3 10
Prepayments 48 72
Income tax receivable 13 11
Cash and cash equivalents
>> Note 19 1,049 1,162
Total current assets 2,882 1,770
Total assets 13,081 12,387
Consolidated Statement of Financial Position
€ MILLION 2021 2020
Equity
Attributable to the owners of the parent
>> Note 20 5,670 5,366
Non-controlling interests
>> Note 21 63 72
Total equity 5,733 5,438
Non-current liabilities
Borrowings
>> Note 23 3,524 3,317
Provisions
>> Note 24 6 12
Deferred income
>> Note 15 314 296
Deferred tax liabilities
>> Note 8 399 333
Other long-term liabilities
>> Note 26 83 127
Lease liabilities
>> Note 29 22 25
Fixed assets suppliers
>> Note 27 472 1,310
Total non-current liabilities 4,820 5,420
Current liabilities
Borrowings
>> Note 23 57 613
Provisions
>> Note 24 56 60
Deferred income
>> Note 15 404 454
Trade and other payables
>> Note 25 292 300
Lease liabilities
>> Note 29 11 12
Fixed assets suppliers
>> Note 27 1,554 67
Income tax liabilities 154 23
Total current liabilities 2,528 1,529
Total liabilities 7,348 6,949
Total equity and liabilities 13,081 12,387
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED STATEMENT
OF FINANCIAL POSITION
As at 31 December 2021
SES ANNUAL REPORT 202199
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Consolidated Statement of Cash Flows
€ MILLION 2021 2020
Profit/(loss) before tax 397 (102 )
Taxes paid during the year (31 ) (31 )
Interest expense on borrowings
>> Note 6 96 123
Depreciation, amortisation and impairment
>> Notes 12, 14 1,394 997
Amortisation of client upfront payments (65 ) (72 )
Other non-cash items in the consolidated income statement (41 ) 76
Consolidated operating profit adjusted for non-cash items
and tax payments and before working capital changes 1,750 991
Changes in working capital
(Increase)/decrease in inventories 4 (6 )
(Increase)/decrease in trade and other receivables (492 ) 17
Decrease in prepayments and deferred charges 15 17
Decrease in trade and other payables (25 ) (73 )
Increase in upfront payments and deferred income 42 103
Changes in working capital (456 ) 58
Net cash generated by operating activities 1,294 1,049
Cash flow from investing activities
Payments for purchases of intangible assets (37 ) (39 )
Payments for purchases of tangible assets (243 ) (171 )
Other investing activities (3 ) (7 )
Net cash absorbed by investing activities
(283 ) (217 )
Consolidated Statement of Cash Flows
€ MILLION 2021 2020
Cash flow from financing activities
Proceeds from borrowings
>> Note 30 159 395
Repayment of borrowings
>> Note 30 (614 ) (785 )
Proceeds from Perpetual bond, net of transaction costs
>> Note 20 617 –
Redemption of Perpetual bond, net of transaction costs
>> Note 20 (768 ) –
Coupon paid on perpetual bond
>> Note 20 (85 ) (66 )
Dividends paid on ordinary shares
1
>> Note 11 (181 ) (182 )
Dividends paid to non-controlling interest (2 ) –
Interest paid on borrowings (121 ) (152 )
Payments for acquisition of treasury shares (119 ) (10 )
Proceeds from treasury shares sold and exercise of stock options 1 9
Lease payments
>> Note 29 (14 ) (15 )
Payment in respect of changes in ownership interest in subsidiaries - (7 )
Net cash absorbed by financing activities (1,127 ) (813 )
Net foreign exchange movements 3 (12 )
Net increase in cash (113 ) 7
Cash and cash equivalents at beginning of the year
>> Note 19 1,162 1,155
Cash and cash equivalents at end of the year
>> Note 19 1,049 1,162
1 Dividends are presented net of dividends received on treasury shares of € 2 million (2020: € 2 million).
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED STATEMENT
OF CASH FLOWS
For the year ended 31 December 2021
SES ANNUAL REPORT 2021100
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Consolidated Statement of Changes in Shareholders’ Equity
Attributable to owners of the parent
€ MILLION
Issued
capital
Share
premium
Treasury
shares
Perpetual
bond
Other
reserves
2
Retained
earnings
Foreign
currency
translation
reserve Total
Non-
controlling
interest Total equity
At 1 January 2021 719 1,636 (76 ) 1,300 2,583 (86 ) (710 ) 5,366 72 5,438
Result for the year – – – – – 453 – 453 (7 ) 446
Other comprehensive income – – – – 3 – 359 362 – 362
Total comprehensive income for the year – – – – 3 453 359 815 (7 ) 808
Allocation of 2020 result – – – – (86 ) 86 – – – –
Issue of new Perpetual bond, net of transaction costs – – – 625 (8 ) – – 617 – 617
Redemption of Perpetual bond, net of transaction costs – – – (750 ) (18 ) – – (768 ) – (768 )
Coupon on perpetual bond (>> Note 20) – – – – (85 ) – – (85 ) – (85 )
Tax on perpetual bond coupon (>> Note 20) – – – – 20 – – 20 – 20
Dividends provided for or paid
1
Acquisition of treasury shares – – (119 ) – – – – (119 ) – (119 )
Share-based compensation expense (>> Note 22) – – – – 5 – – 5 – 5
Exercise of share-based compensation – – 6 – (6 ) – – – – –
At 31 December 2021 719 1,636 (189 ) 1,175 2,227 453 (351 ) 5,670 63 5,733
1 Dividends are presented net of dividends received on treasury shares of € 2 million.
2 The non-distributable items included in other reserves are described in >> Note 20.
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED STATEMENT OF
CHANGES IN SHAREHOLDERS’ EQUITY
For the year ended 31 December 2021
SES ANNUAL REPORT 2021101
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Consolidated Statement of Changes in Shareholder’ Equity
Attributable to owners of the parent
€ MILLION
Issued
capital
Share
premium
Treasury
shares
Perpetual
bond
Other
reserves
2
Retained
earnings
Foreign
currency
translation
reserve Total
Non-
controlling
interest Total equity
At 1 January 2020 719 1,636 (90 ) 1,300 2,519 296 (207 ) 6,173 83 6,256
Result for the year – – – – – (86 ) – (86 ) (9 ) (95 )
Other comprehensive income – – – – 4 – (503 ) (499 ) (2 ) (501 )
Total comprehensive income for the year
Allocation of 2019 result – – – – 296 (296 ) – – – –
Coupon on perpetual bond (>> Note 20) – – – – (66 ) – – (66 ) – (66 )
Tax on perpetual bond coupon (>> Note 20) – – – – 18 – – 18 – 18
Dividends provided for or paid
1
Acquisition of treasury shares – – (10 ) – – – – (10 ) – (10 )
Share-based compensation expense – – – – 10 – – 10 – 10
Exercise of share-based compensation – – 7 – (14 ) – – (7 ) – (7 )
Sale of treasury shares – – 17 – – – – 17 – 17
Other movements – – – – (2 ) – – (2 ) – (2 )
At 31 December 2020 719 1,636 (76 ) 1,300 2,583 (86 ) (710 ) 5,366 72 5,438
1 Dividends are presented net of dividends received on treasury shares of € 2 million.
2 The non-distributable items included in other reserves are described in >> Note 20.
The notes are an integral part of the consolidated financial statements.
CONSOLIDATED STATEMENT OF
CHANGES IN SHAREHOLDERS’ EQUITY
For the year ended 31 December 2020
SES ANNUAL REPORT 2021102
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
31 December 2021
The consolidated financial statements have been prepared on a
historical cost basis, except where fair value is required by IFRS.
The consolidated financial statements are presented in euro (€).
Unless otherwise stated, all amounts are rounded to the nearest
million, except share and earnings per share data and audit and non-
audit fee disclosures.
CHANGES IN ACCOUNTING POLICIES
The accounting policies adopted are consistent with those of the
previous financial year, except for the following new and amended
IFRS, effective from 1 January 2021 and adopted by the Group. Any
new IFRS amendments, effective from 1 January 2021 and not
mentioned below are not applicable to the Group.
1) Amendments to IFRS 4 “Insurance contracts – deferral
of IFRS 9”
The amendments extend the expiry date of the temporary
exemption from applying IFRS 9 from 1 January 2021 to 1 Janu-
ary 2023 to align the effective dates of IFRS 9 Financial Instru-
ments with IFRS 17 Insurance Contracts. The amendments were
endorsed by the EU and are effective for annual periods begin-
ning on or after 1 January 2021. The adoption of these amend-
ments did not have any impact on the Group’s consolidated
financial statements.
2) Amendments to IFRS 7, IFRS 4 and IFRS 16 Interest
Rate Benchmark Reform – Phase 2
The amendments address issues that arise from the implemen-
tation of the reforms, including the replacement of one bench-
mark with an alternative one. The Phase 2 amendments provide
additional temporary reliefs from applying specific IAS 39 and
IFRS 9 hedge accounting requirements to hedging relationships
directly affected by IBOR reform. The amendments were
endorsed by the EU and are effective for annual periods begin-
ning on or after 1 January 2021. The adoption of these amend-
ments did not have any impact on the Group’s consolidated
financial statements >> Note 23.
3) Amendment to IFRS 16, “Leases” – COVID-19 related
rent concessions
As a result of the coronavirus (COVID-19) pandemic, rent
concessions have been granted to lessees. Such concessions
might take a variety of forms, including payment holidays and
deferral of lease payments. On 31 March 2021, the IASB published
an additional amendment to extend the date of the practical
expedient from 30 June 2021 to 30 June 2022. Lessees can elect
to account for such rent concessions in the same way as they
would if they were not lease modifications. In many cases, this
will result in accounting for the concession as variable lease
payments in the period(s) in which the event or condition that
triggers the reduced payment occurs. The amendment is
effective for annual reporting periods beginning on or after
1 June 2021. The adoption of this amendment did not have any
impact on the Group’s consolidated financial statements.
BASIS OF CONSOLIDATION
The consolidated financial statements comprise the financial state-
ments of the Company and its controlled subsidiaries, after the
elimination of all inter-company transactions. Subsidiaries are fully
NOTE 1 – CORPORATE INFORMATION
as a limited liability company (Société Anonyme) under Luxembourg
Law. References to ‘the Group’ in the following notes are to the Com-
pany and its subsidiaries. SES trades under ‘SESG’ on the Luxembourg
Stock Exchange and Euronext, Paris. The registered office of the
Company is established at the Château de Betzdorf, L - 6815 Betzdor f,
The consolidated financial statements of SES as at, and for the yea r
with a resolution of the Board of Directors on 23 February 2022. Under
Luxembourg Law, the consolidated financial statements are approved
by the shareholders at their Annual General Meeting.
NOTE 2 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
BASIS OF PREPARATION
The consolidated financial statements have been prepared in com-
pliance with International Financial Reporting Standards as issued by
the International Accounting Standards Board (‘IASB’) and endorsed
by the European Union (‘IFRS’), as at 31 December 2021.
SES ANNUAL REPORT 2021103
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
consolidated from the date the Company obtains control until such
time as control ceases. The financial statements of subsidiaries are
generally prepared for the same reporting period as the Company,
using consistent accounting policies. If required, adjustments are
made to align any dissimilar accounting policies that may exist. For
details regarding the subsidiaries included in the consolidated
financial statements >> Note 36.
Total comprehensive income or loss incurred by a subsidiary is attrib-
uted to the non-controlling interest even if that results in a deficit bal-
ance. Should a change in the ownership interest in a subsidiary occur,
without a loss of control, this is accounted for as an equity transaction.
Should the Group cease to have control, any retained interest in the
entity is re-measured to its fair value at the date when control is lost,
with the change in carrying amount recognised in profit or loss. The
fair value is the initial carrying amount for the purpose of subse-
quently accounting for the retained interest as an associate, joint
venture or financial asset. In addition, any amounts previously recog-
nised in other comprehensive income in respect of that entity are
accounted for as if the Group had directly disposed of the related
assets or liabilities. This may mean that amounts previously recog-
nised in other comprehensive income are reclassified to profit or loss.
Non-controlling interests in the results and equity of subsidiaries are
presented separately in the consolidated income statement, state-
ment of comprehensive income, statement of changes in equity and
statement of financial position respectively.
INVESTMENTS IN ASSOCIATES
An associate is an entity in which the Group has significant influence
but not control or joint control. The Group accounts for investments
in associates using the equity method of accounting.
Under the equity method, the investment in the associate is carried
in the statement of financial position at cost plus post-acquisition
changes in the Group’s share of the profit or loss of the associate.
Goodwill relating to an associate is included in the carrying amount
of the investment and is not amortised.
The Group determines at each reporting date whether there is any
objective evidence that the investment in the associate is impaired.
If this is the case, the Group calculates the amount of impairment as
the difference between the recoverable amount of the associate and
its carrying value and recognises the amount within ‘Share of associ-
ates’ result’ in the consolidated income statement.
The Group’s share of post-acquisition profit or loss is recognised in
the consolidated income statement, and its share of post-acquisition
movements in other comprehensive income is recognised in other
comprehensive income with a corresponding adjustment to the
carrying amount of the investment. When the Group’s share of losses
in an associate equals, or exceeds, its interest in the associate, includ-
ing any other unsecured receivables, the Group does not recognise
further losses unless it has incurred legal or constructive obligations
or made payments on behalf of the associate. In general, the financial
statements of associates are prepared for the same reporting year as
the parent company, using consistent accounting policies. If required,
adjustments are made to align any dissimilar accounting policies that
may exist. For details regarding the associates included in the
consolidated financial statements >> Note 36.
Profits and losses resulting from upstream and downstream transac-
tions between the Group and its associates are recognised in the
Group’s consolidated financial statements only to the extent of
unrelated investors’ interests in the associates. Dilution gains and
losses arising in investments in associates are recognised in the
consolidated income statement.
The Group ceases to use the equity method of accounting on the date
from which it no longer has significant influence over the associate, or
when the interest becomes classified as an asset held for sale.
SIGNIFICANT ACCOUNTING JUDGMENTS
AND ESTIMATES
1) Judgments
In the process of applying the Group’s accounting policies, man-
agement has made the following judgments, apart from those
involving estimations, which have the most significant effect on
the amounts recognised in the financial statements:
(i) Treatment of orbital slot licence rights
The Group’s operating companies have obtained rights to
operate satellites at certain orbital locations and using certain
frequency bands. These licences are obtained through applica-
tions to the relevant national and international regulatory author-
ities and are generally made available for a defined period. Where
the Group has obtained such rights through the acquisition of
subsidiaries, the rights have been identified as an asset acquired
and recorded at the fair value attributed to the asset at the time
of the acquisition as a result of purchase accounting procedure.
In the cases when, on the expiry of such rights, management
believes it will be able to successfully re-apply for their usage at
insignificant incremental cost, then such rights are deemed to
have an indefinite life. Hence these assets are not amortised, but
rather are subject to regular impairment reviews to confirm that
the carrying value in the Group’s financial statements is still
appropriate. More details are given in >> Note 14.
(ii) Taxation
The Group operates in numerous tax jurisdictions and manage-
ment is required to assess tax issues and exposures across its
entire operations and to accrue for potential liabilities based on
its interpretation of country-specific tax law and best estimates.
In conducting this review management assesses the magnitude
of the issue and the likelihood, based on experience and special-
ist advice, as to whether it will result in a liability for the Group.
SES ANNUAL REPORT 2021104
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
If this is deemed to be the case, then a provision is recognised
for the potential taxation charges. More details are given in
>> Notes 7 and >> Note 24.
One significant area of management judgement is around trans-
fer pricing. Whilst the Group employs dedicated members of staff
to establish and maintain appropriate transfer pricing structures
and documentation, judgement still needs to be applied and
hence potential tax exposures can be identified in the different
jurisdictions where the Group operates. The Group, as part of its
overall assessment of liabilities for taxation, reviews in detail the
transfer pricing structures in place and records provisions where
this seems appropriate on a case-by-case basis.
(iii) Consolidation of entities in which the Group holds
50% or less
• Al Maisan Satellite Communication LLC
(trading as ‘Yahlive’)
Management has concluded that the Group controls Al Mai-
san Satellite Communication LLC (‘Yahlive’), even though it
holds a 35% economic interest in this subsidiary since it has
the majority of the voting rights on the Board of Directors
of Yahlive and there are no voting rights at the shareholder
level which could affect SES’ control.
SES has effective control over the relevant activities of Yahlive,
such as budget approval, appointment and removal of the
Chief Executive Officer and senior management team members
as well as the effective control over the appointment or
removal of the majority of the members of the Board of
Directors. The entity is therefore consolidated with a 65%
non-controlling interest >> Note 21.
• LuxGovSat S.A.
SES and the Luxembourg government jointly incorporated
the legal entity LuxGovSat S.A. (‘LuxGovSat’) as a limited
liability company (Société Anonyme) under Luxembourg
law, subscribing equally in the equity of the new company.
Management has concluded that the Group controls Lux-
GovSat since SES has effective control over the relevant
activities of the entity. It is therefore consolidated with a
50% non-controlling interest >> Note 21.
(iv) SES Government Solutions, Inc.
SES Government Solutions, Inc., USA (‘SES GS’) is subject to
specific governance rules and is managed through a Proxy
Agreement agreed with the Defense Security Service (‘DSS’)
department of the US Department of Defense (‘DOD’). The DSS
is a governmental authority responsible for the protection of
information deemed classified or sensitive with respect to the
national security of the United States of America. A proxy agree-
ment is an instrument intended to mitigate the risk of foreign
ownership, control or influence when a foreign person acquires
or merges with a US entity that has a facility security clearance.
A proxy agreement conveys a foreign owner’s voting rights to
proxy holders, comprising the proxy board. Proxy holders are
cleared US citizens approved by the DSS.
The DSS required that SES GS enter into a proxy agreement
because it is indirectly owned by SES and SES GS has con-
tracts with the DOD which contain classified information. The
Proxy Agreement enables SES GS to participate in such con-
tracts with the US Government despite being owned by a
non-US corporation.
As a result of the Proxy Agreement, certain limitations are placed
on the information which may be shared, and the interaction
which may occur, between SES GS and other Group companies.
The Proxy Holders, besides acting as directors of SES GS, are
entitled to vote in the context of a trust relationship with SES on
which basis their activity is performed in the interest of SES’s
shareholders and of US national security.
SES’s assessment of the effective control over the relevant
activities of SES GS encompassed the activities of operating and
capital decision making, the appointment and remuneration of
key management, and the exposure to the variability of financial
returns based on the financial performance of SES GS.
Based on this assessment, SES concluded that, from an IFRS 10
perspective, SES has, and is able to exercise, power over the
relevant activities of SES GS and has an exposure to variable
returns from its involvement in SES GS – and therefore controls
the entity.
2) Estimation uncertainty
The key assumptions concerning the future and other key
sources of estimation uncertainty at the reporting date that have
a significant risk of causing a material adjustment to the carry-
ing amounts of assets and liabilities within the next financial
year(s), are described below. The Group based its assumptions
and estimates on parameters available when the consolidated
financial statements were prepared. Existing circumstances and
assumptions about future developments, however, may change
due to market changes or circumstances arising beyond the
control of the Group. Such changes are reflected in revisions to
the assumptions when they occur.
(i) Impairment testing for goodwill and other
indefinite-life intangible assets
The Group determines whether goodwill and other indefinite-life
intangible assets are impaired at least on an annual basis. This
requires an estimation of the value in use of the cash generat-
ing units (‘CGUs’) to which the goodwill and other indefinite-life
intangible assets are allocated. Establishing the value in use
requires the Group to make an estimate of the expected future
pre-tax cash flows from the CGU and to choose a suitable
pre-tax discount rate and terminal growth rate to calculate the
present value of those cash flows. More details are given in
>> Note 14.
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(ii) Impairment testing for space segment assets
The Group assesses at each reporting date whether there is
any indicator that an asset may be impaired. If any such indi-
cation exists, the Group determines an estimate of the recov-
erable amount, as the higher of: (1) the fair value less cost of
disposal and, (2) its value in use, to determine whether the
recoverable amount exceeds the carrying amount included in
the consolidated financial statements. For the Group’s satellites,
the estimation of the value in use requires estimations of the
future commercial revenues to be generated by each satellite,
particularly related to new markets or services, and also the
impact of past in-orbit anomalies and their potential impact on
the satellite’s ability to provide its expected commercial service
>> Note 12.
(iii) Recoverability of deferred tax assets
The Group recognises deferred tax assets primarily in connec-
tion with the carry-forward of unused tax losses and tax cred-
its. The Group reviews the tax position in the different juris-
dictions in which it operates to assess the need to recognise
such assets based mainly on projections of taxable profits to
be generated in each of those jurisdictions. The carrying
amount of each deferred tax asset is reviewed at each report-
ing date and reduced to the extent that current projections
indicate that it is no longer probable that sufficient taxable
profits will be available to enable all, or part, of the asset to be
recovered.
(iv) Expected credit losses on trade receivables and
unbilled accrued revenue
The Group estimates expected credit losses on trade receivables
and unbilled accrued revenues using a provision matrix based
on loss expectancy rates and forward-looking information. The
Group records additional losses if circumstances or forward-look-
ing information cause the Group to believe that an additional
collectability risk exists which is not reflected in the loss expec-
tancy rates >> Note 16.
BUSINESS COMBINATIONS
Business combinations are accounted for using the acquisition
method. The consideration transferred for the acquisition of the
subsidiary is measured as the aggregate of the:
• fair value of the assets transferred;
• liabilities incurred to the former owners of the acquired business;
• equity interests issued by the Group;
• fair value of any asset or liability resulting from a contingent con-
sideration agreement; and
• fair value of any pre-existing equity interest in the subsidiary.
For each business combination, SES measures the non-controlling
interest in the acquiree either at fair value or at the proportionate
share of the acquiree’s identifiable net assets. Acquisition costs
incurred are expensed and included in other operating expenses.
When the Group acquires a business, it assesses the financial assets
acquired and liabilities assumed for appropriate classification and
designation in accordance with the contractual terms, economic
circumstances and pertinent conditions as at the acquisition date.
Assets acquired, and liabilities assumed, are recognised at fair value.
The excess of the:
• consideration transferred;
• amount of any non-controlling interest in the acquired entity; and
•
acquisition-date fair value of any previous equity interest in the
acquired entity;
over the fair value of the net identifiable assets acquired is recorded
as goodwill. If those amounts are less than the fair value of the net
identifiable assets of the business acquired, the difference is recog-
nised directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the
amounts payable in the future are discounted to their present value
as at the date of exchange. If the business combination is achieved
in stages, the acquisition date carrying value of the Group’s previously
held equity interest in the acquiree is remeasured to fair value at the
acquisition date through profit or loss. Any contingent consideration
to be transferred by SES will be recognised at fair value at the acqui-
sition date. Subsequent changes to the fair value of the contingent
consideration which is deemed to be an asset, or a liability, will be
recognised in profit or loss.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment is initially recorded at historical cost,
representing either the acquisition or manufacturing cost. Satellite
cost includes the launcher and launch insurance, less depreciation
and impairment losses.
The financial impact of changes resulting from a revision of manage-
ment’s estimate of the cost of property, plant and equipment is
recognised in the consolidated income statement in the period
concerned.
Right-of-use assets are measured at cost comprising the following:
• the amount of the initial measurement of lease liability;
• any lease payments made at or before the commencement date of
the lease, less any lease incentives received;
• any initial direct costs; and
• restoration costs.
Payments associated with short-term leases and leases of low-value
assets are recognised on a straight-line basis as an expense in profit
or loss. Short-term leases are leases with a term of 12 months or less.
Low-value assets comprise IT-equipment and small items of office
furniture. Costs for the repair and maintenance of these assets are
recorded as an expense.
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INFORMATION
Property, plant and equipment is depreciated using the straight-line
method, generally based on the following useful lives:
Asset lives
Buildings 25 years
Space segment assets 10 to 18 years
Ground segment assets 3 to 15 years
Other fixtures, fittings, tools and equipment 3 to 15 years
Right-of-use assets 6 to 12 years
An item of property, plant and equipment is derecognised upon dis-
posal or when no future economic benefits are expected from its use
or disposal. Any gain or loss arising on the derecognition of an asset
is included in the consolidated income statement in the period the
asset is derecognised. The residual values, remaining useful lives and
methods of depreciation of property, plant and equipment are
reviewed at each financial year end and adjusted where necessary.
For reimbursable capitalised costs related to the procurement of sat-
ellites, launches, and upgraded ground facilities as part of the U.S.
C-band repurposing project, the Group applies government grant
accounting. The Group records credits to the recorded book values
of the related asset when the costs have been incurred and the Group
has obtained reasonable assurance that the costs will be reimbursed
and that it will comply with the requirements attached to the reim-
bursement. See additional information in >> Note 33.
ASSETS IN THE COURSE OF CONSTRUCTION
This caption includes satellites under construction. Incremental costs
directly attributable to the purchase of satellites and bringing the
asset in the condition and location to be used as intended by
management, such as launch costs and other related expenses such
as ground equipment and borrowing costs, are capitalised as part of
the cost of the asset.
The cost of satellite construction may include an element of deferred
consideration to satellite manufacturers referred to as satellite
performance incentives. SES is contractually obligated to make these
payments over the lives of the satellites, provided the satellites
continue to operate in accordance with contractual specifications.
Therefore, SES accounts for these payments as deferred financing,
capitalising the present value of the payments as part of the cost of
the satellites and recording a corresponding liability to the satellite
manufacturers. An interest expense is recognised on the deferred
financing and the liability is accreted based on the passage of time
and reduced as the payments are made.
Once the asset is subsequently put into service and ready to operate
in the manner intended by management, the expenditure is trans-
ferred to assets in use and depreciation commences.
BORROWING COSTS
Borrowing costs that are directly attributable to the construction or
production of a qualifying asset are capitalised during the construc-
tion period as part of the cost of the asset. All other borrowing costs
are recognised as an expense in the period in which they are incurred.
INTANGIBLE ASSETS
1) Goodwill
Goodwill is measured as described in accounting policy for busi-
ness combinations in >> Note 2.
After initial recognition, goodwill is measured at cost less any
accumulated impairment losses. For impairment testing, goodwill
from the acquisition date is allocated to each of the Group’s CGUs
that are expected to benefit from the combination, irrespective
of whether other assets or liabilities of the Group are assigned
to those units.
The carrying value of acquisition goodwill is not amortised, but
rather is tested for impairment annually, or more frequently if
required to establish whether the value is still recoverable. The
recoverable amount is defined as the higher of: (1) fair value less
costs to sell and, (2) value in use. Impairment expenses are
recorded in the consolidated income statement. Impairment
losses relating to goodwill cannot be reversed in future periods.
The Group estimates value in use based on the estimated dis
-
counted cash flows to be generated by a CGU using five-year busi
-
ness plans approved by the Board of Directors. Beyond a five-year
period, cash flows are generally estimated on the basis of stable
rates of growth or decline, although longer periods may be con-
sidered where relevant to accurately calculate the value in use.
Where goodwill forms part of a CGU and part of the operation
within that unit is disposed of, then the goodwill associated with
the operation disposed of is included in the carrying amount of
the operation when determining the gain or loss on its disposal.
Goodwill disposed of in this situation is measured based on the
relative values of the operation disposed of and the portion of
the CGU unit retained.
2) Other intangibles
(i) Orbital rights
Intangible assets consist principally of rights of usage of orbital
frequencies. The Group is authorised by governments to operate
satellites at certain orbital locations. Governments acquire rights
to these orbital locations through filings made with the Interna-
tional Telecommunication Union (‘ITU’), a sub-organisation of
the United Nations. The Group will continue to have rights to
operate at its orbital locations so long as it maintains its
authorisations to do so. Those rights are reviewed at acquisition
to establish whether they represent assets with a definite or
indefinite life. Those assessed as being definite life assets are
amortised on a straight-line basis over their estimated useful life
not exceeding 30 years.
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Indefinite-life intangible assets are held at cost and are subject
to impairment testing in line with the treatment outlined for
goodwill above. Assets with indefinite lives are reviewed annually
to determine whether the indefinite life assessment continues
to be supportable. If not, the change in the useful life assessment
from indefinite to finite is made on a prospective basis. Orbital
rights acquired for a non-cash consideration are initially meas-
ured at the fair value of the consideration given.
(ii) Software and development costs
Costs associated with maintaining computer software are rec-
ognised as an expense as incurred. Development costs that are
directly attributable to the design and testing of identifiable and
unique software products controlled by the Group are recognised
as intangible assets when the following criteria are met:
•
it is technically feasible to complete the software product so that
it will be available for use;
• management intends to complete the software product and use
or sell it;
• there is an ability to use or sell the software product;
• it can be demonstrated how the software product will generate
probable future economic benefits;
•
adequate technical, financial and other resources to complete
the development and to use or sell the software product are
available; and
• the expenditure attributable to the software product during its
development can be reliably measured.
Directly attributable costs that are capitalised as part of the soft-
ware product include the software development employee costs
and an appropriate portion of relevant overheads. Other devel-
opment expenditures that do not meet these criteria are recog-
nised as an expense as incurred. Software development costs
recognised as assets are amortised over their estimated useful
life, not exceeding seven years.
IMPAIRMENT OF OTHER INTANGIBLE ASSETS
AND PROPERTY, PLANT AND EQUIPMENT
The Group assesses at each reporting date whether there is an indi-
cation that the carrying amount of the assets may not be recoverable.
If such an indication exists then the recoverable amount of the asset
or CGU is reviewed to determine the amount of the impairment, if any.
Impairments can arise from complete or partial failure of a satellite as
well as other changes in expected discounted future cash flows. Such
impairment tests are based on a recoverable value determined using
estimated future cash flows and an appropriate discount rate. The
estimated cash flows are based on the most recent business plans. If
an impairment is identified, the carrying value will be written down to
its recoverable amount.
INVESTMENTS AND OTHER FINANCIAL ASSETS
The Group classifies its financial assets in the following measurement
categories:
• those to be measured subsequently at fair value through profit or
loss; and
• those to be measured at amortised cost.
At initial recognition, the Group measures a financial asset at its fair
value plus, in the case of a financial asset not remeasured to fair value
through the income statement, transaction costs directly attributable
to the acquisition of the financial asset. Transaction costs of financial
assets carried at fair value and revalued through the income state-
ment are expensed in the period when they were incurred. All regular
purchases and sales of financial assets are recognised on the date
that the Group is committed to the purchase or sale of the asset.
Financial assets with embedded derivatives are considered in their
entirety when determining whether their cash flows are solely pay-
ment of principal and interest.
Equity investments
Unless SES has significant influence, the Group measures all equity
investments at fair value. Changes in the fair value of financial assets
are recognised in the consolidated income statement.
DEFERRED CUSTOMER CONTRACT COSTS
Deferred customer contract costs include the cost of equipment pro-
vided to customers under the terms of their service agreements, when
the equipment and services are not deemed to be distinct and are
expensed over the term of those contracts.
INVENTORIES
Inventories primarily consist of equipment held for re-sale, work-in-
progress, related accessories and network equipment spares and are
stated at the lower of cost and net realisable value, with cost deter-
mined on a weighted average-cost method.
Net realisable value is the estimated selling price in the ordinary
course of business less the estimated costs of completion and the
estimated costs necessary to make the sale.
TRADE RECEIVABLES
Trade receivables are recognised initially at fair value and subse-
quently measured at amortised cost using the effective interest
method, less provision for impairment. For impairment of trade receiv-
ables, the Group estimates expected lifetime credit losses that would
typically be carried for each receivable based on the credit risk class
upon the initial recognition of the receivables. Expected lifetime credit
losses are estimated based on historical financial information as well
as forward-looking data. Additional provisions are recognised when
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specific circumstances or forward-looking information lead the Group
to believe that additional collectability risk exists with respect to
customers that are not adequately reflected in loss expectancy rates.
The Group writes off trade receivables when it has no reasonable
expectation of recovery. The Group evaluates the credit risk of its
customers on an ongoing basis.
TRADE AND OTHER PAYABLES
Trade and other payables are initially recognised at fair value, and
subsequently carried at amortised cost using the effective interest
method.
PREPAYMENTS
Prepayments represent expenditures paid during the financial year
but relating to a subsequent financial year. The prepaid expenses
comprise mainly insurance, rental of third-party satellite capacity,
advertising expenses as well as loan origination costs related to loan
facilities which have not been drawn.
TREASURY SHARES
Treasury shares are mostly acquired by the Group in connection with
share-based compensation plans and are presented as a set off to
equity in the consolidated statement of financial position. Gains and
losses on the purchase, sale, issue or cancellation of treasury shares
are not recognised in the consolidated income statement, but rather
in the equity.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash at banks and on hand,
deposits and short-term, highly liquid investments readily convertible
to known amounts of cash and subject to insignificant risk of changes
in value. Cash on hand and in banks and short-term deposits which
are held to maturity are carried at fair value.
REVENUE RECOGNITION
Revenues are generated predominantly from customer service agree-
ments for the provision of satellite capacity over contractually agreed
periods, including short-term occasional use capacity, with the asso-
ciated uplinking and downlinking services as appropriate. Other rev-
enue-generating activities mainly include sale of customer equipment;
platform services; subscription revenue; income received in connec-
tion with satellite interim missions; installation and other engineering
services and proceeds from the sale of transponders if the revenue
recognition criteria for the transaction are met.
Revenue is measured based on the consideration to which the Group
expects to be entitled in a contract with a customer and excludes
amounts collected on behalf of third parties. The Group recognises
revenue when or as it transfers control of a good or service to a
customer.
Contract modifications are accounted for either as a separate contract
or as part of the existing contract, depending on the nature of the
modification. The Group accounts for a modification as a separate
contract if:
•
the scope of the contract increases because of the addition of
distinct goods or services, and
• the price of the contract increases by an amount of consideration
that reflects the stand-alone selling prices of the additional goods
or services.
