ASIA SATELLITE TELECOM HOLDINGS LTD. 2015 revenue of HK$1,311 million, down 4% from the previous year primarily attributable to the non-renewals of contracts by several customers as a result of challenging conditions in the Asian markets and downward pressure on transponder pricing
Combined new and renewed contracts during the year amounted to HK$1,310 million, compared to HK$932 million in 2014. Excluding the value from new contracts with a customer for the short-term use of AsiaSat 3S, the increase from new contracts was modest, reflecting the continued intense competition in the market
2015 profit attributable to equity holders of HK$440 million, compared to HK$559 million in 2014. The decline was due to lower revenue, increased interest expense and the lack of the finance income generated in the prior year
Having regard to the significant dividend already paid in 2015, the Board does not recommend a final dividend for the year ended 31 December 2015. However, a total dividend of HK$12.07 per share was paid during the year, comprising the interim dividend of HK$0.18 per share and a special interim dividend of HK$11.89 per share
Operational Highlights:New shareholder - The Carlyle Group replaced General Electric Company as one of AsiaSat's major shareholders
A comprehensive rebranding exercise commenced in March 2015 continuing with the momentum of improving and providing ever better services to customers
Restructured the sales teams with the creation of a Global Accounts group and a new Sales Solutions team to enhance further our customer service
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Successfully regained access to the video market in China and a new customer was secured on AsiaSat 6 that will generate revenues from January 2016
Maintained market leadership in satellite broadcasting through advancing Ultra HD (UHD) transmission via satellite in Asia with the launch of two free-to-air UHD channels, "4K-SAT" and "4K-SAT2", on AsiaSat 4
AsiaSat's fleet of six in-orbit satellites continued to perform well during the year. Overall utilisation of AsiaSat 4, AsiaSat 5 and AsiaSat 7 stood at 72%
Construction of AsiaSat 9, AsiaSat 4's replacement, remains on track for completion in late 2016 or early 2017. This new satellite will add additional Ku-band capacity at 122ºE to serve new opportunities in the Asia-Pacific market
AsiaSat's Chairman, JU Wei Min, said, "The year ahead will be a very challenging one for AsiaSat and the satellite industry as a whole. Competition in our markets will continue to intensify, particularly from some of the global operators seeking new business as their key markets mature. In the meantime, other regional operators are actively looking for opportunities to expand in Asian markets as well."
"Despite these challenges, new mobile applications such as broadband to automobiles, public transportation, maritime and aviation are growing. DTH services in the region continue to expand while broadcasters progress from Standard Definition (SD) to High Definition (HD) and UHD/4K. At the beginning of 2016, we began generating revenue from AsiaSat 6 for distributing video services in China. We also enjoy an excellent reputation in the industry for quality service and strong technical capabilities, highlighted by our growing expertise in UHD TV broadcasting," Mr. JU added.
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Media Contacts:
Asia Satellite Telecommunications Holdings LimitedSabrina Cubbon, VP, Marketing & Global Accounts Tel: (852) 2500 0899
Mobile: (852) 9097 1210
Email: scubbon@asiasat.com
Winnie Pang, Manager, Marketing Communications Tel: (852) 2500 0880
Email: wpang@asiasat.com
(Incorporated in Bermuda with limited liability)
Stock Code: 1135
AsiaSat had a transformative year in 2015, during which the Company prepared itself for the challenges and opportunities that lie ahead.
During the year, a subsidiary of The Carlyle Group ("Carlyle") acquired all the shares in the Company previously owned by General Electric Company ("GE"), one of our former major shareholders. The Company's capital structure was changed following the payment of a special dividend to all shareholders. Late in the year, we regained access to Chinese video market after an absence of nine years. Additionally, we undertook a major rebranding exercise and re- organised our sales teams to enhance further our proactive approach to customer service.
During the year, customers continued to trust us with providing excellent coverage of major news, sporting and political events across the region. These included the FA Cup, the Australian Open Tennis and the Southeast Asian Games in Singapore as well as the Asian African Conference in Indonesia and the 2015 APEC Economic Leaders' Meeting in the Philippines.
