Posts Tagged ‘Avi Cohen’

SES Announces 1H 2016 Results; MX1 a €240 million Annual Revenue Business

Analysis, Broadcast technology vendor financials, Quarterly Results | Posted by Josh Stinehour
Aug 14 2016

Satellite service provider SES reported 1H 2016 results for its Video business of €665.7 million, an increase of 0.8% versus 1H 2015, and an increase of 4.1% when compared to the second half of 2015.  On a constant currency basis the Video business grew 0.3% on a year-over-year basis.    SESLogo

For the first half of 2016, the Video division contributed 70% of SES’s total revenue, an increase compared to the 66% contribution in 1H 2015, and the 67% contribution for the full year 2015.

SES’s acquisition of RR Media was not completed until July 6, 2016.   As such, no revenues from RR Media were included in SES Video’s first half results.  RR Media generated €63.2 million of revenue during the first half of 2016.

SES merged the former RR Media business with its SES Platform Services subsidiary.  The new subsidiary was rebranded MX1.

Update on MX1 Subsidiary

During SES’s investor day, Management disclosed the combined MX1 business is a €240 million annual revenue business with a backlog of €500 million (or two years of annual revenue).  The regional revenue breakdown is 70% Europe and 30% outside of Europe. Half of MX1’s revenue is generated by the resell of satellite capacity – with SES acting as the satellite service provider for 50% of this capacity.

For the full year 2016 the acquisition of the former RR Media business is expected to contribute €70 million of revenue to SES’s Video business (before eliminating intercompany revenue).

On the Company’s earnings call with analysts, SES’s CEO Karim Michael Sabbagh offered an anecdote on the SES’s initial synergies with RR Media by relaying a recent briefing by Avi Cohen, CEO of MX1 (and former CEO of RR Media) to the board of SES.  “…he [Avi] mentioned three key multimedia clients with whom they have served.  And he said had it not been for SES, we would not have signed them… this speaks for itself when you have the kind of capabilities that they have, that we have and the kind of market access that we have through our almost three decade long experience with these clients” said Mr. Sabbagh.

Update on Satellite Channel Developments

In its earnings presentation, SES reviewed data points on the channel growth over its satellite network during first half of 2016.

Total channels for SES’s Video business was 7,463 at the end of 1H 2016, representing an increase of 4.2% on a year-over-year basis, and sequential growth of 2.7% since the end of 2015.

HDTV channels distributed by SES grew 9.5% to 2,442 (32.7% of total channels).  60% of all channels are now broadcast in the MPEG-4 compression standard.  This compares to 54% in first half of 2015 and 60% at the end of 2015.

The channel count for Ultra HD (UHD) is now 16, versus eight at the end of 2015 and zero a year earlier.  Management highlighted the May 2016 announcement with Viasat to launch an Ultra HD sports channel.  The new channel will launch in Scandinavia in August 2016.

International markets outside of Europe and North America, including the faster growing markets of Latin America, Asia-Pacific, the Middle East and Africa, made up 38% of TV channels over SES satellites.  The channel count in this region grew by 1.7% during the first half of the year to a total of 2,850 channels.

The below slide from SES’s investor presentation illustrates channel and geographic growth of the Video business.


Related Content

Press Release: SES first half of 2016 Results

Presentation: SES first half of 2016 Results



© Devoncroft Partners 2009 – 2016. All Rights Reserved.



SES Completes Acquisition of RR Media; Renames MX1

Broadcast Vendor M&A, Media Services M&A, OTT Video | Posted by Josh Stinehour
Jul 06 2016

Satellite service provider SES today announced the completion of its acquisition of RR Media (NASDAQ: RRM), a provider of media services to the broadcast and media industries.  The acquisition was announced in late February 2016, but had been pending closing conditions and regulatory approvals.  RR Media’s shares ceased trading on the NASDAQ today.   SESLogo

As indicated in the original announcement, SES is merging the operations of RR Media with its Platform Services group to create a larger global media solution provider.  The new combined group will operate under the trade name MX1.  Avi Cohen, the previous CEO of RR Media, will serve as the CEO of MX1.MX1

The press release announcing the new trade name highlights the origin of MX1 from the below statement.