A modification that does not meet the above criteria to be accounted
for as a separate contract is accounted for as an adjustment to the
existing contract, either prospectively or through a cumulative
catch-up adjustment. The determination depends on whether the
remaining goods or services to be provided to the customer under
the modified contract are distinct from those already provided, in
which case the modification results in a prospective adjustment to
revenue recognition.
Where a contract contains elements of variable consideration, the
Group estimates the amount of variable consideration to which it will
be entitled under the contract. Variable consideration can arise, for
example, as a result of variable prices, incentives or other similar items.
Variable consideration is only included in the transaction price if, and
to the extent that, it is highly probable that its inclusion will not result
in a significant revenue reversal in the future when the uncertainty
has been subsequently resolved.
The Group occasionally receives non-cash consideration as part of a
revenue transaction. The Group measures non-cash consideration at
fair value unless it is unable to reasonably estimate fair value, in which
case the Group measures the consideration indirectly based on the
standalone selling price of the goods or services promised to the cus-
tomer.
Revenue from provision of satellite capacity
For the Group’s contracts to provide satellite capacity, the Group
makes capacity available to customers in a series of time periods that
are distinct and have the same pattern of transfer to the customer.
Revenue from customers under service agreements for satellite
capacity is recognised on a straight-line basis over the duration of
the respective contracts, including any free-of-charge periods. Using
a straight-line measure of progress most faithfully depicts the Group’s
performance because the Group makes available a consistent level
of capacity over each distinct time period. Revenue will cease to be
recognised if there is an indication of a significant deterioration in a
customer’s ability to pay for the remaining goods or services.
Revenue from the sale of equipment
The Group recognises revenue for the sale of equipment when it
transfers control of the equipment to the customer, which is typically
when the Group transfers title, physical possession, and the signifi-
cant risks and rewards of the equipment to the customer. The Group’s
equipment contracts do not typically contain a right of return.
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ADDITIONAL
INFORMATION
For contracts in which the Group sells both equipment and capacity
services, the Group evaluates at contract inception whether the
equipment and capacity services represent separate performance
obligations. When they represent separate performance obligations,
the Group allocates consideration to the equipment and services
based on relative standalone selling prices using either an expected
cost plus a margin approach or an adjusted market assessment
approach. When they do not represent separate performance obliga-
tions, the Group records revenue related to the single performance
obligation over the contract period.
For equipment sales requiring the Group to perform significant
integration, modification, or customisation of equipment, the Group
recognises revenue over time if the equipment does not have an
alternative use and the Group has an enforceable right to payment
for performance completed to date. For these projects, the Group
recognises revenue over time on a basis reflecting the costs incurred
to date relative to the total costs expected to be incurred because
costs incurred best reflect the pattern of transfer of control of the
asset to the customer.
The Group may offer warranties on equipment. For warranties that
are separately priced or offered as extended warranties, the Group
recognises revenue on a straight-line basis over the duration of the
warranty period. Using a straight-line measure of progress most faith-
fully depicts the Group’s performance due to the nature of the Group’s
stand ready obligation during the warranty period. The Group also
offers standard warranties with contract durations which are typically
one year and represent assurance-type warranties. Standard warran-
ties do not represent performance obligations separate from the
related equipment, and revenue related to standard warranties is
recognised at the same time as the related equipment.
Subscription revenue
The subscription revenue related to HD Plus services is recorded on
a linear basis over the term of the subscription agreement.
Proceeds from sale of transponders
The proceeds of transponder sales are recognised in the period of
the transaction at the time the Group transfers control of the
transponders, which generally corresponds to the timing of transfer
of title and risks and rewards associated with the holding of the
transponders.
Revenue generated by engineering services
For engineering services, the Group recognises revenue over time on
a basis reflecting the costs incurred to date relative to the total costs
expected to be incurred since this best reflects the pattern of transfer
of control of the services to the customer.
LEASE INCOME
Lease income from operating leases where the Group is lessor is
recognised on a straight-line basis over the lease term. The respec-
tive right-of-use assets are included in the consolidated statement of
financial position together with other assets of the same category.
C-BAND REPURPOSING INCOME
Income from successfully meeting the separate Phase 1 and Phase 2
C-band Accelerated Relocation Payment deadlines is recognised
when the Group has successfully completed Phase 1 and Phase 2
Accelerated Relocations, respectively, and has received validation of
the respective relocation certifications from the U.S. Federal Commu-
nications Commission’s (“FCC”) Wireless Telecommunications Bureau.
Income arising from settlements from the Relocation Payment Clear-
inghouse (‘the Clearinghouse’) are recognised when the expenses
have been incurred and the Group has obtained reasonable assurance
that the costs will be reimbursed and that it will comply with the
requirements attached to the reimbursement. The Group believes it
obtains such reasonable assurance either when the Clearinghouse
specifically validates the costs as being reimbursable, or where the
costs fall within applicable cost ranges published by the Clearing-
house in its cost catalogue. More details are given in >> Note 33.
OTHER INCOME
Other income arising from settlements under insurance claims and
decreases in provisions for in-orbit incentives are recognised when
they are virtually certain of being realised. Other income is presented
as part of revenue due to its relative insignificance.
CONTRACT ASSETS AND CONTRACT LIABILITIES
Assets and liabilities related to contracts with customers include trade
receivables, unbilled accrued revenue, deferred customer contract
costs, and deferred income.
Customer payments received in advance of the provision of service
are recorded as contract liabilities and presented as ‘deferred income’
in the statement of financial position, and for significant advance pay-
ments, interest is accrued on the amount received at the effective
interest rate at the time of receipt. Our contracts at times contain
prepayment terms that range from one month in advance to one year
in advance of providing the service. Since the period of time between
when the Group transfers a promised good or service to a customer
and when the customer pays for that good or service is one year or
less, the Group does not make an adjustment to the transaction price
for the effects of a significant financing component.
The unbilled portion of recognised revenues is recorded as a contract
asset and presented as ‘unbilled accrued revenue’ within ‘Trade and
other receivables’, allocated between current and non-current as
appropriate.
Customer payments are generally due in advance or by the end of
the month of capacity service.
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ADDITIONAL
INFORMATION
DIVIDENDS
The Company declares dividends after the consolidated financial state-
ments for the year have been approved. Accordingly, dividends are
recorded in the subsequent year’s consolidated financial statements.
PROVISIONS
Provisions are recognised when the Group has a present legal or con-
structive obligation as a result of a past event and it is probable that
an outflow of resources embodying economic benefits will be required
to settle the obligation and the amount can be reliably estimated.
Provisions are measured at the present value of management’s best
estimate of the expenditure required to settle the present obligation
at the end of the reporting period.
BORROWINGS
Borrowings are recognised initially at fair value, net of transaction
costs incurred. Borrowings are subsequently carried at amortised cost;
any difference between the proceeds (net of transaction costs) and
the redemption value is recognised in the consolidated income state-
ment over the period of the borrowings using the effective interest
method.
Fees paid on the establishment of loan facilities are recognised as
origination costs of the loan to the extent that it is probable that some
or all of the facility will be drawn down. In this case, the fee is deferred
until the draw-down occurs.
CURRENT TAXES
Current tax assets and liabilities for current and prior periods are
measured at the amount expected to be recovered from, or paid to,
the tax authorities. The tax rates and laws used to compute these
amounts are those enacted, or substantively enacted, at the report-
ing date.
DEFERRED TAXES
Deferred tax is determined using the liability method on temporary
differences between the tax bases of assets and liabilities and their
carrying amounts for financial reporting purposes at the reporting
date.
Deferred tax liabilities are recognised for all taxable temporary differ-
ences, except:
• where the deferred tax liability arises from the initial recognition of
goodwill or of an asset or liability in a transaction that is not a busi-
ness combination and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss; and
•
in respect of taxable temporary differences associated with
investments in subsidiaries where the timing of the reversal of the
temporary differences can be controlled and it is probable that
the temporary differences will not reverse in the foreseeable
future.
Deferred tax assets are recognised for all deductible temporary
differences, carry-forward of unused tax credits and unused tax
losses, to the extent that it is probable that taxable profit will be avail
-
able against which the deductible temporary differences, and the
carry-forward of unused tax credits and unused tax losses can be
utilised except:
• where the deferred tax asset relating to the deductible temporary
difference arises from the initial recognition of an asset or liability
in a transaction that is not a business combination and, at the time
of the transaction, affects neither the accounting profit nor taxable
profit or loss; and
•
in respect of deductible temporary differences associated with
investments in subsidiaries, deferred tax assets are recognised only
to the extent that it is probable that the temporary differences will
reverse in the foreseeable future and taxable profit will be available
against which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at each report-
ing date and reduced to the extent that it is no longer probable that
sufficient taxable profit will be available to allow all or part of the
deferred tax asset to be utilised. Unrecognised deferred tax assets
are reassessed at each reporting date and are recognised to the
extent that it has become probable that future taxable profit will allow
the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that
are expected to apply to the year when the asset is realised or the
liability is settled, based on tax rates and tax laws which have been
enacted, or substantively enacted, at the reporting date.
Deferred taxes are classified according to the classification of the
underlying temporary difference either as income or as an expense
included in profit or loss, or in other comprehensive income or directly
in equity.
Tax benefits acquired as part of a business combination, but not
satisfying the criteria for separate recognition at that date, are
recognised subsequently if new information about facts and circum-
stances change. The adjustment is either treated as a reduction in
goodwill (as long as it does not exceed goodwill) if it was incurred
during the measurement period or recognised in profit or loss.
Deferred tax assets and liabilities are offset, if a legally enforceable
right exists to set off current tax assets against current tax liabilities
and the deferred taxes relate to the same taxable entity and the same
taxation authority.
SES ANNUAL REPORT 2021111
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
TRANSLATION OF FOREIGN CURRENCIES
The consolidated financial statements are presented in euro (€),
which is the Company’s functional and presentation currency. Each
entity in the Group determines its own functional currency and items
included in the financial statements of each entity are measured using
that functional currency.
Transactions in foreign currencies are initially recorded in the entity’s
functional currency at the exchange rate prevailing at the date of the
transaction. The cost of non-monetary assets is translated at the rate
applicable at the date of the transaction. All other assets and liabili-
ties are translated at closing rates of the period. During the year,
expenses and income expressed in foreign currencies are recorded
at exchange rates which approximate the rate prevailing on the date
they occur or accrue. All exchange differences resulting from the
application of these principles are included in the consolidated
income statement.
The Group considers that monetary long-term receivables or loans
with a subsidiary that is a foreign operation for which settlement is
neither planned nor likely to occur in the foreseeable future is, in
substance, a part of the entity’s net investment in that foreign oper-
ation. The related foreign exchange differences and income tax effect
of the foreign exchange differences are included in the foreign cur-
rency translation reserve within equity. On disposal of a foreign oper-
ation, the deferred cumulative amount recognised in equity relating
to that foreign operation is reclassified to the consolidated income
statement.
Goodwill and fair value adjustments arising on the acquisition of a
foreign entity are treated as assets and liabilities of the foreign entity
and translated at the closing rate.
The assets and liabilities of consolidated foreign operations are trans-
lated into euro at the year-end exchange rates, while the income and
expense items of these foreign operations are translated at the
average exchange rate of the year. The related foreign exchange
differences are included in the foreign currency translation reserve
within equity. On disposal of a foreign operation, the deferred cumu-
lative amount recognised in equity relating to that foreign operation
is reclassified to the consolidated income statement as part of the
gain or loss on disposal.
The US dollar exchange rates used by the Group during the year were
as follows:
$ Exchange Rate
Average rate
for 2021
Closing rate
for 2021
Average rate
for 2020
Closing rate
for 2020
$ 1.1894 1.1326 1.1384 1.2271
BASIC EARNINGS PER SHARE
The Company’s capital structure consists of Class A and Class B
shares, entitled to the payment of annual dividends as approved by
the shareholders at their annual meetings. Holders of Class B shares
participate in earnings and are entitled to 40% of the dividends
payable per Class A share. Basic earnings per share is calculated by
dividing the net profit attributable to ordinary shareholders, adjusted
by deducting the assumed coupon, net of tax, on the perpetual bonds,
by the weighted average number of common shares outstanding
during the period as adjusted to reflect the economic rights of each
class of shares.
DILUTED EARNINGS PER SHARE
Diluted earnings per share adjusts the figures used in the determi-
nation of basic earnings per share to reflect the weighted average
number of additional ordinary shares that would have been out-
standing assuming the conversion of all dilutive potential ordinary
shares.
HEDGE OF A NET INVESTMENT IN A FOREIGN
OPERATION
Changes in the fair value of a derivative or non-derivative instrument
that is designated as a hedge of a net investment are recorded in the
foreign currency translation reserve within equity to the extent that
it is deemed to be an effective hedge. The ineffective portion is
recognised in the consolidated income statement as finance income
or cost.
Hedge accounting is discontinued when the hedging instrument
expires or is sold, terminated or exercised, the hedge no longer
qualifies for hedge accounting, or the Group revokes the designation.
At that point in time, any cumulative gain or loss on the hedging
instrument recognised in equity is kept in equity until the forecasted
transaction occurs. If a hedged transaction is no longer expected to
occur, the net cumulative gain or loss recognised in equity is trans-
ferred to net profit or loss for the period.
The Group formally documents all relationships between hedging
instruments and hedged items, as well as its risk-management objec-
tive and strategy for undertaking various hedge transactions. This
process includes allocating all derivatives that are designated as net
investment hedges to specific assets and liabilities in the consolidated
statement of financial position. The Group also formally assesses both
at the inception of the hedge and on an ongoing basis, whether each
derivative is highly effective in offsetting changes in fair values or
cash flows of the hedged item. If it is determined that a derivative is
not highly effective as a hedge, or if a derivative ceases to be a highly
effective hedge, the Group will discontinue hedge accounting
prospectively. The ineffective portion of hedge is recognised in profit
or loss.
SES ANNUAL REPORT 2021112
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
DERECOGNITION OF FINANCIAL ASSETS
AND LIABILITIES
1) Financial assets
A financial asset is derecognised where:
• the right to receive cash flows from the asset has expired;
• the Group retains the right to receive cash flows from the asset but
has assumed an obligation to pay them in full without material delay
to a third party under a ‘pass-through’ arrangement;
• the Group has transferred its rights to receive cash flows from the
asset and either:
a) has transferred substantially all the risks and rewards of the
asset; or
b) has neither transferred nor retained substantially all the risks and
rewards of the asset but has transferred control of that asset.
2) Financial liabilities
A financial liability is derecognised when the obligation under the lia-
bility is discharged, cancelled or expired. Where an existing financial
liability is replaced by another from the same lender on substantially
different terms, or the terms of an existing liability are substantially
modified, such an exchange or modification is treated as a derecog-
nition of the original liability and the recognition of a new liability, and
the difference in the respective carrying amount is recognised in profit
or loss.
Offsetting financial instruments
Financial assets and liabilities are offset, and the net amount reported
in the consolidated statement of financial position, when there is a
legally enforceable right to offset the recognised amounts and there
is an intention to settle on a net basis or realise the asset and settle
the liability simultaneously. The legally enforceable right must not be
contingent on future events and must be enforceable in the normal
course of business and in the event of default, insolvency or bank-
ruptcy of the Company or the counterparty.
ACCOUNTING FOR PENSION OBLIGATIONS
The Company and certain subsidiaries operate defined contribution
pension plans.
A defined contribution plan is a pension plan under which the Group
pays fixed contributions to a third-party financial institution. The
Group has no legal or constructive obligation to pay further contri-
butions if the financial institution’s pension fund does not hold suffi-
cient assets to pay all employees the benefits relating to employee
service in the current and prior periods.
For defined contribution plans, the Group pays contributions to
publicly or privately administered pension insurance plans on a
mandatory, contractual or voluntary basis. The Group has no further
payment obligations once the contributions have been paid. The con-
tributions are recognised as employee benefit expense when they are
due. Prepaid contributions are recognised as an asset to the extent
that a cash refund or a reduction in the future payments is available.
SHARE-BASED PAYMENTS
1) Equity-settled share-based compensation plans
Employees (including senior executives) of the Group receive remu-
neration in the form of share-based compensation transactions,
whereby employees render services as consideration for equity instru-
ments (‘equity-settled transactions’). The cost of equity-settled trans-
actions is measured by reference to the fair value at the date on which
they are granted. The fair value is determined by an external valuer
using a binomial model for the Stock Appreciation Rights Plan (‘STAR
Plan’) and Equity Based Compensation Plan comprising options
(‘EBCP Option Plan’), and a Black Scholes Model for the Equity Based
Compensation Plan comprising performance shares (‘EBCP PS’) and
restricted shares (‘EBCP RS’). Further details are given in >> Note 22.
In valuing equity-settled transactions, no account is taken of any
non-market performance conditions, the valuation being linked only
to the price of the Company’s shares, if applicable.
The cost of equity-settled transactions is recognised, together with
a corresponding increase in equity, over the period in which the per-
formance and/or service conditions are fulfilled, ending on the date
on which the relevant employees become fully entitled to the award
(the vesting date). The cumulative expense recognised for equity-set-
tled transactions at each reporting date until the vesting date reflects
the extent to which the vesting period has expired and the Group’s
best estimate of the number of equity instruments that will ultimately
vest. The consolidated income statement charge or credit for a period
represents the movement in the cumulative expense recognised as
at the beginning and end of that period. No expense is recognised for
awards that do not ultimately vest.
The dilutive effect of outstanding options is reflected as additional
share dilution in the computation of earnings per share >> Note 10.
2) Cash-settled share-based compensation plans
A liability is recognised for the fair value of cash-settled transactions.
The fair value is measured initially at each reporting date up to and
including the settlement date, with changes in fair value recognised
in employee benefits expense. The fair value is expensed over the
period until the vesting date with recognition of a corresponding lia-
bility. The fair value is determined using a binomial model, further
details of which are given in >> Note 22.
DEEPLY SUBORDINATED FIXED RATE
RESETTABLE SECURITIES (“PERPETUAL BOND”)
The deeply subordinated fixed rate securities issued by the Company
are classified as equity since the Company has no contractual
obligation to redeem the securities, and coupon payments may be
deferred under certain circumstances (more details are given in
>> Note 20 and recorded at fair value. Subsequent changes in fair
value are not recognised in equity. Coupons become payable when-
ever the Company makes dividend payments. Coupon accruals are
considered in the determination of earnings for calculating earnings
per share >> Note 10.
SES ANNUAL REPORT 2021113
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
LEASES
The determination as to whether an arrangement is, or contains, a
lease is based on the substance of the arrangement at the inception
date, primarily whether the contract conveys the right to control the
use of an identified asset for a period of time in exchange for consid-
eration. Control is conveyed where the Group as lessee has both the
right to direct the identified asset’s use and to obtain substantially all
the economic benefits from that use.
Assets and liabilities arising from a lease are initially measured on a
present value basis. Lease liabilities include the net present value of
the following lease payments:
• fixed payments (including in-substance fixed payments), less any
lease incentives receivable;
• variable lease payments that are based on an index or a rate;
•
amounts expected to be payable by the lessee under residual value
guarantees;
• the exercise price of a purchase option if the lessee is reasonably
certain to exercise that option; and
• payments of penalties for terminating the lease, if the lease term
reflects the lessee exercising that option.
Lease payments are discounted using the interest rate implicit in the
lease, if that rate can be determined, or the Group’s incremental bor-
rowing rate. At the commencement of a lease the Group recognises
a lease asset and a lease liability. The lease liability is initially meas-
ured at the present value of the lease payments payable over the
lease term, discounted at the rate implicit in the lease. Lease pay
-
ments are apportioned between the finance charges and reduction
of the lease liability to achieve a constant rate of interest on the
remaining balance of the liability. Finance costs are charged directly
to expense.
In its accounting policies the Group applies the following practical
expedients:
•
using a single discount rate for a portfolio of leases with similar
characteristics; and
• not accounting for leases ending within 12 months of the date of
the initial application, or where the underlying asset has a low value.
NEW STANDARDS AND INTERPRETATIONS
NOT YET ADOPTED
A number of new standards and amendments to standards and inter-
pretations are relevant for the Group and effective for annual periods
beginning on or after 1 January 2022, and have not been early adopted
in preparing these consolidated financial statements:
1) Amendments to IAS 1 on classification of liabilities
as current or non-current
On 23 January 2020, the IASB issued “Classification of Liabili-
ties as Current or Non-Current (Amendments to IAS 1)”. The
amendment will affect the presentation of liabilities in the con-
solidated statement of financial position. The amendment clar-
ifies that the classification of a liability as current or non-current
should be based on rights in existence at the end of the report-
ing period to defer settlement of a liability by at least 12 months.
The amendment also clarifies that the classification of a liability
should be unaffected by the entity’s expectations regarding
whether it will exercise its rights to defer payment. The amend-
ment is effective for annual reporting periods beginning on or
after 1 January 2023. The amendment was not yet endorsed by
the EU. The Group does not expect any significant impact of
these amendments on its consolidated financial statements.
2) Amendment to IFRS 3, IAS 16, IAS 37 and
annual improvements 2018-2020
Amendments to IFRS 3, “Business combinations” update a refer-
ence in IFRS 3 to the Conceptual Framework for Financial Report-
ing without changing the accounting requirements for business
combinations.
Amendments to IAS 16, “Property, plant and equipment” prohibit
a company from deducting from the cost of property, plant and
equipment amounts received from selling items produced while
the company is preparing the asset for its intended use. Instead,
a company will recognise such sales proceeds and related cost
in profit or loss.
Amendments to IAS 37, “Provisions, contingent liabilities and
contingent assets” specify which costs a company includes when
assessing whether a contract will be loss-making.
Annual improvements make minor amendments to o IFRS 1,
“First-time adoption of IFRS”, IFRS 9. “Financial instruments”,
IAS 41. “Agriculture” and the illustrative examples accompanying
IFRS 16, ‘Leases’.
The amendments were endorsed by the EU and are effective for
annual reporting periods beginning on or after 1 January 2022.
The Group does not expect any significant impact of these
amendments on its consolidated financial statements.
3) Amendments to IAS 1 and IAS 8
On 12 February 2021, the IASB issued amendments to IAS 1
“Presentation of Financial Statements” regarding the disclosure
of accounting policies and as well amendments to IAS 8
“Accounting policies, changes in accounting estimates and
errors” on the definition of accounting estimates. Both amend-
ments aim to improve accounting policy disclosure and to help
users of the financial statements to distinguish between changes
in accounting estimates and changes in accounting policies. The
amendments were not yet endorsed by the EU and are effective
for annual periods beginning on or after 1 January 2023. The
Group does not expect any significant impact of these amend-
ments on its consolidated financial statements.
SES ANNUAL REPORT 2021114
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
4) Amendments to IAS 12 related to assets and liabilities
arising from a single transaction
On 6 May 2021, the IASB published the amendments to IAS 12
“Income taxes” regarding the deferred tax related to assets and
liabilities arising from a single transaction, that clarifies how com-
panies account for deferred tax on transactions such as leases
and decommissioning obligations. The amendments were not
yet endorsed by the EU and are effective for annual periods
beginning on or after 1 January 2023. The Group does not expect
any significant impact of these amendments on its consolidated
financial statements.
NOTE 3 – SEGMENT INFORMATION
The Group does business in one operating segment, namely the
provision of satellite-based data transmission capacity, and ancillary
services, to customers around the world.
The Senior Leadership Team (‘SLT’), which is the chief operating
decision-making committee in the Group’s corporate governance
structure, reviews the Group’s financial reporting and generates those
proposals for the allocation of the Group’s resources which are
submitted for validation to the Board of Directors. The main sources
of financial information used by the SLT in assessing the Group’s
performance and allocating resources are:
•
analyses of the Group’s revenues from its business units SES Video
and SES Networks (comprising the sales verticals Fixed Data,
Mobility and Government);
• cost and overall Group profitability development;
• internal and external analyses of expected future developments in
the markets into which capacity is being delivered and of the
commercial landscape applying to those markets.
When analysing the performance of the operating segment against
the prior period figures, these are presented both as reported and at
‘constant FX’, whereby they are recomputed using the prevailing
exchange rates for each corresponding month of the current period.
The segment’s financial results for 2021 are set out below:
Operating Profit Reported
€ MILLION 2021 2020
Change
Favourable
+/- Adverse
Revenue 1,782 1,876 -5.0%
C-band repurposing income 901 10 N/m
Operating expenses (821) (807) -1.7%
EBITDA 1,862 1,079 72.6%
EBITDA margin (%) 69.4% 57.2% 12.2% pts
Depreciation and impairment (626) (808) 22.5%
Amortisation and impairment (768) (189) N/m
Operating profit 468 82 N/m
Adjusted EBITDA 1,091 1,152 -5.2%
Adjusted EBITDA margin 61.2% 61.4% -0.3% pts
C-band repurposing income 901 10 N/m
C-band operating expenses (122) (43) N/m
Restructuring expenses (8) (40) 80.0%
EBITDA 1,862 1,079 72.6%
Operating Profit at Constant FX
€ MILLION 2021
Constant
FX
2020
Change
Favourable
+/- Adverse
Revenue 1,782 1,835 -2.9%
C-band repurposing income 901 11 N/m
Operating expenses (821) (789) -4.1%
EBITDA 1,862 1,057 76.2%
EBITDA margin (%) 69.4% 57.6% 11.8% pts
Depreciation and impairment (626) (802) 21.9%
Amortisation and impairment (768) (190) N/m
Operating profit 468 65 N/m
Adjusted EBITDA 1,091 1,128 -3.3%
Adjusted EBITDA margin 61.2% 61.4% -0.3% pts
C-band repurposing other income 901 11 N/m
C-band operating expenses (122) (42) N/m
Restructuring expenses (8) (40) 80.0%
EBITDA 1,862 1,057 76.2%
SES ANNUAL REPORT 2021115
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
REVENUE BY BUSINESS UNIT
As reported and at constant FX, the revenue allocated to the relevant
business units developed as follows:
Revenue by Business Unit 2021 and 2020
€
MILLION
2021 2020
Constant
FX 2020
Change
Favourable
+/-
Adverse
Change
Favourable
+/- Adverse
(constant
FX)
SES Video 1,046 1,108 1,097 -5.6% -4.6%
Under-
lying
1
1,046 1,108 1,097 -5.6% -4.6%
Periodic
2
– – – N/m N/m
SES Net-
works 735 767 737 -4.2% -0.4%
Under-
lying
1
734 759 730 -3.3% 0.5%
Periodic
2
1 8 7 -86.3% -85.0%
Sub-total 1,781 1,875 1,834 -5.0% -2.9%
Under-
lying
1
1,780 1,867 1,827 -4.7% -2.6%
Periodic
2
1 8 7 -86.3% -85.0%
Other
3
1 1 1 N/m N/m
Group Total 1,782 1,876 1,835 -5.0% -2.9%
Revenue by Business Unit 2020 and 2019
€
MILLION
2020 2019
Constant
FX 2019
Change
Favourable
+/-
Adverse
Change
Favourable
+/- Adverse
(constant
FX)
SES Video 1,108 1,213 1,208 -8.6% -8.3%
Under-
lying
1
1,108 1,210 1,205 -8.4% -8.0%
Periodic
2
– 3 3 N/m N/m
SES Net-
works 767 762 747 +0.6% +2.6%
Under-
lying
1
759 734 720 +3.4% +5.3%
Periodic
2
8 28 27 -71.5% -70.3%
Sub-total 1,875 1,975 1,955 -5.1% -4.1%
Under-
lying
1
1,867 1,944 1,925 -4.0% -3.0%
Periodic
2
8 31 30 -74.3% -73.3%
Other
3
1 9 9 N/m N/m
Group Total 1,876 1,984 1,964 -5.4% -4.5%
REVENUE BY CATEGORY
The Group’s revenue analysis from the point of view of category and
timing can be found below:
Revenue by Category 2021
€ MILLION
Revenue
recognised
at a point
in time
Revenue
recognised
over time Total
Revenue from contracts
with customers 28 1,722 1,750
Lease income – 32 32
Total 28 1,754 1,782
Revenue by Category 2020
€ MILLION
Revenue
recognised
at a point
in time
Revenue
recognised
over time Total
Revenue from contracts
with customers 20 1,816 1,836
Lease income – 40 40
Total 20 1,856 1,876
Revenue from contracts with customers recognised at a point in time
is related to sales of equipment and amounts to € 28 million in 2021
(2020: € 20 million).
1 “Underlying” revenue represents the core business of capacity sales, as well as associated services and equipment. This revenue may be impacted by changes in launch schedule
and satellite health status.
2. “Periodic” revenue separates revenues that are not directly related to or would distort the underlying business trends. Periodic revenue includes: the outright sale of transponders
or transponder equivalents; accelerated revenue from hosted payloads during the course of construction; termination fees; insurance proceeds; certain interim satellite missions
and other such items when material
3 Other includes revenue not directly applicable to SES Video or SES Networks
SES ANNUAL REPORT 2021116
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
REMAINING PERFORMANCE OBLIGATIONS
Our remaining performance obligations, which the Group refers to as
revenue “backlog,” represent our expected future revenues under
existing customer contracts and include both cancellable and
non-cancellable contracts. The backlog was € 5.8 billion as of Decem-
ber 31, 2021 (2020: € 6.1 billion), € 5.2 billion (2020: € 5.6 billion) of
which related to ‘protected’ backlog and € 0.6 billion (2020: € 0.5 bil-
lion) of which related to ‘unprotected’ backlog. Approximately 25% of
the backlog is expected to be recognised as revenue in 2022, approx-
imately 21% in 2023, and approximately 17% in 2024, with the remain-
ing thereafter.
Protected backlog includes non-cancellable contracts and cancella-
ble contracts with substantive termination fees. For contracts with
termination options that do not have substantive termination fees,
protected backlog also includes contract periods up to the first
optional termination date. Unprotected backlog includes revenue from
contracts that are cancellable and not subject to substantive termi-
nation fees.
REVENUE BY COUNTRY
The Group’s revenue from external customers analysed by country
using the customer’s billing address is as follows:
Revenue by Country
€ MILLION 2021 2020
Luxembourg (SES country of domicile) 54 54
United States of America 554 590
Germany 355 368
United Kingdom 212 232
France 78 94
Others – Europe 203 196
Others 326 342
Total 1,782 1,876
No single customer accounted for 10%, or more, of total revenue in
2021, or 2020.
PROPERTY, PLANT AND EQUIPMENT AND
INTANGIBLE ASSETS BY LOCATION
The Group’s property, plant and equipment and intangible assets are
located as set out in the following table. Note that satellites are allo-
cated to the country where the legal owner of the asset is incorporated.
Property, Plant and Equipment and
Intangible Assets by Location
€ MILLION 2021 2020
Luxembourg (SES country of domicile) 5,767 4,754
United States of America 2,036 2,808
The Netherlands 1,206 1,183
Isle of Man – 900
Sweden 145 160
Germany 45 48
Israel 27 30
Others 125 130
Total 9,351 10,013
NOTE 4 – OPERATING EXPENSES
The operating expense categories disclosed include the following
types of expenditure:
1) Cost of sales, which excludes staff costs and depreciation, rep-
resents expenditures which generally vary directly with revenue.
They are incurred in delivering services to customers and include
a variety of expenses such as rental of third-party satellite capac-
ity, third-party teleports, connectivity, equipment and equipment
rental, customer support costs such as hosting, monitoring,
implementation, engineering work as well as commissions. Other
cost of sales detailed below include an amount of € 51 million
(2020: € 12 million) for C-band repurposing related expenses
>> Note 33.
Cost of Sales
€ MILLION 2021 2020
Rental of third-party satellite capacity (68) (82)
Customer support costs (72) (55)
Other cost of sales (179) (154)
Total cost of sales (319) (291)
2) Staff costs of € 304 million (2020: € 330 million) include gross
salaries and employer’s social security payments, payments into
pension schemes for employees, charges arising under share-
based payment schemes, as well as staff-related restructuring
charges of € 8 million (2020: € 38 million) and C-band repurpos-
ing related expenses of € 36 million (2020: € 15 million). At the
year-end the total full-time equivalent number of members of
staff was 2,037 (2020: 2,095).
3) Other operating expenses of € 198 million (2020: € 186 million)
are, by their nature, less variable to revenue development. Such
costs include office-related and technical facility costs, in-orbit
insurance costs, marketing expenses, general and administrative
expenditure, consulting charges, travel-related expenditure and
movements in provisions for debtors. Other operating expenses
also include an amount of nil (2020: € 2 million) of restructuring
charges in connection with the Group’s ongoing optimisation
programme >> Note 24 and as well an amount of € 35 million
(2020: € 16 million) C-band repurposing related expenses
>> Note 33.
SES ANNUAL REPORT 2021117
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 5 – AUDIT AND NON-AUDIT FEES
For 2021 and 2020 the Group recorded charges, billed and accrued,
from its independent auditors, and affiliated companies thereof, as
set out below:
Audit and Non-Audit Fees
€ MILLION 2021 2020
Fees for statutory audit of annual and consoli-
dated accounts 2.1 2.2
Fees charged for other assurance services 0.1 0.1
Fees charged for other non-audit services – –
Total audit and non-audit fees 2.2 2.3
‘Other assurance services’ represent primarily comfort letters issued in
connection with treasury funding operations and interim dividend reviews.
NOTE 6 – FINANCE INCOME AND COSTS
Finance Income and Costs
€ MILLION 2021 2020
Finance income
Interest income – 1
Net foreign exchange gains
1
37 –
Fair value increases on financial assets
2
13 –
Total 50 1
Finance costs
Interest expense on borrowings
(excluding amounts capitalised) (95) (123)
Loan fees and origination costs and other (26) (30)
Net foreign exchange losses
1
– (32)
Total (121) (185)
1 Net foreign exchange gains/losses are mostly related to revaluation of bank
accounts, deposits and other monetary items denominated in US dollars.
2 Represents fair value increases on assets included as part of ‘Other financial assets’
in the consolidated statement of financial position and required to be measured at
fair value following recent third-party transactions
NOTE 7 – INCOME TAXES
Taxes on income comprise the taxes paid or owed in the individual
countries, as well as deferred taxes. Current and deferred taxes can
be analysed as follows:
Income Taxes
€ MILLION 2021 2020
Current income tax
Current income tax charge on result of the year (163) (38)
Adjustments in respect of prior periods 9 (4)
Foreign withholding taxes (7) (9)
Total current income tax (161) (51)
Deferred income tax
Relating to origination and reversal of temporary
differences (23) 73
Relating to tax losses carried forward 251 7
Changes in tax rate 6 (12)
Adjustment of prior years (24) (10)
Total deferred income tax 210 58
Income tax benefit per
consolidated income statement 49 7
Consolidated statement of changes in equity
Current and Deferred Income tax related to items
(charged) or credited directly in equity
Post-employment benefit obligation (1) 1
Impact of currency translation (36) 35
Net investment hedge – current tax 26 (29)
Tax impact of the treasury shares impairment
recorded in the stand-alone financial statements 1 6
Tax impact on perpetual bond 20 18
Current and deferred income taxes reported
in equity 10 31
A reconciliation between the income tax benefit and the profit before
tax of the Group multiplied by a theoretical tax rate of 25.69% (2020:
25.69%) which corresponds to the Luxembourg domestic tax rate for
the year ended 31 December 2021 is as follows:
Income Tax Reported in the
Consolidated Income Statement
€ MILLION 2021 2020
Profit/(loss) before tax from continuing
operations 397 (102)
Multiplied by theoretical tax rate 102 (26)
Effect of different foreign tax rates 14 4
Investment tax credits (44) (64)
Tax exempt income – –
Non-deductible expenditures 2 9
Taxes related to prior years 3 4
Effect of changes in tax rate (5) 15
Other changes in group tax provision
not included in separate lines (3) –
Impairment on investments in subsidiaries
and other assets (107) 14
Impact of deferred taxes (23) 31
Foreign withholding taxes 7 9
Other 5 (3)
Income tax reported in the
consolidated income statement (49) (7)
SES ANNUAL REPORT 2021118
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
EFFECT OF CHANGES IN TAX RATE
During 2021, the Dutch government decided to increase the general
corporate income tax rate from 25% to 25.8% as of 1 January 2022
and the deferred tax assets and liabilities balances have been re-
measured on this revised basis. The total impact of this re-measurement
was an income tax expense of € 3 million. The above re-measurement
was considered a change in accounting estimate in accordance with
IAS 8.
During 2021, the commune of Betzdorf hosting SES corporate head-
quarters decided to increase the municipal business tax rate from
7.5% to 9% bringing the total corporate income tax rate for Luxem-
bourg from 25.69% to 27.19% as from 1 January 2022. The deferred
tax assets and liabilities balances have been re-measured on this
basis. The total impact of this re-measurement was a tax income of
€ 8 million. The above re-measurement was considered a change in
accounting estimate in accordance with IAS 8.
FOREIGN WITHHOLDING TAX
The foreign withholding tax of € 7 million includes a provision of
€ 4 million for Indian withholding tax retained by customers and paid
to the Indian tax authorities. A final decision on Indian withholding
taxes is still pending at the level of the Supreme Court.
The remaining € 3 million relates to withholding tax retained by
customers in other jurisdictions.
INVESTMENT TAX CREDITS
In 2021, the continuing investment in the O3b mPOWER and SES-17
triggered the recognition of deferred tax assets for investment tax
credits of € 19 million (2020: € 55 million) and € 14 million (2020: € 6
million) respectively. In 2021, SES started the procurement of 19.2°
replacement satellites triggering the recognition of deferred tax
assets for investment tax credits of € 9 million (2020: € 0 million).
The remaining € 2 million of deferred tax assets for investment tax
credits was recognised in connection with other investments by Group
companies in Luxembourg.
According to Luxembourg tax law, unused investment tax credits can
be carried forward for ten years. SES believes that it is probable that
sufficient taxable profits will be available in the Luxembourg fiscal
unity in the future to use all the available investment tax credits.
IMPACT OF DEFERRED TAXES
GovSat-1 was launched in January 2018 and entered in operational
service in March 2018. A deferred tax asset for investment tax credits
of € 26 million was recognised by its owner LuxGovSat S.A. in the
same year. LuxGovSat S.A. is not part of the Luxembourg fiscal unity.
As a result of management’s analysis of the recoverability of this
deferred tax asset, an additional amount of € 11 million was reversed
during 2021 (2020: € 4 million).
On the basis of a recoverability analysis, an additional net deferred
tax asset of € 41 million was recognised in relation to prior year tax
losses in Luxembourg, Israel and Germany.
An additional deferred tax liability of € 6 million was recorded follow-
ing the transfer of the business assets of SES Satellite Leasing Ltd to
SES Astra S.A.
IMPAIRMENT ON SUBSIDIARIES AND OTHER
ASSETS
The aggregate impact of € 107 million comprises the following:
•
The impairment charge of € 903 million (2020: € 64 million)
recorded on the carrying value of subsidiary investments and other
assets held by entities in Luxembourg resulting in a positive effec-
tive tax rate (‘ETR’) impact of € 232 million (2020: € 17 million).
• The impairment charge of € 62 million taken on the carrying value
of intercompany receivables held by entities in Luxembourg result-
ing in a positive ETR impact of € 16 million.
•
The impairment charge of € 673 million (2020: nil) recorded in con-
nection with the goodwill attributed to the GEO North America
cash-generating unit >> Note 14 resulting in a negative ETR impact
of € 141 million (2020: nil).
NOTE 8 – DEFERRED INCOME TAX
The deferred tax positions included in the consolidated financial
statements can be analysed as follows:
Deferred Income Tax
€ MILLION
Deferred
tax assets
2021
Deferred
tax assets
2020
Deferred
tax liabili-
ties 2021
Deferred
tax liabili-
ties 2020
Losses carried forward 301 73 – –
Tax credits
259 227 – –
Intangible assets 23 27 (239) (219)
Tangible assets – – (160) (123)
Trade receivables 19 13 – –
Other 5 9 (39) (27)
Total deferred tax
assets/(liabilities) 607 349 (438) (369)
Offset of deferred
taxes (39) (36) 39 36
Net deferred tax
assets/(liabilities) 568 313 (399) (333)
Deferred tax assets have been offset against deferred tax liabilities
where they relate to the same tax authority and the entity concerned
has a legally enforceable right to set off current tax assets against
current tax liabilities.
SES ANNUAL REPORT 2021119
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
In 2021 the Group recognised additional deferred tax assets for tax
losses carried forward in Luxembourg for € 247 million (2020: nil). Tax
losses can be carried forward in Luxembourg for 17 years. Using the
estimated future taxable income based on the most recent business
plan information approved by the Board of Directors, the Company
has concluded that the deferred tax assets for the remaining tax
losses carried forward are recoverable (€ 281 million).
In addition to the recoverable tax losses for which the Group has
recognised deferred tax assets, the Group has further tax losses of
€ 488 million as at 31 December 2021 (31 December 2020: € 497 mil-
lion) which are available for offset against future taxable profits of the
companies in which the losses arose. € 329 million (31 December
2020: 431 million) of these tax losses were generated in the US.
Deferred tax assets have not been recognised in respect of these
losses as they cannot be used to offset taxable profits elsewhere in
the Group and they have arisen in subsidiaries which are not expected
to generate taxable profits against which they could be offset in the
foreseeable future.
No deferred income tax liabilities have been recognised for withhold-
ing tax and other taxes which would be payable on the unremitted
earnings of certain subsidiaries. Such amounts are permanently
reinvested or not subject to taxation.
The movement in deferred income tax assets and liabilities during
the year, without taking into consideration the offsetting of balances,
is as follows:
Movement in deferred Income Tax Assets
DEFERRED TAX ASSETS
Losses
carried
forward Tax credits
Intangible
assets Receivables Other Total
At 1 January 2020 71 168 30 23 10 302
(Charged)/credited to the income statement 3 60 (4) (9) 1 51
Charged directly to equity – – – – 1 1
Exchange difference
1
(2) – – (1) (2) (5)
At 31 December 2020 72 228 26 13 10 349
(Charged)/credited to the income statement 227 31 (3) 5 (5) 255
Charged directly to equity – – – – – –
Exchange difference
1
2 – – 1 – 3
At 31 December 2021 301 259 23 19 5 607
Movement in deferred Income Tax Liabilities
DEFERRED TAX LIABILITIES
Intangible
assets
Tangible
assets Other Total
At 1 January 2020 207 169 25 401
Charged/(credited) to the income statement 29 (38) 2 (7)
Exchange difference
1
(17) (8) – (25)
At 31 December 2020 219 123 27 369
Charged/(credited) to the income statement 2 31 12 45
Exchange difference
1
18 6 – 24
At 31 December 2021 239 160 39 438
1 A foreign exchange impact arises due to the translation of Group’s operations with a different functional currency than euro. This amounts to € 21 million as at 31 December 2021
(2020: € 20 million)
SES ANNUAL REPORT 2021120
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 9 – COMPONENTS OF OTHER
COMPREHENSIVE INCOME
Components of Other Comprehensive Income
€ MILLION 2021 2020
Impact of currency translation 471 (624)
Income tax effect (36) 35
Total impact of currency translation, net of tax 435 (589)
The impact of currency translation in other comprehensive income
relates to exchange gains or losses arising on the translation of the
net assets of foreign operations from their functional currency to
the euro, which is the Company’s functional and presentation
currency.
The unrealised gain in 2021 of € 471 million (2020: unrealised loss of
€ 624 million) reflects the impact on the valuation of SES’s net US
dollar assets due to the strengthening of the US dollar against the
euro from $ 1.2271 to $ 1.1326 (2020: the weakening of the US dollar
against the euro from $ 1.1234 to $ 1.2271). This effect is partially off-
set by the impact of the net investment hedge >> Note 18.
NOTE 10 – EARNINGS PER SHARE
Earnings per share is calculated by dividing the net profit for the year
attributable to ordinary shareholders of each class of shares by the
weighted average number of shares outstanding during the year as
adjusted to reflect the economic rights of each class of share. The
net profit or loss for the year attributable to ordinary shareholders
has been adjusted to include an assumed coupon, net of tax, on the
Perpetual Bonds.
For 2021, a basic earnings per share of € 0.92 per Class A share (2020:
basic loss per share of € 0.30), and € 0.37 per Class B share (2020:
basic loss per share of € 0.12) have been calculated as follows:
Profit attributable to the owners of the parent for calculating basic
earnings per share:
Profit Attributable to Owners
€ MILLION 2021 2020
Profit attributable to owners of the parent 453 (86)
Assumed coupon on perpetual bond (net of tax) (41) (49)
Total 412 (135)
Assumed coupon accruals of € 41 million (net of tax) for the year
ended 31 December 2021 (2020: € 49 million) related to the Perpet-
ual Bonds in issue have been considered for the calculation of the
basic and diluted earnings available for distribution.
The weighted average number of shares based on the capital struc-
ture of the Company as described in >> Note 20, net of own shares
held, for calculating basic earnings per share was as follows:
A- and B-shares
2021 2020
Class A shares (in million) 369.7 378.4
Class B shares (in million) 189.2 191.7
Total 558.9 570.1
Diluted earnings per share is calculated by adjusting the weighted
average number of ordinary shares outstanding to assume conversion
of all dilutive potential ordinary shares which are primarily related to
the share-based compensation plans. A calculation is done to deter-
mine the number of shares that could have been acquired at fair value
based on the monetary value of the subscription rights attached to
outstanding share options. The number of shares calculated as above
is compared with the number of shares that would have been issued
assuming the exercise of the share options and the difference, if it
results in a dilutive effect, is considered to adjust the weighted
average number of shares.
For 2021, a diluted earnings per Class A share of € 0.92 (2020: diluted
loss of € 0.30), and € 0.37 per Class B share (2020: diluted loss of
€ 0.12) have been calculated as follows:
Diluted Earnings per Share
€ MILLION 2021 2020
Profit attributable to owners of the parent 453 (86)
Assumed coupon on perpetual bond (net of tax) (41) (49)
Total 412 (135)
The weighted average number of shares, net of own shares held, for
calculating diluted earnings per share was as follows:
Weighted Average Number of Shares
2021 2020
Class A shares (in million) 372.9 381.3
Class B shares (in million) 189.2 191.7
Total 562.1 573.0
SES ANNUAL REPORT 2021121
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 11 – DIVIDENDS PAID AND PROPOSED
Dividends declared are paid net of any withholding tax (2021: € 20 million,
2020: € 20 million).
Dividends declared and paid during the year:
Dividends Declared and Paid
€ MILLION 2021 2020
Class A dividend for 2020: € 0.40
(2019: € 0.40) 153 153
Class B dividend for 2020: € 0.16
(2019: € 0.16) 31 31
Total 184 184
Dividends proposed for approval at the annual general meeting to
be held on 1 April 2022, which are not recognised as a liability as at
31 December 2021:
Dividend Proposed
€ MILLION 2022 2021
Class A dividend for 2021: € 0.50
(2020: € 0.40) 192 153
Class B dividend for 2021: € 0.20
(2020: € 0.16) 38 31
Total 230 184
NOTE 12 – PROPERTY, PLANT AND EQUIPMENT
Property, Plant and Equipment 2021
€ MILLION Land and buildings Space segment Ground Segment
Other fixtures and
fittings, tools and
equipment Total
Cost
As at 1 January 2021 278 11,091 811 229 12,409
Additions 6 – 7 3 16
Disposals (3) (1) (1) (5)
Retirements
1
(6) (850) (3) (1) (860)
Transfers from assets in course of
construction (>> Note 13) 3 – 17 41 61
Transfers from intangible assets (>> Note 14) – – 3 – 3
Impact of currency translation 11 468 38 6 523
As at 31 December 2021 289 10,709 872 277 12,147
Depreciation
As at 1 January 2021 (186) (7,321) (562) (170) (8,239)
Depreciation (15) (478) (53) (29) (575)
Impairment expense – (73) – – (73)
Impairment reversal – 22 – – 22
Disposals – – 1 1 2
Retirements
1
6 850 3 1 860
Impact of currency translation (6) (332) (29) (4) (371)
As at 31 December 2021 (201) (7,332) (640) (201) (8,374)
Net book value as at 31 December 2021 88 3,377 232 76 3,773
1 Satellites ASTRA 2B, ASTRA 1D, AMC-2, AMC-16, NSS-806 and NSS-5 were retired in 2021
SES ANNUAL REPORT 2021122
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& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Property, Plant and Equipment 2020
€ MILLION Land and buildings Space segment Ground Segment
Other fixtures and
fittings, tools and
equipment Total
Cost
As at 1 January 2020 290 12,054 834 215 13,393
Additions 5 – 8 2 15
Disposals (2) – (1) (1) (4)
Retirements
1
(6) (285) (1) (2) (294)
Transfers from assets in course of construction (>> Note 13) 3 – 15 23 41
Transfers between categories – – 1 (1) –
Impact of currency translation (12) (678) (45) (7) (742)
As at 31 December 2020 278 11,091 811 229 12,409
Depreciation
As at 1 January 2020
(178) (7,335) (536) (158) (8,207)
Depreciation (21) (527) (57) (20) (625)
Impairment expense – (229) – – (229)
Impairment reversal – 46 – – 46
Disposals – – 1 1 2
Retirements
1
6 285 1 2 294
Impact of currency translation 7 439 29 5 480
As at 31 December 2020 (186) (7,321) (562) (170) (8,239)
Net book value as at 31 December 2020 92 3,770 249 59 4,170
1 Satellites AMC-7 and ASTRA 1F were retired in 2020
SES ANNUAL REPORT 2021123
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& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
The Group’s policy in setting the useful economic life of its satellites
is to initially use the satellite design life and then, once sufficient time
has passed to allow for initial anomalies to be investigated and future
fuel projections to be stabilised, to adjust the depreciation life to take
into account factors such as the technical condition of the satellite,
its projected remaining fuel life, and replacement or redeployment
plans.
The review in 2021 resulted in revisions to the remaining useful eco-
nomic lives of three GEO satellites resulting in a net decrease in the
depreciation expense for 2021 of € 9 million. The corresponding
review in 2020 resulted in revisions to the remaining useful economic
lives of four GEO satellites and five MEO satellites resulting in a net
decrease in the depreciation expense for 2020 of € 17 million.
As at 31 December 2021, the amount of the property, plant and equip
-
ment pledged in relation to the Group’s liabilities is nil (2020: nil).
For further information related to right-of-use assets, >> Note 29.
IMPAIRMENT OF SPACE SEGMENT ASSETS
In 2021, the net impairment expense for space segment assets
recorded was € 51 million (2020: € 183 million), comprising impairment
expenses of € 73 million offset by impairment reversals of € 22 million.
The charges and reversals are the aggregation of impairment testing
procedures on specific satellites, or combinations of co-located
satellites, in the Group’s geostationary fleet.
The following table discloses the applicable amounts and discount
rates used in the impairment test for those geostationary satellites
subject to impairment expenses or reversals during the year.
Impairment expenses and reversals
€ MILLION
Carrying
value
Value
in use
Discount
rate
Impairment
expense
2021 – Expense 333 260 4.9% - 8.9% 73
2021 – Reversal 66 114 4.9% - 8.9% (22)
2021 – Net impact 51
2020 – Expense 814 585 5.8% - 7.1% 229
2020 – Reversal 140 186 5.8% - 7.1% (46)
2020 – Net impact 183
The impairment expenses and reversals recorded reflect updated
business assumptions for the satellites through to the end of their
useful economic lives. In general, these updated assumptions reflect
a combination of revised commercial developments and expectations,
updated assessments of the regulatory environment impacting
certain assets (and hence the Group’s ability to achieve the forecast
commercial exploitation), changes in the competitive environment in
which the Group operates, and certain changes in the operation of
the satellites (for example the decision to place a particular satellite
into inclined orbit, or changes to the timing thereof) or associated
ground segment infrastructure.
Specific developments, largely in the second half of 2021, in these
areas contributed to the weakening of cash flow projections for certain
satellites and contributed to the recording of the impairment expenses
noted above.
As part of standard impairment testing procedures, the Group
assesses the impact of changes in the discount rates and reductions
in EBITDA. Discount rates are simulated up to 1% below and above
the CGU’s specific rate used in the base valuation and EBITDA pro-
jections are simulated up to 5% below and above the base valuation.
In this way a matrix of valuations is generated, which reveals the
potential exposure to impairment expenses based on movements in
the valuation parameters which are within the range of outcomes
foreseeable at the valuation date.
The most recent testing showed that for this category of geostation-
ary space segment assets, then under the least favourable combina-
tion of the circumstances above (namely a 1% higher discount rate in
conjunction with a 5% lower EBITDA projection) an incremental
impairment of € 68 million would be recorded. A 1% increase in the
discount rate at a constant EBITDA level would increase satellite
impairments by € 28 million. Taken separately, a 5% decrease in
EBITDA would increase satellite impairments by € 31 million.
SES ANNUAL REPORT 2021124
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OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 13 – ASSETS IN THE COURSE OF
CONSTRUCTION
Assets in the Course of Construction 2021
€ MILLION
Land and
Buildings
Space
segment
Ground
segment
Fixtures, tools
& equipment Total
Cost and net book value as at 1 January 2021 1 1,529 90 31 1,651
Movements in 2021
Additions
1
7 360 63 9 439
Transfers to assets in use (>> Note 12) (3) – (17) (41) (61)
Transfer to intangible assets (>> Note 14) – – (10) – (10)
Transfer between categories 2 – (12) 10 –
C-band repurposing (>> Note 33)
2
– (305) (8) – (313)
Impact of currency translation – 80 1 1 82
Cost and net book value as at 31 December 2021 7 1,664 107 10 1,788
1 Additions related to O3b mPOWER, SES-17, Astra 19.2E (including € 237 million non-cash transactions)
2 C-band reimbursable space segment and ground cost (non-cash)
Assets in the Course of Construction 2020
€ MILLION
Land and
Buildings
Space
segment
Ground
segment
Fixtures, tools
& equipment Total
Cost and net book value as at 1 January 2020 1 842 60 21 924
Movements in 2020
Additions
1
– 766 69 26 861
Transfers to assets in use (>> Note 12) (3) – (15) (23) (41)
Transfer to intangible assets (>> Note 14) – – (5) (1) (6)
Transfer between categories 3 – (12) 9 –
Impact of currency translation – (79) (7) (1) (87)
Cost and net book value as at 31 December 2020 1 1,529 90 31 1,651
1 Additions related to O3b mPOWER, SES-17, C-band repurposing (including € 702 million non-cash transactions)
Borrowing costs of € 6 million (2020: € 5 million) arising from financ-
ing specifically relating to satellite procurements were capitalised
during the year and are included in additions to ‘Space segment’ in
the above table.
A weighted average effective rate of 2.92% (2020: 3.34%) was used,
representing the Group’s average weighted cost of borrowing. Exclud-
ing the impact of the loan origination costs and commitment fees the
average weighted interest rate was 2.76% (2020: 3.14%).
In connection with space segment additions in 2021, the Group
recognised € 164 million (2020: € 405 million) in respect of the O3b
mPOWER arrangement described >> Note 27, € 140 million (2020:
€ 47 million) in respect of the SES-17 construction and € 56 million
in respect of procurement of satellites in connection with Astra 19.2°E
replacement.
Due to the nature of the arrangements, these transactions are
included in the Group’s assets in the course of construction space
segment and included in ‘Payments for purchases of tangible assets’
within the consolidated statement of cash flows only to the extent
that payments were made to the suppliers.
SES ANNUAL REPORT 2021125
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SOCIAL & GOVERNANCE
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3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 14 – INTANGIBLE ASSETS
Intangible Assets 2021
€ MILLION
Orbital slot
licence
rights
(indefinite-
life) Goodwill
Orbital slot
licence
rights
(definite
life)
Other
definite life
intangibles
Internally
generated
develop-
ment costs Total
Cost
As at 1 January 2021 1,930 2,173 771 470 58 5,402
Additions – – 9 – 37 46
Retirement – – (567)
1
(70) – (637)
Transfers from assets
in course of construction – – – 49 (49) –
Transfers between categories 4 – – (4) – –
Transfers to property, plant and
equipment (>> Note 12) – – – (3) – (3)
Transfers from assets under
constructions, property, plant
and equipment (>> Note 13) – – – 10 – 10
Impact of currency translation 147 203 – 17 – 367
As at 31 December 2021 2,081 2,376 213 469 46 5,185
Amortisation
As at 1 January 2021 (14) (147) (630) (419) – (1,210)
Amortisation – – (38) (57) – (95)
Impairment – (673) – – – (673)
Retirement – – 567
1
70 – 637
Impact of currency translation (2) (36) – (16) – (54)
As at 31 December 2021 (16) (856) (101) (422) – (1,395)
Net book value as at
31 December 2021 2,065 1,520 112 47 46 3,790
Intangible Assets 2020
€ MILLION
Orbital slot
licence
rights
(indefinite-
life) Goodwill
Orbital slot
licence
rights
(definite
life)
Other
definite life
intangibles
Internally
generated
develop-
ment costs Total
Cost
As at 1 January 2020 2,095 2,398 776 458 39 5,766
Additions – – – 2 45 47
Retirement – – – (6) – (6)
Transfers from assets
in course of construction – – – 24 (24) –
Transfers from assets under
constructions, property, plant
and equipment (>> Note 13) – – – 7 (1) 6
Impact of currency translation (165) (225) (5) (15) (1) (411)
As at 31 December 2020 1,930 2,173 771 470 58 5,402
Amortisation
As at 1 January 2020 – (134) (587) (360) – (1,081)
Amortisation – – (44) (51) – (95)
Impairment (14) (51) – (29) – (94)
Retirement – – – 6 – 6
Impact of currency translation – 38 1 15 – 54
As at 31 December 2020 (14) (147) (630) (419) – (1,210)
Net book value as at
31 December 2020 1,916 2,026 141 51 58 4,192
1 Concession agreement with Luxembourg government 2001 to 2021
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INDEFINITE-LIFE INTANGIBLE ASSETS
The Group’s indefinite-life intangible assets comprise goodwill and
orbital slot licence rights.
Impairment testing procedures are performed annually, or whenever
events or changes in circumstances indicate that the carrying amount
of such assets may not be recoverable. The annual impairment tests
are performed as of 31 October each year. The recoverable amounts
are determined based on a value in use calculation >> Note 2 using
the most recent business plan information approved by the Board of
Directors, which covers a period of five years.
The calculations of value in use are most sensitive to:
1) Movements in the underlying business plan
assumptions
Business plans are drawn up annually and provide an assessment
of the expected developments for a five-year period beyond the
end of the year when the plan is drawn up. These business plans
reflect both the most up-to-date assumptions concerning the
CGU’s markets and also developments and trends in the busi-
ness of the CGU. For the provision of satellite capacity these will
particularly take into account the following factors:
•
the expected developments in transponder fill rates, including
the impact of replacement capacity;
•
any changes in the expected capital expenditure cycle, for exam-
ple due to the technical degradation of a satellite or the need for
replacement capacities; and
•
any changes in satellite procurement, launch or cost assump-
tions, including launch schedule.
2) Changes in discount rates
Discount rates reflect management’s estimate of the risks spe-
cific to each CGU. Management uses a pre-tax weighted average
cost of capital as discount rate for each CGU. This reflects mar-
ket interest rates of twenty-year bonds in the market concerned,
the capital structure of businesses in the Group’s business sector,
and other factors, as necessary, applied specifically to the CGU
concerned.
3) Changes in perpetuity growth rates assumptions
Growth rate assumptions used to extrapolate cash flows beyond
the business planning period are based on the commercial expe-
rience relating to the CGUs concerned and the expectations for
developments in the markets which they serve.
REVISION TO DEFINITION OF CASH-GENERATING
UNITS FOR INTANGIBLE ASSETS
With effect from 1 January 2021 the Company has revised the identi-
fication of the cash-generating units which are applied in the impair-
ment testing of both goodwill and orbital slot rights. These changes,
and the rationale for each are as set out below:
1) Discontinuation of ‘MX1’ as a separate cash-generat-
ing unit for goodwill impairment testing
As noted in the Group’s 2020 consolidated financial statements,
the goodwill for this cash-generating unit has been fully written
off and hence no further impairment exposure remains. With
effect from January 2021 the tangible fixed assets and working
capital of MX1 have been integrated into the Group’s wider Video
business.
2) Disaggregation of current ‘SES GEO operations’ cash
generating unit
The gross goodwill as at 31 December 2021 of € 2,376 million
derives primarily from the acquisition of two significant GEO
businesses: GE Americom in 2001 and New Skies Satellites in
2006.
Since 2012, and following on from the integration of these busi-
nesses into a single operational unit alongside the more
Europe-centric SES ASTRA operations, the Group’s approach to
segmental reporting moved away from the former presentation
of two GEO-related segments ‘ASTRA’ and ‘World Skies’ (being
broadly the legacy GE Americom and New Skies Satellites
business combined) to a single operating segment defined as
‘the provision of satellite-based data transmission capacity, and
ancillary services to customers around the world’.
From 2013 this integrated model was also adopted in the identi-
fication of cash-generating units for the purpose of goodwill
impairment testing for GEO operations, with the more regionally
derived components of goodwill arising in the purchase price
allocation exercises for those two GEO acquisitions being
grouped and monitored at the level of a single group of cash-gen-
erating units; an approach which was maintained for the eight
years between 2013 and 2020.
Beginning in 2021, management has disaggregated this single
cash-generating unit to revert to a regionally based reporting
and monitoring of goodwill, realigning it with the approach taken
for the impairment testing of orbital slot rights. This reflects the
developments in the business environment of the Group,
triggered by the increasing demand from market participants in
various business areas (primarily telecommunications compa-
nies) for bandwidth to support the provision of data connectivity
services.
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These developments mean that there are increasingly two
economic paths available to the Group in commercialising the
valuable portfolio of orbital slot rights it has generated over many
years, including through the two GEO business acquisitions
noted above:
•
utilising these rights in the provision of services on its own
satellite fleet; and
•
generating economic value through entering into transactions
with third parties to make these rights available to them in return
for an appropriate financial compensation.
A specific example is the ongoing C-band repurposing project
in the U.S. following the adoption by the Federal Communications
Commission of its Report and Order and Order of Proposed
Modification to clear a 300 MHz band of C-band downlink
spectrum between 3,700 and 4,000 MHz by December 2025
>> Note 33.
Since the opportunities, and hence potential cash flows, arising
from this expanding area of commercialisation of orbital slot
rights other than through conventional on-fleet operations, are
by their nature arrangements with regional regulatory authorities
and market participants, and since the linkage to the orbital slot
rights is so strong, it seems appropriate to management to
re-align the approach to impairment testing by looking at both
areas using on a regional basis and disaggregating the cash-
generating units again for the purpose of goodwill testing.
The goodwill has been allocated between the three cash-gener-
ating units (as defined below) based on the assets acquired in
the above acquisitions, with materially all the assets acquired in
the GE Americom acquisition being allocated to ‘North America’
and materially all the assets acquired in the New Skies Satellites
acquisition being allocated to ‘International’. See the goodwill
table below for the allocation of goodwill to the new CGUs.
3) Reduction in regional cash-generating units for impair-
ment testing of orbital slot rights from six to three
Three regions (‘Europe’, ‘North America’ and ‘International’) have
been defined for impairment testing procedures for both good-
will and orbital slot rights, compared to the six regions (‘Europe’,
‘US’, ‘Canada’, ‘Mexico’, ‘Brazil’ and ‘International’) used between
2012 and 2020 for procedures on orbital slot rights. Whilst there
is no change to the ‘Europe’ region, the cash-generating units
‘US’, ‘Canada’ and ‘Mexico’ have been grouped into a new ‘North
America’ unit, and ‘Brazil’ has been grouped with ‘International’.
In the case of ‘North America’ this aggregation reflects the cur-
rent inter-operability of spacecraft and orbital locations which
can be used to serve customers in the U.S., Canada and Mexico,
as well as the increasing interdependency of the contractual
arrangements for significant customers in those markets which
mean that the associated cash flows can no longer be seen as
largely independent of each other.
Concerning ‘International’ then this aggregation again reflects
the increasing interdependency of cash flows between regions
with an increasing use of Brazilian spectrum by assets, such as
SES-10 and the recently launched SES-17 satellite, which are also
serving ‘International’ customers, and the fact that the Group is
now also serving the Brazilian market from orbital slots other
than those allocated to the unit.
As the Group extends its global connectivity offering integrating
both GEO and MEO capacity, the level of interdependency of
cash flows between the GEO International and MEO is expected
to increase.
The Group’s business plan is approved by the Board of Directors
based on consolidated data. The consolidated data is based on
separate data prepared for each legal entity of the Group
>> Note 36. To prepare business plans for the regional CGUs, the
following assumptions are made:
• GEO revenue from satellites is allocated to the GEO region pri-
marily covered by the satellite. Non-satellite revenue is included
in each CGU based on the legal entity expected to generate the
revenue. MEO revenue, including GEO revenue expected to be
used servicing primarily MEO contracts, is included in MEO.
• Operating expenses are allocated based on the underlying legal
entity expected to incur the expense. Reallocations were
performed when costs in one CGU clearly support the business
of a different CGU.
•
Intercompany transactions between CGUs included in the
business plans of the individual legal entities were included,
except where the above allocation methodologies made them no
longer relevant.
•
The Accelerated Relocation Payments related to the C-band
repurposing >> Note 33 were allocated between the GEO North
America and GEO International CGUs based on the Group’s inter-
nal allocation of the proceeds, and considering the likely alloca-
tion agreed with the relevant regulatory authorities.
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DISCOUNT RATES APPLIED
The pre-tax discount rates for each CGU are presented below:
Pre-Tax discount Rates for CGU
2021 2020
GEO Europe 6.40% –
GEO North America 10.18% –
GEO International 8.14% –
GEO – 8.04%
MEO 8.04% 7.97%
MX1 – 8.43%
These discount rates were computed using market interest rates and
commercial spreads, the capital structure of businesses in the Group’s
business sector, and the specific risk profile of the businesses con-
cerned. Generally, lower market risk premiums offset an increase in
risk-free rates, especially on rates that are calculated with USD-based
inputs.
PERPETUAL GROWTH RATE (‘PGR’) ASSUMPTIONS
As a result of GEO disaggregation mentioned above, separate GEO
terminal growth rates by region were calculated for the first time. The
terminal growth rate used in the valuations is -0.4% for GEO Europe,
-4.5% for GEO North America, and +3.0% for GEO International. In
2020, a +0.5% terminal growth rate was used for GEO. The terminal
growth rate used for MEO was +3.0% (2020: +2.0%).
These rates reflect the most recent long-term planning assumptions
approved by the Board of Directors and can be supported by refer-
ence to the trading performance over a longer period and incorporate
also projected growth rates for wide-beam and high-throughput
satellites markets from external data sources. A cap has been applied
to the PGRs in the case of GEO International and MEO. On a weighted-
average basis, the terminal growth rate used for the GEO CGUs is
comparable with the prior-year rate used for GEO. For MEO, the higher
rate reflects higher the projected growth expectations approaching
the end of the business planning period, which, again, is supported
by external data sources.
IMPAIRMENT CHARGES RECORDED FOR 2021
1) Goodwill
As a result of the impairment tests conducted as of 31 December 2021,
an impairment expense of € 673 million was recorded on GEO North
America. The impairment is mainly driven by the impact of the disag-
gregation of the CGUs with the lower resulting attributable perpetual
growth rate and, to a large extent, the recognition and receipt of the
Phase I Accelerated Relocation Payment in 2021 >> Note 33.