As we announced in November 2015 and anticipated in our 2014 annual and 2015 interim reports, the Company's financial results were affected in 2015 by a number of factors. During the year, we were faced with depreciation and interest expenses for our new AsiaSat 6 and AsiaSat 8 satellites, as well as the additional costs of financing the special dividend paid. As a result of delays in receiving required licences for new satellites to operate in certain key markets, these additional costs were not mitigated as the Company was unable to commence providing services to the expected new customers for our new satellites during the year.
Nevertheless, with the licence granted at the beginning of 2016, we secured a new customer to use AsiaSat 6 to provide video services in China. This new contract has begun to generate revenues for 2016. Additionally, with our first Ultra HD ("UHD") television channel launched on AsiaSat 4 in October 2015, we announced the launch of the second channel, which will help lay the groundwork for the future development of UHD in Asia and on AsiaSat 4.
In 2015, the environment for the satellite broadcasting industry was very competitive. Excess capacity in the region, slowing demand in some markets and increasing competition among global and regional operators exerted downward pressure on transponder pricing.
Some governments in developing countries continued the trend of launching satellites for their local markets, increasing supply and in some cases restricting market access for foreign satellite operators.
We also began to see changes in the industry as customers in established markets began to explore the use of terrestrial networks for certain content and data delivery.
All of these trends will continue to have an impact on our business and the industry at large in 2016.
Revenue for 2015 was HK$1,311 million (2014: HK$1,365 million), representing a decrease of 4% from the previous year. The decline was primarily attributable to non-renewals of contracts by several customers due to challenging conditions in their markets and downward pressure on transponder pricing.
Operating expenses in 2015, excluding depreciation, totalled HK$253 million (2014: HK$260 million), representing a decrease of 3% compared with the previous year. The decrease was mainly the result of lower legal and professional fees, recovery of certain impaired debts and lower satellite operating expenses. Nevertheless, the increased exchange loss due to the revaluation of the RMB offset the savings mentioned above.
Finance expenses in 2015 were HK$77 million, an increase of HK$74 million, compared to HK$3 million in the previous year. The finance expenses represented the interest associated with the Ex-Im loan and the dividend loan. The increase was in line with the increased level of borrowing during the year and included the effect of a lower interest expense being capitalised in the cost of AsiaSat 6 and AsiaSat 8, when compared to 2014.
Depreciation in 2015 was HK$469 million (2014: HK$467 million), remaining stable compared to the previous year. Despite AsiaSat 3S being fully depreciated in April 2015, the savings resulting from this were largely offset by the commencement of depreciation for AsiaSat 6 and AsiaSat 8 in the second half of the year.
Profit attributable to equity holders for 2015 was HK$440 million (2014: HK$559 million), a decrease of HK$119 million, or 21%. The decrease was due to lower revenue, increased interest expense and the lack of finance income generated in the prior year.
The Group generated a net cash outflow, including the movement in short-term deposits with maturities over three months, of HK$3,101 million in 2015 (2014: inflow of HK$1,849 million). As of 31 December 2015, the Group had cash and bank balances of HK$238 million (31 December 2014: HK$3,346 million). The cash inflow mainly comprised the net cash from operations of HK$875 million (2014: HK$1,012 million) and the proceeds from the bank borrowings of HK$1,896 million (2014: HK$2,173 million). The cash outflow mainly comprised the payment of dividends of HK$4,874 million (2014: HK$969 million) including a special interim dividend of HK$4,651 million (2014: Nil), payment of capital expenditures of HK$692 million (2014: HK$1,024 million) and the repayment of bank borrowings of HK$328 million (2014: Nil).
Asia Satellite Telecommunications Holdings Limited issued this content on 16 March 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 16 March 2016 13:37:32 UTC
Original Document: http://www.asiasat.com/sites/default/files/2015 AsiaSat Annual Results_English_final_0.pdf
