AsiaSat 1H Revenue Down 5% to US$88.39 Million

Hong Kong, Aug. 9, 2019 — Asia Satellite Telecommunications Holdings Limited (SEHK: 1135) announced today its revenue dropped 5% to US$88.39 million (HK$693 million) primarily due to non-renewal of certain customer contracts in mid-2018 and the continued pricing pressures from capacity oversupply in some key markets.

Asiasat said first half 2019 profit attributable to owners, however, was up 4% to US$28.44 million (HK$223 million) as a result of cost controls, favorable currency fluctuations, and reduced tax expenses.

The company also reported strong cash flow with cash and bank balances at US$119.64 million (HK$938 million) as of 30 June 2019 and an interim dividend of US$0.0229 (HK$0.18) per share.

Overall capacity utilization of AsiaSat’s core fleet of AsiaSat 5, AsiaSat 6, AsiaSat 7, AsiaSat 8 and AsiaSat 9 stood at 70% (128 transponders utilised/leased) as of 30 June 2019 compared to 72%, 131 transponders utilised/leased in December 2018.

The company said the initiative to transform AsiaSat 9 into a video ‘hotbird’ continues to gain traction, with new channels in Mandarin, Korean and Nepali added and market access expanding across the Asia-Pacific.

With extended C-band satellite spectrum being repurposed for 5G services in various countries at different paces causing a tightening supply of C-band capacity, the company has resorted to commercial and technical solutions including ‘traffic re-grooming’ to optimise available capacity for video distribution

The company added that introduction of a new 5G bandpass filter that has been proven effective in protecting customers’ existing C-band services against out-of-band interference due to 5G network deployment.

AsiaSat’s chairman, Gregory M. Zeluck, said, “It is useful to note that satellite remains as the video delivery method of choice in the Asia-Pacific while new terrestrial services such as over-the-top (OTT), video-on-demand (VOD) and subscription video-on-demand (SVOD) continue to operate at a low revenue base. As of now, though the impact of OTT and other digital terrestrial platforms remains limited, we expect them to grow rapidly and the Group will continue to evaluate and explore various opportunities with our customers to provide new OTT services as value added extensions of our existing video distribution services.

In the first half of 2019, low-flexibility high-throughput satellite (HTS) capacity has been deployed by some regional operators, causing an increase in supply vis-à-vis demand for data services. Such excess of low-flexibility capacity has put pressures on the commercial viability of this type of HTS and some applications in traditional fixed satellite service (FSS) data services, thus reaffirming the Group’s decision to adopt a cautious approach to our plans for future data satellites to be designed with a cost-effective HTS architecture that could meet market needs for customized data services.”