No impairment expense was recorded on the carrying value of good-
will in GEO Europe, GEO International, or MEO.
•
For GEO Europe, which mainly represents the organically grown
Astra business, no impairment was necessary due to steady cash
flows, low discount rates, and a minimal goodwill amount (see
below).
•
For GEO International, no impairment was necessary. This CGU
encompasses most of the Group’s GEO high-throughput satellites,
which are expected to contribute to future revenue growth,
although part of the value in use is also attributable to future pro-
ceeds receivable in the framework of the FCC Order as set out in
more detail >> Note 33 below.
• For MEO, the valuation has increased due mainly to the increase in
the PGR.
For all three CGUs, the updated business plan approved by the SES
Board of Directors in December 2021 already reflects the impact of
COVID-19.
Arising from the impairment reviews above, the Group’s remaining
goodwill has a net book value as at 31 December 2021 and 2020 by
CGU as presented below:
Goodwill: Net Book Value
€ MILLION 2021 2020
GEO Europe 19 19
GEO North America 1,120 1,657
GEO International 224 207
MEO 152 138
Other (SES GS) 5 5
Total
1,520 2,026
The decrease in GEO North America reflects the € 673 million impair-
ment mentioned above.
As part of standard impairment testing procedures, the Group
assesses the impact of changes in the discount rates and growth
assumptions of the valuation surplus, or deficit as the case may be.
Both discount rates and terminal values are simulated up to 1% below
and above the specific rate used in the base valuation. In this way, a
matrix of valuations is generated which reveals the potential exposure
to impairment expenses for each CGU based on movements in the
valuation parameters which are within the range of outcomes fore-
seeable at the valuation date.
The most recent testing showed that:
• Neither GEO Europe or GEO International would record an impair-
ment applying the most adverse combination of developments
(a 1% increase in discount rates and 1% decrease in the perpetual
growth rate).
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• For GEO North America, the recorded impairment would increase
by € 13 million in the case of a 1% decrease in the perpetual growth
rate, by € 54 million in the case of a 1% increase in the discount
rate, and by € 65 million in the case of both a 1% decrease in the
perpetual growth rate and a 1% increase in the discount rate.
• For MEO, whilst an impairment would not be required in the case
of a 1% decrease in the perpetual growth rate, it would require an
impairment of € 49 million in the case of a 1% increase in the dis-
count rate and of € 329 million were there to be a combination of
a 1% higher discount rate and a 1% lower perpetual growth rate.
Taken separately from changes in discount and perpetuity growth rates,
a 5% reduction in EBITDA would not lead to an impairment expense
in the GEO Europe, GEO International, or MEO CGUs. The recorded
impairment in GEO North America would increase by € 44 million.
2) Orbital slot licence rights
The rights conveyed by orbital slot licences in different jurisdictions
can have varying characteristics that make them separate and dis-
tinct from the orbital slot licence rights in other jurisdictions. The MEO
orbital rights are not separable and do not generate separate cash
flows, and thus are considered a single CGU, which is tested for impair-
ment together with the related corresponding goodwill and the MEO
satellites constellation.
The pre-tax discount rates for each CGU are presented below:
Orbital Slots Licence Rights:
Pre-Tax discount Rates for CGU
2021 2020
GEO Europe 7.40% 9.04%
GEO North America 11.18% 9.15%
GEO International 9.14% 9.15%
MEO 8.04% 7.97%
Similar to the pre-tax discount rates used for goodwill testing, these
rates were selected to reflect market interest rates and commercial
spreads; the capital structure of businesses in the Group’s business
sector; and the specific risk profile of the businesses concerned. The
terminal growth rates used in the valuations are identical to those
used in goodwill testing. The Group did not record any impairment
expenses related to orbital slot licence rights for the year ending
31 December 2021 (2020: € 14 million).
The orbital slot license rights have a net book value as at 31 Decem-
ber 2021 and 2020 by CGU as presented below:
Orbital Slot Licence Rights: Net Book Value
€ MILLION 2021 2020
Europe 168 146
North America (including U.S., Canada,
and Mexico in 2020) 325 300
International 447 432
MEO 1,125 1,038
Total 2,065 1,916
As part of standard impairment testing procedures, as with goodwill,
the Group assesses the impact of changes in the discount rates and
growth assumptions of the valuation surplus, or deficit as the case
may be. Both discount rates and terminal values are simulated up to
1% below and above the CGU’s specific rate used in the base valua-
tion. In this way a matrix of valuations is generated which reveals the
potential exposure to impairment expenses for each CGU based on
movements in the valuation parameters which are within the range
of outcomes foreseeable at the valuation date.
For orbital slot licence rights, the least favourable case – a combination
of lower terminal growth rates and higher discount rates – would not
lead to any impairment expenses of any orbital slot licence right CGU.
DEFINITE-LIFE INTANGIBLE ASSETS
The definite-life intangible assets as at 31 December 2021 have a net
book value by country as presented below:
Definite Life Intangible Assets 2021
€ MILLION 2021
Orbital slot
licence
rights Other
Luxembourg 105 25
Israel – 2
Brazil 7 –
Other – 20
Total 112 47
The definite-life intangible assets as at 31 December 2020 have a net
book value by country as presented below:
Definite Life Intangible Assets 2020
€ MILLION 2020
Orbital slot
licence
rights Other
Luxembourg 130 24
Israel – 2
Brazil 7 –
Other 4 25
Total 141 51
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ADDITIONAL
INFORMATION
The Group’s primary definite life intangible asset has been the agree-
ment concluded by SES ASTRA with the Luxembourg government in
relation to the usage of Luxembourg frequencies in the orbital posi-
tions of the geostationary arc from 45˚ West to 50˚ East for the period
from 1 January 2001 to 31 December 2021. Given the finite nature of
this agreement, these usage rights – valued at € 550 million at the
date of acquisition – were amortised on a straight-line basis over the
21-year term of the agreement and were retired as of 31 December
2021.
In November 2019, SES and the Luxembourg government reached an
agreement to renew SES’s concession to operate satellites operating
under Luxembourg’s jurisdiction for 20 years, effective from January
2022 when the current concession expires, with an annual fee of
€ 1 million payable from 2025 onwards. Under the agreement, and
starting from 2022, SES will also contribute a maximum of € 7 million
per year into a space sector fund.
The Group also holds orbital slot licence rights in Brazil, which were
awarded to a Group subsidiary at auction in 2014 for a 15-year term.
These rights are being amortised over a 30-year period, reflecting the
Group’s ability to renew the rights once in 2029 at a minimal cost,
assuming they are being utilised.
As at 31 December 2021, the amount of the intangible assets pledged
in relation to the Group’s liabilities is nil (2020: nil).
NOTE 15 – ASSETS AND LIABILITIES RELATED
TO CONTRACTS WITH CUSTOMERS
The Group has recognised the following assets and liabilities related
to contracts with customers:
Assets and Liabilities Related to
Contracts With Customers
€ MILLION 2021 2020
Current contract assets
Trade receivables 357 393
Provision for trade receivables (93) (93)
Trade receivables, net of provisions 264 300
Unbilled accrued revenue 138 127
Provision for unbilled accrued revenue (4) (2)
Unbilled accrued revenue, net of provisions 134 125
Deferred customer contract costs 3 10
401 435
Non-current contract assets
Unbilled accrued revenue 254 275
Provision for unbilled accrued revenue (9) (7)
Unbilled accrued revenue, net of provisions 245 268
Deferred customer contract costs 9 9
254 277
Current contract liabilities
Deferred income 404 454
Non-current contract liabilities
Deferred income 314 296
The following table shows the movement in deferred income recog-
nised by the Group:
Movement in Deferred Income 2021
€ MILLION Non-current Current
As at 1 January 2021 296 454
Revenue recognised during the year – (1,132)
New billings – 1,092
Other movements* 8 (20)
Impact of currency translation 10 10
As at 31 December 2021 314 404
* Other movements include reclassifications (between current and non-current,
upfront and deferred, as well as against trade receivables)
Movement in Deferred Income 2020
€ MILLION Non-current Current
As at 1 January 2020 317 467
Revenue recognised during the year – (1,184)
New billings – 1,236
Other movements* (12) (50)
Impact of currency translation (9) (15)
As at 31 December 2020 296 454
* Other movements include reclassifications (between current and non-current,
upfront and deferred, as well as against trade receivables)
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NOTE 16 – TRADE AND OTHER RECEIVABLES
Trade and Other Receivables
€ MILLION 2021 2020
Trade receivables, net of provisions 264 300
Unbilled accrued revenue, net of provisions 379 393
Other receivables 1,348 63
Total trade and other receivables 1,991 756
Of which:
Non-current 245 268
Current 1,746 488
Unbilled accrued revenue represents revenue recognised, but not
billed, under long-term customer contracts. Billing will occur based
on the terms of the contracts. The non-current balance represents
entirely unbilled accrued revenue. Other receivables include € 1,273
million (2020: € 21 million) to be received as part of the C-band repur-
posing project >> Note 33.
An amount of € 27 million (2020: € 35 million) was expensed in 2021
reflecting an increase in the impairment of trade and other receiva-
bles. This amount is recorded in ‘Other operating expenses’. As at
31 December 2021, trade and other receivables with a nominal amount
of € 106 million (2020: € 102 million) were impaired. Movements in
the provision for the impairment of trade and other receivables were
as follows:
Movement in the Provision for the Impairment
of Trade and other Receivables
€ MILLION 2021 2020
As at 1 January 102 113
Increase in provision 43 77
Reversals of provision (16) (42)
Utilised (32) (39)
Other movements 3
Impact of currency translation 6 (7)
As at 31 December 106 102
NOTE 17 – FINANCIAL INSTRUMENTS
FAIR VALUE ESTIMATION AND HIERARCHY
The Group uses the following hierarchy levels for determining the fair
value of financial instruments by valuation technique:
•
Level 1 – Quoted prices in active markets for identical assets or
liabilities;
•
Level 2 – Other techniques for which all inputs which have a
significant effect on the recorded fair value are observable either
directly or indirectly;
•
Level 3 – Techniques which use inputs which have a significant
effect on the recorded fair value that are not based on observable
market data.
The fair value of investments that are actively traded in organised
financial markets is determined by reference to quoted market bid
prices at the close of business on the reporting date. For investments
where there is no active market, fair value is determined using
valuation techniques. Such techniques include using recent arm’s-
length market transactions; reference to the current market value of
another instrument, which is substantially the same; discounted cash
flow analysis and option pricing models.
In line with 2020, as at 31 December 2021, the Group does not have
any financial derivatives outstanding.
FAIR VALUES
The fair value of borrowings has been calculated with the quoted
market prices except for COFACE, the LuxGovSat Fixed Term Loan
Facility and the floating tranche of the Schuldschein Loan for which
the discounted expected future cash flows at prevailing interest rates
has been used. The fair value of foreign currency contracts is calcu-
lated by reference to current forward exchange rates for contracts
with similar maturity profiles.
All borrowings are measured at amortised cost. Financial assets and
other financial liabilities measured at amortised cost, have a fair value
that approximates their carrying amount.
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ADDITIONAL
INFORMATION
Set out below is a comparison by category of carrying amounts and
fair values of all the Group’s financial instruments that are carried in
the financial statements.
As at 31 December 2021 – Fair Values
Carried at
amortised cost
Carried at
fair value Total
€ MILLION
Fair value
hierarchy
Carrying
amount
Fair
value
Carrying
amount
Balance
Sheet
As at 31 December 2021
Financial assets
Non-current financial assets:
Other financial assets 2 26 26 – 26
Trade and other receivables 245 245 – 245
Total non-current financial assets 271 271 – 271
Current financial assets:
Trade and other receivables 1,746 1,746 – 1,746
Cash and cash equivalents 1,049 1,049 – 1,049
Total current financial assets 2,795 2,795 – 2,795
Financial liabilities
Borrowings:
At floating rates:
Syndicated loan 2019* 2 – – – –
COFACE 2 40 40 – 40
German Bond 2024 (€ 150 million), non-listed 2 150 152 – 150
At fixed rates:
US Bond 2023 ($ 750 million) 2 662 682 – 662
German Bond 2025 (€ 250 million), non-listed 2 250 260 – 250
Eurobond 2026 (€ 650 million) 2 654 680 – 654
As at 31 December 2021 – Fair Values
Carried at
amortised cost
Carried at
fair value Total
€ MILLION
Fair value
hierarchy
Carrying
amount
Fair
value
Carrying
amount
Balance
Sheet
Euro Private Placement 2027 (€ 140 million)
under EMTN 2 140 160 – 140
Eurobond 2027 (€ 500 million) 2 497 500 – 497
Eurobond 2028 (€ 400 million) 2 395 417 – 395
Fixed Term Loan Facility (LuxGovSat) 2 99 115 99
German Bond 2032 (€ 50 million), non-listed 2 50 60 – 50
US Bond 2043 ($ 250 million) 2 214 246 – 214
US Bond 2044 ($ 500 million) 2 430 493 – 430
Total borrowings 3,581 3,805 3,581
Non-current financial liabilities: 4,101 4,323 – 4,101
Non-current borrowings 3,524 3,746 – 3,524
Lease liabilities 22 22 – 22
Fixed assets suppliers 472 472 – 472
Other long-term liabilities 83 83 – 83
Current financial liabilities: 1,914 1,916 – 1,914
Current borrowings 57 59 – 57
Lease liabilities 11 11 – 11
Fixed assets suppliers 1,554 1,554 – 1,554
Trade and other payables 292 292 – 292
* As at 31 December 2021 no amount has been drawn down under this facility. As a consequence, the remaining balance of loan orig-
ination cost of the Syndicated Loan has been disclosed under prepaid expenses for an amount of € 2.2 million.
SES ANNUAL REPORT 2021133
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
As at 31 December 2020 – Fair Values
Carried at
amortised cost
Carried at
fair value Total
€ MILLION
Fair value
hierarchy
Carrying
amount
Fair
value
Carrying
amount
Balance
Sheet
As at 31 December 2020
Financial assets
Non-current financial assets:
Other financial assets 14 14 – 14
Trade and other receivables 268 268 – 268
Total non-current financial assets 282 282 – 282
Current financial assets:
Trade and other receivables 488 488 – 488
Cash and cash equivalents 1,162 1,162 – 1,162
Total current financial assets 1,650 1,650 – 1,650
Financial liabilities
Borrowings:
At floating rates:
Syndicated loan 2019* 2 – – – –
COFACE 2 81 81 – 81
German Bond 2024 (€ 150 million), non-listed 2 150 152 – 150
At fixed rates:
Eurobond 2021 (€ 650 million) 2 555 560 – 555
US Bond 2023 ($ 750 million) 2 610 648 – 610
German Bond 2025 (€ 250 million), non-listed 2 249 266 – 249
Eurobond 2026 (€ 500 million) 2 496 529 – 496
As at 31 December 2020 – Fair Values
Carried at
amortised cost
Carried at
fair value Total
€ MILLION
Fair value
hierarchy
Carrying
amount
Fair
value
Carrying
amount
Balance
Sheet
Euro Private Placement 2027 (€ 140 million)
under EMTN 2 140 167 – 140
Eurobond 2027 (€ 500 million) 2 497 508 – 497
Eurobond 2028 (€ 400 million) 2 395 426 – 395
Fixed Term Loan Facility (LuxGovSat) 2 115 139 115
German Bond 2032 (€ 50 million), non-listed 2 50 63 – 50
US Bond 2043 ($ 250 million) 2 197 211 – 197
US Bond 2044 ($ 500 million) 2 395 429 – 395
Total borrowings 3,930 4,179 3,930
Non-current financial liabilities: 4,779 5,020 – 4,779
Non-current borrowings 3,317 3,558 – 3,317
Lease liabilities 25 25 – 25
Fixed assets suppliers 1,310 1,310 – 1,310
Other long-term liabilities 127 127 – 127
Current financial liabilities: 992 1,000 – 992
Current borrowings 613 621 – 613
Lease liabilities 12 12 – 12
Fixed assets suppliers 67 67 – 67
Trade and other payables 300 300 – 300
* As at 31 December 2020 no amount has been drawn down under this facility. As a consequence, the remaining balance of loan
origination cost of the Syndicated Loan has been disclosed under prepaid expenses for an amount of € 3 million.
SES ANNUAL REPORT 2021134
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 18 – FINANCIAL RISK MANAGEMENT
OBJECTIVES AND POLICIES
The Group’s financial instruments, other than derivatives, comprise:
a syndicated loan, Eurobonds, US dollar bonds (144A), a Euro-domi-
nated Private Placement, German Bonds (‘Schuldschein’), drawings
under Coface and under a committed credit facility for specified
satellites under construction, cash and short-term deposits.
The main purpose of the debt instruments is to raise funds to finance
the Group’s day-to-day operations, as well as for other general
business purposes. The Group has various other financial assets and
liabilities such as trade receivables and trade payables, which arise
directly from its operations.
The main risks arising from the Group’s financial instruments are
liquidity risks, foreign currency risks, interest rate risks and credit
risks. The general policies are periodically reviewed and approved by
the board.
LIQUIDITY RISK
The Group’s objective is to efficiently use cash generated to maintain
borrowings at an appropriate level. In case of liquidity needs, the
Group can call on uncommitted loans, commercial paper programs
and a committed syndicated loan. In addition, if deemed appropriate
based on prevailing market conditions, the Group can access addi-
tional funds through the European Medium-Term Note programme.
The Group’s debt maturity profile is tailored to allow the Company
and its subsidiaries to cover repayment obligations as they fall due.
The Group operates a centralised treasury function which manages,
amongst others, the liquidity of the Group to optimise the funding
costs. This is supported by a daily cash pooling mechanism.
Liquidity is monitored regularly through a review of cash balances,
the drawn and issued amounts and the availability of additional fund-
ing under committed credit lines, the two commercial paper pro-
grammes and the EMTN Programme (€ 5,010 million as at 31 Decem-
ber 2021 and € 4,260 million as at 31 December 2020 – more details
in >> Note 23).
The table below summarises the projected contractual undiscounted
cash flows based on the maturity profile as at 31 December 2021 and
2020.
Projected Contractual Undiscounted Cash Flows based on Maturity Profile as at 31 December 2021
€ MILLION Within 1 year Between 1 and 5 years After 5 years Total
As at 31 December 2021:
Borrowings 57 1,778 1,768 3,603
Future interest commitments 98 295 641 1,034
Trade and other payables
292 – – 292
Other long-term liabilities – 83 – 83
Lease liabilities 12 19 8 39
Fixed assets suppliers 472 1,554 – 2,026
Total maturity profile
931 3,729 2,417 7,077
As at 31 December 2020:
Borrowings 613 1,117 2,234 3,964
Future interest commitments 119 305 656 1,080
Trade and other payables 300 – – 300
Other long–term liabilities – 127 – 127
Lease liabilities 13 26 4 43
Fixed assets suppliers 67 1,310 – 1,377
Total maturity profile 1,112 2,885 2,894 6,891
SES ANNUAL REPORT 2021135
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
FOREIGN CURRENCY RISK
SES is active in markets outside the Eurozone, with business
operations in many locations throughout the world. Consequently,
SES uses certain financial instruments to manage its foreign currency
exposure. Derivative financial instruments are used mainly to reduce
the Group’s exposure to market risks resulting from fluctuations in
foreign exchange rates by creating offsetting exposures. SES is not
a party to leveraged derivatives and, as a matter of policy, does not
use derivative financial instruments for speculative purposes.
The Group has significant foreign operations whose functional cur-
rency is not the euro. The primary currency exposure in terms of for-
eign operations is the US dollar and the Group has designated certain
US dollar-denominated debt as net investment hedges of these oper-
ations. The Group has a corresponding exposure in the consolidated
income statement, excluding the impacts of C-band repurposing, of
50.8% (2020: 51.1%) of the Group’s revenue and 52.5% (2020: 56.0%)
of its operating expenses being denominated in US dollars. The Group
does not enter into derivative instruments to hedge these currency
exposures.
The Group may enter into forward currency contracts to eliminate or
reduce the currency exposure arising from individual capital expend-
iture projects, such as satellite procurements, tailoring the maturities
to each milestone payment to maximise effectiveness. Depending on
the functional currency of the entity with the capital expenditure com-
mitment, the foreign currency risk might be in euro or in the US dol-
lar. The forward contracts are in the same currency as the hedged
item and can cover up to 100% of the total value of the contract. It is
the Group’s policy not to enter into forward contracts until a firm com-
mitment is in place.
Hedge of net investment in foreign operations
As at 31 December 2021 and 2020, certain borrowings denominated
in US dollars were designated as hedges of the net investments in
SES Global Americas Inc. and its subsidiaries (‘SES Americas’), SES
Holdings (Netherlands) BV and its subsidiaries (‘SES Netherlands’),
SES Satellite Leasing Limited and MX1 Ltd to hedge the Group’s expo-
sure to foreign exchange risk on these investments.
As at 31 December 2021, all designated net investment hedges were
assessed to be highly effective and a total loss of € 76 million, stated
net of tax of € 26 million is included as part of other comprehensive
income for the period (2020: gain of € 84 million, stated net of tax of
€ 29 million).
The following table sets out the hedged portion of $ statement of
financial position exposure as at 31 December:
Hedged Portions of $ Statement
of Financial Position Exposure
$ MILLION 2021 2020
$ statement of financial position exposure:
SES Americas 2,359 2,729
SES Netherlands 4,617 4,733
SES Satellite Leasing Limited, Isle of Man – 984
MX1 Ltd, Israel 37 47
Total 7,013 8,493
Hedged with:
US Bonds 1,500 1,500
Total 1,500 1,500
Hedged proportion 21% 18%
The following table demonstrates the sensitivity to a +/- 20% change
in the US dollar exchange rate on the nominal amount of the Group’s
US dollar net investment, with all other variables held constant. All
value changes are eligible to be recorded in other comprehensive
income with no impact on profit and loss.
Sensitivity to a +/– 20% change in
US Dollar Exchange Rate 2021
31 December 2021
Amount
in $
million
Amount in
€ million
at closing
rate of
1.1326
Amount in
€ million
at rate of
1.36
Amount in
€ million
at rate of
0.91
$ statement of
financial position
exposure:
SES Americas 2,359 2,083 1,735 2,592
SES Netherlands 4,617 4,076 3,395 5,074
SES Satellite Leasing
Limited – – – –
MX1 Ltd, Israel 37 33 27 41
Total 7,013 6,192 5,157 7,707
Hedged with:
US Bonds 1,500 1,324 1,103 1,648
Other external
borrowings – – – –
Total 1,500 1,324 1,103 1,648
Hedged proportion 21%
Absolute difference
without hedging (1,035) 1,515
Absolute difference
with hedging (814) 1,191
SES ANNUAL REPORT 2021136
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Sensitivity to a +/– 20% change in
US Dollar Exchange Rate 2020
31 December 2020
Amount
in $
million
Amount in
€ million
at closing
rate of
1.2271
Amount in
€ million
at rate of
1.47
Amount in
€ million
at rate of
0.98
$ statement of
financial position
exposure:
SES Americas 2,729 2,224 1,856 2,785
SES Netherlands 4,733 3,857 3,220 4,829
SES Satellite Leasing
Limited 984 802 669 1,004
MX1 Ltd, Israel 47 38 32 48
Total 8,493 6,921 5,777 8,666
Hedged with:
US Bonds 1,500 1,222 1,020 1,531
Other external
borrowings – – – –
Total 1,500 1,222 1,020 1,531
Hedged proportion 18%
Absolute difference
without hedging (1,144) 1,745
Absolute difference
with hedging (942) 1,437
INTEREST RATE RISK
The Group’s exposure to market interest rate risk relates primarily to
the Group’s debt portion at floating rates. In order to mitigate this risk,
the Group is generally seeking to contract as much as possible of its
debt outstanding at fixed interest rates, and is carefully monitoring
the evolution of market conditions, adjusting the mix between fixed
and floating rate debt if necessary. To mitigate the Group’s interest
rate risk in connection with near-term debt refinancing needs, the
Group may from time to time enter into interest rate hedges through
forward contracts denominated in € and $.
As per 31 December 2021 and 31 December 2020, the Group had no
interest rate hedges outstanding.
The table below summarises the split of the carrying amount of the
Group’s debt between fixed and floating rate.
Split of the Nominal Amount of the Group’s Debt
between Fixed and Floating Rate
€ MILLION
At fixed
rates
At floating
rates Total
Borrowings at 31 December 2021 3,391 190 3,581
Borrowings at 31 December 2020 3,699 231 3,930
In 2021, the Group repaid a maturing Eurobond 2021 of € 556 million,
€ 41 million related to Coface instalments and € 16 million of the Lux-
GovSat Facility.
The following table demonstrates the sensitivity of the Group’s pre-
tax income to reasonably possible changes in interest rates affecting
the interest charged on the floating rate borrowings. All other varia-
bles are held constant. The Group believes that a reasonably possible
development in the Eurozone interest rates would be an increase of
nil basis points or an increase of 12 basis points (2020: decrease of
9 basis points).
Euro interest rates
€ MILLION
Floating
rate bor-
rowings
Increase in
rates
Pre-tax
impact
Decrease in
rates
Pre-tax
impact
Borrowings at 31 December 2021 190 0.4 –
Borrowings at 31 December 2020 231 – 0.2
CREDIT RISK
Risk management
The Group has the following types of financial assets that are subject
to the expected credit loss model: trade receivables, unbilled accrued
revenue, and C-band repurposing receivables.
It is the Group’s policy that all customers who wish to trade on credit
terms are subject to credit verification procedures. To measure
expected credit losses on trade receivables and unbilled accrued
revenue, they are grouped based on shared credit risk characteristics,
country and days past due. The unbilled accrued revenues have
substantially the same risk characteristics as the trade receivables
for the same types of contracts. The Group has therefore concluded
that the expected loss rates for trade receivables are a reasonable
approximation of the loss rates for the unbilled accrued revenue.
The credit verification procedures in relation to trade receivables and
unbilled accrued revenue include the assessment of the creditwor-
thiness of the customer by using sources of quality information such
as external specialist reports, audited annual reports, press articles
or rating agencies. Should the customer be a governmental entity, the
official debt rating of the respective country is a key driver in
determining the appropriate credit risk category.
Following this credit analysis, the customer is classified into a credit
risk category which can be as follows: ‘Prime’ (typically publicly rated
and listed entities), ‘Market’ (usually higher growth companies with
higher leverage), ‘Sub-prime’ (customers for which viability is depend-
ent on continued growth with higher leverage), or Government
(governments or governmental institutions, subject to the corre
-
sponding country meeting minimum credit rating criteria). The credit
profile is updated at least once a year for all key customers with an
ongoing contractual relationship.
SES ANNUAL REPORT 2021137
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Impairment of trade receivables and unbilled accrued
revenue
The Group applies the IFRS 9 simplified approach to measuring
expected credit losses for trade receivables and unbilled accrued
revenue by measuring the loss allowance at an amount equal to life-
time expected credit losses. To measure the expected credit losses,
trade receivables and unbilled accrued revenue have been grouped
in portfolios based on shared credit risk characteristics (credit risk
profile: Prime, Market, Sub-prime, and Government), country and the
days past due.
In order to compute the provision, the gross trade receivables balance
is reduced for any portion representing deferred revenue and any
securities held. Trade receivables are written off when there is no
reasonable expectation of recovery. The Group’s largest customers
are large media companies and government agencies, and hence the
credit risk associated with these contracts is assessed as low.
The Company calculates loss expectancy rates based on the history
of losses and forward-looking information to create a provision matrix.
On that basis, the provision as at 31 December 2021 and 31 December
2020 is as follows:
Impairment of Trade Receivables and
Unbilled Accrued Revenues 2021
€ MILLION Current
Less
than
1 month
Between
1 and
3 months
More
than
3 months Total
31 December 2021
Average expected
loss rate
(by portfolio) 3.8% 4.9% 6.6% 10.9%
Gross carrying
amount – trade
receivables 131 24 32 170 357
Provision – – 1 6 7
Impairment of Trade Receivables and
Unbilled Accrued Revenues 2020
€ MILLION Current
Less
than
1 month
Between
1 and
3 months
More
than
3 months Total
31 December 2020
Average expected
loss rate
(by portfolio) 4.1% 5.1% 7.5% 12.1%
Gross carrying
amount – trade
receivables 164 40 33 156 393
Provision – – 1 8 9
The provision in respect of unbilled accrued revenue as at 31 Decem-
ber 2021 amounts to € 13 million and the corresponding expected
credit loss is 3.4% (31 December 2020: € 9 million and the correspond-
ing expected credit losses is 2.2%).
An amount of € 0.5 million (2020: € 6.3 million) was expensed in 2021
reflecting an increase in the IFRS 9 related provision for trade and
other receivables.
Additional provisions are recorded for trade receivables balances if
specific circumstances or forward-looking information lead the Group
to believe that additional collectability risk exists with respect to
customers that are not reflected in the loss expectancy rates. A cumu-
lative provision for trade receivables of € 86 million has been recorded
as of 31 December 2021 (31 December 2020: € 84 million).
The movement in provisions for trade receivables and unbilled
accrued revenue as at 31 December 2021 and 2020 are as follows:
Movement in Provisions for Trade Receivables and
Unbilled Accrued Revenue
Provisions for
trade
receivables
Provisions for
unbilled accrued
revenue
€ MILLION 2021 2020 2021 2020
At 1 January 93 94 9 19
Increase in provision
recognised in profit or loss
during the year 39 75 4 2
Receivables written off dur-
ing the year as uncollectible (32) (28) – (11)
Unused amount reversed (13) (41) (3) (1)
Other movements – – 3 –
Impact of currency
translation 6 (7) – –
At 31 December 93 93 13 9
C-band repurposing receivables
The Group recorded C-band repurposing receivables upon receiving
validation that the Group successfully met the Phase 1 Accelerated
Relocation deadline and for costs incurred related to C-band spec-
trum clearing for which the Group expects to be reimbursed. The
Group considered the credit risk related to the C-band repurposing
receivables at the end of 2021 and 2020 and concluded that an esti-
mate of zero expected credit losses is appropriate.
The U.S. government, through the FCC, developed the rules of the
C-band auction to ensure incumbent satellite operators such as the
Group are paid in full even if one or more individual overlay license
winners fails to pay the Group its assigned portion of the Group’s relo-
cation costs. An independent third-party Relocation Payment Clear-
inghouse is administering the C-band transition and related payments
SES ANNUAL REPORT 2021138
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
with FCC oversight. If an auction winner defaults on an obligation to
pay the Group, the FCC could require a license to be re-auctioned
with the same payment condition, or the FCC could require the other
auction winners to collectively pay the Group for the shortfall as a
condition for them to maintain their licenses.
Therefore, as it expects the U.S. government to regulate and ensure
the auction winners’ compliance with their payment obligations to the
Group, the Group has estimated zero expected credit losses on the
C-band repurposing receivables. Additional disclosure on the C-band
clearing project is included in >> Note 33.
FINANCIAL CREDIT RISK
With respect to the credit risk relating to financial assets, this exposure
relates to the potential default of the counterparty, with the maximum
exposure being equal to the carrying amount of these instruments.
The counterparty risk from a cash management perspective is
reduced by the implementation of several cash pools, accounts and
related paying platforms with different counterparties.
To mitigate the counterparty risk, the Group only deals with recog-
nised financial institutions with an appropriate credit rating – gener-
ally ‘A’ and above – and in adherence of a maximum trade limit for
each counterparty which has been approved for each type of
transactions. All counterparties are financial institutions which are
regulated and controlled by the national financial supervisory
authorities of the associated countries. The counterparty risk portfolio
is analysed on a quarterly basis. Moreover, to reduce this counterparty
risk the portfolio is diversified as regards the main counterparties
ensuring a well-balanced relation for all categories of products
(derivatives as well as deposits).
CAPITAL MANAGEMENT
The Group’s policy is to attain and retain an investment grade rating
from at least two reputable rating agencies. These investment grade
ratings serve to maintain investor, creditor, and market confidence.
Within this framework, the Group manages its capital structure and
liquidity in order to reflect changes in economic conditions to keep
its cost of debt low, maintain the confidence of debt investors at a
high level and to create added value for the shareholder. The Group’s
dividend policy takes into account the financial performance of the
year, cash flow developments and other factors such as yield and pay-
out ratio.
NOTE 19 – CASH AND CASH EQUIVALENTS
Cash and Cash Equivalents
€ MILLION 2021 2020
Cash at bank and in hand 872 708
Short-term deposits 177 454
Total cash and cash equivalents 1,049 1,162
Cash at banks is subject to interest at floating rates based on daily
bank deposit rates. Short-term deposits are made for varying periods
between one day and three months – depending on the immediate
cash requirements of the Group – and earn interest at the respective
short-term deposit rates. Short-term deposits and cash at bank and
in hand are held at various financial institutions meeting the credit
rating criteria set out in >> Note 18 above. See also >> Note 33 in con-
nection with the receipt of C-band Accelerated Relocation Payments
around the year end.
As at 31 December 2021, there were no investments in money market
funds, consistent with the year-end 2020 position.
NOTE 20 – SHAREHOLDERS’ EQUITY
ISSUED CAPITAL
SES has a subscribed capital of € 719 million (2020: € 719 million),
represented by 383,457,600 class A shares (2020: 383,457,600 class
A shares) and 191,728,800 class B shares (2020: 191,728,800 class B
shares) with no par value.
The movement between the opening and closing number of shares
issued per class of share can be summarised as follows:
Issued Capital
Class A
shares
Class B
shares
Total
shares
As at 1 January 2021 383,457,600 191,728,800 575,186,400
Shares issued during the year – – –
As at 31 December 2021
383,457,600 191,728,800 575,186,400
Class A
shares
Class B
shares
Total
shares
As at 1 January 2020 383,457,600 191,728,800 575,186,400
Shares issued during the year – – –
As at 31 December 2020
383,457,600 191,728,800 575,186,400
Fiduciary Deposit Receipts (‘FDRs’) with respect to Class A shares
are listed on the Luxembourg Stock Exchange and on Euronext Paris.