“Bringing it all together for the first time, MX1 aims to be the new number 1 in Media eXperience.”

SES’s new MX1 subsidiary will have 16 offices worldwide and six media centers.  MX1 is now responsible for distributing more than 1,000 TV channels, managing 440 channels of playout, and delivering content to over 120 subscription VOD platforms.

MX1 and SES’s HD Plus subsidiary will constitute the SES Media Solutions group led by Wilfried Urner.  HD Plus is a HD satellite TV offering in Germany.

Mr. Urner commented on the acquisition as follows, “We are confident that the new MX1 will leverage the expertise and success they have garnered in their respective key markets to expand their product portfolio. The addition of MX1 to the SES group is a first step in globalising SES’s video services business and in accelerating the completion of our goal to become one of the leading next generation media service providers”

Avi Cohen, CEO of MX1, added, “This is an exciting day for us as we introduce a new company to the industry and our new brand name and logo…This merger allows us to scale-up on a global basis and become the world’s leading media services provider, delivering next-generation digital video and media solutions to our worldwide customers.”


Related Content:

Press Release: SES Press Release on Completion of the Acquisition

Press Release: MX1 Reveals New Company Brand as a World-Leading Media Services Company

SES to Acquire RR Media for $242 Million in All-Cash Deal



© Devoncroft Partners 2009-2016.  All Rights Reserved.



SES to Acquire RR Media for $242 Million in All-Cash Deal

Analysis, Broadcast Vendor M&A | Posted by Josh Stinehour
Feb 26 2016

Satellite service provider SES announced an acquisition agreement with RR Media (NASDAQ: RRM), a provider of media services to the broadcast and media industries.  SES intends to merge the operations of RR Media with its Platform Services group (“SES PS”) to create a larger global media solution provider.SES_Platform_Services_logo

During its 2015 earnings release, SES indicated the contract backlog of SES PS was over €300 million.  By comparison, the RR Media contract backlog as of September 30, 2015 was $262 million.

Wilfried Urner, Chief Executive Officer of SES PS, commented, “RR Media has successfully developed the capability to manage and deliver premium content effectively, helping its customers to reach a global audience over multiple satellite, cable TV, IPTV, online and mobile platforms. SES, as the largest global platform for video in terms of reach and channels, adds global scale and considerable insights from the successful development of SES PS in Europe.”

SES will pay all-cash for the acquisition of 100% of the shares of RR Media at a price of $13.291 (USD) per share. The consideration equates to an Enterprise Value of USD $242 (USD) million, which represents a 52% premium to RR Media’s share price on February 25, 2016.

During RR Media’s Q3 2015 earnings release Management had issued 2015 revenue guidance of $140 million to $143 million with adjusted EBITDA in the range of $17.6 million and $20.4 million.  Using the midpoint of this guidance, the implied valuation multiples are 1.7x 2015 Revenue and 12.7x 2015 adjusted EBITDA.  As part of SES’s earnings release for 2015, management indicated the acquisition is anticipated to be earnings accretive in the first year.

RR Media is expected to generate between $160 million and $170 million for the full year 2016. The growth estimates for 2016 are based on recognizing the full contribution of two acquisitions made by RR Media in 2015 for Satlink Communications and Eastern Space Systems (ESS).

The announced acquisition has already been approved by the Boards of Directors of both SES and RR Media.  It remains subject to regulatory approvals and the approval of the shareholders of RR Media.  The transaction is expected to close in Q2 or Q3 2016.

Commenting on the announcement, Avi Cohen, Chief Executive Officer of RR Media, said, “SES Platform Services is an important industry player with the capabilities to service strong upper tier clients. With the combined infrastructure and industry expertise, the integrated company will have the capability to deliver innovative solutions to top tier clients, emerging markets and global customers. RR Media’s growth strategy has focused on top tier client and increasing scale. This deal achieves both of these strategic goals.”



Related Content: 

SES Press Release: RR Media to Merge with SES Platform Services, Creating a World-Leading Global Media Solutions Provider

RR Media Press Release: RR Media to Merge with SES Platform Services




© Devoncroft Partners 2009 – 2016. All Rights Reserved.



%d bloggers like this: