Eutelsat postpones growth target, shares sink

France’s Eutelsat (ETL.PA) narrowed and pushed back its financial targets on Thursday, amid a drop in broadcast revenues and capacity delays on two of its satellites, sending its shares down 5% in morning trading.

The Paris-based satellite operator now expects revenue to slip to 1.11-1.13 billion euros ($1.26-$1.28 billion) for its five key businesses in the fiscal year ending June 30.

It had previously forecast revenues ofup to 1.15 billion euros.

Eutelsat also pushed back its forecast for a return to sales growth from the next fiscal year into 2023/24, due to delays on its KONNECT VHTS and EUTELSAT 10B satellites.

Analysts had however already expected slower growth and the group’s first half earnings in fact slightly beat estimates, according to Credit Suisse.

Chief Executive Officer Eva Berneke, who took the helm at the start of the year, said the group’s performance had been “satisfactory” and its free cash flow targets were well on track.

She added that the group, which continued to suffer from an industry-wide decline in broadcast revenues, was also hit by the withdrawal of U.S. troops from Afghanistan, which Eutelsat supplied with satellite communications.

“Since we have good coverage of this territory this had quite a bad effect for us,” said Berneke in a call with journalists, adding that renewals in spring would likely continue to be well below their historical levels.

“It’s clear we will have discussions linked to new tensions with Russia, but this probably won’t impact us in the short-term,” she said.

Berneke, who previously held executive roles in Danish technology and telecom firms, joined the firm after former CEO Rodolphe Belmer unexpectedly resigned to take over at French tech firm Atos. Reuters