They can be traded freely and are convertible into Class A shares at
any time and at no cost at the option of the holder under the conditions
applicable in the Company’s articles of association and in accordance
with the terms of the FDRs.
SES ANNUAL REPORT 2021139
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
All Class B shares are currently held by the State of Luxembourg, or
by Luxembourg public institutions. Dividends paid for one share of
Class B equal 40% of the dividend for one share of Class A.
A shareholder, or a potential shareholder, who seeks to acquire,
directly or indirectly, more than 20% of the shares of the Company
must inform the Chairman of the Board of Directors of the Company
of such intention. The Chairman of the Board of Directors of the
Company shall forthwith inform the government of the Grand Duchy
of Luxembourg of the envisaged acquisition which may be opposed
by the government within three months from such information should
the government determine that such acquisition would be against the
general public interest. In case of no opposition from the government,
the Board shall convene an extraordinary meeting of shareholders
which may decide at a majority provided for in article 450-3 of the
law of 10 August 1915, as amended, regarding commercial companies,
to authorise the shareholder, or potential shareholder, to acquire more
than 20% of the shares. If it is an existing shareholder of the Company,
it may attend the general meeting and will be included in the count
for the quorum but may not take part in the vote.
SHARE BUYBACK PROGRAMME
On 6 May 2021 the Company announced a share buyback programme
to be executed by 31 December 2021 under the authorisation given
by the Annual General Meeting of shareholders held on 1 April 2021.
During the year the Group acquired 12 million Class A shares at a
weighted average price of € 6.56 per A-share and 6 million Class B
shares at a price of € 2.62 per B-share, resulting in a total cost of the
programme of € 94 million. The shares acquired under the programme
are expected to be cancelled before the end of 2022 to reduce the
total number of voting and economic shares in issue on completion
of the programme, subject to the receipt of the relevant shareholder
approval.
Subject to the agreement of the shareholders, the Company pur-
chases FDRs in respect of ‘Class A’ shares in connection with execu-
tives’ and employees’ share-based payment plans. At the year-end,
the Company held FDRs relating to the above schemes as set out
below. These FDRs are disclosed as treasury shares in the consoli-
dated statement of financial position and are carried at acquisition
cost as a deduction from equity.
Buy-Back of Treasury Shares
2021 2020
FDRs held as at 31 December 19,748,429 4,559,818
Carrying value of FDRs held (
€ million) 174 77
Class B shares held as at 31 December 6,000,000 –
Carrying value of Class B shares held (
€ million) 15 –
€ 750,000,000 DEEPLY SUBORDINATED FIXED
RATE RESETTABLE SECURITIES
In 2016 SES issued € 750,000,000 Deeply Subordinated Fixed Rate
Resettable Securities (the ‘€ 750 million perpetual bond’) at a coupon
of 4.625 percent to the first call date, a price of 99.666 and a yield of
4.7 percent. Transaction costs related to this transaction amounted
to € 20 million and have been deducted from ‘Other reserves’. Based
on the terms of issuance, the Company was entitled to call the € 750
million perpetual bond on 2 January 2022 and on subsequent coupon
payment dates.
On 18 May 2021, SES announced a capped tender offer for the bond
at a fixed purchase yield of -0.10% which was accepted by the required
number of bondholders such that the Company was able to repur-
chase 84.5% of the existing bonds on 28th May at a price represent-
ing 102.838% of nominal value, and the remaining 15.5% at par, with a
settlement date of 30 June 2021.
€ 625,000,000 DEEPLY SUBORDINATED FIXED
RATE RESETTABLE SECURITIES
On 20 May 2021 the Company announced the successful launch and
pricing of new Deeply Subordinated Fixed Rate Resettable Securities
for a total amount of € 625 million, with a first reset date on 27 August
2026. The securities bear a coupon of 2.875% per annum and were
priced at 99.409% of their nominal value. The proceeds of the new
issuance were received on 27 May 2021.
Tender premium and transaction costs for these transactions
amounted to € 26 million and have been deducted from “Other
reserves”.
€ 550,000,000 DEEPLY SUBORDINATED FIXED
RATE RESETTABLE SECURITIES
In 2016 SES issued a second perpetual bond of € 550,000,000 (the
‘€ 550 million perpetual bond’) at a coupon of 5.625 percent to the
first call date, a price of 99.304 and a yield of 5.75 percent. Trans action
costs related to this transaction amounted to € 8 million and have
been deducted from ‘Other reserves’. This brought the aggregate per-
petual bond issued by the Group to € 1,300 million. SES is entitled to
call the € 550 million perpetual bond on 29 January 2024 and on sub
-
sequent coupon payment dates.
As the Company has no obligation to redeem either of the bonds, and
the coupon payments are discretionary, it classified the net proceeds
from the issuance of the securities (together € 1,121 million net of
transaction costs and tax) as equity. The perpetual bonds are guar-
anteed on a subordinated basis by SES Global Americas Holdings GP.
SES used the net proceeds from the offerings for the repayment of
O3b debt, the repayment of certain existing indebtedness of the
Group, as well as for general corporate purposes.
SES ANNUAL REPORT 2021140
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Coupon payments in respect of the perpetual bonds occurred on
4 January 2021 (€ 35 million), 29 January 2021 (€ 31 million), 27 May
2021 (€ 11 million), 21 June 2021 (€ 3 million) and 27 August 2021 (€ 5
million) and have been deducted from ‘Other reserves’. The corre
-
sponding payments in 2020 were on 2 January 2020 (€ 35 million)
and 29 January 2020 (€ 31 million) and were also deducted from
‘Other reserves’.
Tax on the perpetual bond coupon accrual of € 20 million (2020: € 18
million) has been credited to ‘Other reserves”.
OTHER RESERVES
In accordance with Luxembourg legal requirements, a minimum of 5%
of the yearly statutory net profit of the Company is transferred to a
legal reserve which is non-distributable. This requirement is satisfied
when the reserve reaches 10% of the issued share capital. As at
31 December 2021 a legal reserve of € 72 million (2020: € 72 million)
is included within other reserves.
Other reserves include a non-distributable amount of € 189 million
(2020: € 77 million) linked to treasury shares, and an amount of € 181
million (2020: € 228 million) representing the net worth tax reserve
for 2015-2018, for which the distribution would result in the payment
of net worth tax at a rate of up to 20% of the distributed reserve in
accordance with Luxembourg law requirement.
NOTE 21 – NON-CONTROLLING INTEREST
Set out below is the summarised financial information for each
subsidiary that has non-controlling interests (NCI) that are material
to the Group. The amounts disclosed for each subsidiary are before
inter-company eliminations.
Summarised Financial Information for each subsidiary
that has Non-Controlling Interests, material to the
Group: Balance Sheet
€ MILLION
LuxGovSat S.A.
(50% NCI)*
Al Maisan Satellite
Communications LLC,
UAE (65% NCI)*
Summarised
balance
sheet 2021 2020 2021 2020
Current assets 18 39 14 12
Current liabilities (18) (27) (3) (4)
Current net assets – 12 11 8
Non-current assets 159 178 27 28
Non-current liabilities (83) (100) – –
Non-current net
assets 76 78 27 28
Net assets 76 90 38 36
Accumulated NCI 38 45 25 24
Transactions with
non-controlling
interests – – – –
* Refer to Note 2
Summarised Financial Information for each subsidiary
that has Non-Controlling Interests, material to the
Group: Statement of Comprehensive Income
€ MILLION
LuxGovSat S.A.
(50% NCI)
Al Maisan Satellite
Communications LLC,
UAE (65% NCI)
Summarised
statement of com-
prehensive income 2021 2020 2021 2020
Revenue 23 21 9 7
Operating expenses (15) (16) (4) (8)
Profit/(loss)
for the period (15) (13) 1 (4)
Other comprehensive
income – – – –
Total comprehensive
income (15) (13) 1 (4)
Profit/(loss)
allocated to NCI (7) (6) 1 (3)
Dividend paid to NCI – – – –
SES ANNUAL REPORT 2021141
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Summarised Financial Information for each
subsidiary that has Non-Controlling Interests,
material to the Group: Cash Flows
€ MILLION
LuxGovSat S.A.
(50% NCI)
Al Maisan Satellite
Communications LLC,
UAE (65% NCI)
Summarised
cash flows 2021 2020 2021 2020
Cash flows from/
(absorbed by)
operating activities 6 8 4 3
Cash flows from/
(absorbed by)
investing activities (1) – (3) –
Cash flows from/
(absorbed by)
financing activities (38) 6 – –
Net foreign exchange
movements – – – –
Net increase/
(decrease) in cash
and cash equivalents (33) 14 1 3
NOTE 22 – SHARE-BASED COMPENSATION
PLANS
The Group has four share-based compensation plans which are
detailed below. In the case of the Stock Appreciation Rights Plan and
Equity Incentive Compensation Plan the relevant strike price is
defined as the average of the market price of the underlying shares
over a period of 15 trading days before the date of the grant.
1) The Stock Appreciation Rights Plan (‘STAR Plan’)
The STAR Plan is an equity-settled plan available to non-executive
staff of Group subsidiaries, where share options are granted. In Jan-
uary 2011, the STAR Plan was amended and, for all options granted
2011 onwards, a third of the share options vest and can be exercised
each year. After being fully vested, the share options have a four-year
exercise period.
Stock Appreciation Rights Plan
2021 2020
Outstanding options at the end of the year 700,553 1,134,170
Weighted average exercise price in euro 27.61 27.31
All of the 700,553 outstanding options as at 31 December 2021 (2020:
1,134,170), are fully vested and exercisable. No options were exercised
in 2021 or in 2020.
Movements in the number of share options outstanding and their
related weighted average exercise prices in euro are as follows:
Stock Appreciation Rights Plan:
Movements in the Number of Share Options
Outstanding and their Related Weighted Average
Exercise Price
2021 2020
Average
exercise
price per
share
option
Number of
options
Average
exercise
price per
share
option
Number of
options
As at 1 January 27.31 1,134,170 26.52 1,594,540
Forfeited 26.81 (433,617) 24.58 (460,370)
Exercised – – – –
At 31 December 27.61 700,553 27.31 1,134,170
Share options outstanding at the end of the year have the following
expiry date and exercise prices in euro:
Stock Appreciation Rights Plan:
Share Options Outstanding at the End of The Year
Grant Expiry date
Exercise price
per share
options Number of options
2021 2020
2016 2023 24.39 428,639 488,338
2015 2022 32.73 271,914 313,802
2014 2021 26.50 – 332,030
700,553 1,134,170
SES ANNUAL REPORT 2021142
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
2) Simulated Restricted Share Units (‘SRSU’)
In 2017 the Group introduced a new compensation plan which is pro-
gressively replacing the STAR Plan. SRSU are cash-settled awards
delivered on 1 June following a three-year vesting period. The liability
for the cash-settled awards is measured initially and at the end of
each reporting period until settled, at the fair value of the share appre-
ciation rights, taking into account the terms and conditions on which
the stock appreciation rights were granted and recognised to the
extent to which the employees have rendered services to date.
During 2021, 850,783 SRSU have been granted (2020: 864,428).
During the same period, 153,050 SRSUs have been forfeited (2020:
98,645) and 307,754 SRSU have been vested (2020: 221,056). A liability
of € 5,453,399 has been recognised in the consolidated statement of
financial position as of 31 December 2021 (31 December 2020:
€ 4,591,628) based on the 1,793,435 outstanding SRSUs (31 December
2020: 1,403,456) measured at the Group’s share price at the end of
the year on a pro-rata basis over 3 years vesting period.
3) Equity Based Compensation Plan comprising options
(‘EBCP Option’)
The EBCP Option is available to Group executives. Under the plan,
the “date of Option Grant” means the first business day that follows
fifteen (15) market trading days for Shares after the Allocation Period
during which the Fair Market Value is fixed. Generally, one-quarter of
the entitlement vests on each 1 January of the four years following
the Date of Option Grant, but for one grant, one fifth of the entitle-
ment vests on each 1 June of the five years following the Date of
Option Grant. Once vested, the options can be exercised until the
tenth anniversary of the original grant. For 2021 EBCP Option Plan
grants, one third of the options vest on each 1 June of the following
three years.
Equity Incentive Compensation Plan
2021 2020
Outstanding options at the end of the year 18,767,922 18,364,300
Weighted average exercise price in euro
13.17 15.29
Out of 18,767,922 outstanding options as of the end of 2021 (2020:
18,364,300), 9,800,000 options are exercisable (2020: 12,241,571). In
2021 134,836 treasury shares were delivered at a weighted average
price of € 5.97 each, while in 2020 no options were exercised. On aver-
age, in 2021, the related weighted average share price at the time of
exercise was € 6.47 per share.
Movements in the number of share options outstanding and their
related weighted average exercise prices in euro are as follows:
Equity Incentive Compensation Plan: Movements
in the Number of Share Options Outstanding and
their Related Weighted Average Exercise Prices
2021 2020
Average
exercise
price per
share option
Number of
options
Average
exercise
price per
share option
Number of
options
At 1 January 15.29 18,364,300 18.6 14,908,795
Granted 6.40 3,418,751 5.97 4,824,735
Forfeited 19.00 (2,880,293) 18.61 (1,369,230)
Exercised 5.97 (134,836) – –
At 31 December 13.17 18,767,922 15.29 18,364,300
Share options outstanding at the end of the year have the following
expiry date and exercise prices in euro:
Equity Incentive Compensation Plan:
Expiry Date and Exercise Prices
Grant Expiry date
Exercise price
per share
options
Number of
options
2021 2020
2021 2031 6.40 3,328,751 0
2020 2030 5.97 4,589,286 4,816,869
2019 2029 15.01 1,953,847 2,262,401
2018 2028 18.23 407,000 407,000
2018 2028 12.67 3,657,848 4,294,036
2017 2027 21.15 2,000,274 2,511,089
2016 2026 24.39 1,407,479 1,864,557
2015 2025 32.73 546,735 750,640
2014 2024 26.5 432,030 605,363
2013 2023 23.51 230,955 315,092
2012 2022 18.1 213,717 313,392
2011 2021 17.57 – 223,861
18,767,922 18,364,300
4) Equity Based Compensation Plan (‘EBCP’)
The EBCP is also a programme for executives, and senior executives,
of the Group, comprising performance shares (‘EBCP PS’) and
restricted shares (‘EBCP RS’). Under the plan, restricted shares are
allocated to executives at the beginning of May each year and these
vest on the 1 June following the third anniversary of the grant. Senior
executives also have the possibility to be allocated performance
shares whose granting is dependent on the achievement of defined
performance criteria which are a) individual objectives and b) the
economic value added (‘EVA’) target established by the Board from
time to time. These shares also vest on the 1 June following the third
anniversary of the original grant. For 2021 EBCP grants, EVA was
replaced by the total shareholder return (‘TSR’) as the financial per-
formance criteria for vesting of performance shares.
SES ANNUAL REPORT 2021143
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Long-term Incentive Programme
2021 2020
Restricted and performance shares outstanding
at the end of the year 2,252,136 2,026,147
Weighted average fair value in euro 6.58 8.65
During 2021, 332,257 restricted shares (2020: 262,731) and 632,226
(2020: 676,743) performance shares were granted; 33,175 restricted
shares (2020: 26,298) and 262,959 performance shares (2020: 75,436)
were forfeited; and 268,442 performance shares (2020: 266,385) and
173,918 restricted shares (2020: 91,574) were exercised.
The fair value of equity-settled shares (restricted and performance
shares) granted is estimated as at the date of grant using a binomial
model for STARs and EBCP Option and a Black & Scholes model for
EBCP, taking into account the terms and conditions upon which the
options (restricted and performance shares) were granted. The fol-
lowing table lists the average value of inputs to the model used for
the years ended 31 December 2021 and 31 December 2020.
Long-term Incentive Programme:
average Value of Inputs to the Model used for 2021
2021 EBCP Option
EBCP PS
and EBCP RS
Dividend yield (%) 7.43% 7.09%
Expected volatility (%) 32.85% 35.53%
Risk-free interest rate (%) -0.58% -0.68%
Expected life of options (years) 10 3
Share price at inception (€) 6.22 6.22
Fair value per option/share (€) 0.78 5.00
Total expected cost for each plan (In € M)
2.25 6.01
Long-term Incentive Programme:
average Value of Inputs to the Model used for 2020
2020 EBCP Option
EBCP PS
and EBCP RS
Dividend yield (%) 6.89% 6.61%
Expected volatility (%) 30.42% 35.12%
Risk-free interest rate (%) -0.62% -0.64%
Expected life of options (years) 10 3
Share price at inception (€) 6.34 6.34
Fair value per option/share (€) 0.77-0.90 5.12-5.53
Total expected cost for each plan (In € M)
3.64 4.38
The expected life of the options is based on historical data and is not
necessarily indicative of exercise patterns that may occur. The
expected volatility reflects the assumption that the historical volatil-
ity is indicative of future trends, which may or may not necessarily be
the actual outcome.
The total charge for the year for share-based compensation amounted
to € 8 million (2020: € 10 million), out of which equity-settled € 5 mil-
lion (2020: € 9 million) and cash-settled € 3 million (2020: € 1 million).
NOTE 23 – INTEREST-BEARING BORROWINGS
As at 31 December 2021 and 2020, the Group’s interest-bearing bor-
rowings were:
Interest-Bearing Borrowings 2021
€ MILLION
Effective
interest
rate Maturity
Amounts
outstanding
2021, carried
at amortised
cost
Non-current
US Bond ($ 750 million) 3.60% April 2023 662
German bond (€ 150 million),
non-listed
EURIBOR
6M + 0.80% June 2024 150
German bond (€ 250 million),
non-listed 1.71%
December
2025 250
Eurobond 2026 (€ 650 million) 1.625% March 2026 654
Euro Private Placement 2027
(€ 140 million under EMTN) 4.00% May 2027 140
Eurobond 2027 (€ 500 million)
0.875%
November
2027 497
Eurobond 2028 (€ 400 million) 2.00% July 2028 395
Fixed Term Loan (LuxGovSat)
3.30%
December
2027 82
German bond (€ 50 million),
non-listed 4.00%
November
2032 50
US Bond ($ 250 million) 5.30% April 2043 214
US Bond ($ 500 million) 5.30% March 2044 430
Total non-current 3,524
Current
Coface EURIBOR
6M + 1.70%
Various
in 2021 40
Fixed Term Loan (LuxGovSat)
3.30%
December
2027 17
Total current
57
SES ANNUAL REPORT 2021144
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Interest-Bearing Borrowings 2020
€ MILLION
Effective
interest
rate Maturity
Amounts
outstanding
2020,carried
at amortised
cost
Non-current
Coface EURIBOR
6M + 1.70%
Various
2022 40
US Bond ($ 750 million) 3.60% April 2023 610
German bond (€ 150 million),
non-listed
EURIBOR
6M + 0.80% June 2024 150
German bond (€ 250 million),
non-listed 1.71%
December
2025 249
Eurobond 2026 (€ 500 million) 1.625% March 2026 496
Euro Private Placement 2027
(€ 140 million under EMTN) 4.00% May 2027 140
Eurobond 2027 (€ 500 million)
0.875%
November
2027 497
Eurobond 2028 (€ 400 million) 2.00% July 2028 395
Fixed Term Loan (LuxGovSat)
3.30%
December
2027 98
German bond (€ 50 million),
non-listed 4.00%
November
2032 50
US Bond ($ 250 million) 5.30% April 2043 197
US Bond ($ 500 million) 5.30% March 2044 395
Total non-current 3,317
Current
Coface EURIBOR
6M + 1.70%
Various
in 2021 41
Eurobond 2021 (€ 650 million)
4.75%
March
2021 556
Fixed Term Loan (LuxGovSat)
3.30%
December
2027 16
Total current 613
European Medium-Term Note Programme (‘EMTN’)
SES has an EMTN Programme enabling SES, or SES Global Americas
Holdings GP, to issue as and when required notes up to a maximum
aggregate amount of € 4,000 million. As at 31 December 2021, SES
had issued € 1,690 million (2020: € 2,096 million) under the EMTN
Programme with maturities ranging from 2026 to 2028.
€ 650 million Eurobond (2020)
SES repaid its € 650 million 10-year bond under the Company’s Euro-
pean Medium-Term Note Programme issued 2010, with a fixed inter-
est rate of 4.625% on March 9, 2020.
€ 650 million Eurobond (2021)
In 2021 SES fully repaid a € 650 million bond under the Company’s
European Medium-Term Note Programme, with a fixed rate coupon
of 4.75%.
German bond issue of € 400 million (2024/2025)
In 2018 the Group closed the issuance of an aggregated amount of
€ 400 million in the German bond (‘Schuldschein’) market. The trans-
action consists of two individual tranches – a € 150 million tranche
with a floating interest rate of a six-month EURIBOR plus a margin of
0.8% and a final maturity date on 18 June 2024 as well as a € 250 mil-
lion tranche with a fixed interest rate of 1.71% and a final maturity date
on 18 December 2025.
€ 650 million Eurobond (2026)
In 2018 SES issued a € 500 million 8-year bond under the Company’s
European Medium-Term Note Programme. On the 22 June 2021 SES
announced the successful lunch and pricing of a tap of its 1.625%
Notes in which it has agreed to sell incremental senior unsecured
fixed rate notes for a total amount of € 150 million. The new notes
were priced at 106.665% of their nominal value. The bond bears inter-
est at a fixed rate of 1.625% and has a final maturity date on 22 March
2026.
€ 500 million Eurobond (2027)
On 4 November 2019, SES issued a € 500 million bond under the
Company’s European Medium-Term Note Programme. The bond has
an 8-year maturity and bears interest at a fixed rate of 0.875% and
has a final maturity date on 4 November 2027.
€ 140 million Private Placement (2027)
In 2012 SES issued three individual tranches of a total € 140 million
Private Placement under the Company’s European Medium-Term Note
Programme with ING Bank N.V. The Private Placement has a 15-year
maturity, beginning 31 May 2012, and bears interest at a fixed rate of
4.00%.
€ 400 million Eurobond (2028)
On 2 July 2020, SES issued a € 400 million bond under the Compa-
ny’s European Medium-Term Note Programme. The bond has an
8-year maturity and bears interest at a fixed rate of 2.00% and has a
final maturity date on 2 July 2028.
German bond issue of € 50 million (2032)
In 2012 the Group signed an agreement to issue € 50 million in the
German bond (‘Schuldschein’) market. The German bond bears a fixed
interest rate of 4.00% and matures on 12 November 2032.
144A Bond $ 750 million (2023)
In 2013 SES completed a 144A offering in the US market issuing $ 750
million 10-year bond with a coupon of 3.60% and a final maturity date
on 4 April 2023.
144A Bond $ 250 million (2043)
In 2013 SES completed a 144A offering in the US market issuing $ 250
million 30-year bond with a coupon of 5.30% and a final maturity date
on 4 April 2043.
SES ANNUAL REPORT 2021145
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
144A Bond $ 500 million (2044)
In 2014 SES completed a 144A offering in the US market issuing $ 500
million 30-year bond with a coupon of 5.30% and a final maturity date
of 25 March 2044.
Syndicated loan 2019
The facility is being provided by 19 banks and has been structured
as a 5-year multi-currency revolving credit facility. In 2021 the
Company extended the Termination date from 26 June 2025 to 26
June 2026. The facility is for € 1,200 million and the interest payable
is linked to a ratings grid. At the current SES credit rating of
BBB- / Baa2, the interest rate is 45 basis points over EURIBOR/LIBOR.
As at 31 December 2021 and 2020, no amount has been drawn under
this facility.
€ 523 million Coface facility
In 2009 SES signed a financing agreement with Compagnie Française
d’Assurance pour le Commerce Extérieur (‘Coface’) in respect of the
investment in four geostationary satellites (ASTRA 2E, ASTRA 2F,
ASTRA 2G, ASTRA 5B). The facility is divided into five loans. The
drawings under the facility are based on invoices from the supplier of
the satellites.
The first drawing was done on 23 April 2010 and all loan tranches
became fully drawn in November 2014. Each Coface tranche is repay-
able in 17 equal semi-annual instalments where Coface A has a final
maturity date of 1 August 2022, Coface F matured on 21 May 2021 and
Coface C and D will mature on 3 October 2022. The entire facility
bears interest at a floating rate of six-month EURIBOR plus a margin
of 1.7%. In November 2017, SES opted to execute voluntary prepay-
ment clauses pursuant to the Agreement and repaid the remaining
outstanding amount of Coface tranche B as per 21 November 2017.
All other Coface tranches remain in place as contracted.
€ 115 million Credit Facility (LuxGovSat)
In 2015 LuxGovSat S.A. signed a financing agreement with BGL BNP
Paribas for € 115 million at a fixed rate coupon of 3.30%. The facility
is repayable in 14 semi-annual installments and has a final maturity
date of 1 December 2027.
As at 31 December 2021, total borrowings of € 99 million were out-
standing under the fixed term facility.
Negotiable European Commercial Paper “NEU CP”
(formerly French Commercial paper programme)
In 2005 SES put in place a € 500 million ‘NEU CP’ programme in
accordance with articles L.213-1 to L213-4 of the French Monetary
and Financial Code and article 6 of the order of 30 May 2016 and
subsequent amendments. The maximum outstanding amount of ‘NEU
CP’ issuable under the programme is € 500 million or its counter value
at the date of issue in any other authorised currency. On 21 May 2021,
this programme was extended for one further year.
As at 31 December 2021 and 2020, no borrowings were outstanding
under this programme.
European Commercial paper programme
In 2012 SES signed the documentation for the inception of a joint
€ 1,000 million guaranteed European commercial paper programme
of SES S.A. and SES Global Americas Holdings GP. Issuances under
the programme represent senior unsecured obligations of the issuer
and any issuance under the programme is guaranteed by the non-is-
suing entity. The programme is rated by Moody’s Investors Services
and is compliant with the standards set out in the STEP Market Con-
vention. On 9 July 2021, this programme was updated and extended.
As at 31 December 2021 and 2020, no borrowings were outstanding
under this programme.
IBOR Reform
Certain benchmark rates used in financing agreements and financial
derivatives are currently being modified and either have been termi-
nated (GBP LIBOR or CHF LIBOR) or are planned to be terminated
during the next few years (EURIBOR, USD LIBOR). The Group has
financing arrangements which are based on two of these benchmark
rates (EURIBOR or USD LIBOR). These changes did not have any
material impact on the Group’s consolidated financial statements.
NOTE 24 – PROVISIONS
Provisions
€ MILLION 2021 2020
Non-current 6 12
Current 56 60
Total 62 72
SES ANNUAL REPORT 2021146
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Movements in each class of provision during the financial year are set
out below:
Movements in Each Class of Provisions
€ MILLION Group tax provision
Restructuring
provision Other provisions Total
As at 1 January 2021 46 23 3 72
Additional provisions recognised 2 8 – 10
Unused amounts reversed (7) – – (7)
Used during the year – (15) (1) (16)
Reclassification to income tax payable – – – –
Impact of currency translation 3 – – 3
As at 31 December 2021 44 16 2 62
Non-current 4 – 2 6
Current 40 16 – 56
As at 1 January 2020 52 8 3 63
Additional provisions recognised 11 40 – 51
Unused amounts reversed (3) (5) – (8)
Used during the year (8) (18) – (26)
Reclassification to income tax payable – (1) – (1)
Impact of currency translation (6) (1) – (7)
As at 31 December 2020 46 23 3 72
Non-current 9 – 3 12
Current 37 23 – 60
GROUP TAX PROVISION
Group tax provision mainly relates to Indian withholding taxes and
potential associated interest charges. The decrease in the Group tax
provision was mainly due to the reversal of provisions following the
elimination of the uncertainties that gave rise to the recognition of
these provisions.
RESTRUCTURING PROVISION
Expenses of the period include an amount of € 8 million (2020: € 40
million) of charges associated with the reorganisation of the Group’s
operations, mainly in the framework of the Group’s ‘Simplify & Amplify’
programme. These comprise primarily personnel measures such as
the implementation of an incentive programme for early retirement
and measures to adjust staffing levels and structures in certain areas,
as well as the cessation of operations in certain locations.
Reflecting these activities, the consolidated statement of financial
position includes a provision of € 16 million (2020: € 23 million). No
new initiatives are expected under the current restructuring pro-
gramme which would result in additional charges in the following
years.
SES ANNUAL REPORT 2021147
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 25 – TRADE AND OTHER PAYABLES
Trade and Other Payables
€ MILLION 2021 2020
Trade creditors 91 94
Payments received in advance
(please also see >> Note 26) 1 40
Interest on borrowings 31 51
Personnel-related liabilities 75 35
Tax liabilities other than for income tax 20 19
Other liabilities 74 61
Total 292 300
Tax liabilities mainly relate to VAT payables in the amount of € 14 mil-
lion as of 31 December 2021 (2020: € 11 million).
NOTE 26 – OTHER LONG-TERM LIABILITIES
Other Long-Term Liabilities
€ MILLION 2021 2020
Employee benefits obligations 17 27
Payments received in advance 48 80
Other long-term liabilities 18 20
Total 83 127
EMPLOYEE BENEFITS OBLIGATIONS
In the Group’s US operations certain employees benefit from an exter-
nally insured post-retirement health benefit plan. During 2021,
changes to the plan’s rules resulted in a reduction in the corre
-
sponding employee benefit obligation provision of € 10 million,
included under ‘Staff costs’ in the consolidated income statement.
As at 31 December 2021, accrued premiums of € 9 million (2020:
€ 19 million) are included in this position.
Contributions made in 2021 to Group pension schemes totalled
€ 2 million (2020: € 2 million), which are recorded in the consolidated
income statement under ‘staff costs’.
In addition, certain employees of the US operations benefit from
defined contribution pension plans. A liability of € 10 million has been
recognised as at 31 December 2021 (2020: € 11 million) in this respect,
out of which € 3 million is included under ‘Trade and other payables’
(2020: € 3 million).
PAYMENTS RECEIVED IN ADVANCE
In the framework of receivables securitisation transactions completed
in June 2018 and June 2019 the Group received a net cash amount
of € 88 million and € 59 million, respectively, from a financial institu-
tion as advance settlement of future receivables arising until 2022
under contracts with a specific customer.
A corresponding aggregate liability of € 82 million (2020: € 119 mil-
lion), representing SES’s obligation towards the financial institution
to continue to provide services to the customer in accordance with
the terms of the customer contract, is recorded in the consolidated
statement of financial position as at 31 December 2021 under ‘Other
long-term liabilities’ for € 48 million (2020: € 80 million) and under
‘Trade and other payables’ for € 34 million (2020: € 39 million).
OTHER LONG-TERM LIABILITIES
The other long-term liabilities include customer collateral deposits
amounting to € 18 million (2020: € 20 million).
NOTE 27 – FIXED ASSETS SUPPLIERS
Fixed Assets Suppliers
€ MILLION 2021 2020
Non-current 472 1,310
Current 1,554 67
Fixed assets suppliers represent liabilities for assets being either
acquired directly through procurement contracts with asset manu-
facturers, or in the framework of agreements whereby the asset is
being acquired by an intermediary but where in substance SES bears
the risks and rewards of the procurement.
In the latter case the Company accrues for construction-related
liabilities on the basis of pre-determined milestones agreed between
the manufacturer and the relevant parties, see also >> Note 28.
Non-current fixed assets suppliers are initially recognized at fair value
and subsequently measured at amortised cost using the effective
interest method.
The main procurements under this caption are:
• The O3b mPOWER medium-Earth orbit constellation: € 1,046 mil-
lion (2020: € 860 million);
•
The SES-17 satellite programme: € 248 million (2020: € 189 million);
• Six satellites being procured in connection with the C-band repur-
posing activities: € 655 million (2020: € 313 million) >> Note 33;
•
Two satellites for the replacement of Astra 19.2°E satellites:
€ 56 million (2020: € nil)
SES ANNUAL REPORT 2021148
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Acquisition of the SES O3b mPOWER medium-Earth orbit
constellation and launchers
On 11 September 2017, the Company, jointly with its subsidiary O3b
Networks Limited, entered as Procurement Agents into a Master Pro-
curement Agency and Option Agreement with a financial institution
in connection with the procurement by that financial institution of
seven medium-Earth orbit satellites from a satellite manufacturer. The
satellites were divided into 2 sub-blocks (sub-Block 1 A consisting of
four satellites and sub-block 1B consisting of three satellites) cur-
rently under construction. At the end of the satellite construction
period, which is foreseen in 2021, the Group will have the right to
acquire, or lease, the satellites from the financial institution or to direct
their sale to a third-party.
In August 2020 the Company exercised the option under the Purchase
and Sale agreement to procure four additional O3b mPOWER satel-
lites. The Company, jointly with its subsidiary O3b Networks Limited,
entered as Procurement Agent into a second Master Procurement
Agency and Option Agreement with a financial institution in connec-
tion with the procurement by that financial institution of the additional
satellites. At the end of the satellite construction period, foreseen in
2022, the Group will have the right to acquire, or lease, the satellites
from the financial institution or to direct their sale to a third-party.
Since the underlying Satellite Purchase and Sale Agreements are
directly between the financial institutions and the satellite manufac-
turer, there is no contractual obligation on the side of the Procure-
ment Agents during the satellite construction process. However, SES
management takes the view that there is a constructive obligation
arising over the procurement period and hence the Group is accruing
for the costs of this programme. SES has the right to nominate shortly
before the end of the construction period the entity within the Group
which will acquire or lease those assets. SES management expects
that the satellites will be acquired or leased in due course by the com-
pany SES mPOWER S.à r.l. in Luxembourg.
NOTE 28 – COMMITMENTS AND
CONTINGENCIES
CAPITAL EXPENDITURE COMMITMENTS
The Group had outstanding commitments in respect of contracted
capital expenditure totalling € 712 million as at 31 December 2021
(2020: € 948 million). These commitments largely reflect the procure-
ment of satellites and satellite launchers and are stated net of liabil-
ities under these programmes which are already disclosed under
“Fixed assets suppliers”, >> Note 27. The commitments as at 31 Decem-
ber 2021 also include € 87 million (2020: € 87 million) in connection
with the renewal of the agreement with Luxembourg government in
respect of SES’s concession to operate satellites under Luxembourg’s
jurisdiction, as disclosed in >> Note 14 –“Intangible assets”.
The capital expenditure commitments arising under these agree-
ments as at 31 December are as follows:
Capital Expenditure Commitments
€ MILLION 2021 2020
Within one year 512 497
After one year but not more than five years 147 395
After more than five years 53 56
Total 712 948
OTHER COMMITMENTS
The Group’s other commitments mainly comprise transponder service
agreements for the purchase of satellite capacity from third parties
under contracts with a maximum life of eight years, as well as € 70
million capital contribution into a Luxembourg space sector fund in
connection with the renewal of the agreement with Luxembourg
government in respect of SES’s concession to operate satellites under
Luxembourg’s jurisdiction.
Other Commitments
€ MILLION 2021 2020
Within one year 68 150
After one year but not more than five years 126 160
After more than five years 75 60
Total 269 370
The total expense recognised for transponder service agreements in
2021 was € 68 million (2020: € 82 million).
LITIGATION
There were no significant litigation claims against the Group as at 31
December 2021, or as at 31 December 2020.
GUARANTEES
On 31 December 2021 the Group had outstanding bank guarantees
of € 67 million (2020: € 89 million) with respect to performance and
warranty guarantees for services of satellite operations.
NOTE 29 – LEASES
1) LESSOR
During 2021 the Group recognised leasing income of € 32 million
(2020: € 40 million) related to one (2020: one) customer lease con-
tract. The lease matured in November 2021, so there is no related
carrying amount of property, plant and equipment leased as at
31 December 2021 (31 December 2020: € 69 million).
2) LESSEE
The Group has recognised right-of-use assets, and associated liabil-
ities, in relation to contracts previously classified as “operating leases”
SES ANNUAL REPORT 2021149
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
under the provision of IAS 17. These assets and liabilities were meas-
ured at the present value of the remaining lease payments, discounted
using the Group’s weighted average incremental borrowing rate of
2.76% as at 31 December 2021 (3.14% as at 31 December 2020). The
difference between the operating lease commitments and the right-
of-use assets recognised represents impact of discounting over the
outstanding lease term.
i) Amounts recognised in the consolidated statement of
financial position
The Group leases office buildings, ground segment assets and
other fixtures and fittings, tools and equipment, information
about which is presented below.
Group leases of Offices, Ground Segment,
Assets and other Fixtures, Tools and Equipment,
Information 2021
€ MILLION Buildings
Ground
segment
Other fix-
tures and
fittings,
tools and
equipment
31 Decem-
ber 2021
Right-of-use assets
Cost 42 15 3 60
Accumulated
depreciation (19) (9) (2) (30)
Total
23 6 1 30
Group leases of Offices, Ground Segment,
Assets and other Fixtures, Tools and Equipment,
Information 2020
€ MILLION Buildings
Ground
segment
Other fix-
tures and
fittings,
tools and
equipment
31 Decem-
ber 2020
Right-of-use assets
Cost 39 13 4 56
Accumulated
depreciation (14) (6) (2) (22)
Total
25 7 2 34
There were no material additions to the right-of-use assets during
2021, depreciation charge for the year was € 11 million (2020:
€ 15 million).
Lease liabilities are presented below as at 31 December:
Lease Liabilities
€ MILLION 2021 2020
Maturity analysis – contractual undiscounted
cash flows
Within one year 12 13
After one year but not more than five years 19 26
More than five years 8 4
Total
39 43
Lease liabilities included in the statement of
financial position at 31 December
Current 11 12
Non-current 22 25
Total
33 37
The leases of office buildings typically run for a period of 2-10 years
and leases of ground segment assets for 5 years. Some leases include
an option to renew the lease for an additional period after the end of
the contract term. The Group assesses at lease commencement
whether it is reasonably certain to exercise the extension option. The
Group reassesses whether it is reasonably certain to exercise the
options if there is a significant event or significant change in circum-
stances within its control.
ii) Amounts recognised in the consolidated income
statement
Depreciation charge of right-of-use assets:
Depreciation Charge of Right-of-Use Assets
€ MILLION 2021 2020
Buildings 7 11
Ground segment 3 3
Other fixtures and fittings, tools and equipment 1 1
Total 11 15
Finance cost:
Finance Cost
€ MILLION 2021 2020
Interest expense 1 1
Total 1 1
The total cash outflow for leases in 2021 was € 14 million (2020:
€ 15 million).
SES ANNUAL REPORT 2021150
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 30 – CASH FLOW INFORMATION
NON-CASH INVESTING ACTIVITIES
Purchases of property, plant and equipment or intangible assets not
included as a cash outflow in the consolidated statement of cash flows
are disclosed in >> Notes 12, 13 and 14.
NET DEBT RECONCILIATION
This section sets out an analysis of net debt and the movements in
net debt for 2021 and 2020.
Net debt 2021 and 2020
€ MILLION 2021 2020
Cash and cash equivalents 1,049 1,162
Borrowings – repayable within one year (57) (613)
Borrowings – repayable after one year (3,524) (3,317)
Net debt
1
(2,532) (2,768)
Cash and cash equivalents 1,049 1,162
Borrowings – floating rates (190) (231)
Borrowings – fixed interest rates (3,391) (3,699)
Net debt
1
(2,532) (2,768)
1
Net debt excludes current and non-current lease liabilities. Including these, net debt
as at 31 December 2021 was € 2,565 million (2020: € 2,805 million)
Movements in Net Debt for 2021 and 2020
€ MILLION
Cash and cash
equivalents
Borrowings – repayable
within one year
Borrowings – repayable
after one year Total
Net debt as at 1 January 2021 1,162 (613) (3,317) (2,768)
Cash flows (net) (116) 614 (159) 339
Foreign exchange adjustments 3 – (101) (98)
Transfers – (57) 57 –
Other non-cash movements* – (1) (4) (5)
Net debt as at 31 December 2021 1,049 (57) (3,524) (2,532)
Net debt as at 1 January 2020 1,155 (691) (3,737) (3,273)
Cash flows (net) 19 785 (395) 409
Foreign exchange adjustments (12) – 113 101
Transfers – (707) 707 –
Other non-cash movements* – (5) (5)
Net debt as at 31 December 2020 1,162 (613) (3,317) (2,768)
* related to loan origination costs
During 2021 the Group issued European Commercial Paper for
€ 275 million (2020: € 159 million) and reimbursed € 275 million
(2020: € 159 million). These have been presented net in the consoli-
dated statement of cash flows.
SES ANNUAL REPORT 2021151
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 31 – RELATED PARTIES
The state of Luxembourg holds a direct 11.58% voting interest in the
Company and two indirect interests, both of 10.88% each, through two
state owned banks, Banque et Caisse d’Epargne de l’Etat and Société
Nationale de Crédit et d’Investissement. These shares constitute the
Company’s Class B shares, as described in >> Note 20.
The total remuneration to directors for attendance at board and com-
mittee meetings in 2021 amounted to € 1.1 million (2020: € 1 million).
These amounts are computed on a fixed and variable basis, the var-
iable part being based upon attendance at board and committee
meetings.
The key management of the Group, defined as the Senior Leadership
Team, received compensation as follows:
Group Management Compensation
€ MILLION 2021 2020
Remuneration including bonuses and other
benefits 7 5
Pension benefits 1 1
Share-based compensation plans 2 2
Total 10 8
The total outstanding amount in respect of share-based payment
instruments allocated to key management as at 31 December 2021
were 4,916,470 (2020: 3,843,944).
NOTE 32 – IMPLICATIONS OF COVID-19
The continuing COVID-19 pandemic has had, and continues to have,
widespread economic implications across nearly all economic sectors,
including our own, and management continues to monitor carefully
the impact on different aspects of our financial performance and to
respond accordingly to protect the financial interests of the Group.
We have set out our analysis below into four areas of current, or
potential, impact:
OPERATIONAL RISK
Overall, COVID-19 has continued to have a pronounced short and
medium-term impact, significantly challenging the contract base,
renewals and dampening growth across Mobility, Energy, Government,
as well as stretching cash flows across much of the industry, and
accelerating a restructuring / consolidation process in some parts of
the sectors the Group serves.
While the pandemic has impeded the Group’s short-term growth, the
second half of 2021 has shown the first signs of improvement, with
customer’s returning to normal service as well as a validation of early
indications of a consumer bounce-back with strong appetite for reli-
able and high-performance connectivity. This has been seen across
the Mobility segment as well as in Fixed Data, including interest in
ubiquitous rural connectivity, and in Government where connectivity
for morale, welfare and recreation has received renewed focus.
The overall revenue decrease versus prior year which can be directly
attributed to COVID-19 was € 22 million, all attributed to Networks.
• Video
For Video, the COVID-19 impact was not significant and was mainly
related to Sports & Events activities due to the cancellation or
postponement of some tournaments and events. However, year-on-
year revenues in this area are increasing again in 2021 versus prior
year reflecting the return of main tournaments in 2021.
• Networks
For Networks, a year-on-year reduction of € 22 million of revenue is
attributable to COVID-19, mainly driven by aero and maritime custom-
ers in the Mobility area.
In its business planning, which serves as a basis for the computation
of value-in-use amounts in the framework of impairment testing, the
revenue and cost projections have been adjusted to reflect the 2021
impact on the Group’s operating results of the pandemic and manage-
ment’s best estimate of a likely recovery profile based on the infor-
mation available at the time of the approval of those plans in Decem-
ber 2021.
RISK TO THE MEASUREMENT OF ASSETS AND
LIABILITIES
As noted above, the pandemic has impacted customers in both Video
and Networks operations and, in the early stages of the pandemic,
the Group worked constructively as a business partner with specific
customers to support their financial operations during the periods of
enforced restriction of their businesses whilst maintaining and
developing the respective business relationships for the longer term.
While the impact on the Group’s operating cash flow in 2020 was, in
aggregate circa € 72 million, the impact in 2021 was relatively insig-
nificant.
LIQUIDITY RISK
After a severe impact on credit spreads in 2020 due to the unknown
impact of COVID-19, credit spreads were favourable to investment
grade issuers throughout 2021, which has allowed SES to refinance
borrowings at favourable rates, as set out >> Note 23. While interest
rate increases are possible over the 2022-2024 time horizon, there is
currently no elevated refinancing risk for SES related to COVID-19.
SES ANNUAL REPORT 2021152
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
The Group manages its liquidity by monitoring the available cash
holdings and the forecast cash-flow projections for the business. As
of 31 December 2021, the Group has cash and cash equivalents of
€ 1,049 million, a solid contribution to the 2022 operational cash needs
of the Group. Phase 1 C-Band Accelerated Relocation Payments of
$ 391 million have been received in December 2021 and the remain-
ing $ 586 million in January 2022 >> Note 33 further bolstering liquid-
ity profile for 2022 and 2023. In addition, the Group has a revolving
credit facility for € 1,200 million in place until 2026 which is currently
undrawn. Together these sources of immediately available funds rep-
resent € 2,249 million.
The continuing strong operating cash flows, the current cash hold-
ings, including C-Band Phase 1 proceeds received in December 2021
and January 2022, the availability of the full revolving credit facility
and the continuing access to liquid debt markets indicate to manage-
ment that there is no significant liquidity risk for the Group at the date
of the issuance of these financial statements.
GOING CONCERN RISK
Based on the information presented above, management does not
believe that the impact on the Group’s activities is such that there is
any reason to cast doubt on the Group’s ability to continue as a going
concern or that there would be a material uncertainty in this regard.
NOTE 33 – C-BAND REPURPOSING
At its Open Commission Meeting held on 28 February 2020, the
Federal Communications Commission (‘FCC’) adopted a Report and
Order and Order of Proposed Modification (‘the FCC Order’) in con-
nection with the clearing of a 300 MHz band of C-band downlink
spectrum between 3,700 and 4,000 MHz by December 2025 to
support the rapid deployment of terrestrial 5G services in the contig-
uous United States (‘CONUS’).
On 26 May 2020, SES officially committed to an accelerated version
of the C-band clearing programme proposed in the FCC Order, which
aims at ensuring a faster deployment of 5G capabilities in the United
States. On 1 June 2020, the FCC’s Wireless Telecommunications
Bureau confirmed that a sufficient number of eligible space station
operators had filed similar accelerated relocation elections, triggering
the adoption of the accelerated programme pursuant to the schedule
set out below:
• Phase I: By 5 December 2021, SES will relocate all of its commercial
services out of the 3,700-3,820 MHz band over the CONUS. This
will require making equipment changes on all associated incum-
bent earth stations located in 46 of the top 50 Partial Economic
Areas, supplementing telemetry, tracking and control (“TT&C”)
operations to enhance two earth stations located in Hawley (Penn-
sylvania, U.S.A.) and Brewster (Washington, U.S.A.) and beginning
the consolidation of gateway services currently located at other
SES locations, as well as any customer or user gateway services, to
Hawley and / or Brewster.
•
Phase II: By 5 December 2023, SES will relocate all its CONUS
commercial services out of the full 3,700-4,000 MHz band, making
necessary equipment changes on all associated incumbent earth
stations located in all CONUS Partial Economic Areas, completing
its gateway consolidation to the Hawley and Brewster sites and
completing TT&C upgrades across SES teleports.
SES filed its Phase I Certification of Accelerated Relocation with the
FCC on 1 October 2021 and an amended certificate on 26 October
2021. The FCC validated the amended certificate on 24 November
2021, at which time the € 839 million ($ 977 million) of Accelerated
Relocation Payments were fully earned. SES received the Accelerated
Relocation Payments on 29 December 2021 and 3 January 2022.
The Group will receive a further $ 2,991 million (€ 2,641 million) for
Phase II if it successfully completes the clearing of the spectrum as
described above. In the case of delays in achieving the Phase II spec-
trum clearing milestone, then the Accelerated Relocation Payments
will decrease on a sliding scale to zero over the six-month period
beginning 5 December 2023.
The FCC held a public auction for the repurposed spectrum which
began on 8 December 2020 with the winning bidders being announced
on 24 February 2021.
To facilitate the clearing of the spectrum SES is procuring six C-band
satellites and launch vehicles and is consolidating and upgrading its
ground facilities to comply with the provisions of the FCC Order. In
parallel, customers and affiliated earth stations are being equipped
with special filters, new antennae and/or other technology capabili-
ties so that they can be migrated to work with services operating in
the remaining 200 MHz of spectrum (between 4,000 MHz and 4,200
MHz) available to satellite operators.
The SES Board of Directors approved an investment envelope of € 1.4
billion ($ 1.6 billion) for the implementation of the accelerated clearing
programme including the procurement and launch of the new
satellites and other equipment and services described above. SES
expects these spectrum clearing costs to be reimbursed by the Clear-
inghouse which is administering the transition and related payments
with FCC oversight.
SES ANNUAL REPORT 2021153
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
The C-band spectrum clearing operational activities are headed by a
member of the Group’s Senior Leadership Team supported by a team
of dedicated functional managers and full-time and part-time
resources. The financial impact of these operations is monitored as
part of the ongoing financial reporting to the Group’s management
and Board.
The C-band repurposing project is not the result of a contract with a
customer and therefore proceeds from the contract are not accounted
for as revenue under IFRS 15 – ‘Revenue from contracts with custom-
ers’, but rather as C-band repurposing income. The FCC is a U.S.
governmental agency that developed the rules of the auction, includ-
ing requiring the Group to clear the lower 300 MHz of C-band spec-
trum and requiring overlay license auction winners to reimburse the
Group for reasonable relocation costs and pay the Group accelerated
relocation payments if earned in accordance with the FCC Order. In
consideration of the substance of the FCC’s rulemaking, the Group
believes the payments the FCC requires auction winners to make to
the Group are akin to a government grant. Accordingly, the Group is
applying the requirements of IAS 20 (‘Accounting for Government
Grants and Disclosure of Government Assistance’) to account for the
C-band repurposing income related to reimbursements of reasonable
relocation costs and accelerated relocation payments.
For capitalised costs related to the procurement of the C-band sat-
ellites, launches, and upgraded ground facilities, the Group records
credits to the recorded book values of the related asset when the
costs have been incurred and the Group has obtained reasonable
assurance that the costs will be reimbursed and that it will comply
with the requirements attached to the reimbursement. The costs and
expected reimbursements recorded in the consolidated statement of
financial position under “Assets in the course of construction”
>> Note 13 are presented in the table below:
Assets in the course of construction
€ MILLION
Space
segment
Ground
segment Total
Cost as at 1 January 2021 316 8 324
Additions 309 28 337
Impact of currency translation 43 1 44
Cost as at 31 December 2021
668 37 705
Expected reimbursements as
at 1 January 2021 (11) – (11)
Additions (642) (36) (678)
Impact of currency translation (15) (1) (16)
Expected reimbursements as
at 31 December 2021 (668) (37) (705)
Net balance as
at 31 December 2021 – – –
In 2021 the Group expended € 337 million of capital expenditures
which have been fully offset by expected reimbursements as per the
above. Additionally, as per >> Note 13, the Group reclassified € 313
million of assets under construction to other receivables due to the
expected reimbursements.
The Group records operating expenses as incurred for both equip-
ment transferred to customers and affiliated earth stations to facili-
tate their migration to the upper 200 MHz of the C-band and other
associated spectrum clearing costs. The Group records C-band repur-
posing reimbursement income related to these expenses when the
expenses have been incurred and the Group has obtained reasonable
assurance that the costs will be reimbursed and that it will comply
with the requirements attached to the reimbursement.
In both cases, the Group believes it obtains such reasonable assur-
ance when either the Clearinghouse validates the costs as being reim-
bursable or the costs fall within cost ranges for the applicable costs
as published by the FCC in a cost catalogue.
In 2021 the Group recorded C-band repurposing income of € 901 mil-
lion (2020: € 10 million) including € 839 million of accelerated relo-
cation payments recognised pursuant to the FCC’s confirmation of
Phase 1 completion. C-band-related expenses of € 122 million (2020:
€ 43 million) represent cost of sales of € 51 million (2020: € 12 mil-
lion), accumulated staff costs of € 36 million (2020: € 15 million) and
other operating expenses (including travel and consulting charges)
of € 35 million (2020: € 16 million).
As at 31 December 2021, in connection with the accelerated reloca-
tion payments, operating expenses, and capital expenditures above,
the Group has other receivables of € 1,273 million (2020: € 21 million)
related to the C-band repurposing project >> Note 16.
Once the accelerated clearing programme had been confirmed, the
Group began the amortisation of the remaining balance of deferred
charges in connection with the C-band repurposing of € 10 million
(31 December 2020: € 14 million). These deferred charges, which are
presented under ‘Prepayments’ in the Statement of Financial Position
are to be amortised on a straight-line basis through to the completion
of Phase II in December 2023.
SES has entered into procurement agreements with three satellite
manufacturers to acquire the six satellites needed to facilitate the
repurposing of the C-band spectrum representing an aggregate com-
mitment of € 755 million, out of which € 655 million (2020: € 313 mil-
lion) is presented under non-current ‘Fixed assets suppliers’ in the
consolidated statement of financial position >> Note 27.
SES’s other commitments for C-band repurposing expenditures rep-
resent € 8 million (2020: € 52 million).
SES ANNUAL REPORT 2021154
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 34 – POST-BALANCE SHEET EVENTS
Management notes the recent developments in the Ukraine, and the
sanctions being imposed on Russia by many countries as a result.
Given the Group’s limited direct activities in the region, management’s
view is that these developments and sanctions are unlikely to have a
significant direct adverse impact on the financial results of the Group
going forward. Nonetheless, since the situation continues to evolve it
remains difficult at this stage to estimate all the direct and indirect
impacts which may arise from these emerging developments. Manage-
ment continues to monitor the developments closely and to take all
necessary actions.
There have been no other material events occurring between the
reporting date and the date when the consolidated financial state
-
ments were authorised by the Board of Directors.
NOTE 35 – ALTERNATIVE PERFORMANCE
MEASURES
SES regularly uses alternative performance measures to present the
performance of the Group.
These measures may not be comparable to similarly titled measures
used by other companies and are not measurements under IFRS or
any other body of generally accepted accounting principles, and thus
should not be considered substitutes for the information contained
in the Group’s financial statements.
1) Net debt
Net debt is defined as current and non-current borrowings less cash
and cash equivalents, all as disclosed on the consolidated statement
of financial position. The Group believes that net debt is relevant to
investors, since it gives an indication of the absolute level of non- equity
funding of the business. This can be compared to the income and cash
flows generated by the business, and available undrawn facilities.
The following table reconciles net debt to the relevant balance sheet
line items:
Net Debt
€ MILLION 2021 2020
Borrowings – non-current 3,524 3,317
Borrowings – current 57 613
Borrowings, less 3,581 3,930
Cash and equivalents 1,049 1,162
Net debt
2,532 2,768
2) EBITDA and EBITDA margin
EBITDA is defined as profit for the period before the impact of
depreciation, amortisation, net financing cost and income tax. EBITDA
Margin is defined as EBITDA divided by the sum of revenue and
C-band repurposing income. The Group believes that EBITDA and
EBITDA margin are useful supplemental indicators that may be used
to assist in evaluating a Company’s operating performance.
The following table reconciles EBITDA to the consolidated income
statement line items from which it is derived:
EBITDA
€ MILLION 2021 2020
Profit/(loss) before tax 397 (102)
Add: Depreciation and impairment expense 626 808
Add: Amortisation and impairment expense 768 189
Add: Net financing costs 71 184
EBITDA
1,862 1,079
The following table provides a reconciliation of EBITDA margin:
EBITDA Margin
€ MILLION 2021 2020
Revenue 1,782 1,876
C-band repurposing income 901 10
EBITDA 1,862 1,079
EBITDA Margin (%)
69.4% 57.2%
3) Adjusted EBITDA and Adjusted EBITDA margin
Adjusted EBITDA is defined as EBITDA adjusted to exclude signifi-
cant special items. Significant special items exceeding the threshold
of € 5 million at first recognition need to be approved by management
and primarily consist of restructuring charges announced in the
framework of the Group’s ‘Simplify and Amplify’ programme, and other
special factors or distortions linked to the C-band repurposing.
Adjusted EBITDA
€ MILLION 2021 2020
EBITDA 1,862 1,079
Deduct: C-Band repurposing income (>> Note 33) (901) (10)
Add: C-Band repurposing expenses (>> Note 33) 122 43
Add: Restructuring expenses (>> Note 24) 8 40
Adjusted EBITDA
1,091 1,152
Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by
revenue. The following table provides a reconciliation of the Adjusted
EBITDA Margin:
Adjusted EBITDA Margin
€ MILLION 2021 2020
Revenue 1,782 1,876
Adjusted EBITDA 1,091 1,152
Adjusted EBITDA Margin (%)
61.2% 61.4%
SES ANNUAL REPORT 2021155
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
4) Operating profit and operating profit margin
Operating profit is defined as profit for the year before the impact of
net financing charges, income tax, the Group’s share of the results of
associates and includes any extraordinary line item between revenue
and profit before tax in the Group’s consolidated income statement.
The Group uses operating profit to monitor its financial return after
both operating expenses and a charge representing the cost of usage
of both its property, plant and equipment and definite-life intangible
assets.
The following table reconciles operating profit to the income state-
ment line items from which it is derived:
Operating Profit
€ MILLION 2021 2020
Profit/(loss) before tax 397 (102)
Add: Net financing costs 71 184
Operating profit
468 82
Operating profit margin is defined as operating profit as a percentage
of revenue. SES believes that operating profit margin is a useful
measure to demonstrate the proportion of revenue that has been
realised as operating profit, and therefore an indicator of profitability.
The following table provides a reconciliation of the operating profit
margin:
Operating Profit Margin
€ MILLION 2021 2020
Revenue 1,782 1,876
Operating profit 468 82
Operating profit margin
26.3% 4.4%
5) Adjusted Net Debt
Adjusted Net Debt is defined as current and non-current borrowings
less cash and cash equivalents, all as disclosed on the consolidated
financial position and also includes 50% of the Group’s € 1.3 billion of
the perpetual bonds (consistent with rating agencies’ methodology).
The Group believes that Adjusted Net Debt is relevant to investors,
since it gives an indication of the absolute level of non-equity funding
of the business. This can be compared to the income and cash flows
generated by the business, and available undrawn facilities.
The following table reconciles Adjusted Net Debt to the relevant line
items on the statement of financial position from which it is derived:
Adjusted Net Debt
€ MILLION 2021 2020
Borrowings – non-current 3,524 3,317
Borrowings – current 57 613
Total borrowings 3,581 3,930
50% of the Group’s € 1.2 billion
(2020: € 1.3 billion) of perpetual bonds 588 650
Less: Cash and cash equivalents 1,049 1,162
Adjusted Net Debt
3,120 3,418
6) Adjusted EBITDA ratio
The Adjusted Net Debt to Adjusted EBITDA ratio is defined as
Adjusted Net Debt divided by Adjusted EBITDA. The Group believes
that the Adjusted Net Debt to Adjusted EBITDA ratio is a useful meas-
ure to demonstrate to investors its ability to generate the recurring
income needed to be able to settle its loans and borrowings as they
fall due.
Adjusted Net Debt to Adjusted EBITDA ratio
€ MILLION 2021 2020
Adjusted Net Debt 3,120 3,418
Adjusted EBITDA 1,091 1,152
Adjusted Net debt to Adjusted EBITDA ratio
2.86 times 2.97 times
7) Adjusted Net Profit and Adjusted Earnings per Share
Adjusted Net Profit is defined as profit or loss of the period attribut-
able to shareholders of the group adjusted to exclude the after-tax
impact of significant special items. Significant special items exceed-
ing the threshold of € 5 million on first recognition, need to be
approved by management and primarily consist of restructuring
charges announced in the framework of the Group’s ‘Simplify and
Amplify’ programme, and other special factors or distortions linked to
the C-band repurposing, as well as the impairment expenses, includ-
ing the tax impact of impairment charges on shareholdings arising at
SES S.A. or at the subsidiary level.
The tax rate applied to the pre-tax impact of the C-band operating
expenses is the US tax rate and the tax rate applied to the restruc-
turing expenses and impairment expenses represents the computed
weighted average tax rate of the jurisdictions where the expenses
occurred:
SES ANNUAL REPORT 2021156
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Adjusted Net Profit
€ MILLION 2021 2020
Profit/ (loss) of the group attributable to share-
holders of the parent 453 (86)
C-band net of income / operating expenses (779) 33
Restructuring expenses 8 40
Impairment expenses 724 277
(Less)/Add: Total significant special items (47) 350
Tax on C-Band operating expenses
(net of income), at 21% 164 (7)
Tax on restructuring expenses, at 24%
(2020: 22%) (2) (9)
Tax on impairment expenses, at 1.8%
(2020: 14.4%) (13) (40)
Add/(Less): Tax on significant special items 149 (56)
Less: Tax benefit in respect of impairment
expenses on the carrying value of subsidiary
investments and other assets eliminated at
consolidation level (232) (17)
Adjusted Net Profit
323 191
Adjusted Earnings per Share is the reported earnings share adjusted
for the after-tax impact of significant special items as described
above. For the year 2021, Adjusted Earnings per Share of € 0.63 per
Class A share (2020: € 0.31), and € 0.25 per Class B share (2020:
€ 0.13) have been calculated on the following basis:
Adjusted Earnings for computation
of adjusted earnings per share
€ MILLION 2021 2020
Adjusted Net Profit 323 191
Assumed coupon on perpetual bond (net of tax) (41) (49)
Total
282 142
The weighted average number of shares, net of own shares held, for
calculating Adjusted Earnings per Share – unchanged from the num-
bers of shares applied in the calculation of basic earnings per share:
Weighted average number of shares
€ 2021 2020
Class A shares (in million) 369.7 378.4
Class B shares (in million) 189.2 191.7
Total
558.9 570.1
Adjusted Earnings per Share
€ 2021 2020
Class A shares 0.63 0.31
Class B shares
0.25 0.13
8) Free cash flow before dividend and treasury activities
Free cash flow before financing activities is defined as net cash
generated by operating activities, adjusted for the net cash absorbed
by investing activities. In addition, free cash flow before dividend and
treasury activities considers the effect of the coupon paid on per-
petual bond, interest paid on borrowings and lease payments on the
computed free cash flow before financing activities. The Group
believes that the free cash flow before dividend and treasury activities
is relevant to the investors, since it gives an indication of the Group’s
ability to generate cash after payment taxes and other committed
financing charges.
Free Cash Flow
€ MILLION 2021 2020
Net cash generated by operating activities 1,294 1,049
Net cash absorbed by investing activities (283) (217)
Free cash flow before financing activities 1,011 832
Interest paid on borrowings (121) (152)
Lease payments (14) (15)
Free cash flow before equity distributions and
treasury activities
876 665
SES ANNUAL REPORT 2021157
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 36 – CONSOLIDATED SUBSIDIARIES,
ASSOCIATES
The consolidated financial statements include the financial state-
ments of the Group’s subsidiaries and associates listed below:
Group’s Subsidiaries and Associates
Economic interest (%) Method of consolidation
2021 2020 2021 2020
SES ASTRA S.A., Luxembourg 100 100 Full Full
SES Global-Americas Inc., U.S.A. 100 100 Full Full
SES Global Americas Holdings General Partnership, U.S.A. 100 100 Full Full
SES Participations S.A., Luxembourg 100 100 Full Full
SES Finance S.à r.l., Luxembourg 100 100 Full Full
SES Holdings (Netherlands) B.V., Netherlands 100 100 Full Full
SES Astra Services Europe S.à r.l., Luxembourg
3
100 100 Full Full
SES Latin America S.à r.l., Luxembourg
3
100 100 Full Full
SES Belgium S.p.r.l, Belgium
2
– 100 – Full
SES Insurance International (Luxembourg) S.A., Luxembourg 100 100 Full Full
SES Insurance International Re (Luxembourg) S.A., Luxembourg 100 100 Full Full
SES Networks Lux S.à r.l., Luxembourg 100 100 Full Full
Ciel Satellite Holdings Inc., Canada
2
– 100 – Full
Ciel Satellite Limited Partnership, Canada
2
– 100 – Full
Northern Americas Satellite Ventures, Inc., Canada 100 100 Full Full
SES TechCom S.A., Luxembourg 100 100 Full Full
Redu Operations Services S.A., Belgium 48 48 Equity Equity
Redu Space Services S.A., Belgium 52 52 Full Full
HD Plus GmbH, Germany 100 100 Full Full
SES Germany GmbH, Germany 100 100 Full Full
SES Media Solutions GmbH, Germany 100 100 Full Full
MX1 (Thailand) Ltd, Thailand
2
100 100 Full Full
PT MX1 Smartcast Indonesia, Indonesia 100 100 Full Full
ASTRA Deutschland GmbH, Germany 100 100 Full Full
SES ASTRA Iberica S.A., Spain
2
– 100 – Full
Group’s Subsidiaries and Associates
Economic interest (%) Method of consolidation
2021 2020 2021 2020
ASTRA France S.A., France 100 100 Full Full
ASTRA (GB) Limited, United Kingdom 100 100 Full Full
ASTRA CEE Sp. z o.o, Poland
2
100 100 Full Full
SES ASTRA (Romania) S.r.l., Romania 100 100 Full Full
SES HD Plus Ghana Limited Company), Ghana 84.7 84.7 Full Full
SES ENGINEERING (Luxembourg) S.à r.l., Luxembourg 100 100 Full Full
SES ASTRA AB, Sweden 100 100 Full Full
Sirius Satellite Services SIA, Latvia 100 100 Full Full
SES SIRIUS Ukraina, Ukraine 100 100 Full Full
SES-10 S.à r.l., Luxembourg 100 100 Full Full
LuxGovSat S.A., Luxembourg 50 50 Full Full
SES Satellite Leasing Ltd, Isle of Man
2
100 100 Full Full
Al Maisan Satellite Communications Company LLC, UAE 35 35 Full Full
Satellites Ventures (Bermuda) Ltd, Bermuda 50 50 Full Full
SES ASTRA Africa Proprietary Limited, South Africa 100 100 Full Full
SES AMERICOM Inc., U.S.A. 100 100 Full Full
SES Telecomunicações do Brasil Ltda., Brazil 100 100 Full Full
SES Government Solutions, Inc., U.S.A. 100 100 Full Full
Sistemas Satelitales de Mexico, S. de R.L. de C.V., Mexico 100 100 Full Full
SES Telecommunicaciones de Mexico S. de R.L. de C.V., Mexico 100 100 Full Full
SES Satellites International, LLC, U.S.A. 100 100 Full Full
SES Satellites (Gibraltar) Ltd., Gibraltar 100 100 Full Full
SES AMERICOM (Asia 1A) LLC, U.S.A. 100 100 Full Full
AMERICOM Asia Pacific LLC, U.S.A. 100 100 Full Full
QuetzSat Directo S. de R.L. de C.V., Mexico 100 100 Full Full
SES Engineering (US) Inc., U.S.A. 100 100 Full Full
SES ANNUAL REPORT 2021158
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Group’s Subsidiaries and Associates
Economic interest (%) Method of consolidation
2021 2020 2021 2020
AOS Inc., U.S.A.
2
– 100 – Full
QuetzSat S. de R.L. de C.V., Mexico 100 100 Full Full
Satelites Globales S. de R.L. de C.V., Mexico 100 100 Full Full
SES Satelites Directo Ltda, Brazil
100 100 Full Full
SES DTH do Brasil Ltda, Brazil 100 100 Full Full
SES Satélites Ibérica, S.L. (formerly SES Global South America
Holding, S.L.), Spain 100 100 Full Full
New Skies Satellites B.V., The Netherlands 100 100 Full Full
SES Engineering (Netherlands) B.V., The Netherlands
100 100 Full Full
New Skies Satellites, LLC, U.S.A. 100 100 Full Full
New Skies Satellites Mar B.V., The Netherlands 100 100 Full Full
New Skies Satellites Ltda, Brazil 100 100 Full Full
SES New Skies Marketing B.V., The Netherlands 100 100 Full Full
New Skies Satellites Argentina B.V., The Netherlands 100 100 Full Full
New Skies Satellites Australia Pty Ltd, Australia 100 100 Full Full
New Skies Satellites Licensee B.V., The Netherlands 100 100 Full Full
SES Asia S.à r.l., Luxembourg
3
100 100 Full Full
SES Finance Services AG, Switzerland 100 100 Full Full
SES World Skies Singapore Pte Ltd, Singapore 100 100 Full Full
O3b Networks Limited, Jersey, Channel Islands 100 100 Full Full
O3b Limited, Jersey, Channel Islands 100 100 Full Full
O3b Africa Limited, Mauritius
2
100 100 Full Full
O3b Sales B.V., The Netherlands 100 100 Full Full
O3b Networks USA LLC, U.S.A. 100 100 Full Full
O3b Teleport Services (Australia) Pty Limited, Australia 100 100 Full Full
O3b Teleport Serviços (Brasil) Ltda, Brasil 100 100 Full Full
O3b Networks (Brasil) Ltda, Brasil 100 100 Full Full
O3b Services (Portugal) Ltda, Portugal 100 100 Full Full
O3b Teleport Services (Peru) SAC, Peru 100 100 Full Full
SES mPOWER S.à r.l., Luxembourg 100 100 Full Full
SES Networks Satellites S.à r.l., Luxembourg 100 100 Full Full
Group’s Subsidiaries and Associates
Economic interest (%) Method of consolidation
2021 2020 2021 2020
West Africa Platform Services Ltd, Ghana 49 49 Full Full
MX1 Ltd, Israel 100 100 Full Full
MX1 LLC, U.S.A.
4
100 100 Full Full
GSN GoSat Distribution Network Ltd, Cyprus
2
100 100 Full Full
EMP Media Port Ltd, Cyprus
2
100 100 Full Full
SES Services Romania S.R.L., Romania 100 100 Full Full
MX1 Korea Ltd., Korea
2
– 100 – Full
SES-17 S.à r.l., Luxembourg 100 100 Full Full
SES Defence UK Ltd, United Kingdom 100 100 Full Full
SES Techcom Afrique S.A. S.U., Burkina Faso 100 100 Full Full
SES Satellite Nigeria Limited, Nigeria 100 100 Full Full
SES Networks GmbH, Germany 100 100 Full Full
SES Satellites India Private Limited, India 100 100 Full Full
SES 5G Customer Services LLC, U.S.A. 100 100 Full Full
SES US Satellite Holdings LLC, U.S.A. 100 100 Full Full
SES Telecomunicaciones de Colombia S.A.S., Colombia 100 100 Full Full
SES Telecomunicaciones de Colombia Zona Franca S.A.S.,
Colombia
2
100 100 Full Full
SES Telecomunicaciones de Chile SpA, Chile 100 100 Full Full
SES LU Satellite Holdings S.à r.l., Luxembourg 100 100 Full Full
Luxembourg Space Sector Development General Partner S.à r.l,
Luxembourg
1
100 – Full –
Luxembourg Space Sector Development SCSp, Luxembourg
1
50 – Full –
SES LU US Holdings S.à r.l, Luxembourg
1
100 – Full –
1 Entity created in 2021
2 Entity sold, merged, liquidated, or merger or liquidation process initiated, in 2021
3 Change in legal form of entity in 2021 from S.A. to S.à r.l.
4 Change in legal form of entity in 2021 from Inc to LLC.
.
SES ANNUAL REPORT 2021160
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
AUDIT REPORT
To the Shareholders of SES S.A.
REPORT ON THE AUDIT OF
THE ANNUAL ACCOUNTS
OUR OPINION
In our opinion, the accompanying annual accounts give a true and fair
view of the financial position of SES S.A. (the “Company”) as at
31 December 2021, and of the results of its operations for the year
then ended in accordance with Luxembourg legal and regulatory
requirements relating to the preparation and presentation of the
annual accounts.
Our opinion is consistent with our additional report to the Audit and
Risk Committee.
What we have audited
The Company’s annual accounts comprise:
• the balance sheet as at 31 December 2021;
• the profit and loss account for the year then ended;
• the statement of changes in shareholders’ equity as at 31 Decem-
ber 2021; and
• the notes to the annual accounts, which include a summary of sig-
nificant accounting policies.
BASIS FOR OPINION
We conducted our audit in accordance with the EU Regulation
No 537/2014, the Law of 23 July 2016 on the audit profession (Law of
23 July 2016) and with International Standards on Auditing (ISAs)
as adopted for Luxembourg by the “Commission de Surveillance du
Secteur Financier” (CSSF). Our responsibilities under the EU Regulation
No 537/2014, the Law of 23 July 2016 and ISAs as adopted for
Luxembourg by the CSSF are further described in the “Responsibilities
of the “Réviseur d’entreprises agréé” for the audit of the annual
accounts” section of our report.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
We are independent of the Company in accordance with the Inter-
national Code of Ethics for Professional Accountants, including
International Independence Standards, issued by the International
Ethics Standards Board for Accountants (IESBA Code) as adopted
for Luxembourg by the CSSF together with the ethical requirements
that are relevant to our audit of the annual accounts. We have fulfilled
our other ethical responsibilities under those ethical requirements.
To the best of our knowledge and belief, we declare that we have not
provided non-audit services that are prohibited under Article 5(1) of
the EU Regulation No 537/2014.
The non-audit services that we have provided to the Company and
its controlled undertakings, if applicable, for the year then ended, are
disclosed in Note 19 to the annual accounts.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judg-
ment, were of most significance in our audit of the annual accounts
of the current period. These matters were addressed in the context
of our audit of the annual accounts as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these
matters.
Valuation of the shares in affiliated undertakings
The Company has investments in shares in affiliated undertakings in
net amount of 5,032 million EUR (see >> Note 3), which includes
2,187 million EUR of value adjustments recorded during the year then
ended.
Management’s assessment of the recoverable amount of investments
in subsidiaries requires significant judgement in the determination of
the level at which the investments in affiliated undertakings are tested
for impairment taking into account the substance of the business
activity, interdependency of the cash flows between the different
subsidiaries and their level of integration.
Moreover, the determination of the recoverable value requires
significant estimates as it relates to the estimation of the forecasted
cash flows and of the discount rates and long-term growth rates.
We focused on this area due to the inherent complexity and judge-
ment in the estimate for the recoverable amount of the investments
in affiliated undertakings and the materiality of the balance.
How our audit addressed the key audit matter
PricewaterhouseCoopers, Société coopérative, 2 rue Gerhard Mercator, B.P. 1443, L-1014 Luxembourg, T : +352 494848 1, F : +352 494848 2900, www.pwc.lu
Cabinet de révision agréé. Expert-comptable (autorisation gouvernementale n°10028256) R.C.S. Luxembourg B 65 477 - TVA LU25482518
SES ANNUAL REPORT 2021161
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
•
We tested the design and implementation of relevant internal
controls;
•
We evaluated Management’s methodology used to estimate the
recoverable amount of the investments in affiliated undertakings.
To that effect, we noted that Management has grouped certain
undertakings together for the purposes of testing them for impair-
ment in order to appropriately reflect the substance of the activity,
interdependency of cash flows and the level of integration of their
operations;
•
We evaluated, where Management planned a divestiture/restruc-
turing at undertaking level, the impact on the recoverable amount
determined at the individual affiliated undertaking level;
• When Management has grouped certain undertakings together for
the purposes of testing them for impairment, we involved valuation
specialists and independently recalculated the weighted average
cost of capital based on the use of market date and challenged the
long-term growth rate applied based on market data;
• We agreed the forecasted cash flows used for the determination of
the recoverable value to the 2022 Business Plan as approved by
the Board of Directors;
•
We evaluated the forecasted revenue and costs assumptions,
considering our expectations in terms of significant developments
during the forecast period (significant new contracts or loss
thereof) and corroborated these with market data in respect of
demand for satellite capacity and pricing;
•
We evaluated the capital expenditure assumptions, considering
our expectations in terms of significant developments during the
forecast period (capital expenditure programs, replacement of
satellites) and the expected capital expenditure level in terminal
period in order to maintain the current assets base;
• We performed sensitivity analysis of the models to changes in the
key assumptions;
• When Management has undertaken the testing for impairment at
individual affiliated undertaking level, we have obtained the related
independent valuation reports and evaluated the related value
adjustment calculations where required;
• We considered the appropriateness of the disclosures in >> Note 3
to the annual accounts.
OTHER INFORMATION
The Board of Directors is responsible for the other information. The
other information comprises the information stated in the manage-
ment report and the Corporate Governance Statement but does not
include the annual accounts and our audit report thereon.
Our opinion on the annual accounts does not cover the other infor-
mation and we do not express any form of assurance conclusion
thereon.
In connection with our audit of the annual accounts, our responsibility
is to read the other information identified above and, in doing so,
consider whether the other information is materially inconsistent with
the annual accounts or our knowledge obtained in the audit, or other-
wise appears to be materially misstated. If, based on the work we have
performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing
to report in this regard.
RESPONSIBILITIES OF THE BOARD OF DIRECTORS
AND THOSE CHARGED WITH GOVERNANCE FOR
THE ANNUAL ACCOUNTS
The Board of Directors is responsible for the preparation and fair
presentation of the annual accounts in accordance with Luxembourg
legal and regulatory requirements relating to the preparation and
presentation of the annual accounts, and for such internal control as
the Board of Directors determines is necessary to enable the pre-
paration of annual accounts that are free from material misstatement,
whether due to fraud or error.
In preparing the annual accounts, the Board of Directors is responsible
for assessing the Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the Board of Directors
either intends to liquidate the Company or to cease operations, or has
no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the
Company’s financial reporting process.
The Board of Directors is responsible for presenting the annual
accounts in compliance with the requirements set out in the Dele-
gated Regulation 2019/815 on European Single Electronic Format
(“ESEF Regulation”).
SES ANNUAL REPORT 2021162
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
RESPONSIBILITIES OF THE “RÉVISEUR D’ENTRE-
PRISES AGRÉÉ” FOR THE AUDIT OF THE ANNUAL
ACCOUNTS
The objectives of our audit are to obtain reasonable assurance about
whether the annual accounts as a whole are free from material mis-
statement, whether due to fraud or error, and to issue an audit report
that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accord-
ance with the EU Regulation No 537/2014, the Law of 23 July 2016
and with ISAs as adopted for Luxembourg by the CSSF will always
detect a material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if, individually or
in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these annual
accounts.
As part of an audit in accordance with the EU Regulation No 537/2014,
the Law of 23 July 2016 and with ISAs as adopted for Luxembourg by
the CSSF, we exercise professional judgment and maintain profes-
sional scepticism throughout the audit. We also:
•
identify and assess the risks of material misstatement of the annual
accounts, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations,
or the override of internal control;
• obtain an understanding of internal control relevant to the audit
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Company’s internal control;
• evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures
made by the Board of Directors;
• conclude on the appropriateness of the Board of Directors’ use of
the going concern basis of accounting and, based on the audit evi-
dence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Com-
pany’s ability to continue as a going concern. If we conclude that
a material uncertainty exists, we are required to draw attention in
our audit report to the related disclosures in the annual accounts
or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the
date of our audit report. However, future events or conditions may
cause the Company to cease to continue as a going concern;
•
evaluate the overall presentation, structure and content of the
annual accounts, including the disclosures, and whether the annual
accounts represent the underlying transactions and events in a
manner that achieves fair presentation.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that
we have complied with relevant ethical requirements regarding inde-
pendence, and communicate to them all relationships and other mat-
ters that may reasonably be thought to bear on our independence,
and where applicable, actions taken to eliminate threats or safeguards
applied.
From the matters communicated with those charged with governance,
we determine those matters that were of most significance in the audit
of the annual accounts of the current period and are therefore the
key audit matters. We describe these matters in our audit report
unless law or regulation precludes public disclosure about the matter.
We assess whether the annual accounts have been prepared, in all
material respects, in compliance with the requirements laid down in
the ESEF Regulation.
REPORT ON OTHER LEGAL AND REGULATORY
REQUIREMENTS
The management report is consistent with the annual accounts and
has been prepared in accordance with applicable legal requirements.
The Corporate Governance Statement is included in the management
report. The information required by Article 68ter Paragraph (1) Let-
ters c) and d) of the Law of 19 December 2002 on the commercial
and companies register and on the accounting records and annual
accounts of undertakings, as amended, is consistent with the annual
accounts and has been prepared in accordance with applicable legal
requirements.
We have been appointed as “Réviseur d’Entreprises Agréé” by the
General Meeting of the Shareholders on 1 April 2021 and the duration
of our uninterrupted engagement, including previous renewals and
reappointments, is 9 years.
We have checked the compliance of the annual accounts of the Com
-
pany as at 31 December 2021 with relevant statutory requirements
set out in the ESEF Regulation that are applicable to annual accounts.
For the Company it relates to the requirement that annual accounts
are prepared in a valid XHTML format.
In our opinion, the annual accounts of the Company as at 31 Decem-
ber 2021, identified as “SES Annual report -2021-12-31-en”, have been
prepared, in all material respects, in compliance with the requirements
laid down in the ESEF Regulation.
PricewaterhouseCoopers, Société coopérative
Represented by
François Mousel Luxembourg, 2 March 2022
SES ANNUAL REPORT 2021163
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
BALANCE SHEET
As at 31 December 2021
Liabilities
EUR MILLION Note 2021 2020
Capital and reserves
Subscribed capital 6 719.0 719.0
Share premium account 1,890.2 1,890.2
Reserves
Legal reserve
7 71.9 71.9
Reserve for own shares
8 54.0 35.1
Profit brought forward 2,776.8 2,471.0
Profit for the financial year (428.7) 508.8
5,083.2 5,696.0
Creditors
2.2.8
Debenture loans - Non convertible loans 9
becoming due and payable within one year 65.9 669.3
becoming due and payable after more than one year 4,639.4 4,512.4
Amounts owed to credit institutions
9
becoming due and payable within one year 40.2 40.7
becoming due and payable after more than one year – 40.2
Trade creditors
becoming due and payable within one year 1.0 0.7
Amounts owed to affiliated undertakings
9
becoming due and payable within one year 1,626.8 1,423.5
becoming due and payable after more than one year 587.3 614.7
Other creditors
Tax authorities
10 – 0.3
Social security authorities 0.4 0.5
Other creditors
11
becoming due and payable within one year 711.8 4.8
payable after more than one year 277.6 764.1
7,950.4 8,071.2
Total liabilities (Capital, Reserves, Liabilities)
13,033.6 13,767.2
The accompanying notes form an integral part of the annual accounts.
Assets
EUR MILLION Note 2021 2020
Fixed Assets
Intangible assets
0.4 0.7
Payments on account and intangible assets under development
2.2.1 4.1 –
Financial assets
2.2.2, 3
Shares in affiliated undertakings
3 a 5,032.0 7,171.0
Loans to affiliated undertakings
3 b 3,252.7 3,430.5
8,289.2 10,602.2
Current Assets
Debtors
2.2.6
Amounts owed by affiliated undertakings
becoming due and payable within one year
4 a 3,416.3 1,288.4
becoming due and payable after one year
4 a 287.1 773.5
Other debtors
becoming due and payable within one year
4 b 16.6 1.7
Investments
Own shares
2.2.3, 5 54.0 35.1
Cash at bank and cash in hand
935.1 1,020.6
4,709.1 3,119.3
Prepayments
2.2.4 35.3 45.7
Total assets
13,033.6 13,767.2
The accompanying notes form an integral part of the annual accounts.
SES ANNUAL REPORT 2021164
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
PROFIT AND LOSS ACCOUNT
For the year ended 31 December 2021
Profit and Loss Account
EUR MILLION Note 2021 2020
Interest payable and similar expenses
concerning affiliated undertakings
18 a (29.5) (28.5)
other interest and similar expenses
18 b (375.0) (437.9)
Tax on profit or loss (0.4) –
Other tax not shown under the previous items
– (0.2)
Profit or loss for the financial year (428.7) 508.8
The accompanying notes form an integral part of the annual accounts.
Profit and Loss Account
EUR MILLION Note 2021 2020
Other operating income
12 27.3 18.5
Raw material and consumables and other external expenses
Other external expenses
12 (28.8) (34.0)
Staff costs
13
Wages and salaries (15.6) (15.2)
Social security costs
relating to pensions (1.7) (1.5)
other social security costs
(0.6) (0.2)
Other staff costs
(0.1) (0.2)
Other operating expenses
(3.0) (6.0)
Income from participating interest
derived from affiliated undertakings 2.2.5, 14 1,896.8 959.0
Income from other investments and loans forming part of fixed assets
derived from affiliated undertakings 15 85.0 98.9
Other interest receivable and similar income
derived from affiliated undertakings 16 a 40.5 32.3
other interest and similar income
16 b 228.6 164.0
Value adjustment in respect of financial assets and of investments held as
current assets 17 (2,252.2) (240.2)
SES ANNUAL REPORT 2021165
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
As at 31 December 2021
Statement of Changes in Shareholders’ Equity
EUR MILLION Subscribed capital Share premium Legal reserve Other reserves* Result for the year Total
At 1 January 2020 719.0 1,890.2 71.9 2,180.4 509.8 5,371.3
Allocation of result – – – 509.8 (509.8) –
Distribution of dividends – – – (184.1) – (184.1)
Other movements – – – – – –
Profit for the financial year – – – – 508.8 508.8
At 31 December 2020
719.0 1,890.2 71.9 2,506.1 508.8 5,696.0
At 1 January 2021 719.0 1,890.2 71.9 2,506.1 508.8 5,696.0
Allocation of result – – – 508.8 (508.8) –
Distribution of dividends – – – (184.1) – (184.1)
Profit for the financial year – – – – (428.7) (428.7)
At 31 December 2021
719.0 1,890.2 71.9 2,830.8 (428.7) 5,083.2
* Including reserves for own shares, other non available reserves and profit brought forward.
The accompanying notes form an integral part of the annual accounts.
SES ANNUAL REPORT 2021166
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTES TO THE
ANNUAL ACCOUNTS
As at 31 December 2021
NOTE 1 – GENERAL INFORMATION
SES S.A. (hereafter ‘SES’ or ‘the Company’) was incorporated on
16 March 2001 as a limited liability company (Société Anonyme) under
the laws of the Grand-Duchy of Luxembourg for an unlimited period.
The registered office of the Company is established at the Château
de Betzdorf, L-6815 Betzdorf, Luxembourg.
The purpose of the Company is to take generally any interest what-
soever in electronic media and to be active, more particularly, in the
communications area via satellites and to invest, directly or indirectly,
in other companies that are actively involved in the satellite commu-
nication industry.
The accounting period of the Company is from 1 January to 31 December.
The Company has a 99.94% interest in a partnership, SES Global
Americas Holdings GP, whose accounts are integrated into those of
the Company to the level of its share in the partnership.
The Company prepares consolidated financial statements for the
SES Group which are drawn up in accordance with International
Financial Reporting Standards as endorsed by the European Union
(‘IFRS’) and are published according to the provisions of the Luxem-
bourg law.
Article 65, Paragraph (1) 2º of the Law of 19 December 2002 on the
register of commerce and companies and the accounting and
annual accounts of undertakings (the “Law”) requires the disclo-
sure of the amount of capital and reserves and profit and loss for
the last financial year of each affiliated undertaking. In conformity
with Art.67 (3) of the Law, these details have been omitted as the
Company prepares consolidated accounts and these consolidated
accounts, and the related consolidated management report and
auditors’ report thereon, have been lodged with the Luxembourg
Trade Registry.
The Company’s Fiduciary Deposit Receipts (‘FDRs’) have been listed
on the Luxembourg Stock Exchange since 1998 and on Euronext Paris
since 2004 under the symbol SESG. FDRs can be traded freely and
are convertible into an equal number of Class A shares at any time,
and at no cost, at the option of the holder under the conditions appli-
cable in the Company’s articles of association, and in accordance with
the terms of the FDRs.
NOTE 2 – SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
AND VALUATION RULES
2.1. BASIS OF PREPARATION
The annual accounts are prepared in accordance with the Luxem-
bourg legal and regulatory requirements under the historical cost
convention relating to the preparation and presentation of the annual
accounts.
Accounting policies and valuation rules are, besides the ones laid
down by the amended Law of 19 December 2002, determined and
applied by the Board of Directors.
The preparation of annual accounts requires the use of certain criti-
cal accounting estimates. It also requires the Board of Directors to
exercise its judgment in the process of applying the accounting pol-
icies. Changes in assumptions may have a significant impact on the
annual accounts in the period in which the assumptions are changed.
Management believes that the underlying assumptions are appropri-
ate and that the annual accounts therefore present the financial posi-
tion and results fairly.
Management makes estimates and assumptions that may affect the
reported amounts of assets and liabilities in the next financial year(s).
Estimates and judgments are regularly re-evaluated, and are based
on historical experience and other factors, including expectations of
future events that are believed to be reasonable under the circum-
stances.
2.2. SIGNIFICANT ACCOUNTING POLICIES
The main accounting policies and valuation rules applied by the Com-
pany are the following:
2.2.1. Intangible assets
Amounts related to the development of software and other related
expenses, are included in the balance sheet when incurred. Development
expenditure is capitalised when its future recoverability can be regarded
as assured. The expenditure is transferred to assets in use, and depre-
ciation commences, when the resulting asset is put into service.
2.2.2. Financial assets
Shares in affiliated undertakings held by the Company are recorded
at acquisition cost.
In the case of a permanent diminution in the value of a financial fixed
asset in the opinion of the Board of Directors, a value adjustment is
made such that the investment is valued at the lower figure. Value
adjustments are not maintained if the reasons for which they were
made have ceased to apply.
In some instances, where the Board of Directors believes that it is
more appropriate under the circumstances and better reflects the
substance of the activity, the interdependency of cash flows between
SES subsidiaries, and their level of integration, have been considered
in assessing the carrying value of the financial assets.
SES ANNUAL REPORT 2021167
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
However, as set out in >> Note 3, where a contractual disposal of an
investment included in one of the cash-generating units triggers the
recognition of a book loss then this loss is recorded by the Company
in the result of the period when the transaction was approved and the
magnitude of the loss was ascertained.
In those instances, investments in certain undertakings have been
grouped together for the purposes of testing them for impairment –
similarly to cash generating units (‘CGUs’) as defined in IAS 36
“Impairment of Assets” under IFRS.
Loans to affiliated undertakings are valued at their nominal value.
Value adjustments are recorded on loans which appear to be partly
or wholly irrecoverable. These value adjustments are not maintained
if the reasons for which they were made have ceased to apply.
2.2.3. Investments – own shares
Own shares are recorded at acquisition cost, including expenses
incidental thereto. At the balance sheet date, own shares are valued
at the lower of acquisition cost and a valuation calculated based on
weighted average cost or market value.
A value adjustment is recorded where the market value is lower than
the acquisition cost. These value adjustments are not maintained if
the reasons for which the value adjustments were made have ceased
to apply.
2.2.4. Prepayments
Prepayments represent expenditures incurred during the financial
year but relating to a subsequent financial year.
Loan origination costs are recorded at their nominal value, and are
presented as prepayments. These costs are amortised over the
remaining estimated loan periods based on the Company’s financing
strategy.
2.2.5. Dividends paid and received
Dividends are declared after the annual accounts for the year have
been approved. Accordingly, dividends payable are recorded in the
subsequent year’s annual accounts. Dividends receivable on own
shares are recorded as income in the year in which the dividend is
approved.
Dividends receivable from affiliated undertakings are recorded as
income in the year in which they are approved by the subsidiary.
2.2.6. Debtors
Debtors are recorded at their nominal value. They are subject to value
adjustments where their recovery is uncertain. These value adjust-
ments are not continued if the reasons for which they were made have
ceased to apply.
2.2.7. Foreign currency translation
The Company maintains its books and records in euro (EUR). Trans-
actions expressed in currencies other than the euro are translated
into euros at the exchange rates effective at the time of the transac-
tion.
Except for fixed assets, all assets and liabilities denominated in foreign
currencies are converted at the rate of exchange ruling at the balance
sheet date. Realised and unrealised gains and losses are recognised
in the profit and loss account.
Fixed assets acquired in currencies other than euro, except for the
loans to affiliated undertakings, which are classified as fixed assets,
are translated into euro at the exchange rate effective at the time of
the transaction. At the balance sheet date, these assets remain trans-
lated at historical exchange rates.
The foreign exchange result for the year has been presented on a net
basis.
2.2.8. Creditors
Debenture loans and amounts owed to credit institutions are recorded
at their reimbursement value. Where the amount repayable is greater
than the amount received, then the difference is shown as an asset
and is written off over the period of the debt based on a straight-line
basis over the term of the borrowing.
SES ANNUAL REPORT 2021168
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
2.2.9. Share-based compensation
Employees of the Company receive remuneration in the form of share-
based compensation payments, whereby employees render services
to the Company as consideration for equity instruments.
Four share-based payment schemes have been established by the
Company and are available to members of the Company’s staff and
to employees of the SES Group:
Equity settled plans:
• The Stock Appreciation Rights Plan (‘STAR Plan’)
• Executive Incentive Compensation Plan (‘EICP’)
• Long-Term Incentive Programme (‘LTIP’)
Cash settled plan:
• Simulated Restricted Stock Units plan (‘SRSU Plan’)
A charge, representing the difference between the acquisition cost
of own shares and exercise price is recognised in the profit and loss
account on the exercising of share option/shares.
The SRSU Plan was inaugurated in 2017 and is replacing prospectively
the Star Plan. SRSUs are delivered on 1 June following a three-year
vesting period. Delivery occurs through a gross cash payment in the
June payroll cycle instead of in SES FDR’s.
For the cash settled plan, a charge corresponding to the number of
SRSUs outstanding at the share price on 31 December 2021 is recog-
nised in the profit and loss account on a pro-rata basis over the vest-
ing period and is presented as wages and salaries in the profit and
loss account. A corresponding liability is recorded and presented in
the balance sheet as other creditors.
NOTE 3 – FINANCIAL ASSETS
A) SHARES IN AFFILIATED UNDERTAKINGS
Movement in Shares in Affiliated Undertakings
EUR MILLION 2021 2020
Historic cost:
As at 1 January: 7,275.7 7,761.1
Increase 97.0 –
Decrease (49.3) (485.4)
As at 31 December 7,323.4 7,275.7
Accumulated value adjustments
As at 1 January (104.7) (104.7)
Increase (2,186.7) –
As at 31 December (2,291.4) (104.7)
Net book value:
As at 1 January 7,171.0 7,656.4
As at 31 December 5,032.0 7,171.0
In 2021, the increase in historic cost represents a share premium con-
tribution to SES Holdings (Netherlands) B.V. in the amount of EUR
76.5 million and a contribution in kind to SES Global – Americas, Inc.
of EUR 20.5 million. The decrease represents a share premium reduc-
tion in SES Finance S.à r.l in the amount of EUR 28.8 million and in
SES Holdings (Netherlands) B.V. of EUR 20.5 million.
In 2021, the increase in accumulated value adjustments represents
an impairment of investments in SES Global – Americas, Inc. of EUR
578.9 million, in SES Finance S.à r.l of EUR 1,502.1 million, in SES Par-
ticipations S.A. of EUR 85.5 million and in SES Astra A.B. of EUR 20.2
million.
In 2020, the decrease in historic cost represents a share premium
reduction in SES Holdings (Netherlands) B.V. in the amount of EUR
418.8 million, and a share capital reduction in SES Astra Services
Europe in the amount of EUR 66.6 million.
As at 31 December 2021, the Company held the following investments:
Net book value
EUR MILLION
Net book value
Incorporation
in 2021 2020
SES Global – Americas, Inc. United States 99.94% 2,919.2 3,477.6
SES Finance S.à r.l Luxembourg 100% 12.1 1,543.0
SES Holdings (Netherlands)
B.V.
1
Netherlands 100% 878.6 822.6
SES Astra S.A. Luxembourg 100% 1,046.8 1,046.8
SES Participations S.A. Luxembourg 100% 21.3 106.8
SES Insurance International
Re (Luxembourg) S.A. Luxembourg 100% 90.3 90.3
SES Astra A.B. Sweden 32.34% 29.9 50.1
SES Insurance International
(Luxembourg) S.A. Luxembourg 100% 15.2 15.2
SES Latin America S.A. Luxembourg 100% 18.6 18.6
Total 5,032.0 7,171.0
1 SES Holdings (Netherlands) B.V. has a 100% direct ownership of the entity New
Skies Satellites B.V. and 100% indirect ownership of the entity O3b Networks Limited.
Therefore for impairment testing purposes the investment is allocated between the
SES GEO and SES MEO cash generating units.
SES ANNUAL REPORT 2021169
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Management identified the following CGUs for the purpose of impair-
ment testing:
• SES GEO operations (‘SES GEO’) and
• SES MEO operations (‘SES MEO’).
Compared to 2020, MX1 and other service businesses (‘Services’)
have been integrated within the ‘SES GEO’ CGU since MX1 as a busi-
ness has been increasingly integrated with the Video element of the
Group’s ‘SES GEO operations’ over the last two years. Entities not
directly connected to a CGU have been considered out of scope: SES
Participations S.A., SES Insurance International Re (Luxembourg) S.A.
and SES Insurance International (Luxembourg) S.A..
The investment in SES Holdings (Netherlands) B.V., amounting to EUR
878.6 million (2020: EUR 822.6 million), includes both SES GEO and
SES MEO operations and was considered accordingly for impairment
testing purposes.
Impairment testing for SES GEO
Affiliated undertakings listed under “SES GEO” form part of the “SES
GEO operations” business of the SES Group. They are aggregated into
one CGU for the purpose of testing their carrying values for impair-
ment, considering the interdependency of their cash flows and their
level of integration >> see Note 2. Loans to and from affiliated under-
takings which are part of SES GEO are added to the carrying values
of the shares in affiliated undertakings for impairment testing.
The value-in-use of this CGU is determined based on a calculation
using the most recent business plan information approved by the
Board of Directors which covers a period of five years.
The Company holds a 99.94% interest in a partnership, SES Global
Americas Holdings GP (“the DGP”), whose accounts are integrated
into those of the Company to the level of its share in the partnership.
The DGP is the 100% owner of the Company’s interest in SES Global
– Americas, Inc.. In 2021, management decided to convert the DGP
from a partnership into a separate U.S. corporate entity (“Inc.”). This
transaction will likely occur with an effective date in H1 2022 and an
independent valuation of the DGP was performed in this respect.
Based on this valuation it is expected that the conversion of the DGP,
and subsequent disposal of the Company’s interest in the new cor-
porate vehicle to an intermediate holding company, will result in a
value adjustment on the disposal of the interest being recorded by
the Company. As this transaction had been formally approved by SES
management before the year end, and a specific permanent impair-
ment has been identified, management has recorded a corresponding
impairment charge as at 31 December 2021.
Whilst the interest is part of the Company’s portfolio of shareholdings
included in the SES GEO CGU, SES management believes that
because this loss arises from an actual share transaction, the loss
should be recorded in the books of the Company, rather than the
alternative treatment of attributing the previous carrying value of the
interest to the Company’s shareholding in the new intermediate hold-
ing company.
As such EUR 578.9 million value adjustment was recorded against the
Company’s interest in SES Global-Americas Inc.. The independent
valuation included a valuation of the DGP’s 32.34% equity interest in
SES Astra A.B, resulting in an additional EUR 20.2 million value adjust-
ment being recorded on the Company’s interest in that affiliated
undertaking.
Also in 2021, SES Satellite Leasing Limited, a subsidiary of SES Finance
S.à r.l, transfered its business from the Isle of Man to Luxembourg.
Following the transfer, SES Satellite Leasing Limited reduced its share
premium and distributed it together with the gain on the sale of its
business in form of a dividend via SES Finance S.à r.l up to the Com-
pany >> see Note 14. Following the distribution, the investment in SES
Finance S.à r.l was impaired in the amount of EUR 1,502.1 million.
Impairment testing for SES MEO operations
SES MEO operations, representing the O3b Networks business
acquired in 2016, is considered a separate CGU, as the business cur-
rently generates cash inflows that are largely independent from SES
GEO operations.
For the SES MEO CGU, the impairment test period was extended
beyond the five-year business plan period, to 2034. This extension
was deemed necessary to fully capture the contracted capital expend-
iture and expected growth of the business in connection with the
O3b mPOWER constellation, which is scheduled to launch during the
period 2022 - 2024, as well as to properly reflect the timing of replace-
ment capital expenditure.
The pre-tax discount rate applied for 2021 was 8.13% (2020: 7.97%)
and was selected to reflect market interest rates and commercial
spreads; the capital structure of businesses in the CGU’s business
sector; and the specific risk profile of the businesses concerned. The
terminal growth rate used in the valuations was 2.0% (2020: 2.0%),
which reflects the most recent long-term planning assumptions
approved by the Board of Directors and can be supported by refer-
ence to the trading performance of the companies concerned over
a longer period.
SES ANNUAL REPORT 2021170
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
B) LOANS TO AFFILIATED UNDERTAKINGS
Loans to affiliated undertakings as of 31 December 2021 consist of:
Loans to Affiliated Undertakings as of 31 December 2021
Counterparty
Principal and
accrued interest
31 December
2021
(EUR million) Maturity
Interest
rate
SES Astra S.A. 800.0 October-30 0.64%
SES-10 S.à r.l. 60.0 Jan-32 0.41%
SES Networks Lux S.à r.l. 874.9 October-29 3.33%
SES Networks Satellites S.à r.l. 424.6 October-29 3.33%
New Skies Satellites B.V. 199.5 November-23 3.14%
New Skies Satellites B.V. 367.7 November-23 3.14%
New Skies Satellites B.V. 4.9 December-24 3.14%
New Skies Satellites B.V. 229.4 December-32 3.14%
SES Holdings (Netherlands) B.V. 170.3 October-24 3.14%
SES Holdings (Netherlands) B.V. 90.5 December-24 3.14%
SES Holdings (Netherlands) B.V. 30.9 December-24 3.14%
Total
3,252.7
The Company does not consider any balances on its loans to affiliates
as being irrecoverable as at 31 December 2021.
Loans to affiliated undertakings as of 31 December 2020 consist of:
Loans to Affiliated Undertakings as of 31 December 2020
Counterparty
Principal and
accrued interest
31 December
2020
(EUR million) Maturity
Interest
rate
SES Astra S.A.
1
900.0 October-30 0.64%
HD Plus GmbH 30.5 October-22 4.50%
SES-10 S.à r.l. 66.7 November-22 0.41%
SES Americom Inc. 268.7 June-22 2.93%
SES Networks Lux S.à r.l. 782.1 October-29 3.33%
SES Networks Satellites S.à r.l. 379.6 October-29 3.33%
New Skies Satellites B.V. 179.6 November-23 3.87%
New Skies Satellites B.V. 331.0 November-23 3.87%
New Skies Satellites B.V. 4.6 December-24 3.87%
New Skies Satellites B.V. 214.5 December-24 3.87%
SES Holdings (Netherlands) B.V. 156.3 October-24 3.87%
SES Holdings (Netherlands) B.V. 84.4 December-24 3.87%
SES Holdings (Netherlands) B.V. 28.6 December-32 3.87%
SES DTH do Brasil Ltda 1.3 May-23 5.77%
SES DTH do Brasil Ltda 0.3 May-23 4.38%
SES DTH do Brasil Ltda 0.3 May-22 4.10%
SES DTH do Brasil Ltda 0.6 June-22 3.97%
SES DTH do Brasil Ltda 0.5 September-22 4.23%
SES DTH do Brasil Ltda 0.3 June-23 5.01%
SES DTH do Brasil Ltda 0.3 August-23 5.32%
SES DTH do Brasil Ltda 0.3 November-23 5.48%
Total
3,430.5
1 In the framework of a corporate restructuring exercise, ten Luxembourg satellite
companies were merged into SES Astra S.A. on 1 October 2020. All loans between
those satellite entities and the Company were settled and replaced on 1 October
2020 by a new loan between the Company and SES Astra S.A., with a principal
amount of EUR 1,000 million.
NOTE 4 – DEBTORS
A) AMOUNTS OWED BY AFFILIATED
UNDERTAKINGS
The SES Group operates a centralised treasury function at the level
of the Company, including a cash-pooling mechanism, which manages
the Group’s liquidity and optimises its funding costs.
Amounts owed by affiliated undertakings as at 31 December 2021
consist of:
Amounts owed by Affiliated Undertakings
EUR MILLION 2021 2020
Becoming due and payable within one year
Intercompany current accounts 2,381.2 1,153.5
Forward Sale Agreement with SES mPower S.à r.l. 704.2 –
Short term loan to Luxembourg satellite compa-
nies 6.7 6.7
Short term loan to SES Astra S.A. 101.5 101.7
Short term loan to SES Americom 262.3 –
Short term loan to MX1 Ltd – 4.3
Short term loan to HD Plus GmbH 30.2 30.0
Short term loan to SES Media Solutions GmbH 210.0 210.0
Value adjustments (279.8) (217.8)
Total 3,416.3 1,288.4
Becoming due an payable after one year
Forward Sale Agreement with SES mPower S.à r.l. 277.6 764.1
Long term advance to SES DTH do Brasil Ltda 9.5 9.4
Total
287.1 773.5
SES ANNUAL REPORT 2021171
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
Intercompany current accounts represent short-term advances
bearing interest at market rates.
The Company performed an analysis of the amounts owed by affiliated
undertakings and no longer considers the following balances to be
recoverable:
•
Intercompany current account with SES ASTRA Services Europe
of EUR 4.3 million (2020: EUR 6.0 million);
•
Intercompany current account with MX1 Limited of EUR 40.7 million
(2020: EUR 28.6 million);
•
Short-term loan to SES Media Solutions GmbH of EUR 210.0 million
(2020: EUR 183.2 million) and intercompany current account with
SES Media Solutions GmbH in the amount of EUR 24.8 million
(2020: EUR nil).
As at 31 December 2021 the Company recorded an overall value
adjustment of EUR 279.8 million (2020: EUR 217.8 million) in this
respect see also >> Note 17.
In 2018, SES entered into a forward sale agreement with SES
mPower S.à r.l >> see Note 11 in connection with the fleet of seven
mPower satellites currently under construction, divided into 2 sub-
blocks (1A of four satellites and 1B three satellites). In August 2020
an option to procure four additional satellites divided into 2 sub-
blocks (2A and 2B, each of two satellites) was exercised.
As at 31 December 2021, SES had a receivable from SES mPower S.à r.l
of USD 1,112.0 million (EUR 981.8 million) in the framework of this
agreement (divided by Block 1A and 1B for USD 797.6 million
(EUR 704.2 million) and Block 2A and 2B for USD 314.4 million
(EUR 277.6 million).
B) OTHER DEBTORS
Other debtors as at 31 December 2021 consist of:
Other debtors
EUR MILLION 2021 2020
Becoming due and payable within one year
Trade debtors 3.1 1.7
Other receivable related to VAT 4.2 –
Tax Authorities (see Note 10) 9.3 –
Total
16.6 1.7
NOTE 5 – INVESTMENTS – OWN SHARES
Own shares refer to the Company’s own Fiduciary Deposit Receipts.
All FDRs in respect of Class A shares owned by the Company are for
use in connection with the share-based compensation plans for exec-
utives and staff of the SES Group. FDRs are valued at the lower of the
weighted average cost and the market price.
As at 31 December 2021, the Company owned FDRs 7,748,429 (2020:
4,559,818) representing a carrying value of EUR 54.0 million (2020:
EUR 35.1 million).
NOTE 6 – SUBSCRIBED CAPITAL
SES has a subscribed capital of EUR 719.0 million (2020: EUR 719.0
million), represented by 383,457,600 Class A shares (2020:
383,457,600) and 191,728,800 Class B shares (2020: 191,728,800) with
no par value. Although they constitute separate classes of shares,
Class A and Class B shares have the same rights except that Class B
shares, which are held by the State of Luxembourg and by two enti-
ties wholly-owned by the State of Luxembourg, entitle their holders
to only 40% of the dividend, or in case the Company is dissolved, to
40% of the net liquidation proceeds paid to shareholders of Class A.
Class B shares are not freely traded. Each share, whether of Class A
or Class B, is entitled to one vote.
The movement between the opening and closing number of shares
issued per class of share can be summarised as follows:
Movement between the Opening and Closing Number of Shares
Class A
shares
Class B
shares
Total
shares
As at 1 January 2021 383,457,600 191,728,800 575,186,400
Shares issued during the year – – –
As at 31 December 2021
383,457,600 191,728,800 575,186,400
Class A
shares
Class B
shares
Total
shares
As at 1 January 2020 383,457,600 191,728,800 575,186,400
Shares issued during the year
– – –
As at 31 December 2020
383,457,600 191,728,800 575,186,400
NOTE 7 – LEGAL RESERVE
In accordance with Luxembourg legal requirements, a minimum of
5% of the annual net profit is transferred to a legal reserve. This
requirement is satisfied when the reserve reaches 10% of the issued
share capital. This reserve may not be distributed.
NOTE 8 – RESERVE FOR OWN SHARES
In accordance with the Law, the Company has created a non-distrib-
utable “reserve for own shares” for an amount of EUR 54.0 million
(2020: EUR 35.1 million), corresponding to the balance of the own
shares held as of year end.
ACQUISITION OF TREASURY SHARES
SES has historically, in agreement with its shareholders, purchased
FDRs in connection with executives’ and employees’ share-based pay
-
ments plans, as well as for cancellation.
SES ANNUAL REPORT 2021172
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 9 – CREDITORS
A) DEBENTURE LOANS – NON CONVERTIBLE LOANS
The maturity profile of notes and bonds is as follows as at 31 December 2021.
Maturity Profile of Notes and Bonds as at 31 December 2021
Creditors – Financial liabilities Interest rate Maturity EUR million
a) Debenture loans – Non convertible loans
becoming due and payable within one year
65.9
Non convertible bonds due >1 Y: Accrued interest 65.9
becoming due and payable between 2 and 5 years 1,712.2
144A Bond USD 750.0 million (2023) 3.60% April-23 662.2
German Bond issue of EUR 150.0 million (2024) Floating June-24 150.0
German Bond issue of EUR 250.0 million (2025) 1.71% December-25 250.0
EUR 650 million Eurobond (2026) 1.625% March-26 650.0
becoming due and payable after 5 years 2,927.2
EUR 140.0 million Private Placement (2027) 4.00% May-27 140.0
144A Bond USD 250.0 million (2043) 5.30% April-43 220.7
144A Bond USD 500.0 million (2044) 5.30% March-44 441.5
German Bond issue of EUR 50.0 million (2032) 4.00% November-32 50.0
EUR 550 million deeply subordinated fixed rate resettable securities 5.625% N/A* 550.0
EUR 625 million deeply subordinated fixed rate resettable securities 2.875% N/A** 625.0
EUR 500 million Eurobond (2027) 0.875% November-27 500.0
EUR 400 million Eurobond (2028) 2.00% July-28 400.0
* First reset date January – 24
** First reset date August – 26
The maturity profile of notes and bonds is as follows as at 31 December 2020.
Maturity Profile of Notes and Bonds as at 31 December 2020
Creditors – Financial liabilities Interest rate Maturity EUR million
a) Debenture loans – Non convertible loans
becoming due and payable within one year 669.3
EUR 650 million Eurobond (2021) 4.75% March-21 556.0
Non-convertible bonds due >1 Y: Accrued interest 113.3
becoming due and payable between 3 and 5 years 1,011.2
144A Bond USD 750.0 million (2023) 3.60% April-23 611.2
German Bond issue of EUR 150.0 million (2024) Floating June-24 150.0
German Bond issue of EUR 250.0 million (2025) 1.71% December-25 250.0
becoming due and payable after 5 years 3,501.2
EUR 140.0 million Private Placement (2027) 4.00% May-27 140.0
144A Bond USD 250.0 million (2043) 5.30% April-43 203.7
144A Bond USD 500.0 million (2044) 5.30% March-44 407.5
German Bond issue of EUR 50.0 million (2032) 4.00% November-32 50.0
EUR 750 million deeply subordinated fixed rate resettable securities 4.625% N/A* 750.0
EUR 550 million deeply subordinated fixed rate resettable securities 5.625% N/A** 550.0
EUR 500 million Eurobond (2026) 1.625% March-26 500.0
EUR 500 million Eurobond (2027) 0.875% November-27 500.0
EUR 400 million Eurobond (2028) 2.00% July-2028 400.0
* First reset date January - 22
** First reset date January - 24
SES ANNUAL REPORT 2021173
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
European Medium-Term Note Programme
(‘EMTN Programme’)
SES has an EMTN Programme enabling SES, or SES Global Americas
Holdings GP, to issue as and when required notes up to a maximum
aggregate amount of EUR 4,000 million. As at 31 December 2021, SES
had issued 1,690 EUR million (2020: EUR 2,096 million) under the
EMTN Programme with maturities ranging from 2022 to 2028.
EUR 650 million Eurobond (2021)
In 2021 SES fully repaid a EUR 650 million bond under the Company’s
EMTN Programme.
EUR 750.0 million Deeply Subordinated Fixed Rate
Resettable Securities (2022)
On 10 June 2016, SES issued EUR 750.0 million Deeply Subordinated
Fixed Rate Resettable Securities (‘perpetual bond’) at a coupon of
4.625% to the first call date, a price of 99.666% and a yield of 4.7%.
SES is entitled to call the securities on 2 January 2022 and on sub-
sequent coupon payment dates.
On 18 May 2021, SES announced a capped tender offer for its out-
standing EUR 750 million 4.625% perpetual bond at a fixed purchase
yield of -0.10% to refinance the existing perpetual bond callable in
January 2022 in advance of the first call date. The tender offer was
accepted by the required number of bondholders such that the Com-
pany was able to repurchase 84.5% of the existing bonds on 28th May
at a price representing 102.838% of nominal value, and the remaining
15.5% at par, with a settlement date of 30 June 2021.
144A Bond USD 750 million (2023)
In 2013 SES completed a 144A offering in the US market issuing USD
750 million 10-year bond with a coupon of 3.60% and a final maturity
date on 4 April 2023.
EUR 650 million Eurobond (2026)
In 2018, SES issued a EUR 500 million 8-year bond under the Com-
pany’s EMTN Programme. On the 22 June 2021 SES announced the
successful lunch and pricing of a tap of its 1.625% Notes in which it
has agreed to sell incremental senior unsecured fixed rate notes for
a total amount of EUR 150 million. The new notes were priced at
106.665% of their nominal value. The bond bears interest at a fixed
rate of 1.625% and has a final maturity date on 22 March 2026.
EUR 500 million Eurobond (2027)
On 4 November 2019, SES issued a EUR 500 million bond under the
Company’s EMTN Programme. The bond has an 8-year maturity and
bears interest at a fixed rate of 0.875% and has a final maturity date
on 4 November 2027.
EUR 550.0 million Deeply Subordinated Fixed Rate
Resettable Securities (2024)
In November 2016, SES issued a second perpetual bond of EUR 550.0
million at a coupon of 5.625% to the first call date, a price of 99.304%
and a yield of 5.75%. SES is entitled to call the second perpetual bond
on 29 January 2024 and on subsequent coupon payment dates.
EUR 140 million Private Placement (2027)
In 2012, SES issued three individual tranches of a total EUR 140 mil-
lion Private Placement under the Company’s EMTN Programme with
ING Bank N.V.. The Private Placement has a 15-year maturity, begin-
ning 31 May 2012, and bears interest at a fixed rate of 4.00%.
EUR 400 million Eurobond (2028)
On 2 July 2020, SES issued a EUR 400 million bond under the Com-
pany’s EMTN Programme. The bond has an 8-year maturity and
bears interest at a fixed rate of 2.00% and has a final maturity date
on 2 July 2028.
German bond issue of EUR 50 million (2032)
In 2012, the Group signed an agreement to issue EUR 50 million in
the German bond (‘Schuldschein’) market. The German bond bears
a fixed interest rate of 4.00% and matures on 12 November 2032.
144A Bond USD 250 million (2043)
In 2013, SES completed a 144A offering in the US market issuing
USD 250 million 30-year bond with a coupon of 5.30% and a final
maturity date on 4 April 2043.
144A Bond USD 500 million (2044)
In 2014, SES completed a 144A offering in the US market issuing
USD 500 million 30-year bond with a coupon of 5.30% and a final
maturity date of 25 March 2044.
German bond issue of EUR 400 million (2024/2025)
In 2018, the Group closed the issuance of an aggregated amount of
EUR 400 million in the German bond (‘Schuldschein’) market. The
transaction consists of two individual tranches – a EUR 150 million
tranche with a floating interest rate of a six-month EURIBOR plus a
margin of 0.8% and a final maturity date on 18 June 2024 as well as
a EUR 250 million tranche with a fixed interest rate of 1.71% and a final
maturity date on 18 December 2025.
SES ANNUAL REPORT 2021174
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
B) AMOUNTS OWED TO CREDIT INSTITUTIONS
Amounts owed to credit institutions as of 31 December 2021 were:
Amounts owed to Credit Institutions
as of 31 December 2021
Creditors – Financial liabilities
Interest
rate Maturity
EUR
million
b) amounts owed to
credit institutions
becoming due and payable
within one year 40.2
COFACE facility
EURIBOR
+1.70%
various in
2022 40.2
Amounts owed to credit institutions as of 31 December 2020 were:
Amounts owed to Credit Institutions
as of 31 December 2020
Creditors – Financial liabilities
Interest
rate Maturity
EUR
million
b) amounts owed
to credit institutions
becoming due and payable
within one year 40.7
COFACE facility
EURIBOR
+1.70%
various in
2020 40.7
becoming due and payable
after more than one year 40.2
COFACE facility
EURIBOR
+1.70%
various from
2021 to 2022 40.2
Syndicated loan 2019
The syndicated loan facility contracted in 2019 is being provided by
19 banks and has been structured as a 5-year multi-currency revolving
credit facility. In 2021 the Company extended the Termination date
from 26 June 2025 to 26 June 2026. The facility is for EUR 1,200.0
million and the interest payable is linked to a ratings grid. At the
current SES credit rating of BBB- / Baa2, the interest rate is 45 basis
points over EURIBOR/LIBOR. As at 31 December 2021 and 2020, no
amount has been drawn under this facility.
EUR 522.9 million COFACE facility
In 2009 SES signed a financing agreement with Compagnie Française
d’Assurance pour le Commerce Extérieur (‘Coface’) in respect of the
investment in four geostationary satellites. The facility is divided into
five loans. The drawings under the facility were based on invoices
from the supplier of the satellites. The first drawing was done on
23 April 2010 and all loan tranches became fully drawn in November
2014.
The Coface tranches outstanding as at 31 December 2021 have
maturity dates as follows: Coface A on 1 August 2022; Coface C and
D on 3 October 2022.
The entire facility bears interest at a floating rate of six-month
EURIBOR plus a margin of 1.7%. During 2021, SES repaid floating rate
obligations totalling EUR 40.7 million (2020: EUR 41.2 million) related
to various Coface instalments.
European commercial paper programme
In 2012 SES incepted a joint EUR 1,000.0 million guaranteed European
commercial paper programme of SES S.A. and SES Global Americas
Holdings GP. Issuances under the programme represent senior un -
secured obligations of the issuer and are guaranteed by the non-
issuing entity. The programme is rated by Moody’s Investors Services
and is compliant with the standards set out in the STEP Market
Convention. On 9 July 2021, this programme was updated and
extended. As at 31 December 2021 and 2020, no borrowings were
outstanding under this programme.
Negotiable European Commercial Paper “NEU CP” (previ-
ous French Commercial paper programme)
In 2005 SES put in place a EUR 500.0 million ‘NEU CP’ programme in
accordance with articles L.213-1 to L213-4 of the French Monetary
and Financial Code and article 6 of the order of 30 May 2016 and
subsequent amendments. The maximum outstanding amount of
‘NEU CP’ issuable under the programme is EUR 500.0 million or its
counter value at the date of issue in any other authorised currency.
On 21 May 2021, this programme was extended for one further year.
As at 31 December 2021 and 2020, no borrowings were outstanding
under this programme.
Committed and uncommitted loan facilities
As at 31 December 2021, and as at 31 December 2020, the Company
had no outstanding balances under uncommitted loan facilities.
SES ANNUAL REPORT 2021175
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
C) AMOUNTS OWED TO AFFILIATED
UNDERTAKINGS
Amounts owed to affiliated undertakings of 2,214.1 EUR million (2020:
EUR 2,038.2 million) include the following:
Amounts owed to Affiliated Undertakings
EUR MILLION 2021 2020
Long term loans (maturity after five years) – 41.7
Long term loans (less than five years) 587.3 573.0
Current accounts 1,626.8 1,423.5
Total 2,214.1 2.038.2
“Current accounts” are linked to the daily cash pooling mechanism
and represent short term debts bearing interest at market rates. The
daily cash pooling mechanism supports, among others, the liquidity
of the Group in order to optimize the funding costs.
During 2021 the Company repaid a long term loan for a total amount
of USD 51.4 million (EUR 45.3 million) from SES Satellites Gibraltar
Ltd. with a maturity date of May 2025 and bearing interest at a rate
of 4.2%.
As at 31 December 2021, long term loans included:
• A loan for a total amount of USD 615.4 million (EUR 543.4 million)
from SES Americom Inc. with a maturity date of March 2024 and
bearing interest at a rate of 3.7%;
• A loan for a total amount of SEK 450.3 million (EUR 43.9 million)
from SES Astra AB with a maturity date of November 2023 and
bearing interest at a rate of 0.72%.
NOTE 10 – OTHER CREDITORS – TAX
AUTHORITIES
The Company is subject to the tax regulations in Luxembourg, in the
U.S. for the partnership and till October 2020 in Switzerland for the
Swiss branch. In accordance with Article 164bis of the Luxembourg
income tax law, SES S.A. is the head of the Luxembourg tax unity with
its direct and indirect subsidiaries as follows:
• SES Astra S.A.
• SES Asia S.A.
• SES-10 S.à r.l.
• SES Participations S.A.
• SES Engineering S.à r.l.
• SES Astra Services Europe S.A.
• SES Lux Finance S.à r.l.
• SES Networks Lux S.à r.l.
• SES Techcom S.A.
• SES Latin America S.A.
• SES Insurance International (Luxembourg) S.A.
• SES Insurance International Re (Luxembourg) S.A.
• SES-17 S.à r.l.
• SES mPower S.à r.l.
• SES Networks Satellites S.à r.l.
• SES LU Satellite Holdings S.à r.l.
The balance sheet tax position represents the net amount payable
to, or receivable from, the Luxembourg tax authorities by the Com-
pany in its role as head of the tax unity. The total net tax receivable
of EUR 9.3 million as at 31 December 2021 is recorded within caption
“Other debtors” and includes a payable for corporate income tax of
EUR 7.4 million, municipal business tax receivable of EUR 16.6 million
and a Net Wealth Tax receivable of EUR 0.1 million (2020: a net tax
liability of EUR 0.3 million).
The respective tax charge/income of each subsidiary is computed on
a stand-alone basis and it is recorded for the entire Luxembourg tax
unity by the Company.
NOTE 11 – OTHER CREDITORS
ACQUISITION OF SES mPOWER MEDIUM-EARTH
ORBIT CONSTELLATION
In September 2017, the Company, jointly with O3b Networks Limited,
entered as Procurement Agents into a Master Procurement Agency
and Option Agreement with a financial institution in connection with
the procurement by that financial institution of seven medium-Earth
orbit satellites from The Boeing Company.
Under the satellite Purchase and Sale agreement seven satellites were
procured divided into 2 sub-blocks (Sub-Block 1 A consisting of four
satellites and sub-block 1B consisting of three satellites) currently
under construction. At the end of the satellite construction period,
which is foreseen in 2022, the SES Group will have the right to acquire,
or lease, the satellites from the financial institution or to direct their
sale to a third-party.
SES has the right to nominate the entity within the SES Group which
will acquire or lease those assets shortly before the end of the con-
struction period.
SES management expects that the satellites will be acquired or leased
in due course by the company SES mPower S.à r.l. in Luxembourg. To
this end the Company entered into a forward sale agreement with
that entity as at 29 May 2018 whereby as the satellite construction
process proceeds, and the Procurement Agents confirm that con-
struction milestones are achieved, then the underlying asset- under-
construction is transferred by the Company to that entity against an
intercompany receivable.
Since the underlying Satellite Purchase and Sale Agreement is directly
between the financial institution and The Boeing Company then there
is no contractual obligation on the side of the Procurement Agents
during the satellite construction process.
SES ANNUAL REPORT 2021176
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
However, SES management takes the view that there is a constructive
obligation arising over the construction period and hence the SES
Group is accruing for the costs of this programme.
In August 2020 the priced option under the Purchase and Sale
agreement to procure 4 additional satellites divided into 2 sub-blocks
(Sub-block 2A consisting of two Satellites and sub-block 2B consist-
ing of 2 Satellites) was exercised. At the end of the satellite construc-
tion period, foreseen in 2023 for sub-block 2A and 2024 for sub-block
2B, the SES Group will have the right to acquire, or lease, the satellites
from the financial institution or to direct their sale to a third-party.
As at 31 December 2021 the total amount of EUR 981.8 million
(USD 1,112.0 million) 2020: EUR 764.1 million (USD 937.7 million),
corresponding to the constructive obligation by the Company
towards the financial institution procuring the satellites, was recorded
under the caption ‘Other creditors – becoming due and payable within
one year’ for Bloc 1A and 1B in the amount of EUR 704.2 million
(USD 797.6 million) and under the caption ‘Other creditors – becom-
ing due and payable after one year’ for Bloc 2A and 2B in the
amount of EUR 277.6 million (USD 314.4 million). Corresponding
amount due to the Company from SES mPower S.à r.l. under a forward
purchase agreement, was disclosed on the balance sheet under the
caption ‘Amounts owed by affiliated undertakings – becoming due
and payable within one year’ for Bloc 1A and 1B in the amount of
EUR 704.2 million (USD 797.6 million) and ‘Amounts owed by affiliated
undertakings – becoming due and payable after one year’ for Bloc 2A
and 2B in the amount of EUR 277.6 million (USD 314.4 million)
>> see also Note 4.
Other Creditors as at 31 December 2021 consist of:
Other Creditors
EUR MILLION 2021 2020
Becoming due and payable within one year
SES mPower acquisition 704.2 –
Personnel-related accruals 7.6 4.8
Total 711.8 4.8
Becoming due and payable after one year
SES mPower acquisition 277.6 764.1
Total 277.6 764.1
NOTE 12 – OTHER OPERATING INCOME AND
OTHER EXTERNAL EXPENSES
Other operating income of EUR 27.3 million (2020: EUR 18.5 million)
consists mainly of intra-group recharge income from advisory support
services rendered to various affiliates.
Other external expenses of EUR 28.8 million (2020: EUR 34.0 million)
consists mainly of intra-group recharge expenses for advisory support
services rendered to the Company by various affiliates.
NOTE 13 – STAFF COSTS
As at 31 December 2021, the number of full-time equivalent employ-
ees was 102 (2020: 93) and the average number of employees in the
workforce for 2021 was 103 (2020: 86). Staff costs can be analysed
as follows:
Staff Costs
EUR MILLION 2021 2020
Wages and salaries 15.6 15.2
Social security costs relating to pension 1.7 1.5
Other social security costs 0.6 0.2
Other staff costs 0.1 0.2
Total 18.0 17.1
NOTE 14 – INCOME FROM PARTICIPATING
INTERESTS
Income from participating interests concerning affiliated undertak-
ings consists of the following:
Income from Participating Interests
EUR MILLION 2021 2020
Dividends received SES Finance S.à.r.l.
(see >> Note 3) 1,887.3 –
Dividends received SES Astra S.A. – 950.0
Dividends received SES Astra A.B. 6.4 7.0
Dividends received on own shares 3.1 2.0
Total 1,896.8 959.0
SES ANNUAL REPORT 2021177
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 15 – INCOME FROM OTHER
INVESTMENTS AND LOANS
Income from other investments and loans forming part of fixed assets:
Income from Other Investments and Loans
EUR MILLION 2021 2020
Interest income from affiliated undertakings 85.0 98.9
Total 85.0 98.9
NOTE 16 – OTHER INTEREST RECEIVABLE
AND SIMILAR INCOME
A) DERIVED FROM AFFILIATED UNDERTAKINGS
Other interest receivable and similar income derived from affiliated
undertakings in the amount of EUR 40.5 million (2020: EUR 32.3 million)
represent interest income on intercompany current accounts.
B) OTHER INTEREST AND SIMILAR INCOME
Other Interest Receivable and Similar Income
EUR MILLION 2021 2020
Interest income on bank accounts 0.1 0.6
Foreign exchange gain 228.1 163.4
Gain on disposal on own shares 0.4 –
Total 228.6 164.0
NOTE 17 – VALUE ADJUSTMENTS IN RESPECT
OF FINANCIAL ASSETS AND INVESTMENTS
HELD AS CURRENT ASSETS
Value adjustments of financial assets and investments held as current
assets were recorded in respect of:
Value adjustments of financial assets and investments
EUR MILLION 2021 2020
Shares in affiliated undertakings 2,186.7 –
Amounts owed by affiliated undertakings 62.0 217.8
Net loss on SES FDRs 3.5 22.4
Total 2,252.2 240.2
As at 31 December 2021 the Company recorded value adjustments in
respect of shares in affiliated undertakings of EUR 2,186.7 million
(2020: EUR nil) >> see also Note 3 and a value adjustment of
EUR 62.0 million in respect of amounts owed by affiliated under-
takings (2020: EUR 217.8 million) >> see Note 4.
A net loss of EUR 3.5 million (2020: loss of EUR 22.4 million) was
recorded on FDRs comprising a loss on disposals of EUR 3.9 million
(2020: loss of EUR 12.3 million) and a revaluation gain on FDRs held
as at 31 December 2021 of EUR 0.4 million (2020: EUR 10.1 million
[loss]) to account for the FDRs at the lower of the weighted average
cost and the market price. The price of the SES FDR listed on Euron-
ext in Paris was EUR 6.97 as at 31 December 2021 (2020: EUR 7.72).
NOTE 18 – INTEREST PAYABLE AND
SIMILAR EXPENSES
A) CONCERNING AFFILIATED UNDERTAKINGS
Interest payable and similar expenses with affiliated undertakings in
the amount of EUR 29.5 million (2020: EUR 28.5 million) represent
interest charges on intercompany current accounts.
B) OTHER INTEREST AND SIMILAR EXPENSES
Other interest and similar financial expenses include the following:
Other Interest Payable and Similar Expenses
EUR MILLION 2021 2020
Interest charges on loans and bank accounts 186.7 216.7
Loan fees and origination costs 31.0 15.4
Loss on disposal on own shares – 2.3
Foreign exchange loss 157.3 203.5
Total 375.0 437.9
SES ANNUAL REPORT 2021178
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
NOTE 19 – AUDIT FEES
Art. 65 Paragraph (1) 16º of the Law requires the disclosure of the
independent auditor fees.
In conformity with the Law these details have been omitted as the
Company prepares consolidated accounts in which this information
is disclosed, and these consolidated accounts and the related con-
solidated management report and auditors’ report thereon have been
lodged with the Luxembourg Trade Registry.
Fees incurred in connection with other assurance and non-audit services
rendered to the Company and its controlled undertakings as defined
by the Regulation (EU) N°537/2014 amounted to EUR 88,000 (2020:
EUR 35,000) and represented comfort letters issued in connection
to the Company’s treasury funding operations.
NOTE 20 – BOARD OF DIRECTORS’
REMUNERATION
Total payments to directors for attendance at board and committee
meetings in 2021 amounted to EUR 1.1 million (2020: EUR 1.1 million).
These payments are computed on a fixed and variable basis, the
variable part being based upon attendance at board and committee
meetings.
NOTE 21 – OFF BALANCE SHEET
COMMITMENTS
CAPITAL COMMITMENTS
On 11 September 2017, SES S.A., jointly with O3b Networks Limited,
entered as Procurement Agents into a Master Procurement Agency
and Option Agreement with a financial institution in connection with
the procurement by that financial institution of seven medium-Earth
orbit satellites from The Boeing Company. In August 2020 the
company procured additional 4 satellites. The outstanding commit-
ments of the Company in respect of the related contracted capital
expenditure as at 31 December 2021 amounting to USD 62.3 million
(EUR 55.0 million).
GUARANTEES
On 31 December 2021 the Company had outstanding bank guarantees
provided for an amount of EUR 66.8 million (2020: EUR 89.1 million)
with respect to performance and warranty guarantees for services of
satellite operations.
PARENTAL GUARANTEES
SES S.A. issued a letter of guarantee to one of its subsidiaries to
provide sufficient financial support to meet its obligations in full for
at least two years after the issuance date of the 31 December 2021
standalone financial statements of the subsidiary.
LITIGATION
SES S.A. is not currently subject to any material legal proceedings or
litigation arising in the normal course of business.
NOTE 22 – SUBSEQUENT EVENTS
There were no other significant events between the balance sheet
date and the approval of the annual accounts which would have influ-
enced the results of the Company as at 31 December 2021.
As set out in more detail in >> Note 3, management has decided to
convert the DGP from a partnership into a separate U.S. corporate
entity (“Inc.”) in H1 2022.
SES ANNUAL REPORT 2021180
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
FINANCIAL CALENDAR
2021 FULL YEAR
RESULTS
24 FEBRUARY 2022
ANNUAL
GENERAL MEETING
7 APRIL 2022
PAYMENT OF
2021 DIVIDEND
21 APRIL 2022
Q1 2022
RESULTS
5 MAY 2022
2022 HALF YEAR
RESULTS
4 AUGUST 2022
Q3 2021 RESULTS
3 NOVEMBER 2022
SES ANNUAL REPORT 2021181
1
OPERATIONAL
& STRATEGIC
REPORT
2
ENVIRONMENTAL,
SOCIAL & GOVERNANCE
(ESG) REPORT
3
CORPORATE
GOVERNANCE &
REMUNERATION
4
CONSOLIDATED
FINANCIAL
STATEMENTS
5
SES S.A.
ANNUAL
ACCOUNTS
6
ADDITIONAL
INFORMATION
IMPRINT
CONTACT
SES HEADQUARTERS
www.ses.com
The SES Investor Relations team will be pleased
to assist you with any questions you may have in
relation to SES. Please reach out via [email protected]
Investors
Richard Whiteing
E: richard.[email protected]
T: +352 710 725 261
Media (External Communications)
Suzanne Ong
E: [email protected]om
T: +352 710 725 500
CONCEPT AND DESIGN
MPM Corporate Communication Solutions
Mainz, Germany
www.mpm.de
PHOTO CREDITS
SES; Getty, Shutterstock, istock, Adobe Stock
SES HEADQUARTERS
Château de Betzdorf
L-6815 Betzdorf
Luxembourg